How Does Forex Currency Trading Work? - Closson, M
If you didn't know this already, The word "Forex" stands for: Foreign Exchange. The Foreign Exchange is the exchange of one currency for another . Hence, Forex currency trading is the exchange of a foreign currency . The Forex trader makes his or her profits from timing the market as to get the most he possibly can of one currency by exchanging it for another.
It hasn't always been so easy for the independent trader to get into the Forex trading market. Before the barriers were broken down and tossed aside in the Forex market, smaller investors who wanted to compete in Forex currency trading couldn't.
For years, the Forex market was only for the banks to make their profits, the little guy just didn't have the tools or the funding to play in this game.
By now, when you surf the Internet and see the word Forex, you have no doubt, come across the term "currency pairs" as well . All you need to know is that Forex trading is about trading currency pairs . You are taking pairs of currency - and they are always in pairs, never singles - and you're either buying those currencies or you're selling them.
There are some currency pairs that are traded more often than others, otherwise know as "majors." If you are serious about becoming a successful Forex trader you will need to know alot about these currency pairs.
You should learn as much as you can about all of the currency pairs but, try to focus on the "majors" or the ones that are traded most often, trade only those currencies you have become knowledgeable enough to trade .
Your strategy should be to buy the currency that is making it's move higher then the other currency. It's sort of like a horse race . When you bet on a horse at the track, you take a look at it's history, the competition and then bet on the one you think will win. The same principle applies to Forex currency trading. Pick the currency pairs that are going to make you a winner.
How do you know which currency is going to come in the winner? Study, you'll have to study your charts and trends until your eyes burn. A strong trend is what the banks knew and followed in the beginning when other smaller investors weren't trading and the trend is what you need to follow as well in Forex currency trading.
It hasn't always been so easy for the independent trader to get into the Forex trading market. Before the barriers were broken down and tossed aside in the Forex market, smaller investors who wanted to compete in Forex currency trading couldn't.
For years, the Forex market was only for the banks to make their profits, the little guy just didn't have the tools or the funding to play in this game.
By now, when you surf the Internet and see the word Forex, you have no doubt, come across the term "currency pairs" as well . All you need to know is that Forex trading is about trading currency pairs . You are taking pairs of currency - and they are always in pairs, never singles - and you're either buying those currencies or you're selling them.
There are some currency pairs that are traded more often than others, otherwise know as "majors." If you are serious about becoming a successful Forex trader you will need to know alot about these currency pairs.
You should learn as much as you can about all of the currency pairs but, try to focus on the "majors" or the ones that are traded most often, trade only those currencies you have become knowledgeable enough to trade .
Your strategy should be to buy the currency that is making it's move higher then the other currency. It's sort of like a horse race . When you bet on a horse at the track, you take a look at it's history, the competition and then bet on the one you think will win. The same principle applies to Forex currency trading. Pick the currency pairs that are going to make you a winner.
How do you know which currency is going to come in the winner? Study, you'll have to study your charts and trends until your eyes burn. A strong trend is what the banks knew and followed in the beginning when other smaller investors weren't trading and the trend is what you need to follow as well in Forex currency trading.
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