What are the main steps to start forex trading for beginners? This 5-step guide will help you get on the right track:
- Education. Do some research and look for detailed articles, videos, and webinars after learning the basic jargon of FX like swaps, spreads, lot, bid-ask. Here at BrokerChooser we have lots of articles prepared for you in our ‘How to Invest’ section.
- Open a demo account and get familiar with charting and fundamental research. Many brokers offer demo trading accounts without any restrictions. For example, you can look at our list of the best forex brokers for beginners. After registering, you’ll have access to a trading platform with a virtual wallet. Feel free to make trades and experiment with all the features. It’s a good idea to trade the same amounts as you would with real money in order to get a feel for how you can tolerate swings in your balance. Using a demo account can be the best way to learn forex trading.
- Find the best broker for your trading style. Maybe you were impressed with the demo account and ready to go ‘real’, but if not, use our Find my Broker tool or the ultimate Comparison tool for a more refined search that is tailored to your needs.
- Open an account and deposit (a small amount). This is really important – as your capital is at risk, don’t deposit too much! The bare minimum is often enough. If you are unsure about starting trading for real, don’t do it; stick with demo trading until you are comfortable with the risks.
- Do research and build your strategy. Get familiar with the economies represented in the currency pair of your choice. Build a strategy that you are comfortable with following – be it based on technical or fundamental analysis, or both. See some of the most popular forex trading strategies. Use risk management tools to avoid big losses. Having a trading journal can also help you identify your strengths and weaknesses.