Learning something new, even forex trading can sometimes get overwhelming. Those who are new to the world of online forex trading can often get confused with the many distractions that are available.
Mostly, you can come across products that markets itself as the black box solution to making money trading forex.
If you dig a bit deeper, you might even come across courses that are expensive and promise you to teach all there is to know about forex. In fact, reading through such marketing material, you might almost be convinced of yourself that the course you came across is the best.
Most forex traders who are new make the classic mistake of spending money where they shouldn’t be and only realize this at a later stage in their trading journey.
So, if you are asking yourself the question on what’s the best way to learn forex, then read on.
Where to start to learn trading forex?
As with anything, you need to understand the basics of the subject even before you can put it to practical use. As a result, the first place you should start is to look at some reputable websites that can offer you information.
Contrary to your opinion that information costs money, there are still a lot of websites that can impart knowledge for free.
Spending time on websites such as Investopedia is a great way to understand what forex trading is all about. Of course, the information can be overwhelming but take your time.
Once you are familiar with the basics, the next step is to understand what tools you need to trade. At the outset, you will need a good trading strategy. But a good trading strategy comes with understanding how indicators and most importantly, how technical analysis works.
You can go through the numerous threads. If you have a question, chances are that there is already an answer on the forum.
Spending time at forums is a great way to get started and to take your learning to the next step.
Reading books and Youtube tutorials
If you are really interested to become a better trader, then you should invest some time and money into purchasing some good books on forex trading or the currency markets in general. You can visit websites such as Amazon.com to research into some goods books.
You can pick these books by simply reading up on the reviews and of course bearing in mind the cost.
A lot of information can also be found on YouTube. However, be careful as many times you might come across tutorials that are disguised as a marketing campaign which will compel you to buy a trading strategy or a course.
Choose the right currency pair
It’s highly important to choose the right currency pair in order to make your online forex trading activity successful. It shall be considered in terms of your location and time frame. For instance, to choose the GBP/USD currency pair will be a rational decision if the US and London trading session is active during your trading hours:
- LONDON SESSION – open between 8 am GMT – 5 pm GMT;
- US SESSION – open between 1 pm GMT – 10 pm GMT.
And that means that GBP/USD interest rate is very volatile between 1 pm GMT – 5 pm GMT.
Putting it into practice!
What’s the point of learning if you do not practice it? A great place to start is with a forex demo trading account. Most forex brokers offer a free of cost demo trading or a virtual trading account.
Some of the best traders have dedicated years of time and effort into being the best in the industry. That’s why a lot of beginners start their trading activity from a free Demo account, where it’s real to get enough practice with no money invested in it.
Usually, it takes around 2-3 months practicing with virtual money to break in.
It is important to understand that to be successful in forex, you will have to put in a lot of effort and practice. If you think you can become rich with forex trading within a week or a month, that is an unrealistic expectation. Therefore, you should also have your expectations right before you start this journey.