Нow to trade forex on your own
How do I start?
You can hardly think of anything new here except self-education. The most useful, in my opinion, is reading comments and blogs of specialists, following the traces of specific news and situations and the market reaction to them. Reading books is useful, but it should be held in the background as auxiliary material, expanding the knowledge base of a new trader. This way, a person will always understand what is essential and what is not, how the market reacts, and what it leads to. At the same time, from such an intelligence battle, you will immediately see whose advice is good, and who is just a master of reasoning about the past.
It is even better if your guru is a practising trader himself, who is not ashamed to talk about specific levels of opening and closing deals. But this is already a rarity. As a rule, everyone prefers to give advice or trade without disclosing particular strategies. But this is the last century; openness is more and more welcome. Among other things, it is helped by various signal services, where it is possible to copy the real trading activity of another person.
Still, it does not relieve you from the necessity to study all the routine trading process and all the nuances before putting real money on the line.
Is it worth reading books? Books provide fundamental knowledge, but often there will be a problem of their application in specific situations. Also, it is now easy to find one or another definition using search engines. So my first advice is to find a worthy "teacher" (it can be blogs, analytics from forex brokers or even investment banks).
Further, we try to understand what the professional advises, what factors (technical or fundamental) he pays attention to, and what perspective he is looking for. If his style suits you, try to trade on a demo account according to his recommendations. At this stage, you do not risk any money.
With what amount?
This advice is most often heard when investing in equities, but concerning high margin forex trading, it is more relevant than ever: determine for yourself the amount that you can lose without threatening the financial well-being of your family. Because the truth is, you can lose everything here. On the other hand, high levels of leverage allow you to form very impressive orders compared to the amount of capital you have. Now forex brokers' leverage can reach 1:1000, often 1:500, and 1:100 is considered a classic. Forex is less volatile than the stock market, so the leverage is higher than you can get on futures (1:15) or liquid stocks (1:2).
Do not be tempted by the fact that you can set any large amount on a demo account. When trading, it is essential to be able to draw down your account. It is when you can "outrun" a trade's losses or a whole series of failed deals. It is often the case when a trader gets a margin call, and then the market turns in his direction. Having a large depot on the demo and a small one in real life, you will stay in the game in the first case and get a margin call in the second, which is the most offensive, agree.
If we talk about real figures, then for standard forex (I'm not talking about micro forex, where the lots are ten times smaller), it should be at least a thousand dollars (at least one). Still, the trade should be either very short-term or minimum volumes, as forex is a high-margin market, where there may be large drawdowns.
How to choose a broker?
First of all, choose reliability and thoroughness. After all, this company will keep your money and execute your orders. Previously, companies that provided access to forex were dealers, not brokers for their clients. That is, they took the second side of the deal and played against their clients. Mostly, even then, it concerned small companies, the big ones did not sin it, due to regulatory requirements.
This business model still exists but is gradually becoming a thing of the past as the industry develops and matures. It was called a market maker model. The agency model, on the other hand, is a more acceptable option for clients who do not want to carry money in the "kitchen". According to the agency model, the company receives quotes from the world's leading prime brokers and redirects them to its clients. Those, in turn, collect quotations and applications from many banks.
It turns out that the task of the forex broker is to provide the trader with a convenient trading terminal and choose a suitable prime broker. And, of course, the collection of modest, rather than robbery fees.
Nowadays, in Indonesia, there are more and more opportunities to open an account with a foreign company, regulated by stringent EU or British jurisdictions. There the best bid and ask quotes are strictly monitored, and the protection of the client's interests and his capital is considered. How do you know how reliable the company is?
Look at where the company is registered and in which jurisdictions it is authorised to operate. In Britain, the FSA has a very demanding approach to licensing. In remote parts of our planet, it's easier to do so.
Is it possible to learn by yourself?
Of course, you can't go anywhere without self-education. And I advise you to start with your learning. Only in this way you can understand what this or that lecturer tells you on paid courses or in a smart book. Roughly speaking, you can say as many times as you want to buy cheap and sell expensive, but you have to form an understanding of how you determine where "cheap" and "expensive.
And when you know the terminology and how it works, you will be able to listen to other people as effectively as possible, try their ideas and approaches. The main thing is, don't let them mess with your brain. You should always understand how this or that signal is formed.
And even more, you must think for yourself in this direction, and the specific signal, about which this or that interlocutor or strategy speaks, should only increase your confidence in the correctness of your chosen strategy.
Which trading instruments should I choose?
You should focus on your trading style. The oil will require you to become an expert in geopolitics in addition to observing supply and demand fluctuations. Many people like the Euro/USD for being the most popular pair and all news feeds are filled with information from the Eurozone and USA.
For example, this pair seems to me to be suitable for fundamental long-term analysis, generally working on short time intervals in terms of technique (15 minutes), but entirely useless for forecasting in the medium term. False breakdowns of previous extrema are persistent for this pair. I like the way the regular standard RSI works on four-hour candlesticks in USD/JPY (which is position trading with one or two trades per week), but the same rules are challenging to apply to EUR/USD.
It is also challenging to apply them to cases of increased volatility caused by external factors, be it interventions (both verbal and physical) or crises of companies, sectors, the entire financial system. Determine what type of traders you are and are looking for your instrument.
Also, pay attention to volatility. There are moving pairs, GBP/JPY, AUD/JPY, AUD/USD, and there are almost "dead" pairs, like the euro/franc most of the time. And, if such "dead" pairs come to life, it will not seem to everyone. There are crosses, as a rule, these are the currencies of one region, which fluctuate within a range in the long term. These are EUR/GBP, AUD/NZD, as well as the crosses of many European currencies with the euro.
Try to make your observations, even if they differ from the findings of colleagues and friends.