Forex market is the place where people, like you and I, hedge funds, and banking institutions can trade the markets with the objective to profit.
What is needed though to be able to be profitable and acquire consistency is a strategy and the right application of risk and money management.
The introduction of the so-called ”forex brokerage” firms enables the traders to speculate the markets anywhere and anytime, 24/5.
Deposit and trade forex
In order though to be able to trade, you must deposit the desired amount of funds into your trading account.
Furthermore, the general idea of forex, is predicting where a currency pair will move next, will it rise or drop?
For example, in the case of the EUR/USD, the euro is the first currency of the pair, the base, and the U.S. dollar is the second currency, the counter.
When a trader aims to speculate or rather ”predict” where the EUR/USD pair will move next, he or she either places a buy or a sell order.
Trading a forex pair
In the condition where the trader perceives that the EUR/USD will rise, he or she, therefore, buys euros and sells U.S. dollars by default. The forex trader, in this case, expects to see the price on the chart rising, thus the euro appreciating versus the U.S. dollar.
On the other hand, if a trader believes that the EUR/USD will drop he or she sells euros, and buys U.S. dollars by default. The forex trader, in this case, awaits to see the price on the chart falling, thus, the euro losing value versus the U.S. dollar.
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