Forex Trading Signals [Profitable In 2020]
Forex signal is a forecast of a provider about entering a trade on a certain currency pair at a setted time and price.
Free Forex signals are free forecasts of a trader about starting a trade on a currency pair, usually made at a certain time and price.
Forex, the abridged version of Foreign Exchange, is nothing but a currency exchange where you can sell Forex signals. The forex market is, first of all, an international currency market – the biggest and the most active financial platform in the world.
Just imagine:
Its daily turnover exceeds $5 trillion!
This is more than the turnover of all national stock markets together!
Who Participate?
Forex Trader is a person who trades, buys or sells currency on Forex.
Participants of the Forex market are the biggest banks and central banks of various countries, investment and pension funds, big companies and private investors with huge personal capital, so Forex signals are absolutely legal.
Deals in this market start at $1 million!
However, this is also a market, where instead of buying or selling real currency, a forex trader makes bets on rising or falling of the exchange rates.
The whole point is that a person is trying to predict what will happen to the exchange rate of one currency against another, and makes a deal with the forex dealer. If his prognosis comes true, he earns – the dealer pays him. If not, the dealer debits a certain amount from his account.
Do I Need a Lot of Money to Start Trading?
To start trading there is no need to have lots of money or certain equipment!
You just need to have Internet access and a trading terminal - a special program on the computer. At the moment you can even find mobile applications for accessing the market.
However, this doesn’t mean that earning on Forex is easy!
Actually, the risks are sky-high.
But before we start familiarizing with the best forex signals 2020 and sessions, let us discuss the basic concepts you will face when encountering the market.
Even experienced traders won’t do without theoretical information, so we don’t recommend skipping those sections.
Bid & Ask
Do you remember how moneychangers always set the difference between the purchase and sale price to make profits?
The same approach is used today.
That is why the daily fx market has two prices – bid - the purchase price of a currency from a trader, and ask - currency sale price to the trader.
The distance between the bid and ask prices is called the spread. It is the spread that makes the profit of the dealing center.
Pip
Pip is another important term in Fx live trading.
It defines the smallest value of the currency movement that can be measured.
For example, if the USD value increases by a pip it means that it has increased by $0,0001.
Margin Trading
Dealing centers are not charitable institutions that is why when a forex trader completes a deal, they take a guarantee by freezing a part of the funds on a deposit.
This guarantee is called a margin.
When a trader is conducting a transaction, he receives a larger amount than he actually invests, i.e. a person gets a sort of a loan.
That is how financial markets work.
The ratio between the margin and the received amount is called leverage.
Some dealing centers provide an opportunity of trading with big leverages.
Unfortunately, when accepting such terms, beginners think only about big profits from positive deals forgetting that during the negative transaction losses increase in the same proportion.
As a rule, this leads to a fast loss of the deposit…
If you are not sure whether you can cope with trading on your own, we recommend paying attention to Forex signals.
Often they are free to use and turning to professional best Forex signals review may greatly help you to save money and nerves.
Margin Call
The dealing center attentively follows margin call trader activity. It doesn’t want to sue the trader if his losses are higher than the available deposit. The mechanism of controlling the current trader’s losses is rather simple:
Thus, a margin call is a financial security demand for the current margin.
Sounds too boring or complicated?
We agree, but it is impossible to understand the basics of trading and to become an expert without familiarizing with them.
The only simpler way is to follow free forex signals Telegram groups and to obtain processed and already analyzed information from experts.
However, there are many Forex signals providers, so be attentive when choosing one.
Currency Pair
If you look at forex trading signals or on the exchange rate of the platform, you’ll see that it always consists of two currencies.
They are called the currency pair, one of which is the base currency and another one – the quoted.
Forex Market Features
Forex prices are formed based on the agreement of bidders depending on supply and demand for a particular currency.
This international platform possesses a variety of features but we will name only a few of them:
Functionality
The initial goal of creating the market is currency exchange.
Market relationships allow conducting the exchange at a favorable course that is suitable for all the participants.
Subsequently, Forex live traders started using this platform for making profits. Central banks of different countries make Forex financial interventions aiming to stabilize exchange rates of their national monetary units.
You Can Trade Anywhere
Do you know why we like this market so much?
You can receive the best Forex signals 2020 and trade on the platform not depending on where you are!
Amazing, right?
Just make sure that your internet connection is good.
Diversity of Participants
Here you can meet majorities (central banks, big commercial and investment organizations), different trading enterprises, and of course individual players.
Don’t worry, you won’t be the only forex trader out there.
However, everything becomes more challenging for smaller players, so we highly recommend using the best Forex signals Telegram groups as an additional source of information.
Trading Sessions - When Is It Better to Trade on Forex?
To become a successful Forex trader you need to keep in mind a plethora of things – how to trade or when to refrain from concluding a deal.
You should also learn how to obtain the best Forex signals 2020 and to benefit from them.
But apart from receiving signals and learning all the definitions by heart, you should know the opening and closing time of the stock market, Forex working hours, and on what days or even months it is more beneficial to trade.
So when does the Forex operate?
It is open 24 hours a day five days a week.
We have made a brief overview of four different markets to help you maximize profits (keep in mind that the hours are indicated in Eastern Standard Time):
It occupies the second place in the world among Forex platforms and is attentively followed by investors because the USD is involved in over 90% of all the transactions based on the Day Trading the Currency Markets by Kathy Lien published in 2005.
NYSE or New York Stock Exchange immediately influences the dollar, which may lose or gain value in a matter of seconds when enterprises buy each other or merge.
It is the first trading center that was established in Asia and holds the biggest share of the Asian trading ahead of Singapore and Hong Kong.
The most popular currency pairs include USD/JPY, GBP/JPY, and GBP/CHF. It is especially great to follow USD/JPY when Tokyo is the only operating market because the Bank of Japan has a huge impact on the market.
The trading day usually starts in Sydney.
Even though it is the smallest among the four markets, a lot of things happen here when they open on Sunday afternoon and financial institutions together with traders regroup after a break since Friday afternoon.
The UK occupies leading positions on a global currency market, and London is the main reason why.
London greatly influences currency fluctuations.
This takes place because the Bank of England, which controls the GBP monetary policy and indicated interest rates, has headquarters in London.
By the way, Forex trends also originate from London.
Write this down and rank even higher than finding the best Forex signals Telegram group:
This leads to higher price ranges and additional opportunities.
So What Is The Best Time?
Let us introduce you to the three daily overlaps:
Over 70% of all trades take place when these two markets overlap because Euro and USD are the two most popular currencies.
Choose this timeframe because of high volatility.
This period is not so volatile but still gives traders a chance to make profits. Pay attention to the EUR/JPY pair.
This is the weakest period in terms of activity among all the three pairs.
Traders from the US will be still sleeping and only an hour doesn’t give much space to wait till new trends and fluctuations take place.
It is great that nowadays Forex trading signals take all these overlaps into account, so you can choose the market and the pair knowing peculiarities of each of them.
However, choosing a reliable Forex signals provider takes time and you need to approach the task with maximum attention.
How Are Deals On The Forex Market Made?
Now, when you have the necessary theoretical knowledge and can distinguish pip from a bid, and distinguish good Forex trading signals providers from scammers, let us discuss how everything works on the Forex live market.
Before the trade, you choose two different currencies – a trading pair.
As you already know, one of them is the base one, and the other – quoted.
Your task is: to try and make a prognosis of how the rate of the quoted currency will change in relation to the base one.
If you are sure that the rate of quoted currency will increase it is necessary to open the ‘purchase’ deal. If you think that it will fall, open the ‘sale’ deal.
This is the main feature that signals concentrate on: you get a description of the latest fluctuations and advise whether it is favorable to open a trade.
Even though free forex trading signals differ from paid ones, they are also a good source of additional information.
In most cases, USD is chosen as the base currency, while the quoted one can be any other currency.
Let’s have a look at the example. You have chosen the EUR and USD, where USD is the base currency and EUR – the quoted one.
You expect the Euro to rise against the US dollar. At the moment Euro costs $1,115.
You open a ‘purchase’ deal of a $100 value.
In reality, the Euro doesn’t land in your bank account but is still reflected in the internal register of your transactions and on your program balance.
But if the rate drops to $1,095, your losses will equal $ (1,115 – 1,015) x 100 = $10. This money the forex dealer will debit from your bank account. Keep in mind that the dealer also takes a fee for his services.
If these calculations sound too complex, we recommend choosing a reputable service with an opportunity to buy Forex signals because they often come with technical analysis and detailed explanations.
I Want to Trade Forex - What Should I Keep in Mind?
Every aspiring Forex trader faces multiple questions and worries.
Will I be able to make the right decision?
Can I find reliable trading signals?
Will I have enough funds?
Don’t worry!
Thousands of beginners feel the same way but with our basic set of rules, you will always remain on the safe side.
During the day the difference usually equals one hundredths of a percent, so if you are making deals solely on the amount of your deposit it won’t be easy to make a fortune.
That is why users usually trade Forex with leverage.
This means that a Forex dealer can give you a virtual equivalent of a loan. You won’t receive real money but the leverage will allow increasing the sum of the deal multiple times.
And you won’t have to limit yourself only with the money you have on the account.
Remember that you can lose this money any time: it is impossible to make profits every time and losses are inevitable.
But Forex dealers won’t allow you to lose more than you have on the deposit – he will close the deal forcibly.
Forex programs usually allow limiting transaction losses.
Such an option is called stop-loss.
You should use this feature if you don’t want to lose your deposit at once. Stop-loss allows closing the deal automatically when the losses will reach the limit you have set.
Where to Start?
If you want to become a Forex trader follow our step-by-step guide:
Luckily, there is plenty of data on the Internet on Forex and its background.
That is why we have focused our attention on the basis for future traders.
Dealing with a professional broker means a difference between making profits from the trades and losing funds between the bid and ask prices.
Devote enough time to research and read feedback on several brokerage companies.
To make money on trading currencies you need to predict how the world economy will behave.
To gain profit, you need to convert the base currency into a quote one when it’s set to increase in value and then convert the quote currency into the base one when the value reaches its peak.
To get a better understanding of which currencies should be purchased and which of them are worth your investment, it is important to analyze GDPs, trading positions, and even the political situation of the countries you are interested in.
Luckily, this data is often supplied together with Forex trading signals.
If it is your first trade we recommend opening a demo account.
By using virtual funds a beginner will be able to choose the most suitable trading assets, as well as to develop and test his trading strategy.
These skills can later be tested on a cent account. This is already a real-money trading but with minimal risks. Later, when a certain experience is obtained, you can proceed with using a real dollar account.
Final Thoughts
Forex exchange is one of the most popular and definitely the biggest platform for trading currencies.
It engages four major centers in London, New York, Tokyo, and Sydney, and allows thousands of hundreds of traders from all parts of the world to make profits simply by collecting and processing information from the financial and political world.
However, high volatility means risks and you need to approach trading with all the seriousness: don’t use a large leverage, limit the deposit, and use a stop-loss not to lose a fortune.
We also recommend using Forex signals from reputable experts because they are always a great source of fresh and crispy information from the trading world.
Familiarize with Forex trading signals, deal only with reliable brokers, follow the news, and you will master Forex trading with ease.
Forex signals are reliable in the case you do everything right and choose a good signals provider.
And Safetrading will always help you with that!