Top 15 questions about forex?

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15 Questions You Should Ask Your Forex Broker

  • How long have you been a Forex Broker?
  • In what financial condition is your company? Will you show me your balance sheet?
  • Do you have good relationships with reputable banks?
  • Who is quoting the rates, my broker, a bank, or multiple banks?
  • Are the spreads fixed of variable?
  • How tight are the spreads?

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Answer

What questions should I Ask my forex trading coach?

Having a Forex trading coach to assist you in your trading journey can make a tangible difference and significantly shorten your learning curve. To take full advantage of your coach’s experience, we’ve prepared a list of questions which you can use to ask your coach to get the most out of your relationship. #1 How long have you been trading Forex?

What are the top questions about the foreign exchange market?

1 Top Questions About Foreign Trading and The Foreign Exchange Market. 2 How Is The Foreign Exchange Marketplace Differ From The Others? 3 Is There Commission In Forex Trading? 4 What Does Pip Stand For And What Does It Mean? 5 What Are You Buying And Selling In This Market? 6 Like In Other Markets, Does Forex Trade In Pairs?

Is forex trading suitable for You?

To begin trading and investing in these markets, you should be aware of the risks and willing to accept them as Forex trading involves substantial risks, making not a suitable fit for all investors. Any of the content provided on Elite Forex Trading is given to you purely on a general advice basis and for educational purposes.

How many forex brokers in the world?

Forex is happens when there is an exhcange between two currencies. For example, you have the Euro and you want to buy the Great Britain pound. An exchange will happen between the Euro and the Pound. 46. How many forex brokers in the world? There are at least two hundred active and regulated forex brokers.

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What are some questions to ask about forex?

Most Commonly Asked Questions About ForexWhat is Forex Trading?What are Currency Pairs?What is a PIP?What is a ‘Lot’?When is the Forex Market Open for Trading?What does Long Position Denote?What does Short Position Denote?


What are the most important things to learn in forex?

Alertness and decisiveness are both fundamental ingredients in the recipe for a successful forex trader, and the ability to apply these skills to pressured situations while remaining emotionally and strategically rational will certainly be of benefit in testing situations where things don’t quite go your own way.


What moves the forex market the most?

Key TakeawaysMacroeconomic statistics, such as inflation, have the greatest impact on forex markets.Stock, bond, commodity, and other capital markets also have a strong influence on exchange rates.International trade numbers, such as trade deficits and surpluses, play a vital role in forex markets.More items…


What is the most successful strategy in forex?

Trend trading is one of the most reliable and simple forex trading strategies. As the name suggests, this type of strategy involves trading in the direction of the current price trend. In order to do so effectively, traders must first identify the overarching trend direction, duration, and strength.


Is forex a skill?

If you’re good at solving puzzles and interpreting data, forex trading could be an interesting career route for you – as you’ll already have an analytical mind. Being able to block out distractions for long periods during the trading day is a vital skill.


What is the most important news in forex?

Central Bank Meetings The most important high impact Forex news release are central bank meetings and interest rate decisions. With a mandate to control inflation and ensure the value of the nation’s currency remains steady, central bank meetings have the highest impact on Forex market volatility.


Who runs forex?

It is decentralized in a sense that no one single authority, such as an international agency or government, controls it. The major players in the market are governments (usually through their central banks) and commercial banks.


What factors affect forex?

5 factors that influence the foreign exchange market – Raiz…5 factors that influence the foreign exchange market. Currency values are in constant flux, regularly going up and down in value. … Interest rates. … Economic stability. … Trade-Weighted Index. … World events. … Government debt.


How does forex affect economy?

The currency chosen for exchange attracts an increase in demand and thus translates to an increase in revenue for the traders involved in its exchange. Strong nations whose currencies are high in demand thus get a lot of revenue from the forex market.


Which forex indicator is most profitable?

Fibonacci The most significant part of the Fibonacci tool is the golden ratio of 1.618. In the forex market, traders use this ratio to identify market reversal and the profit-taking area.


What is the best time frame in forex?

As a general rule, traders use a ratio of 1:4 or 1:6 when performing multiple timeframe analysis, where a four- or six-hour chart is used as the longer timeframe, and a one-hour chart is used as the lower timeframe.


What is lock in forex?

A lock (or a locked position) is when a trader doesn’t exit a losing trade but opens the position of the same size in the opposite direction. For example, you open a buy position at the price of 1.16243. The price goes down, i.e. against you. And you open a sell position at 1.16224, WITHOUT CLOSING the buy position.


How many questions are asked about forex trading?

Answers to 67 frequently asked questions about forex trading. » The Trader In you


What time does the forex market open?

Forex markets open Monday at 00:00 GMT and close on Saturday at 00:00 GMT.


Why is it so hard to predict the direction of the forex market?

Because it is impossible to attach forex market movements to one factor, it is hard to predict price direction.


What happens when there is an exhcange between two currencies?

Forex is happens when there is an exhcange between two currencies.


Why do we use common currency?

Because forex enables global trade, to buy goods and services from another country, you have to use a common currency. Meaning you have to buy or sell your local currency to purchase goods and services.


What are the factors that affect forex prices?

Fundamental economic and geopolitical factors drive forex market prices. In essence, these include activities of Central banks, politics, wars, pandemics, and many others. Economic calendars are a great place to keep tabs on critical economic events likely to affect a particular currency pair.


What is forex short for?

Forex is short for Foreign Exchange. If you’ve exchanged your local money for another country’s money in a forex bureau, then you participated in foreign currency exchange.


What is forex indicator?

Forex indicators are tools that simplify the data shown in a graph. They can translate the values shown into an easier-to-read figure, and they can be used to single out specific properties of the market, such as trend strength, price averages, and possible pivotal points.


How old do you have to be to trade forex?

Also, You must be 18 years of age to open a trading account with MOST brokers, some may require you to be 19 or 21.


What is leverage in trading?

Leverage allows a trader to open positions at values higher than what they have in their account. You can open a $100 position with $10 by using a 1:10 leverage, and the difference is given by the broker. This amplifies the return, by increasing the potential profits or losses by the leverage ratio.


What are the factors that affect foreign exchange rates?

There are at least 8 key factors that determine and affect foreign exchange rates; these are: Inflation rates, interest rates, countries’ balance of payments, the government debt, terms of trade, political stability and performance, recession, and speculation.


How does a broker work?

Mainly, they work by giving a direct channel for traders to enter the market. However, this changes regarding the type of broker. The most popular types may trade directly with their clients (market makers) or enable traders to trade among themselves (ECN).


Do binary options pay for forex?

In other words, binary options pay according to your predictions in external assets’ performance, while Forex traders are often actually buying currencies. Additionally, binary options offer fixed profits and losses, but Forex returns depend on the market and your investment entirely.


Can forex trading lead to high profits?

Forex trading can potentially lead you to very high profits just like it could lead you to critical losses. Depending on your risk appetite, knowledge, and trading strategies, profits and losses will be almost unlimited in the Forex market.


What currency pairs do forex dealers trade?

While some dealers may trade in exotic currencies, the forex market typically trades with the seven most liquid currency pairs in the world: These currency pairs along with various combinations of the above, such as the Euro to the New Zealand Dollar, make up a high percentage of all FX trading.


What is the pip in forex?

To give an example, a bottle of shampoo at a drugstore would be priced at $3.50 and in the FX market, it would be priced at $3.5000.


What is bid-ask spread?

What exactly is the bid-ask spread? This spread is the difference in the amount of the ask price and the bid. Often, the ask price surpasses the bid. In this rule, every gain (or profit from the difference) down to the very last penny is considered to be a profit and given to the investor. However, this bid-ask spread is quite tough to overcome and makes scalping in this marketplace that much more difficult.


What is a carry trade liquidation?

Known as the carry trade liquidation, this occurs when it’s decided upon that the carry trade won’t have any future potential. Once this is called, every trader and investor starts to seek his/her exit strategy. Then bids will start to disappear, and ultimately profits from the difference in interest rates aren’t nearly enough to cover all the capital losses. Essentially for the carry trade strategy to successfully work, anticipation is key.


Is forex trading liquid?

While forex trading might seem like the wild wild west right about now, it can be conquered. Like we mentioned above it is the most liquid and fluid market in the world. Encompassing countries in all continents, the sheer size and scope make this market the most readily available in the world.


Do all currencies trade in pairs?

Yes, all currencies are always traded in pairs. Knowing this, traders always know that he/she will always have “more” of one currency and “less” of the other. For example, when trading from EUR/USD, the exchange of euros to dollars would mean that the trader has “less” euros and “more” dollars.


Is there a tangible exchange for forex?

Nothing. In the retail forex trading market, there is no tangible exchange ever. All FX trades exist virtually in a computer and are computed out per market price.


What is a good forex trading coach?

A good Forex trading coach should be able to answer these basic questions without hesitation. The strategy used by your coach can also reveal a lot about their trading style. If they use a lot of fundamentals, he may have a longer-term trading approach based on the daily or weekly chart. On the other hand, coaches who rely primarily on technical …


What is the reward to risk ratio for forex?

You can potentially earn twice as much as you can potentially lose. Good traders use reward-to-risk ratios of more than 1, and your Forex trading coach should be able to determine the best ratio for you based on your trading style, strategy, and experience.


What should a good trading coach assess?

Again, a good trading coach should assess your trading style before giving you a definitive answer to this question. Day traders and scalpers should focus on the most liquid time of a trading day, which is the overlap of the New York and London session. Swing and position traders, on the other hand, are not affected by wider spreads since they hold their trades for a longer period of time and have higher profit targets.


What is the purpose of fundamentals in trading?

Traders who combine fundamentals in their trading are able to anticipate large exchange rate moves and increase the success rate.


How much risk do you take in a trade?

The risk we take in the market is the only thing that we’ve full control over. Successful traders are well aware of this and risk only a small percentage of their total trading account on any single trade. The golden rule is not to risk more than 2% of your trading account on a trade – and as your account rises, consider even to reduce your risk-per-trade to 1%.


What are beginner traders interested in?

Beginner traders are often interested in how much they should trade.


What is range trading?

Ranges are defined as an absence of trends where the price doesn’t manage to form higher highs or lower lows. Also, bear in mind that different trading rules apply when trading ranging markets. Ask your trading coach whether your trading strategy allows taking trades during ranging markets.


How long does forex trading work?

Forex trading works 24 hours a day. Does your Forex Broker? When you ask them questions, do they answer them clearly and honestly or do they give you the run-around? If your Forex Broker can’t answer the 15 questions below, you may want to look for one who can.


Why does size matter in forex?

Size matters. Because the Forex market is an over-the-counter market with no centralized exchange, not everyone receives access to the same prices or quality of execution. Institutions with the largest trade volume and the most solid financials have access to better prices and execution.


How much is a pip in forex?

Most major currency pairs are quoted to four decimal places, so a pip would typically equal .0001 or one basis point. Forex Brokers generally round the price up or down to the nearest pip; but some now offer Fractional Pip-Pricing. It ads an additional decimal place, so spreads are usually tighter and more accurate.


What is a rollover in forex?

Rollover. Rollover is interest earned or paid on Forex positions held overnight. It varies depending on the difference in interest rates between a currency pair and fluctuates day to day with the movement of prices. A Negative Roll is when you sell a currency that pays higher interest rate, so you pay interest.


What is a positive roll in forex?

A Positive Roll is when you buy a currency that pays higher interest rate, so you can earn interest. Negative Rolls are routine, but not all Forex Brokers offer positive rolls. The “Carry Trade” is a popular Forex strategy which benefits from Positive Rolls and the high leverage available in the Forex market.


Is foreign exchange risky?

Be aware that trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.


Do all forex brokers quote the same rate?

Not all Forex Brokers quote rates the same way. Below are two possible options:


What are the terms used in forex?

If you’re a beginner in the Forex market, chances are you’ve stumbled upon an article or forum post that include terms such as “pips”, “cross-pairs”, “margin” and others.


Why is the Forex market open?

The Forex market is open around the clock and offers traders to profit not only on rising prices, but also on falling ones. However, there is another reason why a large number of traders feel attracted to the Forex market – leverage.


How many currencies are there in the world?

The United Nations currently recognise 180 currencies that are used in 195 countries across the world. Some examples of currencies are the US dollar, the Euro, the British pound and the Japanese yen, which all act as a store of value and which are traded on the global foreign exchange market (Forex).


What are the major pairs of currency?

In general, currency pairs can be grouped into major pairs, cross pair , and exotic pairs. Major pairs are currency pairs that include the US dollar as either the base currency or counter-currency and one of the other seven major currencies (EUR, CAD, GBP, CHF, JPY, AUD, NZD.)


How does supply and demand affect currency?

Just like other assets, the forces of supply and demand determine the value of a currency relative to another currency. Increased supply of a currency sinks its value, while increased demand pushes its value up.


What is an example of currency pair?

An example of a currency pair is the EUR/USD pair . When we buy the EUR/USD pair, we’re actually buying the euro and selling the US dollar. Similarly, when we sell the EUR/USD pair, we’re actually selling the euro and buying the US dollar.


Where are currencies traded?

The world’s currencies are traded on the Forex market. But let’s start with the very basics – What is a currency?

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