How to trade Forex
How to trade Forex? The best solution is to find information resources on trading and get acquainted with the basic concepts. Then choose a broker, start an account and enter the global market.
Beginners should remember what these concepts stand for:
Bid price: the trader wants to buy your currency at this cost.
Ask price: a trader sells currency to you at this cost. It is always higher than the Bid price.
Spread - the difference between these two prices, it is considered a commission for brokerage work.
Pip is the smallest unit of measurement of the changing price. It's 1% of your currency.
So far, a lot of literature has been developed on how to trade Forex. They all offer different methods and strategies. None of them is 100% winning, but you can apply all of them in a particular market situation.
How to Choose a Broker
After reading the literature, you should choose a broker. An online broker helps with trading, provides the necessary programs and tools, and provides liquidity for orders. A reliable broker will minimize the risks and pay the profits on a timely basis.
When choosing a broker for trading Forex, pay attention to such criteria:
Easy managing the terminal and the programs provided.
Wide range of educational resources and tools for analysis
Access to an extensive list of currencies
Size of leverage
Spread sizes (brokerage fees)
How to Start Forex Trading
Before the start of Forex trading, you should analyze the world economy and the economy of your country. It is called fundamental analysis, i.e. forecasts on the global economy and, consequently, on the movement of currency rates. Any event in politics and economics influences the forex markets one way or another.
Also, you have to master the technical analysis. It is an analysis of currency charts using various indicators. Brokerage platforms provide an extensive list of tools for technical analysis. Both types of analysis help to find the right moment and the right price to buy and sell currencies.
The broker's blog and video instructions will tell you exactly how to place orders and close positions. Read and watch the guides to learn the chosen platform quickly. In general, trading is carried out according to a similar algorithm:
the trader analyzes the market,
opens a position (to sell or buy currency),
then after a while closes it (executes a deal).
During this time, the currency rate changes, this is how the trader earns money.
Online Forex trading can help you earn big money. The key is to remain calm and respond quickly to market changes.