Currency pair trading is a form of investment used by many successful investors. In this article, we will cover what you need to do when trading currency pairs. This is the step-by-step process of how you can start trading and be successful at it!
Currency pairs are when you trade one currency for another. One currency will have a value greater than the other currency it can be exchanged for.
The first currency listed in a currency pair (for example USD/TRY) is known as the base currency. And this always has the lowest number. It means that you need to exchange 1 US Dollar for 3.8 Turkish Lira (3.8 TRY).
The second listed currency is called the quote or counter currency. It tells you how many units of the first currency are needed to buy one unit of the second. For example, 1 US dollar will be needed to buy 4 TRY.
The base currency is also called “the domestic” currency. The quote or counter currency is called “the foreign” currency. What you call it doesn’t matter, both have the same meaning.
We hope the value of the Turkish Lira will either increase or decrease. This way, we can make a lot of money when we sell our Turkish Lira back to US Dollars.
Keep in mind that this process can take a few days, weeks, or even months. Depending on which investment strategy you follow!
How To Trade Forex Currency Pairs?
Developing a successful strategy for trading forex pairs takes time to master. To get started, it is important to understand the basics of the international financial markets and what you are trying to do.
Trading Forex can be done in many ways. But there are three different types of Forex trading strategies to choose from:
- Fundamental Analysis
Fundamental analysis is a way to look at economic data. And international news stories that might change the value of one currency.
- Technical Analysis
This is a more complicated, but powerful way to trade forex. This strategy involves looking at charts and graphs. You can see and predict how much the price moves.
- News Media Analysis
It involves staying up-to-date with the latest news stories that might affect your investments so you can buy or sell at the right moment.
If you’re not sure which type of analysis would be best for you, why not try them all and see which one works best? You may even develop a unique style of trading. Where you combine all three types of analysis into one “hybrid” approach!
The most important thing is to always be learning from your experiences and looking for ways to improve yourself as a trader. Once you have decided which type of analysis or approach you would like to use daily. It’s time to find the best currency pairs that fit your strategy.
The most common forex pairs are made up of the following currencies:
These currency pairs contain two major global currencies paired against each other. When you do these trades, the US Dollar is usually the counter currency. So if you wanted to exchange US Dollars for Japanese Yen, you could have bought USD/JPY.
Emerging markets are growing and traders can make a lot of money. One of the most popular emerging market currencies is the Mexican Peso (MXN).
How To Create Effective Trading Strategies For USD/TRY Pairing?
Creating a good trading strategy is necessary to trade in the forex market. The USD/TRY pairing has been a popular trading pair due to its high volatility. And the substantial price changes, making it a good one for short-term traders. If you want to make a profit from this pairing, here are some tips on how to create an effective strategy.
1) Conduct Research Regularly
You need to do your own research on the USD/TRY trading pair. Besides reading what other people have said about it.
Keep tabs on events that might change the economy. And the conversion rates of the US dollar to the Turkish lira. Understanding these can help you make better trades. You will have a better understanding of what to expect from these changes.
2) Have A Target Take-Profit Level
Knowing when to close your position is just as important as knowing how much money you will make on each trade. For example, if you want to stay in a position until there is around $0.50 between the bid and ask prices. Then you need to set up a target take-profit level that’s within that vicinity.
You can do this by using an online charting service. Or an application that allows live trading via mobile phone (depending on your broker). Sometimes, setting up multiple target take-profit levels can be beneficial. Because you have a better chance of closing your position at a profit before things go against you.
3) Set Up A Stop-Loss Order
Depending on the price volatility of each trade. It may be necessary to use a stop-loss order to protect yourself from heavy losses. For example, if you open a position with 10 lots and the current market price is 1.2400. Then this means that you risk losing $1,400 for every pip that price goes against you.
In such an instance, it would make good sense to set up a stop loss level below these levels (at around 1.2200). Because this is where prices will hit some resistance. And then start heading back upward again.
By using the above points as a guide when it comes to putting together a solid trading strategy. You should have much better odds of being profitable when trading the USD/TRY pairing.
Gaining Capital Using Your Newfound Trading Skills!
Now you know all there is to know about how to trade forex pairs, so why not start making some real money? The first step is opening a practice account with a top online broker or Forex trading platform.
There are dozens upon dozens of brokers out there, but keep in mind that not all brokers are created equally. We recommend using one of the following platforms:
RoboForex is a popular company that is a top leader in Forex. They have competitive spreads and small margin requirements for their clients.
They’re also loaded with special features such as:
The Simple, Pro, and VIP Account types. The variety of tradable instruments, including currencies, indices, and CFDs (contract for difference).
A simple registration process that takes only a few minutes to complete. A free demo account and no-obligation cancellation policy.
What Sets Them Apart From Their Competitors?
The RoboForex group has been around since 2009 and has offices in both Cyprus and Russia. They’re known for their advanced trading platform. As well as top-notch customer service and support.
These people have been recognized by online trading experts. They include Forex Magnates and FXStreet.
The company website says that they have received awards from different industry publications. They have won awards for best ECN/STP broker, best retail FX provider, and most popular currency pairs. Serving thousands of customers around the globe.
RoboForex is a good option if you want to trade Forex. You do not need any experience in Forex trading. RoboForex offers competitive spreads and advanced features. They say that their platform is the most stable and reliable in the industry.
- Averaging spreads.
- A variety of trading instruments, including indices and commodities.
- Perpetual contracts, which function like ordinary trades but don’t expire.
- The minimum deposit requirement of $250 may be too high for some traders.
- The top-tier accounts are only accessible after the customer has traded 10 lots with lower tiers.
Vantage FX is a foreign exchange broker that was founded in 2010. And is headquartered in Sydney, Australia. It is owned by UK-based Vantage Global Prime.
They are serving people in over 120 countries. Regulated by the Australian Securities and Investments Commission. The UK’s Financial Conduct Authority, Dubai’s DFSA, and New Zealand Central Bank.
Their company offers many things, including trading foreign currencies. It also offers tools for technical analysis of the price of fresh stocks. They have educational materials and they also offer apps for mobile devices. So people can trade on phones as well.
The charting packages of Vantage FX have a lot of things to offer. No matter what kind of trader you are, these packages will be useful.
What Sets Them Apart From Their Competitors?
The main thing that makes Vantage FX different from other brokers is they have no commission fees and competitive rates. They also offer educational materials.
They are known for their customer service. They have all the things that you would want in a Forex broker, like MT4 and a chat room. You can get their products on the web or mobile devices.
Currently, over 20 types of instruments can be traded via MT4. (such as AUD/USD, EUR/GBP, USD/JPY) or HTML5 platforms (AUD/CAD, NZD/JPY).
- Flexible spreads that vary depending on the client’s account type and their trading behavior.
- Low commissions.
- Leverage of 1:500 for most currency pairs. Meaning that if a trader deposits $100, they can trade up to $50,000 in value via margin.
- The ability to quickly withdraw funds from your account by using your credit card or bank transfer.
- Investor protection solely applies to British nationals.
It is up to you which platform you choose, but make sure that the one you pick supports high leverage.
Once you have picked a forex broker online, open a demo account with them. Then do some “virtual” trades with real-time data from markets. So that you are comfortable using the platform before making any “real” trades.
To start, here are some of the most common currency pairings that you should consider in your early stages of Forex trading:
- EUR/USD – This is one of the most popular forex pairs because it comprises two major global currencies.
- GBP/JPY – Pairs the British pound against the Japanese Yen.
- USD/CAD – Pairs one US Dollar against one Canadian Dollar.
- AUD/USD – Pairs one Australian dollar against one US dollar.
- NZD/USD – Pairs New Zealand’s economy against the United States.
These are only a few suggestions. There are many more to choose from!
It’s best to pick a few currency pairs that apply to your trading strategy and keep at it until you become profitable. The most important thing is that you develop a style that works for you. You can then trade stocks with people all over the world.
Note: Remember, don’t trade with real money until you have tested, tested, and then tested some more on a demo account!
Benefits Of Trading With USD/TRY
- Quick access to the European common market.
- Interest from EU traders when investing in US properties.
- A stable currency with a high investment capacity.
- Robust foreign direct investments in Turkey.
When trading internationally, it’s simple and profitable to use the USD/TRY rate. It is one of the most effective methods to start a foreign business.
The Turkish Lira is a stable currency with a high investment drive. Unexpected gains are possible, but the level of risk is generally low.
Turkey’s Geographical Advantage
The nation’s location between Asia and Europe means it has access to both common markets. This, along with how it has a competitive economic market, allows Turkey to trade effectively across borders. Something which greatly enhances its overall appeal as an investment destination.
The city of Istanbul is important for global players. This is a good thing for the economy in Turkey. It gives businesses many opportunities to buy and sell things internationally.
Global Trade And Investment Opportunities
It is easy to exchange money using the USD/TRY rate. Which makes business much easier for people who are doing business internationally. Because instead of thinking of different currencies. They only need to think of USD as a common denominator.
So people can focus on the real value of their activities. And are not taken by surprise if the two countries use different types of money. Based on this, you can conclude that it is easier for US citizens to make transactions with foreign buyers.
In addition to this, U.S. brokers provide low-cost banking services which any person or business can benefit from. Nowadays, more and more businesses try to expand internationally. Because there are a large number of new customers.
There is also no need to worry about the exchange rates fluctuating mid-way during the negotiation process. Since the USD & TRY exchanges rates fluctuate closely to each other. It is very easy to check them and immediately see if the trade is profitable or not.
Of course, there are some more benefits when doing business transactions with Turkey.
Some of these are listed below:
- There are no restrictions on the amount of money that can be transferred from the US to Turkey or vice versa.
- The exchange rate between U.S. Dollar and TRY has historically been stable over time. Making it easier to test any business transactions conducted in this currency pair.
- Transferring money from an American bank account into a Turkish bank account takes only around 2 days. Depending on the banks involved in both countries.
How To Invest In US Properties Using USD/TRY
Investors can use the common markets to buy and sell their stocks in other countries.
For instance, if they were previously trading in GBP or Euros, shifting over to the USD/TRY is an easy transition. This will give them more room for growth and profit opportunities in various market conditions.
Investors can find it safe to trade in dollars even during periods when volatility picks up or drops significantly. They can also enjoy returns on larger investments. Which would otherwise only be possible using other currencies.
Understand, however, that when trading with USD/TRY there are certain factors to consider. Exchange rates may go up or down in the short term. They depend on what is happening in other countries and how it affects investments.
The biggest issue is likely to be exchange rate volatility which is hard to predict in advance. Additionally, you need to understand your tolerance for risk before getting started. Especially if you’re investing large amounts of money into overseas real estate deals. Or following up on opportunities with business partners abroad.
Top 5 Tips To Successfully Trade USD/TRY Currency Pair
- Keep A Trading Journal
Keeping a trading journal is important for you to document your thoughts and feelings when in a trade. It will help with mitigating emotional responses to real or perceived market conditions.
It will also allow you to review your performance over time. Which can help identify problem areas and ways to improve them so you can become better at trading.
- Prepare Your Trade Before Entering The Market
Most traders do not take the time to properly prepare their trading environment before they trade. This is an important step that many traders neglect to take, which leads to poor results.
These preparations may include checking for economic releases at your trading times. Testing out news release strategies, or learning about the currency pairs you are most comfortable with. And how to use them appropriately in your trading strategy.
- Conduct Fundamental Analysis (News Trading)
Conducting fundamental analysis means gathering as much information about the market. For a currency pair, you plan to trade.
This can be done by reading up on macro-economic events. Browsing various financial websites, discussing current conditions with experienced traders. And developing a thorough understanding of the economic conditions.
- Only Use Significant Indicators To Make Trades
Do not use every indicator you find to make your trading decisions. Only use significant indicators that can help you figure out how the market is doing.
This means using many different types of charts. They are called Bollinger Bands, Moving Averages. Relative Strength Index (RSI), On Balance Volume (OBV), and Stochastic Oscillator. I recommend one of these four indicators for day-to-day Forex trading purposes.
- Use Stop-Loss Orders And Take Profits – Cut Your Losses Early & Let Your Winners Run
This applies to all types of trading. But is so important when you are using a high-risk strategy. Setting proper stop loss and take profit levels is crucial to your success in the markets.
Being able to “cut your losses short” and “let your winners run”. Can save you from turning a small account balance into an unrecoverable one.
To help make sure your head doesn’t spin too much, here’s a quick recap of what we’ve covered:
Trading currency pairs is profitable if done right.
Follow these strategies for successful trades:
- Fundamental Analysis
- Technical Analysis
- News Media Analysis
Best Brokers to try:
- Vantage FX
Take Turkey’s geographical advantage to make USD/TRY trades. Open up global investment and trading opportunities.
Invest wisely by accessing the common market. Educate yourself on the ongoing trends and news to increase profit percentage.
The best trade success tips:
- Keeping a journal
- Preparing before entering the market
- Detailed fundamental analysis
- Only using significant indicators
- Creat stop-loss orders
You’re all caught up, guys. You can start trading Forex like a pro now.
What Is The Benefit Of Currency Trading?
Currencies are constantly changing in value relative to one another. When you trade currencies, the goal is to buy low and sell high (or short). Profits are made when a trader buys a currency for a lower price than they can sell it at later.
Why Is Currency Trading Popular?
There are many reasons that traders find the forex market attractive:
– Foreign exchange trading hours
– Global availability
– Low cost of entry
– High liquidity
– Low transaction costs
Is VantageFX A Good Broker?
Yes. Vantage FX is a good broker. They have a low transaction cost, which they charge on a per-pip basis.
They also have high liquidity and typically offer lower spreads than most other brokers in the market. Vantage FX also has a service offering that includes both mobile trading apps and web trading platforms.
Is Trading Foreign Currency Worth It?
Yes. Because they may provide returns and help you make a lot of money. Diversify your portfolio, and establish yourself as a forex trader. Foreign currencies are attractive investments.
Even if it’s unquestionably worthwhile, you must be well-informed, focused. Have self-discipline and patience to succeed in this field.
How To Start Trading Currencies?
Before trading currencies, one needs to select the market (a specific currency pair) they want to trade. Different pairs are traded at different times throughout the day.
Then one must decide on their entry point where they can either buy or sell. After that, it is just following the simple steps of discipline and commitment. This means that you should not change your strategy when there are circumstances that tempt you to make bad decisions.
What Is The Best Time To Trade USD?
The best time to trade the USD is around 12:00-15:00. This is when trading opportunities are at their most abundant. And when trades are the most profitable.
What Are The 4 Trading Sessions?
The four trading sessions are set hours that determine when traders can buy and sell currencies. The largest trading centers, which include Sydney, Tokyo, London, and New York. They account for 75% of daily foreign exchange trading.
How Long Is A Trading Session?
A trading session starts as soon as the market opens and lasts for the next 2 hours. For example, Monday morning trading at 9:00 am EDT, will close at 11:00 am EDT.
Why Is There A 3 Day Settlement Period?
Usually, the 3-day settlement period is in place to ensure that investors can withdraw money from their stocks.
This provision is made so that when an investor buys a stock for 100 USD and the following day it closed at 97 USD. The investor could cash out his or her shares with no problems.
How Do Banks Make Money From Foreign Exchange?
Foreign currency trading is a profitable business for banks. They make money by having a bid-ask spread.
As currency traders, banks speculate on currency fluctuations and act as dealers for clients to execute trades. Banks also aim to use their large balance sheets (i.e., deposits) to keep currency rates at desirable levels. So they can make their speculative trades.