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Making Money Currency Trading

Posted by TFNG Admin On November - 24 - 2013  
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These thoughts about making money currency trading are not only for beginners but also for those experienced in trading currencies. Understanding Forex fundamentals is essential to making money currency trading. Likewise a focused approach to Forex trading is more likely to be profitable than a haphazard one. If you are interested in making money currency trading let us start with the basics of Forex.

Forex Basics

The Forex market is huge with an average daily currency turnover of around $4 Billion. It can be volatile and obviously is very liquid with the huge numbers involved. Trading major currency pairs on a decentralized market that is open around the clock can be very lucrative to those with a successful trading Forex system and the skills and patience required to use it. It can be terrible way to lose money for the uninitiated. Success in making money currency trading starts with learning Forex basics. The Forex market is largely the province of central banks, multinational corporations, multinational banks, and other international players who manage currencies or do business across the globe. It was developed to facilitate international trade but also provides potentially lucrative market for currency speculators. What separates the successful Forex trader from the rest is devotion of time and effort, education, thought given to how and when to trade, patience, and more homework. With computer software it is possible to simulation trade on the current market and it is possible to trade past market conditions as though they were new. Understanding the Forex markets comes with learning the major currency pairs and trading them repeatedly to get the basics of Forex trading down pat.

The most actively traded currencies are those of the most advanced economies. These are wealthy nations who allow their currencies to float in the Forex markets of London, New York, and Tokyo. These currencies trade in high volume and with high liquidity. These facts make the technical analysis of major Forex currencies more accurate and the trading of these currencies potentially more profitable.

Most Commonly Traded Currencies

Most Commonly Traded Pairs

US Dollar (USD)

(USD/JPY)

Japanese Yen (JPY)

(EUR/USD)

Euro (EUR)

(USD/CHF)

British Pound (GBP)

(GBP/USD)

Canadian Dollar (CAD)

Australian Dollar (AUD)

Swiss Franc (CHF)

Making Money Currency Trading

Learning the basics of currency trading is necessary if you are interested in making money currency trading but there is more. To a large degree successful Forex trading is a performance art. You need to know the basics and you need to practice the basics in real time. You can trade in simulation all day long but it is a different world when your trading capital is at risk. A major factor in making a profit in trading foreign currencies is the psychology of trading. The twin demons of trading are greed and fear. Traders are prone to stay in a position too long because they are trying to eke out more profits. Traders are also prone to exit a position too soon because they are fearful and do not trust their fundamental and technical analysis. Good traders develop a strategy and they use the strategy to trade. They analyze their results and make changes in their strategy as needed. Making money currency trading is possible when you learn the basics, avoid the demons of fear and greed, and continually hone your trading strategy in search of more efficient trading and higher profits.

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    Disclaimer - Forex, futures, stock, and options trading is not appropriate for everyone. There is a substantial risk of loss associated with trading these markets. Losses can and will occur. No system or methodology has ever been developed that can guarantee profits or ensure freedom from losses. No representation or implication is being made that using this methodology or system or the information in this site will generate profits or ensure freedom from losses.

    HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN OR MENTIONED.

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