Published Thursday, Jul. 9, 2020, 3:30 am
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Today, remote work is more popular than ever. With conventional systems shattered, people are turning to alternative sources of income. Global financial markets are a click away. The foreign exchange is the largest of all: its daily turnover exceeds 6 trillion US dollars. But how does one become a trader?
Every rookie needs experience. The internet has an abundance of educational content, from articles to detailed video tutorials. Start with Forex Trading: A Practical Beginner’s Guide, which is available on https://trade-in.forex/forex-trading-a-practical-beginners-guide/, and create a demo account for training.
Logic of Trades
The value of any currency relies on multiple factors, both political and economic. For instance, collapsing oil prices send currencies of exporting nations down. From domestic policies to international diplomacy, the range is broad. Traders analyse the market using digital charting aids, and base decisions on fundamental or technical analysis (sometimes, both).
Every currency is valued against another one — hence the formula ‘base currency’/’counter (or quote) currency’. When you see that EUR/JPY is priced at 121.139, this means a Euro costs just over 121 Japanese yen. There are two interconnected prices at any given moment — Ask (for the buyer) and Bid (for the seller). The difference is known as ‘spread’, while each 0.0001 is a ‘pip’.
All traded combinations are classified as Major, Minor, or Exotic based on the economies they represent. To make a profit, participants take action depending on their prediction of trends. Suppose you have Euros in your account, and the market is expected to rise. You could buy more Euros now and capitalize on appreciation later (long position). In the opposite scenario, you would sell your instrument via a short position, and buy back more lots afterwards.
Tools for Access
All operations are performed via dedicated terminals, such as MetaTrader 4 or 5. These are comprehensive environments with everything you need:
- charts and graphs;
- news updates;
- position management tools;
- risk management tools, etc.
A demo account unlocks the system in the simulation mode. This is perfect for training purposes. Once a rookie is sure of their skills, they transition to live trading. Both types of account are created via a broker. This is the intermediary between you and the international exchange.
The Right Mindset
Like any form of investment, currency trades can be risky. Participants may use different ready-made strategies. Some open and close all positions within a single day. Others take a long view, opting for swing trading. There is no universal recipe — success boils down to foresight and effective decision-making.
Trading is not a random process: it is based on fundamental and technical analysis. Modern platforms are packed with analytical aids. Traders should also manage risks through special tools and asset diversification.
The Power of Currency Flows
Every day, immense volumes of currencies circulate on the global marketplace. Through dedicated software, individuals analyse trends and make effective trading decisions. With knowledge and persistence, foreign exchange can be a viable source of income.
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https://augustafreepress.com/basic-guide-for-forex-newbies/
2020-07-09 12:33:04Z
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