Most novice traders after the first acquaintance with the strategy and the first success on a demo account (often random) immediately begin to consider themselves professionals. The result of self-confidence is predictable: more than 70% of beginners lose their deposit and are disappointed in trading. But the rest less than 30% earn on it. Below we have prepared a short list of what a professional Forex trader should know, without which it is better not to start trading on a real account.
Basic Trading Basics
The basic principles of a professional Forex trader are common, but they will help shape the direction of self-development. The trader must:
- understand the terminology. And it’s not just about technical tools or terms from the offer. The trader should know what verification, chargeback, regulation, prop-trading, etc., are;
- Know how the market works. The general concept of Forex as a foreign exchange market is fundamentally wrong. A professional Forex trader knows what A-Book and B-Book models are, understands how to execute orders (Market, Instant Execution), knows who market makers are, liquidity providers and how ECN accounts work, etc. All this will help the trader to choose a suitable broker and to distinguish where the broker is to blame for the problems with quotations, and where the market is;
- understand the technical side of trading. A professional Forex trader should be able not only to apply indicators and follow the news, but also to understand the principle of their work. It is important to understand how Metatrader works and what is the difference between trading platforms among themselves. Before trading, you need to understand the types of strategies: scalping, hedging, arbitrage, etc .;
- Be able to analyze strategy results and evaluate prospects. Prior to the start of trading, a trader should know what a bektest is and be able to correctly read its numbers. Knowledge of statistics is not necessary, but to understand the criteria for evaluating the effectiveness of a trading strategy and at what point it needs to be optimized, the trader must;
- to have information and technical support. It’s not just about forums or video courses. Assistants traders – diaries, MyFxBook, RoboX, TradingView, etc .;
- remember the importance of psychology in trading. A trader must be able to stop in time, be able to restrain his emotions, soberly evaluate not only the causes of the loss, but also profits, in order to eliminate the probability of chance;
- be able to calculate risks.
This list can be supplemented more and more along with the growth of professionalism. How long will it take to master the basic information, a rhetorical question. Someone learns in a few months, someone takes 1.5-2 years to find his strategy. But in any case we are not talking about a few weeks. Most of the information can be found in books, courses, etc., but you will learn about the specifics of transactions only from professionals. Read the professional forums of Forex traders and save on the spread with FxCash!