Forex Trading, The New Way To Get Rich

Invest in Forex, the world's fastest growing market. It is definitely possible to earn much money and be rich as a forex trader. However, you should remember that currency trading involves substantial risk.

18. May 2024 by Web Money Guy / Moneyspinner

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All speculation involves risk of loss, regardless if it comes to shares, property, or currency. However, risk-taking often gone forward as a key factor for it to become rich.

The Foreign market is the world's largest and fastest market, and more and more find that it is possible to earn millions on currency trading. But how do they do it?

There are mainly two ways to make money on forex trading, namely long-term investment or short-term trading.

  • Long-term investment: You are speculating in the long-term changes in the exchange rate, in other words, whether the course is going to rise or fall. Example: You buy U.S. Dollar with the Swedish kroner because you think U.S. dollars are going to strengthen against the crown, and wait for one year before you switch your U.S. dollars back to the Swedish kroner.
  • Short-term trading: Trading involves frequent trading in foreign currency. For example, you can buy the U.S. Dollar with a different currency, then sell again within hours or minutes later. If the entire trade (both purchase and sale) will take place on the same day called the day-trading or intraday trading.

From now on we will take for us short-term trading of currency (currency trading), as it is possible to earn much money on this even if you do not have much money to begin with.

How to make money on forex trading?

The starting point for making money in the foreign exchange is that you must have money to invest or trade with.

To make money you need to buy cheap and sell for more - more difficult it is not! In practice, it is not so easy, but the potential for profit virtually unlimited, since it is related to the fluctuations (changes) in foreign exchange.

Example: You can make a deposit with your online broker. This veksles in any currency, such as the euro. You can then use your euro to buy U.S. dollars. If the price of the U.S. dollar has gone up again when you sell your U.S. dollars against the euro, you have earned money. If you want to transfer what you've earned to your bank account, and exchange your euro automatically return to the Swedish kroner. It's not!

Forex Trading in a nutshell

It is quite easy to learn the basics of currency trading. It will certainly a part of experience and knowledge to be a really good currency trader, but the basics do not so long to learn. We will try to explain it as simple as possible.

Let us first start with to explain some important concepts:

  • Currency pair and rates. When one is in the currency as operating Monday with currency pair and rates. Let's say that the exchange rate for the currency pair USD / USD is 5.0941. That is, for 1.00 U.S. dollars you get 5.09 Swedish kroner. For 100.00 U.S. dollars and will return her 509,410 dollars.
  • Base Currency and counter currency. In the currency pair, USD / GBP as the base currency is USD, EUR and are facing currency. What comes first is always the base currency, and it will last is always the opposite currency.
  • Pips (or "Pips", score, "Points") is a number that says something about whether the share price rises or falls. For example, if USD / GBP rising from 5.00 to 5.15 as the share price rises by 15 Pips. If USD / GBP drops from 5.00 to 4.90 as it has decreased by 10 Pips.
  • Forex (Foreign Exchange) is no more complicated than it is the English naming of the foreign exchange.

Before you can make money in foreign exchange you must complete a trade. The act of currency is not particularly more complicated than buying a sack of potatoes and a liter of milk. Monday alternates a "thing" against another "things" more difficult it is not. You give us something, we give you anything back. You give us 20 million, and we give you a sack of potatoes. You give us the Swedish krone, and we provide the U.S. Dollar. The actual trade - that the switch to Swedish kroner in U.S. dollars - is a simple process that all can understand. The challenge is to find out which is which is profitable ...

Forex and risk: You can earn an unlimited profit, but you will never lose more than you had to begin with. However, you should only trade with money you can afford to use, and that will not be necessary for other important personal purposes.

How do I know what currencies to buy?

Most new to currency trading has little or no Opinion on what is "good idea" to buy, alsa which currency you should buy to achieve the greatest possible profit.

To know what is a good idea to buy you must have knowledge of the various currency pair. It is quite common to specialize an currency pair within, or a few currency pair. For example, one can specialize in trade with USD / EUR (U.S. dollars and Euro). As you get more experience will be better at understanding what it is that makes the USD strengthens or weakens against EUR, and vice versa.

The big question is: How do I know what affects the exchange rate?

To put it in a simple way: If all goes well in the U.S., and generally strengthen the dollar. If it goes bad in the U.S., so the dollar will weaken them. There are many variables affecting the course of a currency pair, but fortunately do not have the overview of all these to succeed. For example, changes in unemployment, consumer confidence in the market, or control interest rates help to change the exchange rate. If unemployment in the United States will be reduced (positive for the U.S.) will affect the dollar positive, and the dollar can thus force itself. And vice versa, if unemployment goes up (negative for the United States), so can the exchange rate for U.S. dollars to weaken them.

It is really many variables that affect the exchange rate - but the good news is that you can succeed in currency trading without taking into account all these variables ...

Because there is an easier way to trade in foreign exchange, and it is following the trend.

The trend is Your Friend

The trend is your friend, especially when it comes to currency trading. Let us give you a metaphorical example:

Meteorologists have spent several years of his life to give us all second forecasts about the weather. Yet it happens from time to time that the reports of Skyfri sun and sky, and so are the gray clouds and rain instead of.

But even the non-educated meterolog can predict the weather with chances. How? Let's say that it has been sunny and warm weather from. To 08:00 pm. 14:00. Will it be likely that there will be sunny in the day. To 14.00 pm. 14:05? We have not said anything about whether there are clouds in the sky or not. But still, in most similar cases, there will also be sunny and hot from 14:00 to 14:05.

Similarly, it is with exchange rates. To make an analysis on how it should go with an exchange rate several months into the future is extremely difficult and complicated. Follow a trend on the other hand is not difficult at all.

Let's say that the USD / EUR has had a relatively steady increase from. 10:00 to 12:30. Would not that be likely that the exchange rate would also continue to rise between 12:30 to 12:35? Yes, it would be very likely.

If you start with the following trend when currency trader, you have an excellent platform to succeed in currency trading.

It is important to start to make money as currency trader is anyway to get started, try and gain their own experiences.

For example, you can now start right away to trade on the USD / EUR (we come immediately to how, purely practical). If the USD / EUR has gone up steadily in the last hour, so you buy USD with EUR. You expect that the USD will increase over the next five minutes, too. Then wait five minutes, so you sell your EUR, and you will hopefully be back with more USD than what you had five minutes earlier!

The example above is only an example of a strategy.

Margin Forex Trading

There is nothing called free lunch in the foreign exchange, but if you want to make money so you should probably put you into this with trading on margin as early as possible.

Trade on margin (or "giring" which is also called) is important because you can earn much money even if you only invest a small sum. This may sound incredible to some, but it is with this "giring" that really makes currency trading so exciting.

Listen, if you buy one currency and sell it only five minutes later ... how much did you really expect to earn. The rate may have moved 0.05% on in the minutes, and there is nothing to get rich off! The secret is to act on the margin. Let us explain ...

The acting on margin means to trade for more than what you have invested. Say you have $ 10,000 that you will be using for currency trading. If you "girer" This investment 100 times, so you suddenly have $ 10,000 x 100 = $ 1,000,000 to trade for. One million dollars! Your $ 10,000 now works as a security, and you get a "loan" of one million dollars, but this loan is not responsible for the excess of the $ 10,000 that you have for trade.

An example of fast money in the foreign exchange: You trader in the currency pair USD / EUR, and buy with EUR USD. Five minutes later, use your EUR to buy back U.S. dollars. Let's say that during these five minutes as the share price rose by only 0.5 percent. If you had invested $ 10,000 so you would have earned $ 50, which is very small compared to that you risked $ 10,000. However, if you had invested the same $ 10,000, but at the same time the gears its investment by 100, so your investment would have been of $ 1,000,000 (but you still only risk your $ 10,000). In this case you would have earned $ 5,000!

Trading on margin is the way to wealth in foreign exchange. However, you must not forget that currency trading is risky, and we remind again that you should only trade with money you can afford to lose.

How To Get Started

To trade and make money in the foreign exchange must be linked to a broker, and the easiest way to do that is that you can buy and sell foreign currency through a currency platform. There are many good foreign exchange platforms, but perhaps even more poorly. What you should put particular emphasis on when you select the currency platform is the quality of the platform, as well as customer service and security.

Here we have listed three foreign exchange platforms in the world:

RECOMMENDED EXCHANGE Platform: The following currency platform is recommended to anyone who wants to trade online:

Conclusion: Currency Trading offers exciting opportunities

Forex trading is definitely one of the more realistic ways of making money, but it requires experience and knowledge. But even those who have served the kingdom on currency trading started as the beginners once. Experience and knowledge must come gradually, and if you think trading with the currency seems interesting, why not try it to find out if this is something for you?

Starting is easy, but do not forget that there is high risks involved in trading. Please understand the risks before you continue.

By tradeing on margin (as explained above) you can earn much more money, even with small movements in the exchange rate. However, margin trading also assumes more risk.

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