Tag: How to trade forex

  • How to predict movement in the Forex market?

    How to predict movement in the Forex market?

    How to predict movement in the Forex market?
    It is possible to predict movement on the Forex market based on several factors.

    By Guy Avtalyon

    I know some of you will wonder if it is possible to predict movement in the forex market. We are all suspicious about any kind of predictions, so why wouldn’t we be when it comes to the forex? On the other hand, almost every successful forex trader will tell you that successful trading comes from the ability to predict the movement in the forex market. So they must know something or they have some secret ingredients or skills.

    I want to tell you that the ability to predict movement in forex isn’t something you can be born with. Actually, it is something you are building all your trading life. To create that complicated construction, you must understand the factors that influence a currency’s exchange rate. Of course, if you want to profit from forex trading.

    Well, why shouldn’t you?

    Millions of traders want to trade Forex because they understand it is the best market to trade. The potential of the online trading market is excellent.

    So I want to tell you more about the factors you should consider in trading forex. That could help you to predict movement in the Forex market in a way to have better chances for success.

    Predict movement in the Forex market

    One of these factors you have to pay attention to is economic growth. The central banks in a country with a strong economy will raise the interest rate to prevent inflation. Higher interest rates always drive the growth of the number of investors, which means the demand for domestic currency increases. 

    Another factor you should understand is geo-politics. You have to watch and notice any kind of disturbance in the political scene. I know you might think it’s too dull. Well, this is very important if you want to predict movement in the forex market because political changes can change the direction of the exchange rate. We saw this so many times in history. If you want to trade currencies successfully, you’ll need to follow political and economic news. 

    Speaking about interest rates, keep in mind that some currency’s value increases along with rising interest rates. This increased value is known as capital appreciation. That is exactly what gives you the opportunity to profit in trading forex. The currency rate is associated with interest rates. So pay attention to it. The data you gather could be a great help in predicting movements in the Forex market.

    Arguably one of the most important factors is recognizing if the currency is conditioned on the country’s capital or trade flow. Capital flow represents the amount of investment some country receives from international capital reservoirs. Trade flow represents income produced from trade. So, you’ll notice that some countries depend on capital flow, while others are very dependent on trade flows.

    The least important factors are mergers and acquisitions when we talk about predicting movements in the forex market. Still, mergers and acquisitions can show you near-term currency changes. Smart traders always pay a lot of attention to them.

    Sure ways to predict movement in the Forex market

    The power to predict movement in the forex market can differentiate a profitable trader from a loser. It’s essential to understand the factors that cause changes in the currency’s price value if you want to last in the forex market. Here is another set of factors that will help you predict any movement in the forex market and allow you to get an advantage in the trade.

    The Consumer Price Index, or CPI, is one of the reliable methods. This measure indicates when the prices of consumer goods are rising or falling. When CPI is above 100, you can be sure the inflation is on the scene. On the other hand, we can be talking about deflation when it is under 100, as the prices are falling. You can calculate CPI per formula

    CPI=(Ct/C0 )*100

    where Ct is the cost of a market basket at the current time, and C0 is the cost of a market basket at some point in the past with which it is compared.

    How does this influence forex trading?

    It’s quite simple. If the inflation rate is steady, you’re sure you can trade a specific currency pair. On the other hand, if the inflation rate is high, stay away, or you’ll end up in losses.

    Catastrophic natural disasters such as hurricanes, earthquakes, or floods ordinarily change a country’s currency and never in a favorable direction. The consequences of these events could cause a currency to depreciate. 

    Also, wars! They might have a calamitous result on the economy. I’m not talking about the damage to infrastructure. The currency value can be diminished, which is more important. It would help if you were updated on such an event to predict the movement in the Forex market. If you trade a currency pair that consists of the country’s currency in war, wait till the economy stabilizes.

    You must have information at your disposal to help you trade forex. No one is saying you should trade without risks involved, but you should calculate the risk. It is the key principle if you want to make a maximum profit. Forex traders are always updated on events that may change the currency pair’s rate. By knowing them, you’ll be able to strategize your trades better. You’ll have a clue when to enter or exit the position.

  • How To Make Living Trading Forex?

    How To Make Living Trading Forex?

    How To Make Living Trading Forex
    Trading forex is like a battle – if you want to win, you have to be ready for it.

    By Guy Avtalyon

    If you’re new to trading, you might wonder – how to make living trading forex? Is it possible at all? Well, everyone knows the small traders don’t. But, I have to tell you it’s possible. Even for the small traders. 

    It’s really possible to make a living from forex trading.

    I was just like you several years ago. You wouldn’t believe how desperate I was to earn money. Yes, I had a steady job at that time but it was barely enough to spur my dreams. And one day I met a man who told me he was making thousands per day.  I couldn’t believe it. I thought he was joking. That man told me he is a forex trader. 

    So what, man? The shocking surprise came several days later.  I heed his advice and have made thousands of dollars. 

    I’ll show you exactly how I did and how you too can do the same. So, here is! How to make living trading forex? 

    You might start making money from Forex trading even if you start with a $1 account. Honestly, if you start under $1000 you’ll not have a chance to leave your current jobs but slowly, your capital will grow and you could eventually make a living by trading forex.

    So, how to become a successful Forex trader? How much can you really make? How to make living trading forex?

    Let’s hop right in. 

    How to become a professional trader?

    The problem with new traders is that they minimize the engagement needed to succeed. If you’re not ready to do what it takes to become a professional trader you should put your dreams about making serious money aside. You have to be committed. You’ll need to invest a lot of your time to learn, build a winning stance by getting the trading skills. You’ll need a suitable mindset, one that will allow you to make money constantly.

    First of all, never give up due to the slight mistake. Second, never challenge or make wild trades. That will lead you to lose more than you should do. 

    Start your day trading as a part-time job. Think about your profits as an additional income. Later, when you come up to the point of fully understanding the forex market you might decide to invest large sums. But firstly, test yourselves, your skills, check your risk tolerance, your trading personality. Only in that way, you’ll build confidence. Never just jump in trading. 

    How much capital to invest to make a living trading forex?

    This is a very important decision. Don’t underestimate it. You have to precisely calculate how much money you can put at risk. That said, it isn’t the same when you are trading to earn some extra cash to pay for luxury travel or you’re risking your hard-earned money to live better. Sometimes, the financial survival of your family is in the game. Trading forex could be extreme psychological pressure. So, you’ll have to decide how much money you can put at risk until you develop and improve your trading strategy.

    What is the secret to Forex trading success?

    A consistent Forex trading plan. If you don’t have a trading plan, you will lose your money. Eventually, you’ll not succeed as a forex trader. Bear to your mind, you’ll not make billions on a single trade. The success in forex trading means you have a series of consistent trades supported by your trading plan. It is never a matter of luck. Forget it! Only if you have a consistent trading plan you can be successful. Forex trading isn’t gambling, so luck has almost zero influence. 

    It’s like in your life. Your life is shaped by things you’re doing consistently. Not from time to time. 

    If you want to be a successful Forex trader you’ll need the dedication to trade according to your trading plan. You’ll need your own rules, your strategy. 

    How to trade Forex? 

    You’ll have to learn how to predict the movement of the forex market. That’s not all! There is more! 

    For each transaction, you’ll need to predict how the value of one currency will go against the other in the currency pair. Some pairs are moving 100 pips every day. That depends on the market conditions for the day you’re trading. And it is changeable. Sometimes during one day, the changes can be enormous.

    Guys, I really hope you know what the pip is! Nevermind, it is the smallest movement of a currency pair. For example, if you trade EUR/USD currency pair and it moves from 1.1900 up to 1.2000 you’ll make a 100 pip move.

    In forex trading, you can buy different lots of the base currency you want to trade. I hope you know what is a “lot size” in the forex?

    The important part of forex trading is to look at indicators to choose the pair and the time to trade. Indicators could be literally everything, from price patterns to macroeconomy. 

    You might think it’s hard to follow but here is your trading plan to help you. Also, you can find some accurate apps and use them. Or, you can use some trading signal provider. Whatever you choose you’ll have to understand the forex is full of mysteries, especially for new traders. So walk carefully throughout this field. Never rush! It’s better to miss the trade than to have the wrong trading and lose money. 

    When you fully understand forex trading you’ll see unlimited opportunities there. And you’ll see how to make living trading forex.

    How much money can I earn trading Forex?

    Yes, I’ve heard a lot of stories of Forex traders that made millions in the short term. I’m sure you’ve heard them too. Forget them! Forex trading isn’t some get-rich-quick scheme. It’s a business. You don’t believe it? Okay! 

    That’s not your pair of shoes. These traders are another category, you’re not the same. You are unique! All your characteristics are different. Your risk tolerance is unlike the trading strategy, you have different rules of risk management. Almost everything is different. Don’t compare yourselves to them. 

    How much money can you make trading forex? I don’t know. Nor anyone can know. 

    Think about the size of your account, also, how many trades you want to do per month, expected returns, will you withdraw your profits, or you’ll reinvest, how much you’re ready to risk per trade. When you get the answer to all these questions you’ll be able to calculate how much money you can earn in forex trading. 

    In any case, you must have realistic goals set in place. You must have a trading strategy with a positive outlook. Also, you must trust your trading plan.

    How to make living trading forex?

    It is like any other job. That means you’ll need skills and strategy. Motivation plays a great role. Find a mentor, that is the easiest way. Let successful traders inspire you. Learn from them. But remember, you’re in charge, you have to create your unique path, you have to shape your trading career. 

    Bear in your mind, every profitable trader made mistakes and still makes mistakes. You will make them too. But try to do that without sacrificing a big portion of your trading capital.

  • How To Trade Crypto And Stocks / Forex

    How To Trade Crypto And Stocks / Forex

    How To Trade Crypto And Stocks / Forex
    Basically, it is the same but with some differences. In this post, you’ll find all about them.

    By Guy Avtalyon

    How to trade crypto, stocks, or forex? It is similar but at the same time different from other trades, for example, stocks or forex. At first, we have to define the difference between crypto and Forex or stock trading because you have to have theoretical knowledge.

    What is crypto trading

    Crypto trading is simply the exchange of cryptocurrencies. Just like in Forex. In crypto trading, you are buying and selling a cryptocurrency for another. It’s the same as you buy Bitcoin or altcoin for USD and Euro.

    What is the Forex market

    Forex, also known as FX, or currency market is where you can trade currencies. The forex market isn’t centralized. It is, also, OTC or over-the-counter market. Here you can buy, sell, or exchange currencies at determined or current prices. So, it operates like any other market.

    What is stocks trading

    In short, it is the buying and selling of company stock – or derivative products based on company stock – in the hope of making a profit.
    Let’s go further!

    How to trade crypto

    Honestly, all of these types of investments are risky. Crypto gives greater growth than stocks or forex.

    You all know all about the Bitcoin. Well, Bitcoin isn’t the only digital currency that you can trade on the market. It is really the first and most popular one and is the real digital gold in the industry. The most important part behind cryptocurrencies is the technology that holds a large part of their value. The technology is what provides a safe way to identify a transaction and, also, the way to transfer currency or fiat money in exchange.

    If you want to trade crypto you need as first:

    1) A cryptocurrency wallet (or two).
    2) An exchange or platform to trade on.
    3) By using a bank account (find more HERE)

    There are only a few things, but important, you have to know about trading cryptocurrency.

    Trading cryptocurrency is simple to start, but there are some essential aspects to understand before you start trading and this is basic friendly advice to mull over, not professional investment advice.

    I’ll explain an example of Bitcoin.

    How to trade crypto

    Firstly, you’ll have to buy the underlying asset from an exchange or online broker.

    If you want to protect your Bitcoin, you must have underlying. That’s the best way. However, you’ll have to take some reasonable steps to reduce the risk of Bitcoin stealing and loss of private keys. The steps are simply a diversification of holdings across different wallets/storage types. Keep in mind that you’ll need two-factor authentication and strong passwords.

    Further, you can trade a CFDs derivative and hold a cash margin.
    If you want to trade on Bitcoin for a short or medium period find, use an online forex broker that will provide you 24-hour trading. Also, ask for the potentially lower margins, and also, the ability to go long or short. Choosing the right broker is very important. Your broker has to provide you the best trading tools and favorable commission rates.

    It is always smarter to buy a publicly listed security linked to Bitcoin and hold that shares with an online broker.

    Stock investors, investing in Bitcoin through listed security, for example, ETF or ETP, could be suitable. Especially for investors that prefer taking a passive position. More active traders might notice that the limited trading hours and possible lack of volume are limiting factors. That could limit their trading indeed.

    Overall, using listed securities that invest, track, or hold Bitcoin can be a viable alternative to diversify away from the risks of margin trading or safeguarding private keys when buying the underlying.

    How to trade forex

    You can trade currency based on what you think its value is, if you think a currency will increase in value, you can buy it. If you think it will decline, just sell it.
    In forex trading, you’re betting on the value of one currency against another.
    For example, EUR/USD, which is the most-traded currency pair in the world.
    EUR as the first in the pair is the base currency, while USD, as the second, is the counter. Read more HERE

    When you see a quoted price, that shows how’s much one euro worth in US dollars. Also, you’ll always see two prices. That is because one is the buy price and the other is the sale price. The difference between these two prices is the spread.
    When you choose to buy or sell, you are actually buying or selling the first currency in the pair.
    If you think the Euro will rise in value against the dollar, you buy EUR / USD. And vice versa, if you believe the Euro will drop, you sell EUR/USD.

    If prices are quoted to the hundredths of cents, how can you see any return on your investment when you trade forex?
    Leverage!
    When you trade forex you’re borrowing the first currency in the pair to buy or sell the second currency.
    To trade with leverage, you just set aside the necessary margin for your trade size. If you’re trading 200:1 leverage, for example, you can trade $2,000 in the market while only setting aside $10 in the margin in your trading account. Still, leverage will not just increase your profit potential. It can also increase your losses. If you are new to forex, you should always start trading with lower leverage ratios, until you feel comfortable in the market.

    How to trade stocks

    Stock markets are places where buyers and sellers of shares meet and decide on a price to trade.

    It is important to know that the corporations listed on stock markets do not buy and sell their own shares on a regular basis. You have to know that you\re not buying shares from the company, you are buying it from some other shareholder.

    There are many stock exchanges, many of which are linked together electronically which means markets are more efficient.

    The prices of shares on a stock are established through an auction process

    The prices of shares on a stock market can be set in a number of ways, but most of the most common way is through an auction process where buyers and sellers place bids and offer to buy or sell. A bid is a price at which somebody wishes to buy, and an offer (or ask) is the price at which somebody wishes to sell.

    When the bid and ask coincide, a trade is made. If there are many buyers and sellers at higher and lower prices, we say the market has good depth. Stocks are quoted by their ticker symbol, represented by between one and four capital letters, which are often loosely representative of the company name.

    Market orders are simply orders that direct your broker to buy or sell shares at the best possible price. A  market order doesn’t guarantee the price, but it does ensure that you’ll get the number of shares you require. When an order is completed, it is said to be filled.

    Stop orders are contingent on a certain price level being attained to activate the trade and your trade will be executed only when what you want to buy or sell reaches a particular price.

    If you understand how the financial markets are structured you can use the same skill and experience to profit in all three.

    It’s the same, you buy low and sell high against the crowd. There is no difference.