Forex Education - Free Online Trading University

Why Forex trading? This is probably one of the questions that you need a reasonable answer. There are hundreds of investments out there that you can prefer, but why go trading foreign currencies instead? Forex investment is unique in various aspects. Its trading volume is relatively huge compared to other market. It has extreme liquidity or the capability of either buying or selling the currency without causing significant movement in the market price. It has the largest number and variety of traders. It is one of the markets that have long trading hours (24 hours each day, except during weekends. Trading locations are almost everywhere, not just in the United States or major cities of Europe. There are different factors that affect foreign exchange rate. Another whooping fact that will make you excited to go on Forex trading: it has an average turnover in traditional foreign exchange market of around $1.88 trillion daily, according to the Triennial Central Bank Survey of the BIS (Bank...

The first step in technical analysis is to learn to read the charts. Here are a few basic lessons to guide your early attempts. When first analyzing a currency pair, look for the prevailing trend. Start with the long-term charts (monthly, weekly, and daily), going back for several years. Because these charts contain a greater amount of data, they provide a clearer picture of just what the currency pair is doing than the short-term charts (hour, half-hour, 15-minutes, or 5-minutes). The extra data also makes what the indicators are telling you more reliable. Identifying the trend is simple: just look at the chart and decide if the graph is going more up than down, or more down than up. Trends can be steep or shallow, years long or weeks short. Practice identifying them, and finding the points where they change direction. The longest-term trend is the strongest, which is another reason for looking at those charts first. Even if you’re scalping or day trading and don’t intend to hold a po...

Forex Trading – All about a Forex Quote. The word FOREX is derived from the words “FOReign EXchange. Unlike other financial market in the world, Forex is open 24 hours every day where there is always a major financial center open where banks, dealers, hedge funds, corporations, individual investors and speculators are trading currencies. The cumulative buy and sell of a currency causes the value of your Forex investment to move either up or down. There are numerous factors that cause the fluctuation of exchange rate. A country’s political, social and fundamental economic environment and their central banks fiscal policy, interest rate adjustment are some of the common factors. To have a better understanding how the currency exchange rate can affect the value of your Forex investment, this article will concentrate on the topic of Forex Quote. Currencies are traded in pairs and each currency has its own symbol. For the Euro dollar - it is EUR, Japanese Yen - it is JPY, for the Pounds Ste...

Everyone who enters into the forex market to trade always starts off with good intentions. They will invariably aim to win. They are there to make gigantic profits in the market. After all, it is a keen interest in trading that has led to their involvement in trading the forex market. In all my years of trading, I have yet to meet a complete newbie who is in the forex market to trade without spending at least some time to learn how to trade. At worst, the newbie to forex trading has at least learned the technical terms to trading, and has at least entered his trading account to look at the trading platform and the trading interface provided by his broker. In the quest to become a better trader, most forex traders I know would have learnt the use of many tools, usually technical tools. To them, the tools are their weapons of war. Many use technical trading systems to help them get a more accurate analysis of price movements, and to study price trends. Some use simple trend trading metho...

Foreign exchange (forex) currency trading, the largest financial market in the world, requires a minimum of capital to invest and the profits can be substantial. Once you have learned the basics of forex, you’re on the way to making money through the simultaneous buying or selling of currencies. Forex trading is instantaneous; as soon as you click the mouse, it’s done. The most commonly traded currencies, easiest to liquidate, are the U. S. dollar, Japanese yen, British pound, Swiss Franc, the Canadian dollar, Australian dollar, and the Eurodollar. Unlike the stock market, forex trading has no central exchange. With forex, you can make a profit whether the market is up or down vs. only making money when the stock market is on the rise. By taking the long position with a pair of currencies, the forex trader buys at one price and sells when it reaches a higher price. The other option for the forex trader is to go short by selling currencies, anticipating depreciation, and then buying bac...

Dear Friend, Forex traders are raking in big profits with low risk high yield, investment strategies that exist only in the foreign currency market. Especially those who have a trained eye that can see excessive profit points that explode when done correctly. The forex market has created many millionaires who understand the exceptional leverage that is provided by trading currency. To be exact a 100:1 leverage ratio, this means you can leverage your money 1x100 so $100 leverages $10,000 and $10,000 leverages $100,000. This extraordinary benefit of the currency market allows you to realize windfall profits in a short period of time and can quickly make you a lot I mean a whole lot of money. Big Businesses, banks, and wealthy investors have been making billions for years from foreign currency exchange, and now the little guy with a few hundred bucks has the same opportunity to profit from this supercharged money making forex machine. My friend the forex boom is just beginning and I have ...

It is becoming increasingly popular to trade in the forex market using automated forex brokers. These are firms or companies that operate websites online to offer easy access to instant currency trades for their clients. These automated brokers are instantaneous so the clients don’t have to worry about the value of the currency they are choosing changing negatively before they have the chance to complete their transaction. Going automated is extremely good for the brokers for two reasons. It helps to bring in more clients and from there they get more commission. Also the automated system saves brokers a lot of time. The old way of taking orders was usually by phone and a broker had to do a lot more work with this method. By going automated the broker saves themselves the effort of handling phone calls, research prices and seeking out new clients. They only have to maintain the website and its accounts, and perhaps order some advertising for new clients. New clients using an automated b...

The Forex market has a downside: you could lose. But even the downside has an upside: you can’t lose much. If you pay attention to the principles of Forex money management, you can control how much you lose. And even if you lose half the time, in this market you can still make a profit. First of all, understand this: you will lose sometimes, because in this or any market, everyone loses sooner or later. No one is perfect and no one calls every trade perfectly. There is no magic software or enchanted system that is right all the time, no matter what the sales materials say. So be prepared, before you ever begin trading, to lose some money. But in the Forex market, you can only lose the price of the lots you purchased. Although that amount varies from broker to broker, in a mini account the average purchase price of one lot is U. S. $100. And that’s it; $100 per trade is the absolute maximum amount you can lose per trade. If the trade goes south and the market moves against you, even if ...

In the vocabulary of investment, "speculation" is a nasty word. It suggests gambling, insecurity, long shots, luck, and similar improprieties. For old campaigners it stirs up memories of the 1929 unpleasantness, as damp weather tweaks the rheumatic joint. And, worst of all, it seems synonymous with money lost. For every speculator who pulls a coup, we hear, there are 99 who live to rue their recklessness, to bemoan the hard-earned dollars foolishly and irretrievably cast down the drain. The New York Stock Exchange labors long and hard to encourage a sober, sensible attitude in investors. Conscientious brokers steer their customers away from situations bearing a speculative tinge. The literature of investment inveighs against empty-headed avarice, blind faith, and other vagrant impulses that lead the innocent into ill-starred ventures. If fear breeds caution, all well and good. For speculation can be extremely hazardous, particularly for the new investor, which means in most c...

Money. We all need it. We all want it. Trillions and trillions of dollars, pesos, euros, pounds, levs, francs, and more change hands every day for goods and services around the world. Most of us are only familiar with the money that is exchanged for goods and services in our own country and are only concerned with getting more of that. But there is a lot more to money than that. What is the relationship between the currency in your country and the currency of some other country and why should it matter to me? I’m glad you asked. In this article we will explore some of the currencies around the world and answer some questions you may not even know you had. First, if we are going to discuss currency and it’s relationship to other currency, we have to talk about Forex. That’s short for foreign exchange or the exchange of currency for a different type of currency. There is no market in the world, including Wallstreet that can compare to Forex in volume of cash traded daily. Retailers, Gove...

The foreign exchange market, or Forex market, is an around-the-clock cash market where the currencies of nations are bought and sold. Forex trading is always done in currency pairs. For example, you buy Euros, paying with U. S. Dollars, or you sell Canadian Dollars for Japanese Yen. The value of your Forex investment increases or decreases because of changes in the currency exchange rate or Forex rate. These changes can occur at any time, and often result from economic and political events. Using a hypothetical Forex investment, this article shows you how to calculate profit and loss in Forex trading. To understand how the exchange rate can affect the value of your Forex investment, you need to learn how to read a Forex quote. Forex quotes are always expressed in pairs. In the following example, your pair of currencies are the U. S. Dollar (USD) and the Canadian Dollar (CAD). The Forex quote, USD/CAD = 170.50, means that one U. S. Dollar is equal to 170.50 Canadian Dollars. The currenc...

Here are some tips to help you start trading Forex profitably: There’s so much information about Forex trading online that it’s understandable for the novice trader to feel overwhelmed. Here are some guidelines on how to get started in the Forex market. First of all, study. Read everything you can find on the basics of the Forex market, starting with these articles and continuing with whatever else you can find. With all the free information about the Forex market currently available online, you shouldn’t have to purchase anything at this stage. When the data makes sense to you, choose a broker. This decision should be based on your trading needs. If money is going to be tight, find a broker that offers a micro account, so you don’t blow your entire trading budget in the first week. Also, make certain there are no hidden fees. If you’re trading on a small account, it would be inconvenient, to say the least, if your entire monthly profit was eaten up by a maintenance charge. When you’ve...

What are the advantages of Forex over other types of investments? LOW RISK - HIGH YIELD is the first thing that comes to mind. Forex Trading can be risky and the general rule for investing is: When the return is high the risk is high, but with correct planning and strategy combined with a certain amount of self discipline you can bring the risk factor down to a level that is quite low. It is even possible to strategically plan your market entry and exit levels and control exactly how much you profit or lose. This can be done in a way that allows the investor to still profit even when they misjudge the market 50% of the time! Compare that to other types of investments. GEARING, is another area that stands out as a major advantage; this also substantially reduces the risk to you the investor. When you trade 1 forex “Mini lot” you will be trading a parcel of money valued at $10,000 USD And you only need $100 USD of your own money! If you trade a regular “Lot” you only need $1,000 USD to t...

The origins of today's futures market lies in the agriculture markets of the 19th century. At that time, farmers began selling contracts to deliver agricultural products at a later date. This was done to anticipate market needs and stabilize supply and demand during off seasons. The current futures market includes much more than agricultural products. It is a worldwide market for all sorts of commodities including manufactured goods, agricultural products, and financial instruments such as currencies and treasury bonds. A futures contract states what price will be paid for a product at a specified delivery date. When the futures market is played by speculators, the actual goods are not important and there is no expectation of delivery. Rather, it is the futures contract itself that is traded as the value of that contract changes daily according the market value of the commodity. In every futures contract there is a buyer and a seller. The seller takes the short position and the buy...

When it comes to investing on the Forex, there are two basic paths you can choose: Fundamental or Technical. Fundamental investors look at changing interest rates, GDP figures, and other economic indicators to help them anticipate fluctuations in the exchange rates of currency pairs. Technical traders, on the other hand, look for trends in the market to help them identify currency pairs and the best enter and exit points on a position. Fundamental investors rely upon news releases and their overall impression of the economic outlook of nations in a currency pair. Technical traders, however, use charts and the application of analysis to help guide their investment decisions. Fundamental investors tend to be short-term investors while technical traders try to look at the bigger picture and be more focused upon the long-term pricing outlook. In truth, most technical retail traders on the Forex market do not have the time to compile charts from scratch. While many retail investors do impor...

I received the following question from one of my list members today: "... you referred to the currency exchange cash market and the fact that this is basically a market between banks across countries. Does this mean that, for example, the EURO/USD exchange rate is set between the Federal Reserve and the ECB? Is that how a price is established without the benefit of any trading on any listed exchange anywhere else? Thanks for the brief education on this particular point." - Stan Z. The forex spot market is primarily an "interbank" market. That means the majority of the trading volume is done bank-to-bank such as between Citibank and Goldman Sachs, for example. This trading is generally done on behalf of banking customers such as multinational corporations, though the banks also trade with each other both to hedge their currency exposure and to take on trading positions. This sort of market structure is the same as the one for most cash market government debt trading,...

More books and articles have been written on the stock market than on perhaps any other business subject in the world. Most of these have as their purpose instructing the reader on exactly how he can invest to make a sizable amount of money, and if he really applies himself, how he can become rich in either three or five years. One of the most useful books written appeared in 1961. It did not tell you how to get rich. It emphasized the difficulties of investing in the stock market and it performed a tremendous service in this way, plus isolating the significant factors which record and explain the ups and downs of the market. To invest in the market by following the procedures outlined in that book is anything but easy. It requires a considerable amount of work every day the stock market is in operation. The book is written more for the professional investor to tell him how to make maximum profits out of both the rises and falls of the market. The average investor will not take the tim...

This article will explain some of the differences between Technical Analysis and Fundamentals and explain a bit about each type of trading. Excerpts are taken from the best-selling book ‘Market Wizards’ where Jack Schwager interviews Ed Seykota and Bruce Kovner. Ed is a trend trader (uses technical analysis) and also relies on hunches from 20 years of experience. He definitely emphasizes his reliance on technical analysis. While reading this, I liken, the ‘hunches’ to knowing the effect fundamentals can have on a market although I could be mistaken, they could be purely from reading lots of charts so well. Here are is exact words “Fundamentals that you read about are typically useless as the market has already discounted the price, and I call them ‘funny-mentals.’ However, if you catch on early, before others believe, then you might have valuable ‘surprise-a-mentals.’” Ed says his priorities when trading are the long term trend, the current charts and picking a good spot to buy or sell...