With
a Demo-Account, you can experience the same market action and go
through the same process of making decisions based on breaking news,
reacting to charting patterns, and tracking ones performance the same
way professional Forex traders do every day.
Yes, it’s true, you can trade the forex markets for free and using the
same state-of-the-art software packages that professional Forex
traders, around the world, are currently using to make real-time, live
currency trades.
And you can also experience the same dynamic market action and go
through the same process of making decisions based on breaking news,
reacting to charting patterns, and tracking ones performance the same
way professional Forex traders do.
And all this can be done even if you don't put any real money into your
account, you won’t see any difference in how the market behaves and how
you react to the market. In short, at some point, every new forex
trader needs to start Demo-trading.
Once you start placing demo trades, you will learn a lot about how
Forex transactions are placed. I can’t emphasize you enough, that this
is a very important step for you in order to be able to learn how to
become a trader. A demo account allows one to become familiar with
trading procedures, such as placing Market, Limit, Stop, OCO Orders
without any risk. All dollar losses or gains on a demo account are
imaginary but, as mentioned above, the trading experience you acquire
is not.
You should notice that making big gains in a demo-account does not
guarantee profits in live trading; however, those who are not
successful trading on paper rarely are successful when money is on the
line. So, yes, just playing around and getting familiar with a demo
account can be a great learning experience; however, you will not learn
how to become a trader this way. You need to have a trading strategy.
Once you sign up for a mini-demo account, you will need to try one of
the trial charting packages from the broker you choose. Any demo
software you choose will do because they all have the necessary
indicator tools you need. Once you have downloaded the software you can
then set up your demo account and start drawing trendlines, marking
support & resistance levels, monitoring moving averages, etc. This
is also a very good way to get used to how orders are placed. Once you
have a real trading system, you will already know how to place orders
properly.
And remember, everyone makes mistakes placing orders. So you need to
experiment before in a demo account so you can make your mistakes
without losing any real money.
