How to Master the Art of Forex Trading Without Losing Real Money -Demo Trading Account

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Trading can be extremely difficult if you don’t know how to trade the market properly. The forex market is a dynamic market and its gives profit to perfect traders in the world. If you are thinking to start your trading career only to make some quick bucks in the market than trading is not the right job for you. The professional traders have spent month’s years after years to master their trading strategy in the financial world. So if you are thinking that you will get rich quick without having a prior knowledge of the financial industry then you are completely wrong. Most of the rookie traders fail to make money in the online trading world since they start their trading career based on false confidence. Every single movement in the market can be interpreted with rational logic. As a trader, you need to find a rational logic behind every single trade in the market. You need to develop a strong trading foundation before you start trading with real money. If you follow proper method then you never have to lose a single penny at the end of the month since your trading system will ensure your profit in the longer time frame. Let’s discuss how we can master the art of forex trading without losing real money.

Three major types of analysis: There are three types of major analysis in the forex market. Most of the professional trader uses the technical analysis to execute their trade in the market. But in order to execute the perfect trade in the market, you need to assess the market based on three major types of analysis. Once the technical analysis is done then you should go for the fundamental analysis in the forex market. Fundamental analysis is the study of the economic performance of the country and it helps the traders to get a general overview of a certain currency strength. Last but not the least in the sentiment analysis. After all three types of analysis, you should execute orders in the market with proper risk management factors. If you are a new trader then you should open a demo trading account and trade the live market based on this three types of analysis. Never let your emotions to take any trade in the market. The moment you start trading with emotion is the very moment you will start losing your trading capital. So make sure that you demo trade the market for at least three months before you go live and if you do so you will be able to gather huge knowledge in the financial industry without losing any real money.

Know your trading environment: The forex market is extremely volatile and it exhibits different movement at different times. Most of the time it becomes extremely volatile during the event of the major news release in the market. So if you don’t have any prior experience in news trading then you can open a demo trading account and trade the news with your virtual dollar. This will allow you to adapt the extremely volatile conditions of the market without risking your own trading fund. Most of the novice traders incur heavy losses during the event of the major news release in the market since they totally don’t know about the market behaviors. As a full-time professional trader, you need to know about your trade execution speed and leverage so that you can scale your lot size under different market conditions to reduce the risk in the market. And always make sure that you are trading with no dealing desk brokers and all your orders should be directly executed in the market because if you don’t do so then very often you will have high slippage even during low volatile market conditions.

Find the perfect leverage for your trading: Leverage can be double edge sword in the market. Most of the novice traders think that high leverage will make them rich in the forex market. But in reality, leverage can be extremely dangerous if used in the hands of untrained professional. So before you start trading with real money make sure that you open a demo trading account and understand how the leverage system works. Leverage plays a crucial role in the in controlling the trader sentiment. If you think that you are an aggressive trader then you need to trade the market with low leverage but if you think that you can manage you risk very efficiently and take a trade with proper risk management factor than high leverage will help you in a diverse way. In the eyes of trained professional leverage is the most dangerous thing in the trading world since it directly impacts your potential earnings in the market. So you should try to trade the market with different leverage and find the best leverage for you. You might be thinking that you can control your emotions even after taking high leverage but when it comes to real life trading it’s really hard to control your emotions in the extremely leveraged trading account.

Summary, Forex is just like any other business in the world. In order to make consistent profit in forex trading, you need to have a valid trading strategy and you need to learn how to control your emotions in the market. As a full-time professional trader, you must know your trading environment very precisely and manage your trade under extreme market conditions with proper risk management factors. And always make sure that you execute your trading orders in the market based on major three types of analysis in the forex market.

 

Greetings,
I believe the Demo Account is helpful just for mastering the strategy (entry, exits, position sizing and managing the trade). In order to achieve complete control over your trades and account Live account is needed (even a small would be better then Demo).

Bottom line: Just demo would not be enough. Cannot reach professional level of trading just via demo.

 
I do agree that the Demo account could help you to become well acquainted with the environment, to know the trend to see how the leverage work, but it could not make u professional. As FrancoisT sais – it won’t be enough. Plus, most of the demos are without slippage when the order is executed and that may not show the reflect of the real market.
 
Certainly when you have no experience at all trading on Demo is a good foundation. But as you guys have said it is not enough in order to become a successful professional trader. Demo does not provide the same conditions as the Live account such as prices, stop out level, order execution, therefore no emotions are involved.
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