Forex Trading

Forex Trading involves making bets on whether a particular currency will gain vs another currency. Traditionally forex trading was only done by large banks and this didn’t open to the general public until the early 00′s. Since then forex has grown to be huge with millions of traders all around the world.

The forex market does about 1 Trillion dollars a day.  The majority of forex trading is done by large banks on behalf of businesses (Ex: A European company buys a Canadian company and needs to convert 100 Million euros in funds), hedge funds and large spec traders who speculate on the price and aim to make a profit.

One of the trickiest things about forex trading is that there are literally thousands of different ways that you can view the charts and interpret the information. If you want to know a lot about forex then it takes a lot of time to study all of the different types of methods like: elliott wave, fibonacci, moving averages, the pitchfork, bollinger bands, awesome indicators, support and resistance, market flow, multiple time frame, correlation, fundamentals, etc, etc.

Then, you’ve got human emotions which mainly conspire for you to lose. The reptilian part of our brain is very influenced by Fear and Greed. These 2 emotions are known to influence the vast majority of traders, you know the 95% of forex traders who will lose their money and give up, aka, the sheep on their way to the slaughter, fish (poker terms), or most famously “The Dumb Money”.  This is all really funny when you have achieved success, but it can sure make you angry when you’ve been losing your hard earned money, I know how that feels.

The internet is full of forex forums and blogs about forex and all sorts of information and misinformation. There are so many places where you can start and end up it is truly mind boggling.

Richard Dennis was asked, “what advice to do you have for new traders?” and responded “Find someone who is already a professional trader and get them to manage your money, then enjoy your life.”

Beautiful.