Posted by forex at 4:29 AM
Read our previous post
1. Open a virtual or simulated Forex trading account. Many brokers offer this service to their clients, and most major Forex brokers also offer a 30-day demo account for prospective clients. It is essential that new traders interact with the Forex market using fake capital until consistent 'profits' are achieved.
2. Plot Forex currency charts inside the trading platform you are using. Both demo and live Forex platforms usually include comprehensive charting features.
3. Study the Forex charts for signs of trending activity. Although there are many techniques to Forex trading, trend analysis is one of the oldest and most important methods for training in this market.The Dow Theory first defined a 'trend' nearly a century ago, and this concept is still used every day. An up trend is defined as a sequence of 'higher highs and higher lows.' As prices fluctuate, they create new highs. The declines off these highs don't fall as low as previous declines.
4. Buy into the Forex currency using the demo account when a trend is identified. Many traders wait until a decline has occurred after a recent new high. Then they buy into the currency with the expectation that the trend will continue.
5. Sell the currency in the virtual trading platform when the trend is no longer intact. If a decline off a new high creates a lower price than a previous decline, or if the most recent high is not higher than the previous high, then the trend has broken.
6. Trade Forex in the virtual account consistently until you acquire confidence and fluency with the process of identifying trends and transacting orders. Only after you succeed in the simulator should you consider funding the account and using real money.