When people first start to trade they tend to focus on binary options and the reason is simple: they’re a lot of fun. Picking out binary stocks in the morning and watching them go nowhere but up all day really lifts one’s spirits. Sure, “bins” are fun but the way to make real money is Forex or Foreign Exchange where you’re not only trading currencies, in time you’re going to be trading almost everything there is to trade - commodities, CFDs etc.. And let’s make it official: it all starts with
Making a trade
1. Here is the first good news: everything pertaining to online trading platforms such as xStation is cloud based, which to you means speed, real time data flow, full integration of most of the apps and not having to download anything from the Internet. Ever. So, get your training account going on the CurrencyHouse website, log on and let's go.
2. Let's make your first trade. “Making a trade” means you either going to buy something or sell something. Pick a pair (two currencies you want to trade) and start watching the candle chart. It’s as easy as it gets: the solid color candle means that your chosen currency is growing in value, the colorless shape reflect the period of devaluation of that currency. Those time increments vary depending on a platform, usually you’re looking at 5-10-15 etc. minute increments, in which you evaluate the potential of your trade.
3. For now the three most important “buttons” for you, the ever present ones in every platform, in every way of thinking and trading are placing a trade, stop loss/take profit and market order.
If you’re planning on making an account with a $1000 or less or anywhere between, say, $1000-$5000 you should have your lot size around 0,1, which is the smallest lot you can trade for many different indices and instruments. Stick with this trade size until you really learn the ropes.
4. “Going long” on a particular instrument means, given the projected growth of its value in time, you commit to holding it long term. In other words, you buy a bunch of it and don’t short it for a while. “Shorting” means that you predict the loss of value and decide to sell. After you’ve sorted all this, placing a trade as just a click away, after which the system takes over, automatically deducts commissions for the broker, calculates your position in real time, shows you the current profit (it’s going to be negative for a recently opened trade, don’t worry about it just yet) and you’re done for the moment.
“Stop loss” and “take profit” are the two voices in your head that will never cease to annoy, startle and vex you. Unfortunately, you have to listen to them and consult with them constantly. It’s your little pet broker inside the platform who takes orders from you to exit the market at a point when your trade’s either done with and it’s time to cash out, or the market collapses and it’s time to run. The viability of your trades depends on how well you communicate with that little pet broker.
Read also: Managing risks (part 2)