Forex can be extremely lucrative if you know how to work the market. Just like stocks, trading currencies requires you to know the ins and outs of each instrument you’re trading, in this case, currency pairs, how they behave, and why they do what they do.
All of these things imply that you have access to crucial information, such as live prices, news, and trends. Today we’ll focus on instrument price and how you can track it in real-time.
Why Is Real-Time Price Tracking Important?
Trading currencies on forex is similar to but also different from stock trading. For one, when you trade stocks, your reach is limited to a specific exchange. Your market opens and closes at a previously specified time. Forex is a whole different ball game. When you’re trading currencies on forex, you’re participating in a global market that never closes.
All instrument pairs are live 24/7 and subject to fluctuations. Depending on where you are in the world, you could very well be sleeping when significant news drops that create a potentially lucrative position. Forex is similar to crypto trading in this way.
Because of this inherent volatility of the market, being able to stay on top of instrument prices in real-time is essential. No matter what kind of trading you’re doing, scalping, day trading, or something else, you’ll need to have an insight into real-time instrument prices.
How to Track Live Currency Changes?
The ability for each trader, both on the retail and broker side of the house, to track currency changes in real-time is a fairly new concept. Prior to the proliferation of the internet and computers, trading currencies on global markets requires access to tools that weren’t so readily available.
These days, all you need is a smartphone, and you’re good to go. Tracking of currency pairs prices in real-time is done through forex charts and there are plenty of places where you can find these charts and access them for free. If you’re just setting up a trading strategy, you’ll need to have these tools readily available.
That being said, there is a caveat regarding online forex charts — not all of them are accurate. The idea is to find a chart provider who has the access to the most accurate live data you can find.
Mind you, we’re talking about small margins of error which are usually related to the timing of the currency price changes. Still, if you’re running a very tight scalping strategy that requires you to make quick changes to your positions, every moment matters. That being said, if you play your cards right, you might not have to take out that loan to purchase your first home!
Quick Reaction Time
Real-time forex trading is where an accurate chart is a must. When trading in real-time you are working against the usual market volatility, but also any news that might come up. The news issued by various governments and financial institutions is more than enough to upset the market and change the price of an instrument within seconds.
Since this type of trading means that you’ll be opening and closing positions extremely quickly, sometimes within seconds, having an accurate chart gives you a fighting chance. Real-time trading is considered high risk on a good day, but it’s borderline impossible to time the market volatility without a good chart.
Features and Scope of Information
Knowing the prices of each individual instrument is essential for trading. However, forex charts can offer much more information. Most traders use some sort of trading software on a daily basis. We’re talking brokerage platforms that allow you to make trades as a retail trader.
These platforms have their own forex charts, which are packed with all kinds of features. Executing a trading strategy requires you to have access to tools such as trading indicators. Combined with accurate real-time data, the use of indicators makes it possible to recognize short-term and long-term trends for an instrument pair you’re interested in.
Forex Charts Are a Tool
Accurate forex charts are crucial for any trading strategy, no matter how bold it is. However, it’s important to understand that these charts are just a tool that improves your chances of executing good trades. Make sure that you’re on top of your technical analysis and news feeds. Keep your ear to the ground and always have a finger on the pulse of instrument pairs you’re trading.
That is the only way to have a lucrative forex career and see a positive return on your investment. We hope that you’ve found this short guide helpful and that we’ve pointed you in the right direction!