Currency Trading For Dummies, 3rd Edition Book

trading plan

Free demo systems were designed by forex brokers for this very purpose, but the real market will beckon soon enough. The next few pages will arm you with key tools and a strategy for winning from Day One. What you decide to do after this lesson is up to you, but at least you will have a greater chance of stepping over the 70% of fatalities that refuse to face facts.

Most of the forex brokers use retail standards which is 100,000 base currency in one standard lot. Following this definition, if you want to buy 1 lot EURUSD you will trade 100,000 EUR. It’s simple to open a trading account, which means you’ll have your own Account Manager and access to hundreds of markets and resources. It is important to understand the risks involved and to manage this effectively.

trading the currency

In very basic terms; Forex is an abbreviation for Foreign Exchange, and you trade (i.e. exchange) one currency pair for another. The author of The Intelligent Investor was Warren Buffett’s teacher himself. It talks about the impact of macroeconomic processes on financial assets. In fact, this is a guide to how economic indicators and fundamental analysis tools in general, such as inflation and monetary policy, affect the state of the market.

Trading forex step-by-step guide

Now I can confidently say that its latest version has inherited all the best features. We will determine the point of a possible trend change based on the Triangle pattern that is currently being formed. According to this pattern, the price will go in the direction of the border that will be broken. I decide that the upper limit will be broken and I am going to buy this currency pair. After some time, we can see that our trade was successful and the price really started to decline. To do this, you must click the “‎Close”‎ button in the trade information field.

supply and demand

Forex markets exist as spot and derivatives markets, offering forwards, futures, options, and currency swaps. He is the most followed trader in Singapore with more than 100,000 traders reading his blog every month… Dummies has always stood for taking on complex concepts and making them easy to understand. Dummies helps everyone be more knowledgeable and confident in applying what they know. Keep in mind that tight spreads are only as good as the execution that goes along with them. Paul Mladjenovic is a renowned certified financial planner and investing consultant.

Who regulates the forex market?

To avoid these problems, you should carefully select online brokers. The ideal option for any beginner would be to open an account for up to 1,000 USD and practice. Trading Forex provides such an opportunity, because you can start trading even with 50 USD. It’s entirely up to you what to choose, but it is obvious that Forex trading is much more suitable for a beginner due to the low threshold of funds required to start trading. There are a lot of differences in trading Forex and stocks on the stock exchange.


Here, each and every second does have the potential to matter quite a lot. Additionally, the different things and events, as they happen, can have a huge impact on the market. Sometimes, even seemingly-insignificant things can have a very dramatic effect.

Although commercial and financial transactions in the currency markets represent huge nominal sums, they still pale in comparison to amounts based on speculation. By far the vast majority of currency trading volume is based on speculation — traders buying and selling for short-term gains based on minute-to-minute, hour-to-hour, and day-to-day price fluctuations. Forex trading is conducted through a network of brokers, banks and financial institutions. These entities facilitate the buying and selling of currencies in the foreign exchange market. The vast majority of currency transactions are conducted on so-called OTC (over-the-counter) markets. The forex market is open continuously, seven days a week in different parts of the world.

This book will break all your delusions and myths regarding the market and teaches you how to deal with brokers and money managers skillfully. If you are someone who wants to make an independent investment plan and stick to it, this book is your go-to guide. This book has been written by one of the most respected independent investment advisors globally, who believes that there are no shortcuts or magical tricks to succeed in the forex market. The book teaches you the core values one must have to become a successful trader. It highlights the importance of hard work, patience, self-discipline, and overcoming emotional restraints to freely take investment decisions..

Trading in the European/London session

A lot is the number of units of a financial instrument that is traded on an exchange. For stocks, a round lot is 100 share units, while forex is traded in micro, mini and standard lots. A carefully crafted strategy and trading plan will address most of these factors and help you manage the risk of your trade.


Like 10 or 20 years ago, today Forex trading remains one of the fastest and most significant means of online earning. And if for some reason you are not yet a Forex trader, you should read this article and find out what currency market trading is. In this fascinating, informative book, Jim will introduce beginners to the world of forex trading, with step-by-step explanations suitable for beginners.

Currency pair trading is the buying or selling of one currency for another. For example, when buying and selling the EURUSD currency pair, we buy and sell a certain amount of euros by paying for them in dollars at the exchange rate. As with any type of trading, it implies a high risk of losing trades and can make your investor accounts lose money. As managing director of BK Asset Management and a renowned currency analyst, Kathy Lien frequently appears on Reuter’s, Bloomberg, and CNBC programs. It blends theory and practical knowledge with a balanced understanding of the fundamental and technical forex trading tactics.

Factor incoming data and news into the major fundamental themes of interest-rate expectations, economic-growth prospects, inflation, and structural developments. RoboForex— one of the most popular and innovative brokers with MetaTrader platform and comfortable trading conditions for all kind of traders. You need to be aware, unfortunately, that nearly 70% of beginners become impatient early on and leap into the market before completing anything close to preparation. Forex is traded by what’s known as a lot, or a standardized unit of currency. The typical lot size is 100,000 units of currency, though there are micro and mini lots available for trading, too. Forex slippage occurs when a market order is executed or a stop-loss closes the position at a different rate than set in the order.

risk management

The major forex market centers are Frankfurt, Hong Kong, London, New York, Paris, Singapore, Sydney, Tokyo, and Zurich. Whether you’re an individual trader or a financial or investment professional, the foreign exchange market, also known as the currency or foreign currency market, is where the money is. We recommend using a demo account if you’re about to explore how to start forex trading. Using a demo account can be the best way to learn forex trading.

I enjoyed this and learnt a lot it was pretty much what I was looking for. There are a few topics that seem to be covered repetitively but I was ok with that. Easy to understand, even if some info is outdated provides lots of learning links too.

The Yen repatriation trade appears to be back in play –

The Yen repatriation trade appears to be back in play.

Posted: Tue, 28 Mar 2023 03:01:27 GMT [source]

Now you need to choose an intermediary who will give you access to the world currency exchange. If you want to know how to choose a Forex trading provider, you can read more about this in my colleague’s article. The first step is to decide on the exchange on which you will trade Forex. If you intend to trade currencies, then it’s currency exchange, or Forex markets. Swing trading can be a fun and very lucrative way to make a living off the stock market.

How to Trade Forex News – Yahoo Finance

How to Trade Forex News.

Posted: Mon, 13 Mar 2023 07:00:00 GMT [source]

Forex transactions are quoted in pairs because you are buying one currency while selling another. The first currency is the base currency and the second currency is the quote currency. Foreign exchange, popularly known as ‘Forex’ or ‘FX’, is the trade of a single currency for another at a decided trade price on the over-the-counter marketplace. Forex is definitely the world’s most traded market, having an average turnover of more than US$4 trillion each day. This book features the in and outs of currency trading as well as strategies needed to achieve success in the trading.

The process of trading forex for dummies manipulation by banks and other financial institutions is also wonderfully revealed. Modern Forex trading remains basically unchanged, the only difference is that the first Forex traders made foreign exchange transactions with their own funds. Now we have access to a margin lending system that allows us to trade Forex with the funds borrowed from Forex brokers. Ninety-nine percent of traders out there are either breaking even or their account is wiped out completely after a few trades. It’s an outrage how much nonsense is out there about Forex like fundamental analysis or trading the news–let me tell you, it’s all BS…. Uncover what forex trading is, how to get started in forex trading, and how to make a trading plan.

The value of the currency is a rate and is determined by its comparison to another currency. There are also various trading styles that depend on the time frame and holding period of every trade. This includes intraday trading, position trading, swing trading, trend trading, technical trading, and fundamental trading. The forex market’s extreme liquidity and the availability of high leverage urged the market’s rapid growth and have turned it into the ideal place for a lot of traders. You can also choose to open and close your position within minutes or you can keep it open for months. Minor currency pairs include the currencies in the list above, but not the USD.

Before investing money in the market, one can test their knowledge by starting a practice trading account with an international online brokerage. The first tier of liquidity providers in the foreign exchange market is made up of the largest banks in the world with forex departments. These large banking corporations are responsible for making price quotes for all currency pairs, as well as making markets for forex brokers and retail clients who use the ECN platforms. When talking about carry trading, we believe it’s important to discuss FX swap for dummies.