A A
RSS

How to trade forex

Fri, Aug 15, 2008

Forex Tutorials

If you have read or otherwise been told that it is easy to get started in forex trading, you have not been misinformed. It is very easy to get started trading forex, and for that reason alone, you would be well advised to give serious thought to why it’s so easy for any member of the general public to get started trading forex if forex trading is not suitable for most members of the general public.

Failing to understand that online forex brokers want your money badly enough to make it as easy as possible for you to get into something that the National Futures Association warns is not suitable for “most” members of the general public could cost you greatly.

You see, the truth is, forex trading is easy. You just click a button to buy or sell a currency, then you sit back and wait to take your profit.

What is not so easy about forex trading is making money; and that is the reason you want to trade forex isn’t it? You are lured by the promises of being able to make money just by clicking a button, and being able to do this at any time of the day or night; but you should remember always that there really is no such thing as easy money. Forex trading is great when you are making money doing it. Otherwise forex trading can wipe you out of thousands fast.

That being said, the steps to take in order to begin trading forex are pretty straight forward:

  1. Find a broker that you feel secure trusting with your deposit money
  2. Fill out and submit the broker’s applications
  3. Make your initial deposit after they process your application and accept you
  4. Begin trading

We all like things to be as effortless as possible; and it’s a good thing that the foreign exchange market is so easily accessible to anyone who wants to dabble in currency trading. The problem is, currency trading isn’t something you “dabble” in. Currency trading is serious business.

Think about it: the forex market is the playground of the biggest investment banking firms in the world. Do you really think you can take on the biggest investment banking firms in the world with $300?

So while it may be easy to get started in forex trading, if you don’t actually know how to trade forex, you are probably setting yourself up to be swallowed in a single gulp, especially if you start your account with a $300 deposit. Having the necessary tools to trade forex (i.e a computer, an Internet connection and an account with an online forex broker) doesn’t cover everything you need to trade forex successfully. You actually need to know how to trade forex in order to have a chance of succeeding in currency trading; and that doesn’t mean knowing how to use the trading platform that your broker provides. You need to know how to use the trading platform, naturally, but clicking a button to buy or sell a currency without having any knowledge of the fundamentally or technically based reasoning behind your choice to buy or sell at the particular point of opening your trade will soon prove to be your downfall. Forex trading is not about tossing a coin and hoping it lands on heads.

Tags: ,

Leave a Reply

You must be logged in to post a comment.

Asides

  • Wondering if online forex trading is genuine? The answer is yes, online forex trading is genuine. However, not all forex brokers are reputable. Online forex brokers who operate dealing desk operations should usually be avoided as they are believed to make their money by trading against you so you are pretty much guaranteed to lose your money. Look for brokers who run no dealing desk operations or a forex Electronic Communications Network otherwise known as an ECN.  The reason more everyday individual forex traders use a retail forex broker instead of trading via an ECN which is regarded the most ideal way to trade forex online, is that retail brokers usually have smaller minimum balances and many new traders can only afford a small initial deposit.

  • If you are new to forex trading and wondering what is a forex trading account and how to get one, a forex trading account is an account that you apply for with an online retail forex broker. Your account allows you to trade forex online at any time of day or night from Sunday at 5:00PM EST to Friday at 4:00PM EST.

    You will usually have to fill out an application and submit evidence of your identification to obtain an account with any reputable forex broker. Your application will be reviewed and once accepted you will then have to fund your account in order to begin trading forex. Different brokers have different limits on the amount that you need in order to establish a live account forex trading.

  • FX is just another term for forex and fx online trading refers to forex trading conducted via the Internet. The Internet has made forex trading accessible to the masses. Once upon a time  the fx trading market was restricted to participants trading on the interbank level and other well-financed players. Today, every day indivuduals are trading forex via one or another online forex trading platform thanks to the services provided by retail forex brokers.

  • Day Trading is an investing term. It refers to the act of buying and selling financial instruments within the same trading day, which means your trade does not carry over into another trading day. You open and close positions all in the same trading day.

    Forex is a short form of foreign exchange and foreign exchange refers to the financial market wherein currencies are exchanged or traded.

    Currency when referenced in the context of day trading forex refers to the money of one country that gets exchanged or traded for the money of another country.

  • Don’t expect to be able to predict what’s going to happen in the forex market. The forex market is unpredictable. Just when you think you have the market figured out, it does the exact opposite of what you expect it to do based on your previously drawn conclusions.

  • When you consider that even professional forex traders lose money it should give you a good enough idea that forex trading is not Math or Science. There isn’t a formula that  will yield profit 100% of the time like adding 1 + 1 must yield 2 100% of the time.

  • Some forex analysts recently forecast that that euro would be trading at 1.45 USD within a few months and if things continue on their current path these analysts will have projected accurately. The EURUSD rate is currently fluctuating between a day low of 1.4697 and a day high of 1.4828 August 13th, 2008.

  • The US dollar is starting to let up a bit, and analysts expect the majors to do some climbing back after dropping significantly against the USD over the last couple of weeks; however the expectation is for the majors to drop again.

    Get some trading ideas from expert strategists who are following the USD currency trading drama.
    Forex Market Prepares For Dollar Strength Correction

  • FXCM Trading Station II is probably one of the best forex trading platforms out there for novice traders. It’s fairly easy to use. In fact it’s such a nice system even Deutsche Bank uses it with their DBFX trading station. But in the case of FXCM don’t expect the trading station to behave exactly the same in live mode as in demo mode. There is definitely a difference even though you can’t see the difference structually. Even FXCM admitted the live mode and demo mode aren’t exactly the same. They look the same but your trading experience while in demo mode will be a lot more profitable than while in live mode. That should make you wonder. They say it’s the slippage and volatility but in demo mode you’re almost always profiting. In live mode almost always losing….

  • The truth is you probably won’t get rich trading forex. Successful forex traders understand the foreign exchange market and currency trading on a level that is not understood by the average retail forex trader. If you don’t actually understand the fundamentals or even the technicals for that matter you’re going to find it’s a lot more difficult to make a profit from your fx trading account; but even though it will be difficult it’s not impossible. You probably won’t join the forex millionaires club,  but you can still make decent money.

Latest Flickr photos

Financial tools & Services

Latest Topics

Here is a video that aims to demonstrate how you can make money trading currencies using Fibonacci Retracements and Fibonacci Profit Targets.

This video demonstrates a method for making money in the foreign exchange market using pivot points. Pivot points are turning points.

In the forex market the term would apply to the the points throughout the previous trading day at which traders and investors leaned towards a bull market or a bear market in general sentiment.

Ken Calhoun with forexonfire.com talks about how you can learn the technical signals to use and how to spot pivots, break outs, break downs using currency pairs when reading your charts, and how to setup your charts for currency trading.

He talks about currency pair volatility, learning how to spot patterns, pivot points, learning when to exit and not initiate another trade.

Here is an educational video of sorts put out by the guys gftforex.com. The video aims to teach you how to spot forex options scams centered around advisory services and newsletters ect. It is very detailed and straightforward.

The video suggests that your scam siren should definitely start going off if anyone comes trying to sell you on forex options trading by promising they have a system that is:

Easy
Low Risk
Based on secret trading methods used by the pros which the pros don’t want you to know
Available to you even if you don’t have lots of money thanks to leverage.

A look at forex trading. This video attempts to take the mystery out of foreign exchange by breaking it down into it’s “principal parts and players”.

The video explains how foreign currency is brought to other countries and how this creates the practice of currency trading. The video addresses the role central banks of countries, commercial banks, financial companies and brokerage houses, and private individuals play in the foreign exchange markets.

Latest Videos

Categories

Meta