The Dark Side Of Forex Trading
The forex trading financial market is an industry dominated by brokers, with its deregulated nature there is no surety on how the trade will go down. If you execute a trade you can not always get the best price that you want, this is mainly due to spreads. There is no transparency what so ever you can never know how a broker operates at all, the best you might do is get a broker that is regulated in some way. There is no secret, there is enough room for the market maker to manipulate the market and there is so little traders can do about it, we must live with it that is the dark side of forex trading.
Highly and insane Leverages
Leverage is when a trader makes use of borrowed funds to increase one’s trading position beyond what would be available from their cash balance alone.
- when forex trading becomes available at high leverages it means that profit can be made so quickly and at a greater percentage as proportionate to one’s capital this is what they want you believe.
- The opposite becomes also the hard truth, when losses are made they are insanely huge losses, you end up blowing accounts.
- Leverages goes even up to 1000:1 at the end of it all the broker is always in profit.
Unpredictable market movements
There are too many forces that moves the financial markets which a human mind cant comprehend all the times. The market makers determines the buying and selling prices which are not in anytime constant. The market is determined primarily by world economics, infatuating rates, world politics and technological advancement upon other things. Most traders then resort to technical indicators which in some instances goes against reason, what can one do this is the dark side of forex. Traders are always in a dilemma can they blindly follow indicators when news is suggesting otherwise, should they follow the trend or instincts its never certain where the market will takes you to.
The market moves 24/7 non stop because of the speed, prices and volatility can never be monitored, in instances where companies are found insolvent and liquidated, traders makes huge losses and it happens so fast. Volatility is only good when you are making money, when you are losing it becomes your worst enemy.