Forex 101: Forex Basics – The Requirements

So I finally started doing a post about the basics of forex trading. This post will not tackle the things like how the forex market work as you can head over to babypips.com or post in the comments section for that and we will try to answer you. We will talk about the things you need to get started trading. Things that are important to the success of your trading career and things you need to remember to not go bankrupt.

To keep on trading and learning at the same time and not blowing your account. Your first goal in trading as a newcomer in this business is to last. Not to make profit, but to last. How many months can you go on trading before you hit 0 on your fund. We can mind the profitability later, what you need first and foremost is experience.

1. You Need to Have Money / Capital / Funds / Moolah – In order to make money work for you, you need to have your workers gathered up. Money makes more money if placed in the right spot. You don’t need to have a lot of it, just enough to get you started. $100 – $1000 is probably more than enough.

2. A Trading Account (Real and Demo) – You need a trading account to start trading in forex. There are a lot of brokers around the internet and I suggest you do some research first before giving them your money. There are a lot of scams out there so be careful.

You need a demo account to practice your trading strategy. You need real account to practice your trading strategy with the components of emotions and the feeling of earning and losing money.

3. A Trading Strategy – In any business, you need a strategy and forex is the largest business in the world. Your entry and exit strategy and money management skills will play a big role in your success. Create your own trading strategy and practice it with your demo account for at least 6 months.

You can develop you own trading strategy or customize the strategy of others. You can find a lot of strategy from books and indicators. Do your research well and practice it. Just make sure you follow it when you trade, you already invested a lot of time developing it.

4. Competitiveness – Forex is the battle between the bulls and the bears. The buyers and the sellers. You will win and lose sometimes. The important thing is, do you have what it takes to get back up in case you lose? The players in the forex market are billionaires, banks, retired generals, business tycoons, politicians, managers, retired olympic athletes which are the most competitive people in the world and you’re about to take them head on. You should be well prepared of the lost and keep moving on up to the point till you become successful.

Things You MUST NOT Have

1. Emotions – Its like poker. Emotions cloud your judgement. You need to have a strategy and the discipline to follow it. Do not give in to emotion. Emotion has no place in the market.

2. Ego – You don’t need ego. Admit it when you’re wrong and cut your losses.

If you have questions or suggestions for the next forex 101 series of posts, kindly put them in the comment section below.

  • Bianca Sevilla

    Hi. I’d like to invest into forex trading but i don’t know how and where to start. Is there any seminar about forex trading in the Philippines? And what are the online forex brokers do you suggest that i open my account to? Thank you so much.

  • Pearl

    Hi. Can you advice a good demo trading account to start with? I would like to start investing and going through a demo account before the real thing can help me prepare. Thanks

  • Zendie Gabitanan

    Hello, same here I want to know more about forex.

  • Jay

    You are the first filipino forex trading blog i have ever seen. i have been trading (demo) for the past 2 months, i started out with ikofx, made a lot of pips and lost a lot too. turns out they are not to ideal.

    i have tried seveal including oanda and ikonfx. im going to open a real one soon.

    Nice to see you’re quite active too.

  • Jeff

    Thanks Jay

  • marygrace.angeles

    hi! i’m interesting to join in FX but i don’t know how to start hope you can help me tnx and god bless!

  • yhanner

    hello! I have account in FX,but i really dont know how to play.,hope you can help me…thank you so much.,have a nice day!!

  • Arfe Gavilanes

    I am interested to know how to start and where to start. hope you can help me thanks

  • ferdy

    hi again….. heard from here in this site a some sort of a sortware that u can use to backtest yer trade….. problem is that i forgot where i ve read from yer blogg…. can help me out on this….. coz im plannin to acquire when i get back there sa pinas….

    tnx ferdy

  • ForexPhil
  • Chet

    Hi, I’ve been reading your blog and may I say that it is good to see another young professional who is thinking of actually investing and making his/her money work for them. I do have a very important question though on to which broker would you suggest? There are a lot of brokers out there but I would like to know which broker works well especially with us here in the Philippines. There have been a lot of scammers out there and would like to know, with your experience, on which broker you chose and why. Thank you.

  • ForexPhil

    FXCM is the largest fx retail broker in the world today. I believe you won’t be scammed if you use them. I have an account with them and so are with other brokers.

  • Roseller Salado

    easternmarkets.com

  • ginger

    Emotion is also my problem plus impulse trading but i’m not discourage. These things are part of learning and experience.

  • Ginny Edan

    Don’t lose your investment ignorantly,are you interested in learning how to profit on forex trading? get the best strategy,just write Mrs Malvina on malvina.bancroft@gmail. com