Currency trading, a.k.a. Forex trading involves dealing in foreign exchange currencies, usually in currency pairs. The goal is to use the difference between the price of one currency as opposed to another and as a whole. Much like any other enterprise, if you want to be good at and make profits via Forex then you need to cover all your bases.
Currency Trading: Cover your Basics
This means going beyond the definition of terms, reading about Forex strategies, charts, indicators, etc. Rather it is about proper diligence in reading essential materials and perseverance in achieving training and experience. Nowadays it is not even necessary that you attend a “regular school”. This is because you can actually enroll into online courses that will provide you with a graduate diploma all the same. For those who only want to moonlight as Forex brokers it is highly advised that you attend online courses but if this is not possible then you have to at least purchase quality e-books and read them diligently.
Regular classes and online courses will provide you with ways to get actual training and experience. An alternative to this is to enroll in Forex accounts that have practice Forex accounts. This is where you simulate actual trades using actual data and even real time market values but with dummy money.
Currency Trading: Decide on your Currency Pair
There are numerous currencies and currency pairs to work with however it is best for part time brokers or even new traders to specialize in one or two currency pairs. This is because each trade is made only after careful scrutiny of a deluge of raw data coming from Forex feeds as well as mass media.
Currency Trading: Long Term or Short Term
Most beginners want to get into the action right away, hence they trade in the short term. This means they buy and sell currency pairs dozens of times every trading day. Now there are a lot of online sources that says this is the way to go about it, and they are not necessarily wrong. What is important to remember is that short term trading will increase your chances of profits per trade but it also increases your losses per trade. And short-term trades usually involve less amount of money and profits.
Long-term trades on the other hand involve carefully selecting your currency pairs and then meticulously rifling thru raw data, various analysis, expert opinions, news of the day, etc. in order to determine whether or not you will move or stay put. The disadvantage to this type of trading is that it usually involves large sums of money to be profitable and that profits are spaced far from each other, albeit profits made are usually bigger.
Currency Trading: Get your License or Hire a Broker
If you want to make this a full time job then you need to get your license. This is in order to remove the middlemen and the broker out of the equation. However if you are only moonlighting as a trader then you need to hire a Forex trader and or a broker. The former does your trade for you the latter provides you with the list of trades.
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