.Many times traders are entering a position because of boredom or just to feel excitement of being long or short

This is a recipe for disaster! You should always buy or sell any pair on a reason that makes sense to you. Whether this reason is fundamental or technical or both, always make sure there is a reason.

I strongly believe that is the best to concentrate on some (not all) major pairs (such as EURUSD, GBPUSD and USDJPY) and don’t waste time with illiquid, choppy pairs.

You also have to determine when you will trade and how often you will trade. Are you going to be a day trader or hold positions for a longer period of time? Your schedule and responsibilities may have some impact on that.

You also have to determine when you will trade and how often you will trade. Are you going to be a day trader or hold positions for a longer period of time? Your schedule and responsibilities may have some impact on that.

Should you trade before economic news releases or after? You should trade heavily on night, during UK open and close etc?

It is important to define the basic ideas to begin to form some consistency and discipline.

Try to place your take profit and stop loss before entering the trade as you can always change that, if something important happens in the markets in the meantime. Most traders tend to take their profits early while letting their losses run. This is because in the in experienced traders mindset is very difficult to accept that he/she is wrong.

Placing your stop loss at the time you open a trade will help you create discipline and learn that sometimes you will be wrong. Furthermore, most new traders have completely unrealistic goals. Making big returns in the first year of trading is possible but highly improbable.

These unrealistic expectations wipe out a lot of traders before they even had the chance to learn the market. Breaking even in the first year is admirable goal; many traders do not do that. If a trader makes 20-30% on their initial investment in their first year, that is outstanding.

Money management is probably the most important aspect of trading.

First you have to accept that in trading nobody can have a 100% winning ratio and everybody (even the most experienced traders) you are sometimes wrong. Accepting that sometimes you might be wrong is again of paramount importance. The key here is accepting you are wrong before your mistake becomes too big. To do that you need to determine how much equity you have to fund your account. Then you must determine how much risk you are willing to take on each trade. Most experienced traders risk 1-4% of their account balance on each trade. This may look too low to the new forex traders, nut will definitely help you avoid big losses, create necessary discipline and keep you in the market in order to get the necessary experience. Also very important is to have a positive percentage of winning trades compared to lose trades and a positive average profit compared to the average loss ratio. If your average loss is two times your average loss is two times your average profit that means you need to make 10 profitable trades to cover 5 losing trades. Keep this in mind.