Forex-trader, producer, promoter, PR-manager, speechwriter are the termes signifying the types of activity or professions, that introduced new ideas in our life during the last 15 – 20 years. We heard about many of them, instinctively felt that such types of activity can exist, about others we have known at first. For example, I doubt whether somebody knew who are forex traders in the USSR times. Perhaps, nobody or just few people did, because you could be deportated for so called “curency operations”. Nowadays it is the prestigious, respected and interesting profession, allowing earn good money and feel yourself maximally independent.
The content of the trader’s job in general is the trading of securities: safety stock, loan securities, futures, options and so on. The curency trader’s job lies in a trading of “valuable stocks” – the currency which can be issued only by the goverment. Forex trader works at the particularized international currency market Forex, trading sessions at which are held 24 hours a day, 5 days a week. The essense of the trader’s job is making profit from rate exchange fluctuations. He/she can either buy one currency, for example US dollar at the lowest course, then sell it at the highest course, or make it inside out, that is to sell the currency at the highest course and buy it when the course is decreased.
On the one hand, all happenning at the internstional foreign exchange market is simple. Rates of exchange (eur/usd, eur/gbp, usd/jen) can move just in two directions – up and down. But to guess a trend of the movement is whole science and skill. And if you mistake, you will punished immidiately – you can loss all funds at you deposited and these can be the whole fortune. At that this money could belong to other people. That is why playful moods of people attended at the market in some way are possible, but decisive significance is belong to the activities of the professionals. While taking a decision about market operations, this kind of people bases on their skills, experience and, certainly, special psychological qualities, without which any diploma, even Harvard Diploma, is just clean paper to be hanged on the wall instead of drawing.
Any formal knowledge about currency trading is relative enough. Trading education, of course, increases competence, insure against the row of the evident mistakes, but does not guarantee anything special. Moreover, currency market is served by lots of analytical agencies, giving daily forecasts about “where the trend will go” – today, tomorrow or in the foreseeable future. They do this work on basis of so called fundamental and technical researches, which let to look at the market from macroeconomic positions and from the point of view of the market prices movement, supposing that market has already taken into account everything by itself. So, Forex forecasts of these agencies also do not guarantee much. And they can allow a bug, which can force a trader leave the market one day after being kicked.
Professional trader differs from amateur in that he does not toy with market, but play, in other words, works for winning. That’s is why being inclined to risk, he nevertheless needs to control his actions and make them (open position, close position, set stops) in the basis of rational decisions, deep enough research and understanding of the market. For getting stable profit he/she should have a well though-out system of regulations of behaving at the market. Overincomes are lot of either dilettante who is lucky today and is not tomorrow, or professional of the high level, deeply understanding the market and even having possibilities to influence on it. However, for the overwhelming majority working at Forex there is no any ability to affect the market, and they can earn only when they reckon on fitting into an intense trend appeared at rate exchange and guessed by them. Such is the trading psychology, that trader’s mastery also concludes in his/her indifferent relation to the market. There are no places at Forex for heat, emotions concerning the winnings or defeats, “blind” opening positions, relying on luck. Forex is not a casino and you should work at it with clear mind, nerves of steel and fast hands.
Article was added by Svetlana Milyushko,
News editor of InstaForex