The global pandemic has made online trading more popular than ever. Forex appeared in the 1990s, but the latest technologies have made it instantly accessible. Anyone can enter the global market using an internet-connected device. If you want to learn to make money online, here is how to get started.
The Key Facts
Foreign exchange is the largest financial market in the world. The daily volume of transactions between institutions and individuals (retail traders) reaches 6.6 trillion US dollars. Currencies are being exchanged all the time — this is an integral part of foreign trade, tourism, and banking. This market is decentralized, and you only need a broker to connect.
Choosing a broker is the first step for an aspiring trader. Trustworthy companies are licensed by reputable supervisory bodies like the FCA in the UK. The https://trade-in.forex/ guide will help you find a broker with excellent software, access, guidance, and support. It will act as the intermediary between your account and the market.
Logic of Trading
- The goal of a trader is to make a profit from short-term changes in the market.
- All currencies are traded in pairs as they are valued against one another.
- Each pair has two different prices — for the sellers and the buyers. For example, if the Bid price for EUR/USD is 1.16457, the seller wants to get 1.16457 US dollars for every Euro.
The prices are rising and falling all the time, as this market rarely sleeps. It is driven by fundamental forces, from the interest rates of central banks to the oil prices to political tensions. Therefore, by buying and selling currencies at the right time, you make a profit.
Software Tools
Every broker offers one or more software products that are usually free to use. The range includes platforms for desktop and mobile devices with all popular OS. You can trade from your laptop, tablet, or smartphone.
Your trading platform is the digital environment where all of your transactions and operations take place. Here, you will analyze the charts and news to forecast the price direction, program and execute trades and collect the profits. It must be user-friendly, reliable, and easy to navigate. If the broker uses a VPS, it will protect you from interruptions due to power outages or system crashes.
Risk Management
Forex is inherently risky, as the market is beyond anyone's control. Traders limit exposure by setting special triggers like Stop Loss and Take Profit. As soon as the price reaches the predefined level, your trade is executed automatically, so you do not have to sit in front of the screen 24/7.
Guidance for Beginners
As Forex is popular around the world, there is no shortage of video guides, articles, books, and tutorials on the internet. Begin with the materials provided by the broker, learn about the basics and the most popular strategies, such as day trading and swing trading.
