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People around the world make a living from trading forex. Here’s a step-by-step guide on how to trade forex for a living.
Ultimate Guide on How to Become a Successful Full-Time Forex Trader
The forex trading industry has advanced rapidly in recent years. It’s accessible, stirring, educational, and offers traders a sea of opportunities. Unfortunately, many traders don’t do very well in this market.
In fact, a large percentage of them are losing money. Learning Forex trading and how to trade in general can be quite a difficult task. This is where we come to your rescue.
Today, we’re going to teach you the ways to trade Forex for a living, and how you can trade easily on the live markets. This article covers the best trading practices for beginners. Trading is putting your money to work with a high degree of success. I’ve already provided a few downloadable calculators and my guide to investing for passive income.
Here are some of my favorite downloadable models:
You can check out my book Dividend Investing Your Way to Financial Freedom, or download a free 5 chapters of the guide below:
Use top forex books to expand your knowledge about trading and to formulate a strategy that works best for you.
So, without further ado, let’s dive right in.
Getting Started with Forex Trading
The first thing to keep in mind when it comes to trading forex is to know what you actually want to achieve. You need to set yourself a goal that’s both realistic and quantifiable.
For instance, get a 20% annual return on your investment, make a profit of $5000 dollars, achieving a total of 100 pips per month, or something similar to that.
No matter what you decide, your goal must be easy to measure. Also, you should set a goal that’s achievable over a long time frame. We recommend setting an annual goal to achieve instead of a monthly goal.
Once you set your trading goal for the year, it’s time you learned how to get there. You need to identify the available resources, such as the amount of time you’re willing to spend on trading, the size of your deposit, and the number of available funds you want to spend on trading-related matters.
Since you already know what your goal is and what you’re prepared to put on the table, it’s time you made an action plan. This plan must include the currency pairs you’re planning to trade and the number of trades you’re going to commit to.
However, this can be hard to achieve without having a working strategy in place. Therefore, you need to build a template for your action plan and move on to the next step.
How to Trade – 7 Easy Steps
Let’s get into how to trade forex for a living. In order to learn, you have to figure out how to start trading. Period.
Step 1: Battle Procrastination
This is an important step in Forex trading. Successful traders never procrastinate. You need to seize every opportunity you get to achieve your trading targets. Consider developing a habit of never putting off until tomorrow something you can do today.
For instance, something as simple as trading with a demo account can help you with battling procrastination.
Step 2: Keep Practicing
As we’re talking about demo trading, it’s fair to mention the famous saying that goes something like “practice makes us perfect.” With a demo account, you’re able to practice to your heart’s content.
This can be quite helpful if you want to get an idea of how some of the best Forex trading platforms work and get familiar with their features. Remember, there isn’t any shortcut to learning Forex. It takes time, effort, and a lot of passion.
Step 3: Recognition
You must know the safety zones and risk involved in Forex marketing to earn maximum profit, and for that, you need to be self-aware. Consider analyzing your goals and objects, and trading accordingly.
This is a very important step for beginners who want to trade Forex.
Step 4: Investment
A new trader can start with small numbers and only increase their account’s capacity with profit, not via further deposits. You don’t need to invest a fortune to earn a profit.
No matter how small your investment is, you can maximize it. As you start out small, you minimize the risk of great losses, especially when a huge amount of money is involved.
Step 5: Single Currency Pair
The world of currency trading is complex due to the unpredictability of markets, different characters, and the obstinacies of its members. It’s never been so easy to become a perfect trader in the financial world.
Start with a single currency pair, preferably one you’re familiar with. It will be even better if you choose one that uses the currency of your country, or one that is widely traded.
See Related: Best Value Investing Books to Read Now
Step 6: Stay Vigilant
If you find yourself in a pickle and become concerned about the effects on your trading, don’t let your emotions confuse you. Consider maintaining a practical and logical approach to your trading as giving into feelings of excitement, panic, or greed can ruin your trading career.
You need to follow a predetermined trading strategy to become a successful trader.
Step 7: Keep a Record
You learn from your mistakes. Therefore, you need to keep a record of your failures and successes, as well as any positive steps or key mistakes that you’ve made to achieve your desired goal.
Now that you’re all caught up with the basics let’s take a look at the ultimate steps to becoming a professional Forex trader. Understand charts by reviewing your wins and losses including the key indicators. I love using TradingView for charting since it’s so simple.
Read more about TradingView in our review.
Professional Forex Trading – 3 Easy Steps
Step 1: Trading Strategy
You must have a clear vision to become a currency trader, meaning you need to have an idea of possible market moves and your pertinent actions. There are a number of trading strategies available. You may want to become a swing trader, a scalper, or a positional trader. The important thing is to have a strategy you feel comfortable using.
You need to understand what you’re doing and why you’re doing it. As mentioned earlier, having a demo account helps as it allows you to test your strategy with no risk. No matter how much time it takes, don’t be discouraged by it. Just keep at it, and you’ll find success. Use can use a demo account with a place like SureTrader. Check out our SureTrader review for more information.
There are many different currency options and pairings to trade on in Forex markets. This includes major pairs: EUR/USD, USD/JPY, and GBP USD, minor pairs: ND/CAD, CAD/CHF, and exotic pairs: GBP/PLN, EURRUB, and EURSEK to name a few.
Step 2: Never Overtrade on Your Demo Account
Generally, a professional forex trader is someone who trades for a living, and the only way to cover your expenses is through trading on a live account.
This is why suggest switching to a live account trading once you’re ready. The process shouldn’t take more than a month.
However, it’s not recommended to postpone live trading for more than 3 months once you’ve started trading on a demo account. Use your demo account as your platform to learn how to trade forex for a living.
Step 3: Become a Successful Trader
Once you’ve established your tactics and switched to a live trading account, you need to move on to the following steps:
- Set stop-losses for each trade or else failure is almost certain.
- Create a trading plan and always stick to it.
- Avoid risking more than 2% of your margin per trade.
- Don’t mix your emotions with trading.
- Trading to compensate for your losses is a no go.
- Never be too scared of losses; it happens from time to time.
- Set your aim to have less unsuccessful trades and store more profitable trades.
Every time you take a profit to learn to reinvest it and compound your returns.
Conclusion on How to Trade Forex for a Living
This is the right path to follow if you want to become a good forex trader. Of course, there will be losses and stress along the way, but that doesn’t mean you have to give up. With a bit of effort and passion, you can make up for literally any bad experience you may have.
Forex traders have the ability to work from any place with a good internet connection. They’re blessed with strong growth potential, and the lifestyle they lead certainly comes with a lot of enjoyment.
If you’ve ever taken this path, you understand this gift doesn’t come so easily. The sooner you start, the faster you’ll reach your destination.
So, why not begin your forex trading now? Do you know how to trade forex for a living? Let us know in the comments below. I’d love to hear from you.
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