4 Myths That Most Beginner Forex Traders Would Like to Believe

By Leo Dimilo

If you were to google the term "forex" you would get 57 million pages, most of which is complete garbage. Now I say this with a slight hint of reservation but understand that in the short 5 years of me trading on the FX market, I have come across outright scams, automated "systems" that supposedly would make an investor rich, gurus that profess huge returns if you allow them to trade using managed accounts, books that make outstanding claims ect. ect. The list goes on and on.

I am going to attempt to blow apart a lot of these "myths" that seem to circumvent the forex market online and hopefully, you will be able to use common sense when approaching these "products" and give you a solution that you can research to better help you with your trades.

Myth #1

You can easily double your forex account by using (stick a broker or site name here).

Reality- Any site or broker that can give you a fixed percentage per month (like 10%) is doing something with your money other than trading forex. That is the bottom line and it doesn't matter if you think that it must be real because the site has been paying for several months.

My own experience: I had a managed account with an unsaid site that was averaging 20% per month and had been in operation for a couple years. I was quite pleased with the results and then all of a sudden, they vanished into cyber space...along with my money. This was a lesson learned the hard way but I want to tell you that if it sounds too good to be true, then...it is too good to be true.

As an aside, there are thousands of sites that claim to be trading forex. Most promise returns upwards of 50-100% per month. It is simply not possible.

Myth #2

Automated Software is better than Human Based Trading

• I have heard this spouted about since I came online and started trading. The idea is this...by taking away the human emotion, you can make significant profits. Since Fear and Greed moves the market, a computer based product that just crunches numbers should be able to accurately predict the market.

Reality- Automated Software does not work because the market moves because of human greed and emotion....

Real life Example- a couple years ago, after seeing automated system after system touted, I finally took the plunge and bought some software that would make my trades automatic. Luckily for me, I tested the bot using a demo account because after a month's time, I would have gone broke. The bottom line is that a computer can only implement indicators, much like a human can.

As an aside, if someone developed a "bot" that could do the dirty work for you and succeed, why on earth would someone sell it? Think about it...if it is too good to be true, it normally is.

Myth #3

Trading the news is the quickest way to profits and even a newbie can do it.

Reality- While it is true that trading the news can result in some significant jumps in PIPS, it also has a few can of worms that most traders won't tell you about....

• Getting in on these trades has to be quick and most platforms perform typically slower than normal during these high volume times. The worst part of this is that you can't tell which brokerage firm is the better because the trades are seemless on demo accounts. The result is you get in trades but sometimes can't get out.

Real Life Example- I was subscribed to a service where the trader had a chat room in which trader's could come in. He had one of those fancy Reuters news tickers (that cost $2,500+) in which he could get the news at the exact same time that the banks got them. Basically, he would get the news and type "buy" or "sell" or "do nothing". When something hot broke, it would sometimes break for 60+ PIPS. That would have been great if I could have gotten in on the trade. However, I tried 5 different platforms and all of them were either very slow to open the trade (resulting in a loss of profit) or crashed at the time of the news....not good.

I investigated this and found that my problem wasn't just me. Other trader's had the same exact problem.

Now, my only way to combat this was to "guess" which way the market would go and place a stop/loss point on the other side just in case it went the other way. Then again...that is not trading...that is gambling...

Lesson learned: If you are going to trade the news, be prepared for some major frustration along the way.

Myth #4

You can make a lot of money consistently trading short term time frames (day trading)..

Reality- The key word is consistently. There are two things that are certain with trading forex. One, the market will rise....and two, the market will fall. With short time frames, you are basically guesstimating which way the market will go. And the market moves in these short time frames without much reason. In other words, it is no better than flipping a coin. Technical and chart analysis is absolutely pointless in these short time frames. If you don't believe me, spend a week watching these numbers and do all the chart analysis you want....Without knowing the long term trends, you are no more than a gambler betting red or black.

This said, there is only one PROVEN technical indicator in stock OR forex trading. And that is understanding retracements and how to chart using fibronacci techniques. Basically, it implies that when a market starts a pull back or rally, normally there are some keypoints that it retraces back to. The most important number is 50% (or the 50% retracement rule).

Now, I am not going to say that it is a slam dunk (there is none in trading). However, if you use history as an indicator, then you would see that the 50% retracement rule actually works more often than not.

Leo Dimilo has been trading forex as a hobby for 5 years now and has his share of bumps and bruises along the way. He has made alot of money AND lost a lot of money along the way.
Forex Trading for Beginners

Article Source: http://EzineArticles.com/?expert=Leo_Dimilo

Believe In Your Abilities To Succeed

By Kevin Sinclair

Your self belief directly influences your destiny and success in life. The beliefs that matter most in life are those that are deeply and often unconsciously held. On the surface, you may think that you believe you deserve the best in life but if your deeply and unconsciously held belief is that you are unloved, unworthy, and incapable of achieving the success you desire, then you will find success and happiness difficult to attain.

Success is a gift you give yourself as a direct result of the beliefs you hold about yourself.
Therefore, it is extremely important to evaluate your beliefs and become aware of any that are holding you back or even worse, bringing the very things that you don't want into your life.

Success is the result of choosing the right goals for your life and taking the most effective steps to achieve them. Our ability to do both these things is directly affected by the beliefs we hold about ourselves. Do we believe we are capable of achieving our goals? And if so, are those goals truly our own? Being true to yourself is an integral part of genuine success and it is impossible to be faithful to your own needs and purpose in life unless you understand what they are.

This means you need to be consciously aware of your deepest beliefs about life. The starting place of this consciousness is to ask yourself questions and then examine your responses. What is most important to you? For example, if your family is more important to you than your career, then in order to be successful you need to create a lifestyle that supports your family values while pursuing your career goals. If you do not do this, your true beliefs will cause you to sabotage your success.

If you are lonely and would like to experience love and romance in your life but you feel unattractive and expect rejection, you will probably not even try to meet people or will drive people away because of your lack of confidence.

The good news is that when you change your beliefs you change your destiny. Thus, your beliefs directly determine the success you achieve in life. Our beliefs influence our thoughts, feelings, words and actions, all of which paint the canvas of our lives with relationships, experiences, successes and failures. Therefore, if you are not successful in any area of your life, consider your habitual thinking about that area, the words you speak about it and the deeply held beliefs these may reflect.

Repetitive experiences in any area such as job loss, insufficient income and relationship break ups are also an indication of deeply held but often unacknowledged beliefs that can rob you of happiness. Alternatively, your successes also reflect your beliefs. For example, those of you who have overcome difficulties to achieve a goal such as a college degree, promotion or other personal goals have been able to do so because of beliefs that support you.

The obvious and most important belief you can have is that you can actually do the thing you desire to do. If you believe you can't do something then that will be true for you. Fortunately, your self beliefs can be changed and so too can your life.

The first step to changing limiting beliefs is to understand what they are. You can do this by monitoring your self talk. Do you put yourself down a lot? Do you feel like a failure and tell yourself so? Keep a record of what you are telling yourself for a couple of weeks. You are looking for those thoughts that repeat regularly because they will have the strongest impact on your life.
Once you have identified them you need to spend some time considering how they may have affected specific areas of your life.

What are the deeper beliefs about yourself that they reflect? Once you have identified the most powerful beliefs that are negatively affecting your life you need to develop strategies to change them. The most effective way to change beliefs is to attack them from multiple angles.

If you believe you cannot accomplish something then you need to begin to do things that will build your confidence in yourself by doing difficult things. Powerful changes can be made to your beliefs about yourself by doing dramatic and frightening things successfully such as sky diving, bungee jumping or learning to do something you have been afraid of such as flying a plane.

Longer term changes to beliefs can be accomplished by rewriting the negative beliefs positively and using them as affirmations. However, the more evidence you can find to prove the truth of these new beliefs the more effective they will be.

Finally, stay away from people who discourage you and try to set in place your old negative self beliefs. Unfortunately, you may need to cut some people out of your life altogether. You need to have people in your life who support your positive new beliefs.

Your beliefs determine your future; they are life and death to you. Therefore whatever undermines your future happiness must be discarded. Your life is a gift to you. Do not let anyone or anything rob you of your best possible destiny.

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