What is the function of forex and what is the job of a trader?
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Trade and exchange of goods have existed since ancient times, and merchants engaged in trade in the form of goods for goods, and then money for goods, which appeared later due to the many problems that arose due to traditional markets and technological progress. With the increasing activity of smartphones and social networks, as well as the development of the Internet, new financial markets with a more professional and modern mechanism have appeared.
What is the job of a trader?
The Forex market is one of the newest, largest, and most popular financial markets in the world but you must make an effort to make forex trading profitable and successful. And in this process the trader is a key person. Trader is a guy who trades – it’s obvious. In financial markets such as the stock market, cryptocurrency market and Forex, individual traders trade assets such as securities, commodities, currency pairs, etc. Traders carry out transactions for personal use or for another person, institution, bank, etc.
How did forex appear and what is it
Forex, short for Foreign Exchange Market, is one of the largest decentralized financial and investment markets where currencies of different countries are traded. The Forex market is an international market where all interested people from all over the world can trade currency pairs, cryptocurrencies, well–known indices, and shares of large companies such as Apple, Google, Microsoft, etc. Participants in the Forex market include central banks of countries, major global banks, financial institutions, trading companies, traders and investors, and ordinary people. Banks and financial companies cover most of the market, but traders and individuals represent only 5% of the forex market with their capital.
What is the function of forex?
The ultimate goals of Forex trading are practical and business-focused, but many enthusiasts enter this worldwide market in order to make a profit. Today, millions of people from all over the world are taking part in trading on the market because Forex trading is the second source of additional income, which, of course, will become your only job and source of income if you become a professional in this market.
What is traded on forex?
In the Forex market, currencies from different countries are bought and sold in pairs. The national currency of each country is also displayed as a three-letter code, for example, USD, US dollar, euro, European euro, pound sterling, British pound, Swiss franc, Swiss franc, etc., where the first two letters indicate the country or region, and the third is the first letter of that country’s currency.
Currency pairs
Currency pairs are divided into major, minor, and regional currency pairs. Major currency pairs are currency pairs in which the US dollar is on the same side, including EUR/USD, USD/JPY, GBP/USD, USD/CHF, USD/CAD, and AUD/USD. According to the advice of activists and professionals, it is best to buy and sell major currency pairs, since they have the highest trading volume on the market and high liquidity. The USD/EUR currency pair has the highest trading volume – 84%.
What skills do traders need?
The most important necessary skills that a trader must acquire are:
- Technical analysis: Technical analysis is a method of forecasting prices on charts and graphs. In technical analysis, the price is predicted using tools such as trend lines, Fibonacci, indicators, price models, candlesticks, determination of support and resistance levels, trading volume, trend detection, etc;
- Fundamental analysis. Fundamental analysis fundamentally examines a currency or stock and focuses on the financial and economic events of a company, news, and economic decisions of the government. The Federal Reserve’s interest rate, inflation, unemployment rate, economic growth, etc. are just some of the things that a trader should consider when trading from a fundamental point of view;
Money management: Money management in financial markets is crucial because if you don’t have money management, it’s not far from the initial loss of all capital. Therefore, you must have the right money management strategy and use only a portion of your capital in each transaction.
If you’re looking for resources to help you get started with Forex trading, programs like My Forex Funds provide a platform to hone your trading skills and potentially grow your capital.
Conclusion
The Forex market has become one of the most profitable financial markets due to its high trading value, which has attracted many enthusiasts. But the acquisition of knowledge and skills is necessary for the presence and activity in the Forex market and making a profit. Anyone who is interested should first familiarize themselves with the basic concepts of the Forex market, and then raise their knowledge and skills to a more professional level in order to be able to trade profitably.
