The foreign exchange market (forex, FX, or currency market) is a global, worldwide decentralized financial market for trading currencies. Financial centers around the world function as anchors of trading between a wide range of different types of buyers and sellers around the clock, with the exception of weekends. The foreign exchange market determines the relative values of different currencies.
The primary purpose of the foreign exchange is to assist international trade and investment, by allowing businesses to convert one currency into another currency.
If you would like to invest in the currency market but don’t know how there are some key things you must do to get going.
Find the approach you like. There are basically three ways you can invest in forex markets.
1-Managed Forex Accounts
What Does Managed Forex Accounts Mean?
A type of forex account in which a money manager trades the account on a client’s behalf for a fee. Managed forex accounts are similar to hiring an investment advisor to manage a traditional investment account of equities and bonds. Returns and fees between managed accounts can vary greatly; therefore, it is important to research your options thoroughly before assigning your account to a professional manager.
2- Use Forex Trading Signals
A Forex signal is a suggestion for entering a trade on a currency pair, usually at a specific price and time. The signal is generated either by a human analyst or an automated Forex robot supplied to a subscriber of the forex signal service. Due to the timely nature of signals, they are usually communicated via email, website, SMS, RSS, tweet or another relatively immediate method.
Types of services
Services provided fall into four categories:
1. Unpaid/free signals
2. Paid signals from one provider whether by personal analysis or algorithmic analysis
3. Paid signals aggregated from multiple signal sources or ‘systems’
4. Signals supplied by trading software located on the trader’s computer, also known as a forex robot or EA (expert advisor).
Typical features offered by Forex signal service providers
Not all forex signal suppliers will offer all of these services
• Exact or approximate entry, exit and stop loss figures for trades on one or more currency pairs
• Supporting graphs and/or analysis for the signals.
• A trading history showing the number of pips profit/loss per month and/or, the risk/reward ratio and actual trades. Sometimes (especially in the case of forex robots) this may be shown as back-tested results
• One-on-one coaching, or additional interaction with the signal provider such as comments, forum, etc..
• Account management whereby a subscriber’s account can be traded by the signal provider
• Educational resources: internet or phone
• A trial period for a lesser price.
The majority of signal providers focus on supplying signals based on technical analysis and a minority work on fundamental analysis or price action.
Technical analysis, such as Ichimoku and candlestick charting show both short and long-term price trends giving the signal provider flexibility in supplying a range of trade options. Fundamental analysis gives longer-term trade ideas. Price action gives extremely short-term trade ideas, which is often more suited to scalping.
3- Learn to invest in the markets yourself.
If you really want to learn how to properly invest in forex and make money, you should make an effort to learn everything necessary to trade Forex successfully.
You only need 1 single strategy to win money.
Read websites like http://www.forexonlinelearning.com/ and http://www.babypips.com/school/ to educate yourself about forex and use free Demo Accounts to practice.
By: D. Dababneh
As forex is popularly touted as a get-rich-quick method there are a number of services that supply signals of debatable quality, which do not answer the users’ expectations for profits.
Like any other investment vehicle, currency trading can be risky. You should never trade more than you can afford to lose.