Forex Trading: The Best Education You Can Have

Posted by Biz Online

People trade in a daily basis. Some trade their services for money, while others trade products like food, toys and other things for money. People trade to earn money to properly live their everyday lives.

This is why people work, why people put up businesses and why people trade in the financial market. Today, it’s all about money in order for you to give yourself and your family a comfortable life.

If you are considering making money aside from your day job or starting a career, you can do so by trading in Forex. Surprisingly, most people don’t understand how Forex works but are still interested to trade in this financial market. Besides, people would really want to trade in the largest, the most liquid financial market in the world.

Forex operates 24 hours a day and 7 days a week with no centralized location unlike other financial markets. It involves all the currency in the world and trillions of dollars are being exchanged everyday in this market, thus, making it the worlds largest and the most liquid financial market in the world.

The Forex market promises traders a promising way to earn money. However, Forex also has its risk and it is a fact that people lose money trading in this market. But, there are also people who became millionaires in the Forex market almost overnight. Education is the key to start trading in the Forex market. Without the proper knowledge in Forex trading, chances are you will end up losing money.

First of all, before you trade in Forex, this market is the buying and selling of currencies. In simpler terms, you, as a Forex trader, will be purchasing one kind of currency against another kind of currency. This gave Forex a trend to trade in pairs.

If you traveled to another country, chances are, you traded your currency against the local country’s currency to enable you to buy things from that country. If you did this, you have a good idea on how Forex works.

If you want to trade in this ever liquid market, you have to get the best education possible in trading currencies. A good education will enable you to trade in Forex more effectively and increase your chances of earning a considerable amount of money. It is even known that lots of people have quit their day job to concentrate in Forex trading.

Getting a good education about Forex trading will also let you increase your chances of profiting and decrease the risks involved. In getting the proper education in Forex trading, you will also learn how to read Forex charts. Forex charts are one of the most important things you should learn in order to successfully trade in the Forex market. Without this knowledge, you are doomed to fail in this very liquid market.

Expert Forex traders said that the best way to learn Forex is by actually trading in the Forex market. For this, website developers and software developers have developed a program that you can use to practice trading Forex. There are websites available that will enable you to open a dummy Forex account where you can trade in a simulated Forex market using no money at all. With this kind of software, you can really learn the way Forex works. It is also a great program to get the feel of the Forex market and you can even consider it as a stepping stone to start trading in a real account.

Thanks to the internet and the advancement in technology, everyone can trade in this financial market. Unlike in the past, only the multi-national companies and financial institutions, such as banks are allowed to participate in the Forex market.

Trading Forex is relatively easy to start. All you need is a computer with an active internet connection (high speed internet), a funded Forex account, and a trading system.

Always remember beside the fact that Forex can give you the potential to earn a lot of money, the risks involved is also equally great. So, you should first read books about Forex trading that is readily available in the internet for purchase or for download. You have to learn about the major currencies traded in the market, about leverage, and also about minimizing the risks in trading.

Bernanke affirms QE3, not seeing the “potential costs of the increased risk-taking”

It has been almost 6 months since the third round of quantitative easing began in America.

The Chairman of the Federal Reserve Ben Bernanke has not wavered on his positive outlook for the QE program.

This quantitative easing effort is one of a different breed, it provides unlimited QE to the Federal Reserve. Therefore, QE3 could go on for the next 20 years, or it could stop tomorrow.

Not only is the time frame unlimited, the amount of money the Fed can create is unlimited. Currently the Federal Reserve is buying $85 billion worth in bonds every month. This number could increase or decrease depending on the preference of the Fed. This process is to go on until the Fed thinks the job market has meet their vague “improve substantially” target.

Potential cost of QE3 downplayed “To this point we do not see the potential costs of the increased risk-taking in some financial markets as outweighing the benefits of promoting a stronger economic recovery and more rapid job creation,” Fed Head Mr. Bernanke said in a meeting on Tuesday. (NY Times)

They do not “see the potential costs of increased risk-taking”. Isn’t this how America got to where it is today economically? It is because we didn’t see the cost of our risk taking. Instead of looking 50 years down the road, we have looked at 4 years down the road over and over again. Therefore, our national debt is over 16 trillion dollars and doesn’t show any sign of slowing down.

The potential risk of continued quantitative easing is inflation. As the Fed creates more money, money becomes less valuable. It is simple economics. Therefore, while the bank’s Fed accounts continue to be filled up, American grocery bills may start to go up. One of the most significant caution signs of the QE3 process is that there is no defined goal. “Improve substantially” (September Meeting Minutes) is as clear as mud, yet the Fed is continuing to pursue a better job market. Hopefully Bernanke and the Federal Reserve do have some definition to “improve substantially” even though they are not sharing it with the public.

How does this influence the Forex market? The risk aversion capacity of the U.S. Dollar could be running thin. Yes, it is still to be considered a safe haven, but in the next few years (if the economy continues to go in the same direction that is going) I think it’s reputation could be so poor that it’s safe haven status could be decrepit. Therefore, if inflation would take place, or another crises like monetary situation, the value of the U.S. Dollar could significantly decrease.