Economy
Insider Secrets of Forex Trading for Newbies
The world of forex has been popularised across the entire world thanks to the major advancements experienced in technology and media.
Although what’s being advertised about trading may seem glamorous and simple, there’s a lot more than what meets the eye.
Most people have a misguided view of forex trading due to a lack of sufficient knowledge on the topic; having said that, many tend to give up as soon as they realize how technical it is.
Even so, with the right attitude and information, anyone can also make a killing through forex trading. For a person to truly master this intricate craft, he or she must first comprehend the fundamentals of the trade. To help you get started, here’s a beginner’s guide to forex trading.
The term forex originates from the phrase “foreign currency exchange” which is the conversion of one currency to another. Therefore, forex trading is the buying and selling of national currencies in a global marketplace.
However, in order to participate in forex trading, you must first seek the services of a forex broker such as hotforex. These are companies that provide traders with a platform for buying and selling foreign currency. Traders on such platforms can be anyone from an individual retail currency trader to financial firms that trade on behalf of clients.
The forex market is quite broad and complicated which can be rather overwhelming for both beginners and seasoned pros. Thus, learning the secrets to the trade is extremely paramount to your success. To help you get started, here are some of the most helpful insider secrets for beginners.
Patience is Paramount
Like every other good thing, success in forex trading isn’t going to come immediately. Many novice traders usually give up after only a few attempts, not knowing that trading isn’t straight forward and requires tons of patience and practice.
It’s important to understand that forex trading is a profession similar to any other one, and requires years of training and experience to fully master and leverage.
Stick To Your Limits
When you’re just starting out in the forex trading game, it’s extremely important to know your limits as a novice trader and stick to them. Every prospective trader should understand that forex trading isn’t a get-rich-quick scheme; just because you can potentially get lots of money doesn’t mean that success is guaranteed.
Having said that, anyone looking to trade should ensure that they’re willing to risk and lose the money they intend to use. This is why this money is referred to as “risk capital”.
For those who are fortunate enough to have funds set aside for trading, it would be wise to ascertain the amount of risk capital you intend to use for each trade. This is where many amateur traders tend to go wrong and end up losing lots of money.
The best thing is to familiarize yourself with leverage ratios and stick to them. Moreover, under any circumstances, never open a position size that is big enough to blow your account.
Learn as Much as Possible
The most powerful tool in the world of forex trading is knowledge. The more you know about this profound topic, the better you’ll become at trading.
Educate yourself about the forex market and ensure you learn about all the currency pairs and what affects their behaviour. Fortunately, there’s an abundance of resources that’s available online; make good use of them before you attempt risking any actual money.
Practice Makes Perfect
Forex trading is a very practical matter that requires a hands-on approach to understand and master. There are several platforms that offer traders demo accounts which simulate the actual forex trading market. This enables prospective traders to test their knowledge in real market conditions without risking any real money.
Making use of such resources will help a trader gain the experience required to trade in the real forex market. Create a trading plan and test it out in one of the many demo platforms to see how effective it is.
Final Remarks
Contrary to what many people may think, forex trading isn’t all fun and games. Due to a lot of regulations in the interbank market, forex trading has become quite complex.
Even so, understanding how leverage works and knowing how to manage risk will go a long way in helping you succeed in forex trading.
By Dipo Olowookere
The decision of investors to book profit after the previous session’s gains pulled back Customs Street by 0.09 per cent on Thursday.
The selling pressure was mainly on BUA Cement, which put the Nigerian Exchange (NGX) Limited off-balance during the session.
Analysis of the trading data showed that the industrial goods sector was the sole decliner, losing 2.85 per cent, as a result of the poor performance of BUA Cement at the market yesterday.
The other key sectors of the bourse were bullish, with the banking space up by 2.87 per cent. The consumer goods index appreciated by 0.30 per cent, the insurance counter improved by 0.16 per cent, and the energy segment rose by 0.08 per cent.
At the close of business, the All-Share Index (ASI) went down by 221.14 points to 242,145.61 points from 242,366.75 points, and the market capitalisation decreased by N32 billion to N156.207 trillion from N156.239 trillion.
Eunisell crashed by 10.00 per cent to N189.00, BUA Cement lost 9.99 per cent to quote at N275.60, CAP declined by 9.61 per cent to N142.45, Royal Exchange slipped by 9.55 per cent to N1.42, and Guinea Insurance tumbled by 5.38 per cent to 88 Kobo.
Conversely, First Holdco soared by 9.96 per cent to N87.25, McNichols gained 8.00 per cent to trade at N5.40, UBA appreciated by 7.93 per cent to N44.25, Veritas Kapital jumped by 6.85 per cent to N1.56, and Jaiz Bank chalked up 4.07 per cent to settle at N8.95.
It was observed that the market breadth index was positive after the exchange closed the session with 22 price losers and 27 price gainers, representing strong investor sentiment.
A total of 498.5 million shares valued at N34.9 billion were traded in 39,484 deals on Thursday, in contrast to the 476.3 million shares worth N29.6 billion transacted in 40,992 deals on Wednesday. This indicated that the trading volume grew by 4.66 per cent, the trading value increased by 17.91 per cent, and the number of deals depreciated by 3.68 per cent.
Japaul ended the day as the busiest equity after trading 77.7 million units for N231.5 million, Access Holdings sold 41.2 million units valued at N1.0 billion, First Holdco exchanged 38.8 million units worth N3.4 billion, UBA transacted 31.5 million units for N1.4 billion, and Fidelity Bank traded 23.8 million units worth N495.0 million.
By Adedapo Adesanya
Oil prices settled about 1 per cent lower on Thursday even as the Iran war escalated, with the Middle East oil producer asking Yemen’s Houthi movement to be prepared to close the Red Sea oil export route.
Brent crude futures fell by 72 cents or about 0.9 per cent to trade at $84.23 a barrel, while the US West Texas Intermediate (WTI) futures depreciated by 65 cents or 0.8 per cent to close at $78.95 a barrel.
Iran has instructed Yemen’s Houthi movement to stand ready to close the Bab el-Mandeb strait, the vital gateway to the Red Sea, if the US follows through on threats to strike Iranian power infrastructure.
Market analysts warned that with the Strait of Hormuz already closed, the latest threat raises the serious risk of both of the Middle East’s primary oil export routes being disrupted at the same time.
About 7.4 million barrels of petroleum transited Bab el-Mandeb per day in June, about 7 per cent of global oil output, according to Kpler data, up from 4.2 million barrels per day last year.
This week, US President Donald Trump repeated oft-stated threats to strike Iranian power plants and bridges.
According to senior Iranian sources, the Islamic Republic’s leadership has discussed the idea with Iran’s Houthi allies, with the rebel forces now awaiting definitive orders to begin targeting maritime traffic.
In a sign of escalating tensions in the region, the Houthis fired missiles at Saudi Arabia after accusing the kingdom of bombing an airport under their control on Monday, breaking a four-year truce in the conflict between the kingdom and the group.
This comes as Saudi Arabia is currently evaluating a massive infrastructure expansion to permanently upgrade the capacity of its western pipeline and terminal networks.
Any additional disruptions could force international shipping firms to redirect vessels around Africa, inflating transit costs and worsening the global energy crisis.
On Wednesday, the US struck Iran’s coastal defences and missile sites after reimposing a naval blockade of its ports, while the two countries exchanged intensified fire on Thursday, which kept pressure on prices upward.
However, weighing on prices was Iran’s release of a US citizen, which could point toward a path to avert the resumption of all-out war.
By Adedapo Adesanya
The Central Bank of Nigeria (CBN) has launched a new digital platform to track every foreign exchange transaction involving Bureaux De Change (BDC) operators, marking a major step in its efforts to improve transparency and strengthen oversight of the country’s retail forex market.
In an operational guidance issued on July 15 to authorised dealer banks and licensed BDCs, the apex bank introduced the FX BDC Purchase Tracker (FXBT), a centralised electronic portal designed to monitor foreign exchange purchases by BDCs from the point of request through approval, settlement and eventual sale.
The CBN said the portal will require BDCs to upload real-time or same-day data on all FX purchases made through the Nigerian Foreign Exchange Market (NFEM), giving the regulator transaction-level visibility across the retail FX market.
According to the bank, the platform is designed to prevent abuse by making it easier to detect operators attempting to exceed the weekly purchase limit of $150,000, obtain allocations from multiple banks or divert foreign exchange outside approved channels.
The launch of the tracker builds on the CBN’s February policy that restored direct access for licensed BDCs to purchase foreign exchange from authorised dealer banks through the NFEM. While that policy improved access to official FX, the new platform provides the digital infrastructure to monitor how the funds are used.
Under the new framework, authorised dealer banks must conduct comprehensive Know-Your-Customer (KYC) and customer due diligence checks before selling foreign exchange to any BDC.
The new guideline also says banks must verify beneficial ownership information, retain incorporation documents and carry out enhanced due diligence for higher-risk operators. Any BDC that fails these checks will not be allowed to access official foreign exchange.
The guidance also requires banks to acknowledge BDC purchase requests submitted through the FXBT portal within two business hours and immediately notify operators whether their requests have been approved or rejected.
To discourage speculation, the CBN directed that any forex purchased through the NFEM but left unused must be sold back into the market within 24 hours after the expiration of the utilisation period. BDCs are also required to disclose any previously unused balances when submitting fresh requests.
In addition, all foreign exchange transactions between banks, BDCs and customers must be settled through registered accounts with licensed financial institutions. Third-party transactions are prohibited, and any transfer outside a BDC’s registered settlement account will be treated as a regulatory violation.
The apex bank also said all authorised dealer banks and licensed BDCs are expected to comply with the new regulatory guidance and operational procedures with immediate effect.
