What did I learn from Day Trading Forex for 8 years
In this article I want to share my personal experience in the Forex industry for the past 8 years. I will give you my honest insight, bring some clarify and hopefully answer most of your questions so that you can decide if Forex is for you.
Like many people I was always curious what is Forex trading online all about and can you really consistently make money.
As you know Forex Market is the biggest market in the world with transactions exceeding 4 trillion dollars daily. Forex has been around for a very long time. It started out with world banks exchanging currencies and throughout the years it added smaller investors and speculators.
In the last 20 years Forex became available to retail traders like you and me through Online platforms which allowed regular public to participate in this huge market with very small initial investment.
Retail Forex industry has become very hot online with ads claiming that you can quickly learn an easy strategy and trade from the comfort of your home. This attracted many people to start trading online, learn different strategies, participate in forums, build software programs to trade for them and much more.
When you start learning about different strategies in Forex you will quickly realize that there are several approaches in the market for traders so that you can choose the strategy which fits your personality best. Here is what you will find:
- Fundamentals (news trading)
- Technical Analysis (indicators, price action)
- Expert advisers (software programs based on coded strategy)
- Rule based strategies (when you have to follow exact rules to trade)
There is endless information about online trading Forex systems. Your first impression will be very exciting and of course you will find many articles that people can make money by day trading Forex.
Let me share with you my personal story so that you can see my path and what I discovered along the way. This will shed some light in your journey:
I started out Forex trading like many newbies based off some Free systems I found on www.forexfactory.com and www.forexpeacearmy.com. These were rule based systems. I read lots of information online and worked my way finding success but few months down the line I was simply breaking even and then started even losing money.
Then as I remember in 2008 I learned what is automated forex trading. Expert Advisers or robot trading became super popular when Fapturbo and Forex Megadroid came out. This is where I seriously made my first money. I invested $300.00 and a year later it turned in to $3500 and I got extremely happy. I thought that was a way. Luckily i withdrew most of my money as I needed for marriage and kept only $500.00.
Few months down the line these 2 robots became so popular that it seemed market had changed during Asian trading session because of them. They simply stopped bringing consistent profits and even resulted in to losing money eventually. I have tried numerous FX robots with no consistent results and finally gave up on it and decided to invest in REAL education.
I have studied in Forex Trading Institute online and took a course of so called: “Thin Slice Trading” by Steve Rising. I spent about $2600 on his program and it took about 8 months to learn his scalping strategy.
I was then working on mastering the technique spending 3-4 hours online 4 days a week. My eyes were burning because you had to be very patient to wait for the right setup to form and wait for all the rules to apply and only then take or leave the trade. Well guess what it turned out this guy was a SCAM. After some time he disappeared.
Here is what you will find in Forex Online a lot:
- There are only few real successful traders
- You will learn about thousands of trading programs which will promise you huge earning potentials and mostly they are SCAMS
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Ask yourself a question. If you were making millions trading Forex – would you tell about your success to everyone? You will mostly find people who talk about success online are the ones to sell you something and they make money from subscriptions and selling useless programs. I can list various subscriptions and programs I have tried to stick with but this article will be filled only with those names.
I then started looking deeper in to the market because I always had a question:
“Why this market is so unpredictable and who is there behind the scene constantly trading against you”?
This is where I discovered Volume Spread Analysis (VSA) trading. I found this to be the most complete way of understanding Forex Market.
Market Makers – these are world banks, financial institutions – who can see all our positions and who regulate this uncontrolled market. By studying VSA you work on mimicking market makers and taking trades in the same direction market makers do. Your job is to read what market maker is doing and trade with him. If you are serious about spending time and learning this market inside out you should read more about VSA approach and consider it.
Although even this type of approach does not let you see everything but at least you are geared up with best odds to make better decisions and have good reasons to take trades.
Here is another secret I want to share with you when considering day trading:
- Are you disciplined?
- Are you greedy?
- Do you want to get rich quickly?
Forex is based more on psychology than actual technique. It is often compared to Casino and there are many articles you can read online which talk about psychological techniques on how to approach this market. If you didn’t know there are only 5-10% of traders who are successful in the long term – most people fail and quit within the first 1-3 years. This is not a place where you master one technique and it will carry you through the whole life – you have to work on your ambitions, see what market is doing and always take decisions with cold mind. It is constant work just like any other business.
When you are trading you will have both winners and losers. Idea is that your winners are bigger than your losers. If your ratio comes profitable that means you are on track and you are doing it right, but you can never relax because it’s easy to screw up. Keep yourself always in check.
Here is the check list for you to keep in mind:
- You have to learn to pass on trades
- You have to stay out always when in doubt
- You need to think about not how much money you will make but how much you will risk
- Your mind should be cold and when you are trading there should be no external distractions
- You simply need to have a good mood. Many traders take bad decisions when they are ambitious.
I hope this information will give you some piece of mind to see a bigger picture. I personally quit trading for the reason that I realized I was lacking many qualities needed to become successful consistent trader and simply got burned out. I even think having a day job is better than trading Forex for most people.
After I quit Forex I was very lucky enough to find online opportunity which perfectly fit my personality and started working for me in a short period of time.
The best qualities I built in Forex were: Hard Work and Dedication – and this is what is helping me now in my new business adventure.
You can read more here on How to Get Started Online
Wish you all the best and please drop a comment if you have any experience in Forex or have something to share: