I was no different than anybody else when I first started trading the forex market. I used a demo account. It's only natural that you walk before you can run. However, I think many people get up to actually run. Many new traders can't get past the "demo" mindset.
It's kind of like a little kid who is using training wheels on their bike. It's fine in the beginning, but can you really call yourself a "bike rider" if you never take off the training wheels. Eventually you have to take the plunge and have confidence in your own skills to do it for real. When it comes to trading, many traders never actually get that confidence.
You can look around forex forums all day long and see people showing how much money they have made on their demo accounts, but guess what? Your local bank probably won't accept "demo" money. It's a whole different scenario when the rubber meets the road, and they end up crashing their accounts. Why do you think that happens? It's simple... you don't know how to handle the emotions of trading for real.
Because demos are meant for traders who just want to learn about trading, it doesn't really make a difference if you have losing trades. Obviously, it's nice to have more wins than losses, but the bottom line is it doesn't matter.
The only thing that matters is the bottom line, and you cannot simulate the kind of emotions that are involved with trading with real money on a demo... no matter how hard you try.
If I could compare it to something it would probably like somebody giving you a million dollars to take to Las Vegas to gamble with. They tell you that you can keep any of the profits. What are you going to do? You are going to act like that million dollars doesn't belong to you, and you are going to be very carefree about how you use it.
If you are not trading with your own money on a live account, then you really can't call yourself a trader, can you? When a trade goes against you for a couple hundred pips on a demo, it doesn't matter to you. You'll just get the next one. It's not the same when those are real dollars going against you.
Only trade on a demo until you feel comfortable. After that happens start trading for real.
The key to trading the forex market comes down to price action.
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