By your Trading Mentor
If you are brand new to trading and you have no idea where to even begin learning how to trade, here are the first things which you will want to consider to start trading in 2023.
WHAT KIND OF TRADER ARE YOU?
There are four main styles of trading and many markets to chose from, so it might seem overwhelming to decide what kind of trader you are going to be to start off with if you don’t know much about trading. However the decision may actually be easier than you think as it will often be determined by your circumstances which are already in place. For example, if you are working a full time job where you can’t look at your phone during the day and will only have the option to study the markets in the evening, then there is no way you can be a scalp trader looking at set ups on the New York Open.
Here is a breakdown on the different types of trader, often new traders will opt for trading on smaller time frames as it means they can take on less risk per trade, but as mentioned before, while you are learning, you may not have much option as your current job and circumstances will determine which kind of trader you’ll need to start off being.
Scalp trading is the quickest form of trading the financial markets. This means that traders are only really looking for small moves and will open and close their trades very quickly, often within the hour and sometimes only for a matter of minutes. Scalp traders will often use high leverage to make the most in the small fluctuations in price and will be looking for precise entries on small times frames at high volatility times including London Open, New York Open or big news events such as NPF.
Day trading is believed to be the most common form of trading forex and the stock market. This is when traders open and close their positions within the day, closing any trades before going to be in the evening. Sometimes this involves holding trades for one hour but often it is for a few hours. Day traders will often trade on time frames such as the 4H chart but will sometimes drop to smaller times frames such as the 15M for an exact entry and will often use the 1D chart to gauge long term momentum. Day traders will often use leverage on their trades to make the sometimes small daily fluctuations in the financial markets more profitable. For day traders timing is really key and they will often utilise key times of the day to maximise their profits such as session open times when there is often more volatility in the markets
Swing trading is a slightly longer form of trading where traders will hold their trades for at least one night and sometimes for weeks. Swing traders are aiming to make the most in the swings in the market, which are essentially the longer trends which take place. Often swing traders will look for entries on the 4h chart but will also be using 1D and 1W in their technical analysis. Swing traders will also be really interested in big news events which set the semi long term direction of trends, such as interest rates decisions, CPI or NFP.
Position trading is the longest form of trading, these traders will be looking at high times frames and wont be too interested in the small fluctuations in price. These traders wont necessarily need as much leverage as they are really interested in the very long term trend of the market and will be happy to hold their position for weeks, months and even years. Position traders may be interested in fundamental factors such as how the countries economy is doing long term, political parties in power can have an impact, as well as fiscal policy.
As mentioned above, the type of trader you decide to be will tend to depend on your current circumstances and how you can fit your trading education and practice in and around your current job. For newer traders, day trading or scalp trading the London open before work can provide a sustainable solution.
TYPES OF MARKET TO TRADE
Once you have decided what type of trader you are going to be you will also want to decide what market you are going be trading. Some countries also have different restrictions so you’ll have to work with what you have in the country you are living in. And you’ll also want to opt for trading markets which are relatively easy to trade with low spreads. This means markets which are popular to trade rather than any exotic markets, the more a market is traded, often the lower the spread which is the commission your broker takes per trade.
For example, if you were to be a forex trader I would suggest looking at the currency pair EURUSD to focus on as this is the most commonly traded and has a very low spread compared to a pair such as NZDCAD.
Forex (foreign exchange) trading is often considered to be one of the more complicated markets to trade so some will advise starting on forex so that it will all be easier following on from there. However some will advise starting with markets which are a little more straightforward. Personally I began on forex trading and then found some luck trading commodities such as coffee and cocoa, I then moved onto indices which are my current preference although I still trade all of the above as well as the occasional crypto currency and stock. I do think single focusing, especially when you are new is really helpful. Pick a market and attempt to be a specialist in it. While it doesn’t matter too much which one you pick, if possible opt for one where you would be genuinely interested to research on the different factors which affect supply and demand as you will need to do a lot of this and also likely will need to develop a checklist of fundamental factors to check each day before placing any trade.
PICK A BROKER, ANY BROKER (not that one..)
Picking a good broker is key to success as a trader as you’ll first of all want to know that your money is actually safe, but also that you aren’t going to be charged huge amounts of money to place each trade. Especially if you are going to be a scalp trader it’s really important to make sure you keep spreads tight. There are other reasons why being selective with your broker is important. You’ll want to know key details like how often are you able to withdraw your profits? Will you be charged for withdrawing you profits? And who can you contact if anything goes wrong? Is the platform easy and straightforward to use?
Which broker you chose to go with will largely depend on which country you are in as each country has their own restrictions and limitations. If you are in the UK like me then I would suggest going with a broker who is FSCS protected which means that if anything goes wrong with the broker, your money will be protected up to £85,000. I also prefer to use the platform MetaTrader5 to place my trades on my phone. Most brokers will have the option to connect to MT5 which means you only have to get used to trading on that one platform. Some brokers have their own apps but my experience with these in the past have been that they are not as user friendly as MetaTrader.
I recommend the broker TioMarkets – you can sign up here using this link:
DO I NEED TO INVEST IN EXPENSIVE TRADING SOFTEWARE?
No! There is no need to fork out huge amounts for expensive trading platform. I’ve used a free platform called TradingView since the very first day I started trading and it is more then enough for my technical analysis. There are paid versions of TradingView if you decide that you want more options and even these are affordable. I pay something like £11 a month for the Pro version. You can also trial the Pro version for free for a month and see if you think it will be worth paying the extra for. You can use this link for the free trial (just remember to cancel before the month is up if you don’t want to carry on with the subscription)
HOW WILL I LEARN THE BASICS?
There are many options to learn the basics to get you started. When I first started learning how to trade I read loads of trading books and played around with small lots sizes, although admittedly this was the very long way around things. I also watched a lot of YouTube videos which were very helpful and the best thing is YouTube is FREE!!
Here is a FREE trading course video I made for complete beginners to help kickstart their trading journey:
You can also go down the mentorship route which is one of the quickest and easiest ways to learn how to trade, although it is often not the cheapest. Firstly, what is a forex trading mentor? A mentor is anyone who is closer to where you want to be then you are at the moment. Or they are exactly where you want to be. A trading mentor can be someone with just a couple years more experience than you, or someone with many more years of experience. Ultimately, getting a mentor in any area is really one of the greatest life hacks there is. Having a good mentor is excellent leverage getting to the next stage in your career. Some careers are so difficult to climb that it’s almost impossible to do without a mentor. And most of the time it’s just easier and quicker to succeed if you do have a mentor. Getting mentorship can save you a lot of time and money in trial and error and fast track you straight to learning the proven strategies which have worked for another trader. Spaces are limited for Trading Angel’s Mentorship programme, however, each month as existing traders feel confident enough to trade on their own, new spaces open up. You can apply for the Trading Angel mentorship program wait list by using the contact form on the website
You will be taught a minimum of four trading strategies by your forex trading mentor in the programme. If you are more experienced or a quick learner then there is the option to learn more. The four main strategies are trend trading, reversal trading, momentum trading and breakout trading. These are the four strategies which your trading mentor uses each day when looking for trade setups herself. Each trading strategy comes with a set of instructions following the Trading Angel Stages Of A Trade guide and these will be emailed to you in a printable format after your trading class. Each strategy also comes with a printable checklist to help new traders so they can physically tick off the stages as they go through them and keep a record of the trades they have placed and why.
Alternatively Trading Angel also has an online course which is available.
This is great for those who like to learn by watching videos and go at their own pace. Members of Trading Angel Academy will have lifetime access to all the videos, printouts, updates and strategies just like those who go with the 1-2-1 mentor option, but they have the ability of going as fast or as slow as they like whilst having the luxury of re-watching the videos as many times as needed. Academy members will also get bonuses such as priority to attend live trading sessions where they will have access to ask their trading mentor any questions they like, and discounts on 1-2-1 mentor sessions. You can sign up to Trading Angel Academy here:
And, until next time Happy Trading
Love From, Your Trading Mentor,
Trading Angel x