How do I start studying trading?

Trading is not something you want to pick up as you go along since learning on the job would be too costly. If large capital is invested, a lot of money stands to be made or lost in trading, so giving oneself the best chance for success is crucial.

That is why many aspiring and experienced traders equip themselves with various educational tools before entering the markets.

Eventually, Demo or Cent accounts can be used for cost-effective practice, but you certainly don’t want to start with a real account just hoping for the best. Before trading live funds, educational trading courses are highly advisable.

Finding a Suitable Trading Course

A wealth of forex and general trading courses can be attended in person or online. The providers of these courses tend to be educational centres, individual traders and CFD brokers.

In the earlier days of online trading, most courses were paid for. However, over time, many free courses emerged without compromising on quality.

Learn to Calculate Lots, Spreads, Margin Requirements and P&L

Most courses will begin by explaining the mechanics of how trading works. For starters, currency pair quotations should be presented, illustrating that traders will profit or lose by the difference between the price at which the trade opens and the price at which it closes.

If a trader believes that an asset’s value is due to rise then they should open a buy trade, aiming to exit if the price does indeed rise. Conversely, if they believe the value is due to fall, then they should open a sell trade, hoping to exit the trade once the price has fallen.

A small difference exists between the Buy quote and the Sell quote, ensuring that no matter the direction the trader opens the position, they will begin at a loss equal to this price disparity. This disparity is called Spread, which is the forex broker’s revenue on every trade placed.

The course should teach traders how to calculate these values and multiply them depending on how many units are traded and how much leverage is used.

The combination of units (or lots) and leverage will also determine the capital (margin requirement) that must be invested to open the trade.

Understanding Fundamental Analysis

After understanding how trading works, traders should study what moves market prices. The law of Supply and Demand applies here.

The higher the demand for an asset, the higher its price will move. The lower the demand, the lower the price. Therefore, it is important to study what influences demand – expectation.

Expectations are the result of information regarding the market. If the trader is in the stock market, they will form their expectations based on information surrounding a specific company.

These will include earning reports, new products, competitor performance, board activity and more. The same concepts apply to the 外汇市场.

Political events, government and central bank policy changes, employment and other data releases on economic health will influence the currency in question. The study of the overall state of the market and economy is known as 基本面分析.

Grasp Technical Analysis

Another popular method traders use to anticipate price movement is analysing past market data. By doing so, traders hope to identify repeated patterns upon which they can eventually capitalise. This is known as 技术分析.

Price patterns are observed visually on charts and numerically using mathematical formulas that indicate levels at which the price is expected to behave in a certain way. These mathematical tools are known as technical indicators.

It may sound daunting at first however the important part is not understanding exactly how indicators are derived, but more so to be aware of their existence and how to use them to your advantage. Traders are therefore advised to dive into technical analysis as part of their studies.

Explore Strategies and Healthy Trading Habits

The final piece to the educational puzzle is to become aware of how to effectively combine all the information gathered in the analysis courses for optimal outcomes long term. Traders tend to adopt different styles, largely based on character, risk appetite and time available to dedicate to trading.

Risk management involves decisions such as how long to hold on to a winning trade and how quickly to abort a losing one, but also the amount of capital one is willing to allocate to their daily and yearly trading endeavours.

Traders should also become aware that there is a large psychological and emotional component to trading that is important to manage correctly.

Stay Updated on Current Events, Seminars and Trading Alerts

Staying immersed in the world of trading is the best way to avoid stagnation and promote evolution. Involvement can come from receiving Economic Calendar updates, joining online trading communities, forums, and Discord channels, or simply reading financial and political news.

There are also plenty of services that provide signals and trading alerts although these are usually not free. Most traders will develop a habitual overreliance on such services hoping to bypass the need for individual research and study.

However, used in conjunction with a strong educational foundation, signals can be used as a second opinion to validate one’s own findings.

Other modern AI-based tools, such as IronFX’s Trading Central bring a whole new dimension to the modern trader. Trading Central is a comprehensive analysis tool that provides traders with market insights and technical analysis.

It offers real-time trading signals, expert reports, chart patterns，並且 经济新闻, helping traders make informed decisions. food for thought which can be practically applied at the trader’s discretion.

Lastly, for traders who prefer a more interactive and human approach, online video lessons and live webinars are available.

Webinars are particularly useful since the information is often related to current events and presented by an industry expert who allows for a question-and-answer section where participants can clear up their uncertainties.

IronFX Academy

IronFX is a globally established broker that places huge emphasis on free education. The IronFX Academy provides an easy-to-follow and practical approach to studying trading.

Educational resources include webinars, eBooks, and videos while the broker provides Demo and Cent accounts to implement strategies before progressing to Standard, Premium or VIP accounts.

Disclaimer: This information is not considered investment advice or an investment recommendation, but instead a marketing communication. IronFX is not responsible for any data or information provided by third parties referenced, or hyperlinked, in this communication.