How to become a confident forex trader

In recent years, the number of money managers who have closed their funds has continued to increase. This is because their performance and market returns has become erratic.

A couple of examples: in 2017, Andy Hall closed his oil trading hedge fund. At his peak, Andy was one of the best-known oil traders in the world. When working for Citi, Andy once received a salary of more than $100 million for his bets on crude oil. His knowledge and expertise led to many people in the industry to give him the name of oil god.

A few weeks after this closure, another corporate trader named Anthony Ward also closed his fund. Ward was the best-known trader focusing on cocoa. Traders in the industry gave him the name ‘Chocfinger’ for his expertise in trading the commodity.

If you have read about these closures, chances are it might make you doubt if it’s worth become a trader yourself, if big institutional traders decided to quit. However, this article will provide a guide on how you can become a confident forex trader, whatever is happening in the markets.

First, you need to spend a lot of time reading. Fortunately, there are many books you can read about successful traders and how they got started. One of the books you should try is Millionaire Traders by Kathy Lien. In this book, Kathy interviews over 20 traders who explain how they started, the mistakes they made, and their present-day routines. Another book you should read is Fooling some people all the time by David Einhorn, in which he writes about how he started his fund with less than $1 million and grew it to more than $6 billion. Reading these or similar books will give you motivation to get started.

Second, you should talk to people who specialize in trading. These could be your friends, colleagues or peers. Talking to them will motivate you to become a better trader. It will help raise your morale about trading, guide you on what you need to do, and what you should avoid in your trading journey.

Third, you should use a demo account to practice trading. A demo is an account provided by brokers that gives you access to a platform and the data feed you need to get started. It lets you trade the real market, but with virtual money. It is not advisable for you to start trading before using a demo account first. As you learn how to trade, you should simultaneously trade using the demo account. While these accounts give you the freedom to start with any amount of virtual money, you should start with the same amount you intend to start trading with for real.

Fourth, you should deposit the money to your trading account and start trading. If you are afraid to start trading, you must realize that it is the only option you have to actualize your financial trading goal. Therefore, after finding a trusted forex broker and using the demo account they provide, you should go ahead and make your first deposit. To avoid huge losses, you should use a small leverage, use small lot sizes, and always have a stop loss.

Finally, you should accept the fact that trading is a risky thing to do. In every trade that you open, you can make a profit, loss, or exit without a profit or loss. Accepting that you can lose money and working to reduce the risks will help you avoid the fears that come with trading and become more confident. Remember that you are not alone because even the best traders have this fear, but they learn to control it and minimise their risk.