Is trading Forex right for me?

Beginner Questions
1

Hey all,

I’ve been learning the basics of Forex for a few months, and I’m wondering if it’s really right for what I want to do. For a little background: I work a job that has a lot of downtime and a fair amount of time off, and I was initially intrigued by the concept of day trading, since it would work really well with my schedule, and as a (potential) supplement to my current income. Some research into day trading led me to trading Forex, and subsequently to here.

My issue is that after some time here, I’ve learned that day trading and scalping are definitely not for beginners, and that longer term trading is better when you’re first starting. If my goal is to eventually day trade or scalp, is Forex the right thing to be trading? Would I be better off learning to trade options, or stocks, or something else?

I appreciate any and all input, as I’d hate to really put in the time and the effort only to find out that Forex trading just isn’t what I’m looking for.

2

Your job sounds ideal for chart analysis and entering exiting trades manually .
Digest everything you can here and over on forexfactory Forexpeacearmy
Demo first with any of these , Pepperstone Hugosway Oanda before going live .
Scalping takes a certain skill and kindest I prefer short term swings but if you really want to scalp go for it !

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3

you can as a beginner do the day trading and scalping
provided you use a low leverage , set your stop loss and be supplied with possible entry and exit points
good luck

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4

Intraday trading is indeed very demanding, but then everything in trading is demanding in some way or another. Just as it is in any skilled profession. There is no casual or easy way to earn money without putting in the study and practice.

Trading longer term off daily charts in not out of the question for you since you can put stops in that limit your potential losses even when you are not there to monitor it. But that does not give you a lot to do on your time off.

Daytrading is certainly an option in your circumstances but you need to develop a method and trade it with strict discipline. One of the biggest problems with daytrading is that is defies our human thinking processes which always seek logic in what we are doing. But markets in the short term do not have any such logic and can move very erratically - especially when there is not much going on!

Perhaps a typical scenario might help demonstrate what can easily go wrong with short term trading. Here is a 5min chart of US30 index covering a period of only about 3 hours during the NY session - a time that most daytraders would recommend because it is active:

Point A: You have drawn a nice, firm upwards trendline(red) and you buy in - and sure enough the next 5 min candle moves higher - Yippee, looking good.

Point B: The price then drops over the next few candles and breaks your TL and you are stopped out for a loss!! Oh no, its a fakey! But never mind! It broke the TL so it must now surely go down, so you sell it and double your position size to gain back your losses…

Point C: Two strong up-candles and you are stopped out again!! Hey, but it is now back above that TL so it really must go up now because this confirms the uptrend. Logical! So you buy big on the basis of those strong candles…

Point D: Price has again crumbled!!! You are again stopped out for a big loss! :persevere: But this is now again looking weak and, hey look! there’s a double top just formed as well to confirm the downside! But you have lost too much already so you only sell a smaller position this time, hoping to at least retrieve some of your losses on the day - and place a tight stop, just in case…

Point E: Market rises just enough to stop you out and then stops dead. You have now removed most of your hair and even your fingernails are almost extinct…but you are now very much wiser and you decide NOT to buy into this, this time . you are learning! :+1:

Point F: Feeling smug from your wise decision not to buy at point E, you now sell here big and with great confidence that this time…

Point G: You are stopped out yet again!!! And, what’s more, the high is back to the same level as Point E !!! You are now so frustrated with your string of losses, even though you have traded entirely “logically”, that you impulsively apply revenge trading and whack on a buy with such a thump that even your mouse wails in pain! This is the big one, This is the make or break trade . This time I will get everything back plus a bonus for my efforts - just wait and see!!!

Point H: The market doesn’t just fall, it literally dumps on you, heaping insult onto your financial injury and you are history - and the market commentators report that it has been a very quiet uneventful day…

2019-03-03 5m
2019-03-03 5m1211×882 19 KB

This is a real chart from 28.2. but daytrading is not, of course, always this bad! It is just an example of what can, and does, happen sometimes if one is not prepared. And, of course, we do not know until after the event, what kind of day it is going to be!

This is only to illustrate that one needs experience and a good method to cope with these kinds of days - it is not intended to scare you off! :joy::joy:

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5

I used to have a job with a lot of downtime, started long term trades on my phone and went from there. Need a bit of concentration for scalping so would probably stay away from that from the time being. I’d open a demo account and see where you go from there :slight_smile:

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6

Hi, Tannhauser,.
I wish I had “down time.” I have and still do work a lot of hours every week.
I have also tried many things over many years as time (and remaining energy) has allowed. My trading used to be fantastic over a few months, but then, for a few months, not so good. However in the last year or two things have been more consistent, as I have distilled what has worked by looking back at trade records and methodology during that time. Kinda like some of the things Raghee Horner says: understand the parts (EUR/USD - know both -see that the USD is bigger,etc,.) find the trend (she uses MA’s - I use channels,) find support and resistance. Those are three important things, I also look for divergences, but because I use an end of day capture system (orders above and below the current price,) I still place my orders regardless of that.
Yes, you can make money if you understand that it is all probabilities and use those numbers accordingly - like for money management.
All the best to you and Wagner.

7

Mannx!
Like a casino! Eh?

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8

Exactly! That was the point! :slight_smile:

I am certainly not saying that daytrading is impossible, I can’t say that - I’ve more or less always done it myself - and that is going back some years (more than I care to remember!)! :rofl:

But I do think trading off very short term charts like 15/5m does tend to suck people into a gambling type mentality whereas trading should be a calculated and defined process based on a clear set of rules/guidelines within a concrete set of risk/money parameters. This last issue is often the first to go overboard in the “heat of the moment”! :smiley:

9

Stocks arent too good for day trading unless you have huge positions. It is possible to learn to scalp intraday. you just need to find yourself a nice little strategy and stick to it. Just wait for the correct setup if you have the time and its very possible to grab a ncie number of pips daily which you could profit well off. Look at the trading systems in this forum, the HLHb looks nice and simple ive made a good few yrades ff

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10

I’m feeling the same following for advice.

11

Stocks could give quite interesting trading opportunities even with relatively small capital, but stock trading is mostly for professionals. As there are more stocks than currency pairs, you would need broader understanding of the market. Next thing you need to be familiar with is trade execution. Stock hawe such criteria as Float, and the volumes are real, so other traders would influence your trading and sometimes even your trades would influence the prices - for those, who specialize in Forex, this could be unusual, so some FX-based strategies may not work for stocks. Thus, equities market is just another universe with own rules and principles (except some basic ideas form Technical Analysis). At the same time, non-market risks for stocks are lower, than for FX. That is why it would be better to make your own research and find something that would be better for you personally.

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12

This is really helpful Thankyou.

13

I agree scalping is very complicated and should be left well alone until you know what your doing trading.

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14

In my opinion, it doesn’t matter whether you want to trade long term or become a day trader. So long as you use the right strategy, trade withn stop loss, and be disciplined in following your plan, you’ll be good to go. But I can’t encourage a beginner to trade options

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15

Welcome to the forex trading community. Here, you’ll get all the baby pips that you need to succeed as a trader. From my experience, forex is the best for a beginner since the risks are not as high as in binary options. Ensure you start with demo and get all the basic knowledge first.

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