Many new traders looking at learning to trade Forex typically make the mistake of wasting a great deal of time aimlessly sifting through the endless online material available, with a view to conquering the markets by themselves. The increasingly easy access to trading platforms and educational materials tends to encourage the view that aspiring traders can learn to trade forex without any help. Many of these traders will learn the hard way that this is typically not the case and that most traders will learn best and achieve success fastest, by learning from someone who has already achieved success.
While it is indeed possible to learn to trade forex without any assistance, the vast majority of traders find it far easier and far quicker to learn to trade forex under the guidance and tutelage of those who have already achieved success in forex trading.
There are a variety of ways that traders can go about getting this education.
When it comes to learning to trade Forex there are essentially two schools of analysis that can be followed, these are fundamental analysis and technical analysis.
Technical analysis concerns the study of the movement of price on the charts. When studying technical analysis traders are only considering elements which can be applied on the charts such as trendlines, support & resistance, Fibonacci tools, technical indicators and other such elements. The basic premise of technical analysis is to learn to understand how price moves and identify recurring patterns and behaviours that can be exploited for profit.
Fundamental analysis differs from the technical approach in that traders using this form of analysis consider economic and geopolitical drivers which can affected price action. So, instead of learning to understand the way price moves on the charts, traders will study the relationship between price action and the economic environment. The most common form of fundamental analysis relates to tracking economic data releases and using these releases as inputs for trading decisions.
The majority of retail traders focus on technical analysis as it is a far easier and more readily usable way of analysing and trading the markets though in reality a combined approach tends to work best where traders stay aware of the fundamental landscape and use technical analysis to make specific trading decisions.
Signals & Analysis
Not all traders are specifically interested in learning how to trade the markets or would like to engage the markets but simply don’t have the time to make their own analysis and manage their own accounts. For these trades, the best option is most likely to find a reliable Forex signal provider.
Following a consistently profitable signal service a great way for traders to profit from the expertise of professional traders whilst also having the opportunity to develop an understanding of the methods used in generating the signals.
Arguably the most efficient way to learn to trade forex profitably is to use a mentoring service whereby you take part in live sessions with a pro trader who educates you based on the strategy they use and walks you through their approach to the markets. Regular live sessions with a professional trader can significantly expedite the learning process and help traders advance in their capabilities.
When deciding the best route for learning to trade forex, traders need to consider the amount of time they have to dedicate to market study but also in what manner they feel they will learn best. Some traders proceed with learning to trade forex best by following signals and working themselves to understand how these signals work, others learn best from being shown by a tutor.