This article looks at the reasons why you should consider using the forex Australia market.
There are numerous reasons why one would wish to trade the forex Australia market. Many traders trade because of the high payout, which others trade because they enjoy engaging in foreign currency trades. This article explores some of the more popular reasons traders choose to participate in this volatile forex Australia market.
The Level Playing Field
Other financial markets do not have the same level playing field that forex does. With the use of technical analysis all traders are given the same opportunities. Fundamental analysis is also a more level playing field in forex. Unlike the stock market these are no ‘insiders’ who are able to get information before anyone else.
The Forex Australia Trading Hours
With the forex market you are able to trade any currency at any time. This is due to the decentralised structure of the market. The long open hours of the market also makes it easy for any retail traders to compete. The risk you face in this market can be controlled better than in other markets because you can spread it across a number of different currencies.
The Analysis Methods
You do not only have to trade using technical analysis of chart movements. Fundamental analysis can also be used as the price of currency pairs are affected by the economic and political news of a country. The best part of forex fundamentals is that they are available to everyone. If you have access to the internet you will be able to find all the fundamental news you need to trade.
The Trading Options
There are a number of different ways that you can make a profit on the forex market. The first way is to buy low and sell high. You can also make money through carry trading. This type of trading allows you to earn interest when you hold certain currency pairs. The number of different currency pairs that you can trade also allows you more opportunities to earn. If you feel one currency pair will not make you a profit you can always look at a different one.
The Diversification of Your Portfolio
If you already trade on other equity markets then you might want to look at diversifying your portfolio. This can easily be done by including forex trading. One of the differences between stocks and forex is that you can make a profit on the forex market when the currency devalues. However, you cannot make a profit on stocks when they devalue.
The Other Side
While there are a number of reasons why you should be trading forex there are a number of drawbacks that you should be aware of. One of the main issues in the market is that of risk. If you do not correctly interpret the market trends you are more than likely to experience severe losses. If you have taken advantage of the high leverage offered by forex brokers then there is an even greater chance that you will lose your trading capital. However, do not let this deter you. Trading risk can be managed through the development and use of an effective risk management plan and trading stop losses.
Get a free Forex PDF PLUS:
- 14 Video Lessons
- Free One-on-One Training
- A 5000$ Training Account
- In-House Daily Analysis
- Get FULL ACCESS