How I Succeeded as a New Trader

It really is strange to see just how many people assume that Forex trading is an easy thing to do – it's definitely far from easy! We often make the mistake of taking advice from those who aren't traders themselves i.e. friends and family and even though they mean well of course this is going to be bad advice.

The best way to advance in your trading is to get advice from an actual Forex trader; this is why I'm giving you my personal story of how I succeeded as a new trader. It's important to read carefully as there will most probably be a lot of information here that you can relate to – the majority of Forex traders share similar traits and thus make similar mistakes.

Learning the Fundamentals of Forex Trading

Soon after I discovered Forex trading I became enticed by the possibility of becoming a millionaire overnight – the dream that we all have! And luckily for me, I understood that the most important aspect of anything is the fundamentals, you can't expect to build a skyscraper if the foundations aren't solid.

I first began by reading up on the material over at babypips.com and various other sites in the industry. I also picked up and read as many books as I could find, many traders will argue that books aren't very helpful but I disagree, I found a wealth of information in those books and they helped me get a head start on my trading – they are even useful for more advanced traders. A great book which I can't help but recommend is “Enhancing Trader Performance” by Brett N. Steenbarger.

Shortly after learning the fundamentals of Forex trading was when I jumped in and opened my first demo account with Tenkofx, I chose them mainly because I liked their platform and they offer custom lot sizes.

I quickly became bored with demo trading as there was simply no emotion present throughout the trading day; I just wasn't bothered whether I had a gain or a loss because the money wasn't real. This resulted in me opening a live account with a spread betting broker (for tax reasons) with a deposit of $1000 – all of which was gone in the short space of just 3 weeks,

·NOTE: I'd like to point out that even though I did compromise on my broker in hopes of not having to pay capital gains tax, this was the wrong thing to do simply because the broker I chose wasn't right for me. Do not compromise on your broker!

Accepting That Failure Is an Option

I took a short break away from Forex after the loss of my $1000 to focus more on school and stable income sources – at that point in time, I definitely didn't see Forex as a stable income source and I believe this should be established before an individual starts to trade.

I never reopened a demo account because I believe that trading is nothing without the emotion – instead I began to watch the markets and look for set-ups. Even though I hadn't opened an account, I had now accepted that failure was an option and could happen at any moment in time – this changed my mindset slightly and I began to approach trades – as well as failure – much differently than I used to. From every failure came an opportunity to learn, there was a subtle message every time I was wrong. Instead of becoming infuriated with the markets, I instead began to ask how the other people were making money – did they see something that I didn't? Were they using an exclusive indicator that I didn't have access to?

As you can probably tell, this way of thinking forced me to take a different approach to the markets and I began to realize that Forex trading isn't so much as who has the best strategy, but it's also about personal development i.e. changing your mindset and opening your mind to new possibilities.

Adjusting My Strategy and Implementing Risk Management

After taking on this new mindset and approaching failure differently, my trading style began to change. I opened another live account – this time with Tenkofx broker – and deposited another $1000. 
I got  bonus and used this bonus on a small account where I had to test out some strategies. I would like to highlight that an stp account is a very good option for strategy testing or if you are just making the first steps in trading. When you are planning to start trading it is important to test your broker not only on a demo account, but also on a real trading account. So this is better to open a small STP account and test spreads, execution speed, detect whether there is slippage or not and only after doing all this to switch to a ECN account.  So I used my ECN account for standard trades and my STP account for strategy testing. . I now started to go for the 'slow and steady' approach planning to gain 2% of my capital per week. Their MT4 platform was good for my trading due to its execution speed, spreads and I hardly came across slippages.

I chose them mainly because I liked their platform, their trading conditions seemed very advantageous for me (low charges, fast execution) and finally, their customer service. Customer service is very important when you are choosing a broker. When the customer service takes every effort to help you in your needs you won't have to waste time and can concentrate on trading being sure that they will take care about everything else.

One of the things that I haven't talked about yet is the time frames in which you trade, I started out using the 15-minute time frame and thought that this was great, but after talking to other traders I got some advice that longer time frames are more stable and the 4-hour chart might be a better fit for me – so from that point on I used the 4H chart and it was amazing!

I had also now started to implement risk management properly and was risking a maximum of 1% of my capital per trade – never any more! This also reduced my profit, but I found that the emotions were much easier to control and I started to make smarter decisions.

Because of my experience, I have concluded that Forex trading works out much better when you stop thinking that you can become a millionaire overnight – it is not a get rich quick scheme and if you approach it that way then you will surely be in for a huge loss!

Understanding That My Strategy Needs Constant Change

My trading strategy has always been very simple, I won't go into the exact details but I mainly focus on the fundamentals i.e. following trends, support and resistance levels. As I said earlier, you can't build a skyscraper without first having a solid foundation...

You should also keep in mind that any trading strategy will need constant tweaking. For example, my trading strategy works best when there are visible trends in the market and so if my favourite currency pair is ranging I will simply move onto one of my backup pairs. The market is always changing and your trading strategy shouldn't be any different.