The trader must have a solid understanding of how profits and losses are calculated. Currencies are traded in pairs, with changes in exchange rates often referred to in pips, which are the last few decimal places of the quotation. These are then multiplied by the lot size or the number of units that you bought or sold. If the math already sounds complicated, don’t worry because brokers typically provide profit/loss calculators on their platforms or websites that you can easily use.
From there, you can delve into technical indicators to supplement your economic analysis. Most forex platforms offer a wide range of technical indicators you can apply and customize, depending on your trading strategy, on top of regular economic updates that you can use in gauging which currencies are stronger or weaker. These indicators can give you an idea of whether trends are set to continue or reverse or if support and resistance levels might hold or break.
Of course, where there is opportunity, there is also risk. Risks of losing the money you’ve invested into your trading account on each trade. The markets are unpredictable and can move very fast, so it’s important to have a risk management plan in place before depositing any funds or taking any forex trade setups. If it’s your very first foray into trading, we suggest you start with a demo account first to get a feel of its trading platform, understand how orders are executed, and put your trading strategy to the test.