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Only you will know about your income when trading on Forex. You can plan your day without being tied to a work schedule. You conduct all trading operations directly from home via the Internet. Read more: Bulls and bears, as well as other animals on the stock exchangeForex tradingSo, Forex trades world currencies, in other words, you can buy one currency by paying with another. The exchange rate is the purchase or sale price of a currency. Trading is conducted in currency pairs.
The composition of a currency pair means which currency you can buy or sell. In principle, Forex transactions are similar to bank currency exchange. The difference is that the trader chooses the most favorable rate at a certain point in time, and sells or buys the desired currency, making a profit from it. Profit can be obtained both by raising and lowering the exchange rate.
The speculative principle remains unchanged: the cheaper you bought a currency and the more expensive you sold it, the greater your profit will be. What you need to startThere are no restrictions in Forex trading. However, individuals can only make transactions through intermediary or brokerage companies. Such a company, on your behalf and on your behalf, will carry out transactions on Forex and will provide you with a special trading program platform for electronic currency trading.
Forex makes it possible to make transactions for amounts significantly exceeding the trader's personal funds. Money in the form of an interest-free loan is provided to the trading broker. Lending volumes are characterized by the term "leverage", meaning the ratio of the trader's own funds to the maximum possible borrowed amount.
It is clear that greater leverage implies the possibility of transactions with large amounts. Before starting trading in a brokerage company, you should open a trading account and deposit your own money into it. This operation takes only a couple of minutes.
Read more: How to read Japanese candles correctly? Instructions and examplesForex transactionTransactions take place over the Internet through a specially developed computer program called a trading platform. This program is presented by a broker.
Data is sent to the platform in real time. You will see quotes of many currency pairs on a chart showing price changes. The visibility of the chart allows you to determine the optimal moments for buying or selling currencies. How are decisions made on the sale and purchase of currency? Such decisions are based on the analysis of the currency market. Of the two types of analysis, the trader chooses the one that seems to him the most reliable. If it is more convenient for a trader to compare economic, political and other facts, then he uses fundamental analysis.
Many traders see mathematical and computer patterns in Forex trading principles. Such traders are guided by technical analysis. The trading platform offered by the trader includes all the data for both types of analysis. The information in the platform is constantly updated. The economic news coming here allows us to conduct fundamental analysis, and special technical tools determine the possible movement of quotations based on the statistical data of earlier trades.
It remains for the trader to monitor the signals of the technical indication that serves as the basis for making transactions. Earning on ForexSpeculative profit on Forex appears as a result of buying a currency at the minimum price and selling at the maximum.
For example, a trader, assuming that after a while the value of the euro will increase, buys euros. The instruction to the broker to buy the currency is given by pressing the Buy button. Accordingly, having decided to sell the euro due to the expected fall in the exchange rate, you need to press the Sell button. The instruction will be executed immediately, and all transaction data will be clearly reflected on the trading platform below the price chart.
This data will include current currency quotes and the amount earned on the transaction. The transaction is closed at the moment when the trader decides that the operations have reached maximum profitability. At this moment, by pressing the "Close" button, he completes the transaction, thereby fixing the profit on it.
The final result of the transaction is reflected on the trading platform, and the entire amount of profit goes to the merchant's deposit. Read more: How to read and use the Economic Calendar in tradingThe article contains only the basic concepts and principles of Forex trading, which, of course, are not enough for independent successful work.
More detailed information about trading and various trading strategies can be obtained from training programs and detailed analysis of real transactions. You can risk your own money only when the trader is firmly confident in the correctness of the decisions made in various situations. You can make sure of your own readiness by using training trading programs that allow you to simulate a process absolutely similar to the real one without the risk of losing money.
May 22, IndexaCo. Who are traders and why do they earn so much. Acquaintance with the financial market begins with the identification of participants and the exact clarification of their functions. The market assumes the presence of the main actors on it — traders.
That is, a trader is a person who directly trades, the main market participant. This term can be applied to all types of markets. If we talk specifically about the financial market, then the trader here operates with assets, earning on their sale and purchase. Categories of tradersThe entire trading corps can be divided into two groups — professional traders and private traders amateurs.
Professionals are part of the staff of various funds, banks and other financial organizations. Accordingly, in the market they act on behalf of these organizations, making transactions with their assets. Simply put, these are certified financiers who go to auctions as if for work. The category of professionals also includes traders who work exclusively for themselves and operate with their own funds. Since they have no other profession, they can also be classified as professionals.
The most numerous category is private amateur traders. Trading is not their main profession, and in the financial market they are engaged exclusively in additional earnings. Such traders do not have a specialized education, and they have to study independently. The financial market is attractive for the possibility of good earnings. That is why the number of amateurs exploring the market is constantly growing. The contingent of amateur traders is very mobile: someone, having failed and disappointed, leaves the market, counting on easy earnings also do not stay for a long time, but new, active and ambitious traders are constantly arriving.
Trading in the financial marketIn order to make a deal on the financial market, a trader needs to give an order to a broker about the desire to sell or buy an asset. Of course, the result of such operations should be profit. In order for trading to be profitable, you need to deeply know the market processes and patterns of movement of the value of assets. Not everyone can boast of fundamental knowledge, so success does not accompany everyone.
But perseverance and hard work are usually rewarded. Forex is not easy for a beginner, but the financial market has never been easy. If a trader from our days could be transferred to the stock exchange a century ago, he would also hardly be able to work right away. Firstly, he would be deprived of electronic devices and the Internet, from which you can draw the necessary information for trading, while maintaining contact with the broker. Secondly, he would be very limited in the possibilities of technical analysis.
The theory of technical analysis itself did not exist at that time, and traders used separate provisions of Charles Dow, which were later systematized into a single theory. Today, the trader has all the tools to make the right decision. Prices are presented in graphic images of more than a dozen types, clearly demonstrating current and future fluctuations. The latest developments in the markets are published by many media outlets, including such reputable ones as Bloomberg or Reuters. Current currency quotes are transmitted online.
The revolution in trading in financial markets has taken place in just a hundred years. Previously, a small circle of people had the opportunity to become a trader, but today the market is open to almost everyone. Read more: Five stages of becoming a traderFinancial market trading instrumentsFinancial market traders use technical and fundamental types of forecasting in their work. The technical one is presented graphically, and the fundamental one is based on economic data.
By tracking the information on the terminal, based on the learned patterns, the trader predicts future quotes. The terminal is the most important tool of a trader, which is a platform for communication with a broker and an analytical tool. Modern terminals provide information on prices, various indicators and graphical tools.
Modern trading is also impossible without automated trading systems, which are called robots or Expert Advisors in the professional slang of traders. Such systems trade autonomously according to the initial parameters. Such a parameter, for example, can be the volume of transactions. There is a lot of talk about the feasibility of using robots, but, in any case, no machine can be more effective than a competent trader. Another serious tool can be considered an economic calendar with announcements of economic events: speeches by economists and heads of banks, politicians, publications on economic topics, etc.
So, a modern trader trades on the Internet using Internet trading platforms. Before the appearance of platforms on the Forex market, only large financial organizations participated in trading — banks, funds, etc. With the advent of the Internet, exchange trading has become accessible to ordinary users — knowledge and only a few hundred dollars are required.
Trading strategyTraders have different views on the market situation — it is they who determine the trading strategy. One of the important characteristics of the strategy is the duration of transactions. According to this characteristic , several types of investors can be distinguished:long-term, making long-term transactions for several years. The analysis is based on global characteristics and indicators;short-term, making several trading transactions during the year;positional, working on a long-term strategy.
Transactions last for several days with profit taking during periods of reduced activity holidays, vacations, etc. As a rule, such traders have a small trading capital, and trading positions are realized quickly;a scalper who makes trades in a very short period from a few seconds to 10 minutes. With a large number of operations, profitability is not ensured for every transaction.
Traders working on this strategy are forced to constantly stay at the monitor and monitor suitable transactions. Read more: The main components of a Trading StrategyWhat does a currency player doFirstly, he trades various currencies. The principle of successful trading is simple — it is cheaper to buy and more expensive to sell. The trader operates with currency pairs consisting of two currencies. When buying such a pair, a trader buys euros for US dollars. The main advantage of the Forex market for traders is its liquidity.
There is a constant supply and demand in Forex, and trading is conducted without interruptions five days a week. The choice of currency pairs for trading is wide: you can trade "majors" the so-called pairs that are traded through the dollar or "crosses" without using the dollar. A trader should be ready to trade not only theoretically. No less important is the right psychological attitude, which is often ignored by beginners.
Having familiarized themselves with a couple of strategies, they rush headlong into trading, risking losing all their money and forgetting about the two main enemies of the trader — fear and greed. Greed often kills capital, and fear does not allow it to increase. Many newcomers seek to get rich instantly by opening deals and not thinking about money management. Most often, such traders simply lose all their money. Mistakes appear, and money goes away. Risk management is very important for a trader.
When opening a trade, a trader must accurately imagine the possible volume of not only profits, but also losses. Minimizing risks is the main task that a trader should be able to solve. Read more: How to become a trader from scratchFrom amateurs to professionalsA successful amateur of stock trading can become a professional. Professional trading has clear advantages: the trader now works only for himself, he does not need to go to work in the office, he plans his own working hours.
But the main thing now is that the trader is the owner of his own capital, and only his well—being depends on his work. A professional stock market player lives by certain interests - news related to stock markets, currencies, economics, stock statistics, commodity prices. Plunging into this atmosphere, after a while the trader begins to understand this, makes decisions based on independent analysis. For a professional, there is no limit to the accumulation of information and knowledge.
He is constantly improving — only this is the key to his success in the profession. Who are ECN Forex brokers. Their advantages and disadvantages. ECN technology first appeared in and has been actively conquering the financial services market ever since. But let's figure out how this transaction execution system differs from others, what advantages and disadvantages it has, and whether all traders really need to choose ECN accounts for Forex trading.
What is the difference between an ECN broker? First of all, it is worth clarifying that ECN is not some special category of brokerage companies. And in order to understand how this system differs from others, we suggest considering the most common systems on the market.
DD brokersThere are two sides to trading in any market: the seller and the buyer. A broker, as a rule, is an intermediary, a way to enter the market and make transactions with the seller directly. If we talk about Forex trading, the broker must provide direct access to liquidity providers.
But this is not about dealing centers. DD Dealing Desk brokers are counterparties that set their own quotes, above or below the market, and also offer a fixed spread. Such brokers are also called market makers, that is, companies that "make the market".
The advantage of such a broker is the low size of the minimum deposit, the disadvantage is the lack of direct contact with liquidity providers and freezing of orders. This order execution system in translation means "without the participation of a broker", that is, the broker does not interfere in the trading process and cannot influence quotes, the size of spreads and other factors.
The NDD broker provides clients with access to the interbank market, that is, traders trade directly with liquidity providers. The task of an NDD broker is to bring transactions to the market, and the company's earnings are based on the commission that traders pay for placing transactions. STP brokersThis type of broker belongs to the NDD system: the company does not participate in transactions, does not affect the size of quotations and does not set its own rules.
The STP broker trades using a computer system. The system transfers orders to the interbank market, that is, transactions are carried out without the intervention of a broker, and customers receive direct access to liquidity providers. The broker does not interfere in the trading process in the same way, traders get access to market quotes, and transactions are brought to the interbank level. However, unlike STP, which uses a fully automated program to withdraw transactions, ECN broker cooperates with a network of international banks and other liquidity providers directly, and its trading platform is linked to them.
This allows you to ensure the highest possible speed of execution of orders and also guarantees their accuracy. Read more: The history of the origin of the Forex marketWhat is an ECN accountActually, some brokers offer ECN accounts to clients, which allow them to take advantage of all the advantages of ECN order execution, namely, direct access to liquidity providers and fast execution of transactions.
This means that the ECN system will be available only on this account, and on others, a different way of executing transactions is used. Also, beginners should take into account that ECN accounts often have a higher minimum deposit level. Therefore, brokers who offer an ECN system and at the same time set a low deposit need to be carefully checked. It is enough just to find a company that offers ECN accounts.
But not everything is so simple. In order for cooperation with a broker to be reliable and long-term, and work to be comfortable, when choosing a company, you should pay attention to the following criteria:Trading platformThe most common Forex trading terminals are MetaTrader 4 and MetaTrader 5. However, some brokers create their own platforms that differ in both interface and functionality. Therefore, when choosing an ECN broker, professionals are advised to proceed from personal preferences and take into account whether the necessary instruments are available in their own broker platforms.
Novice traders are recommended to choose brokers with MT4 and MT5 platforms. It's not just that their functionality is enough for both beginners and professionals. There are a lot of video and text materials on how to work on these terminals, while brokers' own platforms often remain without "instructions". InstrumentsTo trade with an ECN broker, it is advisable to choose instruments with sufficiently high volatility.
They give traders the opportunity to earn higher earnings, provided that they use the ECN system. Instruments with high volatility include currency pairs Forex , cryptocurrencies, CFDs and commodity futures. It is not necessary to use all these instruments, but it is desirable that the broker provides them. Only a trader can determine which leverage to choose based on his trading skills.
Beginners are recommended to set leverage of , professional traders choose higher leverage, up to In any case, it is worth remembering that leverage multiplies the amount of profit, but the higher it is, the greater the losses will be in case of an unsuccessful transaction. Minimum transaction volumeIt is impossible to trade micro lots 0.
RegulationThis point is relevant regardless of which broker the trader wants to cooperate with: stock, Forex or any other. When choosing a company, you should definitely pay attention to regulations. If a broker is under the supervision of one or more regulatory authorities and has a license to provide financial services, then you can safely cooperate with him. Regulators ensure that the broker fulfils its obligations to the client, and a license is issued only if the broker meets international or local requirements.
Checking the regulation, the trader initially weeds out all the "kitchens" — the companies of scammers. It is worth paying attention to the year of the company's opening and the site: "kitchens" do not bother with the interface, make the site simple and little informative, and they exist for no more than a year. Therefore, preference should be given to brokers who have been on the market for a long time.
Liquidity providersAn important factor that will allow you to distinguish a real ECN broker from a Forex kitchen. When choosing a company for trading, it is necessary to check which liquidity providers it cooperates with. Reliable brokers, as a rule, cooperate with global suppliers. If information about suppliers is not available on the site, and the support service responds with the message "this is confidential information", then most likely this broker has nothing to do with the ECN system.
Read more: What is margin trading: pros, cons and risksSoftwareThe success of trading depends on the quality and speed of the software, or rather, the correct execution of orders. Therefore, a trader, regardless of the type of trading strategy, should pay attention to the operation of the terminal.
It is important that the program does not hang, does not crash, and does not give an error or requotes. This is especially important when choosing an ECN broker, because the ECN system is characterized by instant execution of transactions, and software problems only hinder this. Minimum depositIt's worth starting with the fact that brokers with ECN accounts initially set a higher minimum deposit level. It is a rare case when the price of opening an ECN account is available to all users.
The high threshold of the minimum deposit is one of the main reasons why it is not recommended to open such accounts for novice traders: a beginner will easily lose the entire deposit and will be left with nothing since he has no experience in trading.
Therefore, if you are a novice trader, think carefully about whether you really need an ECN Forex Broker. If yes, then choose companies in which the minimum deposit is relatively low, since the risk of losing all capital is quite high. These criteria are basic, both experienced traders and beginners can use such a checklist when choosing an ECN broker.
To make it easier for traders to navigate, we have collected ECN brokers in the rating, where the minimum deposit amount and regulatory authorities of each of the companies are indicated. Professionals should start from individual needs and wishes. When should I open an ECN account? There is no doubt about the popularity of ECN brokers: they are preferred by thousands of traders from all over the world.
But let's see if such companies can really be called universal, or if there are cases when it is unprofitable to open an ECN account. First of all, an ECN broker makes it possible to trade with liquidity providers directly. The trader does not depend on the broker, on quotes within the company or on other nuances. The broker is simply an intermediary. This means that the trader will get access to real market data. And this condition is beneficial to all traders.
At the same time, ECN brokers offer a floating spread. This condition makes trading more difficult and unpredictable because a novice trader will not be able to assess the market situation and understand when it is better to open a deal so that the commission is lower. Also, this condition is not suitable for clients who are actively investing with conservative risks, because it will not be possible to calculate the exact amount of the commission, its size is constantly changing.
Read more: I got a margin call: we explain what it is and how to avoid itDo not forget about the high-speed execution of transactions. This condition seems attractive, but in fact, it is not suitable for all traders. High speed is an important criterion when it comes to scalping. Traders with such a strategy really need to cooperate with ECN brokers, because the profitability of their work depends on the accuracy of order execution. Novice traders simply will not be able to take advantage of ECN technology.
It is necessary to take into account the instruments with which the trader works. When trading cryptocurrencies, currency pairs and other assets with high volatility, the speed of transaction execution matters. But if a trader chooses to trade instruments with medium or low volatility, then the speed of work does not play such an important role, because the price of an asset simply will not have time to change in one or two seconds.
So, if the speed of execution of transactions is important to a trader and he works with highly volatile instruments, then it is definitely worth opening an ECN account. In other cases, it is necessary to build on the trading strategy and the client's requirements for trading conditions. Is an ECN account suitable for beginners? Novice traders and investors, when choosing the first broker, often pay attention to absolutely all criteria in order to eventually choose the best of the best.
This strategy can be understood because most traders want to choose a company for long-term cooperation, but there are criteria that are not so important for beginners. These include the availability of ECN technology. This system really has a number of advantages over dealing centers, and many novice traders are captivated by it.
But it cannot be said that the presence of ECN accounts is a mandatory criterion and when choosing the first company for trading, you should pay attention only to ECN brokers. An analogy with cars would be appropriate here: to learn how to drive, it is not necessary to buy a Lexus or a sports car. Yes, they will surpass some Opel in terms of characteristics, but their functionality is redundant for a novice driver.
To get basic driving skills, it's enough to start with driving an Opel. Exactly the same principle works with ECN accounts: a novice trader can open them, but it is not necessary to do it at the very beginning when there is no experience in trading yet. After all, a beginner, having gained experience, can always change the type of account or broker. Read more: Who are Market Makers and what are they doing on the market?
Advantages of ECN technologyECN brokers appeared not so long ago, in , but over these 20 years, they have become popular both among professional market participants and among those who are just taking the first steps in trading.
We can talk about the advantages of ECN brokers for a long time, but we suggest first highlighting three main advantages:Fast execution of transactions. No requotes. Low spreads. Often these three factors are enough for a trader to pay attention to companies with ECN technology when choosing a broker.
However, these are not the only reasons why it is worth choosing ECN brokers to work in the Forex market. It is equally important to understand how the broker earns. For example, the main difference between ECN companies is that their earnings consist exclusively of spreads - the commission that the trader pays for the execution of the transaction. That is, the broker is not interested in clients "draining" their deposit.
Also, ECN brokers do not participate in transactions. The company does not influence the trading process, does not set its own quotation indicators that would be beneficial to it, etc. There is no human factor in ECN technology, so customers get access to real market conditions, and the trader's transaction gets to the counterparty who currently has the most favorable quotes. As we have already said, ECN brokers cooperate with the world's largest liquidity providers, therefore, the level of liquidity of instruments in such companies is very high.
There is no option that a trader will buy an asset, and after a while will not be able to sell it. In addition, ECN companies, as a rule, provide services at the international level and assume a large trade turnover, so you can trade with them at any time of the day. Another advantage of ECN brokers as intermediaries between the market and the trader is the absence of restrictions. What does it mean?
The ECN company is not involved in the trading process, and traders' trading strategies are not displayed in any way on the broker's earnings, so cooperation with the ECN company assumes that a trader can use any trading strategy, as well as a variety of instruments. ECN brokers often allow the use of Expert Advisors and other software to automate the workflow in trading. Separately, we need to talk about the high speed of execution of transactions.
This factor becomes key if a trader is looking for a broker for scalping. And ECN brokers in this case become unequivocal favorites, because the trader, in addition to being able to use a scalping strategy, gets the highest possible transaction processing speed and access to instruments with good liquidity indicators.
Read more: Features of intraday trading on the Forex marketDisadvantages of ECN technologyWhen choosing a broker, it is important not only to pay attention to its advantages but also to know exactly what disadvantages it has. ECN accounts are no exception, because, despite many positive aspects, they also have a number of disadvantages.
These include:A high level of minimum depositECN brokers are often chosen by those traders who already have extensive experience in trading and who have built a trading strategy. They understand that ECN technology provides many advantages, and are willing to pay for them. Moreover, ECN brokers do not set the most affordable minimum deposit for traders. Difficulties in tradingIt is not so easy to make transactions using ECN technology. In order to trade and make a profit, a trader needs to understand the principles of ECN, as well as navigate the market, be able to respond to trends and sharp price changes, take into account the news release and analyze the market situation as a whole.
Technical analysis instruments can help with this, but they will not replace your own trading experience. Therefore, novice traders are advised to choose the demo version of an ECN account in order to gain experience and not risk their money, and only then proceed to real trading. Read more: ECN Forex account: what is it?
CommissionYes, ECN brokers earn income from spreads, but they can also include a separate, fixed commission per lot in the price list. At the same time, spreads are floating, their size depends on the market, and it is impossible to calculate exactly how much you need to pay the broker for the execution of the transaction. At the same time, it is definitely impossible to say that a floating spread is a disadvantage.
Professional traders know how to use this factor for their own good and reduce the size of commissions, but it will be quite difficult for a beginner to deal with it. After all, spreads can both narrow and expand in certain market conditions.
Whether to open an ECN account or not is not a rhetorical question at all. To understand if there is a need for it, it is enough to define your trading strategy and understand what conditions are important to you in order to achieve maximum efficiency in working on the Forex market.
May 18, IndexaCo. Practical advices on choosing a Forex broker for a beginner. The first task that every novice trader faces is choosing a broker. There are many companies on the market, but not every one of them is suitable to start your way in trading. Brokers that are suitable for beginners can be determined by a number of criteria.
We propose to analyze each of these criteria in order to learn once and for all how a novice trader can choose the first broker to trade on Forex. Broker selection criteria for novice tradersA novice trader should pay attention to the following criteria when choosing his first broker:reliability;deposit;types of accounts;instruments;methods of depositing and withdrawing funds;commissions;leverage;bonuses;training;support service.
Having correctly evaluated each of these criteria, any novice trader will be able to easily choose a broker. Read more: Forex risk hedging: why is it necessary? Reliability of a Forex brokerThis factor is equally important for both beginners and professionals.
Choosing a broker, first of all it is worth checking whether you can trust him. It is not difficult to do this - reliable companies have a license to provide services, they are registered and regulated by special authorities. The license can be either local issued on the territory of a particular country or international. To determine the country in which the broker is registered, it is enough to check the address of the main office: as a rule, it is in this country that the company is registered.
As for regulatory bodies, the more of them, the better for the trader. You can check the availability of a license, the registration address and the presence of regulatory authorities in the "About the company" section. Pay attention to the dates indicated in the last line: in most cases, you can use them to determine how long the broker has been providing services.
The exception is brokers who have rebranded and changed the site address, but they are rare. The longer the company exists, the more reliable it is. This information will help a novice trader distinguish time-tested companies from one-day scam brokers who receive money from clients, and then suddenly close, leaving the would-be trader with nothing. Talking about the safety of the client's capital.
In order to avoid worrying about this, we recommend choosing companies with segregated accounts. What is a segregated account? This is an account registered with a bank or other financial institution in the name of a client to which the brokerage company does not have access.
Thus, the trader can be sure that all his money will remain frozen and the broker will not use it for personal purposes. So, to choose a reliable broker, a beginner should focus on the following factors:Availability of registration and license. Which authorities regulate the broker's activities.
The term of the broker's work. Does the company offer segregated accounts. If you cannot find the information you need on the broker's website, we recommend contacting the support service and requesting the data you need before opening a real trading account in the company. Broker's minimum deposit amountThe first thing that novice traders focus on is the size of the minimum deposit. In other words, this is the minimum amount by which a trader can top up his account to start trading.
The lower it is, the more accessible the broker is. By the level of the minimum deposit set in the company, it is easy to determine whether the broker is suitable for novice traders. And this is logical - Forex trading involves risks, and the broker does not guarantee that the trader will earn and be able to "recapture" the invested funds. It is for this reason that Forex brokers for beginners set a low deposit level.
Each broker sets the minimum deposit amount independently. Read more: How much can you really earn on the Forex marketTypes of Forex trading accountsBeginners turn to this criteria much less often, and in vain: after all, trading conditions, in particular, the number of available instruments, services and free functions, may depend on the type of account. However, it is not necessary for beginners to check the trading conditions for each of the accounts offered by the broker.
At the beginning of the trading path, it is worth paying attention to two types of accounts:demo account;cent account. A demo account is a virtual account. With its help, novice traders can get their first experience in trading without risking their own money. It is worth noting that it will not be possible to make money on this account, its task is to give the trader the opportunity to practice and see the results of his actions, whether it is a virtual profit or a virtual loss. When the trader has gained his first experience on a demo account, you can move on to real trading.
In this matter, the best broker for beginners is a broker who has cent accounts. Their difference from a regular account is that the amount on deposit is calculated in cents. Accordingly, it is possible to trade on a cent account using tiny amounts, however, the amount of profit will also be small. A cent account is also considered a training account, however, unlike a demo account, it allows you to trade in real market conditions and monitor the psychological reactions of a trader to receive a real loss and profit.
Forex trading instruments and assetsThere are enough brokers on the market that offer a huge selection of instruments, but there are also companies in which the assortment consists of only assets. Which broker is better for a beginner? Both the one and the other. The number of trading instruments is not a key criterion when choosing a company, but it is still worth paying attention to. The fact is that a novice trader needs not only to gain experience in trading but also to understand which instrument he likes to work with the most and to assemble his own "inventory".
And this can be done only if the broker offers a fairly wide range of assets. This does not mean that you should choose a broker that will offer more instruments. The question, first of all, is diversity - it is important that the company offers not only currency pairs but also, for example, stocks, indices and metals. We advise you to focus on these criteria when choosing a broker. When trading currency, a trader buys or sells the currency that is indicated in the first pair GBP while paying the second USD and earns on the price difference.
There are both standard currency pairs and exotic ones, which include non-common currencies. Cryptocurrency is an extremely popular instrument, the benchmark of which is Bitcoin. This is an electronic currency that is not tied to any country, and you can earn it in different ways. For example, buy and sell on the same day, or buy and wait for its price to rise in order to sell the cryptocurrency more expensive.
Metals - this group includes gold, silver, copper and other metals according to the standard. CFD is a more complex instrument. Its specificity is the ability to trade on the price difference. It works like this: a trader does not need to buy an asset to make money. CFD is a contract between a trader and the owner of an asset, in which a trader can make a profit if the asset price increases from the moment of purchase, or a loss if the asset price falls.
How to manage your risk the easy way - Position Size Calculator. How to flip accounts real quick - Scaling In and Scaling Out. Chapter 9. Chapter Of course. Everything you need to know from start to finish is covered in the training videos, whether you are brand new to forex, or an experienced trader broadening your knowledge. You should start on a demo account first.
This is what I tell all my students, and as soon as you are profitable and ready, you can make a tryout at one of these prop trading firms out there, and trade big capital, without risking your own money. That's my goal for all my students. Yes, it's possible to get a refund. Disclaimer What is Fundamental Analysis? What Type of Trader do you want to be? Market Structure Chapter 2. Consolidating Structure Chapter 4. How to draw Horizontal Support and Resistance Chapter 5. How to identify Trends and Draw Trendlines.
Opening and closing of candles Chapter 2. What do these Candlestick Wicks mean? How to read Momentum? Everything you need to know about Candlesticks. Rising and Falling Channels Chapter 5. Triangles Chapter 6. Flag Patterns. How to use Moving Averages Chapter 3.
How to use the Fibonacci Retracement tool Chapter 4. How to use the Fibonacci Extension tool. Trend Continuation Strategy Chapter 2. Counter Trend Strategy Chapter 3. Money Management Formular Chapter 4. Confluence Intro Chapter 2.
Top Down Analysis Chapter 3. Journal your trades! Impulse levels 3. Reversal levels 4. Types of reversal levels 5. Impulses 6. Reversal moment 7. Total impulse level 8. Reversal Zone 9. Sharp trend reversal levels Consolidation Flat Flat The basic entry point
Trend Continuation Strategy Chapter 2. Counter Trend Strategy Chapter 3. Money Management Formular Chapter 4. Confluence Intro Chapter 2. Top Down Analysis Chapter 3. Journal your trades! Impulse levels 3. Reversal levels 4. Types of reversal levels 5. Impulses 6. Reversal moment 7. Total impulse level 8. Reversal Zone 9. Sharp trend reversal levels Consolidation Flat Flat The basic entry point Stop loss SL Safe method Second Chance Entry Breakthrough of the current movement Retest Risk Free Profit Acceleration Download Indicators Chapter 2.
Add Indicators to your MT4 Chapter 3. The 3 golden Rules Chapter 9. Position Size Calculator Chapter Classic Cars Chapter 2. Fast Cars Chapter 3. Most Expensive Homes Chapter 4. If you got too much money, buy one of these Chapter 5. Rollercoaster - Bucketlist Chapter 6.
Places to travel - Bucketlist Chapter 8. Most Expensive Luxury Hotels Chapter 9. Lost Places - Bucket list. Trade Trade 1. Trade 2. Trade 3. Trade 4. Trade 5. Trade 6. Trade 7. And if you figure it out, you can not only make good money, using your own funds, but also take substantial sums into management, trading with much lower risks, and getting your percentage of profit in the management process. Unfortunately or fortunately, but the truth is, what forex — it is not a golden grail or «magic button», allowing you to get rich in a couple of days or months.
This is really hard work, primarily psychologically, because the change in the stock chart is often accompanied by great stress, especially for beginners, when they see, how online price fluctuations change the size of their trading account. Under the influence of their own emotions, people begin to make spontaneous actions, including at the wrong time open and close transactions, resulting in large losses. So what exactly are the advantages of Forex over other types of earnings and business in general??
From the table below, it is seen, which, according to some basic criteria, Forex has a number of advantages over offline business. Continuing the topic of the psychology of exchange trading, one cannot fail to mention two very dangerous traps for the trader — it is fear and greed.
On Forex, fear most often manifests itself in situations, when a trader logically understands, what exactly is here, at this moment you need to enter into a deal, but emotionally afraid to do it. As a result, he misses a profitable opportunity and does not receive potential profit. Greed — this is the same common psychological condition, when a person overestimates his strength and seeks at all costs, in spite of the danger, get as much as possible.
In stock trading, greed is manifested in excessive self-confidence, neglecting obvious dangers of losing an existing profit or not closing a losing position. The result of greed at a certain stage may be hope.
This is another condition, when a trader is sitting and «prays», so that his profit grows or the deal turns in the right direction, if an unreasonable minus burns in the position opened by him. As mentioned above, fear and greed — this is just our psychological state.
But psychology, sometimes plays a trick on us. So that psychological aspects do not prevent us from working productively on the exchange, there is one main rule:. That is, open deals, when you have clear logical reasons for this and close them also, when your trading system received a clear signal. Before, how to enter a position, you must have a clear action plan, how and under what circumstances will you leave it.
This system is called trading strategy. We pass from the theoretical part to the practical. This step-by-step trading technology will help novice traders earn the first money in a minimum of time and become professional Forex professionals in the future. It makes no sense to practice right away, not knowing the basics, if you are going to do something new.
And the foreign exchange market is no exception. Start reading books on the subject of exchanges, Forex trading, fundamental and technical analysis. To begin, we recommend reading the following classic books on the topic, they will be especially relevant for beginners:. Also in YouTube and not only, you can find a wealth of information about, how to play forex, as well as interviews with analysts and practitioners of the foreign exchange market.
After that, how do you understand theory, you will need to go to the first purely practical step — Forex broker choice. Broker — this is a company, which allows you to carry out trading operations in the market. All transactions you can conduct on Forex only through a broker, as individuals cannot independently carry out trade operations here.
A reliable brokerage firm is required to have licenses to carry out this type of activity. To understand, how the forex market works, practice and not risk real money, we recommend you open a demo account. Its functionality is no different from the present. It is on a demo account that you can develop your own trading strategy, master the functionality of the trading platform and better understand yourself and your psychological characteristics.
In the previous paragraph, we already wrote, that one of the main goals of opening a demo account is to develop your own trading strategy. Trading strategy — this is a set of rules, by which you will open and close transactions, based on the criteria specified in it.
To develop a trading strategy, it is important to determine, at what time intervals will you trade. Some traders prefer to make dozens of transactions per day, and others vice versa — keep a position open for weeks and more than one approach is neither better nor worse than another. Trading strategy can be based both on technical analysis, so on fundamental. Sometimes it is possible to combine these two types of analysis.
When did you decide on your trading strategy, honed her and understood, that it makes a profit on an interval of at least, than 1 month a shorter period gives large errors , can go to the next step. Trading on a live account with your money — this is the most significant and exciting event for many novice traders. Work with real money involves a strong influence of the psychological factor, so do not be surprised, what is your strategy, working well on a demo account, crashes when working in real life.
But at the same time, your trade leaves much to be desired. This happens with almost all beginners. Volatility — this is an important financial indicator, which displays price volatility per unit time. On the price chart, it visually looks like the amplitude of the price her deviations.
Stop orders — these are applications for the purchase or sale of currency, which are triggered automatically when the price reaches a predetermined level. Stop orders are placed by the trader in advance and are usually part of his trading strategy. Real money trading, moreover, do not try to get rich quickly and show the market «who is the guru». You have opened a real account and are ready to rush into battle or as they say «in the pool with his head»?!
About risks and about, how to minimize them will be discussed later in the section of the article about risk management. You may have even more losing trades, than profitable, but, the amount of profit should ultimately be greater. Do you have one of them? We came up in an important block when working on exchanges — money risk management or as it is often called «money management», which literally translates as money management.
This is a set of fundamental rules, as to, how to distribute trading capital within transactions and what should be done, to avoid unplanned losses, as well as how to insure the existing profit from losses. Remember, that compliance with these 3 fundamental rules of risk management will bring your stability and profitability in the stock exchange game as quickly as possible.
You will learn how to set up a trading account · You will learn how to execute trades · You will learn successful strategies that are easy to implement · You will. Forex trading guide for beginners, everything you need to know about Forex in a simple way: base and quote, pips, leverage. The downfall of learning forex trading with a demo account alone is that you don't get to experience what it's like to have your hard-earned money on the line.