What is the difference between Hawkish and Dovish sentiment regarding the US FED

Monetary policymakers in the United States are often classified as hawks or doves. The phrases designate contrasting theories about how monetary policy ought to affect the economy.

Several schools of thought on how monetary policy should affect the economy are reflected in these terms.

Conservatives, or “hawks,” are focused on keeping inflation low. Raising interest rates is a common strategy for controlling the money supply.

The goal of most “doves” is to get interest rates to drop. They advocate for a rise in the money supply, increased economic growth, and, above all else, more employment opportunities. The goal for investors and traders is to build a portfolio that is resilient against both types of monetary policy.

Here, we take a closer look at Hawkish versus Dovish policies.

The development of US monetary policy

The central bank’s dual mandate of price stability and full employment is the bedrock of the dove-hawk divide.

In order to achieve both aims, it is necessary to strike a balance between reducing the rate of inflation through monetary policy tightening (so that prices remain constant) and increasing the rate of interest (to ensure full employment).

To place more emphasis on the former is hawkish, whereas to place more emphasis on the latter is dovish.

The two terms are commonly used to refer to the 12 members of the Federal Open Market Committee who serve on the Federal Reserve System’s board of governors (FOMC).

The Federal Open Market Committee (FOMC) is the primary institution in charge of formulating monetary policy. Both hawks and doves can be found among the Fed’s officials.

There is more than one kind of politician in the world who makes policy decisions, not just hawks and doves. Centrists are officials who take a moderate stance, falling neither in the hawkish nor dovish camps. And hawks might flip to dovishness or vice versa depending on the situation.

After the financial crisis of 2008, the government adopted a highly dovish stance on monetary policy, maintaining interest rates around zero for years.

About 2015, policymakers became slightly more hawkish and began raising rates, in part to provide themselves room to cut rates in the case of another economic collapse. As a result of the COVID pandemic’s effect on the economy, central banks have recently become more dovish again.

A closer look at dovish policymakers

Rather than trying to slow the economy down, a dovish policymaker or politician would work to speed things up. This is accomplished by adopting a more accommodative monetary policy, one that is more likely to expand rather than contract the money supply.

The primary strategy of dovish policymakers in their pursuit of this objective is the reduction of interest rates.

It’s more affordable for people to use credit to buy things when interest rates are low. As a result, businesses are encouraged to increase their workforce and infrastructure to meet the rising demand.

When interest rates are reduced, it becomes more affordable for companies to take out loans to fund growth.

When the economy grows, it creates more opportunities for people to work, which in turn lowers the unemployment rate. Yet, rising prices and incomes are typically associated with an increasing economy.

This can set off an inflationary cycle, which can have the opposite effect of what was intended (reduced demand) if price increases outpace salary increases. The elderly and others on fixed incomes are particularly vulnerable to the negative effects of inflation.

A closer look at hawkish policymakers

The possibility of inflation is a primary concern for hawkish policymakers and their initiatives. By raising interest rates, cutting the money supply, and slowing economic development, they hope to prevent inflation from pushing up prices and wages.

When interest rates rise, it becomes more costly to borrow money, hence borrowers (including individuals and corporations) are less willing to do so. Constraining consumer spending and corporate hiring both help keep inflation in check and keep wages from rising too quickly.

Employment opportunities are less likely to expand under hawk rule, which can be particularly challenging for those who are actively seeking job. Those on fixed incomes, however, benefit from hawkish measures because their dollars retain more of their purchase power than they would in an inflationary climate.

In general, hawkish policies benefit both savers and lenders (who can enjoy higher interest rates). They lower the cost of importing goods and going on international trips.

Borrowers and domestic producers often feel the wrath of hawkish policies. Also, they raise prices for both international trade and local vacationing.

Advantages of hawkish policy

High interest rates can be beneficial to the economy, despite the fact that the term “hawk” is often used as a pejorative. They discourage people from taking out loans, but they encourage savings.

The reverse is also true; sometimes, when interest rates are higher, banks are more willing to lend money. Loans to applicants with less-than-perfect credit histories may be granted if interest rates are high enough to mitigate the banks’ perceived risk.

Also, if a country raises interest rates but its trading partners do not, import prices may decline.

Disadvantages of hawkish policy

In some cases, higher interest rates can have a deflationary effect, resulting in lower prices. Yet, while this may be beneficial in the near term, deflation is typically worse than low or moderate inflation.

As deflation continues, the value of a dollar increases over time. This encourages consumers to save up for the future, when the dollar will have more buying power but the prices would be higher.

A rise in interest rates causes people to delay large purchases made on credit. When mortgage rates rise, it tends to slow the housing market and can lead to a decline in home prices. Increases in interest rates for auto financing can have a similar impact on the car industry.

Increases in the cost of loans and bond interest rates are two ways in which hawkish policies can discourage borrowing and investment by businesses. It also makes businesses less likely to acquire new employees or invest in employee retraining.

Domestic production and exports may suffer as a result of hawkish measures. If domestic inflation is declining relative to that of a trade partner, then the domestic currency’s exchange rate should rise in order to maintain price parity.

When the value of a country’s currency rises, it lowers the price of imported goods relative to domestic ones. Domestic production suffers as a result, and domestic exports become relatively more expensive for international buyers.

Economic circumstances that give rise to either hawkish or dovish policies

Government monetary officials as a whole swing from hawkish to dovish when the economy shifts between growth and recession. For instance, a dovish reaction is typically implemented by central banks when the economy shows signs of entering a recession.

This entails loosening monetary policy, reducing interest rates, and boosting spending and employment. Contrarily, hawkish tendencies become more apparent if the economy has been growing for some time and inflation is rising.

This trend seeks to increase interest rates and tighten the money supply to slow the growth of prices and wages.

How to trade in either dovish or hawkish conditions

Understanding whether government leaders are hawkish or dovish requires close observation, and much experience is required to predict the expected implications of hawkishness and dovishness on investment.

Markets tend to react swiftly to announcements made by central banks, so keep an eye out for sudden shifts after such remarks.

Interest rate announcements (increases, cuts, or holds), discussion of economic growth metrics and projections, and announcements of future monetary policy shifts are all fair game for these types of public addresses.

When an important speech or announcement is made, news outlets all over the world immediately publish the details.

When interest rate shifts or economic growth information is announced, analysts and traders of foreign exchange pay extra attention to the tone and language of the statement.

Forex traders react more strongly when central bank activity and interest rate changes are not in accordance with current market expectations, just as the market does when other economic data or indicators are released.

Since central banks are becoming more open, it is easier to predict the future of monetary policy. But, central bankers could make a change in their outlook of either greater or lower scale than is currently anticipated.

Volatility in the market is high during these times, therefore traders need to be cautious about entering or expanding current trade positions.

Final Thoughts

Hawkish policymakers prioritise containing inflation as a top priority when formulating monetary policy. Policy-makers who adopt a Dovish stance prioritise economic growth and employment creation.

Interest rates are a tool that hawks and doves use to further their agendas. Hawks want higher interest rates because they reduce inflation, while doves favour lower rates because they encourage spending by individuals and investment in human capital and physical infrastructure by firms.

Many monetary policymakers are “on the fence,” displaying characteristics of both hawks and doves. The market’s extremes, however, often reveal people’s actual colours. Knowing the future of possible monetary policy shifts is crucial. The good news is that governments are become more adept at sharing information with the market.

Other Resources

Trading on Knowledge vs. Experience

Understanding Forex Trading Sessions

How the Silicon Valley Bank Collapse Affects Traders

How recent bank collapses affect traders

How Recent Bank Collapses Affect Traders

The failure of Silicon Valley Bank (SVB), a US-based banking company that catered primarily to the technology, life science, and venture capital industries, sent shockwaves through global financial markets.

A bank run of $42 billion was sparked when investors and depositors heard that SVB was in trouble. Silicon Valley Bank was closed by the California Department of Financial Protection and Innovation on March 10th.

The US government declared that it is taking extraordinary measures to ensure depositors get their money back. Meanwhile, HSBC bought out the UK branch of SVB.

Tim Mayopoulos started his new role as SVB’s CEO on March 13. When he arrived, his first order of business was to reassure customers that the bank will soon be open for business and accepting deposits once more.

He pleaded with VC firms and IT clients to restore SVB’s financial health by entrusting the bank with their money again. As Mayopoulos emphasised, the FDIC insures all deposits, both new and old, so depositors need not worry about losing their money.

Here, we will take a closer look at the SVB collapse and what this means for traders going forward.

A closer look at the collapse of SVB

The trouble began when the SVB Financial Group, which owns Silicon Valley Bank, released some unfavourable news. Silicon Valley Bank is a rather obscure bank outside of the tech startup scene (and most commonly known simply as SVB).

The tech industry went into a tailspin, but it also caused alarm in the retail banking sector of the United States, with ripple effects felt at the nation’s largest financial institutions.

Many investors are concerned about the state of the banking system as a whole in light of the Fed’s efforts to drain liquidity from the market, and the root reason of the crisis at SVB is still unclear.

When SVB’s parent company disclosed that it had sold $21 billion in securities from its portfolio, the issue surfaced, and it subsequently filed to sell $2.25 billion in shares to strengthen its capital position.

The resulting 60% drop in stock price had a domino effect on the financial sector as a whole. The reason for this was a sudden and significant decrease in bank deposits. Concurrently, SVB reduced its projected net profit.

The ripple effect

It wasn’t enough that too many depositors were pulling their money out of the bank; the situation quickly deteriorated when numerous venture capitalists did the same.

That group included prominently Peter Theil’s Founders Fund, which had previously asked its portfolio managers to reduce their holdings in SVB.

The action triggered what was essentially the beginning of a bank run. The company’s CEO called their biggest clients to reassure them and head off a mass exodus. Many venture capitalists have expressed their intention to maintain their current banking relationship.

Coincident with the SVB collapse was the unexpected shutdown of Silvergate Capital, which had significant holdings in cryptocurrencies. Only SVB, which is listed on the stock market, caters to the needs of Silicon Valley’s many tech startups.

Startups in the technology industry in particular have had a hard time attracting venture capital since interest rates have risen while actual rates have fallen due to inflation. That made SVB especially susceptible to the tech industry’s collapse as entrepreneurs withdrew funds to survive the rising cost of doing business.

This, in turn, was followed by trouble at Signature Bank.

Around USD 110 billion in assets and over USD 88 billion in deposits were reported to the New York Department of Financial Services.

Given that Signature Bank is the third regional bank to fail in the last two weeks following Silvergate Bank and SVB, many investors are worried that we may be heading back towards the financial crisis of 2007-2008. Investors are on high alert now, fearing broad financial vulnerability as a result of this.

Signature Bank’s stock price dropped about 25%, from USD 87 to USD 70, despite the bank’s publication of new financial statistics and limited crypto deposit levels on Thursday to improve diversity.

Customers of Signature Bank who expected the bank to fail shifted their money to more stable institutions like JPMorgan Chase and Citigroup.

The fate of the markets going forward

Runs on other banks with comparable lending and liquidity profiles may be triggered by the collapse of SVB and Signature Bank. The majority of depositors still worry despite efforts made by the Fed and The Treasury.

Foreign contagion, additional crypto market failures, and larger contamination of other financial markets are also possible outcomes. The world economy would suffer severely in the worst-case scenario.

Moreover, the collapse of SVB could leave a gap in the market for financing technology companies, prompting a retreat to traditional banks that are simpler but less likely to give bespoke funding.

Because of this, financial institutions may be compelled to liquidate assets at a loss in order to restore their balance sheets and maintain liquidity. The FDIC’s decision to exempt the two failing banks from systemic risk may have unintended consequences for the industry as a whole.

Since the SVB collapse, attention has been focused on private investments in technology. This fallout, for instance, may cause investors to pay closer attention to the investments of SoftBank Group Corp.

Japan’s SoftBank Group Corporation is a holding corporation that focuses on making investments in the electronics, energy, and finance industries.

SoftBank Vision Fund investors are worried about the safety of their investments in young companies. The price of SoftBank stock has dropped by 13%, passing below the 5,000 yen threshold that could prompt a repurchase announcement.

Several sectors of the tech industry may feel the effects of this chain of events differently. Startups may have to adjust their business strategies if getting finance becomes more difficult.

The collapse of Signature Bank is likely to prompt a closer look at banking laws, risk management measures, and collaborations with cryptocurrency firms.

Major cryptocurrencies like Bitcoin and Ethereum have already recovered, showing renewed confidence in decentralised assets, suggesting that the impact on the crypto market will be temporary.

Because it is a specialised bank with numerous unique tools, networks, and information, the closing of SVB will have far-reaching consequences, both in the near and long terms. The networking events hosted by SVB were essential in bringing together investors and business owners.

It turned around mortgage applications quickly, helped startup founders with advice and mentoring as they built their companies, made investments in new companies, and backed the VC firms that worked with them.

Traders and the option of safe haven assets

It’s common practise for investors to shift their holdings towards “safe-haven” assets during moments of market turbulence. It is possible for investors to better weather market fluctuations if they anticipate which assets will increase in value while others decrease.

In times of economic distress, it is common practise to put money into “safe-haven” assets like gold and government bonds. These assets are either uncorrelated with the economy or have a negative association with it, so they may increase in value during a market downturn.

Investors should consider the specifics of the current economic climate before deciding which safe haven to put their money in. This highlights the need of investors clearly articulating their objectives in the context of safe-haven investments.

The precious metal gold is often seen as a haven in times of market uncertainty. As a physical commodity whose supply cannot be altered by measures like printing (also known as quantitative easing), the price of gold is unaffected by interest rate choices made by central banks.

The example of gold’s use as a safe haven asset following the financial crisis of 2008 is instructive. In 2009, for instance, investment drove the price of gold up by more than 24 percent, and it has continued to rise consistently ever since, all the way into 2011.

Because of gold’s long history of serving as a currency backbone and a store of value, many people mistakenly assume that the desire to buy gold is driven by irrational ideas.

The traditional thinking is that investors flock to buy gold when they spot precursors to a large market catastrophe, as the precious metal has a history of acting as a safe haven. Holding gold as a safe haven investment has become a self-fulfilling prophecy.

Your exposure to market volatility can be lowered and your wealth protected with an investment in a safe haven asset. When the market is falling, the value of safe haven assets tends to rise relative to that of other markets.

Knowing which assets are considered safe havens in the case of a financial crisis is essential for investors.

They can then use the most appropriate risk management strategy, such as selling long positions or buying short ones, in anticipation of the price movement of other assets that are declining in value.

Final Thoughts

Events like stock market bubbles, crashes, and economic recessions can have long-lasting, negative consequences on an investor’s portfolio value.

A market slump is a natural and inevitable aspect of the market cycle, therefore it’s best for investors to take as many safety measures as they can to prepare for it, such as the one which may arise from the recent banking collapse.

During economic downturns, safe-haven assets tend to outperform the broader markets.

Other Resources

Trading on Knowledge vs. Experience

Understanding Forex Trading Sessions

Hawkish vs Dovish Monetary Policies

Trading on Knowledge vs. Experience

Trading on Knowlegde vs Experience (Khwezi FI)

Trading on knowledge vs. experience

Trading is like any other skill in life, experience is everything

These days, thanks to the internet, anyone may try their hand at trading currency pairs on the vast and volatile Forex market. But it doesn’t mean you should go out and put all your money into this potentially risky trading opportunity just yet. Learning to trade Forex is like any other skill set, which can be learned with time. In order to succeed at Forex trading, knowledge is key.

Here we take a closer look at the difference between skill and knowledge, and show you how it is applied in Forex trading.

The difference between skill and knowledge

Knowledge is the intellectual grasp of information, the possession of the correct responses.

Skills are useful in everyday life. These are the steps that individuals take to apply the knowledge which they have learned.

This is the key difference between knowledge and skills.

All of your Forex training should result in newfound knowledge. After completing a course, students should have a firm grasp of the material. Plus, you’d like it to develop even further. After completing a training programme, you should see measurable improvements in performance that correlate with your overall trading objectives.

The importance of gaining knowledge through Forex education

In the Forex market, some traders fail because they try to run before they can even walk. In spite of your enthusiasm, diving headfirst into Forex trading is not a good strategy.

Trading foreign currencies (Forex) requires knowledge just like any other career. The best way to prepare a trader for the real world is through a combination of knowledge learning and real-market skills development.

Do you ever ponder the reason why accountants earn more than minimum wage workers? Why are doctors paid so much more than these accountants, anyway?

How much money you make in a career depends on how much time and effort you put into learning the skills required to do that job. And to develop those skills, you need to have the knowledge of the system in which those skills are learned.

A good Forex trader can sort through mountains of information quickly. Then, he or she can quickly examine the data, find patterns, and act accordingly. Doing so requires a certain level of expertise. It is a talent that requires time and effort to cultivate, and then further practise to perfect.

Forex trading is not a “something for nothing” deal, despite what certain shady online resources might have you believe. Financial success is possible for those who trade in foreign exchange. However, that comes after they have spent countless hours gaining market knowledge, honing their skills, and developing trading strategies.

So, it is crucial for a Forex trading newbie to make an investment in Forex courses and education. This is an investment, not a cost. It will yield substantial benefits in the long run thanks to your hard work and newfound expertise.

Start with the basics

Beginner traders can benefit from taking a Forex course because it teaches them the fundamentals of the market. The foreign exchange market (Forex) has its own jargon.

The uninitiated may be confused by terms like “lot,” “pip,” and “strike price.” Yet they are quite helpful for the Forex trader. With these terms, you can say a lot with relatively few words.

In addition to learning the terminology, a beginner’s course in Forex will also teach you some simple mathematics, such as how to convert an indirect quote into a direct one.

Without this foundational understanding, you cannot succeed in trading. It is up to the trader to decide whether or not they would like to learn Forex trading in one comprehensive course or by ad hoc internet research.

Learn how to interpret macro developments

Global and economic events are covered by the macro news. This type of news is known as “macro news” since it covers widespread occurrences.

The foreign exchange market reacts strongly to news of this nature. As the government reports changes to macroeconomic indices like inflation or unemployment, the value of a currency might rise or fall.

Massive volatility guarantees that prices will reach irrational highs or lows, giving traders the chance to make a killing. However, this requires the trader to have a stake in the underlying currency and anticipate the magnitude of any price change that may result from the macro news.

This calls for a comprehensive knowledge of macroeconomics, which is often imparted to Forex traders through a dedicated educational programme.

Learn how to create your own trading strategy

A “guaranteed system” that promises risk-free returns is a myth in Forex trading. Instead, a strategy will provide a broad framework of rules to follow as you ride out the market’s ups and downs.

A trader can save the hassle and cost of developing this method from beginning. Academics have studied the topic of what works and what doesn’t in Forex trading at length. By learning about these established trading strategies, a Forex trader can construct a relatively advanced strategy with less time spent learning the ropes.

Skills to apply to Forex trading

Once you have taken the time to gain the sufficient trading knowledge, you can use this insight to apply certain skills to your daily Forex trading. Here are some of the best skills to apply to Forex trading.

Develop an analytical mind

The stock market is a numbers game. No matter where you go, you won’t be able to escape them. If you want to succeed as a trader, you need to develop the ability to read and interpret data fast.

A lot of work can be saved by using automated methods to convert data into visual representations. But, analytical skills are still required to sift through these and discern market trends and patterns.

Your ability to quickly analyse currency pairs and calculate prospective gains and losses depends on your proficiency with mathematics and analysis. You’ll be in a better position to decide how much to invest in the trade.

Hence, you’ll need a sharp, analytical mind to grasp various trading techniques and develop your own successful approach. The more quickly and easily you can understand the information, the better you’ll be able to translate the numbers into currency values.

Become good at keeping records

Training your analytical abilities will require data, and lots of it. All of the information must be correct, comprehensive, and safely stored. The trader must keep detailed records and be diligent to do this.

To get a handle on your trades, you need to keep meticulous records of everything you do. Using this tool, you may look back and see how your trading strategy performed in the past.

The information gathered can show you where there are gaps in your strategy and where there are opportunities in the market, both of which can lead to increased profits.

In the volatile foreign exchange market, situations can deteriorate rapidly. Before you completely lose your bearings, make sure you keep up with your data.

Learn to be disciplined

Lack of self-control will render useless even the most well-thought-out trading plan. If you’re having a rough day on the markets this is extremely crucial. In the midst of confusion, discipline can help you stay on course.

One’s integrity can be preserved through the use of a trading log. It displays whether or not you had the self-control to stick to the strategy even when things were tough.

Have a strong mental game

Experienced traders know how taxing the foreign exchange market’s frequent swings can be. It’s like running a marathon without training.

In the event that you believe things are escalating out of your control, take a step back. There’s no shame in taking a break from the market to collect your thoughts.

One of the best ways to prepare oneself mentally for the challenges of today’s market is to practise meditation. It helps you relax and concentrate at the same time.

Learn how to stay calm

It goes without saying that forex traders need to keep their cool when the market is wildly fluctuating.

If you give in to your feelings, you might make rash choices that end up costing you more. Making use of your emotions on the trading floor is a recipe for disaster, thus it is important to set entry and exit levels in advance. Then, use them as a map to avoid making rash trading decisions.

Cultivate a patient approach

The ability to wait patiently for the price to reach your entry and exit targets is essential after you have established them.

Have the resolve to see things through, no matter how bleak the market looks.

To accurately forecast the future value of a currency requires an extraordinary level of knowledge and experience, neither of which the average person possesses.

You need to be patient and willing to stick to your trading strategy, no matter what comes your way. Have an open mind. Improve as much as possible. Regularly evaluate your trading approach and make adjustments as needed. There is a need for patience in order to achieve a system that is resilient.

Other Resources:

Trade Safe Haven Assets (Focused on Dollar & Gold)

Forex Brokers with the Best Customer Service

MetaTrader 4 versus MetaTrader 5

Trade Safe Haven Assets in Volatile Times

Safe Haven Assets in Volatile Times

A Look at Dollar and Gold

During periods of market volatility, investors often turn to safe-haven assets as a way to reduce their overall risk. To better weather market swings, investors can plan ahead by determining which assets will rise in value while others fall.

A safe-haven asset is a type of investment that usually holds or even increases in value when the economy is in a bad spot. In the case of a market recessions, these assets may rise in value since they are either uncorrelated with the economy or negatively associated with it.

It is up to investors to determine which safe haven is best for the current economic scenario, as not all safe havens will share these features. Because of this, investors need to know exactly what they hope to gain from safe-haven assets before making any decisions.

In this article, we take a closer look at two of the most popular safe haven assets amongst investors – namely gold and the dollar – and show you how to trade with safe haven assets.

The dollar as a safe have asset

During times of economic uncertainty, the US dollar has been one of the most widely used safe haven assets for almost 50 years. It has many features that make it a safe haven, the most important of which is that it is the most actively traded currency in the foreign exchange market. The 1944 Bretton Woods agreement established the fixed currency system and established the US dollar as the world’s principal reserve currency, establishing its credibility in the eyes of the investing public. The US dollar continued to be seen as a safe haven even after the system was disbanded since it represented the strongest economy in the world.

Although many predicted that increasing volatility due to US President Donald Trump’s contentious politics would hurt the dollar’s standing as a safe-haven, it appears that the currency is still benefiting from safe-haven flows.

The US Dollar Index, for instance, rose by 5.29% between January and August of 2018, despite trade tensions’ impact on financial markets and commodities generally.

Gold as a safe haven asset

Gold is commonly associated with the concept of a safe haven. Gold’s price is unaffected by interest rate decisions made by central banks because it is a tangible good, and its supply cannot be artificially increased or decreased by means such as printing, a policy also known as quantitative easing.

Gold’s role as a safe haven asset after the 2008 financial crisis is illustrative. As an example, gold’s price increased by over 24 percent in 2009 due to an increase in investment, and it has continued to rise steadily since then, all the way into 2011.

Gold’s historical role in supporting currencies and as a store of value has led many to conclude that the decision to purchase gold is influenced by irrational beliefs.

According to the conventional wisdom, when investors see warning indications of a major market crash, they rush to buy gold because of its reputation as a haven in times of uncertainty. Investing in gold as a haven has turned into a self-fulfilling prophecy.

What makes an asset safe in times of market volatility?

An investment in a safe haven can reduce overall portfolio risk and protect you from market fluctuations. Safe haven assets typically do better than other markets during market downturns.

Many of the features of safe haven investments are the same:

High liquidity
Stable demand
Relevance and assurance that it won’t be replaced
Expected to retain or rise in value during times of economic turmoil

In the event of a financial crisis, it is crucial for investors to know which assets are viewed as safe havens.

This allows them to better anticipate the price movement of other decreasing assets and employ the most appropriate risk management technique, such as closing long holdings or initiating short ones.

Negative effects on an investor’s portfolio value from events like stock market bubbles, crashes, and economic recessions can persist for years.

How to trade safe haven assets

The wisest course of action for any investor is to take as many precautions as possible to ensure that they are ready for a market downturn, which is a normal and expected part of the market cycle.

Safe-haven investments typically outperform the bulk of markets during times of financial crisis.

Traders need to be able to recognise safe-haven assets and use this knowledge to foresee price fluctuations and apply their own strategies, even though investors often utilise safe havens to shield their portfolio’s value.

You may want to consider closing out any open long positions or opening new short ones if you anticipate a dramatic decrease in the market price as investors flee ‘riskier’ assets for safer ones.

Yet, you might benefit from price increases if you are confident in your ability to determine which assets will serve as safe havens in the near future.

Safe-haven asset trading patterns are very subjective and cannot be predicted. In order to profit from price changes or hedge against price declines, knowing how the market feels about safe-havens at any given time is essential.

Trading gold and the dollar

The European economy shifted its minting system from silver to gold between the thirteenth and fourteenth century.

This evolved as people realised that gold’s intrinsic durability and appeal made it a more reliable standard for establishing the prices of items in exchange.

The agreement to peg the world’s currencies to the dollar has heightened the importance of the inverse relationship between gold and the dollar.

The price of gold is a barometer of the health of the US economy; a rise in gold prices indicates economic distress.

When gold prices are low, however, other investments like equities, bonds, or even real estate tend to do better.

Investors acquire gold as a hedge against economic crises and inflation, with the gold price serving as a barometer for economic success.

Traders’ faith in the commodities market is reflected in the gold price, making it a credible barometer of market sentiment.

To hedge their bets against a possible economic downturn, these investors will buy more gold, and vice versa when times are good.

A stock market correction occurred in 2016 in the United States as an illustration of this mechanism in action. Gold prices increased as the Dow Jones Industrial Averages declined.

When the market looks hazardous, gold is a safe haven.

The wartime suspension of the Gold Standard eroded faith in that system and prompted calls for a more malleable currency.

As the world economy expanded and the gold supply shrank, the British pound and the American dollar rose to prominence as the world’s reserve currency.

In turn, the dollar may be exchanged for gold at a set rate of $35 per ounce. Although the dollar is currently only tied to gold through indirection, the global financial system still operates on a gold standard.

Given that the United States maintains significant trading relationships with countries in Asia, Europe, and North and Central America, the dollar continues to enjoy safe-haven status.

Nonetheless, the United States still has not entirely recovered from the past economic calamity, as seen by persistently high unemployment rates (approaching 10%) and sluggish economic growth (which has persisted for a considerable while).

And the fact that investors can trust the United States Treasury to make good on their investments is what gives the US dollar its status as a safe haven currency. Investors fleeing the last financial crisis flocked to US Treasuries and the US dollar.

Treasury bills and notes are examples of government bonds. They are effectively a “I owe you” from the government with a defined maturity date and interest payments.

The only distinction between the two is the length of time you’ll have to wait to get your money back in full. In contrast to government bonds, which might have maturities of ten years or more, treasury bills mature in one year or less.

Government bonds from developed economies are more trusted by investors; US treasury bills are the most widely held of these bonds.

Their status as a safe haven stems from the United States’ stellar credit rating and the excellent quality of income denominated in US dollars. Investors view government bonds as a risk-free safe haven because of the consistent income they generate and the guarantee of full repayment upon the bonds’ maturity.

Final Thoughts

During times of market instability, the aforementioned assets’ values may fluctuate. Also, the definition of a safe haven evolves throughout time.

Even if an entire economic sector is doing poorly, the stock of one company operating inside that area that is doing well may be seen as a safe haven.

Investors wishing to put their money in safe havens would be well to complete their research ahead of time, as an asset that is viewed as such during a market slump may not be such a good investment during a market upturn.

That said, the dollar, and gold in particular, have shown dependable longevity as safe haven assets.

Other Resources

Trading on Knowledge vs. Experience

Understanding Forex Trading Sessions

How to join Khwezi Trade’s Affiliate Program

Understanding Forex Trading Sessions

The foreign currency market is unique since it operates 24/7. With the advent of 24/7 trading, investors can now place trades at any time of the day or night, regardless of their time zone. However, when it comes to foreign exchange trading, not every time of day is made equal.

There is always a market for the most liquid asset class there is, forex, however there are times when price activity is continuously volatile and times when it is quiet.

Furthermore, different currency pairs display varying activity during specific times of the trading day due to the overall demography of those market players who are online at the time.

This article will discuss the three main trading sessions, discuss the types of market activity that may be expected during each session, and demonstrate how this information can be incorporated into a trading strategy.

How the 24-hour Forex market works

Many institutional and individual traders benefit greatly from a 24-hour forex market since it ensures liquidity and allows them to trade at any time of the day or night. Although currency trading is possible around the clock, a single trader can only keep tabs on a position for so long.

Since most traders can’t monitor the market around the clock, they’ll miss opportunities occasionally, and may even see their positions eroded by a sudden spike in volatility that occurs when they’re not available to protect them.

Since market volatility can affect any trader’s profits or losses, it’s important for traders to recognise periods of high and low volatility and adjust their trading accordingly.

Market activity often peaks during the Asian, European, and North American sessions (also known as the Tokyo, London, and New York sessions, respectively). These terms are used interchangeably because all three cities are considered to be regional financial hubs.

Most banks and enterprises in the respective regions perform their daily transactions, and there is also a bigger concentration of speculators online, while these three super-economies are open for business.

The Asian Session

Whenever the foreign exchange (FX) market regains its footing at the start of the week, all eyes are naturally drawn to the Asian markets. Unofficially, this region is represented by the Tokyo capital markets between the hours of midnight and six in the morning (GMT).

Notable countries including China, Australia, New Zealand, and Russia are also present throughout this time. Because of the dispersed nature of these markets, the start and finish of the Asian session naturally extend over the typical Tokyo hours.

As a result of the time zone difference, the Asian market is typically considered to be open between the hours of 11 p.m. and 8 a.m. GMT. You can learn more about the Asia Session here.

The European Session

Just when the Asian trading hours are winding down, the European session begins its activity. Many of the world’s most important financial centres are concentrated in this FX time zone. To date, London has been tasked with setting the terms for the European session.

The existence of other capital markets (such as Germany and France) before the formal open in the U.K. additionally lengthens the trading period, while volatility persists until after the close, delaying the session’s completion. As such, the standard European workday begins at 7 a.m. and ends at 4 p.m. GMT.

The North American Session

By the time the North American session begins, the Asian markets will have been shut for several hours, while European traders will just be halfway through their day.

The United States, Canada, Mexico, and South American countries all participate in the North American session, although the United States is the session’s undisputed leader. Consequently, it is not surprising that the session’s highest volatility and highest participation rate may be seen in New York City.

How to trade the different Forex Sessions

North American hours effectively begin at 12 p.m. GMT due to the high volume of economic data releases and early trading in financial futures and commodities.

Since there is a significant lull in liquidity between when the U.S. markets close and when the Asian trading session begins, trading in New York is said to end at 8 p.m. GMT when the North American session ends.

There is typically higher trading activity during the overlapping Asian and European sessions, which can lead to greater volatility.

There will be a greater reaction to the Asian/European session overlaps and a less dramatic increase in price action during the European/U.S. sessions’ concurrence if the currency pair is comprised of cross currencies that are most actively traded during Asian and European hours (like EUR/JPY and GBP/JPY).

Regardless of the session in which the pair or its components are trading, the presence of scheduled event risk for each currency will still have a considerable influence on activity.

Trying to enter a trade during a currency pair’s most active hours can result in a bad entry price, missing the transaction entirely, or making a trade against the rules of a long-term or fundamental trading strategy.

Traders who don’t intend to hold positions overnight, on the other hand, depend heavily on volatility.

One of the first things a trader must do when dealing in foreign exchange is to decide whether high or low volatility is more suited to their trading approach. If you’re looking for significant price movement, trading during session overlaps or normal economic release times may be your best bet.

Once a volatility bias has been established, the optimal trading hours can be determined. The next step for a trader is to learn the time frames that see the most action for their chosen currency pair.

5-3-1: A strategy for trading the different Forex Sessions

Foreign exchange (FX) traders can use the tried-and-true 5-3-1 trading strategy as a simple framework from which to build the most effective trading approach according to their individual needs and preferences. Since there are so many currency pairs to choose from and since trading occurs around the clock, the 5-3-1 method is very useful for novice traders.

Here’s how it works:

1. Choose 5 major currency pairs

Only five major currency pairings should be your primary focus when employing the 5-3-1 trading method. Pick currency combinations based on the one or two major currencies you have the most experience with.

We’ll get to the phase of the method where you choose your pairs based on their busiest trading times in a little.

You can learn a lot about the behaviour of pairings by concentrating on only five of them.

2. Use 3 primary trading strategies

The next step is to settle on no more than three distinct trading strategies. Any combination of trading approach and technical analysis indicators above this cap will result in reduced profitability.

By narrowing your trading plan to only three techniques, you may do technical analysis using only the timeframes and indicators that are most relevant to your trading style.

It also prevents you from getting confused by employing too many indicators, which can lead to confusion if they start to contradict each other and show confusing signals.

3. Trade at 1 session each day

The 5-3-1 method advocates for a single daily trading window. The fact that the Forex markets operates around the clock is a major selling point. All-hours trading provides access to a large pool of buyers and sellers at any time of day.

In contrast, if you don’t check in on your trading account regularly, you risk missing out on profitable trades or being caught off guard by unanticipated market fluctuations.

The best time to trade depends on the activity level of the currency pairs you intend to trade. The foreign exchange market is typically broken up into three sessions: Tokyo, London, and New York. You can probably tell just by looking at the titles of the pairs which currencies are the most actively traded during each session.

The third element of this strategy is to choose how often you will check in on your deals. However, this is also the most important time for you to put your trading plans into action. You will be unable to follow your trading plan if you log in to trade a currency that has low liquidity at that moment.

Final Thoughts

You, as a trader, must decide when is ideal to enter or exit a market. In terms of trading styles, time zones, and your own availability. For example, the Asian trading session is ideal if you want to aim for a small number of pips in a somewhat stable market.

If you’re looking for large price swings and significant volatility, though, the London session and the New York open hours are your best bet.

However, if you’re free to trade whenever you like, experts agree that the overlap of trading sessions is the greatest time to make transactions. Trading occurs when people from all around the world’s financial hubs are present. There is adequate volatility, and numerous assets can be traded with ample liquidity and tight spreads.

More Resources:

Forex Trading Webinars and Training Material

Forex Brokers with the Best Customer Service

Brokers that Allow You to Trade News Releases

Forex Trading webinars and training material

Learning the fundamentals of forex trading, becoming familiar with a variety of methods, and developing a solid grasp of the psychology of trading are all greatly aided by a solid education in the currency market.

That’s why educational resources like forex trading webinars exist to begin with. Most brokers that offer free educational resources for their customers also host free webinars. Clients benefit greatly from the webinars because of the information they provide on forex trading.

Through visual demonstration and coaching from industry leaders, they aid traders in locating a wealth of solutions to crucial queries. The great thing about webinars is that anyone, regardless of where they happen to be, may participate. Moreover, there is a wide range of topics covered in free webinars, making them potentially useful for both novice and seasoned traders.

The majority of these courses are self-paced and feature resources including video lectures, webinars, simulated trading platforms, discussion forums, and one-on-one guidance from instructors.

When they feel comfortable doing so, students can put their newly acquired information to use in actual trading.

With this in mind, we explore the best Forex webinars and trading materials offered by leading, regulated Forex brokers.

1. Khwezi Trade Free Forex Education

For anyone interested in learning the fundamentals of foreign exchange trading, Khwezi provides free education.

Risk management, trend and channel analysis, and indicator use are just some of the fundamentals that that the broker’s educational courses are meant to instil in any trader.

Khwezi understands that anyone can learn to trade the Forex market successfully with the correct training and instruction, and so offer a tiered course for beginner, intermediate and advanced Forex traders.

The beginner Forex course from Khwezi Trade includes such pertinent topics as risk management, trend analysis and SR & RIB. Once these fundamental concepts have been covered, traders can then move on to the intermediate course.

Here, intermediate traders will learn how to analyse trendlines, channels and breakout trading, showing students how to draw trendlines, as well as the immensely rewarding breakout trading strategy.

The advanced Forex trading course covers stochastic oscillators, of which there are hundreds available on the Khwezi Trade platform, as well as the MACD oscillator, which gives traders greater insight into the overall strength of a particular trend.

Khwezi Trade also provides a fantastic selection of video tutorials, which include technical information on using the MT4 platform, trading basics, introductions to Forex trading and Forex analysis, candle patterns, risk management and more.

2. ForexSignals.com

The seven-day trial at ForexSignals.com is just the icing on the cake of a comprehensive package that also includes a thorough instructional course, access to expert trading tools, and continuing professional guidance.

ForexSignals.com’s mission is to educate its clientele in the art of currency trading via the website’s exclusive trend-analysis and signal-generation methodology. Professional traders who trade using the same information they teach with reinforce both the knowledge and instruction they provide.

Beginning traders should start with the Trading Academy’s training courses taught by seasoned professionals in the Forex market. More than three hundred and fifty clips are available. The material begins with an introduction to trading and progresses into more advanced, technical topics.

The Trading Room serves as a chat room where students can discuss and demonstrate their trading techniques, helping to reinforce their education.

Also, students can watch live streams of professional traders’ sessions to learn from their strategies and tactics. Members can use our Profit Calculator and Monte Carlo Simulator, two of our exclusive trading tools.

3. Traders Academy Club

TAC was created by Vladimir Ribakov, a licenced financial technician recognised worldwide, to serve as a comprehensive resource for investors of all skill levels.

The Media Zone provides students with access to hundreds of recorded webinars suitable for both novice and seasoned traders. Live Trading Room recordings are included, as well as recordings of trading simulations and analysis videos.

Vladimir, the instructor, is available around the clock to answer students’ questions and the chat room is always bustling with activity. Weekly live webinars are also provided.

The daily online viewing of live trading sessions is the most well-liked part of the training. Students receive Forex indications and in-depth analysis during the sessions, with each trade recommendation dissected in great detail.

4. Asia Forex Mentor

Asia Forex Mentor’s website boasts many grand promises from the company’s creator, but we found consensus on one: his course is one of the most comprehensive option for learning Forex.

There are 26 comprehensive classes in total, each with more than 60 individual topics covered in high-quality internet videos shot in a professional studio. Ezekiel has carefully selected examples and provided his own views for each session.

The Golden Eye Group is another great private programme that members have access to for a fee. Insiders can watch live streaming of Ezekiel’s weekly market analysis, in which he explains and interprets trading setups and shares his trading strategies.

5. Daily Forex Academy

An internationally renowned expert in the foreign exchange market (FX) conceived and funded the development of FX Academy, which features content produced by some of the industry’s most respected traders and is available at no cost to traders of any skill level.

Established in 2016, FX Academy is an initiative of DailyForex.com, a reputable and authoritative Forex website that has been publishing daily Forex news and analysis since 2006.

The aim of FX Academy is to equip traders of all experience levels with the knowledge and tools they need to succeed in the Forex market.

There are 15 different courses available at FX Academy, covering everything from an introduction to forex to advanced trading strategies. An animated film, some reading, and several tests make up each lesson. Students can work through the material at their own leisure, as the course is self-paced.

The organisation also offers Strategy Simulations, which replicate real-world market scenarios and trading scenarios so that students can learn by doing.

FX Academy’s library of instructional resources and trading tools is available to you at no cost. Your time is the only thing required of you. However, you won’t get the personalised attention from a tutor or the ability to practise in a real-time trading room that you would in a paid course.

6. Six Figure Capital

Six Figure Capital’s 14-day course packs a large amount of information into its material without overwhelming you, making it ideal for beginner to intermediate traders who seek a total immersion experience in learning to trade.

Participants of the 14-day course can expect to master the basics of trading as well as advanced strategies in a condensed time frame. There are 19 films total, one for each day of the two-week period.

To help students learn by doing, the course incorporates live trading sessions. Also included are supplementary resources like electronic books and Excel spreadsheets.

Six Figure Capital also provides a Slack channel where novice and seasoned traders can talk to one another and share their thoughts and findings.

In order to learn how to trade with Six Figure’s unique harmonic pattern software, students must first finish the 14-day foundational course. The 14-day programme automatically includes this class.

Both payment options grant students unlimited access to all available courses and resources forever, as well as free lifetime updates and customer service.

Why Forex education matters

Before investing time, energy, and money into online forex trading, it’s crucial for new traders to have a firm grasp on the basics of what it entails. Trading foreign exchange (Forex) online is the practise of executing trades in currency pairs via an online forex broker.

Forex tradinf refers to the practise of buying and selling a currency pair for the purpose of making a profit from fluctuations in exchange rates. Exchange rate fluctuations are the source of Forex trading’s profit potential.

Since there is no centralised market for currency, all transactions take place electronically, over-the-counter, through our website or mobile app. Trading is available 24 hours a day, 5 days a week.

If you want to trade professionally, you should probably enrol in a solid Forex trading course. Before spending a lot of money on a trading school, you can get more out of your time by taking advantage of one of the many free online courses available to get you up to speed, such as those available from Khwezi Trade.

Is Forex trading for me?

People interested in making extra money at home find forex to be appealing.

Forex trading has several benefits, including cheap capital requirements and simplicity of entry into the market, for those who are ready and able to dedicate themselves to studying the ins and outs of it. It does provide the chance to make money, either part-time or as a career, for those with a strong knowledge base and the capacity to control their emotions.

You might be a good fit for Forex trading if you have the necessary education and expertise, as well as the perseverance and self-control to learn from your failures.

However, forex trading might become a losing nightmare if you don’t have the time or desire to dedicate to a rigorous learning process.

More Resources:

Understanding Forex Trading Sessions

Forex Brokers with the Best Customer Service

Brokers that Allow You to Trade News Releases

Forex Brokers with the best customer service

Investors may quickly get a sense of the relative merits of different brokers by comparing their costs, the types of assets they offer, the accessibility of their trading platforms, and the convenience of their various deposit and withdrawal options.

These are all crucial factors to think about, but it’s also important to select forex brokers with excellent customer service. In practise, customer service is equally crucial, if not more so, than these other factors. Khwezi gets a very high score on all these factors.

When trading, problems can arise, and you need to be able to get in touch with customer service as soon as possible. A reliable broker will provide you with multiple ways to get in touch with them.

Also, they need to be available whenever you have questions or concerns; many assets remain active even on weekends, so you can’t afford to be waiting around for a response. A more positive trading experience can be had when dealing with a broker who is quick to respond to any questions or concerns.

How to compare customer service from a Forex broker

Operational hours

A few brokers may only be available during the week, while others may be available 24/7. Clients trading assets and markets that are open on the weekends, like cryptocurrencies, benefit greatly from 24/7 service because they can swiftly resolve any concerns that could result in financial loss. But this isn’t the last word either.

Round-the-clock customer service may not be worth much if all the assets you trade (forex, equities, ETFs) are closed on weekends.

Customer service experience

The best Forex brokers will employ support staff members who are experts in their field. If your customer support team is well-versed with the company’s inner workings, the financial markets, and the services on offer, they should be able to help you out whenever you run into any issues.

Multilingual support

The amount of languages offered should also be considered, especially if you have a global clientele. The broker must be able to effectively assist customers in all of the places in which they do business.

If you want to make things easier and less frustrating for yourself, you shouldn’t have to worry about understanding what’s being said.

Available contact methods

The finest brokers in terms of customer service will give you multiple ways to get in touch with them.

There needs to be a balance between passive and interactive approaches. People who are already pressed for time at work can react to customer care communications at their convenience via non-intrusive channels including email, text, and online contact forms.

It’s also helpful to have the option of real-time communication like phone calls and online chats. As information and data can be gained from live chats, this is especially helpful when the issue is not clearly stated, allowing customer care to more easily resolve the issue.

Forex brokers with the best customer service

1. Khwezi Trade

Khwezi Trade, founded in 2013, is a South African broker authorised by the Financial Sector Conduct Authority (FSCA) as an FSP and ODP that offers low deposit ZAR accounts and fast trade execution.

When compared to competing brokers, Khwezi Trade’s customer service is second to none, offering South African traders with friendly, professional and multilingual support.

From Monday through Friday, 7 a.m. to 6 p.m., Khwezi Trade offers email, phone, and call-back services for its customers. Apart from offering a live chat option, questions are also handled via email. Five official languages are supported (that’s English, Afrikaans, Zulu, Sotho, and Xhosa) should you need any assistance.

Khwezi Trade provides exceptional service to its customers by promptly responding to their inquiries and providing them with a highly customised trading experience.

With a minimum deposit of 500 ZAR and spreads starting at 0.7 pips on the EUR/USD, beginners can open a commission-free ZAR account with Khwezi Trade.

There is a low minimum deposit of 50 USD required for its USD account, and spreads on the EUR/USD go as low as 0.1 pips with no commissions. Both new and seasoned traders can benefit from the assistance of a dedicated account manager, no matter which type of account they choose.

In sum, Khwezi Trade is a good option for South African traders searching for an MT5 broker because of its inexpensive trading expenses, personalised customer service, and ZAR trading accounts.

2. AvaTrade

When compared to other brokers, AvaTrade’s customer support stands out as particularly helpful.

Help is available around the clock for bitcoin and CFD trading. There is a local South African phone number, as well as international and multilingual email and chat support.

For good reason, AvaTrade is considered among the world’s top brokers. It provides numerous trading venues, such as the acclaimed AvaTradeGO mobile trading software.

Trading Central is only one of many powerful trading tools available, and the site’s analytical and educational resources are among the best in the industry.

As a broker, AvaTrade’s fees aren’t the lowest available, but most traders will find them to be within a reasonable range.

3. Pepperstone

Pepperstone, an Australian broker that debuted in 2010, is widely recognised for its competitive trading fees and wide selection of supported platforms.

Although not the most comprehensive, Pepperstone’s education section is nonetheless a decent place to start for novice traders thanks to its professionalism and organisation.

If you have any issues about your account or trading, you can contact Pepperstone’s award-winning customer care team at any time.

Pepperstone is a trustworthy Forex broker due to their extensive list of accolades, international clientele, and regulation by some of the world’s most stringent authorities (among them the Financial Conduct Authority and the Australian Securities and Investments Commission).

4. Forex.com

Forex.com was established in 2001 and is a well-regulated broker with minimal fees and high minimum deposits, making it ideal for both novice and seasoned traders.

Customer service is available via phone, email, and live chat around the clock (from 10 a.m. to 5 p.m. Eastern Time, Sunday through Friday) like with most brokers.

Although English is the default language for customer service, support in Arabic, Ukrainian, Polish, Russian, and Chinese is also accessible. The Forex.com staff encourages participation on social media, so you can connect with them there as well (through Facebook and Twitter).

5. IG Group

Founded in 1974 and regulated by the FSCA since 2021, IG is known for its extensive list of satisfied customers, inexpensive trading costs, and wide variety of trading instruments. The IG help desk staff is professional, quick to reply, and available anytime.

From 8 a.m. Saturday to 10 p.m. Friday, customers can reach help by phone, email, Twitter, and live chat.

Beginner traders who have questions regarding the platforms, analysis, or trading ideas may find the peer support platform to be a perfect extra resource, as it provides assistance from both other traders and IG personnel in a forum discussion.

6. eToro

eToro is still widely recognised as the best social trading platform available. Copy trading and eToro’s social network are at the centre of the user-friendly trading platform. Beginners who lack experience trading may prefer these functions.

eToro’s multilingual customer service team is available around the clock, seven days a week. Tickets have been utilised for all customer service inquiries since 2017. Warning: there is no live chat or phone assistance, and the wait times for answers can be up to 14 days.

Customers that invest more than $5,000, however, will have access to a personal Customer Success Agent.

7. FXCM

High-volume traders that value having access to a diverse selection of trading platforms and a substantial toolkit for advanced trading may be interested in FXCM.

Trading Platforms Offered by FXCM Include: MT4, NinjaTrader, Numerous Advanced Specialty Platforms, and Trading Station, FXCM’s Own Award-Winning Proprietary Platform. In addition to this, it provides a multitude of trading tools, such as a variety of API trading tools, TradingView, Zulutrade, and a whole host of FXCM apps.

Support is offered around the clock through a variety of channels, including live chat, phone, email, and walk-ins.

Support is offered in a total of 19 different languages, and residents of 42 different countries are eligible to receive free phone support from FXCM. In addition to this, the customer care is knowledgeable, and they offer supplementary reading material when it is applicable.

Final Thoughts

Finding the brokers with the finest customer service is one way to make the overall experience of trading much more enjoyable.

It is essential to have a support team readily available at all times, regardless of the severity of the problems that you may experience, even if they are quite minor.

The finest brokers have a supportive team that is knowledgeable about all aspects of the brokerage and is available to assist you around the clock.

Because of this, the support personnel should always be courteous and helpful to their customers, as this results in a far more positive trading experience. When you are having problems that could end up costing you money, the last thing you want to do is have to deal with unhelpful support employees.

More Resources:

Understanding Forex Trading Sessions

Forex Trading Webinars and Training Material

Brokers that Allow You to Trade News Releases

Brokers that allow you to trade news releases

When you engage in news trading, you are purchasing or selling a foreign currency either immediately before or immediately after a significant economic announcement has been made public. Why?

Because after such statements, it is reasonable to anticipate that market prices may fluctuate, which means they will either rise or fall. Your objective, of course, is to make a profit off of these changes in price in a straightforward manner.

Any currency pair has the potential to see very rapid price movement in either direction within just a few minutes before or after the announcement of economic news.

A technique known as “news trading” is one that aims to capitalise on opportunities that present themselves in the markets whenever pertinent economic data and information is reported in the mainstream media.

During each and every trading session, economic news and data are one of the primary factors that can cause significant price shifts or volatility. This indicates that news trading offers consistent possibilities for trading, despite the fact that these opportunities are not devoid of associated risks.

The news market is mostly driven by events, and as a result, trading based on the news presents some unique challenges when compared to traditional technical and fundamental approaches.

In technical analysis, the belief is that past price action will influence future price behaviour, with the assumption being that all essential information about the value of an asset is reflected in its current price.

Technical traders constantly monitor the market and base their trades on observable patterns in the charts, as well as mathematical indicators.

On the other hand, fundamental analysis entails evaluating all of the underlying economic, social, and political aspects that have an effect on the value of a specific asset.

Although news trading is often considered to be a fundamental subset of fundamental analysis, it does have certain distinct characteristics of its own.

In this article, we explore some of the best Forex brokers which allow for news trading, and take a closer look at how to trade the news successfully.

Best news trading brokers

1. Khwezi Trade

Khwezi Trade was established in 2013, and is a local South African broker that is regulated by the FSCA. It features minimal deposit ZAR accounts, rapid trade execution, and a reputation for putting the customer first when dealing with traders.

Every customer of Khwezi Trade receives a daily email with Flexi analysis from a 3^rd party, and the company also provides its customers with access to a portal that displays fundamental analysis of all currency pairs.

2. FXCM

FXCM has been in operation since 1999 and has its headquarters in London. FXCM’s no-requote policy makes it a good option for news trading.

For a Mini account, their lowest spread is about 1.5 pips, while for a Standard account, it’s at least 0.5 pips plus an additional commission of 0.04 USD every 1000 units.

As opposed to several other brokers, FXCM does not use MetaTrader 4. Instead, they support Trading Station, an internal platform that can be customised with a number of add-ons and indicators.

3. InstaForex

Since InstaForex’s spreads are fixed at roughly 3-7 pips, even when the market is extremely volatile due to news releases, it may be a good choice for news trading.

In addition to the well acclaimed MetaTrader 4, MetaTrader 5, and InstaForex’s proprietary WebTrader, InstaForex provides its clients with a wide selection of trading platforms from which to choose. They also provide the convenient One-Click-Trading (OCT) function as an add-on.

However, there are several factors that you need to be aware of regarding news trading in InstaForex. The first point is that during major news events, profits cannot exceed 10% of the account balance, and the position must be open for at least 5 minutes before being closed.

To prevent misunderstanding and blunders during news trading, InstaForex gives a basic overview of this particular approach in a collection of forex articles and its trading education area which beginners may take advantage of.

4. XM

Orders placed with XM are guaranteed to be executed within 1 second, there will be no requotes, and the spread will be incredibly low.

Micro and Standard accounts have floating spreads beginning at 1 pip, while the Zero account has no spread at all. XM not only permits news trading, but also provides numerous alluring promotions including signup bonuses, trading competitions, and initial deposit incentives.

Top tips for trading the news

The news can be broken down into two categories: regular and unexpected. General elections, quarterly earnings reports, and announcements of economic statistics such as interest rates and jobless rates are just some of the events that are planned.

An economic calendar, news feeds, and even social media can be used to keep tabs on upcoming developments.

The majority of news trading methods revolve around anticipating and reacting to scheduled events, and traders can reduce their exposure to risk by keeping tabs on when those events are set to occur.

The opposite is true with unexpected news, which consists of happenings that are so unexpected that they can catch investors and traders off guard. The timing and magnitude of their effects are unknown.

Events like the 2008 financial crisis and the predicted coronavirus pandemic in 2020 fall into this category.

Because it is impossible for traders and investors to tell when the panic-inspired short-term impact will finish and the expected long-term correcting move will begin, sporadic news is a major source of risk in the market.

Find trading opportunities

The goal of news trading is to consistently take profitable positions. In other words, your transaction coincides with the market’s reaction to the news. Trading is possible before, during, and after the announcement.

If you trade in anticipation of an occurrence, it shows that you have a directional bias and, if you’re correct, you’ll profit. If you’re incorrect, however, you could lose a lot of money.

Trading at the time of a news event’s announcement can be wise because you’ll be basing your decisions on accurate information.

There is no assurance that prices will move in the direction that an actual news release implies, and spreads tend to increase as news events are released. It’s smart to do trades after a news release so you can observe the market’s reaction first-hand.

Keep track of the news event

You can only profit from news trading if you are aware of the specific types of news that affect the asset you plan to trade. The Economic Calendar is a useful tool for keeping tabs on upcoming news events, and it’s even better because it also shows how much of an effect those events are anticipated to have on the underlying asset.

Include technical analysis

Using technical analysis in conjunction with news trading can lead to substantial gains. If you want to take advantage of a news trading opportunity, you need to keep an eye on the crucial technical characteristics of the underlying asset.

You should know the underlying trend and key support and resistance levels that will act as price objectives for take profits and stop losses before the news is released. Before, during, and after a news event, technical tools like moving averages, pivot points, and even oscillators can assist traders find value pricing zones to target.

Final Thoughts

It is vital to deal with a reliable broker like Khwezi when trading the news. Many factors, including the broker’s compliance with legislation, features, and quality of customer service, should be considered before settling on an account with them.

But apart from that, a savvy trader will be aware of the importance of having a broker who can keep up with their trading strategy and help them achieve their goals. To be successful, traders need to prioritise conditions in accordance with their trading strategy.

Foreign exchange (forex) news trading refers, in a nutshell, to making currency transactions in the forex market in response to trading opportunities presented by economic news announcements. An unexpected piece of news has the potential to drastically alter the market’s valuation in a hurry. Many investors play the markets because of the high volatility and short trading cycles.

In order to capitalise on this trend, traders must have access to both lightning-fast execution and adaptable market circumstances. At this juncture, the quality of the broker’s service becomes critical. It’s possible that your broker isn’t ideal for news trading if your trade orders are constantly being requoted when major news is released.

More Resources:

Understanding Forex Trading Sessions

Forex Trading Webinars and Training Material

Forex Brokers with the Best Customer Service

MetaTrader 4 or MetaTrader 5: Which is better?

MetaTrader 4 and MetaTrader 5 are both industry-leading forex trading platforms. They offer a wide range of features and tools to help traders succeed in the forex market. But which one is better? In this blog post, we will compare MetaTrader 4 and MetaTrader 5, and we will let you decide which one is best for you.

MetaTrader 4 was released in 2005 and has since become the most popular forex trading platform in the world. MetaTrader 5 was released in 2010 and is an upgraded version of MetaTrader 4.

Forex or cfd trading are complex instruments and come with a high risk of losing your money rapidly due to leverage. If you can afford to take on the high risk of these complex instruments it is important to trade through a platform that is regulated by the FSCA.

1. What is MetaTrader 5 and what are its features

MT5 is the platform used by millions of traders around the world and offers a wide range of features, making it the perfect choice for both beginners and experienced traders.

Some of the most popular features of MetaTrader 5 include:

– Supports multiple languages

– Advanced charting tools

– A large variety of technical indicators

– A built-in market scanner

– The ability to back test trading strategies

– Expert advisors for automated trading

If you’re looking for an online trading platform to take on the high risk of speculating in the financial markets, that offers everything you need to succeed, MetaTrader 5 is the right choice for you.

2. How to install MetaTrader 4/5

The first thing you need to do is open an account with a broker that offers MetaTrader 4/5.

Khwezi Trade

Looking for an authorised financial services provider (FSP 44816) and regulated Over-the-Counter Derivatives Provider that offers MetaTrader 5? Look no further than Khwezi! Khwezi is a leading South African broker that offers the MT5 platform with ultra fast trade execution for you to start trading. With Khwezi, you can trade the financial markets with confidence and peace of mind.

Download MT5

Once you have an account, you can download the MetaTrader 5 software from Khwezi and install the software on your computer, and then launch the program.

Alternatively, if you plan to trade on your mobile phone you can find the appropriate MT5 download options for Android here and for IOs here

A quick guide

1) After you have downloaded and installed MT4 from your broker’s website, open the program and select “File > Open an Account”.

2) Enter your account details and server information provided by your broker.

3) Select “Tools > Options” to customize your trading experience.

4) To open a new chart, go to “File > New Chart”. You can then select the currency pair you want to trade and other settings like time frame and chart type.

5) To place a trade, go to “Insert > New Order” or simply press “F9” on your keyboard.

To access the MT5 manual, click here.

3. Options you should consider whether choosing between MT4 & MT5

When it comes to choosing a trading platform, MetaTrader 4 (MT4) and MetaTrader 5 (MT5) are the two most popular options. Both platforms offer a range of features and benefits, but which one is the better choice for you?

MT4 is a well-established platform that is widely used by traders of all levels of experience. It offers a user-friendly interface, a range of analytical tools and expert advisors, and is highly customizable. MT5, on the other hand, is the newer platform from MetaQuotes. It includes all the features of MT4, plus additional ones such as economic calendar and news feed. It also offers more flexibility in terms of order types and execution modes.

So, which platform should you choose? Ultimately, it depends on your individual trading needs and preferences. If you are new to trading or want a simple platform with all the basic features, MT4 may be the better option for you. However, if you are an experienced trader who wants access to more advanced features and tools, then MT5 may be the better choice. Whichever platform you choose, make sure that it offers all the features and functionality that you need to trade effectively.

4. Tips and tricks for using MetaTrader 5

There is a wide range of features and tools for traders of all levels of experience for MetaTrader 5 trading. If you’re new to the MetaTrader 5 trading platform, here are a few tips and tricks to help you get started.

First, take some time to familiarise yourself with the interface. The main window consists of three tabs: Quotes, Order Book, and History. Under the Quotes tab, you’ll find live prices for all the instruments that are available to trade. The Order Book tab shows all pending and completed orders. Finally, the History tab provides a record of your past trades.

Next, explore the different order types that are available on MetaTrader5. Market orders are the most basic type of order and will be executed at the current market price. Limit orders allow you to set a maximum or minimum price at which you’re willing to buy or sell an instrument. And stop orders become active when the market price reaches a certain level, at which point they will be executed as either market or limit orders.

Finally, don’t forget to take advantage of the built-in technical analysis tools. MetaTrader5 includes a complete suite of charts and indicators that can be used to identify trends and make informed trading decisions.

The high risk of losing when trading Forex

When it comes to investing, there are a lot of different options out there. Some people prefer to stick to more traditional investments like stocks and bonds, while others are willing to take on a bit more risk in hopes of earning a higher return. Forex trading falls into the latter category.

While forex trading does have the potential to generate high returns, it also comes with a high degree of risk. This is due in large part to the fact that currency values can fluctuate rapidly and unexpectedly. As a result, forex traders need to be very careful about when and how they enter into trades.

Of course, high risk investments are not for everyone. However, those who are willing to take on the risk can potentially reap some big rewards. Just remember that it is important to do your research and tread carefully before jumping into the forex market.

If you are new to trading, it is worthwhile trying out a demo account on this website. There is no risk of losing money as it is not a live trading account. The prices and the charts depict a live trading environment, but it is risk free as you are not investing real money. Alternative, for free educational content, visit this website called Babypips.

Conclusion

MetaTrader 4 and MetaTrader 5 are both popular online trading platforms that offer a range of features and tools for traders of all levels of experience. They both have their pros and cons, so it ultimately depends on your individual needs and preferences as to which one is the better choice for you. Make sure to explore all the different options available to you before making your decision.

10 Best FSCA-Regulated Forex Brokers in South Africa

10 Best FSCA Regulated Forex Brokers in South Africa

The Financial Sector Conduct Authority or FSCA is the financial regulator in South Africa. The FSCA is one of the most reputable regulatory authorities that ensures that all retail traders and consumers are treated fairly, that forex brokers are ensuring client fund security by keeping funds in segregated accounts, and that all financial service providers can meet their financial obligations.

The FSCA watches over forex trading in South Africa and provides retail traders frequent updates on forex brokers including warnings, risk warnings, and other important information. The FSCA also enhances and supports the integrity of the financial markets in South Africa. The FSCA is one of the most reputable regulatory entities in the world.

We explore the best FSCA regulated forex brokers in South Africa.

What are the benefits of trading with an FSCA regulated forex broker in South Africa?

When you trade with an FSCA regulated forex broker, you can be sure that your broker is adhering to strict financial regulations. This means that your broker is held to a high standard of conduct and must maintain a high level of transparency. Furthermore, your broker must keep your funds safe by segregating them in a segregated account. This ensures that your funds are not used for other purposes when it comes to deposits and withdrawals.

The best forex brokers in South Africa have been authorised by the FSCA with an OTC licence. This is called an Over-the-Counter (OTC) licence which derivative providers need to continue operating as a broker in South Africa for 2022. These brokers are now referred to as ODPs and must be licenced or have a pending application submitted to the FSCA. These brokers are allowed to offer a wide range of instruments on their trading platforms. There are various account types and trading fees associated to these regulated brokers when trading forex pairs.

Trading Platforms

MetaTrader 5 is a leading global Forex and CFD trading platform. It offers traders an intuitive interface with advanced features, charting tools, technical indicators and more. MT5 also allows traders to use automated trading strategies, EA’S or “bots”, to help them trade the markets. The best brokers in South Africa offer the MT5 to their traders with fast execution time and trading conditions.

How does Forex trading work in South Africa?

Investing in forex is very popular in South Africa. The Financial Sector Conduct Authority (FSCA) protects The South African Forex industry making it totally legal.

The act of speculating on one currency against another is known as forex trading. Financial institutions and investment banks employ Forex trading, also known as FX trading, to make money and protect their other investments.

Private persons in South Africa, known as retail Forex traders, are also active participants in the forex CFD market, and make up a huge proportion of Forex traders in South Africa.

Risks Involved

The high risk of losing your money does exist when trading currency pairs due to the leveraged speculative nature of trading forex cfds. For beginners, who don’t have the appropriate knowledge, these complex instruments can be challenging to understand and often lose money when trading. Retail investor accounts lose money when traders risk too much capital on margin and are exposed, due to the leverage, when markets are volatile. If you are new to trading it might be advisable to first open a demo trading account, completely risk free, in order to get to grips with the forex market. The broker will offer demo accounts as part of their forex service offering. The best forex brokers in South Africa will offer a low minimum deposit to part-time traders as there is less risk involved for these retail investor accounts.

How to trade the Forex market in South Africa

Approximately 100 trillion Rand (6.6 trillion USD – 2019) is traded daily in the Forex market, making it the world’s largest and most liquid financial market. And currency trading is done on the Forex market, which involves buying and selling currencies.

Foreign exchange traders acquire currency CFDs at current market prices and sell them for a price in the future. The difference between the purchase and sale price is the trader’s profit or loss because currency prices are always fluctuating.

Only by taking advantage of the market’s turbulence can Forex traders turn a profit. Despite the fact that the Forex market is open 24 hours a day, the most volatile times of the day are when the major stock exchanges in Sydney, Tokyo, London, and New York are open for business.

When London and New York open their doors at the same time, Forex traders are most likely to be in action. Because we share a time zone with London, we can take advantage of these market openings during regular business hours because of our location in South Africa.

A Forex broker is the only means for individual investors to have access to this global market. Clients of a Forex broker have access to trading software and the market, allowing them to do market analysis and buy and sell currencies as needed.

New Forex traders in South Africa should choose brokers who are regulated by the FSCA and have been issued or have an application pending for the new OTC license in order to ensure secure access to the Forex markets.

The best way to conduct Forex trading in South Africa

The Financial Sector Conduct Authority (FSCA) in South Africa is responsible for regulating Forex trading and currency CFDs. Deliverable Forex is also under SARB control. Protecting South African citizens from financial fraud and promoting a healthy and competitive financial marketplace are the responsibilities of the FSCA.

The Johannesburg Stock Exchange, banks, hedge funds, and other financial service providers are all under its watchful eye.

Customers’ money must be kept separate from the company’s operating finances and examined on a regular basis by FSCA-regulated Forex brokers to guarantee that customer funds are not misused.

For the sake of Forex traders in South Africa, all FSCA-regulated brokers are required to apply for an Over-the-Counter Derivative Provider (ODP) license, which ensures that Forex brokers are overseen by trained non-executive directors, who sit on the board and that they have a sufficient cash reserve to avoid insolvency.

For South African traders who choose a forex broker who holds their cash in a local bank like Khwezi this gives an additional layer of security. Your funds can be reclaimed in the event of a broker’s insolvency or closure by the Financial Sector Conduct Authority (FSCA).

Rand (ZAR) trading accounts are also available to Forex traders in South Africa from local brokers. Only USD or EUR trading accounts are offered by the vast majority of offshore Forex companies.

It costs South African traders money every time they deposit or withdraw funds from a USD trading account. There are no conversion fees while using a ZAR trading account. Withdrawals and deposits are also faster because most ZAR trading accounts are held in South African banks.

What is the spread in forex?

The spread is the difference between the bid and ask prices. The ask price is the price at which a trader can sell a currency, while the bid price is the price at which a trader can buy a currency. The smaller the spread, the more expensive it is to trade.

The average spread eur usd is 2.5 pips. The best forex broker will try and offer the best spread possible to its clients. Depending on your account type and your minimum deposit will determine which spreads you receive from your broker. Khwezi Trade offers the best spread on EUR USD of 1.5 pip to its clients.

Forex trading with a pips calculator

Pip is an abbreviation for “percentage in point,” which can also be translated as “price interest point.” The smallest price movement that an exchange rate can make in accordance with forex market standard is referred to as a pip.

A pip is a fundamental notion in the world of Forex trading. Forex pairings are used to communicate exchange quotations, which are accurate to four decimal places, through bid and ask quotes that are displayed on a chart.

‘Fractional pip pricing’ is a feature that most forex brokers provide in addition to the normal pip pricing. A fractional pip is one tenth of a pip as a result of the addition of a fifth decimal place.

The use of fractional pip spreads can allow for tighter spreads and a better understanding of the changes of a currency’s price. These minuscule units of measurement, when used to measure price change, safeguard investors from suffering large losses.

As an example, if a pip were worth 10 basis points instead of one, a change of one pip in the exchange rate would produce significantly greater volatility in the value of a currency.

Using a pip value calculator will provide you with the value of a pip in the currency in which you wish to trade in. This information is critical in deciding whether or whether a transaction is worth the risk, as well as in effectively managing that risk.

Khwezi Trade

Khwezi Trade is one of the most reputable FSCA-regulated forex brokers.

Khwezi Trade is an FSCA licensed OTC provider and caters to beginner traders and professional investors by providing a wide range of tradable instruments.

Khwezi Trade is both suited for beginner and experienced traders.

The broker features low minimum deposits on retail trading accounts, providing traders with a low barrier of entry into forex markets and some of the best educational materials.

Traders can expect competitive spreads, decent maximum leverage, and a transparent trading environment where client funds are secure.

Khwezi Trade Pros and Cons

✔ Pros	❌ Cons
Well-regulated by the Financial Sector Conduct Authority and caters specifically for South African traders	Limited account currency options
Innovative mobile apps offered through MetaTrader	Individual stock trading not supported
Trading tutorials and market analysis provided
Dedicated account manager is provided
There is a choice between trading ZAR accounts

Khwezi Trade features

👉 Feature	ℹ️ Information
👮‍♂️ Regulation	👍 FSCA
💵 Minimum deposit from	💰 ZAR500
⚖️ Average spread from	👉 0,6 pips
📈 Commissions from	N/A
💸 Deposit/Withdrawal Fees	N/A
⚖️ Maximum Leverage	⚖️. 1:400
🤑 Bonuses	👍 30%
❓ Customer Support	🏪. 24/5

Velocity Trade

Velocity Markets was established in 2007.

Velocity Trade is a leading global provider and a reputable forex broker that accepts South African clients.

Forex traders who register a trading account with Velocity Trade can expect powerful and innovative trading technology.

Velocity Markets gives advanced and flexible trading services and a plethora of trading opportunities.

Velocity Trade Pros and Cons

✔ Pros	❌ Cons
Well-regulated broker and financial service provider	Limited funding options offered
There is a wide range of assets that can be traded	Limited educational materials offered
Flexible and innovative trading platforms supported	Not suited to beginner traders
Client fund security is guaranteed, and funds are kept separate from company funds
Recommended for institutional traders

Velocity Trade features

👉 Feature	ℹ️ Information
👮‍♂️ Regulation	👉 ASIC, AFSL, ASX
💵. Minimum deposit from	💰 $1 / 16 ZAR
⚖️ Average spread from	👉 3.0 pips
📈 Commissions from	📈 None
💸 Deposit/Withdrawal Fees	🙅. Not indicated
⚖️ Maximum Leverage	⚖️ 1:500
🤑 Bonuses	💰 Yes
❓ Customer Support	🏪 24/5

Colmex Pro

Colmex Pro is a well-regulated and well-established No-Dealing Desk (NDD) forex broker that is well-regulated by the Financial Sector Conduct Authority (FSCA) and the Cyprus Securities and Exchange Commission (CySEC).

Colmex Pro has been offering comprehensive trading solutions for more than a decade.

The forex broker has strategic partnerships with international banks, ensuring that forex traders have some of the most competitive pricing in the industry.

Colmex Pro offers MetaTrader 4 in addition to a powerful proprietary trading platform that can be used when carrying out trades.

Traders can also expect a reliable trade execution policy and innovative trading software infrastructure.

Colmex Pro Pros and Cons

✔ Pros	❌ Cons
Well-regulated by CySEC and FSCA which are both top-tier regulators	Demo accounts are only available for 14 days
All trading strategies are accommodated	Limited education materials offered
Trading platforms are flexible and innovative	Market News and analysis are not offered
Reliable trade execution speeds with minimal slippage	Limited funding options offered
Competitive trading conditions are provided	High minimum deposit requirement

Colmex Pro features

👉 Feature	ℹ️ Information
👮‍♂️ Regulation	👉 CySEC, FSCA, FCA, BaFin, CNMV, ACPR
💵. Minimum deposit from	💰 $10 000 / 160 000 ZAR
⚖️ Average spread from	👉 0.9 pips
📈 Commissions from	📈 $1.50 / 24 ZAR
💸 Deposit/Withdrawal Fees	🙅. None
⚖️ Maximum Leverage	⚖️ 1:30
🤑 Bonuses	💰 Yes
❓ Customer Support	🏪 24/5

IG Markets

IG Markets South Africa Limited is another FSCA-regulated broker that accepts South African residents.

IG has regulations and authorization with several other regulatory bodies around the world to offer more than 17,000 financial instruments that can be traded across asset classes.

IG Markets offers a transparent fee schedule with competitive rollover fees, tight spreads, low commissions, and no hidden fees.

IG caters to experienced traders by offering advanced trading tools, technical analysis, fundamental analysis, and more.

IG Markets Pros and Cons

✔ Pros	❌ Cons
Free forex trading signals are provided along with excellent market analysis	Inactivity fee charged
Excellent education materials are provided	A high minimum deposit required
A wide range of advanced trading tools are offered
Powerful and user-friendly trading platforms provided along with innovative forex trading apps
Fast, low-cost trading guaranteed
Multi-regulated and trusted financial service provider and forex broker
Deposit fees and withdrawal fees are not charged
Offers a choice between retail trading accounts for South African clients
Offers Islamic Accounts for Muslim Traders

IG Markets features

👉 Feature	ℹ️ Information
👮‍♂️ Regulation	👉 FCA, BaFin, CySec, FINMA, FSCA, MAS, JFSA, ASIC, FMA, CFTC, BMA,
💵. Minimum deposit from	💰 $250 / 4 000 ZAR
⚖️ Average spread from	👉 0.8 pips
📈 Commissions from	📈 1% and up
💸 Deposit/Withdrawal Fees	🙅. None
⚖️ Maximum Leverage	⚖️ 1:50
🤑 Bonuses	💰 No
❓ Customer Support	🏪 24/5

HotForex

HotForex is the trading arm of HF Markets and its parent.

HotForex is well-regulated in several jurisdictions around the world, including South Africa through the FSCA.

HotForex has more than 1.5 million registered traders from around the world.

Hotforex has already won more than 25 industry awards.

Awards for excellent customer services, powerful trading platforms, and competitive trading conditions are just a few of the many awards received by Hotforex.

Hotforex Pros and Cons

✔ Pros	❌ Cons
Well-regulated by several entities through its parent company, giving traders peace of mind	Fixed spreads are not offered
Allows all kinds of traders including active traders, high volume traders, and others
Commission-free trading offered along with free financial education
Negative balance protection applied to retail accounts

Hotforex features

👉 Feature	ℹ️ Information
👮‍♂️ Regulation	👍 CySEC, DFSA, FCA, FSA, FSCA
💵 Minimum deposit from	💰 $5
⚖️ Average spread from	👉 0,0 pips
📈 Commissions from	📈 USD 0.03 per 1K lot.
💸 Deposit/Withdrawal Fees	🙅 None
⚖️. Maximum Leverage	⚖️. 1:1000
🤑 Bonuses	👍 100% Supercharged Bonus
❓ Customer Support	🏪 24/5

Blackstone Futures

Blackstone Futures was established in 2009.

Blackstone Futures is a reputable South African broker that offers traders some of the best trading conditions in the country.

Blackstone Futures is well-known for providing a safe trading environment in which client deposits and assets are protected.

Traders can choose between useful trading tools, a powerful CloudTrade proprietary platform MetaTrader 4, and a plethora of trading opportunities.

This gives traders the ability to use different trading strategies and trading styles across financial markets.

Blackstone Futures Pros and Cons

✔ Pros	❌ Cons
A well-regulated financial services provided and broker in the forex industry	Limited retail account options
Offers a wide range of currency pairs and several other instruments	Limited funding options
Advanced trading tools offered, adding a competitive edge to trading strategies of experienced traders	Spreads are not the tightest
Educational materials are offered alongside a powerful forex trading platform
Offers currency trading, CFD trading, and a plethora of trading opportunities

Blackstone Futures features

👉 Feature	ℹ️. Information
👮‍♂️ Regulation	👍 FSCA
💵 Minimum deposit from	💰 ZAR R1000
⚖️ Average spread from	👉 2.0 pips
📈 Commissions from	📈 N/A
💸 Deposit/Withdrawal Fees	🤷 N/A
⚖️. Maximum Leverage	⚖️. 1:400
🤑. Bonuses	💰 25%-50% percent of base salary
❓ Customer Support	🏪. between 9:00 – 17:00 (GMT +1)

Exness

Exness is a reputable FSCA-regulated broker that has offices in several regions around the world.

Exness is well-known for its flexible trading account types, competitive trading conditions, and high maximum leverage ratio.

Exness is known for offering a transparent trading environment, low minimum deposit requirements.

Exness is also known to have some of the best averages spreads in the industry.

Exness Pros and Cons

✔ Pros	❌ Cons
A perfect option for beginner forex traders in South Africa	Limited financial instruments offered
Offers tight average spreads, a high maximum leverage ratio, and low USD minimum deposit
Regulated by top-tier regulators in the forex industry
Offers advanced trading tools, excellent education, and award-winning customer service

Exness features

👉 Feature	ℹ️. Information
👮‍♂️ Regulation	👍 CySEC
💵 Minimum deposit from	💰 $10 / ZAR R160
⚖️ Average spread from	👉 0.0
📈 Commissions from	📈 ‎$0.1 / ZAR R1.60 to $3.50 / ZAR R56.00
💸 Deposit/Withdrawal Fees	🤷 Variable depending on method
⚖️. Maximum Leverage	⚖️. 1:2000
🤑. Bonuses	💰. 10% of Deposit Bonus
❓ Customer Support	🏪. 24/7

Markets.com

Markets.com is a reputable broker for beginners and experienced traders from South Africa.

Markets.com provides over 2,200 financial instruments that can be traded through MetaTrader and a powerful proprietary trading platform.

Markets.com has more than 5 million registered traders that use its services, proving that it is a trusted forex broker.

Markets.com has won several industry awards and it is one of the best brokers in South Africa to offer personalised training, dedicated customer service, and a range of advanced analysis tools and technical indicators.

Markets.com Pros and Cons

✔️ Pros	❌ Cons
Markets.com is a broker with a high trust score that offers ZAR as the base currency and deposit currency	A high minimum deposit is required when traders register a live account with Markets.com
User-friendly trading technology supported with a proprietary mobile app	An inactivity fee is charged on dormant accounts
A tight average spread is offered on forex major pairs
Commission-free trading is provided
There are no deposit fees or withdrawal fees charged
Caters for all trading styles and trading strategies

Markets.com features

👉 Feature	ℹ️ Information
👮‍♂️ Regulation	👉 FSCA
💵 Minimum deposit from	💰 $100 / ZAR R1 600
⚖️ Average spread from	👉 1.9 pips
📈 Commissions from	📈 $0 / ZAR R0
💸 Deposit/Withdrawal Fees	🙅 None
⚖️ Maximum Leverage	⚖️ 1:300
🤑 Bonuses	💰 Yes
❓ Customer Support	🏪 24/7

Globex360

Globex360 is a South African-based forex broker regulated by the Financial Services Conduct Authority.

Globex360 provides South African traders access to more than 100 tradable financial instruments that can be traded across forex pairs, commodities, and indices.

Traders can trade major currencies, minor pairs, exotic pairs, by using the powerful trading platform that Globex360 provides across web browsers, desktop apps, and mobile trading.

Globex360 Pros and Cons

✔ Pros	❌ Cons
Copy-trading offered	Limited trading instruments
Well-regulated	Individual stock CFDs not offered
Islamic Account offered	Lack of education
FIX API provided	Limited funding options
User-friendly trading platform provided

Globex360 features

👉 Feature	ℹ️ Information
👮‍♂️ Regulation	👉 FSCA
💵. Minimum deposit from	💰 $25 / 400 ZAR
⚖️ Average spread from	👉 1.6 pips
📈 Commissions from	📈 None
💸 Deposit/Withdrawal Fees	🙅. None
⚖️ Maximum Leverage	⚖️ 1:400
🤑 Bonuses	💰 Yes
❓ Customer Support	🏪 24/5

Frequently Asked Questions

Some offer ZAR accounts, but not all. FSCA-regulated brokers who are headquartered in South Africa tend to offer ZAR accounts with South African banks, but international forex brokers who have FSCA regulation will not always offer ZAR-denominated trading accounts.

Yes, if the regulation of the forex broker has been verified on the FSCA’s official website, these brokers can be trusted. However, keep an eye out for any warnings issued by the FSCA about brokers.

Several brokers, both local and international, have FSCA regulation and the brokers on this list are some of the best.

Yes, as a South African trader you should consider trading with an FSCA-regulated forex broker to ensure that you are covered and that your funds are safe.

The FSCA is a governing body and competent regulatory authority in South Africa that oversees the financial markets in South Africa, including the forex market.