One of the most stable economies in the EU, Ireland serves as a major activity hub for forex on the European continent. The Global Financial Centres Index (GFCI) ranks Dublin as the No. 5 financial hub in Europe and No. 38 in the world. Regulation from multiple financial authorities helps secure transactional fidelity and provides a safe and even welcoming launchpad for forex speculation.
The euro is 1 of the strongest currencies in the world and offers a great advantage if you want to participate in the forex market in Ireland. Keep reading for everything you need to know about getting started with forex trading in Ireland.
Get Started with Forex in Ireland
Follow these steps to get your financial infrastructure ready for forex trading.
- Make sure you have a fast internet connection. Connect to a forex broker through any desktop, laptop or smartphone. If you can connect from a setup with a large screen space, that is an advantage as well. Successful forex traders base their trades on a lot of information. News, charts and account reports can be difficult on a handheld phone!
- Choose a broker. In Ireland, the business of being a forex broker is competitive. Use that to your advantage to get the best one for you. Reputable forex brokers offer fast execution, proprietary analysis and helpful customer service.
- Open your broker account. After you have the broker you like, open your account following the broker’s instructions. Each business will have a slightly different verification process and ways to connect to a funding source.
- Fund the account. It takes money to make money! You should be able to fully fund your forex account from a personal check, your bank account, a debit card or a credit card.
- Pick a trading platform. Your broker may have a proprietary trading platform. If so, you probably want to use your broker’s software. If not, pick the trading platform you feel most comfortable using.
- Start trading. Once your infrastructure is set up, you can instantly begin to trade in the forex market!
Ireland Forex Trading Strategies
Learning how to trade forex successfully involves lots of study and knowledge of investment strategy. Here are some of the most popular forex trading strategies that you should know about.
There’s only 1 rule that all day traders respect: You must be in all cash by the end of the day. That means you have to make your money quick. Day traders are not concerned about long-term moves in the market. Chart technicals are much more important than currency fundamentals. If you want to make money fast, this may be the trading strategy for you.
Day trading includes an extremely fast form of trading known as scalping. Scalping is exactly what it sounds like — you move as fast as possible, shaving profits off of the top. In some cases, you’ll be on minute charts, exiting trades in seconds. Timing is everything, so make sure your trading setup and internet connection are as close to perfect as possible. You’ll be in competition with some of the most powerful traders in the world, including market makers.
Swing traders fall into 2 basic categories — range traders and trend traders. Both of these types have similar skill sets. The real difference in the style has to do with the movement of the market, not the trader. Range traders buy low and sell high between a support and resistance range. Trend traders catch a directional ride when a currency decides to move up or down substantially in value.
Swing trading is a short-term strategy. You may hold your position for a number of days, but usually not much longer. You may need to understand some of the macroeconomic conditions behind a currency pair but you will also need to know how to read chart patterns.
Positional trading is for investors who like to profit from long-term moves. If you are in a trade longer, you can usually expect bigger moves. Positional traders aren’t worried about short-term pullbacks in the market or unexpected news items. Over the long term, illogical short-term moves have less influence than macroeconomic conditions.
If you like studying the inner workings of global finance, positional trading is for you. Studying the relationships between countries and business trends should help your success rate.
Forex Trading Example in Ireland
EUR/USD is trading at 1.12161/1.12603. You want to invest in the euro price rising. You prepare to buy 100,000 euros. The margin rate of this currency pair is 3.09%, so you will only need $3,472.60 in your account to purchase the full 100,000 euros. Your broker will let you borrow the rest.
The EUR/USD price moves up and is trading at 1.13010/1.13120 after 3 hours. You have enjoyed a move of 4.07 points and your profit is (100,000 euros *1.13010)-(100,000 euros*1.12603), or $407, when you sell.
Making Money with Forex in Ireland
You can make money in many ways in the forex market.
- Shorting a currency: You can borrow a currency and sell it for a high price, buying it back later for a lower price. This is shorting and it takes advantage of downward moves in the market.
- CFDs: Contract for differences (CFDs) are not currency pairs. They track currency pairs. Depending on the broker you choose, you will be using CFDs instead of buying and selling actual currencies. Practically, using CFDs is the same.
- Binary options: You can trade currencies using a simple yes/no metric instead of tracking the direct movement of a currency pair.
Best Online Forex Brokers in Ireland
When you get ready to invest, you have a number of viable forex brokers in Ireland to choose from.
Before investing, it’s good to learn the lingo of the industry.
- Pip: Also known as a basis point, this is the smallest unit that forex uses.
- Lot size: The lot size is the amount you trade in a single order. A standard lot size is 100,000 units of a currency.
- Orders: You give an order to the forex market just like you give an order to a waiter.
- Calls: This is a contract that lets you buy or sell a certain amount of currency at or before a certain date.
Investing in the World
Forex may be easy to learn, but it is difficult to master. Investors spend their entire lives dealing with the nuances of currency, so give yourself time. Trade using a virtual account (a fully functional account with fake money) before using real money to invest.
Be sure to bookmark this page for updates on forex. Read as much as you can about forex at Benzinga and how to profit from it.
Benzinga's #1 Breakout Stock Every Month
Looking for stocks that are about to breakout for gains of 10%, 15%, even 20% potentially or more? The only problem is finding these stocks takes hours per day. Fortunately, Benzinga's Breakout Opportunity Newsletter that could potentially break out each and every month. You can today with this special offer: