Forex Trading Definition For Beginners

What Is Forex Trading Market

The word Forex is a combination of two simpler words Foreign Exchange . The simple meaning of Forex Trading is exchange of foreign currencies.

Forex Trading Definition For Beginners

Foreign exchange, commonly known as ‘Forex’ or ‘FX’, is the exchange of one currency for another at an agreed exchange price on the over-the-counter (OTC) market.

Forex is the world’s most traded market, with an average turnover in excess of US$5.3 trillion per day.
Forex Market is where currencies are traded to make profit. Fx Trading market is like any other market where goods are traded.

The only difference between the Fx Trading market and any other market is that goods are bought and sold in other markets whereas currencies are bought and sold in the Fx Trading Market .

For example, you can buy euro by paying AUD (Australian Dollars) or you can buy JPY (Japanese Yen) by paying US dollars.

Currencies are treated like goods in the Fx Trading market. Now you know a little What Is Forex but its not enough, continue below.

Forex Market Hours

Forex Trading is done in the first five days of the week starting from Monday and do not stop for a second till the end of Friday.

It means Fx Trading is done 24 hours in all five days. The Best Forex players in Fx Trading market are large banks, large international corporations and financial institutions.

Different Types Of Currency Pairs

The main concept of the Online Forex market is the “free-floating” currencies. “Free-floating” currencies are those currencies that are not supported by any specific materials like gold or silver.

The profit and loss in Fx Trading market is based on the changes in the value of currencies.

The two widely traded currencies of the Fx market are the US dollar and the Euro. These two currencies are considered as the king of the currencies.

Some other reputed currencies of the Fx Trading market are the Japanese Yen, the Canadian Dollar, the Australian Dollar and the New Zealand Dollar.

Currency Trading Leverage

Foreign exchange is a leveraged product, which means that you are only required to deposit a small percentage of the full value of your position to place a Forex trade.

This means that the potential for profit, or loss, from an initial capital outlay is significantly higher than in traditional trading.

In Forex, traders use leverage to profit from the fluctuations in exchange rates between two different countries.

The leverage that is achievable in the Forex market is one of the highest that investors can obtain.
Leverage is a loan that is provided to an trader by the Forex broker that is handling his or her Forex account.
When an investor decides to invest in the Forex market, he or she must first open up a margin account with a broker.
Usually, the amount of leverage provided is either 50:1, 100:1 or 200:1, depending on the broker and the size of the position the investor is trading.
Standard trading is done on 100,000 units of currency, so for a trade of this size, the leverage provided is usually 50:1 or 100:1. Leverage of 200:1 is usually used for positions of $50,000 or less.
To trade $100,000 of currency, with a margin of 1%, an trader will only have to deposit $1,000 into his or her margin account.
The leverage provided on a trade like this is 100:1. Leverage of this size is significantly larger than the 2:1 leverage commonly provided on equities and the 15:1 leverage provided by the futures market.
Although 100:1 leverage may seem extremely risky, the risk is significantly less when you consider that currency prices usually change by less than 1% during interaday trading.
If currencies fluctuated as much as equities, brokers would not be able to provide as much leverage.

Foreign Exchange Pricing

All FX is quoted in terms of one currency versus another. Each currency pair has a ‘base’ currency and a ‘counter’ currency.
The base currency is the currency on the left of the currency pair and the counter currency is on the right.
For example, in EUR/USD, EUR is the ‘base’ currency and USD the ‘counter’ currency.
Forex price movements are triggered by currencies either appreciating in value (strengthening) or depreciating in value (weakening).
If the price of EUR/USD for example was to fall, this would indicate that the counter currency (US dollars) was appreciating, whilst the base currency (Euros) was depreciating.
When trading Forex prices, you would buy a currency pair if you believed that the base currency will strengthen against the counter currency.
Alternatively, you would sell a currency pair if you believed that the base currency will weaken in value against the counter currency. Some examples of major currency pairs are:
EUR/USD (The value of 1 EUR expressed in US dollars)
USD/CHF (The value of 1 USD expressed in Swiss francs)

Forex Trading Pips

Pip stands for Percentage in Points. Most of our currency pairs are quoted to 5 decimal places with the change from the 4th decimal place (0.0001) in price commonly referred to as a ‘pip'.
For example, if the price of the EUR/USD Forex pair moved from 1.33800 to 1.33920, it is said to have climbed by 12 ‘pips’ (92-80=12).
Spread
The difference in the BID/ASK of the currency pairs is referred to as the 'spread'. An example would be EUR/USD dealing at 1.33800/1.33808 (in this case the spread is 0.8 pips or 0.00008).
The exceptions to this are the JPY pairs which are quoted to just 2 decimal places. A USD/JPY price of 97.41/97.44 displays a 3 pip 'spread'.

How To Trade Forex

To Trade foreign exchange currencies you need to download an online trading platform and to download a trading platform free you need to sign up with a Forex broker and download FX trading platform then open a demo Forex account free and start Forex Trading.

What Is Forex Trading Infographic

To see the full size of Forex trading infographic simply click on it and enjoy complete information about currency trading by this FX infographic made by TopForexBrokers team.

currency Trading infographic

Top 10 Forex Brokers In UK

Top 10 Forex brokers in UK , Australia, Europe, U.S that you can open real or demo currency trading account online to make money from Forex Market.

Top 10 Forex Brokers In The World list

I know its hard to find the best broker to trade currencies online as a trader must spend a lot of time to analysis all Forex Brokers so ForexSQ team made a list of top 10 Forex brokers in the world below.

Fxpro

Fxpro Forex Broker Founded in 2006, London-based FXPro is an online broker offering Forex trading along with CFD's. The MT4, MetaTrader5 and cTrader online trading platforms are available.
Minimum Deposit at Fxpro broker is different and depends on trading platform you choose, Fxpro Minimum Deposit on MT4 and MT5 fx trading platforms is $500 .
Fxpro minimum deposit on cTrader Forex trading platform is $1000.

Fxstay

Fxstay Forex broker team provide professional Forex managed accounts service to their clients.
Fxstay is involved in the Forex trading since 2008 and is lead by the group of experienced Forex account managers from all around the world in Cyprus, Fxstay is legit broker.
Fxstay team provide VIP managed Forex accounts use dedicate teams which include international traders to Managed investors account with low risk.
Fxstay broker team not only specialized in fx market but invest in all other markets like Stocks, hospitality, Oil, Gold, Bonds, Real estate and Startup investing.

HY Markets

HY Markets broker is headquartered in London and is authorized and regulated by the Financial Conduct Authority of the United Kingdom.
HY Pro Trader is an online Forex trading platform for professional traders powered by Currenex.
It’s designed for individuals wanting to trade higher volumes, with fast interbank pricing by a large number of global banks providing the deepest liquidity.
You can read full HY Markets review wrote by TopForexBrokers .

Forex.com

The Forex.com broker Owned by parent company GAIN Capital . Operating since 1999, FOREX.com was a first mover in bringing currency markets to the retail trader.
GAIN Capital is a US provider of online trading services headquartered in Bedminster.
The company provides market access and trade execution services in foreign exchange, contracts for differences and exchange-based products to retail investors.
Trading is provided via one of two electronic trading platforms, its own proprietary FOREXTrader PRO, or MetaTrader 4.
Services are provided to the retail market through its brand FOREX.com and via a number of brokers internationally.

FXCM

Forex Capital Markets, better known as FXCM, is an online Foreign exchange market broker based in the United States.
Forex Capital Markets was founded in 1999 in New York, and was one of the early developers of online Forex trading.
The company provides services through its own online trading platforms and through third party platforms such as MetaTrader 4.
FXCM allows retail and institutional clients to speculate on global foreign exchange markets in what is known as "margin Forex trading".
Outside the US, FXCM also provides trading in contract for difference (CFDs) on major indices and commodities such as gold and crude oil.
The FXCM business model allows retail clients to speculate on Forex markets with leverage.
FXCM promotes a "no dealing desk" business model for its currency products, taking prices from a number of major banks and allowing clients to trade the best price at any given time.
This is also known as a direct market access (DMA) model, in contrast to a market maker model more commonly used by Forex brokers .

Oanda

OANDA broker is a Canadian-based Forex company providing currency conversion, online retail foreign exchange trading (fx), online foreign currency transfers, and Forex information.
In 1996, OANDA Corporation, the US subsidiary, was incorporated in the state of Delaware, and initially provided online access to live currency information that was previously inaccessible to the public at large.
The company’s main product is their electronic trading platform fxTrade .

Saxo Bank

Saxo Bank is a Danish investment bank. It was founded as a brokerage firm in 1992.
The name was changed to Saxo when the company obtained a banking license in 2001.
Saxo bank offers trading through its online platform SaxoTrader in Forex, stocks, CFDs, futures, funds, bonds and futures spreads. Private wealth management services are also offered.
Now you know how to choose the top 10 Forex brokers in the world but countine reading to know about swiss brokers.

Dukascopy Bank

Dukascopy Bank SA is known for its transparency in its Swiss SWFX market place.
They offer direct access to the interbank Forex market. However they do not provide MetaTrader to their clients, instead their clients use Jforex platform to access the market.
Fair Trading Technology's T3 Execution Bridge provide a solution to connect MetaTrader 4 to ECN market.
In June 2011, the product is officially referenced on Dukascopy Bank's official web site.

Swissquote Bank

Swissquote Group Holding SA is a Swiss banking group specializing in the provision of online financial and trading services.
The Group's shares have been listed on the SIX Swiss Exchange under the ticker symbol “SQN” since 29 May 2000.
The Group's headquarters are located in Gland, Switzerland.
The Swissquote Bank also has offices in Zurich, Bern, Dubai, Malta, London and Hong Kong. The Group has 545 employees.

IG

IG Group is a UK-based company providing trading in financial derivatives such as contracts for difference and financial spread betting and, as of 2014, stockbroking to retail traders.
While the majority of the IG Group's activities are based in the UK, the company has expanded internationally.
Now you know how to choose the top 10 Forex brokers in the world.

Fxpro Review By ForexSQ Team

Fxpro review wrote by our best traders at ForexSQ, FxPro is a UK headquartered online Forex broker providing contracts for difference (CFD) on foreign exchange, shares, futures and precious metals primarily to retail clients.

FxPro has operations in London and Cyprus and is regulated by a number of regulatory authorities.

Fxpro Forex Broker Regulation

FxPro Financial Services Limited is licensed and regulated by the Cyprus Securities and Exchange Commission (CySEC).

In 2007 the EU’s Markets in Financial Instruments Directive (MiFID) came into effect.

This allows firms that are regulated in Cyprus to provide investment services anywhere within the European Union.

FxPro Forex Trading broker a wholly owned subsidiary of FxPro Group Ltd, is licensed and
regulated in the United Kingdom by the Financial Conduct Authority.

FxPro Forex broker formerly acted as an introducer to its parent company and did not provide any brokerage services or hold client funds until June 2012.

When the company upgraded its FSA license so it could accept UK clients. Continue reading full Fxpro review by our team below.

Fxpro Review Of Trading Facilities

The company provides traders a choice between the MetaTrader4 and cTrader trading platforms.
Clients using the MT4 platform from MetaQuotes Software also have the option of a web-based alternative, and several mobile trading versions.

The company's cTrader platform Spotware, provides ECN traders with greater price depth and Volume-weighted average price (VWAP).

cTrader is compatible with cAlgo, an algorithmic trading platform that allows clients to create trading robots and run them in cTrader so as to fully automate the trading process.

Since 2013 the company has been engaged in making algorithmic trading accessible to the retail sector.

It launched Quant, a web-based strategy-building solution for the MT4 platform that allows users to create their own trading robots (called Expert Advisors) using a drag and drop interface, or to download them from the company's EA library.

Quant, unlike cAlgo which requires knowledge of C#, enables users to create automated strategies using technical indicators and logical operators without any prior coding knowledge.

In October 2013 FxPro launched its proprietary investment platform FxPro SuperTrader,
Which gives retail or institutional investors the ability to allocate funds to a number of strictly vetted and performance rated FX trading strategies.

Continue reading full Fxpro review by our team below to know more about the Fxpro Forex broker.

FxPro MT4 (Metatrader4) Download and Review

MetaTrader 4 has established itself as the industry standard.

Combining an intuitive user interface with a customisable feature-rich environment,
MT4 provides everything a trader needs to chart assets, place orders and manage their positions.

Add to this FxPro’s advanced trading infrastructure, competitive pricing and FX Agency Model execution, and you have one of the most powerful combinations in online Forex trading.

FxPro offers CFDs through MetaTrader 4 on Forex, futures, selected stocks and spot metals.

FxPro also welcomes algorithmic traders. Use MT4 in conjunction with Expert Advisors to automate your trading.
With access to three different chart types, nine time frames,

over fifty per-installed technical indicators and a fully customisable interface,

MetaTrader4 gives you the ability to monitor the market with precision, perfectly timing your entry and exit each time. Read full Fxpro review about MT4 by our team below.

For Fxpro MetaTrader 4 Download simply click on Fxpro MT4 Download .

FxPro MT5 (Metatrader4) Download and Review

MetaTrader5 is a powerful all-in-one platform that provides you with everything you need to trade the financial markets.

Continuing its predecessor’s impressive legacy, MT5 is both powerful and easy to use, allowing you to customize its layout to suit your trading style.

Analysis the markets with a large selection of per-installed technical indicators and graphical objects, place orders and manage your exposure with ease.

MT5 now allows you to chart assets at 21 different time frames, as well as giving you the ability to have up to 100 charts open at any given time.

Read Fxpro review MT5 features by our team below.
For Fxpro MT5 Download simply click on Fxpro MetaTrader 5 Download.

Fxpro cTrader Trading Platform Review

A relative newcomer to the world of charting platforms, cTrader trading platform has already developed a loyal following among traders who demand an added level of market resolution.

Designed specifically for the trading of CFDs, cTrader is an ECN trading platform allowing traders to place orders while having access to full market depth.

FxPro provides its traders with the best available bid and ask prices, even when they come from competing institutions, and fills orders at VWAP (volume weighted average price),
executing through the available liquidity tiers until the order is filled.

This enables us to offer some of the tightest spreads in the industry on cTrader trading platform, with raw spreads from 0 pips on highly liquid pairs such as EUR/USD.

For Fxpro cTrader Download simply click on Fxpro cTrader Download

Fxpro Supertrader Review

FxPro SuperTrader is an investment platform which gives you the ability to copy and allocate funds to the trading strategies of SuperTrader leaders.

In this way you are able to create your own portfolios of strategies according to your individual risk/return preferences, without having to actually place any trades yourself.

Leaders do the trading, and investors decide on how much capital they want to allocate to each strategy, and how they want to manage their risk.

Please note Fxpro SuperTrader accounts are not currently available for FxPro UK Limited registered clients.
For clients who have previously been approved by our Back Office department,
your SuperTrader account will be approved once a Limited Power of Attorney has been accepted via the online form in Direct.

For new or existing clients who haven’t provided the relevant documentation, their account will remain pending until these documents have been received, reviewed and verified.

Fxpro Minimum Deposit and Withdrawal Methods

Minimum Deposit at Fxpro broker is different and depends on trading platform you choose, Fxpro Minimum Deposit on MT4 and MT5 fx trading platforms is $500 .

Fxpro minimum deposit on cTrader Forex trading platform is $1000.

Fxpro Direct

FxPro Direct is your online account management page.

To login to Fxpro Direct Signing in to the FxPro homepage automatically takes you to your personal FxPro Direct profile from which you can create new accounts,
Edit existing ones, fund your active trading accounts and download all of the various trading platforms we offer.

Fxpro Demo Account

Fxpro Demo trading accounts are the perfect way to practice Forex trading in a risk free environment before committing any of your own money to the markets.

Demo accounts are completely free.
To open your free Fxpro Demo Account Simply click on Fxpro Demo Forex Trading Account.

Fxpro UK Office

Fxpro Forex broker headquarters office address is : 13/14 Basinghall Street, City of London, EC2V 5BQ.