Beginning your career in Forex: Tips to remember

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It is no wonder that Forex is the biggest and the most attractive business market in the world. Millions of people are starting their career in Forex every day. If you want to trade in Forex, you do not need your office but you only need your computer connection and your strategy. When millions of people are trading in Forex, it might seem that all these people are having a good day. They are trading in the markets and although they can lose their money, they can be on track in Forex with a little hard work.

It is actually not that simple in Forex if you do not know the right way of trading. Most beginners in Forex lose their career after only a few months of trading because either they have no experience of the trading market or they have not quite get it right. They make many mistakes which are quite simple for them but deadly when you are a beginner. If you want to trade in Forex and thinking that you have a basic knowledge on the market, this article might come to your help if you want to avoid the mistakes that beginners make in their trading. It will not only give your career head starts but it will also improve your career smoothly in the market.

Sky is the limit

When you start your trading career you must wonder about the profit factor in this industry. To be honest there is no need to do the extensive calculation as you can easily understand the true benefit of professional trading just by observing the life of the successful Singaporean trader. Being an active trader you will be your boss and you set the limit for the potential loss or profit. However, trading is not all easy. In fact, this is not suitable for everyone. You need to trade this market in a relaxed environment so that you can take the perfect decision. Before you consider trading as your full-time profession it’s highly imperative that you consider demo trading account as your practice field. Never start your trading career with the real money since you might lose your entire trading capital. First of all, learn all the fundamentals of this market so that you can easily place your trade with an extreme level of confidence. Never take any risk which you can withstand. Find the perfect balance between your risk tolerance level and profit factor to survive in this industry.

Don’t start with live account

Many traders start trading in the market with all of the strategies they have got on the internet. It is a big mistake for you if you have just started your darer in Forex. You will see that there are lots of strategies for you but you cannot trade them in the live account when you are new. You should remember that it is an investment market where many traders lost their investment. You have to practice in your demo accounts to give you some foundation on the market trading. It will help you in your career and you can understand why demo accounts are here.

Choose a simple strategy for your beginning

There are many strategies that are used by professionals in Forex. Do not try to impress yourself and choose a simple strategy. If your strategy is simple and it works then it is not simple. Any strategy with a simple touch of your hard work and trading techniques can make your career bloom.

Never overtrade, never rush

This is the mistakes that beginners love to make. Do not overtrade in Forex as you are not going to make money if you have placed many trades in the market. Also, do not hurry. You need to be patient to give time to the markets to work out. Be disciplined in your trading and patient for your strategy to work.

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Understanding the Forex Market

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The trading of currencies on the open market serves many practical purposes. It enables individuals to purchase local coinage when visiting a different country or region. It allows governments to regulate the supply of money within their own economies. It also provides an opportunity for traders to realise a profit, simply by speculating on the price movements of different currency pairs. Each of these contributes to the vast size and scale of trading activity that occurs within the foreign exchange market every single day.

How big is the forex market?

The FOReign EXchange (forex) market is is the single largest financial market on the planet, when measured in daily trading volumes. Each day, around $5.3 trillion worth of currency is bought and sold on the open market. That equates to more than $220 billion of trading activity every hour.

The volume of forex trading far exceeds that of the bond market or the stock exchange – and even the economies of entire nations.

The New York stock exchange, for example, would have to trade for 30 days to match the single-day trading volume of the currency market. The combined annual GDP of Russia, Italy, and India is approximately equal to one day’s forex trading.

A brief history of forex trading

The trading of one currency for another is an ancient phenomenon, but the modern forex market truly emerged in 1971, with the completion of the Smithsonian Agreement.

The agreement allowed the central banks of ten major economies to buy, sell and issue currency in a way that would allow their money to fluctuate in value by 2.25 per cent against the US dollar. The Smithsonian Agreement is widely accepted as the first step towards the free floating exchange rates that we recognise today.

The proliferation of web-based technologies in the 1990s proved another significant milestone in shaping today’s forex markets. Access to the internet gave private individuals the means to not only access markets, but also the educational resources that would help them to understand forex, and how to start trading. Since the end of the 1990s, the number of forex trades that are executed through an online platform has grown exponentially: accounting for as much as 23 per cent of all forex activity by 2016.

Digital trading platforms have also eased the transition to an era of automated trading: where algorithms are used to calculate and execute trades far quicker than any human could hope to achieve. The forex market grew 20 per cent between 2007 and 2010 – and much of this expansion has been attributed to the development of high frequency, algorithmic trading machines.

Who are the big players?

This rapid expansion of the forex market has caused some of the established currencies and institutions to lose a degree of significance in recent history. Yet the biggest players in the foreign currency trade remain some of the more familiar names in the world of finance – for the time being, at least.

The most commonly traded currencies by share of total transactions are the US dollar (which accounts for more than 87 per cent of all trades), the Euro (31 per cent), and the Japanese Yen (almost 22 per cent). Of these, EUR/USD is the most commonly traded currency pair, accounting for 23 per cent of all trades in 2016.

International banks dominate forex trading: the largest six banks account for half of all transactions; the top ten banks are responsible for more than 65 per cent of trades. Citigroup (13 per cent), JP Morgan, (9 per cent), UBS (9 per cent), and Deutsche Bank (8 per cent) are the four most active financial institutions in the forex market.

Where is forex traded?

Asset 1 - Forex Market

Forex is a truly global marketplace. Four major trading centres – in London, New York, Tokyo and Sydney – provide access to the currency markets 24 hours a day. Of these, London sees the highest trading volume, accounting for 37 per cent of all currency trades.

However, while the City of London is responsible for a high percentage of daily total trades, it does not regulate or control the market in any way. In fact, the trade in foreign currency is not facilitated by any single authority or centralised exchange at all. Instead, traders can buy or sell currency pairs directly with other traders in the market. This form of direct exchange is known as an over-the-counter (OTC) market. OTC trading is considered one of the primary factors in the growth of forex: independent investors can access and participate in the market from any location, at any time of the day or night.

The foreign currency market has undergone dramatic change, and experienced rapid growth, throughout the past five decades. It has adapted its role to make use of new technologies: permitting free-floating currency valuations, and enabling private individuals to participate in markets without having to leave their homes.

Today, the forex market continues to evolve, and represents one of the most open and democratic trading opportunities on the planet. But the buying and selling of world currencies represents more than an investment: it is helping to make efficient world trade a reality.

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Always develop your trading strategy from the scratch

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There a lot of traders in forex industry who think that only they are smart and other traders do not know how to make money in an easy way. These smart traders do not like to work hard on developing their strategies and like the homemade strategies which are given for free on the websites of Forex. Though these websites swear all their strategies are best and you can make money with any of them, you will find that some of these strategies are not even strategies. They have only filled some space in their websites and trying to sell you whatever they can. Making and developing a strategy in Forex is not that easy. For an experienced trader, it takes years to make money and develop their strategies. To be precise nothing is ready made in the world of forex. Those who trade in Singapore knows very well that in order to make money they must educate themselves properly so that they can trade with precision.

So the question that arises in the minds of other traders who are reading this article is to how to develop my strategy? If the other strategies are wrong, is there any way I can develop my own strategy? This article contains the answers to your questions and as you read more, you will find many new things about Forex.

Build your strategy from scratch

If you are planning to develop your strategy, do not think you will take some strategy from many websites and you will try them all one by one. The strategy that gives you the most profit is your working strategy. You will no need to work on the market and you get yourself a developed strategy which works best.

If you want to be a professional trader in Forex, you have to build your strategy from the scratch. Have you ever seen a Michelin star restaurant how they prepare their own meal? From making pasta to preparing the spices, all the things are done by their chefs at the chicken. There is no chance for using any homemade spices which are not made by them. It is only for these reasons these restaurants can charge you thousands of dollars for having a one-course meal. If they bought all the spices and make homemade foods like other restaurants, they will not have earned those Michelin stars. Similarly, when it comes to trading you need to execute your trade in your online trading account with your own developed system. If you follow other people trading system then you will never be able to follow discipline. You need to find such a strategy which will suit your personality. And for this reason, the expert traders always suggest trading with a well-developed trading strategy based on the trader’s personality.

Facts about trading

Trading in Forex and becoming a legend player to live an exotic life will need you to make your strategy from the scratch. There is no website you should use to develop your strategy. Only take help when you do not understand. Use all your own things for making your own strategy for success. At your initial stage, you should use your demo trading account to build your own trading system. Instead of risking real money try with the virtual dollar so that you don’t face any financial loss. But in order to develop a winning system you need to educate yourself with the proper knowledge or else you will never be able to develop a solid trading system.

Summary: Building your won trading system is very hard especially if you are new to this industry. You need to use the demo account and trade with a reputed broker like Saxo. Make sure that you develop your trading system based on the major three types of analysis so that you can deal with the dynamic changes of the market.

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Rising popularity of short time frame trading in forex

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Traders who are scalping the market do not only trade the market to make a quick profit. There are also people in the market who scalps the market to check out this strategy. This strategy is highly rewarding to successful traders in the market who can understand the market trend. If you are a new trader and want to make a lot of money, you can start scalping. It is not a good choice for the new people in forex to scalp as their main strategy. There are many long-term strategies in the market and you should follow these strategies to make a profit in your beginner account. Also, you need to have a lot of money in your account to scalp the market. The professional scalpers at Singapore always trade with a huge trading capital since they know in order to reduce the risk exposure in short time frame trading they will need a decent balance. But a big trading account is not going to ensure your profit factors in this industry. As short time frame trader, you must have a very clear knowledge in this industry.

Why traders scalp in forex?

Most of the traders prefer scalping in the forex trading industry since it allows them to book their profit in the market very quickly. Unlike the long term traders, they don’t wait for days and weeks to lock their profit in the market. They simply execute high lot size trade in the market and within hours they close the trades either with profit or loss. But in order to become a profitable short time frame trader, you must have a very clear understanding of the basic of the forex market or else it will be extremely difficult for you to survive in the long run.

They are greedy: Not all, but most of the traders who scalp the market are greedy. It is not that every trader who uses this strategy are greedy, but most of them are. Many interested people who haven’t opened a Forex account have heard of scalping and how easy it is to make money in Forex. To them, scalping is the only way to become rich in Forex. Out of greed, many traders scalp in forex. However there some expert traders trading CFDs with an extreme level of precision in the short time frame. If you want to become such an expert then you need to learn the fundamental and technical analysis very precisely. A single mistake is enough to wipe your entire trading account in the market.

Think of this strategy as a quick rich scheme: Many traders also want to get rich quickly. They have been looking for a perfect strategy where they can make money quickly in their accounts and do not have to trade all day. Scalping is their answer. They think of this strategy as some quick rich scheme in the market of Forex.

Know the markets: traders who scalp are very experienced. They can understand the market in any second. They trade the market in a very short timeframe and they do not need hours to figure out the market. With experience and knowledge, they can tell where the market will go. They trade the market for this reason to use their experience to make quick money.

Love fast results: if you love fast results, you will love scalping. Traders want to make money quickly in the market. Scalping gives them this opportunity. Though there are risks, the professional traders trade with this strategy. The fast result of scalping is one of the reasons it has become popular among the traders though it has many bad sides in trading.

Summary: Trading is nothing but running a sophisticated business. As a professional trader, you will always have some losing trades but you need to learn to take managed risk in the market. Always try to execute your orders by using rational logic. Last but not the least try to trade in favor of the long-term prevailing trend.

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Secrets to becoming a profitable trader in the forex market

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Every single day the number of retail traders in the forex market is increasing at an exponential rate. If you look at the professional traders then you will see that every single one of them is trading the live assets after learning the market basics perfectly. Unlike the professional traders at Saxo, the novice traders consider forex trading as a get rich quick scheme and ultimately lose money in real life trading. Forex trading Singapore is very much popular nowadays since most of the retail traders are well aware of the profit potential of this high leverage market. Though the market offers an extreme level of profit potential but the success rate in the forex market is extremely low. In this article, we will discuss the secrets of becoming a profitable trader in the market.

Solid trading discipline: The forex market is a high volatile market and in order to make a profit in the financial market you need to have a solid trading discipline. Most of the novice traders are losing money in the financial market since they don’t trade the live assets with strict trading discipline. The experts in the forex market always execute their orders by following proper trading discipline since they know this is one of the key ingredients to remain profitable in the forex market. If you look at forex trading Singapore then you will notice that the rookie traders are even making a decent income at the end of the month due to their strict trading discipline. So if you think trading as your full-time profession then make sure that you trade with an extreme level of discipline.

Develop a solid trading system: Every single second the price of certain assets in the financial second is changing. The professional traders use this fluctuation of the price and make money in the online trading world. Forex trading Singapore is now very much popular since most of the traders know very precisely how to execute the perfect orders in the market. But in order to develop a perfect trading system in the market, you need to have a very clear understanding of the financial factors and technical analysis. Try to read as many articles as you can since it will enhance your trading knowledge in the market.

Perfect risk management factors

Some of you might often ask is there any holy grail in the forex market. The simple answer to this question is, YES. In the eyes of trained professional perfect risk management factors is considered to be Holy Grail in the forex market. As a professional trader, you should always make sure that your winners are bigger than you losers in the market. Most of the novice traders in the financial market tends to lose their patience and trading discipline after incurring few consecutive losses. But if you look at the expert traders then you will notice that every single one of them is following proper risk management factors in every single trade since they know it’s the key ingredient to becoming profitable in the long run.

Summary: Trading the financial instrument is an art and it requires pin perfect execution of the trading plan. If you truly want to become a professional trader in the forex market then make sure that you follow the above-mentioned tips in this article. It’s true that you will often have some losing orders in the market but you need to make sure that you are still holding your trading discipline very strictly. And always try to trade in favor of the long-term trend in the market with price action confirmation signal to reduce the risk exposure.

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