Forex Trading: Best Forex guide for beginners
Forex is the collection of two words “Foreign Exchange”. We must have heard the word Forex trading and try to understand what is forex trading? Today I will answer this question most simply. It will be understandable by a forex beginner with zero knowledge of Forex Trading. So, if you already know about the basics of Forex Trading/ Foreign Exchange, please read our article on Advance Forex Trading.
- What is Forex Trading
- History of Forex and Foreign Exchange
- Forex Analysis & Forex Strategy
- Forex for beginners
- Forex Signals
- Some Good Apps for Forex Trading
What is Forex Trading:
As mentioned Forex is the collection of two words ” Foreign Exchange”. It is a global decentralized and over-the-counter (OTC) market for the trade of currencies. Its job is to determine the rates of every currency in the world. This rate is Foreign Exchange Rate(FER). It is:
Buying Selling and exchanging all kinds of currencies for business purposes.
Forex for beginners is knowing that Forex trading is buying a product and selling it for profit. The product in this case is Currency it can be USD, PKR, EUR. The people who do trading are Forex traders or Investors. These people have the expertise to determine which currency will be good for the future. The main stakeholders in Forex are the international banks. They permit the conversion of currency from one to the other.
Some of the characteristics which make Forex and Forex Trading Unique are:
- Forex has the advantage of largest trading volume in the world. This makes it big opportunity for the world and has high liquidity.
- It is globally accepted.
- Forex Beginners has many ways to earn like copy trading and Forex Signals.
- It keeps up for 24 hours except for the weekends.
- The cost of transaction is very low.
- Selling and buying of currency in pairs.
History of Forex and Foreign Exchange:
Forex was first happened in the 15th century by a merchant family named Medici. They needed banks at foreign locations to exchange money into local currencies. A forex market remained active in Amsterdam in the 17th & 18th centuries. Agents worked for British Empire in the 19th century. Alex. Brown & Sons were leading forex traders in the 1850s. The era of modern foreign exchange started after the 1880s.
At the end of World War I, the boom of forex trading started. The foreign banks in London had raised from 3 in 1860 to 71 in 1920. Reuters introduced computer systems replacing the old telephone systems. Countries accepted the need for free trade and ended their control over currencies. Forex never looked back after that and its volume is increasing since then.
Forex Analysis & Forex Strategy:
Forex analysis is analyzing the market to predict the price in the future. Whatever the method they use, the motive is always the same. Some common types of analysis are:
- Technical Analysis
- Fundamental Analysis
- Sentiment Analysis
Forex Strategy is the way of doing forex analysis. It gives a set of questions that need to be answered to devise a plan for a successful forex strategy. These questions can be:
- The time one will dedicate to the Forex.
- What are your expertise?
- What is the risk tolerance?
Forex for Beginners:
Nothing in this world is free, everything requires has a cost. Sometimes the cost is only your time and hard work. Learning is an important part of life and hard work and time are its key components. For beginners in forex, it is advisable to start with basic tools like trend lines and candlesticks. The best way is to watch and learn. Beginners can start learning from simple patterns like triangular figures, rectangular figures, and reverse patterns.
These layouts are easy to learn and beginners get a better chance to earn with the least risks. Learning the skill and finding your strengths and weakness is a crucial part. Utilizing strengths and minimizing weaknesses is easy if you know them. Remember learning before practising saves from failures. So educate yourself first.
A very good thing for a beginner is forex signals and copy trading. The copy trading is following the trading pattern of another trader. In this way, you rely upon the judgment of another person. If he wins you win and if he loses you lose. There are many such traders who never get lost. These traders tell you when to buy/sell and what to buy/sell. You can earn by following them. This information is a call signal.
Some Good Apps for Forex Trading:
Some good forex trading apps are:
- Best Forex Trading App for Beginners: FOREX.com.
- Best for Intermediate Traders: TD Ameritrade.
- Best for Advanced Traders: eToro.
- Best Technical Analysis Tools: Nadex.
We will post their review in a different article.
This is an informational article that gives a brief introduction to forex trading and a forex guide for beginners. It covers basic concepts of the forex market and forex market. It builds a basic understanding of the forex market. I have covered background information, definition and analysis of the forex market. I have explained how to do forex trading without having advanced knowledge and graph reading. Forex Signals are used to copy some other investor. You will earn if that investor earns and you will lose if that investor loses. There are investors who never lose. For more articles on Forex.