By Admiral Markets
Our age is the age of information.
But having too much information can be counterproductive.
With the expansion of the internet, finding what you need becomes easier by the minute.
Texts, SMS, tweets, emails, the endless stream of Facebook posts and those viral videos we can’t help but click on - it’s all here, right at our fingertips.
The same goes for Forex.
There are many influential websites out there for us to search through.
This does have its drawbacks, though.
Our brain often can’t handle this much information - which results in us being stuck in the paralysis by analysis.
The consequences of information overload are frightening:
- inability to make an entry
- difficulty in understanding price action flow
- illogical trading decisions
- mismanagement of trading entries, stop loss and target price
- distraction due to overabundance of data
- loss of self-confidence
The people most affected by information overload are Forex newcomers.
Too much information eventually makes them totally ignorant of proper Forex trading and managed speculation.
How can you mitigate this overload disaster?
Read below to find out.
For starters, focus on a demo account.
With demo account, you have virtual money to train with, before you put any of your real fund on the line.
Practise a strategy, manage your trade orders, learn how to place stop losses and lock in your gains.
Successful traders swear by their practice regimen.
Practise is the best way to build up your confidence.
Staying focused is key to building a solid knowledge foundation.
With it, your entire training process can produce effective results.
Speaking of effective, take a look at some of the trading experts.
Observe them in action and learn why they are such pros.
Focus on those few who you think might help you - you might learn some new things:
- the Forex basics
- how to select a bank and broker
- how to avoid fraud and scam artists
- how to use leverage and other tools to secure the profit
At some point, you may even want to learn more complex trading techniques.
I recommend subscribing for educational courses on Forex or visiting free webinars.
Search for your own way
Every strategy has its own merits and drawbacks.
At the same time, not all strategies are equally suitable for you as a trader.
For example, take scalping:
…it is a great short-term strategy…
…but requires spending time and attention on the charts.
On the contrary, strategies that focus on holding trades open for a long time may not suitable traders who can’t just “set it and forget it”.
What’s the takeaway?
Don’t adjust yourself to some new trading approach.
Find the approach that is right for you.
The beauty of trading the Forex market is in the freedom it offers.
Find a good mentor
There are so many Forex mentoring programs across various websites.
But which one is right?
After all, it’s easy to learn the mechanical aspects of Forex trading…
…but it’s much more difficult to learn why something doesn’t work.
If you decide to find a proper Forex mentor, do your research.
As I’ve already said, it’s the age of information - google it before you commit.
Follow the trend
Big sharks are the ones shaping up the trend.
And you are the small fish that follows the shark.
When a new trend starts forming, the market is likely to begin making thrusts and pullbacks in the trend direction.
This is a good time to use systems and methods to pinpoint an entry.
In other words, to follow the sharks.
Forget the liars
Have you ever heard promises of getting rich overnight?
That is complete fantasy.
There’s no such thing as guaranteed profit - especially fast profit.
Since we’re doing managed speculation and approach trading professionally, it takes time to make money.
Not to mention, we only trade a small portion of our account - so even the profits we make are not enough to place us in the Forbes list.
Long story short, ignore market players who promise unrealistic returns.
Trading is not a lottery - it’s hard work.
The profits do not fall from the sky - they can only be earned by the sweat of your brow.
Use an award-winning platform
Some time ago, I searched through many different websites for the trading data.
It used to take much time - and honestly, I felt too exhausted when I did find what I was looking for.
Correlation tables, various trading scripts, trade analysers, chart-in-charts, etc. - so much information, yet so unorganised.
With the development of an award-winning MetaTrader platform, I was finally able to have all the important information in one place.
No more scanning through dozens of websites.
My time efficiency skyrocketed.
Food for thought
Staying mentally focused on the market and avoiding information overload takes practice.
Ultimately, it allows you to process information faster and develop the proper reaction time needed to battle volatile markets.
So put down your phone, close the Youtube - and start making a difference.
Cheers and safe trading,
Article by Admiral Markets
Admiral Markets is a leading online provider, offering trading with Forex and CFDs on stocks, indices, precious metals and energy.