Forex Trading Is The Trading Of Currencies Of Various Countries

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.