The Forex market is a lucrative source for many Forex traders. In addition, learning how to trade Forex can be an exciting and rewarding endeavor for many in the forex trading potential. To imagine that the global Forex market sells for about $ 4 trillion a day. It’s an easy և simple process to learn how to run a business and then make a profit or money from the enterprise. And as the famous cliché says, “you have to make money to make money.” Forex trading is mainly currency trading. So to get started, you need to invest some capital in your business. Forex trading is a speculative activity through which you, as a trader, assume that the value of the money (currency) you buy will increase relative to the base currency.
Before entering the Forex trading, you should get acquainted with the basic conditions of Forex. The base currency is the currency you are selling, while the quote currency is the currency you are buying. For example, in a currency quotation or EUR / USD list, EUR is the base currency and the dollar is the quoted currency. Then there is the bid price, which represents the optimal selling price for your currency. This is the price at which Forex brokers are willing to buy the base currency for the quoted currency. The query price, on the other hand, is the optimal price at which you are ready to buy currency. Or, it is the best price at which the broker is willing to sell the base currency for the quoted currency.
The base currency is considered to be 1 unit in currency quotes. An investor can make money by trading a currency either by increasing the value of the quoted currency or by decreasing the value of the base currency. For example, if the EUR / USD quotes rise from $ 1.1451 to the $ 100,000 lot of 1.461, the investor will earn $ 100,000 (1.1460-1.1450) $.
Following these basics, the trader will open an online Forex broker account. There are many brokerage firms in the field to choose from. It is recommended to use an internship account before the live broadcast. Almost all Forex accounts have a practice or demo account. A demo account will help you to know the various aspects of Forex trading. Next, as the Forex trader bets on currencies, study the market first. Analyze, for example, the political environment of currencies. Also, start small.