Non-technical analysis

Non-technical analysis is the analysis of yourself, your emotions and your mental capacity. Many new traders underestimate the power of their own emotions.

They are unprepared for the powerful forces from their own psychology that come into play when they start trading. The power of fear and greed will overwhelm and conquer you into ruins if you don't know how to control them.
Practicing on a forex demo will keep you from letting those emotions take over by at least making you aware of them. It will also help you practice managing your emotions during a real life trade.
Believe me, your emotions won't go as wild as it will when you start trading with real money, but if you practice, you will get a sense of it and have an idea of how you will react and how you should respond to those emotions.
Some new traders overestimate their own mental capacity. They end up using complicated forex trading strategies and systems that are beyond their mental capacity.
Big mistake because in real life trading, you have to have full control of your mind. If you find that the variables and data you're working with in your forex trading system, you should consider simplifying it so that you have a handle on it when the time comes.
I just came from a forex blog that is written by a guy that graduated from MIT. He had complicated financial data that he processed to give him his trading plan for the day.
The only problem for me was that I had no idea what he was talking about. I'm sure it was a sensible plan, but I didn't understand it, so I'm not going to use it.
Warren Buffet saved himself from the tech bubble of the late 1990's because he has a philosophy of not investing in something he doesn't understand. He didn't get why the technology sector stock values were so inflated and why, even though the price was so disproportional to the earnings (PE Ratio), investors kept buying the stocks.
It didn't make sense to Buffet and he stayed out on the most part. Trade what you know and trade in a system that you know backward and forward because when the inevitable surprises come your way, you know how to strategically respond within your trading system.
Trading on a forex demo account will help you know your limits as well as your strengths. It will help you find out what you really know.