There are so many definitions for foreign exchange commonly known as forex market or Forex(FX).
The most common definition is the exchange of one currency for another at an agreed exchange price. It also be defined a market where currencies are traded in
other words Forex is the buying and selling of currencies .This market is opened 24 hours a day 5 days a week giving you the flexibility of trading anytime after work or whenever you hear a financial scoop.
Now the foreign exchange market, being known as “forex” or “FX,” as said above is the largest financial market in the world with traders buying and selling currencies simultaneously through a broker.
These currencies are always in pairs e.g. EURUSD implying EURO and US dollar , GPB/USD implying the British pound and US dollar. So
when you trade in forex it simply means you either buy or sell currency pairs .The key word used in forex definition above
Agreed exchange price always fluctuates(rise and fall irregularly ) based on which currency is stronger at the moment
Looking at the definition of Forex lets take a real look at how we can make profits in Forex
As mentioned above in the definition Trading currency in the Forex market centers around the basic concepts of buying and selling.
Lets take the idea of buying to explain this. What if you bought something (it could
literally be almost anything...a house, a piece of jewelry or a stock) and it went up in
value. If you sold it at that point, you would have made a profit...the difference between
what you paid originally and the greater value that the item is worth now.Currency trading is the same way...
Lets say you want to buy the AUDUSD currency pair. In this example AUDUSD implies Australian Dollar and the US Dollar
If the AUD goes up in value relative to the USD and then you sell it, you will have made a profit. A trader in this example would be
buying the AUD and selling the USD at the same time.
For example if the AUDUSD pair was bought at 1.0615 and the pair moved up to 1.0700 at the time that the trade was closed/exited, the profit on the trade
would have been 85 pips i.e. 1.0700 – 1.0615 = 85 . Also, it makes no difference which currency pair you are
trading. If the price of the currency you are buying goes up from the time you bought it, you will have made a profit.
Here is another example using the AUD. In this case we still want to buy the AUD but let’s do this with the EURAUD currency pair
(Implying Euro and the Australian Dollar). In this instance we would sell the pair. We would be selling the EUR and buying the AUD
simultaneously. Should the AUD go up relative to the EUR we would profit as we bought the AUD.
Having Look at how we can make profit in forex lets now take our attention to the requirement of trading forex.
Basically there are no special requirement to trade forex . You simply need the right information and education.
The financial world changes constantly and with it does the rules of Forex trading. You have to willing to stay up to date, keep learning, and
continuously testing your knowledge * Keep an open mind as a trader all the time to make profits consistently .
With all this been said as a beginner you need to practice whatever you have learnt on a demo.
Practice account. It is called practice account because it is meant for practice and testing of strategies,
you would need to practice every single information or details you learn.
*How do you practice on a demo account? By selectively and choosing a broker wisely
.After choosing your broker you need to open a demo account with them
*start practicing till you have practice enough then move ahead to a real account
*Start with a small deposit and increase it gradually
*Be emotionally Stabilize by controlling anger, stress and happiness. *Trading Forex is an emotionally trying task.
Those who are able to create consistent profits have taken it upon themselves to emotionally manage.
Even highly calm/stoic people should still emotionally manage.
The most common definition is the exchange of one currency for another at an agreed exchange price. It also be defined a market where currencies are traded in
other words Forex is the buying and selling of currencies .This market is opened 24 hours a day 5 days a week giving you the flexibility of trading anytime after work or whenever you hear a financial scoop.
Now the foreign exchange market, being known as “forex” or “FX,” as said above is the largest financial market in the world with traders buying and selling currencies simultaneously through a broker.
These currencies are always in pairs e.g. EURUSD implying EURO and US dollar , GPB/USD implying the British pound and US dollar. So
when you trade in forex it simply means you either buy or sell currency pairs .The key word used in forex definition above
Agreed exchange price always fluctuates(rise and fall irregularly ) based on which currency is stronger at the moment
Looking at the definition of Forex lets take a real look at how we can make profits in Forex
As mentioned above in the definition Trading currency in the Forex market centers around the basic concepts of buying and selling.
Lets take the idea of buying to explain this. What if you bought something (it could
literally be almost anything...a house, a piece of jewelry or a stock) and it went up in
value. If you sold it at that point, you would have made a profit...the difference between
what you paid originally and the greater value that the item is worth now.Currency trading is the same way...
Lets say you want to buy the AUDUSD currency pair. In this example AUDUSD implies Australian Dollar and the US Dollar
If the AUD goes up in value relative to the USD and then you sell it, you will have made a profit. A trader in this example would be
buying the AUD and selling the USD at the same time.
For example if the AUDUSD pair was bought at 1.0615 and the pair moved up to 1.0700 at the time that the trade was closed/exited, the profit on the trade
would have been 85 pips i.e. 1.0700 – 1.0615 = 85 . Also, it makes no difference which currency pair you are
trading. If the price of the currency you are buying goes up from the time you bought it, you will have made a profit.
Here is another example using the AUD. In this case we still want to buy the AUD but let’s do this with the EURAUD currency pair
(Implying Euro and the Australian Dollar). In this instance we would sell the pair. We would be selling the EUR and buying the AUD
simultaneously. Should the AUD go up relative to the EUR we would profit as we bought the AUD.
Having Look at how we can make profit in forex lets now take our attention to the requirement of trading forex.
Basically there are no special requirement to trade forex . You simply need the right information and education.
The financial world changes constantly and with it does the rules of Forex trading. You have to willing to stay up to date, keep learning, and
continuously testing your knowledge * Keep an open mind as a trader all the time to make profits consistently .
With all this been said as a beginner you need to practice whatever you have learnt on a demo.
Practice account. It is called practice account because it is meant for practice and testing of strategies,
you would need to practice every single information or details you learn.
*How do you practice on a demo account? By selectively and choosing a broker wisely
.After choosing your broker you need to open a demo account with them
*start practicing till you have practice enough then move ahead to a real account
*Start with a small deposit and increase it gradually
*Be emotionally Stabilize by controlling anger, stress and happiness. *Trading Forex is an emotionally trying task.
Those who are able to create consistent profits have taken it upon themselves to emotionally manage.
Even highly calm/stoic people should still emotionally manage.
