How to make money online using forex trading knowledge

What is forex

This tutorial contains basic knowledge of forex trading. If you read the full tutorial, I hope, you will learn much more about FOReign EXchange market

The FOReign EXchange market is a global and decentralized financial market for the purchase and sale of currencies. Financial centers around the world operate as intermediaries in transactions between different types of buyers and sellers 24 / 24h except on weekends.

Currency

The main purpose of the FOReign EXchange market is to assist the various operators in their trade and investments, allowing companies to convert one currency into another. For example, it allows an Italian company to import English goods by paying in sterling even though the company has revenues in euros. The trading market also allows you to speculate on the purchase and sale of currencies and facilitates carry-trade.
A typical FOREX transaction a party buys a certain amount of currency by paying with another currency. The modern currency market started to become that around the 1970s, when the various nations switched to the fluctuating currency market system and marked the end of the Bretton Woods fixed exchange rate system.
The currency market  is unique because

• it is a high volume market, which leads to high liquidity;
• it is decentralized;
• operates 24 hours a day;
• multiple factors affect exchange rates;
• the relative profit margins are low compared with the other fixed-rate markets;
• allows the use of financial "leverage" to increase profit margins in relation to invested capital.
• For these reasons, FOReign EXchange market is often considered as the market closest to perfect competition, despite the currency interventions of central banks.

READ: What is forex currency and how does it work

Fx Trading

The term Fx trading refers to the trading activity of different currencies, therefore the purchase of currencies of different nations that will be subsequently resold at a higher price thus making a profit from the purchase and sale transactions.
This kind of activity can generate huge gains but requires experience and knowledge of FOReign EXchange market trading rules.
With new technologies, this trading is basically done online and therefore at a distance, and it is often possible to use FOReign EXchange market simulation test platforms to facilitate learning.
The basic knowledge to operate in trading requires knowing:
Forex market hours
What are the best trading hours
Daily and long-term trading
Analysis of GDP and economic indices of the countries whose currency is to be purchased
Risk minimization
Index analysis
Knowledge of online FOReign EXchange market platforms

But how does FX trading work?

Let's proceed with the following example: suppose the exchange rate between the US dollar and the US dollar is 1.25, so to buy 100 euros you need 125 US dollars and the FOReign EXchange market trader has an expectation of improving the European currency.
It will, therefore, buy one million euros, disbursing one million two hundred and fifty thousand dollars.
If the expectation of the FOReign EXchange market trader comes true and the Euro / US dollar exchange rate goes up to 1.30 he could sell the million euros for one million three hundred thousand dollars, thus obtaining a profit of 50,000 US dollars.
This is only the simplest example of operation in the FOReign EXchange market, it is in fact known to all traders that there are also other methods such as margin trading.In this case assuming a margin of 100: 1 the broker will ask you for a minimum payment on a special account so if we paid US $ 1,000 we could make investments up to the US $ 100,000.In this way, it will, therefore, be possible to negotiate amounts of currency with little real availability on the support account.

What is the forex trading market?

 FOReign EXchange market tutorials for beginners. This tutorial contains only a basic concept about the FOReign EXchange market

 Forex trading tutorials for beginners

Here we can buy or sell foreign currency in a second by a broker house. But many people think this is a worldwide casino. They're wrong. that isn't a casino or gambling house. FOReign EXchange market gives us a great opportunity to make money online. But it is not easy. Everybody can't make money from the market. You can indeed earn a lot of money from FOReign EXchange market. On the contrary, it is also a perpetual fact that the number of loser traders is much higher than the profitable traders. An international survey tells us that only 30% of traders can make money from the Fx market

Forex market time

The element that characterizes the Forex market of other markets, such as the stock market, should not be based on a specific place.
This is an OTC - Over The Counter market where quotes, in constant fluctuation, are determined by the principle of supply and demand.

In the Fx market, the trading week starts on Sunday night with the opening of the Asian session and ends on Friday with the closing of the US session.

These are the times of the main Fx market:

New York opens from 8:00 a.m. at 5:00 p.m. EST

Tokyo opens at 7:00 p.m. at 4:00 a.m. EST

Sydney opens at 5:00 p.m. at 2:00 a.m. EST

London opens at 3:00 a.m. at 12:00 p.m. EST

Tuesdays and Wednesdays are the days with more operations.

Operations should be avoided on Friday nights and Sunday nights, that is, the moments close to the closing and opening of the markets.

Holidays are not recommended

Broker

To make investments in the FOReign EXchange market in most cases, the Fx broker is referred to a professional, this is the trusted person to whom the online FOReign EXchange market investor will entrust his money.

The choice of the broker must be made by collecting, first of all, all possible information on its reputation and that of the company it represents, understanding how much availability is available to you over the entire 24 hours.

The investor should always have a very clear understanding of how to top up and withdraw his FOReign EXchange market account including broker fees.

Spread

The spread is the difference between the demand and supply of a given currency or index.
It is generally set by our financial intermediary. The spread should be lower in the case of currencies with large trading volumes, higher for less important currencies and with lower trading volumes.
The spread is the intermediary payment for the transaction.
When a so-called trade long is made, the purchase value of the currency pair (so-called cross) is that indicated by the bid demand,   while in the hypothesis of a short trade the currency pair is purchased at the value indicated by the offer offered.

So: spread = offer - bid.

The lower the spread, the easier it will be to make money in the fx market.

Pips

The pip percentage in point represents the smallest movement that a currency pair can take.

In this way, it is, therefore, possible to easily calculate the gains or losses precisely because everything is based on the price of the open position and the number of pips earned or lost.

Thus proceeding we could, therefore, have for example the listing in the EUR / USD = 1.4347.

If in this example the price went from 1.4347 to 1.4387 we could say that it increased by 40 pips vice versa if it fell to 1.4335 it would be reduced by 12 pips.


In the first example, that of the increase, if we had had 100,000 in the EUR / USD pair we would have achieved 400 US dollars of gain, in fact, 100000 x 0.0040 = 400.

Read: What is pips in forex trading & how to calculate 

How to make money

First of all, it must be said that with Forex you can make easy profits, but just as easily you can still lose money.

The Fx market has a turnover of 5.2 trillion dollars a day, it is possible to earn in any circumstance whether it is when the market is on the go or when it is falling.

By easy gain, we mean a series of factors that contribute precisely to making this circumstance easier.

In particular, we refer to the possibility of being able to operate remotely by means of the PC of our office or of our house, without therefore going to a specific workplace or to places dedicated to trading.

Certainly, it is necessary to have a certain degree of knowledge and experience to be able to operate successfully in the online fx sector.

Surely the Fx trader has an advantage over his colleagues who work in similar sectors such as the securities market, and that is that the international currencies with which he will operate are a maximum of a dozen, while in the securities market hundreds are known if not even thousands of opportunities presented to the investor.

In any case, in order to start earning money, we must contact a specific intermediary so-called broker that will open up a special account from which we can start trading, and on which the broker will keep the provisions.

It is important to understand that the operations are carried out on currency pairs, for example, the EUR / USD pair indicates that a purchase of euros will be made and a sale of US dollars vice versa for the USD / EURO pair.

The currency pairs are called cross, the first of the currencies is called base currency while the second currency or counter currency.

Buying the base currency and selling the quote or counter currency is called "going long", while making the reverse trade is called "going short".

Now let's see some practical tips to start making money in online Fx trading:

• If the trend is on the upside, never go short, on the contrary, if the trend is down, try not to open in positions that are long.
• Never proceed on impulse or intuition
• Never risk more than 5% of the capital you have available
• In the event of losses, do not try to "fix" it is the best way to lose all your capital

Who makes money from the forex market?

It is a common and more common question. Every new trader and investor asking himself- " Can I make money from the Fx market ?". Because they're always afraid of losing investment or net capital. Don't worry. Now I tell you who can and who can't this.

 Who Can earn?

It is very difficult to tell who can this but I try to some bullet point for an answer this. We already knew that FOReign EXchange market is an online business platform. we also know that money brings money. So,

 Fx trading tutorials for beginners

• first of all, you need enough money for investing in the market.
• You have good knowledge of the market.
• You must abandonment your emotions.
• You must have a good strategy for opening and closing positions.

How to enter the FX market?

Forex trading tutorials for beginners

• First of all, you need a Desktop or laptop computer for trading smoothly.
• You need a verified Gmail or Apple id.
•  Passport or national ID card for proving identity.
• You also need a utility bill or bank statement for proving the address.
• You have a debit or credit card for depositing funds and withdrawing profit.
• You must have a verified account in any broker house.
• Metatrader 4 or Metatrader 5 software.

Instruments for trading:

Currency pairs are the most common and main instruments in this market. Single currency and any other single commodities have no value in this market. Every currency, metal, share, and other commodities make a pair.  Like a couple

Sample of instruments.

Currency Pairs	Metal Pairs	Cryptocurrency Pairs
EURUSD	XAGUSD	LTCUSD
USDJPY	XAGEUR	BTCUSD
AUDJPY	XAUUSD	XRPUSD

Explain:

1.EURUSD   =  EUR / USD

EUR = EURO

USD = AMERICAN DOLLAR

2. USDJPY  =  USD / JPY

USD = AMERICAN DOLLAR

JPY = JAPANESE YEN 

First, two-letter are country code and the third letter is currency code.

Explain:

1. USD 

US = United State

D = Dollar

2. JPY

JP = Japan

Y = Yen.