A lot of South African Forex brokers do not offer the best conditions. They act as if the market is niche and they are already doing you a favour by working with you.
Luckily, some international players started to catch on and have entered the region. The best one is JustForex company – a UK-based broker with pretty tight spreads and rather reliable support. Since they are still entering the market, the level of service for South Africa is noticeably better than for the other countries. There is no guarantee that it will last, but right now they are the best.
How to choose a trading style and strategy
There is a percent of Forex traders that trade for fun; however, the majority of them are doing it for profits. Profit on Forex is more often than not connected to a lot of risks. So, to determine your trading style, you need to determine how much risk you want to take.
Basically, as a newcomer, you have two options: scalping and Price Action. There are other strategies too, but they are more advanced and require experience.
Scalping
Scalping is a highly demanding strategy that depends on making dozens — if not hundreds — of trades each day. It is also extremely risky and tends to cause a lot of emotional stress. Overall, it is the most profitable strategy, but most people can’t handle it for long periods.
Scalping is based on making a minimum profit from each trade but compensating with their overall number. The scalpers take advantage of the newly released economic reports, momentary market trends and sudden price surges. They need tight spreads — or, ideally, no spreads at all. They also need a good connection to the brokers’ servers, since even the slightest slippage in scalping can decide the profitability of the order.
If you want to try your hand in scalping, start with the “lazy river” strategy – it is slower and less profitable than the others but allows for some downtime and is easier on your psyche.
Price Action
Price Action is a slower but more systematic approach that prioritizes stability before the profit. It is based on recognizing the patterns formed by the candlesticks and moving averages, and trading by them.
Price Action traders have more downtime, as well as more time to make decisions. The downside is lower profits.
Since this is a slower strategy, Price Action traders often prioritize good leverage options and reliable analytic reports before the good connection and tighter spreads. However, if you have enough starting capital to cover the minimal trades and can analyze the market yourself, the 0-pips spreads definitely won’t hurt.
Leverage is an ability to trade with larger amounts than your investing capital allows. It increases risks but also increases the profits. Most Forex brokers offer leverage up to 1:3000.
There are dozens of Price Action patterns and even more guides. However, you can start by learning about pin-bars, inside/outside bars and false breakouts. They are more common and often are the only ones that you will see for quite a while.
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