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Start Your Learn4x EvolutionNew Forex traders too often mistakenly try to master technical analysis as a first step in preparing to trade. A ritual practice for novice traders is to use as many technical indicators as possible. As a result, a great deal of time is spent trying to absorb a vast amount of information. This leads to frustration because the list of available technical indicators is extensive and many indicators are not appropriate to currency pairs. New traders frequently ignore fundamentals relating to Forex, perhaps because such information cannot be neatly packaged. But technical trading does not exclude fundamentals, it ultimately reflects the global forces of economic growth, interest rate differentials, and market psychology. Forex is both a micro-theatre of action for trading, as well as a macro-stage for positions.What do Forex traders need to know to get started? The path for evolving into a capable trader must involve a test of knowledge in the context of experience. To get immediate experience, many individuals choose to open demo accounts, start trading and then assess the results. A demo account can provide effective training, but without guidance the results of a demo account cannot be reliably transferred to real trading. Still other individuals start trading Forex with mini-accounts offering huge leverage of up to 400 to 1. The appeal of a small account is understandable since it allows someone to start trading Forex with as little as $500, Yet micro-accounts do not provide a realistic transferable experience, and new traders should use less leverage. Why do most new accounts end in failure? Is failure inevitable? Successful trading in Forex exists, but the path requires a process of learning that has distinct central features, evolutionary phases and a central logic of action. By success we mean the ability to struggle and yet survive through losses and surprises. Success Forex traders have a "fitness landscape" where their trading skills have been honed along several parameters. Long-term success takes skills in adapting to changing market conditions. Without those special skills the market will remove the trader as unfit. There are a lot of variations in successful trading a trader can employ to avoid extinction. Some traders may have enormous skills in identifying direction and find comfort in longer term trading objectives. Other traders may be better suited for short-term trading. Every person needs to discover what special skills give their trading a natural advantage. Avoiding deep losses is a key skill One of the most common experiences for new traders is being wiped out quickly. Avoiding deep losses is equivalent to a tree avoiding its central branch from being cut. The tree will survive - even thrive -when minor branches are cut. In fact, through small disasters growth in nature occurs. Loss control and the ability to keep the account intact is the paramount skill that has to be learned by traders. But losses can, if properly evaluated, become the impetus to improve total performance. Losses provide opportunities to learn new tactics. New traders who focus on achieving big and quick gains expose themselves to losses that kill. Develop your own Forex I.Q. How does one graduate from a beginning trader to higher levels of success? The critical factor in the evolution of a Forex trader is "intelligence". Intelligence in trading is not about predicting market moves. Currency markets reflect a complex interaction of global economics, geopolitics and psychology, making it nearly beyond prediction. Many trading systems that offer a novice trader tools to trade have an appeal because they represent a short cut to success. These systems use a variety to process market data and then generate an alert or even a trade signal. Trading systems fail to improve trading because they fail to model how the market works. Systems work, some of the time; but they all share the dangerous effect of limiting the learning ability of the new trader. Why improve your own skills when all you need is a system that does it for you? Join a Forex trading community Yet the new trader has a more powerful alternative for acquiring and improving intelligence - the experience of other successful traders. Successful traders know how to recognize high probable patterns that provide trading opportunities. Rather than trying to predict market moves they know how to react to market moves. They learn how and when to join the crowd. The wisdom of the crowd has been a reliable source of survival throughout nature, whether it is a flock of birds, a swarm of bees or a price wave. New Forex traders can learn more from other successful traders than from manuals and programs. Ultimately, the critical factor for improving Forex trading is self-awareness. Too many traders do not understand or evaluate their own trading record. How can one shape trading objectives in the absence of a complete understanding of the strengths and weaknesses of your own performance? Beware of short cuts! Is there a single preferred learning path that leads to Forex success? We know from proven experiences that there is an evolutionary process with stages where trading survival skills emerge. As more firms offer "education" in an attempt to generate new customers, many beginners will be lured by training and tools that offer a short cut, but it will be those education programs that enable a person to acquire trading skills, test their knowledge in real trading challenges, and share the successful experience of others that will contribute to the evolution of a successful Forex trader. This is the mission that learn4x.com is dedicated to achieving through first-class mentorship and state-of-the art instruction. |
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