A question I have been asked a couple of times since we started writing about day trading and the such. Is can forex trading be a full time job? As in can you make a reliable salary from trading the foreign exchange markets. The short answer is yes. Of course you can. There are professional sports gamblers in the world and sport is a lot more volatile than the forex markets despite what you might believe! A better question should instead be: “Can I” personally I don’t know you so I can’t comment, but if you have only just started researching forex then the current answer is NO!
The forex markets are incredibly difficult to read, as an individual trader our job is to see patterns and work through a strategy to try and get our 20-50 pips profit per day. Some days we will lose, but if we can hit 60% winning trades, with proper stop losses then there is no reason why you can’t make good money through the forex markets.
The first skill you need is patience. Rushing into trades, making too many trades or simply getting bored and making larger than 1% of your total balance trades is a quick way to losing all your money. Which 90% of traders do! You can check out this article which talks about what it feels like to be a forex trader.
The second skill you need is a stone cold profitable strategy. There are literally hundreds of forex trading strategies. Choosing one that will suit your style of trading is very important. This depends on how much you can dedicate to your trading. If you don’t have a lot of money / leverage, chances are you will need to input more time as a result, to ensure you don’t have many losing trades. Losing trades will happen, but reducing them can be easier than you think.
The third skill is you must know the basics inside out. What the market means if it goes this way, what happens if you see a certain element and everything in regards to setting up an account, making your first trade, how to set stop losses and all of what I call the “additional elements” that aren’t going to make you any money, but are going to save you a ton of money in the long run! Our ebook covers this in detail, so if you haven’t done so already, pick it up [right sidebar.]
The fourth element you need is a reliable forex broker. We’ve done extensive research into this area and still recommended etoro for beginners. It’s very simple to set-up and you can get started with only a couple of hundred pounds/euros.
The final element I would recommend is common sense!! So often I see people losing a lot of money, sometimes 6 figures, by following systems or strategies outlining how they can “double their money 100 days” – When it comes to these type of offers, just ask yourself 1 question…. If this really was that successful – 1.) Why would this individual need to promote the product, even if they only started with £5,000, in 3 years that is now close to a million pounds… 2.) Why would they want to increase competition for this “amazing new strategy.” So although I say you need common sense, maybe a better phrase would be you need to avoid the BS associated with the industry.
Yes, follow the traders that show live profits, follow through social trading platforms the same people. But don’t rely on these individuals. Everyone has bad streaks, even the best forex traders in the world!
Think of trading, not just as a way to make money, but as a business. If you treat it this way you will generally be a lot more successful than the individuals who look at it simply as a get rich quickly attempt (which often fails) or a way to try and make some additional money (aka not putting enough work in research up-front.) Treat your investing career as a business and you will be thrilled with the results you can potentially achieve.