Money management

The concept of stop loss and money management cannot be stressed enough. It is very easy to makemoney in the forex market. How much you make and in what time depends on how good you are. Let meexplain how easy it can be. Any sane person can find the long term trend in a currency. Just open the daily chart and find in which way the chart is moving. If it moves up from left to right, then the trend is up. If it moves down from left to right, the trend is down. Simple. You dont need to know rocket science to find this.
Next, you need to have enough money and you need to buy lots in the direction of the trend. Assume that you have $5000 in your mini-account and you buy 1 lot which would cost you, say $50. This means that you still have $4950 for handling the situation when the buy goes against you. Assuming that you buy EURUSD, the price has to move 4950 pips for you to burn up your account and be out of the trade. And what is the chance that the price would move 4950 pips against you if you had bought it in the direction of the trend? One in a million maybe. The price may go 300-400 pips against you but it will always come back if you had bought the pair in the direction of the trend. So making money in forex is as simple as picking the direction of the trend and having enough money to sustain your losses.

As said before, how much money you make and how soon the price, after it moves against you, comes back depends on what juncture you picked up your lot. It may come back in a few hours or days or months but it will surely come back. If you had picked it up at the right point and in the right direction, it will come back sooner. If you did not pick the right moment, it will still come back but it will be later. This is why you need to know the supports and resistances and the direction of the trend. If the trend is up and you go long at a support, even if the price breaks through the support and drops, it will surely come back. You need to wait patiently.

So always have enough money in your acccount and choose the time you get in, carefully. Lots of time is still left and the market is always going to be there. So dont hurry and dont blow up your account. There have been instances when many users open a $250 mini account and buy 1 lot in the wrong direction and blow up the account in a few days time. They keep doing this 4-5 times before they start realising this. Whereas, if they had spent time to accumulate that money (4 times $250 is $1000), they could have invested $1000 in the account and chosen the right moment to get in and thus made money. $1000 gives you a much better chance of survival than having $250 in your account.
So keep it simple. Choose the direction, choose the time and go for it and make money!!