How to choose a Forex trading platform for beginners
Many forex traders started to feel like they were in the confusing world of cartoon character Rube Goldberg, the inventor improvising a mixture of household appliances to perform simple tasks. When you click, the price has moved in the opposite direction, its technical indicators are flashing the opposite signal and the trading robot continues to close the losing trade instead of recovering the investment.
Meanwhile, his colleague was calmly drinking his morning coffee as he read the forex news and was proud of his forex trading system.
Although choosing the right Forex trading system takes time and research, you will be rewarded when you can also relax with the confidence that you are effectively implementing your risk and trading management plan. yourself.
Main specifications of Forex trading platforms
Deciding on the best trading platform for beginners depends on your trading style. If you are a long-term operator, you can find enough of the basic tools of a discount broker. Day traders will want the fastest trading systems used by professional traders. While technical operators need advanced technical analysis tools and can choose to invest in a trading system themselves.
One of the best brokers for both beginners and experts, recommends studying the following parameters: margin, minimum contract size, maximum leverage, maximum deposit Minimum, sales level, type of traded asset, account currency.
Remember that beginner online brokers will have tighter limits and higher currency trading rates than experienced traders.
Also check the latency. Latency is the amount of time it takes a trading system to process a request for a transaction. If your system has a 6 millisecond latency, large operators with 1 millisecond latency can transfer prices from the time you click to make a trade. For example, an opportunity of price difference may be lost when price moves to the same price level within milliseconds.
How to start trading on the Forex market
Many good forex trading guides and beginner trading websites will teach you the basics of forex. But once they operate live, fast-moving markets, changing market conditions and the tsunami of data make it difficult to predict future price forecasts. Even if you get the correct price trend, traders still have lots of execution errors. To avoid these mistakes, traders start implementing their trading strategies using reverse test and trading simulations on demo accounts.
Choose your currency pair and calendar. Five years is recommended; if not, you may be caught up in short-term trends. Next, configure your trading strategy. Determine your entry point and stop loss. Put your indices into position (in this case, support and resistance indicators). Take incidents as examples in a daily time period. Between the high (resistance) and the low (support), the price that is considered most often is an area called the consolidation range. A breakout occurs when prices move out of this range and can, but do not always signal, a transition to a new high or low price. You may also want to monitor volume, momentum, moving averages, and other technical indicators against breakouts.
Go back to trading history, say 10 years and go by bar. Record your trading results (Did you make a profit or stop loss triggered too early?) And related data (for example, changes in trading volume related to stops). This analysis will allow you to adjust your trading parameters accordingly.
Simulation trading (Demo account)
Smart traders perform ‘paper trading’ for weeks, but months before they risk real money by using their trading system demo account to practice trading setup. . In this simulation trading environment, you can make all the mistakes that new traders make, like exiting too early instead of letting them win. Even if your setup is excellent, it may not run fast enough at first and even if it does, you can still lose interest in a millisecond to shutdown. The money market is moving fast and needs practice to master the complexity of trading.
Forex trading tool for beginners
– Technical indicators: they provide information on the direction of price trends. Basic indices include trading volume, support and resistance, historical average price over a period of time (moving average), and volatility (bollinger bands).
Consider whether you are likely to want to use more complex indicators and whether or not they charge a premium for them. Indices can lead (future price direction), lag (historical price) or both.
– Trading robots: These algorithms allow you to enter your trading parameters (stop loss, take profit) and possibly your technical parameters (moving in the average period) and after That automatically runs your trading settings. Its functions range from simple indices to combined indices, to proprietary trading strategies. Your ability to enter and exit an activity no longer depends on your mouse skill. MetaTrader, the most popular trading system, has more than 10,000 trading robots, many for free or offering limited time trials.
– Forex Calendar, News and Tweets: Money markets turn to news about central bank policy, economic growth, corporate earnings and black swan events, making it difficult to predict events like political instability, terrorism or natural disasters. Forex calendars and news plugins are available for trading systems or you can use the FX calendar available online.
– Currency correlation calculator: This tool is used to calculate the extent to which currencies move in the same direction (positive correlation) or vice versa (negative correlation) within the range from -100% to + 100%.
– Forex time zone conversion: Even if you only trade with USD / CDN and never venture into European or Asian markets, the price of your currency pair will be affected by the above market activity. all over the world. Track trading activity during major trading sessions in New York, London, Tokyo and Sydney providing useful information on volume and price trends. If London releases solid economic data, GBP will recover, while a drop in the USD will be affected when the US market opens five hours after the European market.
The best way to learn how to trade Forex is to build your own trading system and start trading on your demo account. Taking the time to study everything about the features of the Forex trading system to support your trading style and goals will allow you to develop your confidence and skills as a trader.