All roads lead to Rome, all financial roads lead to Forex – the global currency market. The daily turnover of this giant liquid market can amaze anyone – it is around $5.1 trillion. To compare, the United States manages to make just $280 billion – 18 times less. The official name of this structure is Foreign exchange currency market. However, traders all over the world prefer the Forex or simply FX abbreviations.
Business hours here do not stop, however, there are two days off work (bring that into notion as many indicators and tools that you may use in future for trading use other timeframes when creating statistics so you will have to adjust their settings!).
This market is decentralizes, however, there are several locations around the world where the most important international trades took place. The reasons for such place diversity is extremely simple: these cities are situated in different time zones so when in one city the working hours are ended, the other greets a new working day – and that is why this market is active on the loop.
One of the distinctive features why Forex differs from all other marketplaces like New York Stock Exchange is that all operations are processed electronically (so called over-the-counter, so the traders use computer networks).
The reason of creation of Forex is quite obvious: almost every country in the world has its own currency and all international negotiations should be conducted taking into consideration the price of one currency in comparison with the other. The need to trade currencies called for foundation of such place like Forex, where banks, organizations and individuals received a possibility to exchange currencies.
Why is it essential to learn Forex?
One of the biggest and yet the most common mistakes all newbie traders make is entering the market without a notion how all this works and what are the consequences of these or those actions performed online. It is impossible to enter a trade, buy a EURUSD currency pair by guess work and expect to get unbelievably high profit – trading is always a risk because within a minute something may happen, that can be predicted only by thorough analysis of all indicator signals, careful examination of charts, tendencies and trends – and those who is knowledgeable and prepared will gain, and others will lose.
Put it bluntly, Forex trading is all about speculation on the difference of prices of two currencies. It opens a freedom to act and a wide range of possibilities to traders of every stripe and color – but not all are able to cope with the amount of pressure, information and pace of trades.
Trading is challenging, right. In order to achieve your targets, you will have to develop different abilities and sharpen skills like discipline, confidence, commitment, flexibility in strategies and different conditions, patience to wat for the most appropriate settings, ability to take a closer look to the market and look at the big picture and take an advantage of cutting edge technologies aimed to simplify your work as a trader. And, perhaps, the most crucial demand to any trader is to know the exact amount of money you are risking when entering the trade and to calmly accept the possibility of losing that sum. No one’s perfect, there are no tools that give completely accurate information, statistics and prognosis so you have to be prepared for possible losses.
Participants of the process:
Why is it beneficial to learn Forex market?
Knowledgeable approach to the operations completed within this marketplace open a lot of opportunities for a trader. It is the place where one can learn, earn and succeed:
But, once again, it is not a game, and you risk your money. Focusing on the profit without protection and knowledge where to exit the trade is a clear path to losing all money on your account.
The best way to learn forex market trading
Before getting acquainted with the ways of sources that can help you to polish your skills and abilities, deepen knowledge and allow you to get hand on trading, ask yourself: Are you sure that you want to be a trader? Trust us, there are many other, more stress-free and easier ways to earn money. There is a saying: “The best way to end up with $1000 in forex is to start with $2000” and that’s the sad truth about more than 70% of accounts of retail traders on Forex. Only passionate, obsessed, disciplined and hard-working people can succeed in trading as is a very demanding job.
But if you are confident in your wish to become the better trader, then here are some ways that will boost your chance to learn to trade Forex.
Bring into notice that there are plenty of courses, sites, videos, instructions and tutorials explaining ins and outs of Forex. There are loads of paid sources, however, do not be tempted to spend your hard-earned dollars for the information that may not be useful for you. Browsing through the Internet you may find many free sources with great in-depth content that may be as useful as paid one.
Still, bookish knowledge cannot replace hands-on experience: practice makes perfect, as they say. However, creating an account and spending $250 just to practice sounds as not very clever idea. Still, there is a possibility to become a skilled hand: create a demo account on this marketplace. It is your chance to get acquainted with the basics of the mechanics of the trade and to get used to the trading platform you choose to work with.
Demo account is good, however, when you gain some practical experience the main advantage of demo becomes its main disadvantage: the only possibility to currency forex learn online trading is to experience what is it like to risk your own money.
Micro trading account allows you to make small trades: thus you have a possibility to train with real trades but in case if you lose, the damage will be minimal. It is a diagram worth a thousand words – no lectures or guidelines can replace your own experience.
This approach gives you a clear notion that it is essential to know what you are trading. There are many situations where novice traders enter the market buying up everything that moves and then try to trade in different directions trying to catch the profit. Such method leads to nowhere. Monitoring the situation on the market, studying of the economic news, careful examination of indicators and charts, on the contrary, give you a big picture of the trend and you are able to make correct trading decisions.
Part-time trading is less demanding than a day trading, however, there is still a need to learn forex trading if you want to add some finances to your income. Here are some tips and advices that soon you will be able to apply on practice:
When you are just learning, it would be advisable to select the U.S. dollar currency against any other foreign currency, for example, Japanese yen or British pound, it’s up to you. Even experienced traders prefer dollars, let alone beginners. There is always a possibility to become an expert in unusual pairs, of course, however, experts prompt part-timers to focus on dollar-euro pair, because it is the most frequent trade on the market.
Bring into notice that it is preferable to trade when the market of the chosen currency pairs is the most active – thus you get more chances to sell your positions.
Besides, it is one of the reasons of the appearance of the conventional image of trader’s lazy life. Programs, tools and platforms designed to analyze, notify and even make trading decisions are considered to be the best solution for newbie traders as they do not require additional knowledge or skills. They may come in handy when you just start learning your trading ways, however, with an experience and attains traders shift to more hands-on tools and software rather than continue to use automated programs.
If you check the situation on the market with opened trades and see the materialized profit – take it. Do not leave it unattended hoping to get more out of the trade, because there is a pretty good chance that you will lose everything while you have no possibility to fill the order at the anticipated price.
All in all, the main ticket to success is in trading is constant learning – never stop educational process, always search for new ways of obtaining and analyzing information, develop, polish skills and deepen knowledge – preservance wins!