There are a number of markets to choose from, all with their pros and cons. A great place to start is forex trading for beginners. Forex is one of the most popular marketplaces for traders.
After learning the basic forex concepts and terminology, how to assess the market, make a trading plan and decide on a currency to invest in, you will be ready to start. Whether you decide forex is the right way ahead, or you prefer another market, you will need to find a good online broker. They can make or break, not only your trading experience, but also your chances of turning a profit.
Forex trading learning: the basics
“Forex” is the shortened form of “foreign exchange”. The foreign exchange can be utilized by companies, used to buy bonds in currencies, and more. Trading is its most popular use, however. Forex tracks the exchange rate between currencies and traders bet on the price movements between them. When one currency is tethered to another in this way, they are referred to as “currency pairs”. This makes trading forex a little different than other markets. You don’t just bet on one asset (“long”) you simultaneously bet against another (“short”) and vice versa.
All trades are based on price differences between currencies, but there are a number of ways to set up a trade. Such trade types include currency futures, currency options, retail forex, spot FX, spread betting, ETFs (exchange-traded funds) and CFDs (contracts for difference). These different forms of trade allow for a more customized approach. Currency futures and options, for example, allow you to get some insurance (“hedge”) for your investments, and CFDs let you cut out the exchange altogether by forming an agreement with your broker.
How to trade forex for beginners
Any guide to forex trading for beginners wouldn’t be complete without some popular strategies too. Of course, nobody can predict the future with any certainty, but there are a number of techniques traders use to push the odds more in their favor. The most popular trading tools are called “indicators”. These are software programs which help analyze and interpret price data to give you a better idea of a currency’s future trajectory. Popular forex indicators include the Bollinger Band, Simple Moving Average (SMA), Moving Average Convergence Divergence (MACD) and more.
Knowing which type of trade to conduct and the type of data analysis tool to use (and how to use it) can take a bit of time. Fortunately, some online brokers give you the option to trade with virtual money. Not only does this mean you can sharpen your skills without any financial risk, but you can also trial the platform at the same time. You will also need to find a trading platform which offers a forex market, indicator software and competitive commission rates. TradeOr is well worth considering as it can offer all of these features and more.
After learning the basics of forex trading for beginners, you can soon progress to trading on the forex market. The right approach to trading can make the difference between a profitable and unprofitable trader. After finding the right trading format, from hedging to spread betting, most successful traders will use market indicators to help form their trades. All of these skills can be practiced on the TradeOr platform. Using TradeOr’s “demo account”, you won’t need to risk your money while you’re learning. You can also explore their library of tools and resources to decide if it is the right trading platform for you.