A huge section of youngsters are joining the market as the trade volume crosses 4 trillion dollar mark everyday around the globe which about 53 times the trade volume of New York stock market. Just like every other field it is equally important for the Forex beginners to understand all the minute details of the market before entering it.

Currencies of every country are different and they can be converted from one to another depending upon the exchange rate at the time of purchase. The financial system called Forex involving conversion of one currency into another is biggest in the world.

There are lot of advantages like there is no middleman, so all the profit earned is not shared. An amount as low as 25$ can be invested in a deal though it is not suggested and the market remains open 24hours so it is possible to trade as part time job because new comers are can open mini or micro accounts. A demo account is also a good option to practise before entering a real deal.

The basic nature of this market is that there is no central management so no one can control it. There is always an opportunity to gain money whether the market is moving up or down but not profitable when it is stagnant. One should try not to hold a sum with him for longer as it should be kept moving.

Whole world is divided into four parts and traders from that part are allowed to work in that period only. The four parts are Sydney, Tokyo, New York and London and for a fixed interval two markets works together so it is good time for trading.

All the dealing is governed by the exchange rates which show the proportion of a pair of currency. These rates keep on flickering and the trader is in profit when exchange rates are increased.

The exchange rate is given as ‘a/b’ where it shows the units of b currency needed to purchase the b units. Here ‘a’ i.e. base currency is long by giving ‘b’ quote currency. Long means to purchase and short is used for sale.

There is a fact that bid is always lower than ask. Bid is the value at which you can sell your base currency and ask is the amount at which you can purchase it. But before entering any deal you should learn to analyse market completely which can be done on three basis namely, sentimental, fundamental and technical analysis.

Equilibrium between the three analyses is necessary to judge fairly so that a trader can stick on his rulebook. For which the rules should be framed correctly which depends on individual and cannot be spoon fed.

Adam has been trading forexfor 5 years and until recently with Not Much success. Adam recently joined The World Forex Club where he has gained the Forex Education that he needed to sky rocket his earnings in the forex market.. This article, Important Information for Forex beginners has free reprint rights.

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Filed under: Currency Trading

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