Mastering Simple Steps To Start Forex Trading With Bitcoin

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Discover the basics of bitcoin trading on the Forex market in full. Our guide explains everything about how it works and examines all the advantages and risks, as well as the main strategies.

Forex Trading With Bitcoin: How Does It Work?

Today, the Internet is full of information about making funds by trading forex, which guarantees that you will be wealthy immediately, but few people wonder if it is true. Is it truly achievable to earn funds this way, are there any risks, and how does it all work?

What do we know about Forex?

Forex is a currency exchange, which is the largest international currency market. Its day-to-day trading volume is higher than all national financial markets combined. The peculiarity of forex is that they do not buy or sell real currency here, but only conclude transactions to increase or decrease exchange rates. Initially, this trading system was developed by specialized forex dealer firms.

Why is forex trading so interesting to people?

The interest of such a large number of people in this topic is explained quite easily – there are minimum requirements for entering the topic and lots of cryptocurrency insights. On the contrary, it usually does not require a lot of money or any special equipment to start trading. All you need is to have Internet access and a special program on your computer, which acts as a trading terminal. And lately everything has become even easier because even applications for the phone are appearing.

It all sounds very simple and that is why every year a huge number of people lose their funds. Like any other area related to finance, this requires study, strategy and structure. So the convenience of using it does not mean that it is very simple to earn funds on forex, on the contrary, the risks of losing money are very high.

Why Bitcoin?

Everyone knows Bitcoin, it determined the direction of development of most cryptocurrencies in today’s crypto market. However, these are cryptocurrencies that many can name, but few people understand well anything about them. Bitcoin is known for its volatility, as a result of which traders can experience huge price fluctuations when trading it, which increases both its attractiveness and risk.

What to keep in mind

Cryptocurrencies operate in an infrastructure characterized by fewer rules than traditional financial markets. This generates multiple risks and reduces the level of investor confidence. In addition, due to its unregulated nature, support from other parties is very low. This support may be necessary because bitcoin matching servers on some exchanges are unreliable, which can lead to inaccurate transaction execution because they are not updated quickly.

I decided to try it anyway. How to act?

Choose a Forex dealer

The most important thing is that the dealer must have a license from the country’s Bank. There are also official websites of all licensed forex dealers for different countries. If you do not have the license you need, the threat is not supported by anything. These are either obvious frauds with whom you will lose money, or third-party companies that operate illegally in the state. And in case of problems, you will have to sue them in the country where they are registered.

In addition to the license, it is worth mentioning a few more things:

  • is it possible to get pre-training before proceeding to bidding;
  • is it easy to install a trading terminal program or mobile application on your computer or smartphone;
  • is there a demo version to figure out how the terminal works and test your strategies;
  • does technical support work well: is there a hotline, or an online chat, how quickly do consultants respond;
  • what is the minimum deposit amount (the probability of losing this amount is very high, so first choose options with a small minimum deposit).

Take the test

All new clients of the forex dealer who do not have the status of a qualified investor must undergo free testing. The test consists of 10 questions. Each one is given at least four possible answers, from which one must be chosen. Each correct answer will earn you from 1 to 3 points, depending on the complexity of the question. In total, you need to score at least 13 points out of 15 possible. If you fail, the forex dealer will not allow you to trade. You can retake the test as many times as you want. Forex dealers conduct testing in their offices, on websites or in mobile applications for stock trading. It is enough to pass the knowledge test once for each dealer, but if you want to switch to another intermediary, you will have to pass the test again.

Practice on the demo account

Even if you are well versed in the theory, before risking real money, it is worth trying out different trading strategies on a virtual account. It is very difficult to predict exchange rates based only on information about what is happening in different countries. Therefore, to help players, these programs analyze indicators of currency movements and help build trading strategies. However, the probability of error is still high.

Open a real account

Have you practiced on the demo account? Have you worked out different strategies that you learned during the training, have you chosen several that are suitable for you? Now you can open a real account. You determine the amount on the account yourself, but a forex dealer may have restrictions on the size of the minimum deposit. It is better to start with a deposit that you will not be afraid to lose. It is not a fact that your strategy, tested on a demo account, will be just as successful on a real account. You will have to spend some more time and money to work on it and develop your strategy. You can use several strategies at once, so you will reduce your risks a little.

Conclusion

There are no guarantees of income in forex. The money that you deposit with a forex dealer is not insured by the state. It is important to understand that this is a serious financial transaction and you can not only not multiply your funds, but also lose them, so that this does not happen, study the issue in all the details before deciding to try, especially when it comes to such a volatile cryptocurrency as bitcoin.

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