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Online Forex Day Trading

Online Forex Day Trading
June 07
01:55 2011

forex market

Day trading in the forex market was until very recently primarily limited to professional traders employed by major financial institutions like commercial and investment banks, although traders working at large fund management firms and multinational corporations also sometimes got involved in day trading currencies.

Some high net worth traders could deal forex as bank customers, and smaller personal currency traders were also able to operate on margin via the major futures exchanges like the Chicago International Monetary Market or IMM. Nevertheless, the forex market was then largely closed to lower net worth retail traders.

Online Trading Brought Forex to the Masses

That exclusive little trading circle widened substantially with the explosive growth in popularity of the Internet. The relatively recent advent of online forex trading via electronic currency brokers has now brought the possibility of day trading the forex market to virtually any household with a recent computer, an Internet connection and a small cash stake to speculate with.

The revolutionary development of online trading in the forex market has significantly increased transaction volume in the already huge forex market that currently averages over $3 trillion in turnover per day. Such a massive daily transaction volume makes the foreign exchange market the largest financial market in the world today.

When combined with its twenty four hour access during business days and tight dealing spreads, the huge forex market provides an excellent opportunity for the average person to get involved in online forex day trading from their home or office.

How Online Forex Day Trading Works

The first step to getting involved in online forex day trading is to get connected to the Internet and prepare your computer by obtaining and installing a forex trading platform. You can usually get this important software at little or no cost when you open an account with an online forex broker that can now be done with under $100 placed on deposit with the broker as margin.

Some forex day traders prefer the popular independent forex trading platform known as MetaTrader4, which is also now available in a new version called MetaTrader5. This free forex trading and charting software package is especially popular because it can be automated to follow an objective trade plan without human intervention using its own proprietary programming language.

Such a sophisticated forex trading platform can be used by those new to online forex day trading to keep track of the forex market as they develop a well defined and profitable trading plan that is usually considered the key to disciplined day trading that has a better chance of being successful over time.

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Today’s Day Trader Strategy

One of the most common and destructive mistakes a day trader makes is to simply not follow their plans. Temptation, an “obvious signal”, and just simple greed can lead traders down the road of being undisciplined. This is without a doubt one of the most dangerous mistakes, as traders will often lose more than they originally planned as they raised their amount risked.

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