How To Trade Forex:

   Forex Trading is a world wide trading market where traders trade currencies, Crude Oil, Gold, Silver and stock from any country, any place and any time over the internet. Its a 24/5 open market. Forex market values (Rates) rise and fall due to number of factors including economics and geopolitics. The goal of trader is to get profit from these changes in the value of one currency to another by actively speculating on which Forex prices are likely to turn in the future. This market trade about $5 Trillion per day. You can Trade Forex by Following these steps. How to trade Forex?

Any one start Forex, he/she must know the basics of Forex, how to trade Forex? This article is about the basics of Forex Trading and tell you about, what things are necessary for the start-up of Forex trading. Lets check how to trade Forex step by step.

Forex Basics:

Understand Basics of Forex Trading:

How to Trade Forex? Basic steps..

• The Currency You are Buying is Quote Currency .   The Currency you are selling is a Base Currency . These are pair of currencies that tells the relationship of currencies one another, the value of one currency is reflected with other one. For example if any one determine the exchange rate between US DOLLAR (USD) and the JAPANESE YEN the Quote will be like this: In this example USD is a Base Currency and JPY is Quote Currency.

USD/JPY=116.3

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• Exchange Rates are the rates that comes directly from Forex Exchange, this is between two currencies at which one currency will exchanged with the other one. this rate will tell you how much you have to spent to buy a currency.
• Bid is a price where trader will sell its particular currency pairs. Bid price is a price that trader will get for the short position. Bid price is always lower than the ASK price. Difference between BID and ASK price is called Spread.
• ASK price is always greater than the bid price. Difference between ASK and Bid is called Spread. For example, if the USD/JPY is at Bid 90.90 and ASK 90.92 a trader can buy the position at 90.92 (ASK Price), or Sell the position at 90.90 (Bid Price).
• Spread is the difference between Bid Price and Ask Price.
• Long Position is a position in which you buy Base Currency and sell out the Quote currency. Like in  USD/JPY  you will buy USD and sell JPY.
• In  Short Position  you want to buy Quote Currency and sell Base Currency. Like in  USD/JPY  you will buy JPY and sell USD.

Choose what Currency you want to Sell or Buy:

• Read Forex Quotes and see the Bid and Ask prices, the bid price on the left and the ask price on the right.
• Choose in which Currency you want to trade, its all about the economy of the Country of which you choose the currency. Also its depend on the volume of the market, and if the market volume increases the more trades will occur and its best time to trade currencies. If you believe that the economy of US will get weak this will be bad for the US Dollar and buying of US Dollar in this condition will get loss for you and its best time to sell the US Dollar.

Lot Size and Profit Calculation:

• Micro Lot size 0.01 : 0.01 is per micro lot size and its a lowest lot size in the market. For Example Currencies 1 Pip,  if Euro (EUR) =1.0540 and change to 1.0541 it will increase by 1 pip and will get profit with micro lot = $0.10.
• Mini Lot size 0.1 :  0.1 is Mini Lot size and 10 micro lots = 1 mini lot, If Euro (EUR) =1.0540 and change to 1.0541 it will increase by 1 pip and will get profit with 1 mini lot=$1.
• Standard Lot size 1.0 : 1.0 is the standard lot size and 10 mini lots are equal to 1 Standard lot. If Euro (EUR) =1.0540 and change to 1.0541 it will increase by 1 pip and will get profit with 1 Standard lot=$10.

Find Brokers:

• Look for someone who has experienced in Forex Industry more than 10 years. Experience tells that company knows that what its doing and knows how to take care of clients.
• See how many products broker is offering and if the broker is giving securities, commodities then you know that broker has bigger client base and wider range of business reach. Visit Brokers website see either it is professional or not.
• Focus on the customer support of the broker how he manage its clients and its transaction and withdrawal process.

Open Account:

• Reach the best broker and ask broker to open account. He will provide you Demo and Live Account. Demo account is just a practicing account that is only used for practice for different trade (its cost free you don’t have to pay a single cent). After that you will go for the live account and you will then Deposit initial amount to the broker at which you will start Forex trading.

Analyze The Forex Market:

• After opening a live account you have to analyze the market. Following three methods are most used :

1.   Technical Analysis
2.   Fundamental Analysis
3.   Sentiment Analysis

• Technical Analysis : This technique involves Charts or Historical data to predict the rates of market how currency will moved bases on history.
• Fundamental Analysis : This type of technique involve looking the economy of the country on the basis of economy you have to buy and sell currencies.
• Sentiment Analysis :  By this technique you have to analyze the mood of the market either its is Bearish or bullish.  Using this technique you can make good guess and make your trades profitable.

Margin:

• Determine your margin at your Broker. Margin is the way by which you can trade with big amount with your small investment. For example if you are investing $1000 and you want to trade with $10,000 then you have to pay this $1000 as a security to your broker and start trading with $10,000.
• Your Profit and losses are either add to your account or deducted from its values.

Profit or Loss:

• Watch you profit or loss of your trades don’t get emotional Forex Market is very volatile market anything happen any time you will see a lot of up and downs. Just Stuck with your business and keep searching  and make different strategies to increase your profit.