The forex market happens to be one of the most lucrative places to go to if one is a risk taker and does not mind some losses. Of course, it is not easy to learn to trade forex England as it requires a very good understanding of the market as well as how to read the charts and ride along with certain trends. However, if one still wants to persist and make money through this way, then he should at least know the basics.
When one starts to learn foreign exchange trading, the first thing that one has to know about would be the chart. Now, most people would make use of the candlestick chart since this is the chart that allows one to see the exact movement of the price. As long as one knows how to read a candlestick chart, then he will have no problem understanding the price movement of a currency pair.
When one would try to read a candlestick chart, then he has to make sure he understands two things which are the candles in it. The first candle to take note of is the white or green one which is known as the bullish candle and indicates that the price is going higher. The second candle is a black or red one, known as the bearish candle and indicates that the price is going down.
Once one already knows how to read the candlestick chart, then he has to understand how support and resistance zones work. To make it simple, support and resistance zones are simply zones where the price bounced and made some sort of peak shape in the graph. These zones can help one determine whether there is a trend change or a trend continuation in the price.
Just to give an idea, a support level is basically the price level where a downward peak formed. If ever the price level breaks that level, then there is most likely a continuous trend downward that will keep on going down. The resistance level is the opposite of a support level wherein it is a price level where an upper peak is formed and if the price breaks the level it will indicate an upward trend.
Now that one knows the basic concepts of trading, one has to know some basic patterns to know if the market is going up or down. The most basic one is through the M and W patterns. Basically, one has to look for an M and W in the chart and trade based on that.
If one sees an M, it means that the market is bearish or going down and will continue to go down. If the graph forms a W, then it means the graph will continue going up in that motion. This is the general rule but there are some exceptions to the rule which one will learn as he goes along.
For those who want to learn how to trade in the foreign exchange market, these are the basics to know. Of course, these things are only the tip of the iceberg. There are so many more things that one will have to learn along the way if he will become a successful trader.
When one starts to learn foreign exchange trading, the first thing that one has to know about would be the chart. Now, most people would make use of the candlestick chart since this is the chart that allows one to see the exact movement of the price. As long as one knows how to read a candlestick chart, then he will have no problem understanding the price movement of a currency pair.
When one would try to read a candlestick chart, then he has to make sure he understands two things which are the candles in it. The first candle to take note of is the white or green one which is known as the bullish candle and indicates that the price is going higher. The second candle is a black or red one, known as the bearish candle and indicates that the price is going down.
Once one already knows how to read the candlestick chart, then he has to understand how support and resistance zones work. To make it simple, support and resistance zones are simply zones where the price bounced and made some sort of peak shape in the graph. These zones can help one determine whether there is a trend change or a trend continuation in the price.
Just to give an idea, a support level is basically the price level where a downward peak formed. If ever the price level breaks that level, then there is most likely a continuous trend downward that will keep on going down. The resistance level is the opposite of a support level wherein it is a price level where an upper peak is formed and if the price breaks the level it will indicate an upward trend.
Now that one knows the basic concepts of trading, one has to know some basic patterns to know if the market is going up or down. The most basic one is through the M and W patterns. Basically, one has to look for an M and W in the chart and trade based on that.
If one sees an M, it means that the market is bearish or going down and will continue to go down. If the graph forms a W, then it means the graph will continue going up in that motion. This is the general rule but there are some exceptions to the rule which one will learn as he goes along.
For those who want to learn how to trade in the foreign exchange market, these are the basics to know. Of course, these things are only the tip of the iceberg. There are so many more things that one will have to learn along the way if he will become a successful trader.
About the Author:
To learn to trade forex England trading experts are the best people to turn to. Find out more by visiting http://www.elizathetrader.com/learn-trade-forex.
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