Forex Trading Learning Tips For Beginners
The purpose of forex trading itself is none other than estimating the direction of price changes, so that traders can benefit from the difference between buying and selling values. However, learning forex trading is not as easy as imagined. This is evident from most people who are just learning forex. Traders will quickly go bankrupt. Here are some tips to learn forex trading that can be mastered in a short time.
Understand Common Terms Used For Forex Trading
Before making any investment, traders need to understand the various terms used in the trading process. Some general terms to know are:
- A pip is the change in value between two currencies, referring to 4 decimal places behind the comma in the exchange rate. If EUR/USD is at 1.1205 and then moves to 1.1206, the difference of 0.0001 is 1 pip
- A lot is the number of units of currency bought or sold, divided into mini, micro and nano sizes.
- Buy is a position to buy. Usually a buy is done if the price is expected to rise
- Sell is done if the price is expected to fall. Traders sell at high prices, then buy back when prices are low. The difference will be your profit
- Leverage is a loan given by a broker to help traders so they can trade in high volumes
Choose the Right Forex Trading Broker
Forex trading occurs between two parties, namely a trader and a broker, without a central exchange authority. The role of the broker is very important. Brokers are liaisons between market participants and the international forex market. Brokers also provide facilities so that people can transact online.
Make sure that the broker has clear permits and regulations. For local forex brokers in Indonesia, their existence is regulated by CoFTRA. As for international forex brokers, their existence is regulated by several countries.
Watch the video below for more complete and detailed information!
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