It seems easy to start learning how to be a Forex trader because there are so many online resources, the problem is that only a few of them have valid information and trying to separate what is useful and what’s not has become a skill on its own!
Before indicating how to study, I think it’s better to define what you need to study to become a trader (a beginner one):
- What Forex trading is and how it works. It is crucial, otherwise you can learn to manage the best indicators but you will never make money if you don’t understand how prices move in the Forex market.
- Basic terminology. This can be very annoying because traders and analysts like complicated terms. So instead of “I’m buying GBP/USD”, you will hear “I’m long on the cable”.
- How you can open a position, calculate the risks, the potential profit and how to manage your position.
- How to choose a reliable broker. Find a Forex broker is not complicated. If you search on google for a list of brokers, I can guarantee you that you will find thousands of different companies. But you don’t want just a broker, you want a top broker that can guarantee you that your money will be safe. Do you remember Scrooge Mcduck? He was very good at making money, but he was even better at protecting his money from the scammers!
- How to manage your money and your risk. In my opinion money management is the most important skill for a Forex trader.
- Create a strategy that works for you and test it with a demo account.
Now that you have an idea of the path that you need to follow to become a trader, it’s time to focus on how to study.
“Direction is much more important than speed. Many are going nowhere fast.”
I suggest you three different ways you can follow to start learning Forex, you can also combine them.
This is the traditional way. Several books are available on the subject of currency trading, ranging from basic education on the Forex market to advanced trading strategies. Choosing a book is not that difficult, you can look for reviews on Forums or websites like Amazon, so it’s not like looking for information online, with a book you will already have an idea whether the content is valid or not.
I can personally recommend:
- How to Make a Living Trading Foreign Exchange by Courtney Smith
This book gives you an idea of what Forex trading is and how it works. I find it good to start because it also covers basic strategies (DeMark trend lines, breakouts etc.) and the psychology of a Forex trader.
- Currency Trading For Dummies by Kathleen Brooks and Brian Dolan
This kind of books are always very easy to understand. Perfect to start but it can be a bit boring because the authors tend to repeat the same concepts for 1/4 of the book.
- Day Trading and Swing Trading the Currency Market by Kathy Lien
I wouldn’t recommend this book if there wasn’t a great section in it, that explains what factors drive currency values up and down and why.
Do you know that if you type on google “Forex education”, it gives you more than 10 million results? How can you separate reliable information from the others? You simply can’t, the best thing you can do, when you look for information online, is to be careful and try to get a second (or even third) opinion about what you are reading.
I can personally suggest you 2 websites: babypips and dailyfx. It doesn’t mean that what you find there is gold, follow my advice and always be careful and compare those info with other websites.
I normally don’t recommend online courses for 2 reasons:
- They are usually soooo expensive!
- Most of them require you to be at the computer for a long time, taking notes, otherwise you will forget everything.
But… there are some courses that are neither expensive nor require you to spend hours and hours at the computer.
I also have an online video course and I explain you why I think that is the best way to follow to learn more about Forex trading.
As I mentioned before, many people are unable to spend whole days to take a course about Forex trading, due to family or work commitments. I use Udemy to launch my courses and I can honestly say that it’s the best platform I have ever seen in my life. With these courses, you can learn at your own pace, you will get lifetime access so you can personalize your learning experience according to your commitments.
You can learn anywhere! You can watch the course on your laptop, or download the app and follow with your mobile phone. It is also possible to download the videos and learn offline, making long flights and commutes productive, no internet connection needed! Furthermore, you can listen to courses in audio-only mode when you’re on the go.
Do you think that I say this because I’m a Udemy instructor? Not at all, actually I’m quite unhappy about being an instructor on Udemy because of the fees I have to pay. I say this because I’m a very happy student on Udemy. I enrolled in 38 courses so far, from learning Chinese to video editing, from web designing to Mediterranean recipes and I could never imagine that learning a new skill is so easy.
Now you must be thinking: “yeah, but I don’t want to spend hundreds of dollars to learn something that I can find in a $40 book”. While it is true that some courses are very expensive, it is not always like this. I have a coupon on my website to take the course for just $10, considering that you also have 30 days to get a refund if you don’t like the course, you don’t really have anything to lose.
I will also leave the coupon here, so if you want, you can enroll for $10, or you can just have a look at some lessons for free: Forex Trading: Your Complete Guide to Get Started Like a Pro
Now you have an idea of what to study and how, but I want to tell you something that I always say to my students. Buying a book, download a guide from the internet or signing up for a course is like signing up for a gym membership. You have all the equipment, all the machines and a personal trainer ready to help you, but if you stay home, eating chips and watching television, you are not going to see any result, right?
So, even if you take my course, am I going to guarantee you overnight success? Absolutely not! Anyone promising that is lying.
This is a real business, people like me go through years of formation at university to do this job, so it can take months or years to produce the income you’re looking for.
Having said that, I wish you all the best for your trading career 🙂
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