What
is forex trading? This is the
trading of currencies from various countries alongside each other. Forex is the
acronym for Foreign Exchange.
Example
For
instance, in United States the currency in circulation and being used is called
the US Dollar (USD) and in Europe, the currency in circulation is called the Euro
(EUR). An example of forex trading
is the buying of the Dollars while at the same time selling Euro. This trade is
called going long on the EUR/USD.
Trading on Exchange
Trading
on the exchange is usually done through a marker maker or broker. As a trader
on the exchange you may take two currencies known as a pair of currencies that you
are certain will adjust in value and place a trade on the exchange for that
reason.
Place Orders
Orders
may be placed with just a couple of clicks and the broker has passed the order
along to a partner in the Interbank Market who credits your account with the
gain or loss. This call all happens within only several seconds.
Currency Pair
As
a trader on the foreign exchange you are allowed to pick currencies from 2
countries making a currency pair. If you believe that there will be a change in
value, then you place a trade in view of that.
Practice Account
Part
of training is a practice account where you do trades with the market in real
time – but they don’t count as this is a fake account. Whether you make gains
or losses, it doesn’t count – it is only a practice account. You will have a
broker to help you learn the ins and outs of trading on the market. The broker
will have developed trading strategies in the years that the broker has been
worked on this trading market. This is a chance for the new trader to learn all
about trading on the Forex from someone who has experience.
Education
This
is all education of the different strategies that are used to trade on Forex. First
you learn the basics; then you have a broker that you work with and finally setting
up and using the practice account.
But
before you do anything, you should know that no one should use any money on any
markets that you cannot afford to lose.
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