The Forex trader is an artisan of sorts. He must craft a series of trades using the tools at his disposal to build a profitable masterpiece. This process is no easier than painting a beautiful landscape or sculpting a human figure. Nor does this process require any less skill or are the tools used any less important than those required of a world renowned architect.
I have discussed in previous articles the skills that must be acquired by the Forex trader in order to be successful over the long-term. In this article I turn to the tools used by successful Forex traders all over the world. I will avoid disclosing the companies that make any specific tool so as not to turn this into an advertisement for some.
1) Your Brain - Sounds cliché but it is true. Your brain is your number one tool. You must continually fill it with new ideas that can help you improve your Forex Trading. You must educate it so as to recall points even in the heat of the trade. You must trust it when it tells you to do something even when your emotions disagree.
2) Research Materials - What does this mean? Research materials may include everything from the first lesson you took on Forex and the concepts you learned there to the piece you read this morning from your favorite economic analyst. Read EVERYTHING you can to help you improve. Keep them well organized and easily accessible for when you want to consult them. Get access to news articles, market analysis, Cot reports, Forex Lessons, Forex tips, etc.
3) Forex Mentor - For the novice and intermediate Forex trader, having a mentor is crucial. This person may be someone you interact with personally or may be a Forex author you read and follow. You may join a Trade Room and interact with other Forex traders finding a mentor their. Having someone to emulate will help you. Don't become this person - but learn from his/her strengths and weaknesses and improve on them.
4) Forex Trading Platform - Find a platform you like and learn it forwards and backwards. Practice it as you would a musical instrument and come to feel totally comfortable with it's interface and commands. There are many platforms available in the Forex world, some exclusive to one broker or another. Make sure to research the brokers that use a particular platform and be sure you are as comfortable with the broker's business practices as you are with their platform.
5) Trading Indicators - Your trading indicators may be mathematical algorithms that forecast what a currency may do next or specific events that ,when they occur, indicate a trade action. Study the many indicators available and narrow them down to a few that you feel most comfortable with.
6) Forex Trading System - Next to a trader's brain, this is the most important tool in the Trader's arsenal. In fact, you could consider the Trading System to be the brain of the trade itself. The rules of the system determine the actions taken by the trader. Some traders use a system with strict rules that they never vary from. Other traders trade with the philosophy that rules of a trading system were "meant to be broken". The type of trading system a Forex trader settles in with depends on the trading personality, discipline, and style of the trader him/herself.
