Part-time Trading - Part 4.1

As promised before we are going to learn about Price Patterns. We are going to place our trades on the support / resistance with the help of these price patterns. These Price Patters are nothing but the Candle-stick formation.

What are Candlesticks?
Candlesticks are used to describe the price action during the given time frame.
Candlesticks are formed using the open, high, low, and close of the chosen time period.

• If the close is above the open, then a green candlestick (usually displayed as green or white) is drawn.
• If the close is below the open, then a red candlestick (usually displayed as red or black) is drawn.
• The red or green section of the candlestick is called the "real body" or body.
• The thin lines poking above and below the body display the high/low range and are called shadows or wicks.
• The top of the upper shadow is the "high".
• The bottom of the lower shadow is the "low".

That's all for now. Let us continue about the Price patters in the next post.

Part-time Trading - Part 4

I promised you I will write about the price action in this post. But before going there, let us talk about something else.


What we do in the weekends when there is no trading? 
In the weekend we prepare ourselves for the coming week by doing some research on all the pairs that we are going to trade. This may take around half an hour to one hour if you choose to trade 28 pair (the best for trading). This is the best time to do your research as the markets are close, there is time for you to go through each currency pair personally. You can choose any day of the weekends (Saturday or Sunday) and any time. In this time you are going to check the currency pairs on different time frames (M, W, D) and most important thing is, you will be getting ready for the coming week. This is important because, this will minimise the time you are going to spend on the week days for trading.


Currency Pairs:
There are different currency pairs to trade. But you must choice the ones which suits you in different ways. The main currencies which are most heavily traded are - USD, EUR, GBP, JPY, CAD, AUD, NZD & CHF. So you are going to concentrate on theses heavily traded currencies in pairs (EUR/USD, GBP/USD, USD/CAD, USD/JPY, AUD/USD, NZD/USD, USD/CHF, EUR/GBP, EUR/JPY, GBP/JPY etc. You can get 28 pairs.) But for some of you, you will not get all the pairs you want to trade. So you can select the ones with  lower spread (The spread is the amount of pips between the bidding price and the asking price is called the spread. The spread is what forex brokers use to make money on every forex trade placed through their network. For example, the forex broker may be paying a price of 1.3600 for buying or selling. The broker will then allow you to buy the currency for 1.3601 or sell it for 1.3599. The spread always stays around the actual price that the forex broker is paying. So when you buy, you get one end of the spread and when you sell you get the other end of it, and vice versa. By the time you close your trade, you will have always paid the spread.), more conservative pairs.


What we actually do on the weekends is go through the charts of each currency pair we want to trade (usually 28 pairs). First we remove all the lines we drew before. We start with EUR/USD monthly chart.

In the above picture what we see is EUR/USD on monthly time frame. What we see there?

What we see in the above picture is there are few support and resistance lines. I know there is one more in the extreme bottom - I didn't mark it because it is very far at the moment from the current price and I don't want to make my chart too crowded. You can see that the price is nowhere near the S/R. So let us move to weekly chart for the same pair.



In the above picture, you can see a beautiful Trend-line, Few Support and Resistance. Can can see a trade forming around 1.334 with the trend line. But there is also a resistance which was broken up-side before. As you already know, Horizontal line give better quality signal than trend-lines, Let us watch and see the price pattern (I will write regarding price action in my next post) and accordingly we will place the trade. Now let us go to daily chart.

In the above chart what we see is EUR/USD on daily chart we have our trend line, S/R also. But look closely. the price is not very near any of them. So what we do is, wait for the right opportunity either the price has to move up near the resistance/trendline or near the support  so that we get a valid trade set-up.


So the same thing we do with all the other currency pairs we want to trade. We start from monthly time frame, weekly then daily and draw out lines. Some times, we may not have any trades at all. 


Important thing is we maintain a trading dairy. We must note down what we observed on our weekend research. We must note down if we are waiting for any future trades on particular currency pair. This will be helpful for us in the week days and save us a lot of time. (For example: in the above research on EUR/USD, we observed that, there are no trades on monthly time frame. But on weekly there is an opportunity. On daily time frame, well not right now. But there is more movement in daily. So we may get in future as the price is not very far from support/resistance.).

I hope this was helpful.

Part-time Trading - Part 3.3

Basic Principles of Support and Resistance Trading:

1. You need a clear Market Direction
2. Avoid Alien Zone
3. Search for highways
4. Follow the Trend
5. Always remember Long-term trading is better than Short-term trading.
6. Use proper time frame
7. Horizontal S/R is better than Diagonal lines (trend lines)
8. Don't try hard to find a trade. If you don't find it, it is not there.

You need a clear Market Direction:
Please make sure the direction of the market before taking any trade. Always remember there are only 2 possibilities. {For example: If you have an up-trend you can search for either continuation moves (up) or breakout (down)}.The same thing goes with range boundaries.

Avoid Alien Zone:
The Alien Zone what I call is when the price is very far from the S/R levels. If the price is nowhere near the support or resistance, stay out of it as there is no clear direction.

Search for Highways:
Search for highways free of traffic. Here traffic jam represent the support / resistance. If you are driving in a highway with plenty of cars (horizontal & diagonal lines of support / resistance) it is just painful to drive (take trade on those charts) as there is lot of confusion. Likewise wait for the price to show you a clear direction and trade where there is more room for your trades.

Follow the Trend:
This is very important. Buy of support and sell of resistance. {For example: if you have an up-trend and has a resistance line drawn before, if the prices breaks upwards and follows the trend, wait for the price to retest the support (former resistance) then buy of support line or if the price breaks below the support (former resistance will be stronger and again acts as resistance) then sell of the resistance}.Don't sell of support and buy of resistance. Specially you must not sell against long term support or buy against long term resistance.

Long-term trading is better than Short-term trading:
If you get two trading signals on different time frames, always remember long time frames are better and safer to trade than the short term time frame charts. This is very effective for your win/loss ratio.

 Use proper time frame:
You have to search for the price patterns (you will know about this in next post) in the same time frame where you drew your Support/Resistance. If you have your S/R on Monthly time frame, don't try to enter your trade based on Daily or weekly time frame just to sharpen your entries. That is called micro-managing your trades, which are most of the times, fake entries end up in losses. Wait for the proper time entry point on proper time frames. The sharper the S/R the better.

Horizontal S/R is better than Diagonal lines (trend lines):
As a trading set-up, the signal you get from horizontal lines of S/R is of higher quality than that you get from diagonal lines (trend lines). But it doesn't mean that you can consider diagonal lines as bad set-ups. If you get two signals on one pair, one each from horizontal line and diagonal line, you better go for horizontal line S/R as the quality is better.

Don't try hard to find a trade. If you don't find it, it is not there:
Be Selective of your trading set-ups. If you don't find it, it is not there. Don't try too hard to find a trade just for the sake you want to trade. Wait for a good quality set-ups and pick the proper charts to place the trades for better win/loss ratio.

That's all for now. In the next post we will talk about price patters which you want to trade on the Support or Resistance.

Part-time Trading - Part 3.2

Hello,

Yesterday we discussed about how to draw support / resistance, trend-line, range boundaries & Fibonacci retracements. Few of you who checked the post through email, didn't get the chance to go through the video regarding Fibonacci retracements. Please click here to check the same.

In the mean time, let us have a look at an example of support lines and trend-line in real time charts.

In the above picture you can see GBP/USD daily chart, on a up-trend. The diagonal line I have drawn in blue is the trend line. The green horizontal lines are the support lines. The red horizontal lines are resistance lines. You can also see that I have marked some circles. The blue circles (you will not draw them on your actual chart, it is only for information purpose) shows exactly where the trend line have been marked. The red circle shows the previous swing low where the trend line was marked before. I know I have drawn lot of lines there, they are only for Information purpose. In the real trading, I will not draw so many lines because as I said earlier I don't like my charts look ugly and confusing.

We will see one example of Fibonacci retracements:

In the above picture you can see AUD/USD monthly chart. You can also see that the price was in a good up-trend and it went down to 38% Fibonacci and bounced back upwards.

 

The above picture, you can see the same pair on the same time frame. But here we have to wait for the price to move downwards between 38% to 61% to bounce back so that we can have a valid trade.

Let us look one example of Range Boundaries:

In the above picture you can see USD/CAD on daily time frame. It was a beautiful Range boundary formation there.

I hope you will do your own exercise to understand how to draw these important lines.

That's all for now.
Have a nice day.

Part-time Trading - Part 3

Hello

Yesterday we learnt the the important factor for successful part-time trading is long term support / resistance and price action around that that support and resistance.

Today we are going to learn how to draw those key levels of support / resistance in the long term charts (daily, weekly & monthly time frames)

The trades we are going to look for are, bounce trades, continuation trades or breakout trades.

Support / Resistance (S/R): when you look into the charts, you will see many swings (zig- zag patterns), but you are not going to draw lines for all those highs and lows of the charts but only to the significant highs and lows. Please note not to make the mistake of drawing too many lines as the chart looks ugly (*_*).

If you have two swing points to join together to draw a line then it is a stronger support / resistance (also known as double tops or double bottoms).

Trend-lines: You can only draw trend line (diagonal line) only if you get two swing points in the direction of the trend. If the trend line is below the price then it is up-trend line and if the trend line is above the price then it is the down-trend line. But always keep in mind the trend lines should begin from the very beginning of the new trend. Also you can draw only outer trend lines of a trend.

In both the cases (trend line or simple horizontal S/R line) wait for the price to move towards the lines and based on the price pattern (You will know about it in future posts) you are going to place your trades (entries).

Range Boundaries: Now let us talk about the Range Boundaries. Range Boundaries or Ranges are the price conjunction between the two boundaries or support or resistance. These Ranges can take horizontal levels of support or resistance or triangular shape (One S/R and the other trend-line). But the good quality ranges are horizontal ranges.

Fibonacci Retracements: One more type of drawing the lines are Fibonacci Retracements. There are plenty of videos who show you how to draw Fibonacci Retracements on your charts. But please remember we concentrate only on 38% to 61% area of this Fibonacci Retracements for the REVERSAL so that we can trade in the direction of the trend. Please note that Fibonacci Retracements are only valid on trending in one single direction. If there is no clear trend or swing in the direction of the trend, then there is no valid trade. Please go through the video.



That's all for now.

Good night.

Part-time Trading - Part 2

I hope you realised that part-time trading is not as stressful as intra-day trading and much more pleasant experience.

Important factor to succeed in part-time trading is:
Support / Resistance and Price action - especially LONG TERM support / resistance and price action around that support / resistance

What we do is to wait for the price to move towards the support or resistance (S/R) in the chart. Depending on the price reaction near the key levels (S/R) we are going to trade (Buy/Sell) always in the direction of the market reaction.

If the price is moving up (uptrend / bulls), it reaches a top of that trend & then it collapses down (bear), that swing high we mark as resistance level. After few days (daily time frame) or week (in weekly chart), if the price again moves upwards towards that resistance, we look for a trade either to sell or buy depending on the price formation.

Conclusion: we draw support or resistance (level) lines in our charts (daily / weekly or monthly) and WAIT for the price to move towards our levels either to breakout or bounce to place our respective entry trades. as simple as that.

Part-Time Trading - Part 1

Even though, Intra-day trading sound exciting and more fun, Part-time trading is much easier way of trading Forex. Let me tell you why.

1. It is easier to search the trade.
2. As we use long term charts (daily, weekly & monthly), the movement of chart is slow. So if you find a trade you don't have to worry about the trade as much as you do in intra-day trading. In intra-day trading, you have to make decisions quickly (in fraction of a second when you get a signal) to place trades and also to exit. Where as in part-time trading, you have plenty of time to take a trade and to manage it.
3. It is as much profitable as intra-day trading, it is more efficient with less effort.
4. Intra-day Trading carries a higher degree of risk than part-time trading because, in intra-day trading, the signals you get are of lower quality because you are using smaller time frame charts, price is volatile, validity of the signals will be very less.

Please click here know about basic concepts of Forex.
Please click here to get the user guide of the chart of my favourite broker.
Please click here to know how to draw lines (support & resistance) on the chart.

Part-Time Trading - Introduction

Hello Everybody,

Welcome to our new session of Trading. I hope you have opened the demo account with my favourite broker. As you all know the market is closed for the weekend, you can trade again on Monday (can't just wait to trade).

There are different types of trading, few of them I mentioned in my previous post. Few of them I didn't mention are Carry Trade, Range Trading, Trend Trading, Swing Trading, Counter-Trend Trading etc.. I mainly concentrate on few that I mentioned in my previous posts.

Part-Time Trading:
This type of trading is suitable for almost everybody, especially for those who have a full time job. You need around 30 minutes a day to trade.
In this type of trading, we concentrate on long term charts. If you check the market scope (chart), There are different time frames, we concentrate on daily, weekly and monthly charts.
In this type of trading we look for 200 to 250 pips per trade and around 8 to 10 trades per month, that's right you will not have trades everyday.
If you have a mini account,  200 pips = $ 200/- (EUR/USD) x 8 trades = $ 1,600/month
If you have a micro account, 200 pips = $ 20/- (EUR/USD) x 8 trades = $ 160/month
If you have a standard account, 200 pips = $ 2,000/- (EUR/USD) x 8 trades = $ 16,000/ month.

Now you realised Part-time trading is also a profitable type of trading.
That's all for now.

Please don't forget to visit my Blog PipBase for the older posts, in case if you have missed any.

Forex Trading

Hello There,

Enough of that boring theory Stuff. Now you know what is Forex, Trading, Forex Market, let us concentrate on real Trading.

There are different types of Forex Trading.

1.     Long term Trading

2.     Intraday Trading

3.     News Trading

4.     Part-Time Trading

5.     Scalping

Glossary of Terms

American-style option – An option contract that may be exercised at any time before it expires.

Ask – The quoted price at which a customer can buy a currency pair.  Also referred to as the ‘offer,’ ‘ask price,’ or ‘ask rate.’

Base Currency – For foreign exchange trading, currencies are quoted in terms of a currency pair. The first currency in the pair is the base currency. For example, in a USD/JPY currency pair, the US dollar is the base currency. Also may be referred to as the primary currency.

Bid – The quoted price where a customer can sell a currency pair. Also known as the 'bid price' or 'bid rate.'

Bid/Ask Spread – The point difference between the bid and ask (offer) price.

Currency pair – The two currencies that make up a foreign exchange rate. For example, USD/YEN is a currency pair.

Dealer – A firm in the business of acting as a counterparty to foreign currency transactions.

European-style option – An option contract that can be exercised only on or near its expiration date.

Expiration – This is the last day on which an option may either be exercised or offset.

Interbank market – A loose network of currency transactions negotiated between financial institutions and other large companies.

Leverage – The ability to control large dollar amount of a commodity with a comparatively small amount of capital.  Also known as ‘gearing.’

Margin – See Security Deposit.

Offer – See Ask.

Open position – Any transaction that has not been closed out by a corresponding opposite transaction.

Quote currency – The second currency in a currency pair is referred to as the quote currency. For example, in a USD/JPY currency pair, the Japanese yen is the quote currency. Also referred to as the secondary currency or the counter currency.

Rollover – The process of extending the settlement date on an open position by rolling it over to the next settlement date.

Security deposit – The amount of money needed to open or maintain a position. Also known as ‘margin.’

Settlement – The actual delivery of currencies made on the maturity date of a trade.

Spread – The point difference between the ask and bid price of a currency pair.

Trader – An individual who is on the other side of the trade with the dealer and whose objective is to profit from price movements.

The risks of forex trading

Forex trading carries a high level of risk. Take a minute to go through some of those risks.

·         The market could move against you. Fluctuations in the foreign exchange rate between the time you place a trade and the time you close it out will affect the price of your forex contract and the potential profit and losses relating to it.

·         You could lose your entire investment. As mentioned earlier, leverage allows you to hold a large forex position with a relatively small amount of money. If the price moves in an unfavourable direction, high leverage can produce large losses in relation to your initial deposit. In fact, even a small move against your position may result in a large loss, including the loss of your entire deposit. Depending on your agreement with your dealer, you may also be required to pay additional losses.

·         Retail off-exchange forex trades are not guaranteed by a clearing organization. Furthermore, funds that you have deposited to trade forex contracts are not insured and may not receive a priority in bankruptcy. Even customer funds deposited by a dealer in an FDIC-insured bank account may not be protected if the dealer goes bankrupt. Be wary of firms that say “Your investment is protected” or “Your funds are segregated.”

·         Unlike regulated futures exchanges, in the retail off-exchange forex market there is no central marketplace. The forex dealer determines the execution price, so you are relying on the dealer to give you a fair price.

·         If you are using an Internet-based or other electronic system to place trades, some part of the system could fail. In the event of a system failure, it is possible that, for a certain time period, you may not be able to enter new orders, execute existing orders, or modify or cancel orders that were previously entered. A system failure may also result in loss of orders or order priority.

·         As with any investment, you should protect yourself against fraud. Over the last few years, there has been a sharp rise in foreign currency scams, and you should do as much due diligence as you can before trading forex.

        

·         Here are some tips to help you avoid becoming a victim of a forex scam.

·         Stay away from opportunities that sound too good to be true. In general, get-rich-quick schemes tend to be frauds. For example, avoid any forex company that predicts or guarantees large profits. If a company says that they will double or triple your money in one month or will guarantee a monthly return, walk away.

·         Stay away from forex companies that promise little or no financial risk. There is no doubt that trading forex is risky, so if someone is telling you the opposite, they are not being truthful. Beware of forex companies that make the following types of statements: “Whichever way the market moves, you can’t lose” or “While there is risk, it is substantially outweighed by the reward.”

·         Check the background of everyone you will be dealing with. If you cannot satisfy yourself that the persons are completely legitimate and above-board, the wisest course of action is to avoid trading through those companies.

A good place to start checking the background of a forex firm or individual is NFA’s Background Affiliation Status Information Center, or BASIC. It’s available through NFA’s Web site and contains the registration and disciplinary records for individuals and companies involved in the futures industry. Although some forex companies and brokers are not required to be registered with NFA, BASIC ( http://www.nfa.futures.org/ ) is a good place to start to determine if a broker or company has any past industry experience.

If you suspect any wrongdoing or improper business conduct in your forex account, you may contact or file a complaint with NFA by telephone at 800-621-3750 or online at www.nfa.futures.org.

How does LEVERAGE impact Forex Trading?

Off-exchange foreign currency trading carries a high level of risk and may not be suitable for all customers. The only funds that should ever be used to speculate in foreign currency trading, or any type of highly speculative investment, are funds that represent risk capital; in other words, funds you can afford to lose without affecting your financial situation.

Let’s proceed on the assumption that you have risk capital you would like to use in trading forex. The next question is how much you need to open an account. Forex dealers can set their own minimum account sizes, so you will have to ask the dealer how much money you must put up to begin trading.

Most dealers will also require you to have a certain amount of money in your account for each transaction. This security deposit, sometimes called margin, is a percentage of the transaction value and may be different for different currencies. Keep in mind that a security deposit acts as a performance bond and is not a down payment or partial payment for the transaction.

Let’s use an example of a dealer requiring a 1% security deposit. The formula for calculating the security deposit is:

The current price of the base currency X transaction size X security deposit % = security deposit requirement given in quote currency

Looking at the Euro example we used earlier, multiply the current price of the base currency ($1.4050) times the transaction size of 100,000 times 1%. Your security deposit would be $1,405.00.

$1.4050 X 100,000 X .01 = $1,405.00

Security deposits allow customers to control transactions with a value many times larger than the funds in their accounts. In the previous example, $1,405.00 would control $140,500 worth of Euros.

This ability to control a large amount of one currency using a very small percentage of its value is called leverage. In our example, the leverage is 100:1 because the security deposit controls Euros worth 100 times the amount of the deposit.

Since leverage allows you to control large amounts of currency for a very small amount, it magnifies the percentage amount of your profits and losses. A profit or loss of $1,405.00 on the euro transaction is 1% of the full price but is 100% of the 1% security deposit.

The higher the leverage, the more likely you are to lose your entire investment if exchange rates go down when you expect them to go up or go up when you expect them to go down. Leverage of 100:1 means that you will lose your security deposit when the currency loses or gains 1% of its value, and you will lose more than your security deposit if the currency loses or gains more than 1% of its value. If you want to keep the position open, you may have to deposit additional funds to maintain a 1% security deposit.

For example, assume you buy or sell a contract worth $100,000 and it moves against you by $2,000. No matter how much money you put up, your dollar loss will always be the same—$2,000—but the percentage loss varies with the amount of leverage. At 100:4 leverage, you will have lost half of your investment. At 100:2 leverage, you will have lost your entire investment. And at 100:1 leverage, you will have lost twice your investment and owe the dealer $1,000.

Notional value = $100,000        Loss = $2,000                                       

           

Original Investment             Leverage       Remaining Funds   Loss

$4,000                                    100:4              $2,000                        50%

$2,000                                    100:2              $0                               100%

$1,000                                    100:1              -$1,000                      

You should check your Account Agreement with the dealer to see if the Agreement limits your losses. Some dealers guarantee that you will not lose more than you invest, which includes both the initial deposit and any subsequent deposits to keep the position open. Other dealers may charge you for losses that are greater than your investment.200%

Your Account Agreement with your dealer is crucial. Just as you wouldn’t consider buying a house or a car without carefully reading and understanding the terms of the sale, neither should you establish a forex account without first reading and understanding the Account Agreement and all other documents supplied by your dealer. You should know your rights and responsibilities, as well as the firm’s obligations before you enter into any forex transaction.

In the case of a $100,000 position with 100:1 leverage, the customer would have been required to post a security deposit equal to 1% of the position value. In this case, the security deposit would have been $1,000 ($100,000 X .01). A 1,000 US dollar decline in the value of the position would have completely wiped out the security deposit.

How are foreign currencies quoted and priced?

Currencies are designated by three-letter symbols. The standard symbols for some of the most commonly traded currencies are:

EUR - Euro

USD - United States Dollar

CAD - Canadian Dollar

GBP - British Pound

JPY - Japanese Yen

AUD - Australian Dollar

CHF - Swiss Franc
NZD - Newzealand Dollar

Currency pairs are often quoted as bid-ask spreads. The first part of the quote is the amount of the quote currency you will receive in exchange for one unit of the base currency (the bid price). The second part of the quote is the amount of the quote currency you must spend for one unit of the base currency (the ask or offer price). For example, a EUR/USD spread of 1.4050/1.4055 means that you can sell one Euro for $1.4050 and buy one Euro for $1.4055. This spread could also be quoted as 1.4050/55.

At first glance, the bid and ask prices may seem backwards to you. That is because they are listed from the dealer’s point of view, not from your point of view. The first part of the spread, or the bid, is what the dealer is willing to pay to buy the base currency. So this is the price you will get if you SELL the base currency. In the same way, the second part of the spread, or the ask, is what the dealer is willing to sell the base currency at, so this is the price you will get if you BUY the base currency.

Example:

If the USD/CHF spread is listed as 0.9975/0.9980, you can sell one US dollar for 0.9975 Swiss francs and buy one US dollar for 0.9980 Swiss francs.

*********

Exercise . 1:

In this currency pair, which is the base currency?

AUD/USD

The answer is the Australian Dollar, or AUD. Remember, the first currency in a currency pair is the base currency and the second currency is the quote currency.

Exercise . 2:

Using this USD/JPY spread (114.45/114.55), how many Japanese yen would it take to buy one US dollar?

It would take 114.55 yen to purchase one US dollar.

_____________________________________

Who determines the execution price—the trader, the dealer or the exchange?

It is the dealer. Remember that the forex markets we are discussing have no central exchange on which the contracts are traded, and you as the trader have no control over the execution price.

What are Foreign Currency Exchange Rates?

Let me start with a definition of foreign currency exchange rates. Foreign currency exchange rates are what it costs to exchange one country’s currency for another country’s currency.

Let us take an example, if you go to USA on vacation, you will have to pay for your hotel, meals, admissions fees, souvenirs and other expenses in US Dollars. Since your money is all in British Pounds, you will have to sell some of your British Pounds to buy Dollars. Similarly if you were living in Switzerland and planned a vacation in the United States, you will have to buy US dollars with Swiss Francs (You have to sell Swiss Francs).

You can convert the exchange rate for buying a currency to the exchange rate for selling a currency, and vice versa, by dividing 1 by the known rate. For example, if the exchange rate was 1.400, how many U.S. dollars would you get for your 1,000 Euros? You would receive US $1,400.00 for your 1,000 Euros.

In other words, one divided by .5988 equals 1.6700. Similarly, if the exchange rate for buying US dollars with British pounds is 1.6700, the exchange rate for buying British pounds with US dollars is .5988 (or one divided by 1.78536 equals .56011). This is how newspapers often report currency exchange rates.

You should know, however, that you will not receive the price quoted in the newspaper if you trade forex. That’s because banks and other market participants make money by selling the currency to customers for more than they paid to buy it and by buying the currency from customers for less than they will receive when they sell it. This difference is called a spread and we’ll talk more about spreads later in this blog.

As you can see, currency exchange rates fluctuate. Retail customers who trade in the forex market hope to profit from those fluctuations.

FOREX

FOREX,


First, let me define FOREX. Foreign exchange, or FOREX, is a process where you can exchange a nation’s currency to another. The FOREX market is the largest, most liquid market in the world with an average traded value that exceeds $3.2 trillion per day and includes all of the currencies in the world. The FOREX is the largest market in the world in terms of the total cash value traded, and any person, firm or country may participate in this market.

How to access?

One can start trading currencies just by having access to the Internet. Anyone can just sit at home, or work in the office, while doing FOREX transactions. Time is also not a problem as it is available 24 hours a day, five days a week. But a person joining the FOREX market is solely responsible in ensuring that the hardware and Internet connection are always spic and span. Computer bug downs and intermittent servers might affect business transactions.