Trade Forex

If you’re still new to the world of forex, there’s only one thing that we really need to tell you: get out there and excite your first trade already? Oh, what’s that? You’re not sure how to go about executing your first trade? No problem.

A lot of would-be traders get cold feet even before they excite that first trade, but that doesn’t mean that you have to be the same way. The truth of the matter is that you will want to always make sure that you know how to pull off your forex trades. As time passes, it goes without saying that you will eventually become quite good at it.

At this point, you might wonder whether or not you should open up a practice account to do your first forex trade, or if you should jump right into real trading. There are some pros and cons to both methods. The greatest pro of a practice account is that you aren’t risking real money, which means that if you make mistakes, you aren’t going to really feel them. However, this leads to the biggest “con” of what is essentially “paper trading” — mistakes don’t affect you, so you’re less likely to take them seriously than if your mistake were to actually cost you real money.

Still, it’s our opinion that you should definitely start with a practice account. For your sake, you will want to make sure that you’re taking it as serious as you can.

So, what do you do first? Well, aside from opening that practice account, you will want to figure out what currencies you actually want to trade. Take your time and create a “watch list” of currencies that interest you.

Now, from here you can either be an intra-day trader or an inter-day trader. The two terms are pretty important. Intra-day trades are all about trades that are opened as well as closed within the same trading day. Since forex is a 24 hour market, you’re not going to have to really think about the closing bell thing, the way you might with stocks. As you’ll see in the days and weeks ahead as a forex trader, this can be a blessing and a curse at the same time.

Inter-day trades, as you might imagine, are trades that are held open overnight and still remain in effect the next day.

Now, you might wonder why you would ever want to be an inter-day trader, when all the fast action is in intra-day trading. The truth is that you might want to hedge future currency exposures or even to just trade long-term. This is similar to the “buy and hold” theory in stock trading.

Don’t forget that technical analysis still reigns supreme here — charting is going to give you what the market is really doing, rather than just following hot forex tips. There is a time and a place for people to weigh in on what they think a currency pair will do, but you don’t want to put your savings at risk like that. Numbers are the key here — everything else comes second to that.

To actually set up your first forex trade, you need to understand the numbers involved. For example, there is the market order, which is the order that you want to place when you want the order to be executed immediately. It will be at market price.

There is also the limit order, which is a buy or sell order that happens only when certain conditions exist. This is a great way to keep from just gushing money, without having to constantly be at the computer handling trades.

There are some other types of orders, but they’re a bit more advanced. While you’re trying to learn the game, you will need to concentrate on mastering these two orders. Everything else will come along in good time.

Overall, executing your first forex trade isn’t difficult. If you follow the points in this guide, there’s really no way that you can fail — get started today!