subject: Figure Out Forex Trading - The Best Forex Traders Trust Their Own Trading Decisions [print this page] Figure Out How To Trade - The best Forex traders don't trust their trading to anything or anyone but themselves, so you should do the same. If you learn the ropes yourself, you'll be more successful at Forex trading than if you use an automated program.
Educate yourself on the Forex trading process with the many books and courses out there, and some practical experience on the market can't hurt. You should also explore the plethora of websites offering all manner of information about the foreign exchange market.
Use Risk Capital Only - Money you won't hurt from losing is known as risk capital. Set some of this aside specifically for trying out Forex systems. If you can put just enough in that your livelihood will not be jeopardized if your Forex account would be lost, that's the right amount of risk capital to use.
'Scared money' on the other hand, is money that is invaluable to your living that you trade with anyway. You can lose sleep over worrying whether or not you'll lose it when trading, leaving you scared when you use it, hence the name. The bottom line is that you should never trade with this so-called 'scared money' as it will only lead to an ugly and painful result, or more than likely will, unless your extremely fortunate.
Don't use this type of money; trade only with money you can do without if the worst happens. Even if you end up making money while Forex trading, it might not do so at a time of your convenience, so keep this in mind. The more important the money your trading is to you the greater your emotional response and the higher your chances of loss.
Don't Exacerbate Your Losses - Far too many people do this to themselves. No one likes to see themselves losing money on a trade. However, this experience is part and parcel of Forex trading, and it happens to even the best Forex traders on the market, so don't panic and do something regrettable.
A lot of amateurs make the mistake of putting more money on a losing trade, so their averages are better. These people are gambling that they can recover their losses when it starts going back up again. They're often shocked and disappointed when the trade keeps losing money and shows no sign of stopping. Your losses are now bigger, and you won't ever get that money back.
by: John Eather
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