What is the largest hurdle you have personally had while trying to learn or trade FX? Has anything stuck out to you that you would need help with in your journey of learning and trading FX?
I do not think there is any specific hurdle to trading fx specifically, as opposed to other asset classes. A general hurdle for all trading I would identify for all beginners is to be exposed to a very good mentor who can guide beginners through the process. I would identify several topics that most beginners lack: 1) Right attitude: Learning a new topic requires hard work, an open-minded attitude, patience, willing to experiment with different ideas. 2) The right mix between an appreciation for risk and fear of loss on one side and an appetite to expose oneself to risk to generate gains on the other side. Someone who can't pull the trigger is ill-suited to trading and equally cowboys and gamblers should not trade either. 3) A solid foundation of macro and microeconomics. Most beginners have no clue (and probably a fair share of those who have been in the market for years) how this world operates, the economic cycle, interest rates, employment, inflation, savings, spending, international trade, debt... 4) A solid understanding of financial math: Interest rates, discounted future cash flows, probability theory, basic pricing, and valuation theory 5) Knowledge of trading-related specifics: Different asset classes and their properties, underlying math and valuation approaches, exchange and contract specific mechanics,... Then, and only then should a beginner start to look at trading patterns, cycles, boom and bust cycles,.... The problem number one I would mention is that a lot of people want to skip all the mandatory steps and jump right into looking and asset trading patterns without really understanding what is going on in and around the world and asset pricing. This is often a result of impatience or pure laziness. Most retail traders believe they can trade in isolation and make their own fortunes, independently of all the other market participants. Nothing could be further from the truth. Any time one is invested in a risky asset one is competing with the best traders in the world, hence one generally never the top dog in this game and outcomes are directly dependent on also the performance of all counterparties, their intentions, their deceptions, and games. Hope this helps some beginners.
Fantastic, well thought out reply yet again. Thank you very much, I completely agree with everything you said actually. Any new traders who need some guidance, this reply is a fantastic place to start.
market-making brokers that trade against clients and use a variety of tactics to never let their clients profit.
we tend to treat trading books as if they are bible. the largest hurdle / deterrent is to decontaminate our minds from what we have learned from the professional writers/talkers and also to remove all indicators from our charts.
Great point! There is alot of information out there today, and not all information is good. Its better to learn the right things than learn the wrong things, and have to go through the process of unlearning before you can really get started.
Yes, I am facing the same issue. These technical indicators are mind boggling. Don’t know where to start and where to end. I think a mentor can only save me.