Question: New to Forex Trading

Quoting Kurti

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It depends on your system and timeframe.

2,5 months seems a bit early to me, if you don't even know where to put your stops yet.
You have to watch the market first for some time and recognize patterns, moves and so on.
Read and learn by doing, is my advice.

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Quoting PeterFM

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But go check out all the Money Management threads in the Beginner's section.
I would suggest demoing for a while yet until you understand at least the basics of FX trading, it's nowhere near as easy as you've been led to believe.

If, after a while, you feel you've found something that works for you, then split your $2500 into really small chunks and trade micro lots with the first chunk (say $150). InterbankFX, Oanda are reasonable places to start.

If you blow that first $150, start again with another $150. Learn from your mistakes (one of which will almost certainly be trying to trade the news announcements - THIS IS NOT FOR BEGINNERS). If you blow the second chunk, start again.

Hopefully, you'll have found a method that works in real life, rather than demo, before you blow your $2500.

You need to understand that trading a mini account with only a small fund creates its own problems in terms of being over-leveraged, and using too high a % risk profile for each trade.

Please, please re-think your approach to this, we all hate to see newcomers making the same mistakes that we have.

Some of us have survived because we took on board, and stuck to, the words of advice given freely on this forum. We'd really like to see you still around next year.

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Quoting karmostaji

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Master 'Money Management' before you go live

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Quoting SammyJ

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In my humble opinion, paper trading is just waste of time.

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If you can afford to waste some money , (because you will lose it for sure), open an account and start trading. Then you will know can you take the pressure or not. Small trades for start.

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Paper trading is not going to give you true taste of Forex Spot.
Regarding your question how many pairs you should trade , I’d stick to one. If you know your trading plan , and I recommend writing it down , you will be able to control your position easier if you don’t get yourself thinking about EURUSD , GBPJPY and EURCHF all at the same time.

Quoting Vaio4x

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i really dont know if my question is a kidergarten like, but can you please answer it for me. but please answer some of my question at the beginning of this thread.

thanks guys!

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1. Whenever I do Buy/Sell I always put +/- 15pips as my limit. Is this too small or it depends? Can you give me some figure.

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2. I'm planning to open live account maybe 2months from now. $2,500 deposit and with 10k lot size ($1/pip). My question is when your trade is loosing, what number of pip is it advisable to stop?

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3. How many pairs is advisable (for newbie) to open same time? in my demo version i open 4pairs....i dont know if this is advisable or not.

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4. What currency are normally using when trading (UER/USD, USD/CHF, etc.) ???

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5. I'm using Dealbook 360, satisfied with their platform and i feel i can beat nostradamous by using their platform Can you please recommend me your experience with this platform and GFT as a broker. I heard that DB360 is freezing?

Quoting PeterFM

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For example, let's ask Vaio4x if he understands the difference between

1. Market orders
2. Buy limit
3. Sell stop
4. Sell limit
5. Buy stop

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2. I'm planning to open live account maybe 2months from now. $2,500 deposit and with 10k lot size ($1/pip). My question is when your trade is loosing, what number of pip is it advisable to stop?

Quoting PeterFM

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OK here's my 2 cents Depends. I'll assume you're trading short-term charts. My first advice is to start on longer charts, no less than 4hr at this stage. Your exits should be based on a range of things, and there are on-going discussions on the forum about this. Your exits are where your profits come from and will determine your future in FX.Again, this is linked to question 1. If you're only looking for 15 pips profit from a trade you can't afford to have your stops set too far away, unless you have a method that gives you substantially more wins than losses. This is the problem with short term trading as a newcomer, it takes time to build confidence in letting trades run against you whilst waiting for confirmation that a trade is either good or bad.As others have said, stick to one for now. Maybe GBPUSD, as it has plenty of action normally and will give you a feel for how the market's rhythm changes from day-to-day.Not my first choice, but that's just a personal thing.Can't comment. I use InterbankFX and MeteTrader4 and am very happy. It lets me trade micro lots and use the most favoured platform on this forum (I suspect)

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Quoting luqmanz

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Live account is the best way to learn. But 2500 is probably too much ... Start with USD 100-200 with brokers that allow 1 cent/pip... You are at learning stage not earning stage. No point in trading big amount.

Good luck.

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Quoting SammyJ

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Vaio4x , you are asking sensible questions , so no need to feel guilty for posting them. Long , long time ago , when I started trading forex spot ( back in 1987 ) lot of dilemmas that novice traders are facing today had been solved by brokerages that existed back then. Maybe I should take you back in time( I feel as a dinosaur) , and tell you all about it. It will solve some of the questions you have asked.

1. Margin trades – leverage wasn’t a problem, simply there was no leverage. I started simply by exchanging cash I had in a bank . To my delight, friend told me that in London there are few brokerages which are offering margin trades for derivates (and forex spot is considered one ) so I might try to trade spot with them. Rules were simple – leverage could not be bigger than 5x, and I highly recommend to you and all others, who are trading forex spot less than 2 years, to stick to this rule. Again , at the time (God this makes me feel old ) , brokers cared about their clients , and their goal was to keep you alive as long as possible ( forex was unknown to most investors , so getting new clients was as tuff as discovering new planets ) .So before even getting into risk/reward you have to consider leverage , and how big it should be. Secondly we need to discuss how long can you stay in the position.

1. Time frame that you trade – In my humble opinion stay away from arbitrage (leave that to professionals) , look into bigger time frames. So let say , for argument sake , you want to trade mid term . That means that you should open and close 1 position on 1 currency pair , during same week. Lets say that pair is EURUSD ( so if your margin is USD 2500 you should buy/sell , not more than EUR 9000). Now on weekly chart go back in time and look at the bars. You will notice that , in normal market conditions , pair range per week is between 150-200 pips. Therefore , you can not make more than 150 pips on your trade.

1. Risk Reward Ratio – this is an important issue. My R/R is usually 1:2 , but then remember I am an dinosaur! So if I’ll go to get 100 pips, my stop will be at 50.This enables me to cover two losing trades with one winning. If you manage to keep yourself out of red , there is a good chance you will be making a lot of money out of this .Looking back to my example , EURUSD mid term , 50 pips stop loss sounds reasonable.

1. Trading style – You have to decide what will be your trading style. Are you trading on fundamental or technical analysis. Or both , plus you’ll get some gut feeling involved . Whatever you choose , for the love of God , please , please DO NOT HOPE. HOPE is not included in Foreign Exchange !!!! Once in position all new traders ( and I mean new for all those that haven’t been trading more than 5 years ) start to hope. If their trade is going well , they start to hoping that today is a day when market will go over their expectations and reach some unbelievable level. So instead executing their original limit , they start moving it higher.99% of the time , this will make quite good trade into big loser. In case market go against their trade , HOPE kicks in , and they start moving their stop away (so instead losing what was originally planed they lose much , much more ). There is a third breed of traders which will, with help of HOPE, start adding to the position . Never ever do this !

1. At the time I started trading , phone was all we had. Trading platforms were non existing . Today we have luxury of trading simply by clicking the button , so in my eyes all trading platforms are wonderful .Keep in mind that , once you start trading for real , lot of things can happen , and you might be thrown to the stone ages. Be prepared to trade on phone as well. Just in case.

I am quite new to this forum , so I apologize for my long posting. There is so much to say on the subject , but I believe this covers your first questions. If you have more questions , just ask and I am sure , we are all going to be happy to share our experience and knowledge with you.

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Quoting Vaio4x

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as of now i used 15mins, 1hr and 4hrs trading time. I'll try the Long term as you advise, but will i get a good grip of FX trading if I used the Longer chart? If i used Longer chart is that means that atleast minimum of one day i should not closed my trade even its ++pips already and just wait for 3 days or 1week before closing it?

thanks Peter for sharing!!!

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