How to Make More Profit in Forex Trading

Forex trading has gained significant attention worldwide since 1990s when individuals and small investors get access to trade forex; while before 1990s, only big enterprise, banks, organizations or people invest a huge amount at a time are able to operate forex trading. As more and more people are anxious to rush into the forex market, there comes the question: What forex traders should know before starting forex trading? To get started in forex trading is not a difficult thing. All imperative things forex traders need to know or to prepare for forex trading are listed below

A laptop or a desktop with high speed internet connection is essential

Without any doubt, a laptop or a desktop is the basic device forex traders need in order to get started in forex trading. Moreover, computer with high speed internet connection is a must in order to get quick access to forex market and carry out online forex trading as quickly as possible. Furthermore, with the help of computer, traders can look through the internet and search for forex related information to improve their fundamental understanding of forex exchange rate, terms, strategies, skills and tips and so on, all of which are instrumental to becoming an excellent forex trader.

A reliable broker will help yield twice the result with half the effort

While the laptop is an imperative thing in forex trading, as I mentioned above; a respectable broker will aid forex traders to get what they want to know, for example forex strategies, analysis etc. because most top brokers as IKONprovides reliable forex platform for forex traders. Forex traders are able to open forex demo account to practice with and gain experience without opening their wallet.

Trading right currency pairs and trading in proper time is beneficial

After practicing with forex demo account, traders get skilled in forex trading and then can choose to trade forex for real. But there are many types of currencies at forex traders’ choice. So how to choose the best currency pairs for forex beginners? In general, most traders trade the most liquid seven currency pairs in the world, which are four “majors” and three commodity pairs.

Four majors: EUR/USD (euro/dollar), USD/JPY (dollar/Japanese yen), GBP/USD (British pound/dollar) and USD/CHF (dollar/Swiss franc)

Three commodity pairs: AUD/USD (Australian dollar/dollar), USD/CAD (dollar/Canadian dollar) and NZD/USD (New Zealand dollar/dollar)

Forex traders trade the seven currency pairs because they account for 95% of the total turnover of forex trading and are most active and liquid currency pairs in forex trading.

Then comes to the question of choosing the proper trade time after forex traders make decision on what currency pairs to trade. Generally speaking, the best trading time is up to the currency pair traded, for example, forex traders trade EUR/USD, GBP/USD and USD/CHF currency pairs had better trade between 8:00 am and 12:00 noon EST when markets for those currencies are active.

Starting small and taking no risk is imperative

Forex trading takes place in a big market where various forex are exchanged for many reasons. Some multinational companies exchange forex for payroll, merger etc, which only accounts for 20% of forex trading volume. Then forex traders may ask where the other 80% turnover in forex trading is from? The answer might be astonishing because the 80% forex trading volume is from forex speculation. Thus, Forex market is never a risk-free market; most market trend may go beyond traders’ expectation time to time, so as forex beginners who are not acquainted with the volatile market well, they should start small and play safe in forex trading

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Forex Tips-How to Keep a Good Psychology in Forex Trading

Before a competition, the coach may always remind the players of keeping a good psychology. With a perfect psychology state, players can play their skills to the most. This is also true in forex trading. The right psychological outlook can help forex traders face the issues and make sound decisions in the end. Therefore, in this article I will write about a list of useful forex tips on how to keep a good psychology in forex trading.

Forex tip 1: Never use the money needed for living to trade forex

A person puts 90% of his/ her property into forex trading, while another person 9%. Who will face a larger pressure? It’s obvious! The fear of losing almost all his/ her money will make investors highly nervous during each deal, which is most likely to bring improper operation in forex trading. Therefore, always remember a rule: live within your means.

Forex tip 2: Decentralize your investment

It’s not proper to trade with just one position. You can choose two to three currency pairs so that the risk will be scattered and your money will be in a better state.

Forex tip 3: React in time

Hesitation is a taboo in the changing forex market. Even a minute will mean a difference in the profit. Open a position at the very moment, and close it whenever needed, to do this, you can set a stop-loss order, which may somehow bring a feeling of security to your mind.

Forex Tip 4: Trade with a forex trading plan

Just like a GPS that tells you where to go, a forex trading plan will give you direction in the trading, and it will make your trading simpler than without one as you are clear about what to do in each period. Besides, a forex trading plan will help you control yourself in the heat moment, which is a way of preventing over-trading and irrational behaviors.

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What Forex Beginners should Know about Forex Market

What is forex market?

Forex market is an intangible market in which forex traders are able to buy, sell, exchange and speculate currencies. Forex market is made up of banks, commercial companies, forex brokers, hedge funds and investors. Forex market is considered to be the largest financial market in the world with trillions of dollars’ turnover each day.

The function of forex market

Forex market allows forex exchange, for example, forex traders can exchangeUSD for EUR in forex market according to the exchange rate. An import company may need to trade forex in order to pay for services or goods from other countries and an export company may need to exchange forex for their native currency. However, 5% of forex trading volume is from international trade and 95% is fromforex speculation. Thus, forex speculation accouts for a much larger part in forex market. In total, forex market is a transparent and fair market where forex traders are able to trade forex of different countries.

What are traded in forex market?

Forex trading is always done in pairs – Currency Pairs, one currency is bought and the other is simultaneously sold in forex market; for example, forex traders can exchange Euros for US dollars. If the Euro really rises in value, they can sell the position and get profits from forex market. So currency pairs are traded in forex market. There are three types of currency pairs: majors, crosses and exotics. “The Majors” include US Dollar, Japanese Yen, Euro, British Pound, Swiss Franc, Canadian Dollar and Australian Dollar, which are the most liquid currency and more than 85% of forex trading is traded with major currency pairs.

What are the most attractive advantages of forex market?

1. Forex market opens for 24 hours worldwide.
2. Forex market is a highly liquid market; the trading volume is 4 trillion dollars on a daily basis.
3. High leverage allowed in forex market makes it possible for forex traders to get huge profit.
4. Ability to get profit from a bull’s or a bear’s market.
5. Forex market is a huge and global market, making manipulation impossible.

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Economic Factors that Greatly Influence Forex Trading

Economic, political and military changes influence forex trading. In order to succeed in forex trading, it is better for forex traders to know these factors that can do great help in analyzing the market trend before they trade for real. The following are some economic factors that influence forex trading greatly.

Factor No.1: GDP

GDP, short for Gross domestic product, refers to the total amount of all of the goods and services produced in a country during a specific period. GDP is a main indicator of how healthy a country’s economy is. Usually, it is composed of four parts: business spending, government spending, private consumption and total net exports. GDP is a main economic factor that influences forex trading.

Factor No.2: interest rate

Interest rate is another economic factor that influences forex trading. If interest rates are increased in a country, it will enable the country’s currency to appreciate in value. So interest rate is a key economic factor in influencing forex trading.

Factor No.3: employment rate

Employment rate measures the percentage of people employed in a country. A higher employment rate means that a greater proportion of population is employed, which in general will have positive effects on the GDP per capita. Employment rate indicates the productivity of a country and is greatly related to gloom or boom of forex trading

Factor No.4: foreign trade

In a country, if import exceeds export, the currency of this country tends to decline and if export is bigger than import, the currency has the tendency to appreciate. Declining and appreciation of a currency has a great impact on forex trading.

Factor No.5: macroeconomic control

Forex traders should pay close attention to macroeconomic control of a country in forex trading. Macroeconomic control influences value of currency greatly, thus it has profound influences on forex trading.

Factor No.6: inflation

Inflation refers to rise in the general level of prices of goods and services in an economy over a period of time. When the general price level rises, each unit of currency buys fewer goods and services. For example, people could buy 10 steamed buns with 1 dollar in 2011 but in 2012, they can only get 5 steamed buns with 1 dollar. Inflation impacts on the value of a country’s currency, which is closely pertinent to forex trading.

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Forex Trading Plan-a Beacon Guiding Forex Traders to the Right Direction

It is better for everybody to make a plan before they take action. Forex trading is not an exception. Traders should first make a forex trading plan before they trade forex for real. We all know that forex market goes up and down, which may confuse forex traders now and then. A good trading plan is able to guide forex traders out of confusion. So what is a good forex trading plan and what should be included in a forex trading plan? I will list some vital things in a forex trading plan, but things are different from person to person greatly in a trading plan. The difference depends on many factors, for example: what forex traders want from trading forex and how much money they want to invest in trading?

A trading goal is necessary to a forex trading plan

A trading goal means what forex traders want to get from trading. for example:” I want to make enough money to buy a house” or “I want to get 5000$ to buy a present for my mom”., which are trading goals in a forex trading plan. No goal, no motivation. So remember to list what forex traders want from trading and always check how much they have achieved.

An outline of trading scheme is important to a forex trading plan

When making a forex trading plan, it is important for forex traders to make an outline of trading scheme. A trading scheme includes things such as the currency pairs to be traded, trading time; a trading scheme also contains the types of price trend analysis such as candlestick or line analysis etc.

Some trading strategies should be included in a forex trading plan

A forex trading plan cannot be a plan without some forex trading strategies. What strategies forex traders use is vital to profit-making. So it is wise to include some useful but simple trading strategies in a forex trading plan. When forex traders feel confused in trading, they can refer to the trading strategies and make correction.

A money management plan is also crucial

A money management plan is vital to a forex trading plan. A good money management plan helps forex traders to make more profit or decrease potential losses greatly. A money management plan includes how much money forex traders should invest in trading and how much they should keep in their account. For example, a forex trader decides to invest 5% of his account money into forex market and remain the rest 95% for reserve fund.

List shortcomings of forex traders is necessary

The shortcoming I mean is not like “I am short” or “I am dumb” etc. In a forex trading plan, the shortcomings I refered to are those tend to stop forex traders from getting profit. Shortcomings in a forex trading plan should include:” I am indecisive” or “I am impulsive” etc. Then why do forex traders list shortcomings in a forex trading plan? The answer is: by writing down shortcomings in a forex trading plan, forex traders can have a better understanding of their own characteristics or features. Thus they are able to alert themselves not to be affected by shortcomings in forex trading.

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How Many Types of Commonly-used Forex Trading Accounts

Different types of forex trading account are developed in order to cater to needs of different forex traders. In general, there are three types of commonly-used forex trading accounts:  forex micro account, forex mini account and standard account. Then what the difference among the three types of forex trading accounts and how to make choice from them? The answer will be demonstrated below:

Forex trading account No.1: forex micro account

If forex traders want to experience a live trading environment with a very small amount of money, forex micro account is a good choice. Mirco account allows traders to trade micro lots. A microlot is one hundredth of a standard lot. (One standard lot is 100,000 units of currency). So a micro account allows traders to trade 1,000 units of currency. In general, micro account lowers the threshold of market entry to the greatest extent. Forex micro account is a type of forex trading account popular with small forex investors and those who want to try out newforex trading strategy under real market condition.

Forex trading account No.2: forex mini account

Forex mini account is another type of forex trading account for forex traders who want to fund their account with small amount of money. A mini account allows traders to trade mini lots, which is 1 tenth of the size of a standard lot. So a mini account allows traders to trade 10,000 units of currency. A mini account is suitable for account balances over $10,000. Most forex brokers allow forex traders to open mini account. But do not believe those who promise traders to open a mini account with an extremely small amount of fund. Nearly all these accounts end up with a margin call. Mini account is a forex trading account suitable to forex beginners or traders who want to try their luck in forex trading but do not want to invest much money in forex trading account.

Forex trading account No.3: standard account

Standard account is the type of forex trading account designed for more experienced traders. Almost every top broker like IKON provides standard account. With a standard account, traders are able to trade 100,000 units of currency, 10 times of a mini account and 100 times of a micro account. Due to bigger lot and leverage used, forex traders using standard account are prone to get more profit or experience catastrophic losses. So a forex beginner without much experience should think twice before trading with standard account. Standard account is a type of forex trading account suitable to experienced forex traders.

Forex trading account No.4: forex managed account

Forex managed account is the online managed account service which specializes in managing the assets of account owners by independent money managers using an asset-based fee structure. We know that forex trading is popular and profitable. However, some traders fail to find enough time to trade and do not have the patience and skill to generate long term returns, especially in times of high volatility. A forex managed account offers private individuals participation in the forex market and the potential high returns without the need to spend the countless hours. But do not believe such announcements as getting rich overnight.

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8 Steps to Trade Forex for Forex Beginners

Forex market is in boom. A lot of people want to make good money in it but have no idea of how to trade forex. Some people may think that trading forex is easy. What they need to do is just investing some money into an account and then trading forex. As a matter of fact, forex trading is not so easy. Or else everyone can make a lot of money from forex market. Then, how to trade forex step by step? Forex beginners may find some clue from what I will state below:

Forex trading step No.1: do research on forex market

Before starting business, people always make research on the prospects of market in order to decide the possibility of making profit. In order to trade forex successfully, traders should first make research on the market perspective by various ways. If it is a promising market to trade forex, traders can move to the next step.

Forex trading step No.2: get educated in comprehensive forex knowledge

Once decided that the market has a bright future, forex traders should take some time to learn comprehensive forex knowledge. They should master forex fundamental knowledge like what forex is, forex terms, factors influence forex market, forex strategies, forex tips and so on. Forex traders had better learn as much as possible in order to handle future forex trading smoothly.

Forex trading step No.3: get a computer and speedy internet connection

Once fully prepared for forex trading, traders should first get a computer connected to speedy internet. A speedy internet connection enables traders to handle forex trading as quickly as possible, decreasing the possibility of losing valuable opportunities in forex trading.

Forex trading step No.4: choose a reliable forex broker and platform

Although there are many forex brokers and various platforms for forex traders to choose from, it is not easy to choose a reliable one. Going to forex forum, blogs etc. makes it easier to find the best broker and platform. IKON is regarded as a reliable forex broker who provides reliable platforms to a large number of forex traders.

Forex trading step No.5: open a demo account

Many forex beginners might be skeptical about demo account at first. But it really is a good way to practice forex trading if they try them. A forex demo account provides real time trading price and charts, extensive market analysis and market news. In total, a demo account offers all what a live account have. However, the difference is that traders do not need to trade with their real money if they use a demo account, thus they do not need to worry about losing their own money for lack of experience in forex trading. On the contrary, if they make a big fortune with a demo account, accordingly, they cannot withdraw and spend them.

Forex trading step No.6: make a proper forex trading plan

Making a forex trading plan is essential to traders before they trade for real. Without a proper forex trading plan is as a person walking without direction. Forex trading plan guides traders to the right direction when they are at a loss. Forex trading plan includes trading method, money management plan, loss control plan and emotion control plan etc. A forex plan may differ from one to another because of the difference in personal characteristics and amount of money etc. Forex traders should make a plan suitable to themselves.

Forex trading step No.7: trade forex for real

Once forex traders made a forex trading plan, they can experience live trading with a live account. There are some tips for forex beginners when they first start to trade for real. First, beginners had better not invest too much for fear of losing. They should increase investment after making sure that they can handle forex trading properly. Moreover, it is safer not to use too much leverage in forex trading for beginners because once they lose, they will lose a lot.

Forex trading step No.8: ceaseless education

When seeing the 8th step, forex beginners may get confused because I have already mentioned about forex education in the first step. But what I want to say is: if forex traders want to earn profit as much as possible, they should not stop their forex education. Perhaps one day, they are capable of being a forex expert for ceaseless education.

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