Question 1

What is forex and how does it work?

Accepted Answer

Forex stands for “foreign exchange" and refers to the trading of global currencies. The forex market provides a way for traders to buy and sell different foreign currencies. You can trade U.S. dollars for Euros or Euros for Japanese Yen, for example. As industries, businesses, and manufacturing have become increasingly globalized, so has financial trading. The forex market is the largest in the world, with almost $7 trillion exchanged on a daily basis. Unlike stock and options trading, forex trading does not take place within an actual physical exchange that opens and closes, such as the New York Stock Exchange. Rather, forex trading takes place 24/7 in an over-the-counter, or OTC, market. Traded currencies show up in pairs, such as USD/EUR. Both individual investors and major financial institutions participate in forex trading.

Question 2

Can you get rich by forex trading?

Accepted Answer

While trading forex is accessible, it isn’t a get-rich-quick scheme. It’s a great way to expand your stock portfolio and benefit from the global markets. Proper forex education is as important to beginners as it is to market veterans because the software and tools are constantly evolving. Still, with the best skillset and tools at your fingertips, there is plenty of opportunity for both novice and veteran forex traders to profit and achieve their financial goals. For those ready to enter the forex market, Udemy’s instructors will prepare you with the skills and knowledge.

Question 3

Can I teach myself to trade forex?

Accepted Answer

It is absolutely possible to teach yourself how to trade forex, but it's important to learn the basics before entering the market. New traders will benefit from understanding global markets and how events impact currency fluctuations. You'll also want to learn how to analyze the international markets and use the ever-evolving trading technology available to today’s forex traders. Staying up-to-date on the latest financial trading news is another great way to become acclimated to the subject. Udemy courses are perfect for people with no prior knowledge of financial markets and trading and would like to acquire more information before entering the forex market. For those who already understand the global marketplace enough to start trading, Udemy also offers more advanced courses to enhance your existing forex knowledge. Lessons include succeeding in the dynamic marketplace, selecting the right broker, and finally, entering the market on your own.

Question 4

What is the best way to learn forex trading?

Accepted Answer

The best way to learn about forex trading is by studying the forex market alongside a true, experienced professional who has spent many years participating in the forex market. Experienced forex traders understand that their students are not only looking for a new stream of income but also want to learn the best ways to limit risk in the financial markets. When it comes to learning about the forex market, having access to a veteran trader with proven experience is the greatest asset. Mastering the forex market also requires a strong understanding of the intricacies of trading platforms such as MetaTrader 4. Udemy’s forex trading instructors will provide you with valuable information about different markets and trading styles you will be able to put to use immediately when you’re ready to try your hand at the forex market and make your first trade.

Question 5

What is the difference between technical and fundamental analysis?

Accepted Answer

The basic types of analysis on the forex market are technical analysis and fundamental analysis. Traders use both to predict price movement on the forex market. Many professional traders see technical analysis as “The Art of Trading.” Technical analysis focuses on historical price movement, analyzing current market conditions, and identifying potential market changes. Forex fundamental analysis examines the overall state of the economy, focusing on various factors, including interest rates, employment rate, GDP, international trade, and manufacturing, as well as their relative impact on the value of the national currency they relate to. Fundamental analysis allows you to capture the long-term trend rather than trading short-term and day trading.

Question 6

What is MetaTrader 4 and what is it used for?

Accepted Answer

MetaTrader 4, also known as MT4, is considered the most popular online forex trading platform used by traders worldwide. Developed by MetaQuotes Software Corp., the platform is designed to make trading flexible. It offers strategy implementation and analytical tools such as financial news alerts to help traders prepare for unexpected price fluctuations. The platform can be downloaded free of charge to personal computers and mobile devices. Several Udemy courses provide students with the knowledge required to make the most of MetaTrader 4.

Question 7

What is candlestick trading and how is it used?

Accepted Answer

Japanese candlestick charts, which were invented by rice merchants in Japan many centuries ago, are a way for traders to read currency price movements for a specific period of time. They consist of four levels that make up three parts. Those four levels are high, low, open, and close. All four levels make up three parts of a candlestick: the upper shadow, body, and lower shadow. Traders use the formation of candlesticks to indicate the strength or weakness in the market. The most popular pattern is called a "pin bar." This is a candlestick with a tiny body and a long upper or lower shadow, or "wick.” It indicates a possible reversal point in the market.