Forex trading online

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The foreign exchange market, also known as the forex market, is the world’s most traded financial market. We’re committed to ensuring our clients have the best education, tools, platforms, and accounts to navigate this market and trade forex.


If you’re not sure where to start when it comes to forex, you’re in the right place.

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You’ll find everything you need to know about forex trading, what it is, how it works and how to start trading.


Summarizing the basics of forex trading

Understanding currency pairs

Different groups of currency pairs


How to trade forex for beginners

The three most popular charts in trading

How to start trading with a forex broker


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What is forex?

Forex is short for foreign exchange – the transaction of changing one currency into another currency. This process can be performed for a variety of reasons including commercial, tourism and to enable international trade.

Forex is traded on the forex market, which is open to buy and sell currencies 24 hours a day, five days a week and is used by banks, businesses, investment firms, hedge funds and retail traders.


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What is the forex market?

The forex market is by far the largest and most liquid financial market in the world, with an estimated average global daily turnover of more than US$6.5 trillion — which has risen from $5 trillion just a few years ago.

One critical feature of the forex market is that there is no central marketplace or exchange in a central location, as all trading is done electronically via computer networks. This is known as an over the counter (OTC) market.


What is FX?

The foreign exchange (also known as forex or FX) market refers to the global marketplace where banks, institutions and investors trade and speculate on national currencies.


Forex trading is the process of speculating on currency prices to potentially make a profit. Currencies are traded in pairs, so by exchanging one currency for another, a trader is speculating on whether one currency will rise or fall in value against the other.

The value of a currency pair is influenced by trade flows, economic, political and geopolitical events which affect the supply and demand of forex. This creates daily volatility that may offer a forex trader new opportunities. Online trading platforms provided by global brokers like FXTM mean you can buy and sell currencies from your phone, laptop, tablet or PC.


What is an online forex broker?


An online forex broker acts as an intermediary, enabling retail traders to access online trading platforms to speculate on currencies and their price movements.

Most online brokers will offer leverage to individual traders, which allows them to control a large forex position with a small deposit. It is important to remember that profits and losses are magnified when trading with leverage.

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FXTM offers a number of different trading accounts, each providing services and features tailored to a clients’ individual trading objectives.

Discover the account that’s right for you by visiting our account page. If you’re new to forex, you can begin exploring the markets by trading on our demo account, risk-free.


Why trade forex?


Forex offers many benefits to retail traders.

You can trade around the clock in different sessions across the globe, as the forex market is not traded through a central exchange like a stock market. This means you can jump on volatility, wherever it happens. High liquidity also enables you to execute your orders quickly and effortlessly.

Trading forex using leverage allows you to open a position by putting up only a portion of the full trade value. You can also go long (buy) or short (sell) depending on whether you think a forex pair’s value will rise or fall.

Forex trading offers constant opportunities across a wide range of FX pairs. FXTM’s comprehensive range of educational resources are a perfect way to get started and improve your trading knowledge.


Understanding Currency Pairs

All transactions made on the forex market involve the simultaneous buying and selling of two currencies.


This ‘currency pair’ is made up of a base currency and a quote currency, whereby you sell one to purchase another. The price for a pair is how much of the quote currency it costs to buy one unit of the base currency. You can make a profit by correctly forecasting the price move of a currency pair.

FXTM offers hundreds of combinations of currency pairs to trade including the majors which are the most popular traded pairs in the forex market. These include the Euro against the US Dollar, the US Dollar against the Japanese Yen and the British Pound against the US Dollar.

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The diagram on the left looks at the most traded currency pair (EUR/USD) in the forex market and breaks down its essential components

For most currency pairs, a pip is the fourth decimal place, the main exception being the Japanese Yen where a pip is the second decimal place.

On the forex market, trades in currencies are often worth millions, so small bid-ask price differences (i.e. several pips) can soon add up to a significant profit. Of course, such large trading volumes mean a small spread can also equate to significant losses.

Trading forex is risky, so always trade carefully and implement risk management tools and techniques.