How To Learn The Basics Of Forex Trading

                                                         

how-to-learn-basics-of-forex-trading

                                                               

The advantage of forex trading was previously available to large and strong financial institutions in the past. The things have changed. Trading in forex is now available to all individual traders as well. As a result, many new comers in this segment are interested in learning the basics of this sort of financial activity.

Forex market or foreign exchange market is the largest financial market in the world where all major and strong currencies of the world such as - USD, GBP, Jap Yen, Euro, Deutsche Mark, Australian Dollar, Canadian Dollar, are traded everyday. This awesome market generates almost trillions of dollars of currency exchanges everyday and is open 24x7 every week.

The market is highly liquid and anybody can buy or sell any currency any time of the day with the help of a computer and internet. 


Transactions in forex market is always done in pairs. This means when a trader buys some currency he/she sells another currency. Buying of a currency and selling of another currency take place simultaneously. 

The most common and popular pairs of currencies are USD/GBP, USD/JPY, USD/CHF etc. The first three letters of a pair indicate the currency a trader sold while the last three letters indicate the currency a trader bought. For example, in the pair USD/JPY - a trader sells USD to buy JPY.

The basic things one needs to participate in forex market are :

• A computer with high speed internet connection

• A forex trading account

• An honest, reputed and reliable forex broker/broker firm commonly a company who advises the traders and helps to accomplish the trade

• And the most important of all - A trading strategy

A forex broker earns a small percentage of commission from the traders for the services they render. These services include :

• offering real time quotes

• the most lucrative pair to trade and why

• offering funds or limits in trading account

• supplying updated news and technical charts

• training and guidance

When a newbie enters the market he/she risks his/her hard earned money in the trading account. So, it is absolutely indispensable to choose the right broker and undergo a thorough training before entering the market.

It's true you can never learn how a trade in the forex market actually takes place unless you take part in the trading. Practising hand in a Demo Account, available with all brokers these days, is the ideal solution.

True, forex market offers a lucrative way of earning and profession but still one must remember this is not free from risks. Also true, many earned fame and unprecedented amount of wealth but at the same time many left the market for ever after suffering substantial losses. So always keep yourself alert and informed in forex.