Foreign exchange trading is far from a standard job. In some ways, it might seem like it: the markets don’t operate at weekends, for example, while it’s also perfectly possible to set up trades during the working day.
However, being a foreign exchange trader requires a lot of commitment – and it takes some flexibility, and willingness to work anti-social hours, to get it just right. This article will delve further into the issue.
The foreign exchange market is known for being one of the more ever-changing and volatile asset classes.
It’s perhaps a little closer to cryptocurrencies and other volatile investment destinations as opposed to asset classes such as government bonds, which are in theory much more stable.
What this means from the perspective of timing is that there can be sudden reversals in price movements that need to be responded to.
To a certain extent, it’s possible to manage these risks in advance by using order control tools such as stop-losses.
However, there will still inevitably be some sudden movements that need to be reacted to out of hours.
Most sophisticated broker platforms contain notification systems – and responses to alerts during the night can make the difference between a profit and a loss (or a significant profit and a small profit) for a trader.
So much information
In addition to the challenge posed by the speed of forex market fluctuations, it’s also the case that there’s a lot of information to take in in order to place trades.
Traders who take a technical analysis approach have to read through price charts, for example, and apply technical indicators and other tools to sift through the information.
Those who take a fundamental analysis approach, meanwhile, are likely to find that they need to spend hours a day reading financial news and assessing economic calendars for significant events such as central bank interest rate decisions.
The majority of traders are likely to take a hybrid approach, and therefore need to spend time on both approaches.
It’s also important to look at broker reviews in order to ensure that the risk of fraud is significantly reduced. Websites such as Forex Fraud can help in this regard, as they contain information about the best and worst brokers on the market – and allow you to benefit from the shared experiences of others, and avoid their mistakes.
This is the sort of time cost that is only required once in a while, but it’s also a very important one: it’s the kind of activity that can save lots of money and time in the long run by reducing the risk of fraud.
In short, forex trading isn’t the sort of occupation that can necessarily be compressed into a standard working day.
There are so many time-consuming activities on a trader’s to-do list: from the requirement to assess fundamental factors to the need to respond if prices fluctuate, it’s best to take a flexible approach if you want to make your forex trading career a success.