The harsh reality is, learning to trade is an expensive business. I am not sure I have met anyone who, trading independently, with little capital makes a living from trading straight away.
If you are like most you will have good times, and bad times. Profitable times and costly times. It comes with the territory I am afraid.
That being said, I strongly believe you can minimise the difficult times by not rushing into elaborate trading systems with confusing expert advisors. The best way to start is to start with the basics. That doesn’t mean the basics will bring you extravagant profits but it does mean you will be able to see where your loses are coming from. You will be able to learn how price action works by seeing the action rather than looking at profit and lose sheet at the end of the day which is often all you get with an EA.
So where should you start?
Why not take 3 or 4 ‘standard’ indicators which are freely available in your MT4 platform and set some rules for entry and exit? Watch and test and repeat until you feel you can at least breakeven with the system.
Moving Average – I personally like an SMA
Parabolic SAR – Great for staying on the right side of a move
MACD – Classic indicator which has stood the test of time
Force Index – An Elder indicator which is excellent at showing momentum of a move
What should you do next?
Place them all on a single forex chart which suits the hours you can commit to be at the screen. You can use standard settings and just vary the period of your chart to keep things simple to start with. Getting caught up in the ‘settings’ of indicators is something you should only do once you have your trading philosophy clearly defined in your own mind.
Once you have the chart set up you can watch and learn from how the market moves. Initially I would say don’t take any trades unless all indicators are confirming one direction over another. As you gain more experience you may find only one or two need to confirm your trading decisions.
Remember, indicators are only filters. They are not the holy grail. By filtering out bad trades you will, by nature, filter out good trades as well. That is why keeping stops tight compared to potential profit is key.
Take some time and read some of our articles on getting started in trading which should give you some great tips to get your trading career off the ground.
Once you can get to grips with the basics on MT4 trading you will then have the knowledge to analyse more complicated systems.