You can gain from my blog by reading about my pursuits as a trader, knowledge (if the market interests you), help you with your trading activities through the resources I aim to provide, and hopefully some entertainment as I delve deeper into my own understanding of the global financial markets.
I have been trading the currency market for a few months, after I was laid off from my exciting and lucrative job as a senior level technical support representative. Before I started trading live money, I spent several months trading on a demo account to get an idea of what I was getting into. If you are interested in forex and think that you may have the potential to be a successful trader, my advice is to find a reputable broker and see if they offer a demo account for practice purposes. The idea behind a demo account is to provide you (the client), with a means to learn about currency trading, and the trading platform of your broker without the exposure to any financial risk while you learn. Think of a demo account as a 'sandbox' which provides the opportunity to learn while you play. Some advice that I followed and kept in my mind was to spent several months with my demo account and to pretend that I was trading real money; an illusion, but a valuable one in my humble opinion. Another strong piece of advice regarding the demo account is to trade with it for a few months and aim for consistency of profits prior to even thinking about putting your real money on the table.
With most forex brokers, they will usually offer a demo account worth $50,000 dollars in play money. This type of account mirrors the standard forex real money account wich usually has a minium of $2500-$5000 as a minimum deposit. This type of account has a standard contract size of $100000 and a leverage of 100:1; in plain english you can control $100 with $1. Although I did start this way, and it was interesting to watch the value of my demo account fluctuate by 1000s on a daily basis, I came to the realization that it was an unrealistic starting point for my trading activities. Although I could (and can) open a standard account right now, I know that I am not quite ready. When I spoke with a representative over the phone (you may get a call if you start demo trading), I came to the realization that I had more loosing trades than winning trades and my demo equity was falling at a steady rate. I did start my real account, but with the personal understanding that I would only invest a small amount to start. I opened a mini account (value under $2500) and would not trade live until I had gotten my demo account into profitability. Did that, and then started live trading. There was a difference between demo trading and live trading, and it is purely psychological. I did lose money, and then some more money, and then some more money. I was in a bad spot, but then I realized that I had preserved most of my capital by not starting a regular account and then resigned myself to demo trading for a while longer and to keep honing my strategy, my rules, and my discipline.
I started reading, watching videos, and learning as much as I could. Although I did make the transition to live money trading, I am still in the learning process.
Tip: RIM has crossed above it's 50 day moving average for the first time since September of 2008. Although it's at the top of the Bollinger Band (I've already taken long entry weeks ago), this may see the first step to a larger move up. Currently it is at 63.000 at 2:16 pm, and I'm curious to see if either there will be a sell off as the longs take their profits or if it will continue up. I guess I'll have to wait until the market closes to find out, but I'm staying in because this is a long term position for me.
Disclaimer: Please understand that the information provided in this post and all future posts is not a solicitation to buy or sell currencies, futures, or stocks. Currency trading can provide the opportunity for large rewards and large losses. This blog offers no guarantee with the information contained therein, and will not be held responsible for any losses incurred by the participating readers.
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