Where should you start?
To the regulars, welcome back and if you are here for the first, please feel at home and I hope you enjoy reading this post as much as I enjoyed putting it together for you. I got this image from Pinterest and I am loving it, I think it is cute. So you want to trade but you are a bit confused on who to follow or which method to follow. The Forex market is such a giant and there are thousands if not million ways to participate in this global market, but it becomes too difficult for someone who is trying to get into day trading Forex. Some few years ago I embarked on this journey of day trading Forex, the first thing that comes to mind when we want to start/learn something new is to go to Google to do some research and to find out more, and many times when we do the search we only focus on the first pages that comes up when we type our keywords, if you can go to Google now and type the word “Forex” you will see the results in just few seconds and there is a lot, I mean a lot of information, some sites will warn you against trading the daily breaking economic news while others will warn you against trading technical, everyone has an opinion, but at some point if you really want to get started, you have to stop the research and just start, do not be the kind of person who is suffering from analysis paralysis (the state of over-analyzing or over-thinking a situation so much that a decision or action is never taken), by stopping the research I do not imply that you stop reading or learning altogether, but you have to use the information that you have already to get started and once you have started, you can then keep learning because learning never stops.
A Few days ago I had a conversation with a very experienced SEO expert, he asked me a simple question,”Ntombi what is your niche”, boldly I responded and said Forex is my niche, he said to me Forex is not your niche but a general niche ( I must say I got confused a bit) he wanted to know which segment of Forex trading is my focus on. I am telling you this to make you understand that even though we are all doing Forex, we are not in any way focusing on one segment. So each one of us has a duty to find out which segment or form of trading suits us, it starts by identifying your own needs and mostly your personality. You cannot just approach this Forex market in a general way, you have to focus on that specific area.
There are so many ways to day-trade Forex, some traders do so by focusing on technical side, nothing else but technical, some traders do so by trading the daily breaking economic news and sentiments (like me). You are new and you have no idea which method to choose. If you happen to learn from someone who is purely into technical trading, stick to what they teach you and if you are mentored by someone who is into fundamentals and sentiments, do yourself a favor by sticking to that at least until you can see if you can make money or not, another thing that makes beginner traders to switch without giving what they are taught time, is because they are mostly in a rush to make it, which is not really a good idea, good things takes time and being sustainable in this market is something that most traders will never get to experience.
It might sound like l am saying you need to restrict yourself as beginner, It is not really restricting yourself but rather focusing on one thing at a time, because if you do not focus, you will find yourself switching a lot without getting anywhere, because everyone has the “best” way than others, there is nothing as ineffective as trying to learn everything at once, it is not only exhausting and confusing but it can also be the number one reason why some people spend their entire life just learning and never put what they learn into action, and besides, what is the point of learning if you are never going to use the information. The Forex market is such an exciting field and it is through that excitement that most people enter the markets only to lose their money.
Why did I fail so much in the past:
During the early days of my trading I followed so many teachings and the most popular one which is purely technical, I tried to learn from different sources which is the reason why I ended up with so much losses, I do not see anything wrong with trying to learn from different sources but when real money is involved, focusing on one method at a time is all you need, you can use different sources as long as it is to enhance what you have been taught initially. Learning is good and learning different ways of trading the markets is very good, but you are not going to be a master of anything if you try to learn all the methods at once, you will be a jack of all trades but a master of none, take it from me, you do not really need to learn all forms of trading at once, one method at a time is good to make you money.
I mostly trade the sentiments and fundamentals because I believe that is where I found peace of mind after failing so much on other methods (note that I am saying after failing, meaning after I traded real money for such a long time and lost a lot using other methods) therefore I had to find the form of trading that will suit my needs and personality. I personally feel at ease trading the reason without cracking my head with technical analysis (which I am not saying is bad) but it was probably bad for me, it all depends on an individual. Use what you have currently, It doesn’t have to be popular to make you money believe me, because if you do not use it , how will you ever find out if it works for you or not?. Just stop switching and start focusing on practicing what you know already, that is the only way to master any skill, ask anyone who is a master of something, they will tell you that the only way to gain experience in anything is to do and do and do.
I recently got an email from a beginner trader who has just finished her training course from somewhere else and she wanted to learn from me as she felt that she paid a lot of money for “nothing”. I asked her why is she saying that, she said to me, she has been following me on my blog and she is also a subscriber, so she feels that her mentor has deprived her some information because he never spoke of fundamentals and the economic news which then makes her to be so confused as she receives daily news alerts from my blog and she has no idea how to use the information.
Wow I saw myself in her ( jumping into learning something new without putting into action what I was taught). Being me, I advised her to start focusing on what her mentor is teaching her, I did not try to make myself a heroin by trying to discredit what her mentor has taught her, but instead I explained to her that she must use the knowledge that she has, It could be the only way she can make it in this market, the truth is, she paid her mentor but she wants to trade her real money using something which is totally new to her. I sent her back to her mentor and told her that there are million ways to trade Forex market and her mentor is teaching her what he believes in and what works for him, if she needed a site to learn from, definitely my blog is not for her at the moment as she feels more confused. I also advised her to subscribe to another blog which will actually speak the language that is in line with what she was taught, because learning never stops, but following me does not enhance her skills as I am using a different approach to what she knows.
This is a terrible mistake that many beginner traders make and unfortunately they do not take advise from anyone, they mostly prefer to make their own mistakes and lose their own money before they can listen, but some of the things are just common sense. If you have never heard your mentor talking about Bank of England (BOE) do not feel deprived, they might just be a die-hard technical folks, and if you do not hear your mentor talking about the Fibonacci, do not feel deprived, they might just be a fundamental and sentiment traders, they surely have that one area of Forex trading that they are focusing on. On my next post , I will explain why I prefer the method of trading that I use, which is sentiments and fundamentals mostly, watch out for the post and read my forex story here. Thank you for stopping by and please kindly share with your social media buddies, someone might just need to hear this or maybe it is what you needed to hear.