The Forex is of course one of the most attractive financial markets at present because of the possibilities for profit that it offers during this economic crisis. But how is it possible to make profits on the foreign exchange market while minimizing risk as much as possible?  In this article we answer this question with explanations and information.

First of all, you should take great care when choosing the currency pair, you intend to invest in.  No doubt you have noticed that the majority of foreign exchange trading concerns the major currencies such as the American Dollar, the Euro, the Pound Sterling, the Yen and the Swiss Franc.

It is recommended that you avoid trading in the more exotic currencies in the beginning as they carry greater risk.  In fact, you may have trouble finding pertinent information on financial and economic events and news on these currencies and their liquidity is less than that of major currencies. Exotic currencies are therefore not recommended for beginner traders.

To maximize your chances of making profits it is recommended that you concentrate your efforts on the EUR/USD currency pair. This is the currency pair that is most traded throughout the world. This pair has the advantage of varying less than the other pairs which therefore means it carries less risk. In a single day it is exceptional that it varies by more than 1%. It is therefore the ideal pair for day trading.

Although the variations may be slight you can still accomplish substantial profits due to the leverage effect offered by the majority of Forex trading platforms. You should therefore take great care when choosing your broker according to this particular function. Only your decisions and your speculations on the markets will make a difference.

You should be able to correctly decipher the information that you find through the media. For example, if you hear of a rebound of the EUR/USD pair this does not mean that the Euro is rising but rather signifies that the Dollar is losing value. This information should therefore be checked and studied carefully concentrating more on the causes than the consequences.

To conclude, it is easy to make profits on the Forex as long as you take into account the exterior factors of the market which have an effect on the chosen currency pair. You should therefore make sure you are aware of economic events and news before investing and placing your orders.