How to open a Forex Account

The first thing you do is to fill out an application as well as providing authentic identification.

1. To open a forex account, all you have to do is simply fill out an application and provide all the necessary identification. The application comes with a margin agreement will state if the broker will be allowed to intervene with any trade when it appears too risky. The aim of the agreement is to protect the interests of the broker; this is because most trades are done by using the broker’s money. However, once you have established an account, you can invest your own money and start trading in the forex market.

2. In order to become a successful trader, you will need to adapt your own trading strategy. There is no particular approach or strategy that will work for everyone, each individual trader will need to build up their own strategy to the market. While some traders may relay exclusively on technical analysis, others may prefer a more fundamental analysis, and some thriving traders use a combination of both. Each individual trader will need to learn the best strategy that works for them in order to gain a wide-ranging overview of the forex market so as to get ready for any entry and exit points.

3. It is important for you to know that prices move go with trends. Forex has a popular saying, “The trend is your friend.” there are some trend movements that have been studied over many years in order to spot patterns in the trend. These trends need to be understood in order to recognize a good trading strategy. For mini accounts that are $25,000 and under, trading with the help of trend analysis may help improve your odds when compared to bi-directional trading. Most new investors will try trading in any direction, when they should be trading with a trend.

4. Before you take any position, take a look at the top five currencies to make sure you’re not missing out on something. The top five currencies used for trading on the Forex are: USD/Yen, Swiss franc/USD, Euro/Yen, Euro/USD and Pound/USD.

5. For new investors it would be advisable to have two accounts because you tend to learn and come to understand the market as you play the trading game. You should have one real account, one that you will in fact use to trade real money; and the second account should be a demo account, one that you can use to test drive alternative moves in the trading game before using your real account. You can effortlessly use your demo account to shadow the trades in your real account so you can widen your stops to see how you are doing and change your strategies accordingly.

6. Always check up the one hour, four hour and daily charts trends that affect your trades. Though you may wish to trade at 15 and 30 minute time intervals, it all up to you and how much you can cope.