Nowadays it is quite possible to learn forex from the comfort of your home. Although it needs a lot of understanding and knowledge of the market in general, it is a very profitable venture if you are interested in earning a good second income. Once you have gotten the basics at your fingertips, then it is possible for you to start making a good and steady income through this venture. Most people who trade in forex do it from home and are quite satisfied with the results they get.
Learning how to trade is not a difficult task. It just needs time and dedication to be able to learn it enough to apply it for your benefit.
How to Go About It
To start with the very basics, initiate your study by learning about what forex actually is. It is the trade done using a pair of currencies which rise and fall in fall accordance with market trends. You, the trader, exchange the value of one currency for the other in times when there is a possibility of profit for them. For example, you have bought a USD currency and want a EUR/USD exchange. Since the Euro is a higher value currency, you will sell the Dollars in exchange for the Euro only when the value of the Euro increases, otherwise, you are in danger of losing money on the deal. This way, when the rates reverse, you will gain even more profit and in the end will end up with more than the original invested capital.
Entry and Exit Points
It is important to know and observe the market for long enough to have a fair idea about when you should make an entry in the market. If you are using a volatile currency pair which includes EUR/USD, CHF/USD and USD/JPY, then you will have to be extra careful as it is difficult to judge the best entry point since the rates change hourly. In a less volatile currency like the GBP, you can take your time in entering the currency since it will not be changing as quickly and will be easier to trade in. However, this is an expensive currency and it may cause large amounts of losses if not handled well. The exit points of trading are sometimes as difficult to gauge as entry points. People sometimes keep waiting for the rates to change and do not extract their earnings at the right time. By the time they realize that it is a fruitless endeavor, it is too late and their earnings have been irrevocably lost.
For the practice of Forex at home, start with an online demo account and start a trade using that account. This is a good way of making yourself familiar with the trading business and to prepare for the actual trade using real money. Just keep the following points in mind:
- Research thoroughly
- Learn about the odds at stake
- Make a study of currencies on a regular basis
- Do not use a forex robot/automated program in the first few weeks
- Analyze market flux
- Familiarize yourself with financial terminology
On a final note, trading with only the amount of capital which you can afford to forgo is the best way. This is because in case of losses, you need to be prepared to liquidate and sell the commodity in order to pay back the leverage.
And as i tend to do often, heres a quick video about what we were talking in this post, hope you like it, see you soon!