Starting capital for Forex
One of the most important aspects of working on Forex is the size of the starting capital; the amount of earnings and the degree of risk when trading directly depends on this factor.
Many novice traders ask the question - How much can you earn by trading currencies? The answer to this question directly depends on the size of your deposit and the leverage with which you are trading.
Forex starting capital is the amount of funds that you deposit as a trader's deposit for further use in trading on the currency exchange.
Some brokers have requirements for the minimum amount of starting capital (deposit); this indicator can range from 1 to 2000 US dollars.
First of all, it should be noted that at the moment you can start real trading with literally 1 dollar, but in this case you will also earn a few cents a day.
Therefore, it is advisable to use the maximum possible starting capital, which will allow you to trade with less leverage, thereby minimizing the risk of trading.
Axioms of technical analysis.
As you know, in any business there are things that do not require additional evidence;
this also applies to technical analysis of the Forex market.
The axioms of technical analysis are conclusions made by more than one generation of traders about the movement of exchange rates and assessing the situation in various markets.
They are universal for both Forex and the stock and commodity markets.
All conclusions are grouped into several groups, so there are not so many axioms themselves:
Forex trend - concept, trend indicators and strategy based on them
The movement of the exchange rate always has its own direction, which is also called a trend; the direction of opening transactions depends on which direction the price moves.
The rate can rise or fall, and in some cases practically does not change, and is at the same level.
A Forex trend is the movement of an exchange rate within a certain time period, and it is the time interval that is used for analysis that is important, since on time frames of different durations a completely opposite direction of price movement can be observed.
If you compare two adjacent time frames, you will find that they contain trends that are different in direction.
The main indicators that characterize a Forex trend are its strength, duration, minimum and maximum points, as well as the magnitude of fluctuations.
Forex market participants.
First of all, you should understand what the Forex market actually is; in fact, it is a
virtual exchange that unites all existing currency markets.
The merger occurs due to the fact that Forex dealing centers use different markets or independently create trading platforms to increase liquidity.
Some people enter into agreements with several large banks, others simply enter the interbank currency exchange, and others use international exchanges. That is why the circle of participants in the Forex market is quite wide and diverse, but several main categories can still be distinguished.
How to start making money on Forex from scratch, training and practice
If you understand that you can earn really big money only by engaging in investment activities and trading, then the question immediately arises before you - How to start making money on Forex.
After all, Forex is now the most accessible and profitable exchange, the reason for this is the provision of maximum leverage – 1:1000, or even 1:2000 and simply fantastic capabilities of the trader’s terminal.
Currently, using the trading platform, you can trade not only currency pairs, but also many other interesting assets - gold, copper, oil, company shares, cryptocurrencies, etc.
Starting Forex trading from scratch consists of a few simple steps, which I will describe below, but in order to start making money it will take a little more time and effort, but as they say - He who does nothing has nothing.
Everything is not as difficult as it might seem at the beginning, the main thing is to take the first step and not give up if something doesn’t work out right away.
Types of Forex trading terminals.
The trader's trading terminal is the program through which all operations are carried out on the Forex currency exchange
.
Moreover, in the terminal you can not only make transactions, but also perform many different actions - conduct technical analysis, test strategies, receive news, etc.
According to their work, trading platforms can be divided into four main groups - standard, Web, mobile and automatic. It is this division that will allow the trader to choose the most suitable option.
If necessary, you can use several trading terminals at once, for example, a regular metatrader for working at home, and a web terminal for transactions outside the home.
Let's move on to an overview of the available options for Forex trading platforms:
Trading on the Forex market.
At the moment, there are not many ways to make money quickly; starting your own business
requires a lot of money and connections, and finding a high-paying job is not easy. Therefore, more and more people are paying attention to alternative earnings, Forex trading is one of them.
Trading on the Forex market allows you not only to earn money, but to make a profit, having a relatively small amount of money and without leaving home.
At the same time, it is not at all necessary to have a special education or have connections. As the history of trading in financial markets shows, taxi drivers, athletes, former military personnel and workers in other professions completely unrelated to finance have become quite successful traders.
How to become a trader?
The profession of a trader has always been surrounded by a romantic aura; luxury cars, huge houses and
expensive clothes are all associated with working on the financial exchange.
This is why the desire to become a trader arises in almost everyone who wants to earn a substantial fortune and rise to the top of the financial Olympus.
It would seem that such a money profession requires special education and a lot of recommendations when applying for a job, but this is not entirely true - today anyone can make money by playing on the stock exchange.
True, you should not confuse independent trading with working in a reputable hedge fund and trading with other people’s money; for this you must first become a professional and earn an appropriate reputation.
Forex plan.
A correctly drawn up plan is already half the battle; the main thing is to correctly
identify all strategic tasks at the initial stage of planning, and then describe the sequence of their solution.
Many novice traders make the mistake of thinking that the Forex work plan concerns only the trading process itself, namely, conducting trend analysis and carrying out transactions in the trading terminal.
Forex plan - will include setting goals, determining ways to solve them and, of course, the practical part of trading.
Psychology of Forex trading.
On Forex, as on any financial exchange, the influence of psychological factors is of great importance; they sometimes interfere with making the right decision and almost always serve as the main cause of losses.
Surprisingly, it was the psychological pressure of the market that caused most of the largest losses that occurred during the entire existence of the currency exchange. In this article I will try to outline the main points that will help you avoid making annoying mistakes.
Forex psychology mainly concerns the moments of opening new transactions or closing existing orders. What should you do to ease market pressure?
Forex trading system
A clearly developed Forex trading system allows you to increase your chances of success several times; it is the basis of professional trading, which is why it is so important to draw up a detailed action plan before starting trading.
The main points that must be included in the work plan are analysis of the market situation, selection of an entry point, determination of tactical points and points for closing transactions.
You should clearly describe all stages of trading and then follow the already outlined plan; this will reduce the psychological pressure of the market and protect you from spontaneous decisions.
The Forex trading system is more understandable if it is studied using specific trading examples.
Before drawing up a plan, you must already decide for yourself what you will trade, when you will trade and with what volume; only after answering these three questions do we begin to build our trading system.
Bid and Ask for stock trading and other applications
In stock trading, the terms "bid" and "ask" are used to indicate the price at which one is willing to buy or sell an asset.
The bid price represents the highest purchase price of an asset, and the ask price represents the lowest sale price of an asset.
In simpler terms, we can say the following about these prices:
Ask is the price of selling you currency, shares, gold or other goods, higher
Bid is how much you will get if you want to sell something, lower
Opening profitable trades on Forex
Transactions on Forex are carried out in two directions - buying or selling, the choice of direction depends on whether the exchange rate of the currency pair is rising or falling.
The transaction technique itself is quite simple and can be completed in just a few mouse clicks. To start trading, you just need to open an account at a dealing center .
After this, you can proceed directly to installing the necessary software and preparing for the operation itself.
Technical issues rarely raise questions among novice traders, but choosing the direction of transactions and developing trading tactics always raises a lot of questions.
Forex transactions are concluded using a special trader terminal , where orders are placed.
Such a terminal is downloaded directly from the selected broker, since each of the programs already has the necessary preliminary settings.
Self-analysis of the Forex market
Trading in the foreign exchange market is always carried out in two stages, the first of which is analysis, and based on the data obtained, forecasts of exchange rate movements are made.
The main object in this matter is the chart of the currency pair; it is on the basis of its history that all relevant conclusions are drawn.
To verify and confirm the obtained data, several methods of analyzing the foreign exchange market can be used at once, each of which is aimed at studying certain indicators.
Forex analysis methods.
There are three main methods used to analyze historical data - Graphical, Technical and Fundamental.
Each of them does not give 100% results, so to be completely sure, it is better to use at least two of the three options mentioned.
Currency Exchange Forex
Currency trading can be carried out on various platforms, but the most famous of them all is the forex exchange.
In addition, this exchange is also the most accessible for the average trader, as it is widely used for speculative transactions with currencies.
The forex currency exchange operates on the basis of market laws, that is, exchange rates are formed under the influence of supply and demand, while artificial regulation is completely excluded.
Large players can influence the price only by purchasing or offering large volumes of currency for sale.
Forex currency turnover amounts to several trillion US dollars per day; according to various estimates, this amount is from 3 to 5 trillion, depending on the demand for currency and market sentiment.
With hype trends, turnover increases several times.
The main players on the forex currency exchange are large brokers, also called market makers, they are the ones who make multi-billion dollar transactions and set the exchange rate, regulating the supply and demand of the currency.
How the foreign exchange market works, schedule, holidays, principles
The Forex currency market is not, in its essence, an exchange in the direct sense of the word; all operations on it are carried out online, that is, it does not have a specific trading location.
The purchase and sale of currency is carried out on special servers, using orders traveling along securely protected lines.
How the foreign exchange market works is almost around the clock, Forex opens at 2 a.m. Moscow time on Monday, and ends its work at night from Friday to Saturday.
That is, almost 5 days a week, with the exception of holidays - Easter, New Year, national holidays.
The work is carried out depending on trading sessions, which are tied to time zones. Usually there are four such sessions - Asian, European, American and Pacific.
Opening hours coincide with the operating hours of banking and financial institutions, for example:
Internet trading online is simple and profitable
If a dozen years ago, in order to trade stocks or currencies, you had to spend hours on the phone and transmit orders to open positions, but now the whole process has been significantly simplified.
Everything happens online and automatically, through a special trader’s terminal, you yourself give a signal to open or close an order, without the participation of intermediaries.
Online trading allows you to earn money with just a few clicks of the mouse.
To begin with, there is no need to have complex equipment, and an ordinary personal computer with Internet access is quite enough. Having an initial amount of capital is welcome, but not a prerequisite.
All necessary software and literature can be obtained free of charge.
You can trade via the Internet both on the foreign exchange and stock exchanges. It is these two types of Internet trading that will be discussed in this article.
Forex rules you need to know for successful trading
In order to become a successful trader, you should know and follow certain Forex rules, essentially these are recommendations, they indicate the basic principles of Forex trading, they can significantly reduce losses and not make ridiculous mistakes.
On the other hand, these are patterns, knowing which you can choose the most successful place to enter the market or, conversely, refrain from active trading.
The main feature of recommendations is that they are always in effect and you cannot escape their influence.
This set of Forex rules was compiled by more than one generation of traders and includes all the bitter experience of trial and error.
As you work, you can create your own rules; they will help you get organized and become more successful.
The most popular currency pairs on Forex and trading features
The most popular currency pairs are always characterized by a dynamic trend, which is what allows you to earn the greatest profit in a short period of time.
The second indicator that affects popularity is the size of the spread - the commission that the dealing center takes from each of your transactions when buying or selling currency.
The third point is the availability of ready-made strategies for the chosen trading instrument, because it is much easier to use someone else’s experience than to waste time creating your own trading system.
In addition, the time of trading and simply the personal preferences of the trader matter, some trade only at night, and some prefer the most predictable trading instruments, without sharp fluctuations in the exchange rate.
In order to choose the most suitable trading instrument, you must first conduct a brief analysis of popular currency pairs.
Basic laws of Forex.
In order to successfully trade on the foreign exchange market, you should clearly know what the laws of Forex are.
In essence, these are the basic principles under the influence of which the exchange rate changes - the price of a currency pair is what a trader’s entire work is based on.
These laws are based on the theory of probability and the history of exchange rate movements; it has long been known that any market is subject to patterns and any situation has a tendency to repeat itself in the future.
This is what allows us to predict the direction of a trend over time.
Forex laws are the basis on which the entire construction of a trading system on the currency exchange should be carried out.
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