4 Different Forex Trading Methods
Forex Trading Methods Right now is the hottest money making opportunity especially after the stock market crash of 2008 in which a lot of people got their fingers burned. Now, if you are new to forex trading, you might be wondering how to get started trading forex. In this article, I tell you aout the 4 different forex trading methods and the pros and cons. So, let’s get started:
1. Forex Signals
If you are new to forex trading and don’t have much time to learn how to trade forex than you can subscribe to a forex signal service. There are many forex signal services now. You get forex signals via emails as well as sms. With these forex signals, you don’t have to watch the market 24/5. Just enter buy or sell as recommended by the service. The trick lies in finding a good forex signal service. How to do that? First test the forex signals on your demo account. Only by testing a signal service on your demo account, you will be able to know how well the signals are.
Now, a new development has started. Some of the professional forex traders have started signal service in which they trade their own accounts with their own money. You get real live trading signals as these pro forex traders make their own trading decisions on their live account.
If that pro forex trader wins $1,000, you also win $1,000 and if that pro trader loses $1,000, you also lose it. You can copy their exact live trades with a Trade Copier that connects two or more MT4 accounts. Since, the pro trader is trading with his own real money, you don’t have to worry much about the quality of the signals. Naturally, the pro forex trader is going to be very careful in trading his real money.
Secondly, you don’t have to open your MT4 account all the time to enter the buy or sell signals, the Trade Copier will automatically do that for you. Of course, you need to find a good pro trader who is making a lot of money and is ready to share his live trading account with you through a Trade Copier.
2. Forex Robot
Forex Robot also make your trading automatic. In recent years, some good forex robots have been introduced in the market. There are traders who have made a fortune with forex robot trading. But the problem is that most of them were the developers of those robots.
You see, the basic problem with these robots is that they have to be continuously optimized with the changing market conditions. Something, most new traders are unable to do successfully as most of them don’t know much about forex trading.
In addition to that in order to be successful with a forex robot, you need to know a little bit of programming. Most new traders find it difficult. Forex Robots do work but for that you need to learn both forex trading as well as MQL4 programming. Something most new traders find difficult.
Most of the time, the vendors will try to portray as if a forex robot is the most easiest forex trading solution. You only install it on your MT4 platform and bam, it will start making money for you. Nothing is further from the truth. Market conditions keep on changing. A robot that maybe working may start losing money as soon as the market conditions change.
3. Managed Forex Accounts
Forex Managed Account are run by professional forex trader who will trade your money on your behave charging a fee something like 5-20%. You have the right to withdraw your money any time you want. In fact, you keep total control of your money.Managed forex accounts has been the preferred forex trading method for those who did not have the time to trade forex.
4. Manual Forex Trading
Yes, you can trade forex yourself. But for that you need to learn forex trading. This might take sometime. You will also need to practice a lot in order to improve your trading skills. However, learning forex trading is worth the effort. It is indeed the longterm solution and should be your ultimate goal.
In the end, if you are new to forex trading, I would recommend the Forex Signals through a Trade Copier. This is the best solution. The professional forex trader is not charging any fee from you. He is trading his own money. So, he is taking as much risk as you will by copying his live trades using a Trade Copier. You might have to pay for the forex signals though. Good Luck!
Mr. Ahmad Hassam has done Masters from Harvard University. Download my forex trading system FREE that makes 100-200 pips per trade with a small 10-15 pip stop loss. Download this eBook, “How I made $2M in the stock market“, FREE.
Forex trading can be an extremely lucrative way to make a living especially on this present times advance internet based technology. The mixture of margin leverage and a low minimum amount required to start trading make forex trading ideal and attractive for a small forex trading investor. And yet, despite its vast opportunities for profit, majority of forex traders lose all of their hard earned money within a year trading in forex ( Foreign Exchange ).
Based on recent studies, these are the most common reasons that explain why majority of inexperienced forex traders fail:
1. Unlikely Forex Trading Profit Expectations
A lot of novice traders read about how easy it is to make money trading forex and they just take the plunge and lose enormous amount of their hard earned money before they even know what hit them.
Forex trading is not a get rich quick scheme. It requires hard work and research to be successful. And even then, you cannot expect every trade to be a winner. Even the best and professional traders also lose on tradunf forex. The key therefore, is knowing when to cut your losses and focus on the winning trading systems.
2. Failure to Acquire Sufficient Knowledge in Forex Trading
Forex trading is easy to learn, but difficult to master. Experienced traders make it seem so easy, but predicting currency prices is a complex endeavor. And as a small investor you are at a disadvantage. Large financial institutions have resources that you don’t. They may have an entire staff analyzing the most recent economic indicators while you just have yourself. You must be prepared to spend some solid time learning before you can expect to win big profits.
3. They Became an Addictive Gambler Instead of a Smart Forex Trading Investor
The forex market can be very addictive as well as exciting because it involves lot of money. Hence, a novice investor may tend to trade based purely on luck, just like a gambler does. I’ve seen people do this and they usually pick a few winners and make some short-term profits, but in the end they just get slaughtered.
On the other hand, a smart forex investor do a research and study the market before picking a currency pair and soon became a winner by earning a handsome profit.
4. Short of Focus
Depending on which broker you use, there are possible dozens of currencies you can trade. But on the onset especially when you are just starting out, think small. Pick a few of the most popular currencies, such as the US Dollar, the Japanese Yen, and the Euro, and concentrate completely on these major currencies.
The more currencies you trade, the more data you will have to analyze in order to spot trends. It is much better to know a few currencies really very well than to know just a little about each currency pair.
5. No Reliable Forex Trading System
To win at forex you need to forecast market development. Multifaceted systems work better than simple ones. And to be a profitable technical trader, you need to learn from proven forex trading strategies and currency trading systems.
But definitely the most important thing a novice trader to do is to choose a system that is easy to understand and easy to use. There are literally hundreds, if not thousands, of different trading systems available. Some you will have to pay for, but many are free. Choose a system that is right for you based on your capital, your goals, and your personality.
Without a reliable forexx trading system, you might as well be throwing your hard earned money in the dark.
6. Failure to Follow and Stick to a Proven Winning Forex Trading System
Having a forex trading system is not adequate. As a trader, you have to follow it through good times and bad times. Though it’s easier said than done, its easy to get greedy and go for the big score or get nervous and get out too soon. You must follow your system to determine both entry and exit points.
Do not ignore these or you risk of missing out on a big upswing or being stuck in a trade as it goes sour. Being a smart investor in the forex trading venture, you should know that knowing when to get out of a trade is even more important than knowing when to get in.
Everything begins with the right education. And learning to trade in forex market is no different. You need to get an excellent Forex trading education, so you turn into a successful Forex trader. Without the right Forex trading education and forex training, you will just be throwing your money away in the Forex trading market.
So, if you are someone entering into the forex market with the intention to make money in forex trading, then look for a mentor or a trading course that will teach you how to trade profitably. Check this website [http://www.insiderforexguide.com] to find valuable forex trading tips.