Help for Newbies (Discussion Thread)

It's interesting. Happens all the time. Part of being a trader is having the confidence to get over losses and move on without losing your cool

Hi Guys,

I am BRAND new to this. I am currently playing on a fantasy FX website, but I am struggling to understand it. Is there any books for complete beginners that anyone can recommend?

Also, what is the MINIMUM amount you can trade with? Being a student I don't have money coming out of my ears, so trading with very very low amounts would be ideal.

Thanks in advance

open an account with gft, the deal book 360 is a great platform, and minimum like 300.00 USD or so, check with your area.

and for begginers the first thing is read up on

candle sticks (understand them well)
chart patterns
supply and demand
pivot points
resistance/support
moving averages
bollinger bands
fibonacci trading
elliot wave theory
money management
trader psycology
psycology indicators
swing trading, scalping, etc

in other words read everything, learn everything, and know that no indicator will TELL YOU what to do, YOUR BRAIN is the best indicator
they sort of guide you/ keep you in line but either they are lagging or wrong

Sorry, but if most indicators are wrong and lagging, then why do all traders use them?

I just don't get it.

So, you say that our brain will tell us later? Is it some kind of "Intuition"?

Not far from Tarotism and maybe Gambling.

Care to explain?

Thankyou for the help. Appreciate it.

Is 350 pretty much the lowest minimum deposit there is? Thats still alot to me. I'd rather try as low as possible, I don't care if my profits are minuscule.

indicators are helpful in a way, but THE MAIN most important thing is PRICE ACTION.

LEARN to read the charts in front of you without indicators.
the thing with indicators is that they all tell you what HAS happened, none will tell you what WILL happen.

most traders use them or should use them to help with your CHART, PRICE ACTION analysis. in other words, read, listen to what the market is doing, where the price is going. SUPPLY AND DEMAND. are people selling are people buying are people scared (stalling)

RSI, Stochastic, ADX, MACD, all assist you to make sence of what has gone on. RSI overvalued can caution you to be careful going long because the market seems to be overbought, usually at 70 or 80, when it points down seems to tell you is getting less overbought, hence people are selling, should analyze if going short might be a better idea, stochastic crossing downward same thing, means probably go short, but THE MARKET CAN STAY OVERBOUGHT OR OVERSOLD FOR A LONG TIME. so dont blindly sell because its overbought or pointing down, I USE TO DO THIS and got burned.

using your brain means: see the indicators, what are they tell you? ROC RSI Stochastic, or ADX whatever you use MACD,

support and resistance. is the pair at a level of a pivot point support or fibonacci retracement, has it bounced off the support line a couple of times, and HAS IT FOUND support there in the past.
is the chart in front of you in a bullish pattern?
what are the candle sticks telling you? is the elliot wave confirming you asumption?

if you use Moving average cross over, have they crossed?

i dont want to make this complicated but thats how my brain works?
when all points to the same thing in different time frames. its called confluence, but to be profitable all you really need is identifying the trend. you could time your entrance horribly but if you are with the trend u still make money.

THERE IS NO METHODICAL, MECHANICAL, SILVER BULLET. FOOL PROOF way of making money. thats why i say your BRAIN.
look at the information, (your diagnostic tools) and make a reasonable, rational decision. Short, if you believe your information is corroborating the price moving down. Long if it will most likely move up. and IF YOU HAVE NO CLUE stay in cash. till you see a good oportunity.

only take the ones you reasonably believe will succeed. and always put stop losses to stop you out if youre wrong. no trader is always right.
never move your stop loss so it wont be hit. and NEVER HOPE or TELL the market what to do. you LISTEN to the market and go along.

try a practice account till you are confortable trading.
remember you are not in it to loss your hard earn money.

Hello again,

I have recently come across a website that has exactly what I am looking for. They have very plain english easy to follow guides. I am not sure if I can link it, but basically its a website with guides starting at pre-school, going onto kindergarten, elementary, middle school etc.

Those of you who know the website I am talking about, is it trustworthy? Is the information they give accurate? I really do want to get into forex trading. Maybe not as a career but as a hobby as it fascinates me.

Thanks again

"Currency Trading for Dummies" (part of the "Dummies" series of education books) is an excellent book to begin learning Forex. You can also check out my website (link in my signature below), where I also provide education and resources for forex traders.

If you don't have a lot of money to trade with (make sure you're always trading with money you can afford to lose, btw), your best bet is to trade on a mini-lot, or even a micro-lot trading account. Also, some brokers have a minimum deposit requirement as low as $100 to open an account. My forex broker review on my website can provide you more info on finding the best broker for your situation and trading style.

Excellent post, redlion. I couldn't have said it better myself.

Hi Oceanofpips,

I was going to purchase the dummy book, but there are very mixed reviews on amazon. Some say it isn't really for dummies at all, more of a reference for slightly experienced forex traders?

Many Thanks

you don't really need to purchase anything. i am by no means an expert but i will guide you through how i study.

1-start of with candle sticks, and understand their meanings.
google candle sticks, candle stick patterns,

then post here what you found out.

I there, this is my first post, my name is Nuno, and im from Portugal; altought im here at FF some weeks from now, today i got the register button. i want to thank you, your excellent thread, were i already did taked out some juice. i need to read it again, then i guess im able to make some questions. lets make some green pips, and thanks once again!

Thanks for the advice redlion.

Currently working through a websites free training thing and its proving helpful. Don't wanna link the site but its basically small people pips. (work it out) ;D

hey guys i need your help on this. If I were to buy the pair GBP/NZD at 1 standard lot at a spread of 50 pips with a account balance of $1000, will the margin call be activated immediately when I buy it?

@The RedLion

Thankyou for the PM, unfortunately I can't PM back due to having a junior account, but thankyou for the advice.

I really need to get a grip on forex. I have a practise account on bullbearings, and I just don't see how you can predict stuff, although I am still reading through huge amounts of information so have alot to learn. At the moment I am just doing completely random stuff.. I look at the little graph bullbearings has on say GBP/USD and then literally guess whats going to happen, 90% of the time I am wrong as it just seems so unpredictable, going up and down up and down randomly.

Is there some kind of software I should be using? I have heard of something called MT4 but not really sure what it is. I intend to stay on practise accounts for months before I even attempt to use my own money. This seems like a fun and exciting way to pass spare time, and I am also finding it very interesting.

Many Thanks

Ewaf

hey ewaf, i started a trading journal and i actually share EVERYTHING i know about forex just for you. since i want you to succeed.

is a lot of info but if you dont understand it let me know.

I like trading the 5m and 1m charts but when looking for resistance levels with fibonacci re-tracement tool what is the best time frame to use. Also do you start at the top of the wick or at the open.

Thanks

Personally, if I could go back in time I would start off with studying market structure (boring stuff, NO charts) for at least 6 months. Then you'll be able to see exactly why the market moves. Ie, forget price and focus on distribution of liquidity, know how s/r is formed, ect. There is a reason most new trader's stops are hit or forced out of the market. In fact there is a classification of uninformed traders who will always lose no matter what and the only way to not lose money is not to trade.

Think about a poker game. You just turrned 21 and are sitting at a table with a couple pros seen playing on TV who have huge bankrolls. They're only there bc they have proven they have an edge or else they wouldn't be able to play for so long or be so successful. They make money from people losing money yet hide their faces so people will come and play along or else no one would be stupid enough to knowingly play with them. Don't come to the table unprepared.

There is NO support or resistance per say.

in the sense that price wont really respected. this is psycological game, support/resistance HELPS identify SUPPLY and Demand.

look at your 1 hr chart and draw a line of where has price stopped moving up or down. I believe, that the longer time frame will give you a clearer picture.

but you could identify this areas in you 1 minute or 15 min or 5 min chart. where has price stopped falling, and moved up, where has priced topped.

THEY OFFER NO RESISTANCE AND NO SUPPORT

they merely help you gauge supply and demand. where are people scared to buy and where do people stop selling

but price can fly through them at anytime