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Forex Trading For Beginners

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Forex FAQ

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 Forex
QUESTIONS ANSWERED...


How Can I Get Started With Forex?

Answer...

Step 1: Choose a broker and create an account

Step 2: Take the trading platform in hand

Step 3: Train on a demo account

Step 4: Make your first deposit

Step 5: Start trading in real money

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What should I look for in a Forex Broker?

Answer...

1. Commissions:

2. Spread

3. Rollover

There are NO guarantees of success, no matter which system, strategy, or program you might be using. A good rule of thumb is that if someone PROMISES you success in trading, you will likely experience the exact opposite of that. Don’t hand over your money for what they are trying to sell you. So, while “Is Forex Trading Expensive?” can be relatively easy to answer in terms of transactional costs as listed above, there is always the chance that your actual trading capital can be lost and that’s the part of trading that can make it expensive.

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Now that we've reviewed basic terminology, let's look at some of the differences between trading stocks vs. currencies. In currency trading you are always comparing one currency to another so forex is always quoted in pairs. Sometimes authors of currency research will refer to only one half of the currency pair. For example if an article is referring to the euro (EUR) trading at 1.3332 it's assumed the other currency is the U.S. dollar (USD).
The FXCM Group is headquartered at 20 Gresham Street, 4th Floor, London EC2V 7JE, United Kingdom. Forex Capital Markets Limited (“FXCM LTD”) is authorised and regulated in the UK by the Financial Conduct Authority. Registration number 217689. Registered in England and Wales with Companies House company number 04072877. FXCM Australia Pty. Limited (“FXCM AU”) is regulated by the Australian Securities and Investments Commission, AFSL 309763. FXCM AU ACN: 121934432. FXCM South Africa (PTY) Ltd is an authorized Financial Services Provider and is regulated by the Financial  Sector Conduct Authority under registration number 46534. FXCM Markets Limited (“FXCM Markets”) is an operating subsidiary within the FXCM Group. FXCM Markets is not regulated and not subject to the regulatory oversight that govern other FXCM Group entities, which includes but is not limited to the Financial Conduct Authority, Financial Sector Conduct Authority, and the Australian Securities and Investments Commission. FXCM Global Services, LLC is an operating subsidiary within the FXCM Group. FXCM Global Services, LLC is not regulated and not subject to regulatory oversight.
Another element of the service provided is the margin requirements and level of leverage available. While there is no need to choose the highest level of available leverage when you start trading Forex, simply knowing that a broker offers the highest level of leverage approved by their regulator means that, as your experience grows, you can start to increase your leverage according to your preferences.
If you've been researching Forex trading, you might have seen the term 'Forex CFDs' at some point. There are two ways to trade Forex: using CFDs or spot Forex (also known as margin). Spot Forex involves buying and selling the actual currency. For example, you might purchase a certain amount of Pound Sterling for Euros, and then, once the value of the Pound increases, you may then exchange your Euros for Pounds again, receiving more money back compared with what you originally spent on the purchase.
Risk warning: Trading Forex (foreign exchange) or CFDs (contracts for difference) on margin carries a high level of risk and may not be suitable for all investors. There is a possibility that you may sustain a loss equal to or greater than your entire investment. Therefore, you should not invest or risk money that you cannot afford to lose. Before using Admiral Markets UK Ltd, Admiral Markets AS or Admiral Markets Cyprus Ltd services, please acknowledge all of the risks associated with trading.
Just like stocks, you can trade currency based on what you think its value is (or where it's headed). But the big difference with forex is that you can trade up or down just as easily. If you think a currency will increase in value, you can buy it. If you think it will decrease, you can sell it. With a market this large, finding a buyer when you're selling and a seller when you're buying is much easier than in in other markets. Maybe you hear on the news that China is devaluing its currency to draw more foreign business into its country. If you think that trend will continue, you could make a forex trade by selling the Chinese currency against another currency, say, the US dollar. The more the Chinese currency devalues against the US dollar, the higher your profits. If the Chinese currency increases in value while you have your sell position open, then your losses increase and you want to get out of the trade.
Whether you are a beginner trader or a pro, it is best to trade with what you see and not what you think. For example, you might think that the US dollar is overvalued and has been overvalued for too long. Naturally, you will want to short and you might be right eventually. But if the price is moving up, it does not matter what you think. In fact, it doesn't matter what anybody thinks – the price is moving up and you should be trading with the trend.
Almost every retail forex brokerage offers the MT4 platform. If you are going into warfare, common sense reasoning dictates that you practice with the same weapon which you will have to use on the warfront, as no one goes into battle with an unproven rifle (or unproven skills for that matter). So if you are going to start off trading any real money, you simply have to start your learning journey with the MT4 platform.
Trade Interceptor is another popular trading app available for iPhone and Android users. The app provides traders with a host of options, including the ability to trade currency pairs, binary options, and commodity futures through a choice of forex brokers. The interface offers analysis and technical trading tools, including nearly 100 technical chart indicators.

Challenge: Banks, brokers and dealers in the forex markets allow a high amount of leverage, which means that traders can control large positions with relatively little money of their own. Leverage in the range of 100:1 is a high ratio but not uncommon in forex. A trader must understand the use of leverage and the risks that leverage introduces in an account. Extreme amounts of leverage have led to many dealers becoming insolvent unexpectedly.

Investors – Investment firms who manage large portfolios for their clients use the Fx market to facilitate transactions in foreign securities. For example, an investment manager controlling an international equity portfolio needs to use the Forex market to purchase and sell several currency pairs in order to pay for foreign securities they want to purchase.
Indicators Gann Square Root The use of square root relationships in market analysis is an often overlooked method of identifying potentially important inflection points in price. Despite infrequent use, square root relationships are considered by some traders to be one of the easiest and most reliable methods of identifying potential support and resistance points in just about any freely... $ 29 Details
Now you know the what, the why, and the how of Forex trading. The next step to to create a trading strategy. For beginner traders, the ideal scenario is to follow a simple and effective strategy, which will allow you to confirm what works and what doesn't work, without too many variables confusing things. Fortunately, banks, corporations, investors, and speculators have all been trading the markets for decades, which means there is already a wide range of Forex trading strategies to choose from. These include:
Since the market is made by each of the participating banks providing offers and bids for a particular currency, the market pricing mechanism is based on supply and demand. Because there are such large trade flows within the system, it is difficult for rogue traders to influence the price of a currency. This system helps create transparency in the market for investors with access to interbank dealing.
Foreign exchange markets have never before been so easy to access like now when you can literally access them from the palm of your hand which is incredibly cool. Whether you are looking into making a trade or you want to check if and how the world currency rates have changed or you want to know the latest macroeconomic news and market news, you can find all this right information using the appropriate app. There are many excellent apps in the market and myriad financial apps that are available for your mobile device. Some of the forex trading apps are free while some of them are gotten at a cost. Forex trading now commands a wider reach thanks to its online presence through the forex trading apps. The popularity of forex trading has since reached a notch higher thanks to the advent of the forex apps available. Since its inception, the trading apps have been a catalyst to making it a more profitable and lucrative trading avenue. From the undeniable flexibility to staying updated on any news to getting to choose a broker, these apps speak volumes when it comes to efficiency and convenience thus are a must get.
Another element of the service provided is the margin requirements and level of leverage available. While there is no need to choose the highest level of available leverage when you start trading Forex, simply knowing that a broker offers the highest level of leverage approved by their regulator means that, as your experience grows, you can start to increase your leverage according to your preferences.
Hedge funds – Somewhere around 70 to 90% of all foreign exchange transactions are speculative in nature. This means, the person or institutions that bought or sold the currency has no plan of actually taking delivery of the currency; instead, the transaction was executed with sole intention of speculating on the price movement of that particular currency. Retail speculators (you and I) are small cheese compared to the big hedge funds that control and speculate with billions of dollars of equity each day in the currency markets. 

One unique aspect of this international market is that there is no central marketplace for foreign exchange. Rather, currency trading is conducted electronically over-the-counter (OTC), which means that all transactions occur via computer networks between traders around the world, rather than on one centralized exchange. The market is open 24 hours a day, five and a half days a week, and currencies are traded worldwide in the major financial centers of London, New York, Tokyo, Zurich, Frankfurt, Hong Kong, Singapore, Paris and Sydney - across almost every time zone. This means that when the trading day in the U.S. ends, the forex market begins anew in Tokyo and Hong Kong. As such, the forex market can be extremely active any time of the day, with price quotes changing constantly.
Governments / Central banks – A country’s central bank can play an important role in the foreign exchange markets. They can cause an increase or decrease in the value of their nation’s currency by trying to control money supply, inflation, and (or) interest rates. They can use their substantial foreign exchange reserves to try and stabilize the market.
Indicators MT4 FXCM SSI MT4 FXCM SSI, powered by fxengineer.com, plots the historical FXCM Speculative Sentiment Index (SSI) directly on your MT4 chart! FXCM SSI is a very popular data indicator and until now was not available on the MT4 platform, but now it is! Look back at historical SSI levels directly on your chart and easily and quickly compare with past price movements and... $ 99 Details

Swing trading: Swing trading is a medium-term trading approach that focuses on larger price movements than scalping or intraday trading. This means that traders can set up a trade and check in on it within a few hours, or a few days, rather than having to constantly sit in front of their trading platform, making it a good option for people trading alongside a day job.
Now that we've reviewed basic terminology, let's look at some of the differences between trading stocks vs. currencies. In currency trading you are always comparing one currency to another so forex is always quoted in pairs. Sometimes authors of currency research will refer to only one half of the currency pair. For example if an article is referring to the euro (EUR) trading at 1.3332 it's assumed the other currency is the U.S. dollar (USD).
For traders—especially those with limited funds—day trading or swing trading in small amounts is easier in the forex market than other markets. For those with longer-term horizons and larger funds, long-term fundamentals-based trading or a carry trade can be profitable. A focus on understanding the macroeconomic fundamentals driving currency values and experience with technical analysis will help new forex traders to become more profitable.