Forex: A Newbies Guide

By Alan Northcott

Forex – A Newbies’ Guide explains all you need to know to get started in Forex trading.

Forex stands for foreign exchange, and is a way of making money by trading on the currency markets, This book shows you forex made simple, explaining just what you can expect:

* An introduction to the symbols, jargon, and mechanics

* Forex brokers (what to watch out for)

* Fundamental analysis (what moves the markets)

* Technical analysis (how you can anticipate the moves)

* Handling your money (don’t try to make a profit!)

* Dealing with your losing mindset (you have one, it’s only natural!)

* Planning your approach

* Forming a winning forex strategy

By the time you finish this book, you will be aware of all the possible pitfalls and equipped to make a profitable hobby out of Forex trading.

The Newbies’ Guides to Finance books give critical advice on a variety of financial issues, and Alan Northcott is an experienced financial writer and trading educator.

Here's what people are saying about Forex – A Newbies’ Guide:

“This book is about the Foreign Exchange Market (or Currency Market) and deals in plain English with everything a person needs to know to obtain a true appreciation of this topic. I like the book's down to earth approach. It is well written and well-structured. I highly recommend it to everybody who wants to obtain a solid basic understanding of what Forex is all about.” - Johann David Renner

“This is a good book for Forex traders to read, either new to Forex or trading for some time you will find useful background information and a great overview of the bigger Forex picture which I think is essential if you are going to be successful as a Forex trader.” – Matt Lowe

• Language: English
• Publisher: Alan Northcott
• Release date: Jun 20, 2021
• ISBN: 9780463639207

Alan Northcott

Alan Northcott is a successful financial author and trading educator, having been writing in the sector for some years. He has ten conventionally published books which were completed with Atlantic Publishing, and more recently has self published four more. These are in the "Newbies' Guide to Finance" series, and they fill a perceived need for straightforward introductions to various aspects of finance. All books are available in print and Kindle editions. In addition to the books published under his name, Northcott has ghostwritten several other books and regularly contributes articles and other writing for a variety of print and online clients.

Book preview

Forex – A Newbies’ Guide

(Formerly published as Newbies’ Guide to Forex)

An Everyday Guide to Foreign Currency Trading

Alan Northcott

Copyright 2013 Alan Northcott

Smashwords Edition

This book is available in print at most online retailers

This ebook is licensed for your personal enjoyment, and may not be re-sold or given away to other people. If you would like to share this book with another person, please purchase an additional copy for each recipient. Thank you for respecting the hard work of this author.

This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is sold with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional services. If legal advice or other expert assistance is required

Table of Contents

Disclaimer and Risk Disclosure

Introduction

Forex Essentials

Forex Brokers

Technical Analysis

Fundamental Analysis

Money Management

Discipline

Psychology

Planning

Sample Strategy

Appendix – Forex Robots

About the Author

Final Note

Disclaimer and Risk Disclosure

By reading this book you agree that this book and any ideas expressed within are for informational and educational purposes only and do not constitute advice or recommendations. Trading foreign exchange on margin is a risky business, and may not be suitable for all investors. You must understand that the high degree of leverage can work against you as well as for you.

Before you start Forex trading, you should carefully consider your financial situation, your level of experience and knowledge, and your appetite for risk. You could lose some or all of your trading capital, and you should not trade with money that you cannot afford to lose. No liability is accepted by Alan Northcott or his successors for any losses whether direct, indirect or consequential suffered by the use of any information contained herein.

The information given in this book is for educational and personal enjoyment purposes only, and is not a recommendation to enter into trading in any form. If any specific trading or investment or legal advice is required, the services of a competent and appropriately licensed person should be sought.

Back to Table of Contents

Introduction

Many people are drawn to the prospect of Forex trading because they have heard about the leverage that can be employed, using a small amount of money to control a large amount of money, and therefore with the possibility of making money much faster than you could by simply investing in, say, stocks.

These people have also, probably, read the warnings in other books and courses, the ones that point out that leverage or gearing of your money is a double-edged sword, and can result in losses much greater than your initial stake – but they may try to ignore it.

If you think about it, it is obvious that more is lost by Forex traders than gained. Simply, every trade has two sides, or two parties to the transaction, each of whom thinks they are going to gain. What one wins, the other loses. And although you do not pay direct commissions for Forex transactions, there is a difference between the buying and selling prices, called the spread, which effectively takes a little out of each deal for the Forex broker. Therefore, traders as a whole finish worse off.

The statistics are actually a little worse than that would imply. It's estimated that more than 80% (some say 90%) of would-be traders fail and have to give up. You see the ones that succeed are continually taking beginners to the cleaners. They need a constant fresh supply of novice traders and their funds, so they can continue to enjoy their success.

So does that mean you should give up now and save your money? The answer for some people is probably. If you're going to compete with the experts, then you cannot expect to do so simply by buying a $97 Forex robot, or by looking for a secret trick that you can implement in 5 minutes. You need to be prepared to study and analyze the markets, and to make sensible decisions, and even then no one with realistic knowledge of the markets is going to guarantee that you will make a profit. If you want to take on the challenge, pitting your wits and knowledge against others, then read on to gain an understanding of the task at hand.

Life is a journey, not a destination – Ralph Waldo Emerson. So it is with trading. You do not learn trading and then go off for 30 years making money on the markets. You need to stay fresh and open to current ideas by continuing your trading education. Though the basics of trading are (relatively) immutable, you should consider this book simply the start of your trading education and career. It is the author's intent to give you the best grounding possible, so that you can look forward to a long and successful vocation.

I have set up a companion website to this book, called http://www.newbiesguidetoforex.com. I hope you will visit it and look around, as I have reproduced all the diagrams there (for clarity) and have set up a forum for discussions – with your help, we will get an active Forex group going!

A.N.

Back to Table of Contents

Forex Essentials

Background

Forex, or foreign exchange, is simply the buying of one currency with another currency, with the hope that your transactions will be profitable. It is only in recent years that it has become so popular, because the Internet and changes in regulations have allowed individual traders to have access to the markets