Hello traders and investors!
This is Nathan Tucci discussing some fundamental things that should be learned for beginning currency traders. Before I get into the meat of the article, I do have one major request that we’d really appreciate you taking a second to help us out with:
If you’re a beginning currency trader or maybe new to currency trading even though you’ve traded other things, would you leave a simple comment and let us know? Quite frankly, we have no idea what size the group is of new Forex traders and we’d really like to learn more about that.
We are even thinking about publishing a course for beginners to help them get started on the right foot so they can be successful, but again we don’t know if that would be valuable because we don’t really know what size group we’d be addressing with something like that.
So, if you’d leave a comment letting us know “Hey, I am new to this stuff” we’d be very grateful!
You know, a ton of people are searching for ways to make money every day (that probably isn’t surprising to you) and a lot of them are hearing about this “Forex” stuff.
Although Forex Trading can be a great way to make additional income, most of the people who stumble upon Forex never make a penny.
I believe there are 3 key factors that are causing this epidemic.
#1 The Forex Industry
The industry, itself, is not conducive to helping traders make money. It is littered with Get Rich Quick Scams, Self Proclaimed Gurus, False Methodology, Bad Software, Crappy Indicators, Greedy Brokers, Shady Websites, and the list goes on.
Ninety percent of the information, tools and people you in the “Online Forex Industry” are leading people in the exact opposite direction they’re trying to go, so it’s no surprise that 90+ percent of them end up failing.
The problem is that anything (and I mean ANYTHING) that can be used to make money will attract some shady people.
If they can dangle the idea of “Make money online” in front of you, it’s an easy way to get people to buy in. Forex is not an easy way to make tons of money overnight, but that doesn’t stop shameless marketers from promising that over and over.
All in all, the industry makes it incredibly difficult for a beginning trader (or someone new to Forex) to make any real progress in achieving a profitable venture via currency trading.
Some would like to say that this is the only problem with the validity of Forex trading, that if it wasn’t for all the scammers out there that trading would be sensible and easy and tons of people would be getting wealthy doing it; however I strongly disagree.
Though I would concede that the overwhelming supply of scams and false information is probably the biggest problem with currency trading, it is not the only problem.
#2 The Process
One of the glaring problems I see in Forex Trading (specifically in the education aspect) is that there is no defined process for how to learn and grow and eventually do it well.
Instead, there are just bits of information, guides on good strategies, webinars on important topics, etc.
And trust me, we are guilty of aiding this process, or the lack of the process more accurately.
Not that any of those things are bad (topics, strategies, reports), but they don’t make up for a defined process to become better at a specific task–in this case, trading.
I will use my over-done golf example again because it applies here once more.
If you wanted to play golf and you learned bits of technique:
- How to hit a flop shot
- How to take spin off the ball or add spin to the ball
- How to get more distance
- How to stop slicing it off the tee
- What kind of clubs are right for you
- The best ball for your game
- How to use less hips and more shoulders
- Tips to keeping your head still
- Tools to help your balance
And I could go on forever here, but you get the idea.
ALL of those things are good and all of them even have a place WITHIN the process to becoming a good golfer, but just learning them in random fashion without the fundamental training and practice to get to a point where you can use them successfully, they will just confuse you and cause you to fail.
This is SO similar to the trading process that most people are going through. They are getting tools and learning techniques and hearing tips and they wonder why it isn’t helping them make money.
More often than not, it’s a situation where there is not a foundation in place to use these things successfully.
You are trying to hit a 300 yard fade around the trees on the right side of the fairway before you even learned the proper way to swing a golf club
Any golf guru would tell you that’s a bad place to start, yet for some reason we are content letting “Wanna Be Traders” start by attending webinars on advanced trading strategies.
To me, this is a fundamental reason we are seeing such a high rate of failure for Currency (and other markets) traders:
There’s not an understandable process laid out for traders to walk through. But this leads me to my third point. The last thing fundamental issue that is plaguing new traders from making any ground in this game–the one that most people don’t want to talk about.
Uh oh, this one could step on some toes and I apologize.. but that’s not my intent; and of course when I say “you” that doesn’t mean everyone reading this article, it only applies to the people who it applies to
See, one of the biggest issues we have with this epidemic of failing traders is that people come into it totally unfit to be successful.
We talked about all the scam artist and the “make millions gurus” but let’s be honest for one second:
It’s not just their fault. I mean, they couldn’t sell anything if people weren’t buying into that crap about getting rich with Forex overnight.
So a lot of the responsibility lies on the new trader who has a bad foundation before they even begin this trading journey.
If you googled “How to make the most money in the fastest way possible” and found Forex trading, you just started in the wrong place and are basically doomed to failure from the start.
I hate to say that, but we need a reality check in this industry; if we are going to fix point #1 on this list, people need to get their heads right so that the industry follows suit.
I mean, if people are getting into currency trading like it’s the lottery, why wouldn’t the industry conform to that image?
I hate to be so harsh about this, but the truth is that this aspect may be the biggest epidemic of all…
So many people are looking for the “Quick and Easy” version of building wealth and it just doesn’t exist.
When people come into Forex as a beginner with no plan or vision or discipline, it results in a MASSIVE majority of them failing, and when you look at it from that angle, it’s no surprise.
Our encouragement to you IF you represent that beginner trying to succeed is to address these 3 issues.
1. Don’t follow the industry blindly
2. Find a process that makes sense and commit to it
3. Get your head right: Reasonable Expectations.
That’s All.. That’s my advice if you are new (or maybe just still struggling without a foundation) to this field and want to be successful.
P.S. Don’t forget to post a comment below! Let us know if you are new to Forex trading or would be interested in a course devoted to “The Basics”
P.P.S. Follow me on Twitter
P.P.P.S. Thanks for reading my article
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