So, where do we begin?

Well, you have to understand that when you’re trying to invest in the forex market, what you’re really doing is trading money. Hard currency, though not “hard” in the physical sense. You’re essentially buying currency like you would buy a share in a particular country. The market translates price into a direct reflection of thoughts about the health of an economy. So when you purchase say, the Canadian Dollar, you’re buying a share in that country’s economy. You’re saying that the economy of Canada is going to be fine, and will grow as time passes.

The exchange rate of a currency versus other currencies is the market’s reflection of the condition of both country’s economies. In terms of USD/CAD, it would be how strongly you feel that the US economy is compared to Canada’s economy. That’s essentially why exchange rates fluctuate so much.

Does that make any of those old financial news broadcasts any clearer in your head’ because when we first started traded forex and really saw what the market was capable of, it started to all make sense.

There are major currencies and minor currencies. IF you really want to take it slow as a newbie, it’s a good idea to stick wit the major currencies. They have enough volume to keep you busy, so you won’t mess up things too much.

Major currencies include the USD (United States Dollar, often nicknamed the “Buck”), the EUR (Euro, the currency of all Euro zone countries and nicknamed “Fiber”), the JPY (Japanese Yen, just “Yen”), the GBP (Great Britain Pound, “Cable”), CHF (Swiss Francs, “Swissy”), CAD (Canadian Dollar, “Loonie”), AUD (Australian Dollar, “Aussie”), and the NZD (New Zealand Dollar, “Kiwi”).

Currencies are traded in pairs, so you will see them reflected that way — EUR/USD, USD/JPY, USD/CHF, and so on.

Currency pairs that don’t contain USD are considered the cross currency pairs, or “minor pairs”. Popular minors include EUR/CHF, EUR/GBP, EUR/CAD, and NZD/CHF.

The market for forex is huge — the forex OTC (over the counter) market is running 24 hours a day. It’s spread all over the globe with no central location. That’s a pretty big deal.

We’ll leave it here — you have quite a bit of forex knowledge to digest! Good luck!

Stocks also provide a lot of variety. If you want to feel like you’re part of a certain company, you can always invest in the stock of that company. Then you feel like you’ve really got a say in how things really are. In fact, a lot of companies will let you vote in shareholder meetings if you own a certain amount of stock. Isn’t that just too cool for school?

Of course it is. There are nearly 4500 stocks listed on the NYSE, and another 3500 on the NASDAQ. You can do your research and build an amazing stock portfolio.

But if you’re like many investors, you might be growing tired of getting into the stock market game. There are plenty of movies about people that made it big in the stock market. These are pretty important people, and it goes without saying that you might want to be just like them. Yet times are definitely changing, and if you’re thinking about growing past that, then you might want to think about forex. This is actually a good decision, for a few reasons.

First and foremost, spot currency trading is all about the currency pairs. The major investors in forex only focus on four top pairs, and that’s a lot better than trying to figure out nearly 10,000 stocks all of the time. Are you going to be looking at all 10,000? Not at all. However, you will want to still look at the market movements as a whole in order to fine tune your portfolio. If you’re tired of that, you might want to start looking at forex trading in a different way.

As you might realize, you can’t trade stocks all the time. That means that you’re going to have to step out of stocks when the market is closed. Instead of not trading at all, you can build a better trading schedule with forex. This new market is actually a seamless 24 hour one, with trading going all the time. You can hit the U.S, Asian, and European markets with ease. It’s simply up to you to define how you want to trade. Gone are the days where you feel you have to be married to a certain time schedule in order to get things going properly.

The commissions are so much less with forex when compared to stocks. Of course you might wonder how brokers actually make their money. They handle things through the bid/ask spread, which is always transparent. There aren’t any hidden forex fees to be had, which is refreshing.

As much as it’s not mentioned, forex is actually open to everyone. This used to be a market that was limited to huge corporations only, but that’s no longer the case. Anyone can trade in forex, so why not check it out for yourself?

But what if you’re ready to branch out in investing further? After getting deep in forex, it might feel like there’s really nothing else worth chasing. Futures is okay, but trading contracts can get boring after a while and the premiums to trade are quite high. Who wants to find that they really could make a good profit in the futures game but the commission is just too high? That’s what we were thinking. And after forex going back to bonds just feels like talking to your grandmother — nice in small doses, but you don’t want to get too dependent — then she’ll start nagging you!

We kid, we kid.

Moving right along, why not think about learning how to buy gold coins online. Believe it or not, it’s not just like going into a store and buying a vase. If you really want to win big in the gold market, you’re going to have to think about your timing. Sentiment analysis is still going to need to be the order of the day. You’re still going to be covered in charts.

In other words, things don’t really change all that much. You still have to plan well, and make sure that you have enough capital in play. Gold is something that you will probably need to take in stages.

Thankfully, you can buy gold online in different weights. You will need to keep in mind that everything about gold is based on the troy ounce. Yes, you might want to go ahead and get an ounce of gold outright, but that’s not always the best road to take.

You really might want to start small — there’s nothing wrong with going with 1/10 troy ounce coins until you can get more capital involved. Some people start out the gate with the big gold bars, but that takes a while to achieve. You’ll just have to make sure that you’re buying smart from start to finish!

So, where does sentiment analysis fit into things? That’s a great question! First, let’s define sentiment analysis as it relates to forex trading.

Sentiment analysis means looking at how traders generally feel about the market. You can look at what people think about the market by charting — what positions are being taken in the marketplace. If everyone is feeling bearish on the dollar, your feelings aren’t really going to overturn it. But what you have to do is look at how to profit from the current market condition as it stands.

Using sentiment analysis to your advantage is something that’s not always easy. Whenever you’re dealing with emotions rather than hard facts, you’re going to have to be careful not to go overboard. We still think that fundamental and technical analysis are important, and that they shouldn’t be skipped over for any reason. Later on as an investor, you might find yourself trying to use market feelings to your advantage. As a beginner, we would advise thinking about the numbers and building a plan from that angel.

As always, you will want to test new theories in a sandbox rather than in real time. That’s a good way to lose money before you even understand how your system will play out. The only difference between a demo account and the real thing is that your demo account doesn’t run on real money. It will still function like a normal forex account, and this is a very important distinction.

We mention sentiment analysis because it’s something that you will probably see in forex forums, and we don’t want you to be thrown off guard. Never feel like you have to add in something just to get attention or to feel like you’re part of a group. It’s perfectly fine to go at your own space in the world of forex — we won’t tell anyone!

One term that keeps popping up in a lot of financial outlets is the “squeeze”. If you’re trying to keep up with what’s being said and having a hard time, you might need to actually read up on the concepts behind what’s being discussed. In this case, you need to understand long and short squeezes in order to figure out not only what they are, but how to handle them as they relate to your trading strategies.

Simply put, a squeeze of any kind is the market price temporarily moving against the longer term direction. This is a “squeeze” primarily when the movement is by a larger amount than first imagined. The squeeze will continue to move forward in the direction expected, but it might take a while.

A long squeeze tends to be the worse, because it’s when the market shifts downwards by a huge amount that tends to throw you off. Does it go back up? Yes, in time — you could be caught by a long squeeze for quite some time. This means that instead of being able to stay in a position as you imagine, you might have to use your stop loss function to back out of the trade before it really starts costing you a lot of money.

Avoiding the long squeeze will come in time. As a newcomer to day trading, you might find that you have to back out of positions a lot more often than you would like. However, over time you will get better at seeing when a long squeeze is going to occur. This is also why it’s so important to make sure that you’re actually reading the markets as they stand rather than just going through the motions and assuming everything can be handled by the chars along. Financial news really does make a difference, and press releases from businesses that are within the market sector still matter a great deal as well.

What about short squeezes? This is going to be just like the long squeeze, but a bit shorter. You will need to make sure that you adjust your position and go through your options either way.

And it cannot be stressed enough — you nee dot make sure that you’re actually learning true trading systems rather than just trading gimmicks. These are part of those “tips” that you hear thrown out on TV without proper analysis of the markets themselves. New traders tend to latch onto these in hopes of making fast money. It’s better to actually make sure that you can focus on the bigger picture rather than just sweeping in for profits without having any idea of how to make more profits.

We will cover just about every angle of investing that you can think of so that at the end of the day, you’re going to become an amazing trader!

So, what lesson do we want you to get today? Binary options trading. As a forex investor, one of the top tools in your arsenal is going to be your strategy itself. If you understand different styles of trading, you can really increase your own strategy. No two traders will use the exact same strategy, because we all think in our own special way.

So, why do so many people get excited about binary options trading? It’s actually very straightforward. You will pretty much know that you will either gain or lose by a given percentage. Every purchase means that you get to know how much you stand to lose. If the value takes a negative turn, you can opt out. If the deal does indeed end in successful, you know the percentage you’ll receive in your returns. It’s important to know that this is usually a fixed rate that’s indicated before the trade actually goes through.

No surprises trading is what you need to remember. A lot of traders want to know exactly where they’re going to stand, because they will be able to budget and plan accordingly.

When it comes to binary options, your broker is going to actually matter a great deal. If they advertise a percentage, then you will need to know that before you plunge in too deeply.

When you trade binary options, you choose whether or not you think the asset in question is going to hit the strike price by the expiration time. It might be the end of the next hour, or even the end of the day. Some traders like to go by the end of the week or the month.

You will need to make sure that you are definitely paying close attention to current events. If things change, you need to know whether or not you want to back out.

There is usually no spread, and therefore no commissions. This gives you a lot of power to control your costs as well.

The percentage of return that you get might be lower than other trading strategies, but isn’t it better to make sure that you focus on the greater picture: success for the long run!