1.Forex trading is very easy to take on board
There are many different myths with forex trading, the very first myth is that people think it is easy to generate profits from trading on the markets and jump right into it. This is the biggest misconception the amateur makes. You can’t just install a piece of software and start making money, it takes time and effort to perfect the craft.
2.You have to get a degree in Trading From a University
This is incorrect, you do not need to have studied at university, but it does help to know about how the financial markets work and how the markets move up and down. Most retail forex traders have no prior background in economics and can come from all different walks of life. It’s all about having an analytical mind and understanding of things. Although it may help if you learn from veteran traders that have actually traded the markets, as this would increase your chances of profitability
3.You must know economics and understand Geopolitics
This can be true to a certain extent, but it is not what makes a trader profitable in the markets. What makes a trader profitable is being able to execute a plan without being tempted to waver by the potential of vast quantities of money. You will need to analyse charts and make predictions, but it comes down to your reactions and executing the entry correctly.
4.To be able to trade forex you need a lot of money
Many people think you must have 6 figure sums to trade with, in order to profit from the market. As when they hear the term forex they things of a 7 Trillion Dollar Market. This is not the case, forex is very different to stocks where you do need large amounts to profit quickly. In forex trading you can leverage against the amount in your account effectively trading at a larger size to profit quickly. Knowing how to take advantage from leverage can help you profit with smaller account sizes.
5.You need to sit in front or your pc or laptop all day long
This is not true at all; the beauty of forex and other financial trading is that it allows you the freedom to do other things like at the same time. In forex you can place all your potential trades at the start of the day or the night before making more use of the time you spend during the day. Most traders have full time jobs and manage to allocate time to trading when they are no working.
6.There is a holy grail to trading forex
Thinking you have something no one else does will not make you profitable, trading has been done the same way for hundreds of years and trying to come up with some new technique will make you worse not better. You need to learn the correct way to begin with before getting into bad habits.
7.Higher Leverage can increase your profitability and make money quickly
This is false, higher leverages in fact lead to bigger losses as traders get carried away and will risk more then they should per trade. Trading within your means is always the best way to go about it and learning from a professional on how to manage your leverage is key before you start trading live.
8.Forex is a get rich quick scheme
In no way should forex be used to try to get rich quickly, you will almost always lose if this is your mindset before going into forex. Trading takes time and effort to perfect your technique, this is not just analysis but always risk and trade management. There are no shortcuts in trading!
9.More complex strategies means better results
The philosophy for all traders and life in general is keep it simple. Having a complex technique will lead to confusion when trading and confusion leads to results. If you had two paths with the same result, one path was difficult and the other simple. You would always choose the simple as it’s the same result, there’s no need to complicate matters when trading is hard enough without doing that.
10.The markets are manipulated
People will only start coming up with this phrase when they have made too many bad decisions and feel the market is to blame and not them. Forex is the most liquid market in the world, this means rigging it would be extremely difficult and very unlikely. You are safe in thinking the markets are true in their nature as long as you are using certified brokers.
Traders love to talk about trading, but it is important to define your trading talk. Successful Forex trading and crypto traders that fail in Forex Trading are because they look at the markets in a different way.