How does Foreign Currency Operate

Foreign currency trading, or more commonly known as Forex trading, can be done on a daily, weekly or monthly basis. There two ways of trading, which can be done separately or in conjunction with each other.The two options are as follow:

1. Fundamental Analysis

With this type of trading your will study the economics, politics, available financial and other reports to form an idea of what the market will do with a specific currency pair or commodity. You need a lot of time on hand to opt into this type of trading, and would not necessarily be able to do this on a part time basis.

2. Technical Analysis

With this type of trading, you will study the price action of specific currency pair or commodity, with the use of various tools to measure this. One would typically make use of candlestick charts on a hour, 4-hour or daily basis. You would not necessarily focus on politics or other factors, but will concentrate on the trend / market movement of the chart. A market will do three things … up, down or sideways.

This is a lot less time consuming, and trading can be done daily or weekly without influencing your full-time work or business.

Hope this article assisted you to decide what type of trading you would want to follow.

Note: Currencies, Commodities, Cryptocurrencies and CFD’s traded on margin carry a high degree of risk. As such they may not be suitable for all investors. Investors should ensure they fully understand the risks associated with leveraged financial trading before deciding to trade because you can lose some or all invested capital. Investors may choose to seek independent advice and should not risk more than they are prepared to lose.


Forex Company Comparison:

Please see the various online forex companies reviews below:



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Shaw Academy: FREE Financial Trading Course.
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