While Forex, as a market based on the currency exchange rate, seems a logical thing to comprehend and learn, it’s as well perceived as a global hype system (though a strangely long-living one). Millions of new traders yearly join Forex, but there are way fewer success stories. Unlike another popular form of CDFs Forex is only about currencies and equivalent assets like gold or cryptocurrencies.
Popular as it is, Forex generates a lot of rumors with the very fact of its existence and accessibility. Is it really a gold mine only a happy few notice? Or are these happy few just rascals selling castles in the air to amateur traders? Here are some answers that can help a potential trader decide whether it’s worth it.
Forex Is Hard to Understand
Partly true. Many traders use higher mathematic skills to develop mathematical models to predict tendencies for this or that pair, software assistants that monitor changes 24/7, or study through gigantic libraries. On the other hand, some may perceive it as a sort of gambling, place their bets and suddenly win. Alas, this is too poor a basis for building a system (though solid enough if you’re here primarily for fun).
Forex is an Internet Thing
False. Forex as a separate market appeared in 1973 – that is, 18 years before the Internet. As the Bretton Wood system was replaced with market-based Jamaica Accords, the market became a great playground for profit from floating prices. Forex, as we know it today, is resting on these.
On the other hand, Forex as an attractive way of investing and earning is really an Internet thing. You do not have to visit ultramodern buildings stuffed with hi-tech analytic hardware and software, with great minds working together on making money. You can do it alone on your smartphone, at home, on a train, whatever. And this caused the next rumor.
Forex Is for Everyone
Formally true. Now everyone can register at one of those numerous Forex sites or install a mobile app. Libraries of articles and books, months and years of videos are available on every aspect of Forex, and while some of them are paid, others are free. There are even demo accounts that show how the business is done.
Still, for most traders, the story ends too soon. After losing all they have invested, they give up on Forex. And it’s hard to judge them for spreading stories of their failures. They might have just treated it as a lottery while trading. A big mistake! If you’re ready to spend money for fun, you can see Forex as a sort of casino. But serious trading requires serious investments – both financial and personal.
Forex Is All About Hype and Fraud
False. There are brokers that do not show the pattern of righteousness and fairness. They can even inject incorrect exchange rates to make a trader go wrong or provoke an unreasoned margin call. Hardly has ever heard of anyone who has made a fortune with this type of broker, and when someone claims, they say it’s a fictional person.
On the other hand, there are traders who made fortunes on Forex. And we can’t deny they have made it. So there is more to Forex than losing your investments. It’s another question whether it’s a matter of skill or luck.
There Are 100% Working Strategies
Probably false. Imagine you know one 100% winning strategy. Would you ever reveal the very fact you have one? Instead, you would use it carefully, in order to avoid suspicions, but getting sure money. And only your mistake would reveal the fact it has ever existed. On the other hand, as soon as this strategy is exposed, it starts changing the market. Traders change rules to make it inapplicable anymore. So probably this conspiracy theory is wrong too.
There Are No Working Strategies
Probably false too. At least, no strategy can be presented as an algorithm as long as the world is irrational. Unpredictable events (so-called black swans) do not contradict nature, but their probability is too low to be taken seriously or expected somehow. Human behavior is also somewhat irrational. As all these factors affect the market, a great trader would be ready that they may hit any moment, and so they react swiftly when they do. But can this swiftness be a part of a common strategy? We guess it’s rather a personal trace.
Signals Are a Way to Succeed
False. As the forex market is large and craving for information, it’s provided by companies that analyze the situation and have specialized software, performance and access to updates. Signals are provided for free or for money. In theory, a trader that receives a signal can react immediately and start or close a deal at the best time.
In real life, though, signals are a perfect cover for fraud, as the signal provider never takes full responsibility. More than that: most information that signals deliver is based on common knowledge and exposed facts and trends. Signals may help a novice, but novices as well have the most chances to fall victim. An experienced trader, though, can make more use of signals.
Learning Forex Tricks Is Useful
Definitely true! Aside from making money on Forex, you master a lot of skills – from fact-checking and predicting trends to reading candlestick patterns or learning financial terms. No matter if you succeed there, you might need them for your next business or job.
But what’s even more important is the art of learning. Not surrendering after the first mistake. Analyzing where you went wrong and not repeating the same error. Recognizing the traces that prevent you from acting right and changing them. Consistency. Self-control. An open mind. Even if you get disappointed in Forex, these things will serve you right.
Forex as an Art
Probably that’s the closest thing to reality. To succeed in this market, one needs to learn existing strategies and tools, still acknowledging that none of them is perfect and versatile. Intuition, alertness, sometimes irrational bravery, or visceral caution are the keys. There are elements of gambling, as we always deal with higher powers, but knowledge of both the rules and the world increases your chances.
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