I don’t think that telling you directly at which point to enter the market and which point to stop loss is a good word in the foreign exchange circle.
What I really feel most is to trigger my own thinking and share some inspirations about my investment behavior.
Today, Huihui Class will share with you the thoughts on the road of foreign exchange investment, hoping to inspire your trading.
Incoming as a scholar
It is said that in the first few years of trading, a trader should regard himself as an apprentice. In the process of learning while doing, don’t expect significant profits, take only a small amount of capital risk, preserve capital, and give yourself enough trading experience.
During the study period, I pay attention to the lightness of paper. No matter how many books I read, how much trading experience I read, and even simulated trading, it is not worth the actual foreign exchange market trading.
Simulated trading can only make you more familiar with the execution details of your own trading operations and test your own ideas. But you can’t imitate the trading psychology in actual combat, and you have a different mood in the face of loss and profit. For example, a loss of 1 million in the simulated market may have no effect on your life, but a loss of 1 million in the real market will make your mood fall to the bottom, which directly affects the caution of the next transaction.
The state of learning while doing may last for 3-5 years, and if you want to learn better things, it will inevitably be accompanied by learning costs. Some Hui friends reported that they spent about $50,000 in tuition fees before they were promoted from novice to veteran. The tuition fee here includes not only the study fee, but also the experience fee to the market.
Be prepared for a loss at the beginning
I may have repeatedly mentioned that in the first 1-3 years of trading, 80% of investors lost money. So if you are not ready to accept the loss and the funds, I am afraid that you will not survive until you can make money.
Some Hui friends broke the news that they should prepare a starting capital of USD 25-50,000 in the first three years of trading. This may poke you again. Most of them think that the cost of foreign exchange investment is low, and it is enough to prepare a few thousand dollars. If this is the case, in fact, it is really better to invest the money in the fund or deposit it in the bank. Because of this foreign exchange, the ending will not be too good.
The essence of foreign exchange trading is that you can afford to lose. If you have a mentality that you can’t afford to lose at the beginning, then don’t enter.
Therefore, foreign exchange investment still requires a certain cost. In addition to basic living expenses, you must have enough investment funds. There are also some Hui friends around who borrow money to invest. This will make him trade wildly with a must-win mentality, with heavy psychological pressure, and the final investment result will be much worse than before.
Knowing this, your initial goal in trading should also be to preserve capital, not to make money. When you shift your focus from making money to not losing money, it is easier to make money.
The trading system is simple
Many Huiyou believe that the more complex the trading system, the higher the accuracy and the greater the profitability. But it can’t.
Because market trends are inherently uncertain, no matter what trading system is used, they are predicting future trends. Predicting with 10 conditions and predicting with 2 conditions are both a probability. This is not a question of “many people are powerful”, but each condition is independent and uncertain. Just combining these conditions will make your trading system unfavorable for execution.
The core of the trading system is to regulate one’s own transactions and do a good job of risk control. So the point is to be easy to implement, and to persist in implementation and continuous polishing.
Therefore, as long as the core things such as fund management, technical analysis, and trading rules are done, the trading system is simple.
The above is today’s sharing. There are still many good habits and correct understandings on the road to profit in foreign exchange trading. The above is only a small part, but I think this is also the most relevant to everyone.