Retail traders are often looking for information online, believe their expertise is not good enough to find trading opportunities constantly. Although that might be the case sometimes, the online world is packed with information provided by individuals interested more in their personal gain, rather than helping traders. Using trading-related knowledge is good when it is done based on a few important principles.
# Follow experienced traders
This point in time is unique because never in history we had so much information on how to learn to trade FX. That does not mean all the FOREX gurus are worth following. When searching for information, focus on experienced traders, or people that have a proven track record in the world of finance. This will mean they have more experience than you and as a result, are able to provide insightful knowledge into the world of trading. When it comes to trading ideas, it is always critical to follow people that have already shared their real trades in the past and generated profits in the market.
# Look for info that makes sense
The world of trading works based on cause-effect relationships, which means there’s nothing esoteric or any conspiracy determining how the markets function. As a result, it is important to always look for information that makes sense and can be proven easily. Trading is a rules-based activity and without solid knowledge, you’ll constantly be fearful to pull the trigger, thinking the trade won’t work out. If you can’t understand it, then it’s not something you should use, no matter what any expert is telling you. Since trading is a game of probabilities, it is crucial that your trading process will be based on solid data and won’t look like a gamble.
# Use the information as an additional tool
No matter how good we are, there’s always someone better, holding insightful information about FX trading. That does not mean all the responsibility should fall under someone else. The most important thing is to have a rules-based system that had proven to work over time and constantly rely on it. All the information we’re looking for is only an additional tool to further enhance what we already know. Trading education, risk management, timing, understanding macro data, these are all part of the process and must be part of the knowledge base we have. Professionals traders are responsible for what they do and don’t need anybody else to help them with new trading ideas all the time.