How to execute forex trading
Forex currencies always appear in pairs, for example: EUR/USD, GBP/USD, USD/JPY.
In forex trading, you can either buy (go long) or sell (go short). However, when you trade forex currency pairs online, you are not buying or selling real money. You are actually betting on the rise or fall of currency pairs. The price changes of various commodities and stocks coexist with the value of alternative currencies, and the rise or fall of a currency is actually the rise or fall relative to another currency.
With GF, you can trade direct and cross currencies with a minimum account capital of only $100.
Unlike other financial markets, the forex market does not have a fixed central exchange or physical location. Banks, large companies and individual traders form a 24-hour global network of forex trading. This means that forex rates fluctuate 24 hours a day, providing many trading opportunities.
Buy-Long
If the market trend is judged to be upward, you can buy financial products and hold them, wait for them to rise and then sell them to earn the price difference.
Sell - Short
If you expect the market to fall, you sell your stocks and then buy them back after the price drops. To put it simply, you sell first and buy later.
Start Forex Trading in Five Simple Steps
Join a 24-hour global network of banks, large companies and individual traders trading foreign exchange
1. Choose a Forex currency pair
The first decision you have to make as a forex trader is to choose the forex currency pair you want to trade.
At GF, we offer you a wide range of products including straight and cross currency pairs. New traders often start trading with the currency pairs they are most familiar with, and then look for trading opportunities in other less familiar currency pairs.
2. Determine the buying and selling direction
After choosing your trading partner, you should decide whether to buy or sell by speculating on the future direction of the market. A foreign exchange currency pair consists of two currencies, the first currency is called the “base currency” and the second currency is called the “quote currency”, so:
– If you think the base currency is stronger than the quote currency, or the quote currency is weaker than the base currency, then buy the currency pair.
– If you think the base currency is weaker than the quote currency, or the quote currency is stronger than the base currency, then sell the currency pair.
At the same time, each currency pair has two prices at all times. One is the selling price and the other is the buying price. The difference between the two prices is called the “spread”, which is your transaction cost.
3. Set Stop Loss/Take Profit
Stop loss/profit is a pre-set price. When the exchange rate reaches this pre-set price, the corresponding position will be automatically closed.
The purpose of setting stop loss/profit is to lock in the profit or loss of the position.
4. Monitor your trading positions
Before you close your position, your profit and loss (P&L) will change with price fluctuations.
So it is very important to monitor your P&L in real time. By monitoring your P&L, you can add to your position or close it immediately when needed.
5. Close your position
It is crucial for foreign exchange investors to identify favorable market trends and close your positions in time to realize the difference profit or avoid losses when the trend is opposite.
Forex quotes usually have five decimal places. The fourth decimal place is the most important, which is what people often call “points”. We often use points to calculate profits and losses. Forex trading volume is generally counted in “lots”, 1 lot equals 100,000 base currency units. You can also trade smaller units than 1 lot, such as mini lots or micro lots. Mini lots correspond to 10,000 currency units (0.1 lots) and micro lots correspond to 1000 currency units (0.01 lots).
Support Leverage
You can use leverage to open a position that is larger than your capital. This can lead to greater profits or losses. Therefore, it is important to manage risk when trading forex.
Funding threshold
When trading foreign exchange online, you can decide the size of your position. Deposit the appropriate amount of funds to participate in the transaction according to your own situation.
Full day trading
The Forex market is open for trading from Monday morning to Saturday morning. This makes the Forex market an ideal trading market for amateur traders.