Welcome to the Pip

For the uninitiated, foreign currency exchange (Forex) trading is basically the buying and selling of various forms of currency. When you buy a currency, you are hoping that the value of the currency appreciates so that you can later sell it at a higher price, and pocket the difference. When you sell the currency, you are hoping that the value will depreciate, so that you can buy it back at a lower price. This is not unlike the stock market. This website has a great introduction/tutorial to what Forex is.

I first became interested in this market about 2 years ago, and after a bit of learning on a demo account (sort of like a trial run without any money), I tried the real thing. $250 later I had a real account, and using 20:1 margin (margin is basically a multiplier that allowed my $250 to behave like $5000) I managed a 16% return in 2 weeks. And that was the beginning of the end.

2 weeks after my brush with beginner's luck, I began to have losing trades more and more frequently. I chased bad trades with more bad trades, like an alcoholic with amnesia, not remembering that if one hasty trade ended badly, the next hasty trade probably will, too.

Soon, 50% of my money was gone. I withdrew what was left, and walked away scratching my head. Whew, good thing that wasn't grocery money. So now, realizing that I was gambling more than anything else, I want to truly learn how to trade Forex so I can get my money back. And more.

To that end, I've decided a blog can only help me as I record reasons for trades (on another demo account of course), do chart analysis, and just generally ponder all things Forex.

You, dear reader, will be privy to all these thoughts.

So, as I embark on a journey to navigate the rough seas of Forex trading, let's hope that we learn a lot together, and that we don't end up drowning on the way to our destination, profitability.