Forex Trading For Beginners
Successful forex trading requires that you exercise patience. Also, learn to control the greed to get rich quickly and the anger to win back lost trades.

Forex Trading For Beginners 101; Step by Step Guide To Earn Six-Figure

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The ultimate forex trading for beginners guide is a must-read…

Did you know that you can make money trading forex? Forex has made many people millionaires and that is a fact. However, the other side of the coin stinks. I won’t like you to take the taste of the coin when flipped and so I have prepared a forex trading for beginners guide with all the things you need to know before you start trading forex.

Are you ready to learn forex trading step by step? Let us get started in this way…

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At the end of this post, I will link you up to an online forex academy where you will be trained live with a personal mentor who does Forex trading as a full-time job. So ensure you read the post to the end.

“Forex” stands for foreign exchange and refers to the buying or selling of one currency in exchange for another. I will give the two major forms of trades from which you can choose to make money.

Forex trading for beginners – the main form of forex trading

There are two forms of forex trading that you may get interested in. It is good to know how each works just before you set your foot into it. I will go ahead and list the two:

1. Spot Forex

buy low sell high
Photo by Blazona

This form of Forex trading involves buying and selling the real currency. For example, you can buy a certain amount of pound sterling and exchange it for euros, and then once the value of the pound increases, you can exchange your euros for pounds again, receiving more money compared to what you originally spent on the purchase – well known as the stock exchange.

2. CFDs

CFDs
Photo by Blazona

The other form of forex trade is CFDs. The term CFD stands for “Contract for Difference”. It is a contract used to represent the movement in the prices of financial instruments. In Forex terms, this means that instead of buying and selling large amounts of currency, you can take advantage of price movements without having to own the asset itself.

These price movements are represented in form of charts that the trader is to interpret based on acquired skill – whether or not the price will move higher than now after a specific time duration.

Along with Forex, CFDs are also available in stocks, indices, bonds, commodities, and cryptocurrencies. In all cases, they allow you to trade in the price movements of these instruments without having to buy them.

Please note: in this forex trade101 and the OJIK blog, we use forex trade in reference to this form (CFDs) of trading forex.

Types of trades in CFDs

Once you start trading in CFDs, Forex brokers provide two ways for you to make money trading Forex. These include:

  1. Fixed Time Trades (FTT): These types of trades are quite risk trading, however, they are highly profitable. You can make up to 92% profit from a single trade. When trading forex in FTTs, you are speculating that a particular asset will move up or down after a specific time.

Forex: In this form of trading, you will still speculate the movement in the price of given assets. Unlike FTTs, in Forex you will forecast that either the price of a particular asset

  1. will move up or down to a specific level. Though the profits in this kind of trades usually are lower than in FTTs, we find Forex to be safer to trade.

Forex trading for beginners – Why Do you Need to Trade Forex?

Once you become a trader, the forex market offers you a chance to analyze and make choices on movements in foreign exchange markets and particular economies or regions. You then can enjoy the profits out of correct analysis and choices made during the trade sessions.

Below are even more reasons why you should start trading forex:

Liquidity – In the 2021 forex market, the average volume traded per day is over $6,6 trillion. So, there is an abundance of trades and moves you can make.

Diversity – Firstly, you have the pairs stemming from the eight major global currencies. On top of that, many regional currency pairings are also available for trade. More options, more opportunities to turn a profit.

Accessibility – While not quite 24/7, the forex market is readily accessible, open twenty-four hours a day, five days a week. As a result, you decide when to trade and how to trade.

Leverage – A significant amount of forex currency pairings are traded on margin. This is because leverage can be used to help you both buy and sell large quantities of currency. The greater the quantity, the greater the potential profit – or loss.

Low commissions – Forex offers relatively low costs and fees compared to other markets. In fact, some firms don’t charge any commission at all, you pay just the bid/ask spreads. True ECN firms may also offer 0 spread.

Forex trading for beginners – What do you need to start trading forex?

forex abc
Photo by Blazona

In this forex trade101, we also got a list of what you need in order to get started, you will need to put them together. I will help you do this the right way just to ensure that you maximize profits. Let us jump into this right away…

(a) Computer with an internet connection

A mobile phone can be a good medium for you to trade forex however, I would recommend that you get yourself a computer for this task. It is worth it.

(b) Acquire the trading skill

forex skills
Photo by Blazona

It is good mentioning that Forex trading isn’t a lifestyle. Neither is it a get-rich-quick scheme. But It is an art that you ought to learn. This includes learning to interpret chart patterns and deriving points you can enter or exit a trade.

Talking of entry and exit points in a trade; Forex entry points are the levels or prices or points at which you choose to open a trade, and this applies to both selling and buying. on the other hand, the exit point is the point at which the trade will close.

These two points are what really determine whether or not your trade will give you an income profit or a loss. 

Making objective rules for yourself during trades is very important in helping you avoid false entry points in a trade. You also ought to learn how to handle the fear to lose and the greed to get rich quickly.

Most beginners lack this knowledge and so they end up gambling in trades. They lose tones of cash and then spread the wrong gospel out there saying forex is a gamble.

But no, Forex is not a gamble but a business. There is nothing fancy about forex. It is just a business like any other. It needs time to learn and practice as much as possible to make it a success.

 (c) Open a trading account with a CFD broker 

This is what gives you access to the platform on which you can trade various currencies. Many beginners get caught up in the search for legit brokerage firms only to end up in hungry scammers’ hands. But don’t mind. As a reader at Online Jobs In Kenya (OJIK), you are in safe hands. We only recommend to you what our editorial team has used, tested, and found legit to use or invest in.

Talking of trading platforms and brokers you must be asking which ones are these huh! I will first explain the Brokerage firms and then get to platforms.

Best forex trading platform for beginners

When looking for a Forex trading broker you will bump into long lists on the internet that could even confuse you more. Or by chance, you could fall prey to scammers who may convince you to send them money so that they can trade on your behalf.

You Ought to know that as said earlier, Forex trading is an art that you ought to learn. It can’t be borrowed. Neither do we have shortcuts to successful forex trading. Do not fall for the hype of ‘send me your account details I trade on your behalf.’ It just doesn’t work that way. Those individuals are commonly mistaken to be brokers when in the real sense they are scammers.

No successful trader will allow himself the temptation of trading for another because they understand the principles of forex trading. The best they do is to offer mentorship and coaching for you to become an independent trader – That is the exact thing that OJIK does.

We share our expertise with you so to empower you fully as a trader among other money-making opportunities shared on this blog.

With that said, let me show you our top pick on legit forex brokers:

1. Olymptrade

olymptrade

The broker has been around since 2014 and has steadily grown in popularity among traders since then. It is one of our favorites at OJIK as highly recommended by our founder Ezekiel W.

Olymptrade is such a secured and reliable forex trading broker that any beginner can jump on to and start trading almost immediately.  You get access to a large number of training and educational materials. The training and helpful resources are open to all members of this broker.

You also get access to a demo account with 10,000 virtual funds to help you practice and fine-tune your trading skills.

To start trading and make real money trading forex, you need to deposit at least $10. Use skrill to make your deposits as it is such a convenient mode of payment and creating an account is free. 

You make 82% from a successful trade as a standard investor and 90% as a VIP investor. To become a VIP you need to make a deposit of at least $2,000 (ksh 200,000)

However, as a beginner, I recommend that you deposit at least $50 on your live account to start trading. You get a bonus if you use the link below to create a free account and make the top-up to your account.

→ Create a free Olymptrade account ←

2. FX Pesa

fxpesa

FXPesa is another of our favorite forex trading brokers. Launched in May 2019, FXPesa became Kenya’s First authorized and regulated Non-Dealing Online Forex Broker. It is run by EGM Securities licensed by the Capital Markets Authority Kenya under license number 107.

Since FXPesa is based in Kenya, I would give it a thumbs up for considering incorporating almost all digital payment methods available in Kenya. The likes of Mpesa, Airtel money, visa, and master card. but also a great thanks to its support for Skrill and Netteller.

If you are into an online business then why not go for skrill which directly connects to both your MPesa and bank for convenient trading transactions. You can click here to create a Free account at skrill. 

Just like most brokers, FXPesa has detailed training tutorials for newbies and access to a demo account with virtual funds.

Though FX offers a $5 minimum deposit for executive accounts and a $100 minimum deposit for premier accounts. You don’t want to deposit $5 on any forex trading platform unless you are just testing waters.

Our minimum recommended amount is a $50 deposit and get a welcome new member bonus added to your account.

Demo account to train on: → Create an FXPesa demo account ←

Live account to make money on: → Create a Free FXPesa Live account ←

3. eToro 

etoro

eToro is a well-known Israeli fintech company, a social trading broker, established in 2007.

eToro serves UK clients through a unit regulated by the Financial Conduct Authority (FCA) and Australians through an Australian Securities and Investment Commission (ASIC) regulated entity. All other customers are served by a Cypriot unit that is regulated by the Cyprus Securities and Exchange Commission (CySEC).

The broker supports most payment methods accepted globally i.e PayPal, Skrill, Neteller, and iDEAL

It also got voluminous training materials which you can access through the trading Academy. In this academy, the Broker offers learning content that you can access through Live Webinars, eCourses, and trading Videos

Minimum deposits for live accounts vary from country to country.

→ Create a Free eToro account ←

4. IQ Options

iq options

IQ Option has been operating since 2014 and has seen noticeable growth over the period. It now supports over 500+ assets that traders can trade in personal accounts.

This broker has almost everything that looks like Olymptrade. In fact, you could think that IQ Option is the immediate baby sister to Olymptrade.

From our experience, the IQ Option trading platform is one of the best-programmed software for traders. IQ Option is continuously adding new features to the software and tries to improve the trading experience of the customers.

→ Create a Free IQ Options account ←

With the brokers’ list at hand, Now we can talk about forex trading platforms right away.

(d) Forex trading for beginners – Brokers’ trading platforms 

There are two international platforms where all traders can gain access and make transactions. These two are Metatrader4 (MT4) and Metatrader5 (MT5)

MT4 and MT5 platforms were developed by MetaQuotes in 2005 and 2010 respectively. Although they are most commonly associated with forex trading, MetaTrader 4 & 5 can be used to trade a range of markets including forex, indices, cryptocurrencies, and commodities, via CFDs.

MT4 is extremely popular due to the fact that it is highly customizable to your individual trading preferences. It can also be used to automate your trading, using algorithms that open and close trades on your behalf according to a list of set parameters.

To trade forex on MT4 or MT5, you need to have an account with either of the earlier mentioned brokers. And then also create an account with MT4 or MT5. It is the broker that will link your accounts to give you leeway to trading.

However, as a beginner, you may not need to have an MT4 or an MT5 account. You may still trade on a live account using the brokers’ trading platform provided on the web or a downloadable mobile app.

Due to the learning curve in using MT4 and MT5, most brokers provide their own trading platforms for their users. However, as you advance in skill, you may opt to migrate to the MT4/ MT5 platforms.

(e) choose an asset you would like to trade

Once you have set up your account with any of the brokers we have recommended to you. Log in to the account and find a suitable asset to trade. You may choose to trade either a pair of currency i.e EUR/USD, GBP/USD, USD/JPY or you may work with commodities such as gold and petroleum.

We advise that you trade where banks are also trading and avoid trades that governments are investing in such as tesla.

(f) decide whether you think that the asset’s price will go up or down.

Finally on forex trade101, after you have made practice and fine-tuned your trading skills, make a deposit to your account and start trading. We recommend you deposit a minimum of $50 so that this can sustain and balance your account.

When trading, make trades worth 5% to 10% of your account total. Avoid the temptation of putting your whole account balance in a single trade – That is what we call greed. it could cost you losses.

Overall rating of best forex broker for beginners

1. Olymptrade

Rating: 5 out of 5.

This is the best overall forex trade broker that we recommend to our readers. Creating your account you get access to smart tools including trade signal advisors and fast real-time customer support.

→ Click here to create Your free Olymptrade account ←

 

2. FXPesa 

Rating: 4.5 out of 5.

This is the most popular local broker in East Africa. It obviously isn’t popular for nothing. If you are within Kenya and you don’t have a master card or visa to link to a skrill account, then Fxpesa can be handy since you can transact using mobile money transfer services ie M-Pesa, and airtel money.

→ Click here to create Your free FXpesa account ←

 

3. eToro

Rating: 4.5 out of 5.

eToro is a perfect broker for high-end investors that are quite experienced and know exactly what they ought to do. Its live customer support varies from country to country however, we still find it to be such a safe broker to trade with based on our experience with them.

→ Click here to create Your free eToro account ←

4. IQ Option

Rating: 4.5 out of 5.

IQ Option is a good alternative to Olymptrade however it got lesser assets to trade compared to the latter.

→ Click here to create Your free IQ Options account ←

 

NB: In order to safely transact with the above-named brokers conveniently, We recommend that you sign up for a skrill account. That is the account we use and we can confidently advise that you also use it when dealing with forex brokers.

→ Click here to create Your free Skrill account ←

Final thoughts to our forex trading for beginners guide

As we finish up on this tutorial trading forex resource this is what we got for you. Forex trading is an art that you acquire with time. Getting yourself a coach or mentor could quicken the learning curve. We only support two brokers for mentorship.

If you want a personal mentor who will coach you in real-time live sessions then you will need to do the following first:

Alternatively, if you prefer FX Pesa, then click here. Also remember to create a metatrader 4 account.

However, you still could get committed and learn by yourself as you practice using internet resources such as blog posts and youtube video guides. Gather as much information as you can about forex even as you trade.

The plain truth is that as much as traders make millions trading, you never get to become a millionaire overnight. There is always a growth period and that is what many beginning traders fail to honor.

But think of this, Doctors are paid decently. but for you to become one you got to meet some standards apart from spending whopping 6+ years in the university for a mere degree in medicine.

Just start to become great, You don’t wait to become great to start…

Accept to be a beginner and take forex for beginners lessons seriously. You just need to spare two months and study forex. The first three weeks can help you understand every theory concept you need to know in forex and then spare the last  5 weeks on the demo account.

Come up with personal trading strategies and objective principles to which you should stick to always. Learn which assets are worth trading when? Get your to-do list and gather forex trading tips just before you switch to a live account.

This is all you need to know just before you start trading forex. This forex trade101 explainer is updated frequently to add fresh content always for beginners like you. Keep checking back for more juicy updates to help you learn forex trading.

Risk warning:

Trading Forex or CFDs (contracts for difference) on margin carries a high level of risk and may not be suitable for all investors. There is a possibility that you may sustain a loss equal to or greater than your entire investment. Therefore, you should not invest or risk money that you cannot afford to lose.

Forex for dummies or forex trading for dummies is trading on demo accounts with unreal funds. in this case, you do not make any money until you have deposited funds into your broker’s acount.

Did you like our forex trading for beginners guide? If yes, show us some love and support by sharing this forex trading for beginners guide with friends on social media as much as you can. You will also benefit them in a way. Also, drop your comments below so we can help/ adjust where necessary.

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