Basic FOREX day trading

[Braden]

Hey guys !

I'm 21 years old, and have recently discovered asx shares trading and forex. ASX trading is a bit too slow and safe for my liking and would love to have a crack at forex. As a beginner, whats a safe amount of money to put into forex trading that also has the potential to produce an alright profit % over time. I work night shifts so I'm able to trade at anytime during the day specifically if the market has set volatile times to work towards that extra bit of win.

 

[Trembling Hand]

The safe amount is 0 (zero) to begin with. Open an account with any of the fx brokers that offer a sim account and practice and play around for a while to get a feel for how the world works.

 

[minwa]

Demo account is a good start. There is no "alright" profit - if you manage above 0% you are way ahead of the pack and exceptional already . In a live account that is. Also you might want to rethink your question - how can we not knowing your financial circumstances suggest a safe amount for you.

Is your shifts evening or midnight shifts ? If you're looking for volatility it's usually in London and New York sessions, if you're on East Coast time zone you will miss most of it if you're on evening ****s. If your shifts are midnight that's alright you get London & early New York sessions.

USD denominated pairs dies down around 18GMT onwards, around 4AM East Coast time, few hours after that you should avoid if you looking for action unless you can scalp in low volatility.

 

[barney]

Hey guys !

I'm 21 years old

ASX trading is a bit too slow and safe for my liking

would love to have a crack at forex.

As a beginner

if the market has set volatile times to work towards

As someone who has been trying to find an edge in FX trading for a long long time, your 1st post is pretty scary if you are seriously thinking you can hone in to a productive trading strategy with nil experience

The safe amount is 0 (zero)

What he said!!

Demo account is a good start - if you manage above 0% you are way ahead of the pack .

What he said as well !!!


Braden,

If you treat trading Forex like a Casino you might get lucky for a while but you will eventually lose your shirt. I'm lucky I've only lost my shirt 3 times!! ....... You may turn out to be a gun trader, but if you trade like a gambler you WILL lose ......

Get yourself a Demo account ... trade like its real money .... and set realistic profit goals. If you can double your trading account twice in a row without being a Maverick you might be ready to risk real cash! Good luck!

 

[Braden]

So been having a crack at the demo account and have had some luck, bought in EUR/USD at a short, looked like it was going to drop. Ended up having a decent win off that.
What ratio should I be running for pips? I've got it set at 50:1 atm.

 

[mit]

One of the things with FOREX is that some platforms let you play with very small amounts of money. Start with $100. Even though it is $100 still treat it with the proper risk parameters (2% risk and whatnot) and see how you go. You might blow the $100 a few times but that is a cheap education.
The problem with a Demo account is that if you are profitable about a month you'll be tempted to throw $10k at the account and go through a brain freeze when you are down a few thousand or alternatively you make a few thousand and think you are invincible and ignore all of your risk. We are our own worst enemy.

After you start to consistently make money I would slowly add capital to the account or better still grow the $100 into something meaningful and you will get used to the ups and down of the market using more and more money.

 

[Braden]

Yeah I understand that you are your own worst enemy, have delt with that at casinos haha.
I reckon i'm gonna go on a live account now and just start with say $200 and do as you said, 2% risk management and go from there. What pip ratio should I run?

 

[sinner]

Yeah I understand that you are your own worst enemy, have delt with that at casinos haha.
I reckon i'm gonna go on a live account now and just start with say $200 and do as you said, 2% risk management and go from there. What pip ratio should I run?

I disagree that you should start with a live account.

Most businesses fail because they are undercapitalised.

One of the key things to learn about when trading is money management and to be able to take effective positions and only risk 0.5-2% of your account per trade, you will need an appropriately large balance, i.e. you will need to be appropriately capitalised.

My personal opinion would be, don't start trading live until you are both appropriately capitalised and actually familiar with how to take effective position sizes with appropriate risk management.

People who are telling you imperatively what to do "start with $100" are forgetting that on ASF we cannot give financial advice, I would not listen to those people.

You're new and have already been provided the highest quality opinions by some of the best traders on ASF. Don't disregard those opinions just because somebody told you what you want to hear.



Your leverage ratio should be informed on a per trade basis according to your risk management and position sizing. Learn how to do this before anything else.

 

[mit]

Yeah I understand that you are your own worst enemy, have delt with that at casinos haha.
I reckon i'm gonna go on a live account now and just start with say $200 and do as you said, 2% risk management and go from there. What pip ratio should I run?

I'm not sure what you mean. I do Aussie and every $100 works out to be around 1.4 cents per pip at the moment. If you are trading traditionally and if you are running $200 and you have a 2% risk then you want to stop at a loss of $4.

If your stop is say 25pips that works out to be a position of $1140.

 

[Braden]

I'm not sure what you mean. I do Aussie and every $100 works out to be around 1.4 cents per pip at the moment. If you are trading traditionally and if you are running $200 and you have a 2% risk then you want to stop at a loss of $4.

If your stop is say 25pips that works out to be a position of $1140.

Sorry I meant leverage. So atm I'm running it at 50:1

 

[jakesgarland]

The world's currency rates are not fixed. They follow a floating exchange rate and are always traded in pairs Eurodollar, Dollar/Yen, etc. All traders use some sort of software normally in chart formation to know in which way a particular currency pairing is moving. It is the charts, which can be manipulated to a particular trader's style to maximize successful Forex day trading.

 

[Valued]

The world's currency rates are not fixed. They follow a floating exchange rate and are always traded in pairs Eurodollar, Dollar/Yen, etc. All traders use some sort of software normally in chart formation to know in which way a particular currency pairing is moving. It is the charts, which can be manipulated to a particular trader's style to maximize successful Forex day trading.

Some currencies are fixed to other currencies though because the central bank will buy or sell huge amounts, often at great cost, to keep it fixed. China does this with its currency by fixing it to the US dollar. It's not a fix in that it is supposed to equal the USD, it's deliberately kept within a range below the USD and it is allowed to move within a certain percentage range.

 

[DeepState]

The world's currency rates are not fixed.

Please see page 6.

https://www.imf.org/external/pubs/nft/2014/areaers/ar2014.pdf

 

[bely1995]

Good luck