Forex For Beginners, Forex Trading Tutorial For Beginners

TipsSeo Trading – Forex Trading Learning Tutorial For Beginners, If you want to learn how to become a professional currency trader in the foreign exchange market? The currency trading process seems very easy on the surface but in reality it is more difficult than it looks.

The currency trading tutorials you will receive here will give you a basic idea of ​​how it works. However, you should keep in mind that this tutorial is only scratching the surface of the basics. The Forex market is complex, fast-paced and requires serious further study if you want to trade successfully.

Now that that disclaimer is over, let’s start by looking at the fundamental unit involved in each trade: the ‘learning forex trading tutorial for beginners’.

What is a currency pair?

A currency pair is a unit of 2 currencies involved in foreign exchange trading. For example, if you want to sell US dollars to buy Euros, you will see the quoted exchange rate for the EUR/USD currency pair. Or, if you wanted to sell Euros to buy US dollars, you would see the opposite exchange rate for the USD/EUR currency pair.

You may be thinking: “Isn’t that the same thing?” Well, almost, but you have to look at the correct pairs, in the right order, based on the currency being bought.

 

Forex Trading Tutorial For Beginners

There are two reasons to do this:

#1. it is easier to calculate your exchange yield in terms of how much base currency you can buy with your ‘quote’ currency. Your base currency is the currency you want to buy, and the quote currency is the currency you want to sell in exchange for the base currency.

When quoting exchange rates, your broker will list the base currency first in the pair, and the quote currency second.

This means that when you look at a pair like EUR/USD, you are looking at the cost of 1 Euro in US Dollars. The quote of the EUR/USD exchange rate = 1.4436 means that 1 Euro costs $1.4436 in US Dollars.

Likewise, the USD/EUR pair shows the cost of 1 US Dollar in Euros. The exchange rate USD/EUR = 0.6834 means 1 US Dollar costs 0.6834 Euro.

#2. To see the correct buy/sell order pair is because you want to know the difference between the ‘bid price’ (the exchange rate) and the ‘ask price’ (what market makers want for the currency).

The difference between the bid price and the ask price forms what is known as the ‘spread’. Forex traders are subject to spreads when opening or closing trades in long positions.

In other words, you are always exposed to the spread when you buy, regardless of whether you open or close a trade.

Open buy -> spread

Close sell -> no spread

Open sell -> no spread

Close buy -> spread

Let’s say traders want to buy the EUR/USD pair. The bid price is 1.4436. The ask price is probably around 1.4440. You have to pay a spread of 0.0004 to place a trade.

Those are the basics of currency trading, but there are other factors to consider. To profit from currency exchange, you must also know how

to calculate the cash value of exchange rate fluctuations in terms of ‘basis points’ – or, in Forex jargon – ‘pips value’.

This currency trading tutorial won’t cover pip values, but it is a concept you should investigate further if you want to master the basics of foreign exchange trading.

 

 

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