Learning through a Forex Trading Tutorial

Learning to trade through a forex trading tutorial is a pleasant way to learn some of the basics. Because beginners get to see how other traders think and act.

Learning to Handle Price Action through a Forex Trading Tutorial

Learning to trade profitably through a forex trading tutorial is not really easy at all. And most beginners actually fail to become profitable. If it was that easy, everyone would have become rich shortly after attending a forex trading tutorial. What the tutorial does is simply encourage young and beginner traders to take initiatives in the market. It’s more of a psychological boost rather than a source of effective knowledge. They all want to learn how to trade forex but they are not willing to accept some parts of the methods that their mentors use. Forex training is usually presented through a series of rigorously defined steps and rules. And young traders don’t like to be disciplined to such an extreme level. And rightly so, since too much discipline kills creativity and imagination. If one wants to be inventive, in any field, they will have to bend or break many rules. There’s no such thing as unbreakable rules. Beginners will find a lot of inspiring ideas in a forex trading course, but each person will deviate from the material taught. Real life has showed time and again, that the most inventive and creative students are the ones who are not disciplined. They are however hard working and curious to explore new things. The forex market is a very competitive place, and even the mentors teaching these courses will have to answer difficult questions. Questions such as how much money they have made. Why they are not working for an investment bank. And the predictive power of their indicators. And mentors tend to answer using trading examples, where risk and rewards are presented in a realistic way. The bottom line is that many of these course do have something to offer, mostly in term of building confidence. The knowledge itself is not proprietary or super effective in anyway.

The Best out of a Forex Trading Tutorial

The best you can gain out of a forex trading tutorial is a confidence boost, and learning how other traders think. The average forex trading course does help beginners see how other traders think and act. Generally, those who are very disciplined and lack courage, will tend to become momentum traders. Traders who simply follow price up and down, lacking the courage to sell into a rally or buy into a plummeting market. Bold traders on the other hand will break a series of rules. They will buy into a plummeting market, if the believe the conditions are good. And they will even add to a losing trade. Bold traders believe that there is a massive inertia among 1000s of disciplined traders in the world. And this inertia keeps them on the losing side of the market, every time a sudden reversal takes place (contrarian indicators confirm this very well during surprise market reversals). Inertia is a bad thing in the forex market, and is all down to the refusal of traders to accept they are wrong. All because they cannot accept that their in-depth analysis, which took many hours, is wrong and useless. Well, any analysis methods relying on extreme discipline are not analysis methods at all. Many times, opposite market forces are massive in magnitude, and exactly equal. The market could tip one way or the other as result. Momentum traders and over-disciplined fundamental analysts cannot see this risk.

Learn how to trade forex

By now it should be clear that to learn how to trade forex, a newbie must acquire a variety of skill sets, elements of self-discipline and basic knowledge of international finance.  Of all these components, the least intuitive and most critical is the mindset of a trader, best illustrated in the aphorism of the great economist John Maynard Keynes who in 1936 likened the (stock) market to a beauty pageant, where judges must choose not the prettiest contestant, but the female most popular with the set of those who could vote. The way to profit in the short term is to anticipate whether the mass of traders will be buying or selling, directing the market upwards or downwards, not only the fundamentals behind the underlying reasons. In short, understanding the Freudian death wish is no less important than mastering Milton Friedman’s theory of monetarism.

So, by now you are ready to practice with a demo account, a key step as you learn how to trade forex.  You will find that no two trading situations are exactly alike. Furthermore, you will never be 100% certain of the correctness of your judgement (All that matters is the market-determined price). And finally, even though your last, for example, five out of six trades were profitable, your ability to infer statistically about the profitability of your next six trades is limited.

Other veteran advice to absorb as you learn how to trade forex relates to herds and mass behavior:

• Be wary of proferred advice.Expert accepted wisdom is just that, “accepted.” Anyone agreeing with the stated opinion/analysis has likely already acted upon it and few remain to further move the currency pair in the purported direction
• The trend is your friend.The focus-obsession on 50- and 200-day moving averages has a statistical basis. The laws of physics do prevail in markets. Motions and direction ten to continue.
• Relatedly,it is better to be late to a party than early. Scalping (wherein you benefit from price movements over short-time (intra-day) periods) or even day-trading are for professionals with greater knowledge, concentration and resources than what stands at your disposal.