Currency trading, currency exchange, forex trading trade or FX are just four different titles often given to invest in the currency exchange market. If you are interested in investing in the foreign exchange market, then you need to understand the basics seven currency trading:
1) What is currency trading?
Currency trading is simply the purchase and sale of currencies and make a profit from a positive price change between two different currencies involved in a business. The two currencies are known involved in a business like the forex pair. The most commonly involved common currency in Forex is the US dollar that is involved in 85% of transactions.
A Forex trader will monitor the financial markets and react to the evolution of the price movement between a currency and another. He makes a profit if he buys or opens a cheap business and sells or closes at a higher price. The competence is to be able to understand what is happening on the market and correctly anticipate the movement up or down currency prices. There are many tools available to help market analysis – the most common being a variety of graphics that show historical trends and trends. Increasingly, there are new trading software entering the market that automates a large part of this process (visit my blog for monthly reviews of these products).
2) The exchange market
The volume in the foreign exchange market is massive, with about $ 4 trillion traded each day. International banks and financial investment companies are the main actors, but above all now with the Internet and high-speed connections, the market has opened to small private investors who arrive on the market in their herds. The constant price fluctuation between currencies offer a profit market for the advised investor.
3) Investment capital
A few hundred dollars is enough to start. You must open an account with a broker, but in general, they do not charge any expenses in advance or commissions and to give them the money for the propagation of the purchase prices and the sale of the currency and Lever (visit my blog for more details).
4) Hours of negotiation
Because the monetary market is global, it is actually open 24 hours a day, 5 days a week. It opens at Sydney, Australia at 22:00 UTC on Sunday evening and farm at 22:00 UTC on Friday afternoons in New York.
Unfortunately, too many people enter the foreign exchange market and wait to become rich quickly. Forex trading is not the game, it is a skill that can return good benefits if you enter with the good state of mind and are ready to learn the different tips and techniques. In any form of investment where the potential profit is high, are also the potential losses. Even the most qualified and experienced traders lose money and should not be turned off when you do. The important thing is to do more gains than losses, so start small and learn from your mistakes. Always trade with stop loss, especially if you use any form of automated trading software, it protects you against huge losses if the market should suddenly turn against you.
6) Strategy and systems
You need a clear strategy and develop a profitable system in this strategy. Fear and greed are your worst enemies. Work hard to understand the markets, study the cards and get a feel for the many factors that influence the price movement. Persevere and especially be consistent.
7) You are in control
You are in total control of your investment. Unlike most other forms of investment such as actions and actions, you are not dependent on the performance of a third party. As long as you learn currency trading bases and learning to recognize global events that affect currency prices, then you are in a position of strength to take advantage of positive trends in currency prices.