Some things need to be learned before starting trading in
Forex. A proper guide is provided below:
Choose a broker
The first step that is important to learn about forex
trading. Before starting trading in Forex, it is compulsory to choose a broker
first. Decision regarding opting for a broker solely depends on the trader.
There are several brokers who would offer some options that would be
advantageous for some traders whereas the same options would of the broker
would be regarded as useless by some other traders. So, it is necessary to
reassess and evaluate the options closely that are offered by the brokers. The
trader should choose the broker whose options are viewed to be most comfortable
by the trader.
Opening a Demo Account
Once a final decision is made regarding a broker then the
next step for the trader would be opening a demo account. Almost all the
brokers would propose a trial period of 30 days at the least for their
respective trading platforms. This provides a chance to the trader for trading
on the provided trial platform by using play money instead of real money. Demo
account would help the trader to decide that whether it is comfortable to trade
in the broker’s trading platform by utilising the trading tools of the broker.
It would not be wise for a trader to start trading with real money before
determining the comfort level of the trading platform. With the help of a demo
account a trader gets a grasp on the way of using the trading platform of the
broker as well as gets to trade in the market in actual time.
Learning About Leverage
Then comes the step of learning about the leverage as
trading in Forex is characteristically done by making use of leverage or margin
trading. Margin is quite a helpful tool but can turn out to be quite dangerous
as well if not used accurately. The brokers of Forex offer somewhere from
leverage 50:1 till leverage 400:1. When the number is maximum then less money
is needed while doing a huge trade. Using leverage should be carried out with great
skill and care.
Exercise Reading of Charts
Before starting to trade the trader should make sure of
getting well-known with the charts, forex trading signals and the way they
work. It would be wise and beneficial to get introduced to the varied time frames
and the kinds of charts available. Time frames that are shorter would provide
an idea regarding the movements of the market for each and every minute. Time
frames that are longer would give a picture of the market movements in longer
periods and would demonstrate the bigger trends. Most of the software of
charting would provide charts in the form of candlesticks, lines or bars.
Making the first live trade
Finally comes the time when the first live trade is done or
executed by the trader. Although the demo account prepares the trader regarding
the aspects of technical trading but when the trader starts trading with actual
money then emotions come into the picture.
Therefore these are the important points that are necessary
to learn about forex trading.
