Forex Trading Basics

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The foreign exchange, or forex, market is relatively young, having begun in the early 1970s after the United States dropped the gold standard and national currencies started to fluctuate widely.

For about 30 years prior to that, most nations had agreed to keep their currency values stable in relation to the U.S. dollar, making a forex market unnecessary.

With that no longer the case, banks quickly realized that a profit could be made in “buying” currency when it was devalued and “selling” it after it strengthened, just like any other commodity.

Today, the forex market handles about $1.9 trillion in transactions every day, and it runs 24 hours a day, five days a week. (With nations around the world involved, it’s always daytime somewhere.)

The most traded currencies are the U.S. dollar, the euro, Japanese yen, British pound, Swiss franc and Australian dollar.

The forex market is overwhelmingly dominated by international banks, government banks, investment banks, corporations, and hedge funds. In fact, individual traders account for only about 2 percent of the market.

Nonetheless, a lot of people do try their hand at it, with varying degrees of success.

In the forex market, transactions are always handled in pairs: You buy one currency and sell another one.

The idea is to make a trade when you believe the currency you’re buying is going to go up in value compared to the one you’re selling.

Then, if it turns out your prediction was correct, you do another trade in the reverse direction -- selling the currency you originally bought and buying the one you sold -- in order to reap the profits.

For example, let’s say the market reports this: GBP/EUR 1.2200.

That means the cost of buying one British pound is 1.22 euros.

If you believed that course was going to change, and the euro was going to become more valuable than the pound, you might sell 100,000 pounds, buy 100,000 euros, and wait.

Then let’s say a few weeks later, the exchange rate fluctuates to this: EUR/GBP 1.3100.

Sure enough, the euro is now worth 1.31 pounds, a profit of 0.11 per unit.

The forex market is vast and daunting and mostly inhabited by giant organizations.

But it can be navigated by individuals who have studied the finer points and who want to take a risk on something potential profitable.

And since the whole world uses money, the trading of that money is always going to be a major force in the financial world.

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Is It Suitable For You To Trade Forex?

Being a forex trader: Is it for you?

Being a forex trader is not for the faint of heart.

The foreign exchange market is a fast-paced world that operates 24 hours a day, 5 and a half days a week.

For some traders, fortunes are made and lost very quickly.

Yet for someone with the right know-how and enough motivation and drive, forex trading can be rewarding both personally and financially.

How many people make their living as forex traders?

It’s hard to say for sure, but we know the number is smaller than the number of stock traders.

Most forex traders are actually international banks and other huge corporations; private citizens comprise only about 2 percent of the entire forex market.

Nonetheless, they are out there, and the number is growing.

As the Internet and other technological advancements make it more accessible, the forex market becomes more manageable and more average citizens become traders.

To begin with, most of these “day traders” keep their regular jobs and do forex as a side project.

It’s notoriously difficult to make a living as a forex trader at the start, and most new investors find they must allow for the learning curve before they’re really ready to do it full-time.

Once a new trader gets the hang of it, buying and selling currencies with some degree of confidence and turning a profit, he may find that he can quit his day job and focus on trading full-time.

There is certainly enough activity to fill a forex trader’s day, with news that could affect currency rates coming in almost constantly.

A smart trader watches this information continually, almost obsessively, always on the watch for a sign that the time is right to buy or sell.

With home computers and high-speed Internet service available nearly everywhere, being a trader from home has become feasible.

Some traders eventually become brokers, but the excitement -- and the potential profit -- lies in working for yourself.

With a stock market, a bad day could mean disaster.

But with the forex market, a bad day for one nation’s economy hardly matters, since there are still a dozen more strong, viable currencies to be traded. In that way, some consider being a forex trader slightly more stable than being a stock broker.

Either way, there is always risk when money and speculation are involved, but with dedication and resourcefulness, you can make a handsome living as a forex trader.

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Start your Forex journey with JustFxTrading

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Take Part In Forex Contests!

If you want to know how good your trading is, you can always take part in Forex contest help by various websites.

Recently, i took part in a forex contest organized by FX Pro.

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It only take a few minutes to register and every contest will have different time lenght.

Some would last 2 weeks while some goes on for a month.

For example, the one that I am in now goes on for the whole month of May 2013.

So, where can you find these contests?

You can find them in MyFxBook.com

Sign up with an account and you will be able to link MyFxBook to your trading account to see how your trading is fairing up.


At the time of this post, my position is at 304 out of 4234 competitors.

My account is up by 57.65%.
It is a long way behind the top guy who has registered a 7982.6% gain in just over week.

These high flyers are mostly trading Gold and Silver.

I checked them out of course :)

So why enter Forex Contents?

There is a prize money!

For this one, the winner will get $3000 funded into a FX Pro account.
So, to get the money, you need to register as a FX Pro user. Of course, you can trade with the money or withdraw it out after 1 day.

Pretty good huh... You can practice and win money at the same time.

The 2nd place will get a $2000 account and 3rd will win a $1000 account.

So, if you come across any forex contest out there, you can simply join the contest to see how well you perform againts traders from all over the world.

So, wish me luck.

Stop Losing Money In Forex!  Start Winning Consistently With THIS SYSTEM. CLICK HERE

Start your Forex journey with JustFxTrading

Get The Freedom You Always Dream Of!


Happy Trading!!!

Your Forex Trading Strategy Is Everything

A good forex trading strategy can mean the difference between failure and success.

No sane person would jump into the forex market blindly.

You might as well set your money on fire if that’s what you’re going to do.

Sensible investors study the market carefully first, learn the ins and outs of currency trading -- and even then, before they launch into it, they devise a smart forex trading strategy.

The market is constantly changing and is not always predictable, true.

But you still need a strategy, one that allows for unknowns and surprises.

Your strategy should begin with how much money you can afford to lose.

That may sound like a negative outlook -- after all, the goal is to MAKE money, not lose it -- but common sense tells you that the forex market is a gamble.

There are precautions you can take that will make you less likely to lose your initial investment, but there’s no way to guarantee it.

Your strategy must allow for the possibility that you’ll take a bath, and for that reason you should never invest more than you can afford to lose.

Another good tip for your trading strategy is to avoid putting all your investments in one currency.

What’s the old saying about eggs and baskets? Yeah, don’t put ‘em all in one.

Spreading them out makes it much, much less likely that you’ll be wiped out, the way you would if you relied on one currency and it bottomed out.

As you prepare your trading strategy, make yourself aware of what the market is doing right now.

Is it trending upward, or downward? What’s the general mood among traders? They all have a strategy, too, and are eager to know what others are thinking.

Consider also what your timeline is.

How long do you want to stay in the market before taking your profits and getting out?

Your strategy must also involve learning the timing of the business.

Timing is everything: Too late or too early and your potential profit evaporates. As you learn to gauge the market and make trades at just the right time, your profits will increase.

A good strategy will factor in this learning curve and allow for a few mistakes at first.

Above all, to prepared to accept surprises when it comes to forex trading.

Strategy can only get you so far. The rest is ingenuity and a little bit of luck.

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Start your Forex journey with JustFxTrading

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Happy Trading!!!

Forex Demo: Always Trade Demo Account Before Trading Live Acount

Before airplane pilots actually fly on their own, they usually practice in simulators that re-create what flying will be like without any actual risk.

Since currency trading is as dangerous financially as flying is physically, it makes sense that there would be a forex demo available, too.

A forex demo is a smart way for a new investor to start.

Reading books and taking online courses can teach you the basics, but the best way to learn anything is to get some hands-on experience.

However, with forex, hands-on experience could mean losing your shirt.

So a demo gives you real-world training with no actual money being involved.

Usually, the demonstration comes courtesy of a brokerage or other financial Web site that has an interest in currying your favor.

The plan is that once you’ve tested your skills in the demo, you’ll get into the real thing and take advantage of the paid services the demo provider has to offer -- forex signals, managed accounts, automated trading, etc.

The demo is like a free sample, offered in the hopes that you’ll enjoy it so much that you buy something, too.

For that reason, be should be highly suspicious of any

Web site that wants to charge for a demo.

Considering there are literally dozens of sites that offer free demonstrations, there is absolutely no reason that you should pay for it.

When you sign up for a forex demo, you’re given a username and password and shown how to use the demo system.

Sometimes it involves downloading a piece of software unique to the company; other times it’s simply done over the Internet.
(Some demos require Macromedia Flash, which most browsers have installed, but which you’ll need the latest version of.)

You determine how much imaginary money you want to start with, and off you go!

Once you’re signed in to the forex demo, you do all the things you would do if it were a real-world situation: reading the charts, following the trends, visiting online forums to get other traders’ opinions, and making trades.

The trades are recorded in the forex demo only and don’t go anywhere into the actual market since there’s no real money involved.

When the market changes, the program determines how much you’d have gained or lost based on the decisions you made.

You’re able to say, “Whew! Good thing this was only for practice!” or “Too bad this wasn’t real!” And once you’ve gained some expertise using the forex demo, you can move on to the real thing and start making some money for real.

Stop Losing Money In Forex!  Start Winning Consistently With THIS SYSTEM. CLICK HERE

Start your Forex journey with JustFxTrading

Get The Freedom You Always Dream Of!


Happy Trading!!!