Essential Forex Trading Guide

Trading in the Forex market can be a complicated and difficult task if you don't know where to start or what type of information to consume. There is an enormous amount of information available on the internet and even more people that want you to spend your hard-earned money on their courses, systems, signals, algos or any other number of trading related schemes. What we have done in this Wiki is break down the essential skills and information you will need to build a solid foundation as a Forex trader.

We have gone to great lengths to put this information together which was developed and written by actual full-time Forex traders with decades of experience. It is our hope that, with this information, we can bridge the gap between the big banks and retail traders to help put more money in the pockets of retail Forex traders and less in the coffers of the big banks.

Just a reminder: This Wiki is intended for educational purposes only and is not intended as financial advice. Consult your financial advisor should you have questions about your finances.

The 6 Essential Elements

Understanding these 6 key elements will help form the structure of your learning and understanding of how the Forex market works and why price moves the way it does. Trading is a business just like any other with many moving parts. After you have a solid understanding of these 6 concepts the next thing you need to do is define your trading strategies based on what makes the most sense to you and your situation.

Fundamental Analysis

The process of identifying and understanding the "factual reasons" why the market is moving in the direction that it is currently moving. Fundamental Analysis is forward-looking and allows you to use current information to try and predict where prices might go in the near future — an extremely underserved subject when it comes to retail traders.

Sentiment Analysis

The Mood of the market right now. Sentiment can change quickly and for a variety of reasons — lasting seconds, minutes, hours, days or even weeks. It is often shorter in duration than the fundamental trend.

Risk Management

Without sound Risk Management, every other skill you develop becomes irrelevant. This section covers how to protect your capital, structure your trading business, and build the defences that keep you in the game long enough to succeed.

Trading Psychology

Once you have the correct skills, your inner game becomes the deciding factor. This section covers how to get into the zone, build conviction, manage your emotional states, and develop the mental habits that separate consistently profitable traders from everyone else.

Price Action Analysis

Price Action bridges the gap between what the fundamentals and sentiment are telling you and what you actually see on the chart. This section covers how to read market structure, identify trends, and understand the mechanics behind price movement.

Technical Analysis

A method of analyzing a price chart using past charting data and technical indicators. Best used as a timing tool to aid in well thought out Fundamental Analysis, Sentiment Analysis, Price Action Analysis and Trading Psychology.

Central Banks and Economics

Central Banks are the most powerful force in the Forex market. Understanding how they operate, what tools they use, and how economic data influences their decisions is critical.

Central Banks

Economic Data and Cycles

Developing as a Trader

Your trading process will be unique to you. However, there are common themes universal to all successful traders.

Developing your Trading Process
Trading Tools
Trading Routine
Trader Types — Position Trading, Day Trading, and Scalping

When to Trade

Not all times of the day or week are created equal. Understanding the rhythm of the Forex market is essential.

Forex Market Hours — Summer hours, winter hours, and daylight savings
Forex Trading Sessions — Asia Pacific, London, and New York sessions
Best and Worst Times to Trade

Trading Strategies

Fundamental and Sentiment Strategies

Many retail traders who discover these types of strategies will tell you that this is when they had their "Breakthrough" from being an inconsistent breakeven trader to becoming a consistently profitable trader.

Technical Trading Strategies

Technical Trading Strategies are best used as a timing tool with the prevailing Fundamental and/or Sentiment trend.

Before You Trade

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