Reviewed by Nick Cawley on December 16, 2021
Forex speculation is the name of the game in trading. Every trader, at some point or another, has to click ‘buy’ or ‘sell’ and commit to a position based on their analysis even though there is no guarantee of success. Unfortunately for traders, the market can have a very different viewpoint of the market and this can bring about a moment of serious introspection.
This article seeks to deal with some of those hard-hitting questions and explores the following:
- What is speculation in the foreign exchange market?
- What happens when it all goes wrong?
- Top 4 tips to speculate like a successful trader
What is speculation in the forex market?
Speculation in the foreign exchange market involves the buying and selling of currencies[1] with the view of making a profit. It is called speculation because of the uncertainty involved as no one can say for sure whether the market will be going up or down. Traders assess the likelihood of either scenario before placing a trade.
What happens when it all goes wrong?
After you’ve developed a trading strategy[2] centered around forex speculation and learned the basics of the market – you have many of the tools that are needed to be successful. And when that success doesn’t come, numerous questions can swirl around inside your head.
“Am I trading the right strategy?”, “Do I really know what I’m doing?”
These questions/doubts are not unique. Most traders have these thoughts at some stage or another and have learned how to overcome them. Let’s address these questions directly:
1) Am I Trading the Right Strategy?
Many traders don’t realize this early on – market conditions change over time. As a currency speculator, you can spend weeks analysing
