I hope you will agree with me when I say, starting out something you have never done before it's not that easy. So that is not different with forex trading.
Most people are interested in trading in the financial market, but getting the required steps to get started is harder.
Therefore, when you are done going through this guide you will meet successful real-world results by following the steps we explained here.
Let's get started right away!
The question is: how can you get started trading forex? Well, that's where this complete guide comes into play.
About The Author
My name is Onyebuchi Isu,
I spent years trying to become a consistent profitable trader before I finally succeeded. It was one failure after another.
Finally, I banged gold in 2021 and even became a forex coach now tutoring over 200 students in Udemy educational web resource.
How?
By applying the exact forex techniques I share with you in this post.
So if you want to become successful trader, keep reading. I promise, I will show you exactly how To do that.
Now Here's a comprehensive guide tailored for Forex Trading beginners; covering everything you need to know from basics and platforms to becoming that profitable trader you've ever wished to become.
First thing first.
What is Forex?
Simply as the name suggests rather, in it's full meaning (Foreign Exchange).
It is the global decentralized market for trading currencies.
In this market, currencies are bought and sold in pairs, with the most common being EUR/USD (Euro/US Dollar), GBP/USD (British Pound/US Dollar), and USD/JPY (US Dollar/Japanese Yen).
when you travel to another country maybe for medical assessment, or for leisure, holidays, backpacking, greener pasture etc.
You would get to exchange your currency to the currency of the country you are visiting, right in their airport's exchange booth.
Therefore, at this point you want to exchange your currency to theirs, by doing that it would enable you to buy things in the local market of that country you are visiting.
Imagine visiting south Africa as a Nigerian, you failed to exchange Naira to south Africa Rand. Now you are hungry, and you decided to go into a local restaurant to buy food. Are you going to pay them with Naira? It's a big NO! You can't do that.
This is quite different from exchanging the currencies as a business. Maybe you've decided to go into the foreign exchange as a business, or investment? I want to believe this is why you are here.
Further more, in terms of size, the forex market is the largest financial market in the world, with an average daily trading volume exceeding $6 trillion.
To put this into perspective, the New York Stock Exchange (NYSE) has an average daily trading volume of around $50 billion, the Tokyo Stock Exchange (TSE) around $40 billion, and the London Stock Exchange (LSE) around $8 billion.
Therefore, the forex market is far more bigger than stock exchanges in terms of trading volume.
Major News Networks That Cover This Financial Market
These are major global news networks that would give you daily updates on the financial market:
CNBC, Bloomberg, Reuters, and Financial Times. They provide regular updates on forex markets, including currency pair prices, economic indicators, geopolitical events, and central bank announcements that can influence currency movements.
Forex Trading Sessions
Forex trading is unique because it operates 24 hours a day, five days a week, across different time zones.
This continuous trading is made possible by the global nature of the forex market, with trading centers in major financial hubs like London, New York, Tokyo, Sydney, and others.
As one market closes, another one opens, ensuring that forex trading can occur at any time. This around-the-clock trading allows for greater flexibility and accessibility for traders around the world.
Conversely, you can use this tool (Forex Market Time Converter) for better timing. Simply insert your location/zone and forex market time converter will match your time zone to the current market times.
10 Workable Tips To Apply
1. Understanding Forex Trading Basics:
Learn what forex trading is and how the forex market operates. You may want to revisit the lines we highlighted above.
Familiarize yourself with basic forex terminology such as currency pairs, pips, lots, and leverage. How do you do that? Simple, just follow or subscribe to this blog (
forex market money blog )
2. Essential Tools For Forex Trading:
a. Computer or Mobile Device: You'll need a reliable device with internet access to trade forex.
b. Trading platform: choose a reputable online forex trading platform provided by a broker.
c. Chatting Software: Many trading platforms offer built-in charting tools, but you may also consider using third-party charting software for advanced analysis.
d. Economic Calendar: Keep track of important economic events and announcement that can impact currency pairs.
e. News Sources: Stay informed about market news and developments through financial news websites, economic reports, and analysis as we mentioned above.
3. Selecting a Forex Broker:
Looking for a broker that is regulated by a reputable financial authority.
Consider factors such as: trading costs (spread, commissions), platform usability, customer support, and available trading tools. Ensure the broker offers a demo account for practice trading.
4. Choosing a Trading Platform:
Most brokers provide their own proprietary trading platforms, which vary in features and usability.
Popular trading platforms include MetaTrader 4 (MT4), Meta Trader 5 (MT5), cTrader, and proprietary platforms developed by brokers.
Evaluate different platforms based on your trading preferences such as: charting tools, order types, and customization options.
5. Setting Up a Demo Account:
Open a demo account with your chosen broker to practice trading with virtual money.
Use the demo account to familiarize yourself with the trading platform, place trade, and test different trading strategies without risking real capital.
6. Developing a Trading Plan:
Define your trading goals, risk tolerance, and preferred trading style (e.g. scalping, day trading, swing trading, position trading or trend following).
Determine which currency pairs you will focus on and establish clear entry and exit criteria for trades.
Implement risk management techniques such as: setting stop-loss and take -profit levels.
7. Learning Technical and Fundamental Analysis:
Study technical analysis tools such as: chart patterns, indicators, and candlestick patterns for analyzing price movements.
Understand fundamental analysis concepts including economic indicators, central bank policies, and geopolitical events that influence currency prices.
Bookmark this page, when you are done with those free classes, you can come back and head over to my advanced trading course at Udemy.
8. Practicing Risk Management:
Only risk a small percentage of your trading capital on each trade (typically 1-2%). Use stop-loss orders to limit potential losses and protect your capital.
Over-leveraging your trades could result in huge losses as well as profits. Therefore protect your equity.
9. Starting Live Trading:
Once you feel comfortable with your trading strategy and have demonstrated consistency in your demo account, consider transitioning to live trading.
Start with a small amount of capital that you can afford to lose. Monitor your trades closely. I did not mean you should be looking at your screen every seconds. At least give sometime. And adhere to your trading plan.
10. Continuous Learning and Improvement:
Forex trading is a journey of continuous learning and Improvement.
Stay updated on market developments, economic news, and trading strategies. Analyze your trading performance, identify areas for improvement, and adapt your approach accordingly.
Consider joining online trading communities or forums to exchange ideas and learn from experienced traders. Although, we are developing a community here too.
Key Takeaways:
Stay disciplined and patient, especially during periods of market volatility. Keep emotions in check and avoid making impulsive trading decisions.
Review your trading plan regularly and make adjustments as needed. Celebrate your successes and learn from your mistakes to become a more skilled and profitable forex trader over time.
Conclusion:
in this guide, we've talked about everything there's to know about forex basics, setting up demo account, platforms to becoming a consistent profitable forex trader and more.
Over to you. Which of the tips do you wish to try first? Let us know in the comment box.
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