Fxb Blog - Forex Articles

[FXB Trading]

A step-by-step guide on how to start trading

Trading can be an exciting way to earn an additional income. However, before you start trading you need to learn a few things. Knowing what to expect, what tools you need, and a few techniques will help prepare you so your entry into trading is as smooth as possible. The following things need to be considered before you start trading:

1. Getting to know the market

Traders can trade within many different markets which include the stock market, forex market, options market, and Contract for Difference (CFD) markets.

The stock market involves buying/selling shares of a company. The forex market is the largest market in the world and involves the exchange of one currency for another. The options market allows participants to undertake positions in the derivative of an asset, so the option is not ownership of an underlying asset. The contract for difference (CFD) market allows traders to speculate on the rising or falling prices of instruments such as currencies, shares, indices, and commodities.

When a market is moving downwards, it’s called a bear market. You can take advantage of this through ’short selling’ which involves selling assets or (derivative) you do not own in the hope of buying them back at a lower price in the future. The difference is your profit.

Short selling can be very risky as your losses are unlimited and you could lose more money than you actually have in your trading account. This is because the shares could rise so you would have to cover the difference. Therefore, short selling is not advisable for novice traders.

read more

 

[FXB Trading]

The financial advice you wish you’d received at 18

Good financial advice is priceless, and the sooner you get it and apply it the better off in life you’ll be.

Today’s 18-year-olds who are preparing to go to university do so knowing that they are going to rack up a sizeable amount of debt by the time they graduate.

Has anyone sat down with them and fully explained the impact debt has on their life?

Advice about the benefits of getting a good education are echoed everywhere but strangely enough young people get little formal advice about financial planning through regular education channels. Aside from what they hear from their parents, who aren’t always the best at giving guidance on money management, they learn by experience.

The internet offers lots of financial advice in return for a few keystrokes and a couple of clicks but there’s so much out there and much of it is confusing and contradictory.

The financial challenges faced today make being engaged with the world of money more important than ever. Job security is something we reference in history books, banks are a very different entity to what they once were and the world is evolving at a far greater pace than it has ever done in the past and these changes are impacting more people, more quickly than ever before.

Read more

 

[FXB Trading]

Learn to read between the lines to make better trades

So, you’ve got the trading bug. You’ve made your first profits – albeit modest – by making safe trades.

There are riskier trading strategies that can earn bigger profits. You know about them, you’ve been warned about them, and you’re not interested because the downside is too great.

So how do top traders end up making so much more money?

It’s not by taking bigger risks.

Profitable traders earn more because they’re better at predicting and understanding how markets react to news and economic data. They read between the lines of the constant stream of information that is available on trading platforms to make more profitable judgements.

The best traders use information to make a trade before the trend becomes visible to others.

For profitable traders, breaking news stories and economic data is information to be deciphered into factors that can affect the market.

It’s not easy. If it was everyone would do it. But it’s far from impossible, and can be learned.

Understanding economic performance and what affects it is an area that profitable traders excel.

Read more

 

[FXB Trading]

Cryptocurrencies and gold: You need to take a position

Any trader looking to make money on the markets needs to invest time researching before taking a position.

If you do a search on cryptocurrencies it won’t be long before you’ll see an article that compares their merits against gold.

Should you invest your hard-earned money in gold or cryptocurrencies? They ask, and variations on that theme.

The number of these articles implies that they are somehow in competition with each other.

But it’s a phoney war, as they both have a different role to play in the world of finance and in your portfolio.

One of the reasons gold has stood the test of time is the stability it offers against the unpredictability of currencies and the sudden collapses that have taken place throughout history that can wipe out fortunes in an instant.

Gold is the perfect way to hedge against risk, impervious to natural, financial or political disasters.

Cryptocurrencies also offer a viable alternative to traditional currencies because they are decentralised, meaning no central authority can take it away from you.

Read More

 

[FXB Trading]

​

Wise Trading Words from Pro Traders

Ever wonder how professional traders deal with the ups and downs of forex trading? Here’s a glimpse …
The most successful traders view forex trading as a game of possibilities. Sometimes you win, sometimes you lose. In fact, there are occasions in every trader’s career when a losing streak can seem to go on forever. Losses happen, but what sets successful traders apart is the way they deal with the ups and downs of the markets!

If you are at the point in your trading career where you just feel like quitting, take heart … All successful traders went through what you are feeling, but overcame their doubts to become seasoned traders. They still lose some trades, but they understand that losses go with the territory and all that matters at the end of the day is that your profits far outweigh any losses you make.
Read More..

 

[FXB Trading]

Strategies for Successful Trading Decisions Going Short or Long

The Forex market is quickly becoming the focus of attention for millions of new entrants as a result of its unique advantages. A large number of people have learnt how to make clever investment choices in order to take advantage of the market. Two strategies in Forex are going long and going short – once you understand these two strategies you will be able to make important decisions in order to be profitable. The two main strategies will be examined below.

Going Short

This trading strategy is when the base currency is sold in order to buy it at a later stage when the price begins to fall, resulting in a return from the transaction. For example, if the current GBP/USD is 1.5345 meaning we pay 1.5345 Dollars for one Pound Sterling, and we have $1000 dollars, we would sell the Dollars in order to purchase the Pound Sterling. This is carried out when the cost is expected to fall again in a short period of time. When the price GBP/USD falls to 1.5350, this means that more Dollars can be purchased with the same amount of Pounds that were obtained at the start. The additional dollars can be kept as profit which were earned by considering the dollar as the base currency.

Risk in Short Position

As with all financial markets, forex involves the same amount of risk. If the prices go in the exact opposite direction than originally expected, there will be a loss instead of a profit. For example, if the GBP/USD goes to 1.5340, you would not even get the same amount of Dollars that you sold initially. This strategy is only profitable if prices drop.

Read more

 

[FXB Trading]

Is this the best time to get into cryptocurrency?

The financial news has been filled with headlines about cryptocurrency for over a year now and this has undoubtedly played a part in the huge increase in value the likes of Bitcoin and the rest have experienced.

While plenty acted quickly and got in on cryptocurrency, many other potential investors who have been cautiously considering making a move have held back fearing that the opportunity had gone when Bitcoin reached $20,000 and others like Ethereum and Ripple started making big gains.

Warnings about bubbles, regardless of who was making them, have largely gone unheeded. New price records have been set then broken on a regular basis. However, a market correction was always going to happen.

It’s been nothing like the drastic fall some commentators have predicted (remember Bitcoin was valued at around $900 in December 2016). However, on January 17 Bitcoin has tumbled to around $10,000 after reports that a ban on trading of cryptocurrencies in South Korea was possible. The fears of a regulatory crackdown sparked a domino effect on the broader cryptocurrency market with Ethereum dropping 23 per cent and Ripple 33 per cent on the same day.

While some may view this as the beginning of the end of cryptocurrency trading, it’s more likely to be the breather this market will take while the new financial instruments that are growing up around cryptocurrencies settle in and the authorities firm up their decisions on how virtual coins will be regulated.

Read more

 

[FXB Trading]

Forex coaching pays dividends

Trading forex is a bit like driving, if you don’t get a few lessons from someone who knows what they’re doing you’ll probably crash. A good forex trading coach will help you become a profitable trader far sooner than if you dive into trading without proper training.

A good trading coach, much like a good driving instructor, is aware of the mistakes a novice is likely to make and is able to steer you around or away from them and can explain why a certain course of action or choice is the better option. Much like driving, most of us want to learn so that we can use it safely, frequently and of course successfully. Driving without caution or at high speeds, without understanding the dangers, mirrors unprofitable or high risk trading and inherently increases the chance of losing money.

Once you’ve accepted that coaching is the best way to start the next step is choosing which coach is right for you. In most situations where you need an expert, your natural instinct is to gravitate to the best available. This is where most people run into their first hurdle, as the industry is littered with so-called ‘forex gurus’ but who are not even professional traders.

A recommendation from someone you know and trust is always a good place to start, but if no-one you know can advise you on coaching for forex trading there are some things to look out for which will help you make an informed choice.

Read more

 

[FXB Trading]

How to choose technology and industrial stocks

The common denominator for everyone who invests in stocks is to make predictions on the price evolution in order to capitalise on market movements and consequently make money. But how they go about it is dependent on how risk averse they are, and the time frame over which they want to realise profits.

Investing in the stock market is both an intellectual challenge and a reflection of your own character. Before you decide which stocks to pick you need to understand what kind of investor you are.

Growth investors tend to focus on a company’s potential for future profits, and whose earnings are rising the fastest. Since growth-oriented investors are interested in big future earnings, they are often willing to pay a high price for a stock relative to what it earns right now. The metric used to value stocks here is the price-to-earnings ratio (commonly referred to as the P/E).

Value investors hone in on the current value of a company’s assets (factoring in its debts), and look for stocks that are cheap compared to those assets. Optimistic forecasts for profits are less important for them so they end up buying stocks with lower P/E ratios.

Taking the value approach sounds like a more conservative approach, but there is the risk that these stocks go out of style for long periods of time.

What may have initially looked like a bargain may turn out to a bad investment which other investors avoided because they identified serious problems with the business.

That’s why solid research is critical when buying stocks, and the most common advice you’ll read about investing in stocks is to diversify.

Read more

 

[FXB Trading]

​

If you are interested in buying cryptocurrencies, there are many crypto exchanges operating all around the world that allow you to buy cryptocurrencies. It is a good idea to register and verify your accounts with multiple exchanges. The reason for this is that the process can take time if there is an increase in registrations every time there is an increase in the price of Bitcoin. Different crypto exchanges have different features, fees, policies and coin listings. Leading brokers usually allow clients to use fiat currencies to buy cryptocurrency. These are traditional currencies such as Euros, Dollars and the British Pound.

A guide for buying cryptocurrencies
Once you have a basic understanding of cryptocurrencies, you can follow the steps below in order to start building your own portfolio.

1) Open an account with a cryptocurrency exchange
The first thing you need is to know where to buy cryptocurrencies. If you want to buy Bitcoin, there is a wide range of exchanges to choose from. Make sure your desired cryptocurrency is listed on the exchange. Always research your chosen cryptocurrency exchange and read reviews.

2) Choose the cryptocurrencies you want to invest in long-term
You can invest in multiple cryptocurrencies. However, it is advisable to start with one currency first. There is a wide range of cryptocurrencies to choose from. There are thousands of cryptocurrencies available on exchanges around the world.

If you want to invest, you should enter initially with small amounts to familiarize yourself with the basic functions of the exchange.

It is also important to get used to the market volatility so that you don’t panic sell. During a rapid fall in prices, price swings can be huge in a very short period of time.

3) What price is your chosen cryptocurrency trading at?
An important thing you need to take into account is the price of your preferred cryptocurrency. For instance, you need to determine if it is cheap, at a high price or a low price. You should never make a purchase based solely on the price, but you should consider other factors as well. These factors are valuation, the available supply of currency, the technology it uses and the targeted market.

In order to maximize your gains, it is essential that you apply the ‘buy low, sell high’ principle. This is a successful cryptocurrency trading strategy.

4) Store your cryptocurrencies in a wallet
A cryptocurrency wallet acts like a bank account for your cryptocurrencies. Bitcoins are stored in a bitcoin wallet and Ethereum coins are stored in an Ethereum wallet. The same applies to all other cryptocurrencies which are stored in the appropriate wallet.

Basically, a wallet is software which communicates with the network. You can tell the blockchain when you want to send or receive transactions.

Cryptocurrencies can be stored both online and offline in a paper wallet or a hardware wallet, and can also be stored on the exchanges where you bought them.

Read more