Forex Day Trading for Beginners - Novices Beware of the Hype!

By: Kelly Price
This article is all about forex day trading for beginners and how to approach day trading on the face of it, day trading looks a great low risk form of trading that can make you a lot of money but as with all ways of making money, its not as straightforward as that...

Day traders don't make money long term, the odds are stacked against them and without the odds on your side in any form of investment- your going to lose.

What about all the forex day trading systems that claim to make money?

Well there is a problem - they have never been traded and are not all they make themselves out to be. In the small print at the bottom of the track record you will normally find the statement below or a very similar one:

"CFTC RULE 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading."


"Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown".

If you have read and understand the above, you will see that the track records have all been simulated on back data not real time data and that of course is easy.

Try and find one with a real time track record and you can get ready for a long search. The fact is forex day trading is a theory that sounds good but that's all it is - a theory which doesnt add up in practice, which appeals to greedy and naïve traders. They buy automatic day trading systems in droves and really dont think about the disclaimer or dont even read it!

Why doesn't day trading work?

It's pretty obvious if you think about the logic its based on which is about determing what millionds of traders are going to do to price in a very short time period.

You have millions of traders trading to make the price and they all have different systems, motivations, aims, skills and subject to their emotions - How can you tell what this vast diverse, mass of traders are going to do in just a few hours?

Answer -You can't!

All short term volatility i random and prices move randomly in short time periods. Support and resistance levels simply cannot be used to time trading signals and get the odds on your side.

Forex day trading is sold on the fact that it keeps losses small and yes it does however you are going to get stopped out the majority of time. This means that by placing stops to close by trying to avoid risk you are actually creating it and guaranteeing a huge amount of losses, as your stop is to close and within daily volatility ranges.

When it comes to profits (and by the law of averages you are going to get some!) what do day traders do - do they run there profits to cover their inevitable losses?

Of course they don't, they snatch or try and scalp a small profits which of course can never cover their vast amount of losses. Running profits and cutting losses, is one of the keys to successful investment and even the best trading systems are going to be stopped out the majority of the time.

If you believe the trade for "a regular income" or "make money on 70% of the trades" - then you are falling for the hype of advertising copy and that's not the real world of trading. Anyone who believes these statements really needs to continue with their forex education and get a reality check.

Day trading is one of the most popular forms of trading for novice investors and if you have read and understood the enclosed the most important fact related to forex day trading for beginners is - don't try it, unless of course you want to lose your equity!

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