Forex trading is a daily multi trillion dollar activity that involves buying and selling pairs of national currencies on an open market. An example would be the EUR/USD which is the euro as the base currency and the US dollar as the quote currency. These pairs are traded in contracts using leverage of up to 100 to 1.
With leverage you assume risk payable to your forex broker if your trade loses. You can control $100,000 with $1000. Large sums of money can be made from the comfort of home, however proper training is essential to successfully trade on the forex market.
What is the difference between trading forex as opposed to the stock market? Forex trades seek to profit in short to intermediate time ranges. Stock traders normally expect to stay with their trades for a longer period of time.
This has resulted in a huge industry of people willing to sell systems, software, e-books, and advice on how to profit as a forex trader. To weed out the good from the bad learn to ask the following questions before you buy anything.
1. Ask the success rate of real time current trades as well as the amounts of money made. Ask to see actual proof. Specify that you do not want to see any hypotheticals track records based on back trading. A trade done in hindsight can always be shown as a winning trade.
2. If you purchase a system or engage a forex guru make sure you understand the logic of the system to ensure you develop the appropriate discipline, confidence, and common sense that fully compliments using the system successfully.
3. Ask if there is a money back guarantee if the system you purchase does not live up to the promises or if you determine that you are not happy with trading on the forex market. If you go through a “cool down” period and feel forex isn’t for you then ask for a refund of your money during the refund period.
In regards to discipline you have to trade during the peak hours of the forex market to maximize your opportunities to profit. You want to trade when the volume is heaviest and market forces prevail. After you enter a trade maintain your discipline to know when you need to pull out. Do not let emotional greed overtake your trading strategy. The market can be affected and manipulated by big players during non peak hour. Trading when market forces prevail protects your trades.
There are two types of forex trading: Fundamental Analysis and Technical Analysis.
Fundamental analysis involves gathering and synthesizing information from news reports about inflation, national politics, and unemployment to get the big picture on situations affecting national currencies.
Technical analysis focuses on the use of fundamentals with charts. The charts are less time consuming and allow the trader to plot in real time imminent possible opportunities to profit.
An additional strategy is to use automated forex robots. The trading robots can be sophisticated or bare-bones, depending upon their price and features. The robots have fans as well as critics. The idea behind forex robots is that the robot will buy and sell currencies for you once you set the parameters.
Keep in mind that there are millions of currency traders, sharing the risk, losing their money, and also profiting from their trades. The recurring denominator among all traders is that they should learn, ask questions, and use discipline. Whether a stay at home parent, executive, retiree, or college student, there just may be a place for you in the forex market. And remember, while it is great to be excited and enthusiastic, it is also just as important to go slow and be realistic.
Live long and prosper.
With leverage you assume risk payable to your forex broker if your trade loses. You can control $100,000 with $1000. Large sums of money can be made from the comfort of home, however proper training is essential to successfully trade on the forex market.
What is the difference between trading forex as opposed to the stock market? Forex trades seek to profit in short to intermediate time ranges. Stock traders normally expect to stay with their trades for a longer period of time.
This has resulted in a huge industry of people willing to sell systems, software, e-books, and advice on how to profit as a forex trader. To weed out the good from the bad learn to ask the following questions before you buy anything.
1. Ask the success rate of real time current trades as well as the amounts of money made. Ask to see actual proof. Specify that you do not want to see any hypotheticals track records based on back trading. A trade done in hindsight can always be shown as a winning trade.
2. If you purchase a system or engage a forex guru make sure you understand the logic of the system to ensure you develop the appropriate discipline, confidence, and common sense that fully compliments using the system successfully.
3. Ask if there is a money back guarantee if the system you purchase does not live up to the promises or if you determine that you are not happy with trading on the forex market. If you go through a “cool down” period and feel forex isn’t for you then ask for a refund of your money during the refund period.
In regards to discipline you have to trade during the peak hours of the forex market to maximize your opportunities to profit. You want to trade when the volume is heaviest and market forces prevail. After you enter a trade maintain your discipline to know when you need to pull out. Do not let emotional greed overtake your trading strategy. The market can be affected and manipulated by big players during non peak hour. Trading when market forces prevail protects your trades.
There are two types of forex trading: Fundamental Analysis and Technical Analysis.
Fundamental analysis involves gathering and synthesizing information from news reports about inflation, national politics, and unemployment to get the big picture on situations affecting national currencies.
Technical analysis focuses on the use of fundamentals with charts. The charts are less time consuming and allow the trader to plot in real time imminent possible opportunities to profit.
An additional strategy is to use automated forex robots. The trading robots can be sophisticated or bare-bones, depending upon their price and features. The robots have fans as well as critics. The idea behind forex robots is that the robot will buy and sell currencies for you once you set the parameters.
Keep in mind that there are millions of currency traders, sharing the risk, losing their money, and also profiting from their trades. The recurring denominator among all traders is that they should learn, ask questions, and use discipline. Whether a stay at home parent, executive, retiree, or college student, there just may be a place for you in the forex market. And remember, while it is great to be excited and enthusiastic, it is also just as important to go slow and be realistic.
Live long and prosper.
