Are you a beginner trader and want to enter the Forex market? Then it's important that you know how the market will work in 2020. The Forex or currency market represents the value of currencies in relation to each other. Trading and analysis techniques can therefore change from one moment to the next. To help you understand what is special about this market in 2020, we take a look at the issue in this article.
What is Forex?
Still called the foreign exchange market, or currency market, Forex is a comparison of the value of the different currencies of the world. It brings together many market players, including both individuals and professionals. To get started in Forex, it is important to learn the technical terms as well as the best techniques to make a profit. You obviously need to train yourself, because being a Forex trader is a profession in its own right that requires a lot of technical knowledge.
When you enter the Forex trading, you benefit from several advantages. Firstly, the market has very high liquidity, and the Forex time quotation is 24 hours a day, 5 days a week. This means that it is an open market day and night, allowing traders anywhere in the world to trade the currency pairs of their choice. In the list of the most popular currencies in trading, the Euro and the US Dollar are at the top of the list.
In 2020, this market has seen a lot of improvement with the appearance of several online trusted forex brokers. These intermediaries allow novice traders to start a Forex trading activity with a small budget to make extra cash.
What can you learn from Forex Quotation?
The first thing you need to know about currency quotes is that currencies are paired in the Forex market. So, whenever you follow the price of a pair, you should know that it is a comparison of one currency against another. Quotes are therefore defined as the price of one currency expressed in another.
As far as the value of the quote is concerned, it represents the amount of buying and selling of one currency against another. Taking EUR/GBP as an example on a chart, we generally see an exchange rate of 0.886 0 – 0.886 2. According to this rate, one euro is worth about 0.8860 when buying and 0.8862 when selling. In order to better understand the exchange rate, you need to master the concept of Spread.
What is Spread in Forex?
For a basic understanding, Spread is the difference between the buying and selling price. In commercial language, we will talk about the difference between supply and demand. This value also represents the brokerage fees.
The unit of measurement for spread is the pips in the Forex market. Most spreads are only felt to the 4th decimal place. However, some brokers can often choose to quote to 5 decimal places. But rest assured, this does not affect the value of the spread.
How to learn Forex trading in 2020?
This question is the first challenge for all foreign exchange market beginners. Several means have been developed to learn how to trade, but two have remained essential: learn by yourself on the internet on sites like ForexBlog.com or follow a Forex training course. It is important to take one of these steps before you think about risking your hard-earned money.
What are the basics of trading in 2020?
Before you start investing in 2020, you need to learn all the basics of trading. It's not just a matter of mastering how it works, but of acquiring and developing your own Forex trading techniques. To make sure you master the fundamentals, here is a list of questions to which you should have clear and precise answers:
- What is Forex trading?
- How do I start Forex trading?
- Who is involved in Forex trading?
- What are the different types of trading?
- Do you need to take a training course?
- Do you need coaching?
- How to choose your broker?
- How to make a technical analysis?
- How to place a trade?
If you are able to answer all these questions, then you can start the adventure.