Forex Trading - Another Way to Earn Profits Using Your Wits
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Introduction to Forex
What is forex?
The term ‘forex' is a nickname for Foreign Exchange market. The forex market is the largest market in the world because it has a volume of over $4 trillion a day; while the New York Stock Exchange only has $25 billion. A 10-digit figure is very big, indeed. Other names for this giant include: FX, FOREX, Retail forex, Spot FX or Spot.
Because the foreign exchange market is actually a cash market backed by large banks from all over the world, different foreign currencies are involved in the forex trading. Theoretically, the fx trade is a ‘spread' - where one must sell a currency to buy another.
FX market, like the stock market, is basically involved in trading. It is a continuous process of buying and selling currencies. Its main objective is to exchange one currency for another-with the expectation that the price of the currency bought will gain value that is higher than the currency sold.
Here's an example of earning profits thru buying euros:
- First, purchase 10,000 euros at exchange rate of 1.18 for EUR/USD
- After 2 weeks, exchange 10,000 euros back to US dollars at exchange rate 1.2500 to earn $700
How to Make Money in Foreign Currencies
What is an exchange rate? This term refers to the ratio of one currency valued against another currency.
Example: USD/CHF - indicates how many US dollars needed to purchase 1 Swiss franc, or vice versa.
Scalping in Forex Trade
There are a lot of things to learn about forex trading - but here are the initial important stuff to study:
- Reading FX quote
- Base currency
- Long and short (long means buy; short means sell)
- Bid and ask
- Spread
- Margin trading
- Demo trading
- Fibonacci
- Candlesticks
- Charts
- Indicators
However, you must not plunge into fx trading without undergoing a demo trade for at least 6 months. Combine the hands-on practice with studying everything about forex thru reading online information. One good site for beginners in forex is the Babypips' School of Pipsology.
DO NOT trade with a live account without making sure that you already have all necessary skills to trade successfully.
A successful trader has honed these 3 abilities:
- Make pips
- Keep pips
- Repeat making and keeping pips
Always REMEMBER, you shall be putting your hard-earned money at stake whenever you trade in the fx market-so be smart and patient. Never be greedy. This is one of the golden rules of forex trading.
Forex Books from Amazon
Related Links
- Forex Training Online: Learn Foreign Exchange (FX) Currency Trading
BabyPips.com’s School of Pipsology is designed to help you acquire the skills, knowledge, and abilities to become a successful trader in the foreign ... - Forex | currency trading | forex trading | forex broker
FXCM.com - 24 hour online forex trading with No Dealing Desk, spreads as low as 1 pip, trading from charts, and live support. - Forex Trading Information, Forex E-books, Articles, Brokers
Forex trading information site EarnForex.com provides info about foreign exchange currency trading. Learn about Forex market, download free Forex e-books, Forex articles and use free Forex tools. - FXrebates| Welcome to FX Rebates | Are you getting your $4.11 forex rebates
FX Rebates offers $4.11 cashback rebate per forex round lot traded. This service is free with over fifteen brokers to get your forex rebates from. - Forex Trading | Forex Education | Online Currency Trading | Forex Market
Online currency trading with Forex Club. Forex education for beginners and advanced Forex tools for experienced traders. - Forex Trading
Time to Trade on FX - Forex Trading - Global Foreign Exchange Markets
Forex trading resources including analysis and news, online trading tools, currency market research, articles & education materials.
Currency Trading Books from Amazon
Related Forex Blogs
- Cross-Eyeing: EURJPY - Trade Closed
Good afternoon! We saw broad Yen weakness over the past couple of days, pushing EURJPY higher to my entry level and beyond...way, way beyond to my stop out level! Grrrrrr! Let's see what happened... - 4 days ago
- Cross-Eyeing: GBPJPY - Close Open Orders
Good morning! It looks like I couldn't catch a break on GBPJPY as I missed the initial break of the symmetrical triangle, and now the market failed to make it up to my short entry point at 148.50 on the retracement. - 2 weeks ago
- Cross-Eyeing: GBPJPY
Good afternoon! There's a sweet chart pattern forming on GBPJPY signaling that the pair may break out in the near future. Let's take a look, shall we? - 4 weeks ago
- Cross-Eyeing: EURJPY - Trade Closed
EURJPY couldn't find a bid today as sellers came in and pushed the pair lower throughout the three major trading sessions on concerns the economy wouldn't be able to sustain itself once stimulus is withdrawn. - 5 weeks ago
- Cross-Eyeing: EURJPY - Closed Trade
Good afternoon! My long position was triggered at 130.00 and after consolidating for a short period of time, buyers pounced on EURJPY and quickly pushed the pair back up to 131.00. - 2 months ago
- Cross-Eyeing: EURJPY - Trade Closed
It looks like EURJPY sellers were no where to be found in this bullish market as the falling trendline failed to hold this time and EURJPY found its way to my stop out level. - 3 months ago
- Cross-Eyeing: EURJPY - Close Trade
Good morning and what a morning it is with the US releasing this month's jobs data. We certainly saw massive volatility after the US reported a loss of 216K jobs in August. Even more importantly to traders, unemployment rose to 9.7%. Yikes! - 3 months ago
- Cross-Eyeing: EURJPY - Close Open Orders
What is up! Looks like I couldn't catch a break during today's trading session as my short orders at 136.00 never triggered. It was a volatile day for EURJPY as the pair fell to - 3 months ago
Forex Trading in the News
- Your Source for Daily FOREX Market News and AnalysisDaily FX10 hours ago
EUR/CHF: No directional bias here with the market confined to a multi-day range. Daily studies are in neutral territory and a clear break back above 1.5250 or below 1.5000 will be required for additional insight and clarity. Until then, traders can be content to trade the range extremes.
- Your Source for Daily FOREX Market News and AnalysisDaily FX1 second ago
US Dollar, Japanese Yen Mostly Higher as Risk Trends Drive Trade Once Again The US dollar and Japanese yen generally traded in line with risk trends on Monday, quelling speculation that the currencies had permanently diverged.
- Your Source for Daily FOREX Market News and AnalysisDaily FX5 hours ago
The Euro crossed back above the 50-Day SMA (1.4871) during the Asian trade to reach a high of 1.4906, but failed to hold ground and slipped to a low of 1.4756 as the European Central Bank talked down expectations for higher interest in the region.
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Comments
Hello, Nick Stavros! Thank you for dropping by. I hope you'll join HubPages, too. This is a good place to talk about all your interests :)
hi! i'm a newbie trader, glad i found this hub. :)
hi, newbie! thanks for dropping by :D
I see you really are the Queen, cleopatra, good advice well prepared and delivered
Hello, katyzz! Thank you for dropping by. I'm glad you like what you read here. :D
Nick Stavros says:
8 months ago
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