This article ”forex trading plan for a beginner” is focused on educating the readers on the elementary knowledge of setting up a forex trading plan and executing your plans for daily profiting. We must have learned so far that without setting goals aims are not achieved and without carefully following the set goals to detail, aims cannot also be achieved. Relax, pick a book and pen while carefully strategizing plans on how to trade and benefit maximally from the forex market or financial market.
People may ask what kind of forex trading plan is best for beginners. Another may ask what are the 7 steps to creating a trading plan? Or a simpler question, asking; How do I create a forex plan? To answer all these questions could be simpler than many imaginations or schools of taught because there is ‘’no one size fits all’’ answer in forex trading. There are a thousand and one forex trading templates on the internet but all those never guarantee daily profiting. One has to be very detailed and disciplined to be a professional trader. The 10 Step-by-Step Forex Trading Plan for a Beginner are being highlighted below for your additional research and knowledge acquisition.
- Having a plan and being prepared is the most relevant aspect of a trading plan for a beginner.
- Does your plan include becoming a day trader or a scalper?
- How much time are you willing to dedicate to trading each day?
- Having the right mentors behind you to hold you accountable will accelerate your progress.
- Do you have the right coach or tutor to pass to you the right knowledge?
- Is your mentor a proven profitable forex trader?
- Being teachable is the goal to consistently increase.
- Are you willing to sacrifice time and resources to learn forex trading?
- Are you ready to discard all you have learned in time past for a new strategy that works?
- Having the right attitude.
- Can you start small and win big?
- can you take calculated risks and not fidget?
- Stick to your plan.
- How well are you ready to stick to your forex trading plan?
- Does your forex trading plan work with your patience?
- Start small.
- Are you patient enough to make a small amount of money in bits and grow bigger with a slow and steady forex trading plan?
- Never blame others.
- You must be willing to take responsibility for your actions and inactions.
- Never have the fear of trading with real money.
- Do you have fear of trading real money?
- Are you ready to lose real money over time?
- Follow market trends and never go against the market trend.
- The trend is your friend in planning a good forex trading plan.
- You must be able to determine what trend the market is trading at all times.
- Be patient because there will always be time to trade when you have good equity in your trading account.
- You must be a very patient trader to see clearly in forex trading.
- Make your forex trading goal achievable.
4 Forex Trading Strategies
As a beginner, you need to develop skills in fundamental and technical analysis, risk management, and trading psychology. You should also be familiar with the different types of forex trading strategies, such as scalping, day trading, swing trading, and position trading. Finally, you should have a good understanding of the different economic indicators that can affect currency prices.
These strategies are secondary to the 10 step-by-step forex trading plan for a beginner
- Swing Trading
- Scalp Trading
- Day Trading
- Position Trading
Swing Trading
It is observed that people who do not have most hours of the day to trade profit more being swing traders. Swing traders follow trends so if the trend is downward, they will look to SELL. And if the trend is in upward momentum, swing traders look to BUY.
Swing Trading Personality Traits
- Swing traders have the ability to wait patiently for the right opportunity to place trade orders.
- Swing traders are sharp and flexible thinkers.
- Swing traders are low on time management.
- Swing traders do not have the ability to follow forex trading charts consistently.
- The stress level of swing trading is minimal compared to others.
Don’ts of a Swing Trader
- Impatience
- Inability to be organized
- Lack of precision and not understanding trends of in the market
Scalp Trading
Scalpers are traders in the forex market looking to enter and exit a trade order at the quickest opportunity available due to price momentum. Scalpers do not have a strict exit strategy, they involve in too many risky trades. Profits made are usually small and a wrong trade could mar trades for the day.
Scalp Trading Personality Traits
- Precise and concise decision-makers
- They have trust in their decision-making and act accordingly
- They spend time on the markets more
- They can handle losses and possible stress
Don’ts of a Scalp Trader
- Scalpers must never lose focus easily
- Inability to make apt and sharp decisions
- Inability to be calm and focused on trades at all times
Day Trading
Day traders have in-depth knowledge of the forex market, they have high forex education and training to handle both losses and profits on daily trades. Their trading strategies change per trade and daily. They depend mostly on forex news and capitalize on the news for their profit.
Day Trading Personality Traits
- In-depth knowledge of the market
- Huge trading capital
- Ability to recognize opportunities and act immediately
Don’ts of Day Traders
- Inability to follow market news
- Inability to handle huge gains and losses
- Inability to exit losses quickly
Position Trading
These are traders with long-term vision and forex market execution plans. Position traders leave trades open for days and sometimes weeks. They have a long-time target and they wait patiently and wisely. They believe once a trend begins it continues for a period of time and they make use of that opportunity wisely.
Position Trading Personality Traits
- Long-term thinkers that are also time conscious
- They don’t grieve over permanent losses
- They prefer delayed gratifications and volatility
- They have a large well-diversified knowledge of the market
Don’ts of Position Traders
- Inability to handle permanent losses
- Expecting instant rewards
- Preference for a particular trend
- Lacking patience and discipline
7 Major Terms in Forex Platforms For Beginners
Forex Platforms are also secondary to the 10 step-by-step forex trading plans for a beginner
- Stop Loss – a market order that allows traders to close a losing position automatically once it reaches the position set as stop loss.
- Take Profit – a market order that allows traders to close a winning position automatically at the position set as take profit.
- Fundamental Analysis – a way to determine which currency pair will go up based on the economical and political situations of the economy or country.
- Technical Analysis – analyzing past performances of the pairs using charts and forex indicators to predict future price movements.
- Majors – These are the most traded currency pairs in the world. They are always denominated in USD.
- Minors – currency pairs that are not traded often as the majors. They are also referred to as exotics.
- Crosses – any currency pair without the USD pairing. Such as EURAUD, AUDCAD etcetera
Forex Trading Plan Checklist for 10 Step-by-Step Forex Trading for Beginners
- Learn how to read charts like a Pro
- Never deviate from your trading strategies or forex trading plans
- Learn to win big, and lose small
Online Brokers
You would have to do research work on which particular forex broker accepts clients from your country. You will need to choose about 3 to 4 so you can select the best of them all with respect to leverage, spread, and pairs trading. You will definitely need a regulated broker and it is usually advised to open a demo account and have a trading experience with this new broker of your choice. Once you can double your demo account using your profound trading strategies, you’re ready to start trading the forex market.
5 Easy Steps to Trade Forex as a Beginner
These easy steps are secondary to the 10 step-by-step forex trading plans for a beginner.
- Internet Connectivity – you can use a mobile phone, tablet, or a compatible computer of your choice
- Get an online Broker – any broker of your choice
- Open a real or demo account
- Download either the MT4 or MT5 app that is compatible with your Broker’s guide
- You can begin trading your demo or funded account
Create a Demo Account
Start with a demo account: Before you start trading with real money, it is important to practice and gain experience with a demo account. This will help you understand the basics of forex trading and develop your own trading strategies.
Conclusion
At the end of deliberate reading and understanding of this article, you’re expected to take action and follow up with our website as we progress in leading you with this basic 10-step-by-step forex trading plan for a beginner. We know fully well that you’re just getting started and we are here to help you with our daily forex signals. You only have to trade it immediately after it is published here on our webpage. How do I start forex trading as a beginner? This and many questions others have this article talked about and did a justification about for every beginner in the forex market.
