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Forex trading definition

Forex trading is a process of buying and selling, meaning that one currency is bought or sold in exchange for another in addition to commodities and indices. itself, but must be purchased in another currency, and the trader enters this market through the broker, who provides him with the platforms that connect him to the market, and the forex market has rules that the trader must follow to ensure his continuity in the market, and the trader when trading forex must pay attention to fundamental analysis and technical analysis in addition to For the economic calendar, the forex market is divided into bears and bulls, with bears representing sellers and bulls representing buyers.

How to trade forex
How to trade forex

Base currency and the counter currency

To trade forex correctly, you must know all the details and basics before entering the forex market, and among these basics are currency pairs, there are major currencies such as the euro and the pound sterling and emerging market currencies such as the Turkish lira and the Chinese yuan, and currency pairs are a base currency and a counter currency, for example, EUR/USD the currency that To the left of the dash, the euro, is the base currency, while the currency to the right of the dash, the dollar, is a counter currency. The Australian dollar is the base currency against the US dollar, while the euro is the base currency against the British pound.

How to trade forex

Each trader must carefully choose the brokerage company, which in turn will link him to the market through the trading platforms, and most brokerage companies give their clients a free demo account through which the customer can trade like other traders, but without risks in order to understand the principle of the market’s work, and it must be noted that any trader must have One of the things that are agreed upon with the broker is the leverage, and the financial leverage enables the trader to enter the market with a small amount of money in his account because it doubles the capital according to the strength of the financial leverage to control a larger amount of money In the market, the use of the financial companion has advantages and disadvantages as it enables the trader to earn large sums of money, but in return the risk and loss ratio is high, so the financial leverage must be used wisely and knowing how to manage the capital by activating the stop loss order, and in sum, forex trading is done through Choosing the right brokerage company, which in turn connects the trader to the market through trading platforms, and the most famous of these platforms is the MetaTrader platform, through which the decision is taken Buy or sell after reviewing the economic calendar and technical analysis of the target currency pair.

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