This article is intended for beginners in the field of foreign exchange transactions. Here we will very briefly look at what Forex is for beginners and what are its basics of work.
The success of trading in the Forex market is the main goal that every trader should be guided by. To achieve the maximum effect from it, it is necessary, first of all, to spend your time studying the market itself, methods of analysis for beginners and the basics of trading on it. You also need maximum commitment. Do not be worth the hopes that you will be able to earn your money quickly and without much difficulty, because the Forex market is too volatile by its nature.
Most novice traders are mistaken on the game with exchange rates. You should not be upset about this, as it is not only peculiar to them, but also to experienced traders. Therefore, to minimize the risks of losing your funds and maximize profits from trading on the market, you should make only balanced decisions, and this rule applies to all exchange markets . These decisions should be based on the competent knowledge of technical information, the ability to predict and the right timing for bidding.
Remember, an experienced Forex trader never gives up if he is burnt on the market. He always analyzes his mistakes made during the bidding process, and continues to work, considering them in the following operations in the Forex market.
First of all, we need to investigate his condition. At this stage, information is collected about how stable the market is, where its movement is directed (up or down), whether it is within the normal range, what stage of development it is at. Possession of this information will lay a solid foundation for successful transactions.
Remember, the trend is your friend. Some traders invest money when the trend moves in the opposite direction, in the hope that they will be able to earn income later. Nevertheless, for a novice investor, such a strategy is very dangerous.
Now let’s talk about the risks. Before you make a particular operation in the market, you need to assess its risk. If you are not sure about the success of this transaction, then it is better to postpone its implementation for the future. This will save you from meaningless loss of funds.
We define the timing of trading. Most novice traders, entering into trades, do not think about when they need to close. And it is in vain, since a change in price over a certain period of time can either play into your hands or bring you at a loss. Therefore, it is necessary to determine the tactics of behavior on the market. Will you have it short-term, or will you carry out your transactions based on a long-term strategy . After that, you can determine which type of graph you need.
If you carry out your transactions on the market several times a day, then there is no need for a daily schedule. It is best to trade based on data from thirty-minute or hourly charts. It is also important to take into account the time periods between the opening and closing of trading at various world financial centers, since this factor affects the volatility and activity of this market.
Of course, you can invest all your funds and get a big profit from the operations, but there is also a high probability that you will lose them. Therefore, the scaling of trading volumes and the implementation of operations with different types of currencies would be the best option.
The next thing you need to pay attention to is the time of the release of the main economic indicators of the leading countries of the world, as well as various events in the financial, economic, social and other fields. Although it is mainly applicable to news of a catastrophic or global nature, such as the events of September 11, the beginning of the war, and the like. Do not think that, having learned any fresh news, you will be able to get ahead of the market and quickly have time to make the right bets. Surely the big Forex players already have this information and have taken appropriate measures. Although, quite often it happens that the market evaluates any news with a delay, or there is an inadequate assessment of it at all, and just the opposite of what one would expect.
Forex trading for new traders may seem like something completely incomprehensible and very difficult – this is actually the case. However, after a certain time, it becomes obvious that this happens only at the initial stage.
And in conclusion, I want to say that if you adhere to these rules of behavior in the Forex market, you can probably become a successful trader.