How to trade online

How to trade online
Learn how to trade online with AvaTrade

How to Trade Online

If you are just starting out in the world of online trading, it may feel a bit daunting, But have no fear as AvaTrade are here to support you every step of the way. With us, you will learn that as a trader, you are in control of your own destiny. It’s about how you trade, following your plan, not being led by your emotions and using all the tools are your disposal to enhance your trading potential.

The very root of trading for a beginner starts with a clear understanding of the basic factors that influence market behaviour, and the forces of supply and demand. When supply and demand are not in sync this is when a price move is going to happen, if there are more willing buyers than there are sellers in the market, then a price will go up and vice versa. This logic is simple and applies to the principles of trading currencies, CFDs, on Stocks and investing in general.

With AvaTrade, when you register for a live or demo account you will find many articles, videos, webinars and other educational tools that not only introduce you to the basics of forex trading, but teach you how to build strategies, learn market analysis etc.

We will guide you to start compiling a trading plan, define what is your trading style, seek out what you want as a trader, what you can absorb in terms of risk, establish your profit goals and the time you can devote to your trading.

Another element of trading online is to learn how to lose small but win big, for instance, by managing your risk to reward ratio of 1:3 per trade placed.

How to Trade Forex

Quite simply, a currency exchange rate is the rate at which the base currency can be exchanged for the quote currency. These currencies are quoted in pairs, such as the widely traded pair EUR/USD where the euro, on the left side is the base, and the US Dollar is the quote. Economic factors such as industrial production, inflation and political events can influence these exchange rates. These factors are the main market influencers for whether you buy or sell a currency pair.

A more practical example of a forex trade is illustrated as follows:

In this example of the EUR/USD the EURO is represented as the base currency and the USD as the quote currency, and it represents the number of US dollars that one euro can purchase. The quotation of EUR/USD 1.2000 in numbers means that one-euro can be exchanged for 1.2000 US dollars.

If you believe that the euro will increase in value against the US dollar over the next 48 hours, you will BUY the euro. Should the exchange rate rise in your favour, you would sell the euros back at a profit. This is how profits are made when you trade online.

Why Would You Trade Currencies?

As forex is now known as the world’s largest and most liquid market, with 24-hour a day operation, and over 5 trillion traded in US dollars in daily volume. Here’s some differences in investing in equities, or trading Forex and CFDs with AvaTrade:

  • With AvaTrade you only pay the bid/ask spreads, rather than commission
  • 24 hours, 5 days a week trading, so you manage and control when, and how you trade
  • AvaTrade offers competitive levels of leveraged trading to magnify any potential gains, which comes with risks too
  • Over 250 instruments for trading, which include Forex, CFDs for stocks, commodities & indices
  • You can get started with only use demo, work your way through the training courses and access customer support in your language

How to perform a trade

Choosing the right Forex broker to trade with is the most essential of all your choices when it comes to online trading. We offer you a free demo account and many forms of educational information, alongside dedicated support from our customer support agents, should you require further services or help.

  • Open your online real account, make a secure deposit, with 0 commissions. Now let’s execute your first trade.
  • After you have conducted your research and, in case you need it, consulted with our support team, head over to the trading platformwhere you can open a position on the instrument of your choice. Take a look at the spread, and decide how many units you want to trade, plus your leverage level. Remember to start small and build up when you get the hang of trading. It is important to use stop loss orders each time you open a trade.
  • Once you have opened a trade, you will need to monitor your investment and keep abreast of its performance. Should you see on a trading chart a decrease in the activity and the markets are trading against you, you should consider a sell, or wait for the stop-loss to kick in, to limit the damage on your account. Alternatively, if you see your trade has profited, then consider closing your position.
  • Making changes to your portfolio from time to time is advised, you are constantly exposed to emerging markets, and you can decide to diversify your trades. Whatever the case, follow your trading strategy, and do not over trade (Read more about trading psychology).
  • Executing a withdrawal request is simple and easy and can be done via the platform.

Learn How to Trade Online With AvaTrade

Want to learn how to trade Forex and CFDs? Potentially increase your gains in the financial markets? AvaTrade will teach you how to master Forex trading. Start now! With all the tools of the trade at your fingertips don’t delay.

We recommend you visit our trading for beginners section for more articles on how to trade Forex and CFDs.
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