First, let me state for the record that I do not trade Forex full-time.  The fact is that I have just started getting back into it after a couple of months of hibernation.  It was initially my goal to trade full-time within 1 year of discovering Forex but this just hasn't happened due to many factors.  I'll talk about my evolution since then, the mistakes I've made and learned from, and where I intend to go from here.  

I’ve been looking back over 2 years ago to when I first found out about Forex and it got me to thinking of my evolutionary history.   I’m sure what I did first is similar to what many others have done, read, read, read.  The first book I bought was a decision made up for me considering it was the only Forex related book in the investing shelf at my local book store.  That book was “Forex Made Easy” by James Dicks.  I immediately saw through the fluff and came to the conclusion that Dicks was nothing more than a marketer.  Nevertheless, the information in the book at least gave me some basic knowledge, like what a currency pair and what a pip was.  From what I recall, the next book that I read was Luca’s, “Trading In The Global Currency Markets” which gave me more information like who the main players were, what makes currencies move, technical analysis, and fundamental analysis.  If I could choose now what books I would have chosen to read if I knew then what I knew now, they would probably be “Trading in the Zone” by Mark Douglas and “Trade Your Way To Financial Freedom” by Van K. Tharp.  The main reasons for these choices are because both books deal with psychology and how greatly this comes into play during, before, and after each and every trade.  Tharp’s book also talks more about expectancy and position sizing than any book or online resource I’ve ever encountered.

After reading these first two books in addition to many online references, I decided to apply for a demo account at FXCM.  I’ll be the first to admit that I had no idea what I was doing.  What the demo really did for me was get me familiarized with order entry and exit.  It also gave me an idea of how much I could expect to lose on a particular trade.  During these first few weeks of demo trading, I just randomly placed orders without a care in the world.  I’d do things just for the hell of it without thinking of the consequences.  Why should I have? This wasn’t real money.  It was a game like monopoly.  There was no way that I could take this seriously.  This was not going to motivate me to learn and I knew it.  After a few weeks, I jumped right in and opened a mini-trading account trading 10K lots at FXCM with about $1000 USD.  What happened from here can easily be guessed based upon others experiences.  I’ll continue the story further in part 2.

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No. 1 : Commodity Tradding

It is paramount that all traders have applicable money management systems and stop losses in place to protect against potential pitfalls when trading, but by using CFDs with a profitable trading system and leverage, the sky really is the limit.
Regards.
ForexCTAs

Submitted by ForexCTAs • 2007-11-01 04:02:51

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