STEP 1 in becoming a successful trader - Determing Your Trading Style

One of the first things I learned when I first began trading FOREX was that there are SO MANY ways to trade in this market, and many different strategies can lead to success. The hardest part for me, however, was figuring out which strategy suited me best. Everyone is different, and until you can answer certain key questions about yourself, you will never be able to pick a strategy in which you can be successful. These critical questions are:

1. How much time can I consistently allocate to learning, training, back-testing, etc?

2. When am I consistently available to trade? Can I look at my computer once a day, twice a day, every 3 hours, once per hour, etc?

3. What is my risk tolerance? Am I the type of person who can afford to risk a lot with the hope of a high return, and higher potential for loss? Or, am I more conservative, happier with lower returns with lower risk?

4. How much money do I have to initially invest and/or potentially lose?

Once you answer these questions, you can begin to narrow down your choices. You can figure out which currency or currency pairs would be best for you; how many pairs you would like to trade at one time; the time frame or time frames to trade on; the type of account you will want; and the best trading strategy for you.

It has taken me literally years to find a trading strategy that matches my personal trading style. It doesn't have to take you as long as it took me to find your  strategy, as long as you're real about the answers to the above questions. Can you answer the questions above? What is your trading style?

to be continued...