In the beginning of the article, let me get one point very straight. If you are here to find out a way to earn fast money, I would suggest you to close this page right now and search for other things on Google promising you a quick buck because what I will tell you, is 100% genuine information and I don't want to get your hopes high with false promises.
OK, since you are still reading, I believe that you are really interested in constant and hard earned money, so without wasting time let's get directly to the crux of the problem.
Forex market is a market where information makes a lot of impact and prices adjust very fast, as the complete trading network is electronic and people from across the Globe are connected to one price panel; extremely experienced traders are sitting there, keeping their eyes open to seek profit.
Now the question is how you as a trader, can succeed in such a fast market.
Here is a 5 step formula:
1) Technical Analysis
2) Fundamental Analysis
3) News / Sentiments
5) Keeping a stable mindset
Now I would like to explain what these 5 steps are and how they influence your learning curve.
1) Technical Analysis: This analysis is based on the past results. Tech analysis tracks how prices have moved and what patterns have been created in past, it's very important to know it, so that you understood the boundaries of movement of prices. Further, there are many indicators which reveal how the prices are working in comparison to the past and in which direction.
This analysis also shows the patterns of investors / traders behavior, indicating how the investors and traders behave in a given time period and situation and a lot of time these patterns form a perfect opportunity to replicate your profits.
2) Fundamental Analysis: It won't be wrong to say that this is the most important analysis as it forms the logic of the price movement. It focuses on the overall state of the economy and considers various financial data and/or political news, released by the governments of different countries, like unemployment or manufacturing data, GDP growth data, interest rates etc., so fundamental analysis always forms the core of the price movement.
3) News / Sentiments: Well, as I mentioned above, trading is a combination of different factors. Sometimes the technical analysis is saying that a particular currency should go up but the market sentiment is negative about it, the reason might be a future data which traders already know is going to be negative or they might not have full confidence on the current data released by government, so before making the final trading decision you should see the complete picture.
Now the million dollar question over here is how to know the sentiments of traders and that is exactly what is my next point is all about.
4) NETWORK NETWORK & NETWORK: I can repeat this a million times more if you ask me, it is of utmost importance to network with traders in order to learn, because trading becomes 100 times more risk-free when you discuss your strategies and share and learn from the experiences of others. Please join some Forex groups on Facebook and join forexcamping, a website specifically made for learning and sharing Forex wisdom, I will repeat my words again with the request, "PLEASE NETWORK."
5) Keep a Stable mindset: It is insanely important to keep a stable mindset and by stable mindset I mean a really stable mindset. A small example here; if you won 500 USD in market you would be like OK, its fine, not a big deal but in case you lost 500 USD, you will be like OH MY GOD, what on earth has happened to me, God why are you so mean to me and so on and so on and so on. Thus keep stability in your mindset, set your risk limits and then fix your stop-loss levels accordingly.
And in the end I would just like to say, keep practicing on demo accounts, don't burn your money directly, learn first, experiment with markets and then fill in your accounts with the green stuff.