$10 Challenge – Week 1 Update
Starting small -November $10 challenge
When trading Forex remember that it is a game of wits, strategy and most of all psychology. If you are not confident in your entry you can expect rough afternoons and sleepless nights.
The idea behind the challenge is to show any trader that regardless of your account size, you can make a move on the market. With the correct strategy and confidence, you can grow an account of any size.
We put together a list of things to keep in mind when starting with a small account:
- Risk Management is key
One of the key factors of Forex, no matter the size of your account. Remember that the larger accounts can withstand a bigger drawdown as it has a sizable margin. Also, keep in mind that steady growth is better than no gains at all. Know when to place your trade, and more importantly, know when to get out.
- Understand your strategy
Demo trading your strategy is crucial when starting or testing your theory. When you apply your strategy during demo trading, you practice without the risk to blow your account. It is full-proof and vital to the process.
Once you trade the live market, the “testing” continues with a smaller account. It is easy to trade a demo account and not feel a thing when you lose. Things make a change when you trade live funds. The small account brings with it the risk of loss. The winnings, regardless of account size, brings confidence and an increased account balance. It is a great way to start your trading journey or test your strategy.
- Building confidence
Confidence comes with the knowledge you draw on to make your decisions. You cannot get past the screen time and losses – unfortunately. With a small account, you gain confidence when you learn to understand and read the market conditions. With a small account size, it is best to confirm your entries as you cannot afford to lose money on poor quality setups. The account gives you the pressure that you need to trade like a pro without the large losses or related responsibilities.
Once you have the confidence and the knowledge you can flip any size account into something substantial.
All these are great tips and a good way to get you started, but remember that you need to put in the work. This challenge is not just for those that cannot afford a large account but is also a call to everyone to test their skill on such a small margin.
Lessons Learnt in Week 1:
Trading a small account is difficult
With a tiny margin, the entries need to be precise. Should anything appear not to be headed in your direction it is best to leave the setup and retry. The moral of the story is to cut your losses and try again rather than blow the account.
Take the profits
Once your trade is in a decent profit, it is best to bank your cash. Remember that the market can retrace at any moment taking your wins with it. With a small account, the lesson is to bank what you can and enter again once the conditions are favourable.
Keep an eye
Again we repeat, You Have A Small Margin. It is crucial to a small account. The lot sizes are part of your risk management and decrease in size with each loss. Keep an eye on your balance and your trades. Make the decisions to leave an entry based on the ability to trade long term and not to grow your account overnight. Remember that ALL wins add to your account, even the little ones.
Trade your way
Everyone has something to say, but not everything you hear will work for you. Every strategy is not for everyone; it’s important to focus on what works for you. When trading remember that the market will not ask for your forgiveness or return your cash because you were not ready- stay true to what you know works.
Week 1 progress – 02- 06 November 2020
Start capital – $10.00
End Capital – $6.85
For further updates on the challenge, check out our social media.