Thursday, 7 February 2013

Forex Trading Myths - Don't Believe Everything You Hear

Forex Trading Myths - Don't Believe Everything You Hear

One of the most challenging things for new Forex traders is that of finding a good, reliable Forex trading information. Having the right information can mean the difference between success and failure in the trading world. There are far too many Forex myths floating around so we would like to dispel some of them for you.
There is no slippage in Forex -- you will hear this pretty much constantly. First we'll start with a quick definition. In trading, slippage is the difference between the price you want and the price you get. Don't ever believe that there is no slippage in Forex because that is a myth. Although Forex is extremely liquid and you may get filled at your price frequently, it does not happen every single time. During times of extreme volatility, such as the days of news releases, slippage in Forex can be extremely common. We have personally seen slippage of over 100 pips and almost 200 pips! It is hoped that by dispelling the myth of there being no slippage in Forex that you will keep a close eye on your risk during periods of extreme volatility.
Technical indicators don't work -- this is another popular myth typically perpetrated by those who would love for you to believe that they have discovered some new incredible method of trading. You'll frequently hear that indicators do not work and that the only way to trade Forex is to use price action. The fact of the matter is that indicators have made billions of dollars in the global financial markets year after year after year. It does seem quite logical, however, that those who are not proficient in the use of technical indicators would not profit by using them. Improper use of any tool will result in failure to get the job done. As a leading technical analyst, Tony Hosea says, "You are always going to be disappointed when you try to drive nails by using a screwdriver".
Anyone can be a successful Forex trader -- this is probably the biggest myth of all. Successful traders are not a dime a dozen, they are a rare breed. That doesn't mean you that you can't become a successful Forex trader, it simply stating that not everyone is cut out for it. The main reason that this myth is being perpetuated is so that people who have no idea how to trade Forex will think that they can simply buy some inexpensive "solution" and fill their trading accounts with cash. This simply is not true. Anyone who enters into a Forex trading arena unprepared will get eaten alive.
These are but a few of the many Forex trading myths that are in circulation today. These are often perpetuated by those who have an agenda in order to bias beginning traders into thinking one way or another in order to eventually get them to actually believe that the myths actually are true.
Richard Davieess is an expert in the proper use of forex trading tips. Richard runs the very successful and popular website about Forex trading. He has helped people all over the world become better Forex traders. Visit his site at right now for more information and/or help on successful Forex trading.

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