I am not a newbie in forex trading but with my over 5years experience and a worldcup trading champion, I want to share a little secret in this business for newbies to be successful. Many people asked me, Sir can you trade for a living? My answer has always been consistent as YES provided you understand the currency pair chart. Forex is 90% psychology and 10% technical. Before you begin to trade, check your equity balance and the amount you are willing to risk it. Money management is the most important thing you need to survive in this business. Never be greedy to trade high lots. The second thing is to understand the candlestick pattern very well which will predict the future movement of the market. Forget the news, whether important or not, the candlestick pattern always gives a clue of the market movement. Knowing the pattern makes you 99% winner. The last thing is when to enter and take profit. Fibonacci ratio is the best tool to use for entry and exit. Always start plotting the ratio from a higher timeframe to at least the 15min timeframe. Observe the various significance levels. If you are expert with indicators, you can add it to your chart but from my personal experience, the candlestick pattern is the most important. Sometimes the indicators fails so don’t rely on them but you can fully rely on the candlestick pattern. For day traders, you can also observe the daily pivot level as well which is very important. PLEASE : Anyone is entitle to express an opinion about this but refrain from ill comments or hash words. Lets share experiences to encourage and teach newbies. Remember, brokers are always in profit whether the market is against you or not
Hi oseikp! Thank you for sharing this! I’m also looking forward to seeing you share your trading experiences and skills with the rest of the traders here.
See you around!
Thanks for the advice! Would you recommend any books for a beginner?
Nice post. Along with looking at candlestick patterns, draw your major resistance and support lines. Also, you need to recognize chart and harmonic patterns as well. For trade confirmation, use RSI/MACD/STOCH. If you like other indicators, use them but don’t rely only on them.
How can you ignore the fundamental events?
I can’t recommend any specific book but any book that teaches candlestick formation is very important. With experience, candlestick formation predict the direction of the market. Know them of head and it will change your trading style. cheers!!!
@Peter_Siddle The candlestick pattern together with fibonacci ratio will tell you what to expect from the fundamental news. I have tried this for several years and it has never failed. Even if it turns in the opposite direction, the market will move back to its expected direction after 15mins of news released. This is where money management is utilised very well. Let me give you an example, yesterday April 20th 2018, I was telling some of my students about the direction of the USDCAD pair and where to placed their buy order to awaits the release of CAD CPI (m/m)(y/y). The USDCAD pair has already given its direction in all the timeframes. I will advice you to start practising this in a demo account and you will soon realised this. The only thing that predict market direction is the candlestick pattern formation
Here is my opinion. What a lot of marketing bull. Reckon the sales pitch will come out soon. All the classic marketing lines are coming out. Candlestick formation is no more capable of “predicting” market direction than the monkey I have sitting on my kitchen bench throw darts. Odd numbers I go long, even number short. Theres the real secret.
Candlestick formations are one of those things I see everyone use, yet I can’t grasp the logic behind it. Hanging man, shooting star, pin bar, gravestone, dragonfly, hammer… they are all the same thing, aren’t they?
A candle with large wicks and small body that suggests a possible transition of power between buyers and sellers. There are small variations, but pretty much all “reversal formations” are just that.
What is the point in learning them as patterns? Just figure out the logic behind the individual candle and you won’t need to memorize any pattern.
Awesome thought. This will guide you in your decision when entering a trade.
What you have said are really good advice for newbie. I disagree with one aspect. You talked about Fibo. You said it is good for entry and exit. But what if another trader doesn’t find it that much useful. To me best strategy is the strategy that suits you. Everyone’s personality and understanding is different. What works for me may not work for you. That’s the reason trading is not science.
In order to my trading experience , I think everything is open secret about Forex trading , for keeping survive in here with making profit we need good knowledge and long term experience including a reliable support from a credible trading platform , that’s all.
yes , it is. i always emphasis the importance of a right broker , because they can affect the result of our trading with certainly.
here we go… Next will be bearish, maybe imbest and mlawson will shed their wisdom. Another thread heading to the dogs.
Thank you OSEIKP for your profound and inspiring advise,
it takes a mentoring spirit to take time and write as you did.
Keep up the good work.
Newbie
Good broker is important but main role is of your trading what you do in market. When you are face to face with trading atmosphere here your ability is showed off. Market is equal for everyone .Here no body can get benefit without proper knowledge and real skill.
i know market is equal for all, but sometimes broker can affects the result of our trading , that’s the real problem
Thanks for sharing a nice thread based on your own trading experience. As a new baby, I am appreciating your step to help the new babies. And yes, it is true that over trading can be hazardous and money management to achieve the trading goals is essential.
For Newbie Traders, I would be recommended start reading basics from Babypips - School of Pipsology its one of the best and easy tutorial
@TomCooper @imbest some brokers can affect your trading such as slippage but as a newbie, how can you know? It is best to trade on a demo account to observe all these before throwing your hard earned money on real account. Another thing is look for spread. Nowadays, there are free automated spread on the internet that you can download and add to your chart. For example, EURUSD pair is the most traded and liquid pairs on the market, so if your broker is providing a spread of 5 and above, be cautions. BONUS TIP: Candlestick formation is grouped into 2 (Reversal and Continuation) Always check on the higher timeframe (H1, H4, D1, W1, MN) to know the formation. This will help you in your decision. For Day Traders, daily pivot level is extremely important. It is a level you can take maximum profit for a day or enter a trade for full potential profit.