Let’s dig deeper into FOREX.
WHAT IS FOREX?
The Forex Market is one of the world’s largest financial markets and the most exciting, fast-paced for traders.
You can trade currency pairs from every corner of the world.
Open 24/5 and is the biggest global market means it is extremely liquid; you can instantly buy and sell, so you’re never stuck in a trade.
However, there are a handful of pairs that are worth mentioning: more traded than any other currency pairs, the ‘majors’ dominate the FX market.
Daily currency fluctuations are usually fairly small, political disasters aside, moving around 1% or 100 pips.
You can trade forex CFDs with DCFX.
MAKE MONEY BY TRADING FOREX
How much time are you willing to dedicate to learning, research, and trade? Trading forex is not an easy way to make money.
Like most investments, you’ll need to have a clear understanding regarding how to trade, what you’ll need to trade and where to do so.
We will guide you in the dynamic forex trading environment, you can always improve and learn more.
Expand your knowledge, dedicate some time, proper education will be the most effective path to ensure that you’re aware of all the risks and benefits of trading forex.
WHAT IS A FOREX BROKER? HOW DID THEY WORK?
Every day there are trillions of dollars traded on the Forex Market, making it the largest financial market in terms of sheer volume traded. With technological advancement, smaller investors like individual traders can now access the market and become retail traders, made possible by Forex Brokers.
Forex trade is effectively selling one currency while simultaneously buying another. What a forex broker does is basically connect a trader with a buyer for the currency and vice-versa. Without a forex broker, you cannot get access to the interbank market due to a really big capital requirement.
Your forex broker actually has this capital requirement and so can place the trade on your behalf.
Thanks to leverage, where you control more funds than you have actually invested, you can make bigger trades. It’s the forex broker that offers you this leverage so, they use their own capital to open the trade, meaning you can participate in the forex market!
HOW TO LEARN FOREX TRADING?
There are many ways to learn forex trading. Most people who start on the journey usually use one of these:
WHY TRADE FOREX WITH DCFX?
- Trusted and Licensed
- Innovative Technology: WebTrader, Mobile, Desktop, MetaTrader4
- DCFX provides 70+ instruments to trade
- Many prizes with point rewards and referral systems
- Leverage up to 100:1
- Competitive Spreads
- Fund Safety through Segregated Account
HOW MUCH MONEY IS NEEDED TO START?
To join DCFX, you only need US$200 and you can start your trading. To start trading forex, you’ll need to make sure there is enough capital in your trading account. This means that your required capital can be based on your goals and trading style, but it is often suggested that traders shouldn’t risk more than 1% of their account on each trade.
For example, if your account contains $1,000, then you may decide not to risk more than $10 on a single trade.
MARKET OPENING TIMES
There are 4 separate trading sessions in the forex market: Sydney, Tokyo, London, and New York.
These individual sessions mean that the forex market opens on a Monday morning and closes on Friday night!
You’ve probably identified that there are overlaps between the sessions, for example; at 7 am (GMT) both the Tokyo and London sessions are open.
This is what ensures that the forex market provides traders with 24-hour access to trade for 5 days a week (the markets close over the weekend).
CHOOSE REGULATED BROKER
- Without a Broker, you’d never be able to get access to the interbank market as you need a really big capital required to do so. Your Forex broker actually can place the trade on your behalf.
- A regulated broker however is not able to offer such high leverage to their clients and will offer you leverage that’s far more realistic in terms of appropriate risk to reward ratio.
- Moreover, a regulated broker should be offering clients Negative Balance Protection. This means that should the market move against you (or gaps), then you’re protected from generating a negative balance.
- Finally, regulated brokers also protect their clients by always having ‘segregated client accounts. These special accounts hold Client funds separately from those of the broker, ensuring that your broker can’t use your funds for other purposes.
LEARN HOW THE MARKET WORKS
You must know how the forex market operates, which is very different from exchange-based systems such as shares or futures. Forex is bought and sold via a network of banks.
This is called an over-the-counter (OTC) market.
It works because those banks act as market makers – offering a bid price to buy a particular currency pair, and a quoted price to sell a forex pair.
Most retail will use a forex trading provider. Forex trading providers deal with the banks on your behalf, finding the best available prices and adding on their own market spread.
In the Forex Market, you will be speculating on the price movements of currency pairs, without actually taking ownership of the currencies themselves. If you think a currency pair price is headed down, you can go short instead of long.
OPEN ACCOUNT AND PLAN
If you want to trade forex, you’ll need an account with a leveraged trading provider. You can open a DCFX account in minutes, and there’s no obligation to add funds until you want to place a trade.
Building a trading plan is particularly important if you’re new to the markets.
A trading plan helps take the emotion out of your decision-making, as well as provides some structure for when you open and close your positions. Use your favored technical analysis tools on the markets you want to trade and decide what your first trade should be.
BUILD A TRADING PLAN
There are three main parts you should consider:
- Time Frame
Choosing a time frame according to your style is really important. Being a scalper will choose between 1 and 15 minutes. Being a Day Trader will choose a 4-hour chart. So, to make this decision, you’ll need to ask yourself: “how long do I want to keep my trades open?“
- Trading Opportunity Frequency
The next question is “how many times do I want to be opening and closing trades?”
If you’re looking to be opening a larger number of trades, then you would likely be more suited to scalping where you’ll be opening a higher frequency of small trades or Spending less time analyzing the charts by using a trading strategy with longer time frames and larger positions would be more suited to you.
- Day Trading
Forex day trading is strictly conducted within the same trading day. This means that all the positions you open will be closed before the market does at the end of that day. The timeframes that traders tend to use will range from really short-term (within minutes) or over the course of a few hours.
- Hedging Forex Strategy
This strategy is usually used in conjunction with other assets. So, basically, a trader would use forex to hedge against other positions in other asset classes or for other forex positions.
Commonly used to explain the process of getting small profits from a high frequency of small trades, scalping is a strategy conducted over very short time frames, generally on time frames between 1 and 3 minutes.
OPENING YOUR FIRST POSITION
Once you have chosen your platform, you can start trading.
Just open the deal ticket for your chosen market, and you’ll see both a buy and a selling price listed.
Decide the size of your position and add any stops or limits that will close your trade once it hits a certain level. You can monitor the profit/loss of your position in the ‘open positions’ section of the dealing platform.
Once you’ve decided it’s time to close your position, just make the opposite trade to when you opened it.
TRADE WHEREVER YOU ARE
Our trading platforms can provide you with a smart and faster way to trade forex. You can choose to trade via the DCFX trading platform in:
Each of our forex trading platforms can be personalized to suit your trading style and preferences, with personalized alerts, interactive charts, and risk management tools.