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The forex trading, also referred to as the forex trading market, is the
largest financial market in the world, with a daily average turnover of
approximately US$1.3 trillion. Forex is the simultaneous buying of one
currency and selling of another. The world's currencies are on a
floating exchange rate and are always traded in pairs, for example
EURO/USD or USD/CHF
In the United States, there are several branches of the stock market,
each with their own name. For instance, some stocks trade on the Dow
Jones, others on Nasdaq. Of course, all stock market transactions in
the United States take place on the New York Stock Exchange (NYSE).
In other countries the same is true. However, international trade takes
place on the market termed the Foreign Exchange Market, or Forex.
Several countries across the world in almost every time zone
participate in trade on Forex, with multiple currencies being utilized
and stocks and commodities from all participating countries being
offered for trade. Because there are so many nations and time zones
involved, Forex does not function as a “business day” entity like most
domestic stock markets. It remains open for trade 24 hours a day, 5
days a week. This means your asset or investment have the potential
to shoot up exponentially or if you do not have good trading practice in
place plummet until your account is wiped out completely.
This is one reason for several safety options, like limit orders, good
entry and exit point which you will learn later. This is also why it is
strongly recommended that you should first do some practice trading
and learn from experienced traders.
ISSUES ARISING
Pip is percentage increase in price, this is what you should aim for, the
bigger the pips the better for your account and overall profits. No pips
no profits.
But this is not the only advantage you get when trading FOREX, compared to
other ways of investment and speculation; i.e. Stocks and Commodities. You have
a whole bunch of advantages over these other options that will be enumerated in
the following paragraphs.
With a daily trading volume of over $1.5 trillion, the spot FOREX market can
absorb trading sizes that dwarf the capacity of any other market. In fact, when
compared with the $50 billion daily market for equities or the $30 billion futures
market, it becomes quickly apparent this gives you, and millions of other FOREX
traders, almost infinite trading liquidity and flexibility.
The FOREX Market never sleeps. Trading positions can be entered and exited at
any moment - around the globe, around the clock, six days a week. There is no
waiting for an opening bell as in the case of trading stocks. It is a 24-hour,
continuous electronic (ONLINE) currency exchange that never closes. This is very
desirable for you if you want to trade on a part-time basis, because you can
choose when you want to trade: morning, noon or night.
Although currency prices in the FX market may be volatile, they generally repeat
themselves in relatively predictable cycles, creating trends. The strong trends that
foreign currencies develop are a significant advantage for traders who use the
"technical" methods and strategies taught at a number of sources.
Unlike stocks, currencies rarely spend much time in tight trading ranges and have
the tendency to develop strong trends. Over 80% of volume is speculative in
nature and, as a result, the market frequently overshoots and then corrects itself.
As a technically-trained trader, you can easily identify new trends and breakouts,
which provide for multiple opportunities to enter and exit positions.
When you trade FOREX, through one of our recommended brokers (this info is in
our private resources section), you'll do it totally commission-free! These brokers
don't charge commissions to trade or to maintain an account, and that goes for
all clients trading the FOREX through them, regardless of your account balance or
trading volume. Even Mini FX traders can buy and sell currencies online,
commission-free.
What about trading fees? There are none of the usual fees to which futures and
equity traders are accustomed – no exchange or clearing fees, no N_F_A or
S_E_C fees. Because currencies trade over-the-counter (OTC), via a global
electronic network -- in FOREX, what you see is what you get, allowing you to
make quick decisions on your trades without having to worry or account for fees
that may affect your profit/loss or slippage.
In the equities markets, you must pay both a commission and exchange fees. The
over-the-counter structure of the FX market eliminates exchange and clearing
fees, which in turn lowers transaction costs.
So, if a FOREX broker don't charge commissions, how do they make money? Like
all traded financial products, over-the- counter currency trading involves a
bid/ask spread, which represents the prices at which your counterparty is willing
to trade. Because the currency market offers round-the-clock liquidity, you
receive tight, competitive spreads both intra-day and night. Stock traders can be
more vulnerable to liquidity risk and typically receive wider trading spreads,
especially during after-hours trading.
7. Instantaneous Order Execution and Market Transparency.
Market transparency is highly desired in any trading environment. The greater the
market transparency, the more efficient the market becomes. Unlike other
markets where transparency is compromised (like in the Enron scandal), FOREX
markets are highly transparent (i.e., analyzing countries, and having access to
real-time research / news, is easier than companies).
The Forex market offers the highest level of market transparency out of all the
financial markets. Because of this, order execution and fill confirmation usually
occur in just 1-2 seconds. Markets that do not offer executable prices and force
traders to absorb slippage obviously compromise the trader's profit potential
considerably.
In the forex world, order execution is all-electronic and because you'll be trading
via an Internet-based platform, instantaneous execution is routine. There are no
exchanges, no traditional open-outcry pits, no floor brokers, and consequently, no
delays.
Finding a good broker is very important. You will need a reliable and
trustworthy Forex trading broker if you want to successfully trade in
the Forex market. A broker will provide the platform for you so can
have access to the international currency market. Just as it is
impossible to trade stocks without an intermediary calls
stock broker, it is also impossible for a Forex trader to trade in
currency market without a broker.
To participate in Foreign Exchange market therefore, requires that you
work with an intermediary called Forex Broker.
In other to maximize your profit and also make your trading
experience
smooth you must work with a reliable broker.
Regulation.
First and foremost, you must make sure the broker you want to be
trading with is regulated by regulatory authority in the country where
the broker resides.
There are fraudulent brokers out there and 99% of the fraudulent ones
are not regulated. Though some of them claimed they are registered,
don't be deceived by business registration.
Support
Look for a broker who provides around the clock support 24 hours a
day
7 days a week just in case you do run into any problem. make sure
that the broker has a reliable customer service. It should offer
different channels where you can get support. This means the broker
should have live support, telephone assistance, and email support
services.
Minimum Deposit.
Minimum deposit is an issue for many people when they open a forex
trading account. Many brokers require big minimum deposits,
sometimes as high as $5,000. However, other brokers sometimes
require as little as$100 to open a trading account. Forex trading uses
leverage which lets you earn big sums of money with little money
invested, although it's not recommended to trade forex with little
capital. If you are short on cash,make sure your broker will allow you
to open an account even with what you have.
A good a Forex broker should have a mini or micro Forex account. This
means you can easily get a Forex account and start trading even if you
invest only $100 to $200. This will minimize your risk and very
suitable if you are just a novice in Forex trading.
Leverage
Ask about the leverage options of your forex brokers. Leverage, which
is presented in ratio,will tell you the proportion between the total
capital available for trading versus your actual capital.
Aim for a forex brokers with flexibility in their leverage margin so as to
allow you to opt for the leverage that is suitable for you.
Lot Size
Most of the forex signal services provide signals for only a handful of
major popular currency pairs, such as EUR/USD, USD/JPY, GBP/USD,
and USD/CHF. Seldom can you find specialty services that provide
signals for other minor traded pairs. Forex signals can be valued, even
upwards of $100/month. The advantage of subscribing to such a
service is that they evaluate and munch the data for you, saving you
time. Nevertheless, it should be noted that using a signal service is no
substitute for a proper education in the Forex markets. Signal services
provide you with facts you need to know what to do with it.
While shopping for a signal service, make sure they provide you with
chronological data so that you can observe their track record for
yourself. Bear in mind that like any trader, Forex trading signals
services also have loosing trades. You should not expect a signal
service to be a certain ticket to immediate forex wealth, but rather
look at them as another device in your trading toolbox. Companies
that offer FOREX signals do on a paid basis and so you have to sign up
and give a monthly or yearly fee. Some brokers may provide this
service as an additional one that integrates into their trading software.
Types of Signals
Volume indicators are used to find out market interest. High volume
(especially near the bottom of the market) indicates the beginning of a
new trend while low volume indicates investor insecurity. Bollinger
Bands specify potential changes in the marketplace. Sharp price
variation tends to occur when the bands constrict while prices that
touch one band tend to go all the way to the other band. Other
indicators like volatility and momentum can be used to strengthen
signals offered by other sources. When taken together, they form a
comparatively reliable source of information on how the market is
behaving.
Of course not or else we would all have been millionaires. Signals can
give you good counsel about which currencies to trade, but no signal
service will promise their information is 100% accurate. Reliable
services will show you their track record, however, and give you the
choice of selecting it yourself. Do not think that signals can take the
place of trader instruction they are guides, and if you don't have the
knowledge to explore the information, you should go back to the
tutorials before using a signal service.
Forex signals are indicators that let you know when it's a good time to
buy or sell a currency pair. They provide you with insight as to what's
going on in the Forex market without the necessity to monitor Forex
trends throughout the day. If you are self-employed or employed by
another company, Forex trading is likely a part-time endeavor for you.
You won't have time to sit at the computer and monitor the Forex
market all day.
Forex signal services are available to provide signals to you around the
clock. These services usually have professional Forex traders who
monitor the market 24/7 and provide you with up-to-date information.
These services often charge a monthly or yearly subscription fee for
their services.
The methods used to deliver the Forex signals to you can vary from
one service to the next. Signals can be sent through email alerts, to
your phone or cell phone, through your pager, or even through a pop-
up software system that will show a screen on your computer each
time a signal is sent. The services also vary in how they present
information to you. Some will provide live charts to give you more
insight as to what as happening in the market.
When choosing a Forex signal service, be sure the company offers the
type of signal alerts you need. Every person is different. Some require
computer or email alerts, while others are not near a computer most
of the day. Find out how the company will send your signals before
signing on. Also, determine what type of information you would like to
receive. Do you want simplicity or would you rather monitor and study
charts and graphs about the market?
GETTING STARTED.
• Start reading all the Forex materials you can get.
• Open an account with a Forex Broker.
• Start demo trading. I usually advice people to wire/transfer actual cash to
their preferred broker even as they are still practicing. This usually make
them serious with their practice.
• Always make it a point of duty to read informative Blogs, visit Forex
Forums, network with like minded Forex traders online.
• Bookmark http:cashexchangesystem.blogspot.com/ and visit it everyday
for information, tips,tutorials and resources. It will greatly enhance your
chance of making good profits in the volatile Forex market.
Recommended Resources.
EToro
eToro is an innovative Forex trading platform that enables novice traders to easily
enter the exciting arena of currency trading, through a friendly interface. The
platform is based on visual representation of financial transactions, allowing users
an intuitive approach to Forex trading, while combining special features such as a
community chat and championships with prizes.
eToro solves the biggest hurdle faced by competing financial platforms, which is
how to appeal to non professional traders. eToro accomplishes its goal to enable
non professionals and people interested in learning and practicing trading, by
easing the way into this world through a user friendly environment. The trades
are represented in a clear graphical visualization, coupled with online tutorials,
live support and the embracing community communication through the in-
platform chat and the forum.
eToro revolutionized the Forex trading arena with a novel approach that broke
through the old bank-like interface and brought it straight into the web2.0 style
interface and community, allowing everyone to participate in the biggest and
most exiting market of currency trading.
Established in order to provide services to the growing retail sector of the Forex
community, eToro created a visual trading platform that is easy to understand and
easy to use. The overall offering that eToro introduces to its users is the most
inclusive trading experience available to both novice and experienced traders, so
they can experiment, further learn, and polish their trading skills.
eToro Offerings:
eToro makes it faster and easier than ever to execute trades, watch your trading
activity, share, and enjoy financial information - using real or virtual money.
View your trades interactively: Trades are visually represented so you can watch
your trades run marathons, rise and fall between countries and more.
Practice: Apply your trading skills with real-market rates on virtual money.
Compete with other traders:Various free-to-enter championships are held so you
can get a chance to win top prizes and become the top trader.
Chat: Interact with friends and fellow traders either privately or publicly.
Trade: Trade for real money with real-time trade execution.
Low Spreads: eToro is offering some of the lowest spreads on the market, as low
as 2 pips on most currency pairs.
JC-LYONS
Many a forex broker rating of JC Lyons purports its, the first of its kind, visual
based and learning platform is exceptionally easy to use. Its perfectly suited for
people just starting to learn currency trading and it delivers everything an
experienced trader requires also.
Many new, but also experienced traders, give this broker their top forex broker
rating due to its innovation in visual charting abilities. Viva la revolution!
Striking Features:
You can try this signal service risk free. By getting timely buy and sell signals.
Even if youdo not know how to trade, you can make good money with their
service. Set and forget as soon you get the signals.
The members area is specially designed for you to be a complete money making
opportuity. The need for TradeFXplus.com was to adress a need to have a reliable,
stres-free forex trading opportunit that will be capable of allowing even a
Beginner or advanced trader to enjoy the good life while making cool stress free
money.
Winston Emmanuel
greengoldrush@gmail.com