Though Oman’s economy has traditionally been heavily associated with commodities like oil and gold, a growing number of traders are taking advantage of the country’s modern infrastructure to trade forex. Contrary to popular belief, forex trading in Oman is safe, legal and well-regulated. If you’d like to learn more about how you can begin trading forex in Oman, our comprehensive guide will help you take the first steps.
Get Started with Forex in Oman
The first step to becoming a forex trader is opening a forex brokerage account. Your brokerage account allows you to buy and sell currencies with the assistance of a regulated and licensed brokerage firm. No matter which forex broker you work with, you’ll go through the following steps to open an account.
- Step 1: Find a stable internet connection. Oman’s well-supported high-speed internet infrastructure makes it an ideal country to trade forex in. Before you open an account with a brokerage firm, be sure to stabilize your internet connection and run a speed test.
- Step 2: Choose a broker. There are many domestic and international brokers offering services to Omani traders. Research each broker’s regulation status, fees and customer service options before you choose where you’d like to open an account.
- Step 3: Open an account. Once you find a broker that you’d like to work with, use the broker’s online process to open your account. You’ll often need to provide a bit of personal information before you can fully access trading options.
- Step 4: Choose a trading platform. Though some forex brokers offer their own complimentary platform, you might need to download a 3rd-party trading platform like MetaTrader 4 or 5. Choose a platform that works with your broker and consider your mobile trading needs before you decide.
- Step 5: Fund your account. Once your account is fully operational, deposit trading funds. Direct bank transfers and credit and debit card transfers are widely supported across Oman. Some brokers also support e-wallet transfers from companies like Skrill and PayPal.
- Step 6: Make your first trade. It can take a few days for your first deposit to clear. As soon as it does, you can place your first trade.
Oman Forex Trading Strategies
Most traders who trade the Omani riyal use technical analysis when predicting how their base currency will move in value when compared to other currencies. Traders who use a technical analysis strategy use charting software to identify patterns and changing trends before buying or selling their currencies.
Let’s take a look at a few examples of how you can use technical analysis to inform your trades. You can use these patterns and strategies to begin developing your own unique trading strategy.
The breakout strategy is commonly used during hours when the riyal shows little volatility. Traders use the breakout strategy to identify periods when the currency is moving sideways. When the currency produces a candlestick that “breaks out” of this predefined range of movements, a buy or sell order is triggered. A breakout candlestick often indicates that the currency will show a drastic movement, which can be bullish or bearish, depending on placement.
Reversal Candlestick Strategy
A reversal candlestick is an indicator that a currency will reverse whatever direction it’s currently moving when the candlestick is confirmed. A reversal candlestick can be bullish or bearish, depending on its placement, tail length and body. There are a number of different reversal candlesticks that you might see while trading and the strength of each candlestick may vary depending on its tail length.
Forex Trading Example in Oman
Let’s take a look at an example of how you might make money trading forex. Imagine that you deposit 10,000 riyals into your trading account. You believe that the value of the riyal is going to fall in comparison to the USD soon, so you decide to convert your entire lot of riyals into dollars. 1 OMR is currently equal to $2.6000 and your broker offers you 10:1 leverage on this trade. Using all of your leverage, you convert 100,000 riyals into $260,000 USD.
Soon, you see that your analysis was correct — the value of 1 OMR falls to only $2.550. You decide that now is the time to convert your entire lot back to OMR, which leaves you with 101,960 riyals. After returning your leverage to your broker, you’ve taken a total profit of 1,960 riyals on this trade.
Making Money with Forex in Oman
With a strong base currency and easy access to high-speed internet, Omani traders are at an advantage when forex trading. Though the number of forex traders residing or working in Oman is small, the market has greatly expanded in recent years as market regulations relax.
Currency trading in Oman is regulated by both the Capital Markets Authority and the Central Bank of Oman. Regulations require that customers’ trading funds be held in separate, secure accounts from the broker’s own funds. This means your money is secure even if your forex broker goes out of business. However, there are currently no limitations on leverage usage in Oman — local brokers may offer you up to 1,000:1 leverage. Using this much leverage can be exceptionally risky and quickly wipe out your profits with a single bad trade.
Though making money with forex is legal and possible in Oman, you should take steps to protect yourself and your capital. Only work with licensed brokers registered with the Capital Markets Authority and limit your leverage usage as much as possible.
Best Online Forex Brokers in Oman
Omani traders have access to a wide range of domestic and international forex brokers. Your choice of broker will determine which tools you have access to and which currencies you can buy and sell. Not sure where to begin? Start by exploring a few of our favorites below.
One of the first things you’ll notice when you start trading forex is that forex traders and brokers have their own set of terms they use to describe trades. Learning these terms before you begin trading can make it easier to learn. Familiarize yourself with a few of the most common forex terms below before you begin.
- Pip: A single pip is the smallest calculatable unit of currency, usually rounded to the 4th decimal place. For example, if the value of the dollar moves from $1.010 to $1.020 in relation to a certain currency, forex traders might say that the value has increased by 10 pips.
- Lot size: Your lot size is the number of units of currency that you want to buy or sell. For example, if you place an order to sell $10,000, you have a lot size of 10,000.
- Orders: An order is a set of instructions you give to your forex broker, who then executes the purchase or sale on your behalf. For example, you might place an order with your broker that says that you want to convert $10,000 into EUR at a price at or below $1 USD to 0.8800 EUR. There are multiple types of orders and you can use varying order types to limit your losses and maximize profits when trading.
- Calls: A call is a major risk of using leverage. If you use leverage to trade and the value of your account drops below a certain percentage of its original value, your broker may subject you to a margin call. After you receive a margin call, you’ll be required to deposit more money into your account or close out of your position. This can quickly wipe out any profits you’ve earned — be careful when you use leverage.
Maximizing Your Profits with Safe Trading
Though the forex market in Oman is regulated and enjoys a high level of oversight, forex scams still exist. Remember to do your research on any broker you choose to work with and ensure that you fully read and understand each broker’s fees before you open an account. Just a few days of research can help you maximize your profits by working with the best possible broker available to you.
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