Learn More on the MT4 Fx Trading Platform

Becoming a smart trader in the forex market entails a lot of experience and know-how to learn how to minimize losses and maximize your income. Here are five basic steps that will kick-start your way to forex trading:

Educate yourself with Forex trading

Learning the theories before applying it is a fail-safe solution to starting your trading career. Forex trading only needs less understanding of the forex market but it does take time to familiarize yourself with it. Forex trading is not  tantamount to gambling. It has own rules and as a trader, getting all the knowledge from different resources will equip you in making the right decisions.

Select a broker

A broker is simply the middleman between the trader and the market. A broker provides currency traders access to a trading platform that gives them the option to buy and sell foreign currencies. When choosing a broker, consider these things:

Reputation

A forex broker’s reputation also tells its stability as an intermediary between the trader and the market. You can look them up online or research about i before selecting one.

License

Check for certifications and make sure they are valid.

Trading terms

Check for the kind of trading accounts being offered. Is it spread, leverage, initial deposit or commission?

Software

What kind of trading system or platform a broker can use? See if they have versions for mobile and brow

Support

A broker’s response is one way to tell if it is the right one or not. Try contacting the broker’s support team and assess if they respond appropriately and provide great customer service.

Security and reliability

If the URL has HTTPS protocol, then it’s a good one. In case you are using Chrome or Mozilla, you will see a green padlock to the address bar which means you have a secure connection. It is required both for password entry and payment pages.

Practice trading using a demo account

To apply theories you have learned about forex trading, practicing trading using a demo account helps. There are many trading platforms available online that allows you to trade using virtual money.

Open your own trading account

After trying on the simulation with a demo account, you are now ready to start your trading account found on the broker’s website.

Install a trading platform

The last step before starting your trading activity is to install a trading platform. You can choose any software like MetaTrader 4 and ZuluTrade.

Forex trading is quite interesting once you get the hang of it. But before even considering to open a trading account, first let’s go over some technical jargons or terms that you might run into when trading with forex.

1.PIP –you will often hear traders say this or see such term on any forex trading site. It means “Percentage In Point” or also referred to as Point. It is the most fundamental unit of measure used when trading currencies.

PIP is the minimum price change of a Forex trading rate. The most common Pip is 0.0001.

2. Ask price – in the context of forex trading, ask price is the price you can buy a currency pair at. It is the price at which the trading market is willing to sell the currency to you. It’s basically the minimum price that you are willing to receive as a seller.

3. Bid price – The bid price is the price that you can sell a currency pair at. It’s the maximum price that a buyer is willing to pay.

4. Spreads – Spreads are the difference between bid price and ask price and is parallel to trading cost. If the spread is tight, the trading cost is low. If the spread is wide, the trading cost is high. 

5. Currency rate – This is the price/rate of a nation’s currency.

6. Market order – When you place an order either you are buying or selling, there are two fundamental execution options namely:  place the order at market or at limit. Market orders – these transactions are to be execute fast with the current market price.

7. A limit order – sets either the maximum or minimum price in which you’re willing to buy or sell and lets you put a specification on the trade entry price.

8. Leverage – is the ability to control a large amount of money in the forex markets. It allows the trader to make meaningful profits on the normally miniscule daily currency movements while risking only minimal capital on a given position.

Leverage may exponentially increase your profits as well as your losses so it is very important that traders be careful when using leverage.

9. Margin – Margin is the amount of money required in your account in order to open a trade. It is calculated based on the current market quote of the base currency of the trader’s account versus the base currency of the trader’s account, the volume requested, and the leverage level of the trader’s account.

The formula for margin is: (Current Market Quote * Volume) / Leverage = $Margin Required10. Expert Advisor (EA) – is basically an electronic system that you install onto the platform that automatically follows a trader’s instructions after meeting a certain criteria. In a simpler sense, it will do the trading without the trader touching the computer or mobile phone.

If you are just a beginner and still a little bit overwhelmed in the forex market, this post is for you. I have scoured the internet to find the most helpful sites to guide newbies with their trading career.

Abnormal Returns

Abnormal Returns is a “forecast-free investment blog” which has been up and running for a couple of years and provides a clear picture about what financial trading is.

Investing

Investing.com is a famous global financial portal owned by Fusion Media Limited and provides real time quotes for free

Daily FX

DailyFX is one of the world’s leading site for forex trading that provides comprehensive review, news on global financial markets and analysis. It offers every tool you need to trade in the foreign exchange market.

Forex Magnates

Finance Magnates was known as Forex Magnates which had its initial focus on the Forex B2B sphere. It is the world’s only multi-asset online trading knowledge hub. Finance Magnates literally caters to the trading needs of the entire global trading industry.

FX Street

FX Street is a leading source for real time forex analysis where you can get the information you need to make the best decisions in the currency markets.

Baby Pips

Baby Pips is the most common go-to site and one of the top viewed traders educational site and community. It has established itself as the premier destination on the web for learning how to trade the Forex market.

Investopedia

Investopedia is also a leading source of financial content and provides easy to understand articles and the basics about forex trading.

Forex Factory

Forex Factory provides high-quality information that traders can apply in starting their trading career

Earn Forex

Earn Forex is a helpful website that provides visitors with tools and information to become successful Forex traders. They explain the basics of Forex trading, giving you free e-books and articles that help to learn more about trading and offer online calculators, downloadable indicators, and free expert advisors.

Trading Economics

Trading Economics is also an excellent website because it provides readers with precise information covering 232 countries from around the world.

A Forex trading platform is the lifeline in forex trading. It enables both investors and traders to place trades and check accounts through a middleman that facilitates financial transactions or more commonly called as financial intermediaries. There are a lot of available online trading platforms that you can find on the internet but it all comes down to which platform has the best features and services. Some trading platforms offer bundles features like real-time quotes, charting tools, news feeds and so on.

Before selecting your trading platform, you should consider the following:

• fees –  how much fees are you going to spend for that particular platform?
• features – what can this trading platform offer that sets it apart from others

Here’s a list of popular online trading platforms that most forex traders use (in no particular order):

MetaTrader 4

MetaTrader 4 is one of the most popular Forex trading platforms for trading because it is simple to use and has the ability to be fully customized through Expert Advisors. It is predicted that over 70% of all retail Forex trading is done via the MT4 platform.

Oanda fxTrade

fxTrade is also a reliable trading platform for manual, self directed traders. Recently, it has been fully integrated with Tradingview, which offers robust HTML5 charting.

cTrader 

cTrader is the main rival to the MT4 platform as the best Fx trading platform. It offers a complete market depth so traders know exactly how much liquidity is available at each price. This helps with slippage, which can be an important factor when trading Forex and selecting a Forex trading platform to trade on.

MT5

The MT5 platform is the updated version of MT4. It was designed as a multi-asset trading platform allowing for trading on Forex, CFDs, Futures, and Equities. It has been fully integrated with multiple Forex and Futures brokers so there are plenty of clearing firms to choose from.

Ally Invest

Ally Invest offers very minimal flat-rate fee. Because it offers low trading costs and a user-friendly platform, Ally Invest delivers good value for both novice and experienced traders, but this is not really recommended for newbie traders because of it does not offer trading simulator and investment training.

Getting into forex trading is like sending yourself in a battlefield of financial complexities. You must be equipped with the necessary tools before you start. Creating a strategy in forex trading will helps guide you in making objective approaches to help you beat the market. Trading should be done on the grounds of tested strategies rather than relying on a trader’s  hunch. There are strategies that designed to help you gain long-term profits. To gear you up in the world of forex trading and consistently make money, here’s a rundown of winning strategies that you can use:

Strategy 1 – Your FUNDS and Your ATTITUDE

Set the capital that you want to allocate to your forex trading, set the profit target you want to achieve on a specific date, establish the proportion of your capital that you are willing to risk on every single trade and identify your ideal risk-reward ratio or the level of return you want to target in each trade. Your strategy will depend primarily on your funds and your willingness to risk those funds. Your attitude is also a key player in making your money grow. You can play safe or go all-in. Whether you are aiming for a high return targeting a smaller return depends on your money management strategy.

Strategy 2 – Limited Currency Pairs

It is recommended that you limit your analysis to a just a few pairs or currency pairs that you feel most comfortable trading. You can simply choose currency pairs you that you understand well. A currency pair is the quotation of two different currencies from different nations.

Some of most popular forex pairs are EUR/USD, USD/JPY and GBP/USD. Your choice of pairs to target echoes your method to forex trading in general and is another integral part of your strategy.

Here are the top 8 major currency pairs:

1.         U.S. Dollar (USD)

2.         European Euro (EUR)

3.         Japanese Yen (JPY)

4.         British Pound (GBP)

5.         Swiss Franc (CHF)

6.         Canadian Dollar (CAD)

7.         Australian/New Zealand Dollar (AUD/NZD)

8.         South African Rand (ZAR)

Strategy 3 – Trading Technical vs. Trading on News

The fundamentals of technical analysis can be quite perplexing and that is why others opt to rely on news feeds. The decision is entirely up to you. If you wish to be a skilled technical analysis trader, one tip is to use two indicators and use multiple time frames for confirmation. However if you would like to trade on news, make sure you get reliable data releases.

Strategy 4 – reading the INDICATORS

The application of indicators to your chart creates the basis to generate signals to buy or sell. Different indicators will lead to a variety of systems that you can apply to your forex trading strategy. Whatever system you apply, the indicators should help you to confidently read the trend. If you think a system generates proven signals and aids in making you read the market then you can make it a part of your trading strategy.