Whether you are a beginner or a seasoned trader, you probably hear a lot of misconceptions about forex trading. These myths can affect anyone, regardless of their experience.
While there is potentially an endless array of myths, we will discuss a few to help you make informed decisions and be able to separate forex facts from fiction:
The Forex Market Is Completely Rigged
Traders who often end up losing trades might tell you that a dishonest broker who is involved in market rigging was the reason. For starters, you should be aware that the forex market is perhaps one of the largest markets that expands around the world and has over thousands of transactions every day.
It means that it there is a good chance if you go in with an uninformed approach, someone who is better at trading will notice and benefit from it. That is how businesses work around the globe. There is no rigging, just pure strategizing.
Forex Trading Is A Short Term Thing
Long term forex trading is possible and a large number of people are doing it. The growing trend in high leverage trading may have made short term trading popular but it isn’t necessarily the only way to go.
Long term traders focus on the larger picture and are not really concerned with daily market changes. They are also more likely to avoid making impulsive decisions and focus on long term goals.
You Can Be Right All The Time
If you think so, and are working on a strategy that allows you to do so, you are setting yourself up for disappointment. Being a successful trader means developing the ability to deal with losses as well. Accepting these losses and working your way around it to find a winning strategy is what you need.
Predicting The Market Is The Way To Go
Even though that is what most beginner traders do, it rarely works. Making prediction about how the market is going to act on a certain day will put you at a psychological bias towards that prediction, blinding you from making logical decisions.
The market is dynamic—moving all the time and its ability to move freely is what dictates the trade. Even if you choose to make a prediction, wait for the currency to react accordingly and affirm your prediction before you make a decision.
Avoid giving in to these myths and you will surely set yourself up for up success. Learn forex trading fundamentals with us through our private mentoring sessions. Feel free to get in touch with us for more information.