Learn Easy Forex Trading and Lots of Profits (Beginner’s Guide)

Learn Easy Forex Trading and Lots of Profits (Beginner’s Guide)

Are you a beginner in the world of forex trading? If it really means you need a lot of information to support trading. Forex which is an acronym for Foreign Exchange is done by “selling and buying” International currencies. If we usually sell and buy using money, here we trade the currency itself.

Forex Trading

Learn Easy Forex Trading and Lots of Profits

Although both selling and buying, trading international currencies certainly has specifications that make it different from trading in general. Therefore, before entering the forex market and starting trading, you must learn forex trading by knowing what you might encounter in the world of Foreign Exchange. Here are some things you need to know in the forex world as a beginner trader .

Learn to trade Forex – Transactions in Forex trading

If you are a banana trader, the merchandise is banana. If you are a forex trader, then foreign exchange or foreign exchange is your merchandise. Knowing the merchandise alone can not be presented your capital as a new forex trader. In forex trading, currencies are traded in pairs. One of the most traded pairs is a pair between Euro and USD or EUR / USD. When trading this currency pair then in one transaction you also buy and sell. So in EUR / USD, you sell EUR and buy USD. In conclusion, in forex trading you can directly make transactions for all pairs based on an analysis of the market movements you are doing.

Terms in forex transactions

  • Pip

Pip is a unit of value change in forex trading. For example, when you trade EUR / USD that moves from 1.3029 to 1.3030, it means that the price changes with the direction up by 1 Pip. Pip is located in every last decimal number behind the comma. Pip is also usually used in the calculation of profit or loss .

  • Lot

Lot is a form of trading in the forex market. Lot has a standard value of $ 100,000 with a minimum of $ 10,000. Nevertheless sometimes there is a broker that offers flexibility in transaction volume without having to enter Lot units. Brokers only need to enter in a flexible quantity in accordance with the wishes of the trader.

  • Bid

Bid is the price that is applied when a trader sells (pair).

  • Offer

Offer is the price that applies when we buy (pair).

  • Spread

Spread is the difference between bid and offer.

Types of transactions in forex

In general, transactions in forex are buy and sell against existing pairs. In this buy / sell there are two types of orders / orders for each transaction, namely Instant Executions Order in the current real time market and Pending Orders that can be done when touching a certain price point ( booking price).

Pending Orders are divided into 4 types, namely:

  • Buy Stop – installs a buy order at a certain price above the real time price.When the price moves up it will automatically run a buy order and make a profit.
  • Sell ​​Stop – the opposite of Buy Stop is to install sell orders at a certain price below the real time price. When the price moves down it will automatically run sell orders and make profit.
  • Buy Limit – install a buy order at a certain price below the real time price in the hope that the price moves down. If the price is touched then an automatic buy order will run. The target is the price will rise again from that price.
  • Sell ​​Limit – the opposite of Buy Limit.

Learn Forex Trading – Analysis in Forex Trading

So far there are two trading analyzes that many traders use in trading, namely Fundamental Analysis and Technical Analysis. Nevertheless there is actually one more type of analysis, namely Market Sentiment Analysis.

Definition and Differences Forex Analysis

These three analyzes are indeed considered to have a large influence in determining market price movements. For beginners it is very important to know the differences from the three.

  • Technical Analysis

Technical Analysis is used to observe price movements seen in the price chartOne reason this technical analysis is used is because price movements are always repeated. This analysis will guide traders to recognize the pattern of price movements that have occurred in the past as an estimate of prices in the future, so that they can decide what order to take, sell or buy. In order for this analysis to be more perfect, sometimes traders use certain observation methods such as applying technical indicators.

Fundamental Analysis is used to examine price movements from various factors that can affect the rise and fall of the currency. Some of its potential are like policies set by the Central Bank, the release of economic data related to a country’s economic conditions such as inflation. Events such as natural disasters and political turmoil can also be used as material for fundamental factor analysis.

  • Market Sentiment Analysis

This analysis comes from a consensus agreed upon by market participants who estimate the direction of price movements based on various considerations, including fundamental and technical factors. There are three types of market sentiment, namely:

  1. Bullish: the tendency of the majority of market participants to predict price movements that will rise.
  2. Bearish: the tendency of the majority of the market to predict prices to go down.
  3. Neutral: price movements are expected to be stable.

Collecting a non-centralized forex market consensus is definitely impossible.Therefore, market sentiment is usually only interpreted by an in-depth analysis of the current fundamental situation or by looking at price patterns on the chart.Market sentiment analysis has aids in the form of buying and selling ratios from certain brokers called CFTC (Commitment of Traders). Nevertheless this tool is also not very helpful in describing the consensus of all actors in the forex market.

Determine the best analysis

It is known that traders are provided with 3 types of analysis that can be used to predict market movements. Then, which of the three analyzes is the best analysis that should be used?

The answer is there is no best analysis if only using one of them. For example, if you think that technical analysis is the best analysis and only use it without regard to two other analyzes, then your analysis might be wrong.

The best choice is to at least use at least two of the three fundamental analyzes.Maybe it’s difficult, but at least it will reduce the risk of greater loss.