Learning to Trade on the Forex Market

By Gerald Greene

Learning to trade forex online is easy. Learning to select the right dealing firm and to trade forex well and at a profit is more of a challenge.

There are several outstanding reasons why learning to trade forex is a worthwhile educational project. Forex, or foreign exchange trading is the granddaddy of them all in the trading field. Daily volumes are into several trillions of dollars. The huge size of the forex market reflects the basic use of money by everyone in the modern world. This massive activity every business day means that the skilled forex trader has a virtually unlimited pool of money to tap into almost at will.

After learning to trade forex the more successful forex traders can make hundreds, even thousands, of dollars every business day right from their own home or office computer. One of the most successful forex traders ever, George Soros, once made over a billion dollars in just a couple days time by correctly forecasting that the Bank of England would not be able to support an overvalued British Pound.

Once Soros had completed his analysis he took massive action and placed a large short position against the Pound. As the Pound collapsed Soros made his fortune.

So to come back to the good reasons as to why learning to trade forex may be a terrific idea for those new wannabe traders who have risk capital to trade with:

1. The forex market is where the huge money is. There are no limits as to what a skilled trader can earn from the forex market.

2. The forex market is international and in major currencies extremely active. You can trade forex 24 hours a day five days a week.

3. The forex market is super liquid. This means that there is always a tight dealing quote at which you can buy or sell active currencies.

4. Forex trading usually comes at you in a hurry. Your trade will most often move into a profit or hit a stop loss point within a few hours, sometimes within minutes or even seconds.

5. Currencies usually trend one way for long time periods. It is not unusual for a currency to have a major trend in one direction for three to five years at a time. When you trade with the major trend this gives you a trading edge.

If there is one point above all others about learning to trade forex it is this one. Your chances of having a successful outcome to your trade are increased tremendously when you trade with the major trend. When you enter your trade on a reaction (correction) within the trend your odds of completing a successful trade increase even further.

As an example, let us say that you have identified the Euro as being in a major uptrend against the US Dollar. This is easy to determine by looking at a long term chart of the Euro against the Dollar. Instead of immediately placing a trade into the forex market and buying the Euro at its current level you wait until a correction takes place and buy the Euro on a pullback. This takes some patience and discipline to do but the payoff can be huge.

Once the major trend again kicks in your Euro position moves immediately to a profit. Then you have the difficult but pleasant decision to make as to when to take your profit. Learning to trade forex can be learned by breaking trades down into a series of easy to follow rules. But you must perform better than most traders and follow your rules.

The key to learning to trade forex at a profit is to take your time and make a careful analysis as to the direction of the trend. Then you must wait for a good entry point. Patience and discipline are the hallmarks of the most successful forex traders.

To gain immediate free access to a wealth of forex information written by a forex successful trader check out Learning to Trade Forex and Forex Trading Secrets Revealed.

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