Commonly pronounced as the Foreign exchange, the Forex Trading is an international market where world’s currencies are traded in a decentralized manner. With average daily trading around 5$ trillion, Forex trading is the broadest, and the most liquefied trading arena in the world.
Let’s Make It Simple-
To understand Foreign Exchange from a layman’s depth, let’s take a case. You are spending a vacation in the Paris, need to pay immigration lawyers in Paris, but suddenly ran out off local cash, so you went to a money exchanger to convert pounds into Euros. The foreign exchange rate determines the value of your pounds against the Euros. And, the value all depends upon the supply and demand cycle. One day you got 1.19 Euros while the very next day, you received 1.25 Euros. At its core, the exchange rate fluctuates.
But, now think from a businessman’s mind, who has to pay for an enormous million dollar deal, now imagine how this fluctuation will affect the company’s annual revenue.
In both the cases-, you being a vacation or a CEO, probably wish to hold your currency for a bit longer until the foreign exchange landscape becomes favourable.
Here We Put Forth a Set of Strategies to Develop into a Master of Forex Trading:
Know Your Market
This is a sheer given strategy to currency trade like a pro. Irrespective of your business structure, you will never be able to establish big gains with a market that closes on weekends. That’s why all the worldwide expert traders’ always in search and think mode, they know when the top markets of Tokyo, New York, London, and Sydney, opens and closes. This knowledge gives them to expertise to pick the right pair of currencies which are active during your hours of trading.
You require to figure out the ins and outs of each market by analysing its particularities, this should be done well before you dip your toes in trading. Also, learn about the fundamentals of each eminent currency, just remember knowing your due diligence, if you are beginner will prevent your become victim of lack of knowledge.
Scrutinise the Trends like a Pro
Analysing the latest trend in the foreign market is not as straightforward it may seem since Forex has a remarkable pattern of changing trends and patterns within a fraction of a second. And, these changes or let’s call them fluctuations. Support and resistance pair is one of the proven Forex trading strategies helping investors in several of the world. Under this, support is the magical tendency of Forex exchange to come out of a low, while the resistance means like the law of gravity when the market goes high it is bound to fall.
However, many amateur marketers make the mistake of predictable trading based on the tendencies of recent price highs and lows. Trends in the Forex trading are dramatic, not prolonged, thus it’s up to you to follow the trends or not.
Positional Holding Trading
It is one of the ideal Forex trading strategies if you want to play it safe. And, you never know at the end of the day you might end up grabbing the momentum of the market to make massive gains; so stay calm and stay positive.
To conclude
These three strategies will help you become a master of Forex exchange investment.