For those who know nothing about Forex trading, it involves the buying of one currency and the selling of another with the aim to make a profit from the trade. When trading on a Forex platform, you choose one pair of currencies, EUR/USD is a currency pair trading the Euro against the US dollar, but you can trade any currency pairs.
Learning the trading jargon
Naturally, before you start trading, you need to familiarise yourself with the many terms and acronyms that are used when you trade Forex and there are many websites that clearly interpret trading jargon, so you can familiarise yourself with the language.
Understanding the trading process
So, you are basically choosing two currencies and you are predicting that one will gain against the other. Real time trading is available 24 hours a day for 5 days a week. The 24-hour trading day begins with Sydney Forex opening, followed by Tokyo, Hong Kong, Singapore, then moves into Europe with Zurich, Frankfurt, Paris and London, then the day ends with the US forex. There is no trading on Saturday and Sunday, so you can use this time to research and keep up with current trends.
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Demo account
If you are new to trading and you think you’ve got what it takes, start by opening a demo account and the only difference between that and a live trading account is money; when using a demo account, you are investing imaginary money. Some new traders spend an entire year trading like this and when they feel they are competent, they open a registered trading account, link their bank account and they are ready to trade. It is important to be fully competent before you trade for real’ learning never stops for a trader
The trading arena
There are no centralised marketplaces, rather Forex is a group of secure servers that run a virtual marketplace. Cyber-security is top-notch so all traders are protected and the best way to access global markets is through a reputable Forex broker. Using different time zones, you can trade when you want to; some day traders follow the market openings as the day progresses. Time management is obviously important with global trading, which is something that soon becomes second nature. Never let emotion into the equation when trading, always make data-driven decisions.
Conclusion
Many Australians trade in their spare time and like most things, the more effort you put into something, the better the outcome. The learning curve is long and everything you need in terms of learning resources can be accessed on your broker’s website. If you spend 2-3 hours a day educating yourself on trading, that will soon take you to a position whereby you trade with a demo account. You will find your own level and learn much from the experience and hopefully, trading will bring you a good income.
