The forex market (also known as the foreign exchange market, forex, FX, and currency market) is the worldwide market for the trading of currencies. It has been estimated that $1.5 trillion worth of foreign exchange takes place every day, making it the largest market in the world.
The currency of a country is the unit in which money values are expressed. Currency trading involves the buying and selling of currencies for profit or to hedge against adverse movements, such as a drop in value due to inflation. Forex (foreign-exchange) markets are those that deal only in foreign exchange; these may be thought of as the casino of the financial world.
If you want to be a successful trader, then take note of a few simple, yet important tips:
· Patience is key – You should stay calm and composed even if things are not going according to plan. It will take some time until you get used to your trading pattern.
· Stay Organized – Make a schedule for yourself and make sure that you stick to it. By setting goals, this will also help keep your confidence up.
· Leave Your Emotions Behind – Thou shall not trade on emotions! As a trader, your goal is to stay as cool as possible and never let your hopes or fears get in the way of your trading.
· Have a Trading Plan – Before entering the market, you should have set rules for entry and exit points. Make sure that you stick to these rules at all times. You should never bend your trading rules no matter how much money you are making.
· Stay Focused – Be in the present and don’t let your mind wander. You have to focus on the market at all times and not get distracted by other things that may come up during a trade.
· Accept Losses – You should realize from the very start that losses are part of trading. There are ways to keep them to a minimum, though. The best way is to risk only 1% of your trading capital on each trade and have the proper stop-loss in place.
· Don’t let Emotions take over – You should never deviate from your plan; rather than risking everything you make, you should aim for consistent growth.
· Don’t trade too much – You should never open more than three trades at a time. It is very risky to be trading with many positions at the same time. If you want to do it, then keep your risks down by not risking more than 1% of your capital on each trade.