Introduction to forex trading
Contrary to what many people may think, forex trading is not a new phenomenon. In its simplest form, foreign exchange is an activity that has been in existence since central governments were established and barter trade was replaced by currencies.
Back then currency exchange revolved around coins forged from precious metals such as copper, silver and gold. The weight of the coin and its purity determined its value. When fiat currency came into being, money changers who often set up at market places would facilitate this exchange at a fee.
Gold standard and foreign currency reserves
It wasn’t until the 18th century that first forex market was established in the Netherlands where trading took place mainly between them and the United Kingdom (in GBP). In the 19th century, the gold standard was introduced and this became the asset that supported currencies worldwide. Thereafter, most countries began accumulating reserves of stronger foreign currencies to support their local currencies.
Initially, forex trading was not an easy process. You would need to deposit your money with a forex broker and the call/email them any trading instructions that you want to be executed. It was similar to what stock trading entailed so the control was not fully with the end customer.
Currently, most forex brokers allow traders to participate in the forex market from the comfort of their computers and mobile devices. All you have to do is deposit your funds with the broker and these funds will appear in the MetaTrader4 platform. From here you can dive straight into trading. They make this possible using the tools below:
- MetaTrader4 for PC
- MetaTrader4 for MAC
- MetaTrader4 multiterminal
- MetaTrader4 Web trader
- MetaTrader4 for mobile (android and apple)
Introduction to MT4 platform
MetaTrader 4 (MT4) is an application that provides traders with a platform to analyze and participate in the forex and commodities market. It basically gives you direct access to place trades just like a stock broker would do on the trading floor at the NYSE.
The fact that one can execute trades at the click of a button is probably the reason why the forex market has a much bigger trading volume compared to different stock markets around the world. In actual fact, the forex market is responsible for trade volumes to the tune of $5 trillion worldwide. This can be compared to only about $50-100 billion which is a total of volumes traded in the major stock markets worldwide.
MetaTrader4 Web-based platform
If for some reason you are unable to install the desktop or mobile version of MT4, this does not mean that you will be unable to trade. One of the most convenient things about the MT4 web-based platform is that it is accessible from any device that has a browser and a stable internet connection. The web based trading platform can be accessed from any operating system and browser including but not limited to Google Chrome, Edge Firefox, Safari and Opera.
This means that no matter where you are in the world, you will still retain accessibility to the forex market.
Coincidentally, the current generation of traders prefers to have a more fluid working arrangement. This is very different compared to the previous generations that would work an 9a.m-5p.m desk job for 20 years and above. Instead, this generation prefers to travel the world, work on different projects while working remotely.
Both the MT4 mobile application and the MT4 web terminal offer the full functionality that is offered by the desktop version. This includes the security of the platform, different types of trading orders, chart analysis tools such as indicators and interactive quote charts.
Another useful feature is that one can also access his/her trading history from the MetaTrader4 trading platform.
The introduction of MetaTrader4 web trading terminal is a technology that has truly revolutionized forex trading. It is a change that has empowered millions of traders around the world to earn their living from the comfort of being wherever.