What Do You Need to Know as a New Trader?
Trading is a lucrative world for professionals and talented persons that practice it. However, it can easily harm novices mostly because of the sheer lack of knowledge. Also, the glamorous life portrayed by some fake traders make the trading industry attractive to novices. As such, it would be fair to share some basic things to help any new trader get a head start in this appealing world of the financial markets.
Basic market terms are important for a new trader to understand as this helps grasp the language used easily. The first term is RISK, risk is literally the amount of money or capital you are can lose in the markets. It is important to note that you should commit resources that you are willing to lose. The second term is REWARD, which means the gains you can potentially make in the markets. A good website to get you started from a beginner level is babypips.com, it will equip you with the most basic information that you need to advance your knowledge in the financial markets.
The third term is Fundamentals, which are the news releases given by governments, institutions and any other relevant information that can potentially affect the movement of the financial markets. The Economic Calendar outlines weekly and monthly news that help a trader plan his or her positions in the market. It is mostly recommended that one should not trade the news as it amounts to gambling.
Fourth and last is technicals, which ideally is the structure of the market. The most common phrase in technicals is supply and demand. The market is moved by a supply of buyers and demand of sellers. The two tenets of the market forces help the markets outline areas where one can see supply or demand. Sometimes the markets will have an equilibrium of buyers and sellers and will result in consolidations where the markets move around a zone without major price fluctuations, an occurrence referred to as a ranging market condition.
Most important for any novice trader is to join a trading community. There are myriads of trading communities that can help you as a trader navigate the challenges that trading comes with. Find more details on this topic on our YouTube channel, VALUE GALACTICA. Do not forget to like and subscribe. See you on the next one.
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