Forex or foreign exchange trading implies buying and selling foreign currencies in international market.
A trader in currencies will analyze and trade particular pair of currencies for profits.
Such decisions are based on the follow-ups of events, studying charts, following the market indices in different regions, international trading market and closely watching policies of the central banks in different countries.
One can use manual or automatic trade strategies to understand the working of forex market.
The former requires the traders to make analysis on their own, while the later uses software to read the market trends, analyze them and help in making decisions.
Trading in the forex market essentially means swapping currency.
One needs to gain expertise to know exactly when to buy or sell to make good profits.
Two trading practices commonly adopted are; long and short position.
In the former, the currency is purchased at a lower price and sold when the price appreciates.
In the later, the currency is sold at a price and purchased later only when the price is lesser than that at the time of selling.
One can trade through companies in forex.
But it is advisable to learn the jargons and indulge in 'virtual trading' to clearly understand the working.
Read charts, indices, magazines and financial news and trade virtually after evolving one's own strategies.
Once profits are realized or the investments chosen seem to grow, then invest real money in the market.
Trade a currency after analyzing its history, past fluctuations, present trend, advice from experts if required and market updates.
Invest only to the extent that a financial loss can be handled.