Tag: trading

Forex 101: An Educational Guide for Beginners

New in the Forex market? This market may sound really complicated and scary to tackle but it’s not. Just like in any kinds of trade, you make money when you buy low and sell high. Forex trading is simply trading currencies in the Forex market.

Forex is the largest financial market in the world. It generates trillions of dollars of currency exchanges everyday and it operates 24 hours a day and seven days a week therefore, also making it the most liquid market in the world.

In the world of Forex, trading in this very liquid market is very unique compared to other financial market like stocks. Since the Forex market operates 24 hours a day worldwide, which starts at Sydney and ends in New York, trading is not centralized in one location. You can trade in Forex whenever you want regardless of the local time.

In the past, Forex trading was only offered to large financial institutions, like banks. And, it was also only offered to large companies, multi-national corporations and large currency dealers. This is because of the large and extremely strict financial requirements the Forex market imposed. This means that individual traders and small businesses are not able to participate in this liquid market.

However, in the late 90s, Forex was made available to individual traders and small businesses. This is due to the advances in the communications technology. High speed internet made it possible for people to enter the Forex market and have become one of the best make money at home businesses.

Forex trading is getting more and more popular each day. Besides, who wouldn’t want to trade in the largest and the most liquid financial market in the world? Trading in Forex will certainly give you the opportunity to earn a lot of money. However, trading in this ever liquid market also has its risk. It is a fact that many people who traded in Forex lost a substantial amount of money and some of these people are seasoned traders.

This is why it is very important for you, as a beginner trader in the Forex market, to have the proper knowledge and education on how to trade in the Forex market. Firstly, there are hundreds or even thousands of available websites in the internet that offers Forex education. Some of these websites offer dummy Forex trading where you can practice trading in the Forex market using dummy money.

These programs will really take you closer to actually trading in Forex. Many experts say that you’ll never really understand how Forex really works until you traded in the market. So, if you want to learn how to trade Forex, you may want to sign up for a dummy account that numerous Forex trading websites offer.

With a dummy account, you can trade Forex by not using real money at all. With this program you can practice your knowledge and skills in trading in the Forex market and not waste money.

To get started in trading in this market, all you need is a computer with a high speed internet connection, a funded Forex account, and a trading system. These three simple things are enough to get you started in Forex trading.

In order for you to minimize the risk of losing money, you need to have some basic knowledge in charting before you start trading. In most Forex trading systems, Forex charts are there to assist you with your trades. Forex charts are a visual representation of the exchange rates of currencies. This is where you will mostly base your decisions to buy and sell currencies. You have to learn how to read the different Forex charts in order for you to successfully trade in the Forex market.

Each Forex chart is different although they represent the same fluctuations. For example, in the daily Forex chart, you can evaluate market trends in the past 24 hours to help you make decisions on the next 24 hours of trading. In the hourly chart, you can use this chart to spot trends within the day. And, in the 15 minute chart, where it can help you recent currency fluctuations in a 15 minute interval to help you decide on which currency to buy and sell. Sometimes, there are 5 minute chart available to better help you get closer to the action.

These are the basics on how to trade in the Forex market. Always remember that aside from the promising earning potential that you can have in the Forex market, there are also underlying risks that you have to consider. It is therefore wise to trade in this market with a proper investment plan and strategy. If you are just starting out to trade in Forex, consider opening a dummy account to help you practice trading Forex without risking money.

Forex Trading – should you invest?

Forex trading is all about putting your money into other currencies, so you can gain the interest for the night, for time period or the difference in trading money all around. Forex trading does involve other assets along with money, but because you are investing in other countries and in other businesses that are dealing in other currencies the basis for the money you make or lose will be based on the trading of money.

Constant trading is done in the forex markets as time zones will vary and the markets will open in one country while another is near closing. What happens in one market will have an effect on the other countries forex markets, but it is not always bad or good, sometimes the margins of trading are near each other.

A forex market will be present when two countries are involved in trading, and when money is traded for goods, services or a combination of these things. Currency is the money that trades hands, from one to another. Often times, a bank is going to be the source of forex trading, as millions of dollars are traded daily. There is nearly two trillion dollars traded daily on the forex market. Should you get involved in forex trading? If you are already involved in the stock market, you have some idea of what forex trading really is all about.

The stock market involves buying shares of a company, and you watch how that company does, waiting for a bigger return. In the forex markets, you are purchasing items or products, or goods, and you are paying money for them. As you do this, you are gaining or losing as the currency exchange differs daily from country to country. To better prepare you for the forex markets you can learn about trading and purchasing online using free ‘game’ like software.

You will log on and create an account. Entering information about what you are interested in and what you want to do. The ‘game’ will allow you to make purchases and trades, involving different currencies, so you can then see first hand what a gain or loss will be like. As you continue on with this fake account you will see first hand how to make decisions based on what you know, which means you will have to read about the market changes or you will have to take a brokers information at value and play from there.

If you, as an individual want to be involved in forex trading, you must get involved through broker, or a financial institution. Individuals are also known as spectators, even if you are investing money because the amount of money you are investing is minimal compared to the millions of dollars that are invested by governments and by banks at any given time. This does not mean you can’t get involved. Your broker or investment advisor will be able to tell you more about how you can be involved in forex trading. In the US, there are many regulations and laws in regards to who can handle forex trading for US citizens so if you are searching the internet for a broker, be sure you read the print, and the information about where the company is located and if it is legal for you to do business with that company.

Forex Trading, Where Do Customers Go?

Forex trading uses currency and stock markets from a variety of countries to create a trading market where millions and millions are traded and exchanged daily. This market is similar to the stock market, as people buy and sell, but the market and the over all results are much much larger. Those involved in the forex trading markets include the Deutsche bank, UBS, Citigroup, and others such as HSBC, Braclays, Merrill Lynch, JP Morgan Chase, and still others such as Goldman Sachs, ABN Amro, Morgan Stanley, and so on.

To get involved in the forex trading markets, contacting any of these large broker assistance firms is going to be in your best interest. Sure, anyone can get involved in the forex market, but it does take time to learn about what is hot, what is not, and just where you should place your money at this time.

International banks are the markets biggest users on the forex markets, as they have millions of dollars to invest daily, to earn interest and this is just one method of how banks make money on the money you save in their bank. Think about the bank that you deal with all the time. Do you know if you can go there, and obtain money from ‘another’ country if you are heading out on vacation? If not, that bank is most likely not involved in forex trading. If you have to know if your bank is involved in forex trading, you can ask any manager or you can look at the financial information sheets that banks are to report to the public on a quarterly baiss.

If you are new to the forex market, it is important to realize there is no one person or one bank that controls all the trades that occur in the forex markets. Various currencies are traded, and will originate from anywhere in the world. The currencies that are most often traded in the forex markets include those of the US dollar, the Eurozone euro, the Japanese yen, the British pound sterling and the Swiss franc as well as the Australian dollar. These are just a few of the currencies that are traded on the forex markets, with many other counties currencies to be included as well. The main trading centers for the forex trading markets are located in Tokyo, New York and in London but with other smaller trading centers located thought out the world as well.

Forex Markets – Trading Internationally

Forex market trading is trading money, currencies worldwide. Most all countries around the world are involved in the forex trading market, where money is bought and sold, based on the value of that currency at the time. As some currencies are not worth much, it is not going to be traded heavily, as the currency is worth more, additional brokers and bankers are going to choose to invest in that market at that time.

Forex trading does take place daily, where almost two trillion dollars are moved every day – that is a huge amount of money. Think about how many millions it does take to bring about a total of a trillion and then consider that this is done on a daily basis – if you want to get involved in where the money is, forex trading is one ‘setting’ where money is exchanging hands daily.

The currencies that are traded on the forex markets are going to be those from every country around the world. Every currency has it own three-letter symbol that will represent that country and the currency that is being traded. For example, the Japanese yen is the JPY and the United Stated dollar is USD. The British pound is the GBP and the Euro is the EUR. You can trade within many currencies in one day, or you can trade to a different currency every day. Most all trades through a broker, or those any company are going to require some type of fee so you want to be sure about the trade you are making before making too many trades which are going to involve many fees.

Trades between markets and countries are going to happen every day. Some of the most heavily trades occur between the Euro and the US dollar, and then the US dollar and the Japanese yen, and then of the other most often seen trades is between the British pound and the US dollar. The trades happen all day, all night, and thought out various markets. As one country opens trading for the day another is closing. The time zones across the world affect how the trading takes place and when the markets are open.

When you are making a transaction from one market to another, involving one currency to another you will notice the symbols are used to explain the transactions. All transactions are going to look something like this EURzzz/USDzzz the zzz is to represent the percentages of trading for the percentage of the transaction. Other instances could look like this AUSzzz/USD and so on. When reading and reviewing your forex statements and online information you will understand it all much better if you are to remember these symbols of the currencies that are involved.

Automated Forex Trading: Clever Yet Effective Technology

Why Forex trading?

This is probably one of the questions that you need a reasonable answer. There are hundreds of investments out there that you can prefer, but why go trading foreign currencies instead?

Forex investment is unique in various aspects.

* Its trading volume is relatively huge compared to other market.
* It has extreme liquidity or the capability of either buying or selling the currency without causing significant movement in the market price.
* It has the largest number and variety of traders.
* It is one of the markets that have long trading hours (24 hours each day, except during weekends.
* Trading locations are almost everywhere, not just in the United States or major cities of Europe.
* There are different factors that affect foreign exchange rate.

Another whooping fact that will make you excited to go on Forex trading: it has an average turnover in traditional foreign exchange market of around $1.88 trillion daily, according to the Triennial Central Bank Survey of the BIS (Bank for International Settlements). Here are the daily averages of turnover on the Forex market for the last 17 years:

* $500 billion (April 1989)
* $750 billion (April 1992)
* $1.18 trillion (April 1995)
* $1.48 trillion (April 1998)
* $1.16 trillion (April 2001)
* $1.88 trillion (April 2004)

From the figures alone, you will notice that the average trend of Forex turnover is increasing. It is estimated to reach as high as 2 to 3 trillion dollars within the next 8 to 10 years, if the number of traders around the world will continue to increase. As a matter of fact, everyone have the chance of getting a substantial slice of the Forex market wealth pie, especially that the Forex trading marketing is now on its automation process.

The concept of automation becomes the new trend to the foreign exchange trading market. The Interbank spot Forex market has also considered switching to the automated method as well.

There are several benefits that a Forex trader can derive from automated Forex trading. Here are some of such benefits and figure out why Forex trading as well as other investments (futures and commodities) prefer the automated process.

* Through automated process, transactions can now be done in real time. Although manual systems have existed for quite some time now, it is difficult to achieve such benefit that the automated Forex system can offer to its traders. All of the trades can happen within a few milliseconds and can be a big plus for automated transactions against the manual system. In fact, there are problems that are addressed using automated Forex trading especially if the trader is losing a few times in a row that prevents him from making new trades. Such problem could be addressed using the automatic trading system.

* With automated Forex trading, you will have a greater diversification. It means that you can trade in various markets in different time zones at a time. You can execute trades with traders from Singapore or London even it is already 12 midnight in the United States. This benefit allows you a multiple exchange model option. You can use varying trading models to evaluate short-term data. This means that you will be able to predict the trend for a shorter period of time, let us say from fifteen minutes to half an hour.

* As previously mentioned, the Forex market is unique because of its extreme liquidity. This liquidity is increased when the market goes automated.

* Risk management problems are solved through automated Forex trading. International checks, which are commonly used in making purchases on Forex market, are synchronized through automated technology. Since the transaction in an automated process is now on real time, there is a slim chance that the payments will be delayed, reducing the risk of non-payment by either parties. Although there are problems noted with the use of the automated system, it can be fixed through consistently-updated technologies.

With automated Forex trading market, the prediction of $2-3 trillion average daily turnover within the nest 8 to 10 years can be changed within the next 4 to 5 years. Given the quick yet efficient trades on varying time zones, automated Forex trading will now be among the existing lucrative business around the world.

Essential Tips on How to Learn Forex Trading

Many people who have decided to enter the forex trading should educate themselves first. It is very important to know even the basics of forex trading to gain success, but this is no guarantee, not by a long shot, you need to know more than the basics to even have a fighting chance of succeeding. There are different ways to learn forex trading. You can join online services, enroll in a forex trading school, become an apprentice of a forex trader, or do it alone. However, doing it alone involves a lot of risks especially for beginners.

For novice traders, it is much better to choose the safer ways of learning forex trading. You are going to benefit from experienced instructors who are already trading forex in real times. In this manner, you are being acquainted with the real market conditions. You are given the chance to see the actual processes and decisions which you can later on adopt. Nevertheless, it is your own strategy that will win you up.

There are six simple steps that novice traders can follow to achieve success in the forex markets.

1. Right attitude. The traders who are successful in trading forex takes on the attitude of doing what it takes to achieve success. This stresses that success lies on the person who are trading forex itself. It does not matter if you read forex trading tip sheets or listen to forex trading guru. It will become invalid if you don’t possess the right attitude for success.

You can conduct experiments on your own for two weeks together with other novice traders. They are often called as turtles. Learning forex trading is avoiding the trap of believing that you can actually gain success by following someone else. Just get the right knowledge and develop a strategy of your own.

2. Right method. It should involve long term trends. Keep in mind that the trend on big currencies lasts for months or even for years. It is your responsibility to lock yourself into these trends to make huge profits. It is best suggested to use the breakout methods to catch long-term trends. This method is already proven by leading trading systems. Good software is also recommended for use. It allows the trader to test the trading method that was chosen and later on trade it on real times.

You need to know proper charting and mapping. There is already available software that will aid you regarding market moves. It will allow you to calculate the best times for selling or buying when you are able to read forex market charts.

3. Right discipline. The traders should discipline themselves by strictly following on their developed methods even when losing period’s strikes. It could teach them new techniques on how to survive the forex markets even when downfalls strike.

4. Right knowledge. The traders can quickly learn the breakout method, however, they should also overcome psychological pitfalls involved in forex trading. It is recommended to read motivational books that mainly focus on this matter.

5. Take the risks. The common mistake done by most forex traders is trying to restrict the risks. In the end they may suffer great losses because they are being blocked out in the forex market. The trader’s direction is right however the trade does not have enough room for downsides. Always remember that in forex trading risks lays the rewards. There is a difference between rushing in taking risks which are already calculated. It only allows you to wait for the right opportunity.

6. Trading in isolation. The trader should learn this to keep focused. Remember that if you are open to the views and opinions of others, it may discourage you if you find it very different. It does not necessarily mean you follow the opinion agreed upon by many traders, because most often, many traders acquire losses.

Forex market is considered the largest market in the world. It is operational twenty four hours a day, five days a week. Its processes are been carried out in real times without boundaries. The trader’s success also depends on the right decision making. Learning forex trading have no barriers and entry points so you need to have better understanding before plunging into business. Although some people suggest that learning forex while trading is the best, but it is always your decision to choose the best way to learn that will suit your needs.

Trading Forex Right In The Comforts Of Your Own Home

Trading in financial institutions is one of the best ways to earn money. It is also one of the most promising career choices that people make today. With the opportunity to earn a lot of money, more and more people who are interested in trading in the financial institution have left their jobs to get a piece of the action in the financial market.

Today, the Forex market is the best choice for people who are considering making a career out of trading in the financial market. Besides, who wouldn’t want to trade in the largest and the most liquid market in the planet which involves all the countries in the world?

The Forex market operates 24 hours a day with currency exchanges that can go as high as 2 trillion dollars each trading day. Also, it is the most liquid market in the world which also means that traders can enter the market anytime they want and get their profits easily.

In the past, Forex was limited to large financial institutions and multinational companies. Only banks, central banks and large companies were allowed to participate in the Forex market. However, thanks to modern communications technology and high speed internet and decreased sanctions in the Forex market, ordinary people can now trade and participate in the world’s largest financial market.

Because the Forex market is now open to everyone and because it is a very profitable industry, online Forex brokerage firms began improving their services and accessibility. They now also designed different trading platforms suitable for different Forex traders. Not only has online Forex brokerage firms made their trading platforms accessible, they also began and still continuing to improve their software.

They also allow people to register with a Mini Forex account that can let them trade with a minimum margin of 100 dollars only or even less.

If you are interested in joining the Forex market, you only have to have a few things to get you started.

First, you need a computer with a high-speed internet connection. The high-speed internet connection is very important for an effective trade to work. It will also minimize the risk of slippages that can cause you to lose money. So, if your area doesn’t have any high-speed internet connection available, you should forget about trading in the Forex market online. This will only make you lose a lot of money.

Second, you need to choose which Forex brokerage company you should hire. These companies will provide you with the Forex trading platform that you can easily download and install in your computer. The Forex trading platform is simply a software program that is essential for an online Forex trader.

It is important for you to choose a trading platform that you are comfortable using. You should also make sure that the trading platform you choose provides accurate and up to date real time information, security, and stability.

It is also recommended that the trading platform you choose should provide information on at least 16 currency pairs, execute orders with just a click of the mouse, have charting tools to perform technical analysis, and should also have a recording feature that will store your trading history.

With all these features, you can really improve the way you trade in the Forex market and also minimize the risk of losing money.

Look for a Forex trading platform that is simple to use and easy to understand. If you wish to know more about the Forex trading platform that a Forex trading brokerage firm offers, you can consider opening a dummy or practice account. By doing this, you will never risk real money on trades while learning the ropes.

You will also get hands on experience on the Forex trading platform and really determine if the platform is for you or not.

Risk management is also a very important feature that you should look for. If it takes too long to select a risk management order, you should consider looking for another Forex trading platform.

These are some of the things you should look for in a Forex trading platform. With a little practice in the dummy account, you can be sure that you can get the hang of it in no time at all and start making money through online Forex trading with a reliable Forex trading platform.