My New Forex E-book

I didn’t really write an e-book but most of the e-books I’ve seen out there should be combined into a big pile and burned.  If I were to write a forex e-book, it would probably be less than a page long.   Here is my e-book replacement.

If you’re a beginning trader, then go out an invest in a currency related book on technical and fundamental analysis.  There are tons out there that cover both and they’re a lot cheaper and easier to read than an e-book.  If the book doesn’t go in depth enough on a particular subject you’re interested in, do a Google search and you’ll find all the information you will ever need.

After getting some book smarts on the subject of forex trading, jump right in and start trading.  Trade a demo or put a small amount of money that you can afford to lose at a broker that offers variable sized lots.  Being able to trade in variable sized lots or micro-lots is critical.  If you don’t have the ability to do this, most likely you’ll be overleveraging which will most likely lead to ruin.  Try different strategies, either ones you’ve picked up on forex forums or ones you’ve created on your own. Experimentation is key and success will only come with experience.  Consistent profitability isn’t going to happen overnight.  The goal is to stay in the game for as long as you can without getting discouraged.  I hate to sound like a walking cliche but there will be many bumps in the road.  You’ll have to prepare yourself to take the punches and keep getting up.  Take a break when you feel overwhelmed by the market with the intention of jumping back in when you feel like you’re ready.  

My brother is a pilot for a major US airline so I know how many hours he had to have flying an airplane before he was considered proficient enough to fly a large passenger jet.  Why would trading be any different? Get those trading hours.  Even then, there is no guarantee that you will be successful but you’ll never know if you don’t get the experience.

If you trade long enough, you’ll start to see consistencies in the forex market.  Your style of trading will also appear even if you weren’t trying to find it.  You’ll also start creating trading systems that match your trading style.

With this experience and increased ability, I’d like to think the rest is this simple.

  1. Size your position.  Keep your risk low on each and every trade.  I like the risk per trade to be less than 2% of my total account balance.  Use my position size calculator at if you don’t know how to calculate it.
  2. Execute your trading system(s) knowing their criteria for trade entry and exit.
  3. Tune and tweak your trading system if needed.  Continue to search for additional trading systems that you feel may give you an edge in the market.
  4. Repeat step #1.

Maybe I have a case of trader muscles but I don’t think it should be much more complicated than this.  There may be a time when you decide to look into carry trading or more exotic trading strategies which complicate things a bit more but even then, I feel the basic principles still apply.


14 Responses to “My New Forex E-book”

  1. Stormin_Norman on February 28th, 2008 5:39 am

    I think your 3 rules are good.

    Especially the first one. Risking more then 2% in a trade is almost guaranteed to send you to ruin eventually.

  2. Caprica on February 28th, 2008 6:12 am

    Gosh, this forex e-book must be no good. It doesn’t even promise to reveal amazing trading secrets that will allow you to earn a million dollars a day for the mere price of $99.95.

  3. Carl Williams on February 28th, 2008 9:15 am

    This is profoundly simple. Although I think one can get by with 3% risk.

  4. David on February 28th, 2008 9:59 am

    As regarding risk, You want enough to make it worthwhile but not enough to affect your trading judgement. If your pulse starts rising once the trade ticks against you it is probably too much.

  5. James Woolley on March 1st, 2008 11:53 am

    Some sound advice. The only thing I would add is to forget about scalping 1 and 5-minute charts as longer term charts conform much better to technical analysis, and it’s a lot less stressful.

  6. Rich on March 1st, 2008 5:18 pm

    Good point James. I never mention anything about trading timeframes. I don’t trade anything but hourly and longer.

  7. Forex ebook on November 13th, 2008 11:43 am

    Vielen Dank für das geniale ebook. Werde Ihre Vorschläge versuchen zu beherzigen. Auch ich habe micht mit dem Thema des Devisnhandel bzw Forexmarkets auseinandergestzt und versucht eine kleine Infoseite dazu ins Leben zu rufen. Evtl. besuchen Sie dies mal. Ein ebook biete ich in Zusammenarbeit mit eToro auch dort an,

  8. Diggy on January 30th, 2009 2:42 am

    I Agree 100%!
    Trading is that simple, a combination of good technical anaylisis combined with proper money management and over time you will get experience and build your account.

    Easier said than done though and most people struggle with it.

  9. jim on February 2nd, 2009 1:22 am
  10. Xenon on February 15th, 2009 6:54 am

    Yup 3 rules are good!

  11. FOREX Guide Reviews on February 16th, 2009 1:57 am

    very good… good idea for you

  12. Free Forex eBooks on February 21st, 2009 12:35 pm

    I love the comparison to being a pilot, too many people expect to become a good trader overnight but it just doesn’t work like that!

    Good article and some solid tips – thanks for your work

  13. Forex Killer Review on March 9th, 2009 12:00 pm

    One thing about reading too many books about forex is that you get confused with information overload…. if you read less, you don’t get much info to start with… grrr… sigh…

    Thanks for the article, you are right on it…

  14. The Broker on December 8th, 2010 11:17 am

    I liked three rules, especially second and third one. Deffinately more than 2%
    in a trade is risky.

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