One of the questions asked many times is “can I make money on Forex” and “how long does it take to make money in forex trading?”. These questions are normal and seem obvious to novice traders, so we will attempt to answer them in this article.
Can you make money on Forex?
Due to the accessibility to the internet, Forex trade has become very popular during the last decade. It turned out to be an excellent option to try if you want to have additional income in recessions. There is no doubt that the foreign exchange market is one of the world’s most profitable financial markets today.
So, the answer to whether one can really make money on Forex is straightforward – everyone can make a profit on Forex. The sole condition is to have a good strategy, invest enough initial capital, and manage the risk properly. Besides, some prior knowledge about the currency pairs and proper training on a demo account will make your trading journey easier.
What does a forex trader need to make money?
You can’t ask yourself how quickly it will take to become a profitable forex trader without answering the question, “how do you get there?” Also, you need to understand how the Forex market works, or else you won’t be making any money in it. You need to learn forex trading and possibly replicate a trading strategy that works or build one up from experience.
Determining how much time is needed to be profitable depends on several aspects, technical and psychological in particular. Forex trading is a lonely business. If you do not increase your skills and mindset, it will be difficult for you to achieve profitability.
In other words, you can very well copy a strategy that works but stay disciplined, stick to a trading plan and money management. First, apply the strategy on a demo account before switching to a real account with your money. Once you have practiced enough and are generating steady profits, focus on real trading. You will be able to practice on a demo on any reliable forex broker platform. To opt for the broker that suits you best, read broker reviews that offer all necessary information about the forex broker.
The importance of a discipline
A characteristic common to all beginner forex traders who make money on the stock market would most likely be disciplined.
While anyone can learn to trade, analyze the markets, and identify trading opportunities, only novice traders who embrace forex rigor and discipline succeed in the long term.
Discipline in trading means having a trading plan that you stick to the letter. And you stick to it even when emotions and stress are very high.
You must have a trading plan
Trading plans vary widely in their content, but generally, the more thorough, the better.
Knowing in advance the exact market conditions for entering and exiting orders, the trading signal, position size, stop-loss, and take-profit are some of the key points of the trading plan a forex beginner must consider.
Investing based on a simple market intuition is very dangerous for a novice trader. Having a trading plan can prevent losing money before you even experience the best part of your trading journey.
Featured Image by Gerd Altmann from Pixabay
