For example, in Australia the currency in circulation is Called the Australian Dollar (AUD) and in the United States the currency in circulation is Called the U.S. Dollar (USD). An example of a forex trade is to buy the Australian dollar while simultaneously selling U.S. Dollar. Called This is going long on the AUD / USD.
There are many benefits and advantages of forex trading. Here are some reasons why so many people are choosing this market:
>> With at least one dollar of capital you are able to engage in the world of forex trading.
>> No clearing fees, no exchange fees, no government fees, no brokerage fees. compensation for their services through something called "bid-ask spread". such as brokers instaforex, without brokerage commissions due to benefit from the difference in selling price and buying price.
>> In the spot forex, you specify the number of lots by your own. This allows traders to participate with a small account is only $ 1 in instaforex forex broker and some other broker.
>> The retail transaction cost (ask / ask spread) is typically less than 0.1% under normal market conditions. At larger dealers, the spread could be as low as 0.07%. Of course this depends on your leverage .
>> The market is open 24 hours, do not wait for the opening bell. From the opening Monday morning in Australia for the closing evening in New York, the forex market never sleeps. This is awesome for those who want to trade on a part-time, because you can choose when you want to trade: morning, noon, night, at breakfast, or in your sleep.
>> No one can control the market. The foreign exchange market is huge and has so many participants that no single entity (even a central bank or the mighty superhero) can not control the market price for a specified period.
>> Because the forex market is huge, it is also highly liquid. This means that under normal market conditions, with a quick click of the mouse you can buy and sell because there will always be someone in the market is willing to take the other side of your business. You never "stuck" in the trade. You can even set your online trading platform to automatically close your position if desired profit level (take profit order) has been reached, and / or close a trade if a trade is going against you (stop loss order).
>> Instaforex and the other broker offer "demo" accounts to practice trading and build up your skills, along with real-time forex news and charting services. This is a very valuable resource for those who are "financially constrained," but savvy traders will hone their trading skills with 'virtual money "before opening a live trading account and risking real money.
The following are common mistakes of the Forex Trader:
1. Too early entry into the world of forex trading. Many traders, with large capital, trying to direct entry into the world of forex trading, without the knowledge and experience.
2. Failure to have a trading plan before making a transaction. A trader who does not have any special plans at the time of the OP, do not know when or where it will come out of a transaction, or how much money to be gained or lost. it is a recipe for "crash and burn."
3. Traders did not make proper money management or money management. Does not need much to succeed in the forex world. Part of the success of the trader comes down to proper money management.
4. Expectations are too high and too fast. Many expect to stop working and start trading forex with the hope to get rich quick. You do not become a successful doctor or lawyer or business owner's success in the first few years of practice. It takes hard work and perseverance to achieve success with forex trading is no different.
5. Not using a safety. Using a stop loss or take profit gives a good idea about how much money he bet on a particular trade for profit.
6. The lack of "patience" and "discipline." Many traders fail because of lack patience to wait for the right time to enter the market and in a hurry to close the transaction if the profit and not the discipline to cut losses (close the transaction adverse)
7. Trading against the trend or trying to take the top and bottom in the market. It's human nature to want to buy low and sell high or sell high and buy low. Unfortunately, it has absolutely no means proven to generate profits in forex trading. Top and bottom usually takes the trading against the trend and is a big mistake.
8. Allowing Loss / loss for too long. Traders who hold losses and "hope" that the market will soon turn in their favor, usually fail.
9. "Over-trading." / Too many transactions. If there is a lot of losses, usually make a deal again with the aim of reducing losses. Having "too much iron in the fire" at a time is a big mistake.
10. Failure to accept full responsibility for your own actions. If you lose the streak, do not blame your broker or other person. You are the person responsible for your own success or failure in trading.
11. Do not see the big picture market. It is wise if you occasionally see a larger Time Frame of the time frame you use before making a transaction
12. Not reflective of fundamental news. When you transact in the currency, it helps you also look at the fundamental news is happening on the currency pair you are tradingkan.
I suggest before entering the world of forex trading at first you must learn, patiently. As the saying goes, we can do something because we practise it.
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