Forex Trading

Forex Trade

What are the reasons to engage in forex trading?

Why Trade Forex?
The forex currency market provides day traders with the opportunity to speculate on movements in foreign exchange markets and specific economies or regions. Additionally, with no central market, forex offers trading opportunities around the clock.
Liquidity – In the 2020 forex market, the average volume traded per day is $6.6 trillion, providing an abundance of trading opportunities.
Diversity – With pairs stemming from the eight major global currencies and various regional currency pairings available for trade, forex trading offers numerous options and opportunities to profit.
Accessibility – The forex market is readily accessible, open twenty-four hours a day, five days a week, allowing traders to decide when and how to trade.
Leverage – Many forex currency pairings are traded on margin, enabling traders to buy and sell large quantities of currency. Increased quantity means the potential for greater profits (or losses).
Low Commissions – Forex trading typically involves relatively low costs and fees compared to other markets. Some firms do not charge any commission at all, with traders paying just the bid/ask spreads. True ECN firms may even offer zero spreads.

Which currencies are traded in the forex market?

Major

In the world of international forex day trading, the majority of traders focus on the seven most liquid currency pairs, which include the following major pairs:
EUR/USD (Euro/US Dollar)
USD/JPY (US Dollar/Japanese Yen)
GBP/USD (British pound/dollar)
USD/CHF (dollar/Swiss franc)
Additionally, there are three emerging pairs::
AUD/USD (Australian dollar/dollar)
USD/CAD (dollar/Canadian dollar)
NZD/USD (New Zealand dollar/dollar)
These major currency pairs, along with various other combinations, make up over 95% of all speculative trading in the forex market, including retail forex. It's worth noting that the US dollar is prevalent in the major currency pairings due to its status as the world's leading reserve currency, playing a role in approximately 88% of currency trades.

Minor

If a currency pairing doesn’t include the US dollar, it’s known as a ‘minor currency pair’ or a ‘cross-currency pair’. Hence the most popularly traded minor currency pairs include the British pound, Euro, or Japanese yen, such as: EUR/GBP (euro/British pound) EUR/AUD (euro/Australian dollar) GBP/JPY (British pound/Japanese yen) CHF/JPY (Swiss franc/Japanese yen) You can also delve into the trade of exotic currencies such as the Thai Baht (THB), South African Rand (ZAR) and Norwegian Krone (NOK). However, these exotic extras bring with them a greater degree of risk and volatility.

How to Find the Top Forex Broker

So, how do you begin forex trading? Forex trading requires a broker (such as SpaceTrading), so your first step is to find one. While it's tempting to opt for well-known names or established groups in the forex industry, the best forex broker can vary from person to person, with each having its own pros and cons. This means that objective rankings may be less helpful, and your choice may ultimately depend on factors such as the currency pairs you wish to trade, the trading platform, whether you prefer trading using spot markets or per point, or simply ease of use.
Below is a list of comparison factors that should be taken into account before deciding on a broker. Some factors may be more important to you than others, but all deserve careful consideration. You can find details on each of these elements for individual brands in their respective reviews.

Most competitive trading fees

Spreads, commissions, overnight fees – all factors that can diminish your profit on a single trade must be taken into account. With high-frequency trading, these costs can escalate rapidly, making fee comparison a crucial aspect of selecting a broker. Brokers like (SpaceTrading) provide commission-free trading, although this is typically offset by wider spreads.
Inactivity or withdrawal fees are also significant, as they can further deplete your account balance.

Trading software

The trading software should be tailored to your preferences. Whether you prefer a simple, streamlined interface, trading solely via keyboard shortcuts, or a platform with numerous built-in features, widgets, and tools, the best option for you may differ from someone else's.
Several brokers develop their own proprietary trading platforms, such as TD Ameritrade's ThinkOrSwim platform or the iForex trading platform. However, there are also many excellent industry-wide platforms available.
Demo accounts offer a great way to test multiple platforms and determine which one suits you best. Additionally, many platforms are customizable, allowing you to adjust the default view to your liking.

Trading on mobile devices

For some individuals, trading forex on the go is essential, while for others it may be less important. Most brands provide a mobile app that is typically compatible across iOS, Android, and Windows.
If mobile trading is a priority for you, ensure that the app is a full version of the website and does not lack any essential features. Downloading these apps is usually quick and easy, as brokers like (SpaceTrading) aim to facilitate your trading experience.

Customer support

Does customer service offer support in your preferred language, such as Spanish or English? Are there options for live chat, email, and telephone support? What are the hours of availability? The quality of customer support can range from part-time call centers to dedicated personal advisors and forex trading mentors. Some brokers, like Fidelity, have teams providing 24/7 customer support, available to address queries at any time of day, week, or weekend. The importance of this factor is subjective and depends on individual preferences, but it's worth investigating.