What is forex trading

Forex or FX is simply the largest financial market in the world. It has an enormous $4 Trillion Dollar a day in trading volume.

Forex trading is basically buying one currency and selling the other at the same time. So for example if you are buying the GBP/USD pair it means that you are buying GBP and selling USD in the same trade. In Forex you always buy and sell in pairs. The most famous pairs are GBP/USD, EUR/USD, USD/JPY & USD/CHF.

EUR = Euro

USD = US Dollar

JPY = Japanese Yen

GBP = Great British Pound

CHF = Swiss Franc

The EUR/USD is the most traded currency pair by far.

Traders can trade Forex in so many different ways. It depends on your budget and goals. Here are few examples of some famous trading styles

    Scalping: A trader here trades over 10 trades a day taking tiny profits with some big risks. It's hard to master but requires less money.
    Swing Trading: Here the trader trades few times a day or few times a month, the trader usually wait for big smooth moves and there is bigger goals and risks. It requires bigger capital than scalping.
    Position Trading: Like banks and big investors, a trade could take months some times over a year. It requires a huge capital and patience.

There is no best Forex trading strategy. Everyone is different, everyone has his own goals, capital, risk tolerance and most importantly your experience in Forex trading.

The psychological part is different from trader to another, some tend to have a bit aggressive trading approach, others tend to keep it safe and trade conservatively. Some are long term traders some others prefer scalping.

Usually new traders should never invest more than they can afford to lose, once you gain confidence you can start adding to your capital also you can increase the level of risk at that stage.

Forex is a great way to make money if you know what you are doing. It's a 24 hour market, open 5 days a week, you get huge leverage and you can learn everything about it online for Free. Forget about all the HYPED products, ebooks and Robots.

Just take your time to learn about it, use a demo account for a while then you can start trading. Also you can easily find and follow other professionals without having to pay anything or spending months learning about it.