Welcome back forex education and let’s get familiar with what you should expect when you get into the Kindergarten level of your journey to the foreign exchange market. In this level, you should expect some new things as we make our way to your graduation.
So, here are the topics you will start with:
- Brokers 101
- Three types of analysis
- Types of charts
Under these topics, you will find details of what the level entails.
Let’s take a sneak preview into it.
Under this section, these are the subtopics you will be taken through:
1. History of Retail Forex Trading
From the previous content, you must now know that we would not have regular people like yourself and anyone with a working knowledge of forex, participating in online trading in the forex market, if it were not for the internet.
The history covers everything from the regulations that govern currency trading and how the forex market works. These will include government agencies, the Commodity Futures Modernization Act and Commodity Exchange Act; both of which are ways that helped make the forex market accessible to more than just large corporations and hedge funds.
This section breaks down all you need to know about how to trade forex in an accessible world of online trading.
2. Forex Broker Types: Dealing Desk and No Dealing Desk
As a potential trader in the forex market, you must have the best forex broker. How do you get one? What should you know about the different kinds of brokers that exist? There are two kinds of brokers. The lesson will let you know who they are and what to expect from the best brokerage accounts.
The following terms will be defined:
- STP (Straight through market)
- ECN+STP (Electronic communication network + Straight through processing)
This is a module that contains all the things that you need to know about how the ECN brokers operate with the other participants in the market. These brokers will let you as the trader know what the real scenario is and what you can do in your online trading.
3. Dealing Desk vs. No Dealing Desk Brokers
The difference between forex brokers and other brokers is the way that they advertise and the nature of the job. It is not about a broker being better than other brokers but about the kind of service that they offer.
The way to choose the best brokerage account and the best forex broker, is to determine whether you are looking for a quicker and tighter spread with small commissions per trade or go for the long game that takes time with broader spreads and no commissions.
Learn which one works for you, during the lesson.
Some may be evil but it is not hard to find one that you can work with easily.
4. What is a Spread in Forex Trading?
There are two ways for a forex broker to earn commissions. One is by commissions and another is by spreads. So, what is the spread? In simple terms, when you want to trade, the brokers will quote two prices for the currency pair.
One of them is called the ‘Ask’ price and the other is called a ‘Bid’ price. The difference between these two prices is what we call the spread. Take the course to find out what they are all about and how you can use them to benefit yourself from the trades and pay the broker.
5. 6 Crucial Things to Consider When Choosing a Forex Broker
If you want to choose a forex broker, there are many important things to keep in mind. Just for a recap, here they are:
- Customer support
In the market there are so many brokers. You will find it easier to get the right one when you know what to look for. You will find it hard to make anything happen when you can. This is the section of the Kindergarten course where you learn what to look at before you can pick the best broker to work with.
6. Beware of Forex Bucket Shops
What are bucket shops? In the world of forex, the business is lucrative because of liquidity and profits. Among the brokers you will meet, most will be working toward the same goal as you. However, some of them are not good people and they operate their own brokerage firms also called bucket shops.
7. How to Protect Yourself from Forex Broker Scams
When you are new and inexperienced, you will need to make sure that you do not get scammed. It is easy to get scammed these days but you can do something about it. You do not have to just sit back and let yourself be taken advantage of.
Learn what legal action you can take using the services of Commodity Futures Trading Commission (CFTC and the National Futures Association (NFA).
8. How To Open a Forex Trading Account
This is the final module in the Brokers 101 part of the lesson. So, how does one open a forex trading account? There are three major things you will learn when you get to this stage;
- Type of account
- Account activation
Find out what the steps entail when you take the course.
The next section after Brokers 101 is the three types of analysis
Three Types of Analysis
Under this, we have two topics:
1. 3 Types of Forex Market Analysis
There is a belief that the forex market provides equal opportunities to everyone to participate. This is true. However, just because you have zeal, doesn’t mean that you can make profits.
Here are three analyses that can help you make a great trade:
- Technical analysis
- Fundamental analysis
- Sentimental analysis
Learn more from the lesson what these topics entail.
2. Which Type of Analysis is Best for Forex Trading?
Learning the types of analysis that you can use when it comes to forex is not enough. You will also need to know which one works best of all. Each of the analysis is important in one aspect of forex trading.
Finding out which ones to uses when you are making a trade can be the difference between you making profits or you failing to make profits. Choosing an analysis depends on the situation.
Next up, you will find the topic covering Types of Charts
Types of Charts
Under this, we have just one topic to cover:
1. 3 Types of Forex Charts and How to Read Them
The forex market trend can be represented using three types of forex charts. These are:
- Line Charts
- Bar Charts
- Candlestick Charts
In the use of software or just raw data being fed to you from the market in real-time, you will encounter any of these charts. Find out what they are and how they work to make sure that no chances pass you.
On that, the Kindergarten lesson ends. Up next we have the Elementary Level.
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What is a Spread in Forex Trading? Forex Broker Types, Forex Broker Scams and How to Open a Forex Trading Account?
Different Types of Forex Market Analysis
3 Types of Forex Charts and How to Read Them