Tag: FX

  • Forex trading for a living – How and Why

    Forex trading for a living – How and Why

    3 min read

    Forex market - The differences with other markets 1
    Forex trading for a living is valid for retail investors. Well, that means that trading Forex for a living is possible. The trouble for most people is that they commonly lack the needed trading skill, steadiness, training, or pragmatic mindset to make it trading Forex full time.

    The Forex market is the most liquid market in the world. There are various shareholders from across the world trading in it.
    Thanks to the Internet Forex trading is accessible for almost anyone. This means the market is no longer for the sharks of investment banks and multinational companies.

    From some reasons, forex trading has a bad reputation. The reasons are well-known. Scam artists and brokers that trade against their customers are the main reason for that.

    But for some people, forex trading for a living is a way of life and profession as well.

    Can you trading Forex market for a living

    Ambitious traders often ask is it really possible to make a living trading the Forex market.

    The answer is yes.

    But we owe you a true answer.

    Yes, you can be trading Forex market but you have to do a lot of things in a proper way.

    The key is simple. You have to learn to become a profitable trader and then act.

    Easier said than done. But, you can be trading Forex market for a living, and we personally know people who make steady money in the markets.

    So, there are no barriers.

    So, what it takes to be able to trading Forex for a living?

    To do so, however, you have to put a large number of banknotes on the market, and trading them regularly.

    How much money do you need for Forex trading for a living?

    Forex market - The differences with other markets 3
    If you want to make a living trading the Forex market is sufficient starting capital. If you don’t have enough you have to accept that you will not be making a living from trading Forex quickly.

    The exact amount of money to trade full-time is different for everyone. Generally speaking, you will need a nice amount of money at your disposal. Of course, in order to trade a large position size and make enough money.

    And, at the same time, not risking too much of your account on any one trade.

    Maybe you should start as a part-time trader for extra income. It is easier to achieve in the early stages of your trading work. Instead of putting pressure on yourself to make a lot of money fast, you should focus on creating a consistently profitable track record and self-confidence.

    And the money will come.

    It is interesting, even when you have a large amount of money to trade with, if you do not focus on the principles of successful Forex trading, you will lose anyway.

    How should you start Forex trading for a living?

    Gradually! Perhaps it will take about six months to get the basic knowledge and understand how everything works.

    You have to read a lot of trading literature at the time, for instance. Maybe you will talk to traders on different forums, exchange notes and ideas for the strategies and ask a lot of questions. That will be a good way to learn

    This community will answer your questions and help you understand a lot of the most difficult theories.

    Then, you should start with a demo account.

    There you will trade without real money involved.

    It’s a good plan to feel the stress of actual trading but you will not risk your real money.

    You should practice trading a couple of weeks, getting how to use it, and then start an account with real money. Honestly, some traders think that trading with real money is the only way to learn.

    It is a good idea to start with a small account. For example, with $20 or $25. If you gain a profit quickly, don’t worry, you will lose it faster. But it will be a good lesson.

    You will realize what ‘risk management’ really is and why traders think that it’s important. So, go back to the books, and try to develop your own trading strategy.

    Real trading will start later, on a standard account with a $500 deposit, for example.

    Basic paths on Forex trading for a living

    Each path has its advantages and disadvantages. It’s up to you to consider each of them before you decide for forex trading for a living.

    You have to prove to yourself that you are able to make money trading forex.

    This means, you can make money consistently and you’ve increased your skills to be a successful forex trader.

    After you recognize this rule, you can start to trade full time.

    If you have a day job, it can be quite a challenge to trade forex full time.

    In that case, you have a good cash defense to keep you going for some time.

    Actually, you need to have some cash saved. The ideal situation is to have at least 2 years worth of cash to live on.

    This may give you a stress-free trading environment from the start.

    The determination to succeed is another path.

    This is when you’ve started making some good amount of money and you think you can do it as a full-time thing.

    Or maybe you already have enough money in the bank and forex trading forms an only little part of that.

    For example, you have $200,000 cash in the bank and you put in $70,000 to start trading forex full time.

    The $200,000 is for you to live, as a reserve, whilst that $70,000 trading account is what you try to make your living on. That’s why you might want to put that amount on Forex trading for a living.

    The truth is, you need to very carefully consider all your options before you jump into the Forex market.

    Frankly, you have only two options: you can succeed or you can fail.

    Why do people decide for Forex trading for a Living?

    For the money, of course!  

    We are not going to lie. People get into trading because they want to make large amounts of money and travel the world doing it. Some people trade because they obsessively love it and it is a part of their identity.  

    So, the reasons can be very different.

    Lots of people have heard stories about people coming to the Forex market and making a killing overnight.  Maybe some of those stories are what set you out on your journey to trading Forex for a living. Those stories can be true, but what they have forgotten to mention is that behind such success are the years of hard work and fight. It isn’t easy to make it to the top.

    What tools do you need for Forex trading for a living?

    Education. This is a big topic to consider. You can read our tutorials. If you know nothing about Forex trading then this is probably the best place to start your learning journey.

    Broker and trading account. Also, you can find all about the best platforms and brokerages on our Wall of Fame.

    Good platform. Once you sign up with some broker of your choice (check out our broker review page HERE.) you then need to download and install the platform. And if you are into algorithms their platform will suit you. Try using a demo account first so that you can learn how to use the platform properly.

    Forex Trading Program - How To Choose The Most Useful 5

    The bottom line

    Here are all the basics that you need to get started Forex trading for a living. It’s up to you to do the work and put in the time. Trading for a living requires a lot of hard work, enthusiasm, and commitment to make it work.  

    You have to be firm to make it work even in the times when something is going wrong.

    But, if you give it your all, the rewards at the other end are unquestionably worth it. When you approach trading with the respect and commitment it deserves then you can live the dream of Forex trading for a living.

    Don’t waste your money!

     risk disclosure

  • Is Forex trading profitable? What Is it the truth?

    Is Forex trading profitable? What Is it the truth?

    Forex market - The differences with other markets 1How Forex trading can change your life?

    By Guy Avtalyon

    One reasonable question that comes up a lot is: Is Forex trading profitable? So many times this question comes from traders or people that want to get into the Forex market.  

    That’s because only 5% of traders are successful.

    The others cannot find any success with their tradings.  Maybe they are not able to recognize the right approach
    When we say “trading approach”, we don’t just mean their trading strategy.

    Your trading approach is much more than a trading strategy and we will cover that later.

    The brief answer is yes. Forex trading is profitable. The trading in the Forex market is profitable but chances are you won’t make any money.

    If you do not understand the risk or you don’t know how to manage your trades in the right way, you will lose. Let’s say, if you are risking too much per trade to resist a series of losing trades, you will be out of trading faster than you can imagine.

    If you continue to move your stops to avoid a loss, you will finally lose your account.  Only your broker will be happy. 

    You can become a profitable Forex trader but it depends on several factors. Some of those you can control, and others you can’t.

    Everyone comes to the forex market for a reason. Some come solely for entertainment, the others to become a professional trader.

    However, the good news is that there are things you can do to speed up the process. In other words, you can learn from other traders’ mistakes.

    Is Forex trading profitable?

    The fact is that many investors haven’t had the success trading Forex they had imagined. Their experiences cast a bit of doubt on its viability as an investment choice.

    Nevertheless, for a market that trades around $5 trillion daily in volume, it stands to reason that there are traders profiting from Forex trading. Otherwise, people would avoid the Forex market. But it is not the case.

    The right question to ask is how to trade Forex profitably and how to be systematically gain a profit in Forex.

    So, Forex trading is profitable if you have to know how to achieve it.

    How to make money trading Forex?

    In the forex market, you simply buy and sell currencies.

    Placing a trade is simple. The modus operandi of trade is very similar to other financial markets, for example like the stock market. So, if you have any experience in trading, you should be able to set it pretty quickly.

    The aim of forex trading is to exchange one currency for another in the expectation that the price will change.

    Forex trading is profitable - Is it the truth?Most popular currency pairs

    More concretely, that the currency you bought will increase in value compared to the one you sold. If you are applying the trading plan in a consistent way, you should be able to receive the rewards from your trading plan.

    Will you always win in Forex trading?

    No.

    You will take a loss and many in a row.  You will see your account varies. It can be depressing to see sometimes.

    The vision of your trading system is what should keep you fixed to your trading plan even when an equity curve going down.

    Yes, you will have losing days. These are the facts of trading.

    If you are asking about being profitable over the long run, the answer is yes. But only if you are trading a positive outlook trading strategy.

    One month of not being profitable does not make for the trading fiasco. It is assumed.  

    You must predict and plan to lose, and also, you have to assume that you will face the biggest loss of your trading work in the future. Expect that a multiple of risk loss is just around the corner.

    It will remind you that the biggest trading job is to protect your trading capital.

    You must have 3 things on your mind. Always.

    Forex trading is it worth it?

    Forex trading isn’t a get rich quick opportunity.

    Opposite to what you’ve read, Forex trading is not going to take your $5,000 account and turn it into millions. The volume we can earn is defined by the sum of money we are risking.

    The old saying “It takes money to make money” is exactly what Forex trading related to. Of course, that doesn’t mean it is not a profitable venture.

    You have to know, there are many successful Forex traders that trade for a living.

    How do they do it?

    They have gradually improved over time and increased their account to a level that can create a sustainable income.

    Have you heard about traders that are targeting 50%,  or 100% profit per month?  Yes, but the risk they are taking on is going to be pretty comparable to the profit they are targeting.  In short, in order to attempt to make a 50% profit in a month, you have to be prepared to see a loss of around 50% of your account.

    Even if you trade with an edge. Your return should be positive, but without leverage, it is going to be a small amount.

    Forcing leverage into the mix is how traders attempt to target extreme gains. In turn, it is how traders can produce extreme losses. Yes, leverage is beneficial up to point. But there is one danger possible, it can turn a winning strategy into a loser.

    Trading Forex with leverage

    The leverage as a winning strategy to lose money But extreme leverage can ruin a profitable strategy.

    Most novices minimize the possibility that loss leverage can ruin their accounts.

    Understanding leverage enough to know when to use it and when not to use it is important to your performance!

    Leverage is a very great tool but some traders use it to damage their trading capital. It is because they take their destructive force too easily or ignore it completely. Anyway, high leverage is something that most of the forex broker will like, it’s their preferred selling point.

    They’ll tell that you can make a huge gain using huge leverage. Even one pip is important to them. But you have to know that you could easily be destroyed by huge leverage also.

    Let’s say you have a coin that may earn $4 if it hit the heads. But when tails are hit, you will lose $2.

    Would you like to flip that coin?

    We guess you would flip that coin.

    Let’s see a different example.

    Let’s say you placed the trades by following some other trader’s acting. And she or he ended up with higher equity relative to you. That trader’s net profit/loss (P/L) was positive while your P/L was negative.

    There are two main points.

    When you have a losing trade, high degrees of leverage destroy your capital base. Moreover, it is forcing you to change your future trade sizes or deposit more funds.

    If you have a conservative approach and use the amounts of leverage according to that trading style, your equity P/L tracks your net pips P/L. Though you place trades in hopes of it working out in our favor, you must be prepared if it doesn’t.

    Part of that preparation is a result of managing an appropriate amount of leverage.

    Using sentiment can shift the odds in your favor

    Actually, we are talking about using the Speculative Sentiment Index (SSI). You can find a lot of articles on this subject.
    You can find that it is the best tool ever used. And it a part of almost every trading strategy that experienced traders use.
    SSI is a free tool that tells us how many traders are long compared to how many traders are short each major currency pair.
    What does it mean?

    It means to be used as a contrarian index where you want to do the opposite of what everyone else is doing.
    Using it for your trades you can turn around your work as a trader and become more successful.

    The bottom line

    When you ask if Forex trading is profitable, you must have all of this on your mind.

    If there is one word to describe the best trader, it would be – consistency.

    Trading currencies are all about implementing a trading plan. With consistency. Traders that do everything in a consistent way are holding to a proven edge. It is difficult to find the right way if you are constantly switching speed.

    Once again, Forex trading is profitable.

    Don’t waste your money! Do smart trading.
     

  • What is the Forex Market?

    What is the Forex Market?

    2 min read

    What is the Forex Market? 2
    What is the Forex market? Actually simply. It’s the global market that provides the exchange of one currency for another.

    Also known as foreign exchange, FX or currency trading is a decentralized global market where all the world’s currencies trade.

    The forex market is the biggest, most liquid global market with an average daily trading volume exceeding $5 trillion. All the world’s stock markets together can’t even come close to this. But what does that really mean?

    Forex has no centralized market. Instead, an Forex market exists wherever the trade of two foreign currencies are taking place.
    Do you know it is open 24 hours a day, five days a week? Forex exists to handle investment and trade. The main trading centers are London, Paris, New York, Tokyo, Zurich, Frankfurt, Sydney, and Singapore.

    All levels of traders, from central banks to speculators, trade currencies with one another.

    The Foreign Exchange market, also called FOREX or FX, is the most exciting financial market in the world.

    Whether you sell $100 to buy YEN or a bank exchange $200 million for EURO with another bank, we are speaking about Forex deals. The participants on the FOREX market range from huge financial organizations trading billions, to people trading a few hundred dollars.

    Without this tool in place, foreign trade and investment would be obstructed. The major players on this field are the U.S. dollar, the British pound, and the euro. This machinery provides a clearinghouse to trade those major currencies.

    Thanks to the internet, you can trade on the FOREX market the way traders from the largest banks and investment funds do.
    All you need to get started is a computer with internet access and a trading account with a Forex broker.

    If you’ve ever traveled to some foreign country, you’ve made a forex transaction. Take a trip to Germany and you convert your dollars or some other currency into euros. When you do so, the forex exchange rate between the two currencies determines how many euros you get for your dollars. And the exchange rate fluctuates continuously because, this market, like many others, is based on supply and demand.

    How does Forex market work?

    On the Forex market, one currency is exchanged for another. The single most important thing with respect to the Forex market is the exchange rate between two currencies (a currency pair).

    You’ve probably seen it on the news or somewhere on the internet:

    What is the Forex Market?

    And you noticed the small changes if you paid attention. This small change may not seem like a big deal.

    But think of it on a larger scale.

    A giant international company may need to pay abroad employees. Imagine what that could do if simply exchanging one currency for another cost you more depending on when you do it? These few coins add up quickly. In both cases, you may want to hold your money until the forex exchange rate is more favorable.

    An exchange rate can experience prompt changes. Sometimes several times a second. So there’s a lot of activity going on 24 hours a day, 5 days a week.

    In overall, the currency exchange rate reflects the health of an economy in comparison to others. If the economies of the Eurozone are doing better than the US economy, the euro will go up compared to the dollar and vice-versa.

    You can trade currency based on what you think its value is. Just like stocks. But the difference with forex is that you can trade up or down just as easily. If you think a currency will increase in value, you can buy it.

    If you think it will decrease, you can sell it.

    Honestly, finding a buyer when you’re selling and a seller when you’re buying is much easier than in other markets. Maybe you hear on the news that Australia (this is just an example, don’t worry) is devaluing its currency to attract more foreign interest into its country. If you think that trend will continue, you could make a forex trade by selling the Australian dollar currency against, say, the US dollar. The more the Australian dollar devalues against the US dollar, the higher your profits. If the Australian dollar increases in value while you have a sell position open, then your losses increase. Hence, you will like to get out of the trade.

    In the moment of writing this post the chart looks like this:

    What is the Forex Market? 1

    When people talk about the “market”, they usually mean the stock market. So the NYSE, for example, sounds big.
    But if you compare it to the forex market, it would look like this:

    The currency market is over 200 times bigger!

    The tremendous number of $5 trillion covers the complete global foreign exchange market. But daily trading volume from retail traders makes up between 5-6% of overall volume, or between $300-400 billion. So, you see. It isn’t so big.

    The forex market is unmistakably huge, but not as huge as the others would like you to believe.

    Just to be honest.

    And remember’!

    Don’t waste your money!

    risk disclosure