Id like to start of with saying a Big Thank You to the Babypips team. The school of Pipsology is by far the best resource available online for new comers such as myself. And off course all the active users of the forum i have learnt a lot from reading your posts and replies so thank you…
To give you a jist of my journey so far I was always interested in getting into ’ the market’ action. I always believed Stocks was the way to go just because thats the market you hear about the most. But when i really decided to start i began researching the industries and Forex seemed like the place for me.
Since i work full time I am moving a bit slow its been about 3 weeks since i have been reading and studying seriously. So far i have read the school of Pipsology, i am reading it again now and have reached chap 7. I have seen a whole lot of videos on Youtube and other forums and sites. ( The best video was Chart Reading 101 By Tom Long)
That being said coming to the reason I am posting here is because i am trying to understand and develop a Strategy and trading plan. After all the reading I have realized that I would fall under the trend and swing trader thats where i will be comfortable. That being said as a new trader I do not have much capital top put in at the most $1000.
Plan:
Look at the daily chart and find the strongest long term trends ( 200 day SMA)
Look for step formation
Go to a smaller time frame (4h or 1h) and look for an entry and exit. ( i need to know how to proceed from here on)
I just opened a demo account today, my first one and I was totally confused. Off course not know how to work the station was big factor but also I had no clue how to use the right tools properly. I like using SMA and stochastic in the Daily screen as I saw in the video by Tom Long, but I am not sure how to narrow this down to a smaller time frame.
My purpose here is simple use the demo account to understand charts and the station. try different strategy’s and record what i see to eventually be able to create my own trade rules. But i need to know which is the right tool and the right way to use in it in a specific time frame.
I know its a long post and I will appreciate all the advice (and criticism if any) that you have.
Welcome to BabyPips. This site is a fantastic resource to those new to trading and advanced traders alike.
I maintain a thread to help newcomers like yourself out. This thread contains several strategies to help get you started that are contributed by myself and other members in the interest of helping those who are still forming their strategies.
Hey Bee44,
Welcome to Babypips, I started learning and trading forex because of the school here as well. It provides some essential info, but it’s mainly all basic as it does not get into the details as much if you wanted to trade efficiently, if that makes any sense.
I must say though, I’m quite impressed that someone beginning is starting off with such long time frames, good on you! Most beginners, especially if you’ve only been studying for 3 weeks, will tend to scalp rather than wait for more reliable set ups.
I’d just like to point out though, just a personal opinion, demo while you learn, but also, make sure your demo trades are practical meaning you’re not over-leveraging your account, and essentially creating bad habits once you feel confident enough to go live. Also, since I noticed you are using indicators, I would say you’d need to trade a bit more mechanical as that will develop your emotions in a trade. I would strongly recommend that you get a good understanding of all the basic and more popular trading tools, but later focus on a couple or few which you feel you are confident to trade with.
Personally I’d study price action trading as it is discretionary. But most people would say you need to have a bit more experience before you can learn and study naked price.
As for your small balance, $1000 is quite a hefty sum to be trading with! I started with $200. But I’d say that’s the bare minimum. Remember to think in percent (%) gains and not dollar ($) gains or pip gains (making 4 pip profit with 2 pip SL is the same as a 400 pip profit with a 200 pip SL since your risk is adjusted accordingly). Adjust your lot sizes based on risk and SL size and not the other way around. Eventually consistency and compounding will do its magic. Focus on high reward to risk ratio (>2:1)trades and you will do just fine!
Hi Tradetilidie and clark… thank you for your replies
@ trade : I checked the link you sent to me, it has some great information but i think it is a bit much for me at this point. I need to better understand the basic before i jump into trying to understand pip counts. I plan on studying that next so hopefully in a few days.
Clark : some great tips there will def take that into consideration.
I think step one for me right now is to find the right trading station so i can get a hang of the station and its while learning the mechanics of the market.
Just one question:
Do you change the rates/numbers on your tool of choice when you change into a smaller time frame?
I would say find a broker that offers MT4, as it is widely used among most brokers. MT4 also offers a lot of customizable features. I strongly recommend find a broker that offers it. If you need help finding a broker for trading with low capital, send me a PM I’ll help you filter some of them out. I was faced with the same problems a couple months ago, so I have some experience to help you with.
As for your question, what do you mean by rates and numbers of my tools? Personally, I do not use any indicators or moving averages where I have have to the ability to change settings, I try to keep my charts clean, besides Daily Pivots, and a period separator, separating each day with a dashed vertical line.
PS. Also, if you REALLY are committed to trading Forex, I would STRONGLY recommend that you take a look at the thread: “What Every New & Or Aspiring Forex Trader… Still Wants To Know”. It’s video tutorials, taught by InnerCircleTrader. He’s got 17 years of trading experience trading six and seven figure balances. It’s a straightforward system, no lagging indicators and pure price action and an understanding of market mechanics. You’ll really find it useful. Granted, it will take a decent amount of effort to understand at first. But hey, we all go through that process eventually, and it’s the people that trudge through it that succeed. =)
