How To Make Living From Forex

How To Make Living From Forex

How To Make Living From Forex

Of course, a complete guide on how to make living from Forex is beyond the scope of one article. However, let's describe some important ideas, that will help you along the way.

First of all, you need some sort of a system. It doesn't have to be complicated - a lot of money has been made by simple systems based on nothing but price action, or just moving averages. The system must suit you as a person - you have to consider - do you like to scalp? Do you like swing trading? Or would you like to take trades that take months? All those time frames are perfectly fine to make money, you just have to choose whatever suits you best.

Once you have decided on a system, test it on a demo account for at least a month. This way, you'll get a hang of it and start to trust it - trusting your system is very important, you have to know it works out over a period of time.

Next, you have to understand, how much of your capital you can risk per any single trade. It is important not to risk more than 2-5% of your capital on any single trade. If you have a small trading capital, use a broker that offers microlots.

Have realistic expectations. Always remember, that your main goal is to protect your trading capital and to let it grow over time, and compounding interest will take care of you. Realistic expectations mean that you have to expect realistic gains of your capital. Forget those sales pages, that say that it is possible to make 200% of your capital monthly. It isn't possible with any sort of sensible risk management.

Currency market moves very fast, and if you're not sure what you're doing, and have insane risk exposure (for example, you risk 50% of your account on one trade) you can wipe your account literally in seconds.

Now that you have a system and understand your risk profile and set your risks accordingly, you have a fighting chance to make living out of Forex. Remember to start small, and slowly increase your capital over time - both by investing additional money and by compounding your gains.

Once your capital reaches a certain size, you'll discover that you have a chance to take out nice sums to pay for your living, and still leave some to accomodate further account growth.

POST COMMENT

Bforex Commodity Trading Bforex Trading Forex Technical Analysis and its importance in FX trading Forex Currency Trading - The Basics Bforexlessons dot com – Educating the world in forex trading Forex Trading for Learners Best Forex Trading Course Elementary knowledge about Forex Forex Charts As One Of The Most Important Trading Tools Benefits of Forex Swing Trading A guideline for the newcomers regarding Forex Forex Trading News - Is It Really Necessary To Read It? The Forex And The Many Indicators It Has