The PERFECT system for newbies

Beginner Questions
1

[B]THERE ISN’T ONE[/B]

For those of you who came to this post hoping against hope that you could “get rich quick” I apologize. [B]But please read the rest of this post.[/B] I promise it will help you in the long run.

As a new trader, most people are two things.

  1. They are skeptics, thinking forex is a scam and want all the information they can get before they even think about investing their hard earned money.

2)They are people who want the easy way out and want money to be handed to them. And hope that one of those offers on the web will do just that. (better to be option 1 in my opinion)

[B]The fact of the matter is, is that forex is a job, it is a business.[/B] It is not a get rich scheme, and it takes discipline and practice to master.

Think of it like a swimming lesson. First you go to a class where an instructor tells you the basics of swimming (the Baby Pips School of Pipsology).

Then after you understand the concept of swimming, you start out in the kiddie pool learning how to keep yourself afloat (reading this forum and opening a demo account).

After you can keep yourself up in the kiddie pool without touching the bottom for some time, you go into the main pool and learn to swim laps (opening a mini or micro account and trading only 1 lot at any given time).

After you become confident in the swimming pool and go off the diving board a few times, you talk to the experience scuba divers (expert traders here on baby pips) and start perfecting the art of swimming with the sharks (trading for a living).

Then, and only then, when you are comfortable with all that can happen, when you learn not to panic underwater (or losing trades) and when you learn to control your breathing and not get to exited, are you ready to swim in the ocean.

Of course, there are always though who just jump in and it’s sink or swim. In this case you are gauranteed to take several mouthuls of water (lose alot of trades) and you could possibly drown (lose your whole account and not be able to return). Sure this way is much faster if you make it, because you learn from your mistakes, or you die. But, ask any life gaurd, or anyone who swims alot. If you throw most people in the ocean (probably 95 percent), and they have never swam a day in their life, they will die. This is what most people do. This, or they go straight from the kiddie pool to the ocean and freeze to death, get eaten by a shark, or drown.

You, as newbies, need to practice practice practice. Don’t jump in untill you know all that can happen and know what to do in each situation.

Practice trading, practice keeping your emotions under control, practice not biting more off than you can chew (overleveraging) and above all [B]PRACTICE FOLLOWING YOUR SYSTEM.[/B]

After reading this post a few times, go here 301 Moved Permanently and read that post two or three times.

Don’t be afraid to ask questions, don’t be afraid to try things on your demo account. And definatley don’t be afraid to admit you have weaknesses and focus on strengthening them.

I wish you all the best of luck, and hope to see you all in the winners circle.

2

63 readers and no replys???

It is either so good that people are awestruck, or it is so bad no one comments. I will assume the best :slight_smile:

3

I like your analogy pipper :slight_smile:

Pretty much sums it up!

4

This is a good post. For any starter in forex, they must practice their strategy on a demo account first before getting into the real market. In addition they must treat their demo account like a real account and trade like what they will do when they use their real money to trade in the future.

5

Thanks Ray,
Yes trading like it is real money is also very important. The easiest way to do this is after a trade, look it over and ask yourself “How would I feel if I gained/lost this much?” Really mull it over.

What I do is I take a look at the money I have saved up, and ask myself how I would feel if I lost a chunk of it, or if I made it grow a chunk. Then I will ask myself if I was lucky/unlucky, or did I make the best decisions during the trade. Learning how you react to the outcome of your trades will be a potent weapon.

6

this is really good post for the beginner. Everyone who just start forex shpuld read this first before thinking about how much money they will be making. Keep up good post Paythepipper.

7

Yes I agree with you it is easy to get happy when you win but it is real difficult to control your anger when you lose. For now with my demo I have learnt to enjoy the trading as a game, keeping in mind that I have to develop a strategy for when I really invest and then on it won�t be a game.

8

I agree 100% I believe that most New traders are drawn to Forex for instant riches. I believe they are there, but instant is a concept in it’s own right. Many people study for years for advance degrees in one thing or the other I know many. Most never acheive their goals of riches instead are overcome by school cost debt. With Foex if you give the same attention as you did to School and really learn it.T he riches are there at a very low cost, As in this sight for free. Yes you will be on your own here but you are adults now. Take each part and study it piece by piece, and you WILL be successfull.

Looking through this forum at different threads you see many disagreements of trading style almost becoming ugly. They are all right there system works for them. If you are deligent you will see what works for you . But continue and keep educating yourself as different times require different stratigeis. I am successfull at scalping as well as I am trading short term as in 30 to 45 minute trades. I am still learning the longterm style of trading which to me would be the ultimate. Set it forget it, check on it now and then …

Anyway keep your nose to the grind stone and your eye on the prize and you will succeed… Good Trading to All, and rememeber it isn’t luck,:slight_smile: it is equal to what you put into it.

9

Very Strong Post…I like it.

It reminds me of an author names Stephen R. Covey.

In a part of his works he explains that all things in this world and life in general have a cycle of events, and if those events are done correctly they lead to success.

I do not have the book infront of me…but something along the lines of:

You cannot harvest a crop if you don’t plant the seed.
You cannot plant the seed if you do not prepare the land.
You cannot prepare the land if you do not own the land.
You have no reason to own the land unless you want to harvest the crop.

One other quick thought…somebody said that Forex is not luck…well…sure it is, in my mind. That is only because I look at “luck” a little different than most people…

Luck: When prior preperation meets opportunity :slight_smile:

Happy Hunting :slight_smile:

10

That is real sage advice, I hope some heed it.

11

Lack of knowledge, lack of experience, + complete blithering idiotic GREED = most green newbies.

Above is the biggest problem I see. And please, if you are a total newbie with limited funds (meaning well under $10,000), don’t ever ever ever calculate your lot size using that convoluted “risk reward stop/loss optimized” risk lot size calculator. Please!!! I know you all get sucked in by looking at the conventional simple lot size calculation VS risk/reward stop/loss ratio based calculation. What the crap does not tell you is that because you will be using stop/loss, you will lose often and since you are risking more than you would using the simple lot size calculation, you will lose more when you do lose. When you risk more, you will lose more. That’s really complicated isn’t it? Keep it simple OK? Get rid of your greed as well.

12

I saw that someone recently like this post. Even after it was burried so deep. I thought that I would give her a bump, and reccomend that all newbies complete the SCHOOL. The format is fun and I am going through it again!

13

Does anyone know of any good classes (face-to-face)in Melbourne Australia that teach basics of forex trading?

14

Thanks for the posts it’s been a good advice.

15

Good advice

I approached it as #2, then became a #1 and now that I’m working my way through Pip School, my expectations are now settled where they should be. I don’t know if I’ll ever trade for real, but I’m going to go through the school and try a demo account for 6 months and see how it goes. If I enjoy it and am decent at it, great, it’ll be a nice business to expand into. If I don’t, I’ll know a lot more about how one part of the world works. But I’m under NO illusions that I’ll put $100 into a slot machine and walk out with a new car…

16

even then, a demo account gives a false sense of achievement imo and you dont get the real feeling you have when juggling around real money that you can actually lose, you have more confidence and it will be easier to resist closing down in panic. Demo accounts are only part of the practice. And i wholeheartedly agree with the poster here. Today i got tempted to do things ‘by the book’ again and it cost me. On a second account where i did things ‘by my book’ it cost me nothing. All too true. Find a number that works, so to speak. I dont think its very likely anyone will ever succeed without a few burn marks to boot as well, learning from those is probably the most important and i shouldnt be talking like a pro since i havent been in it for even a full year.
However, sometimes the pro’s seem to say the same things all across any and every site, and still they’re not billionaires so im kinda starting to doubt there’s actual forex pros other than the people who write the yearly reports and projections for the big banks. For the rest of us its … well, going with what works i suppose.

17

Watch video tutorials if you want to get the experience of Face to Face discussions. You don’t need to attend classes to be successful in trading. Just my thoughts

18

Good post. Must have inspired many traders and newbies.