As a beginner, the first step in forex at cfd trading South Africa is to stop looking at the easy way. Don’t embrace the automated robots that are believed to trade for you as you sleep,. You have to avoid scam artist that offer you with the Holy Grail, run away from account managers who are suspicious promising profits at 100%.
What is forex trading?
The forex trading also referred to as by the name of the FX trading or currency trading is buying a certain currency while selling the other in exchange. The trading currency does involve an exchange of one currency for the other. The ultimate aim can tend to vary and can be any of the following but not limited to it:
- Exchange of currency A to currency B for purpose of traveling
- Exchange of currency A to currency B for purposes of trading
- Exchange of currency A to currency B for purposes of speculating with a goal of making profit
Because of all the aforementioned, and not limited to that, the market for forex trading is one of the world current liquid market, and the most volatile with more than $5 trillion traded daily.
The way forex trading works
Forex trading refers to currency trading for one another. Because of that, an XM client will sell one currency against the other at the present market rate. For that to be traded, it is necessary opening an account and hold currency. And then exchange currency A for B either for short or long term trade, with the main goal varying from one individual to the next.
Because the FX trading is normally performed on the currency pairs, the quotation of the value for one unit of currency against the other unit, where the initial currency is the base currency and the second one referred to as quote currency. An example might be a quote of EUR/USD being 1.4567 which is the price of the euro expressed in the USD, which denotes, 1 euro is equivalent to 1.4567 USD.
The currency trading can be done throughout the day, 24 hours a day from about 2200GMT on Sunday up to 2200GMT on Friday, with the currencies which are traded among the main financial centers of New York, London, Zurich, Tokyo, Paris, Frankfurt, Singapore, Sydney, and Hong Kong
Is forex easy or difficulty?
Trading in forex might seem to be complicated at first, but when you get the hang about it, it can be easy to trade on it. Try learning the basic strategies and the driving force which is behind the movement of currency.
Trading is normally not for everyone, even if you manage to rely on the markets for a living, it is not a job that you can do 9 to 5 and you are not sure the amount that you are going to make in a particular month. It is the uncertainty that most people don’t like. That is why there are traders who try to set goals to make an actual dollar amount every month but that is not how the forex market works. It is possible to break even or to lose.