Why Trade Forex in South Africa?

Why Trade Forex in South Africa?

When it comes to trade forex in South Africa you will find it is a hotbed of activity. The country has a robust economy and is home to a large number of forex traders. In fact, according to the latest statistics, there are over 200,000 active forex traders in South Africa.

Are you looking for a new way to make money? If so, you may want to consider trading forex. Whether you understand how is an important factor you should consider with real money when trading cfds with a regulated South African broker who has an ODP licence. Forex is the world’s largest financial market, and offers traders a variety of opportunities to make profits. In addition, forex is trade 24 hours a day, five days a week, making it an ideal investment opportunity for those who have full-time jobs or other commitments.

The Forex Market

The global forex market is the largest and most liquid market in the world. Due to this liquidity, if you can afford to trade currency pairs and take the high risk involved on, it can be rewarding. It must be said that one can lose money when trading. The forex market is made up of banks, commercial companies, central banks, investment management firms, hedge funds, and retail traders. The Forex Market is unique in that there is no central marketplace. Instead, trading takes place electronically over-the-counter (OTC). You should consider if you can afford to take on the risk of losing your money when you enter the forex market, as cfds are complex instruments and come with volatility, which can affect your trading positions rapidly due to leverage.

Understand how cfds work when you trade forex?

A cfds is a contract for difference, which is an agreement between two parties to exchange the difference in the value of an asset from the time the contract is opened until it is closed. With forex trading, you speculate on the movement of currency pairs, and you don’t actually own the underlying currency. When you open a position, you will be entering into a contract with your broker. For example, if you buy Euros with US dollars, you are speculating that the value of the Euro will increase against the dollar. If your speculation is correct and the currency pair increases in value, you will make a profit. If your speculation is incorrect and the currency pair falls in value, you will make a loss.

When trading forex, you will use leverage. Leverage is a loan that is provided to you by your broker. This loan allows you to trade with more money than you have in your account. For example, if you have a forex account with a leverage of 1:100, it means that for every R1 you have in your account, you can trade with R100. While leverage can help you make bigger profits, it also increases your risk because you are effectively trading with borrowed money. All of this is important to understand how cfds work.

Khwezi Trade is an authorised FSP and licenced ODP. You can trade cfds with this provider. Trading cfds with this FSCA regulated broker ensures your investor account is kept safe in a segregated trading account at all times. This means withdrawals will always be processed on time, all the time.

The High Risk of Losing

When trading forex, it is important to be aware of the risks involved. Forex is a high-risk investment, and it is possible to lose the entire value your retail investor account. Many traders have been burnt trying to get rich quick overnight. This strategy is not recommended and comes with a high risk.

In addition, forex traders should be aware of the potential for margin calls and stop-loss orders. A margin call occurs when your broker demands that you deposit more money into your account to cover losses. A stop-loss order is an order that closes your position automatically when it reaches a certain price. These orders are designed to limit your risk, but they can also limit your profits if the market turns against you.

The best way to avoid these risks is to practice risk management and use appropriate leverage.

Risk Management for forex trading

Risk management is the process of identifying, assessing, and controlling risk. It is an important part of forex trading, and it should be a priority for all traders.

There are a number of risk management tools available to forex traders. These tools can help you manage your risk and protect your capital.

Some risk management tools include:

Limit Orders

A limit order is an order to buy or sell a currency pair at a specific price. Limit orders can help you manage risk by allowing you to set the price at which you are willing to enter or exit a trade.

Stop-Loss Orders

A stop-loss order is an order that closes your position automatically when it reaches a certain price. Stop-loss orders can help you manage risk by allowing you to set the price at which you are willing to exit a trade.

Risk-to-Reward Ratio

The risk-to-reward ratio is the ratio of the potential risk to the potential reward of a trade. A higher risk-to-reward ratio means that the potential risk is higher than the potential reward. A lower risk-to-reward ratio means that the potential risk is lower than the potential reward.

Diversifying Your Portfolio

Diversifying your portfolio is a risk management strategy that can help you manage risk by spreading your investments across different asset classes.

Forex trading is a high-risk investment, and it is possible to lose the entire value of your account. However, if you practice risk management and use appropriate leverage, of retail investor accounts losing. Remember to always do your research before entering any trade, and never risk more than you are willing to lose.

So, why trade online in South Africa? Here are four reasons:

1. The South African economy is strong and stable.

The South African economy has been through a lot in recent years, but has emerged stronger than ever. This makes it an attractive destination for foreign investment, and provides a stable environment for forex trading due to a high level of regulation.

The South African economy has been through a lot in recent years, but has emerged stronger than ever. This makes it an attractive destination for online trading and provides a stable environment. The country has a well-developed financial sector and is the largest market in Africa. It offers a great opportunity for those looking to take advantage of the trading profession. A feather in the cap for South Africa is the well-regulated financial environment.

South African financial regulatory framework

Our regulation is one of the most comprehensive in the world. The country has a number of regulatory agencies that oversee different aspects of the financial sector, including the South African Reserve Bank (SARB), the National Treasury, and the Financial Sector Conduct Authority FSCA.

The SARB is responsible for regulating the banking sector and ensuring the stability of the financial system. The National Treasury is responsible for managing the government’s finances, and the FSCA is responsible for regulating the conduct of financial institutions in South Africa.

The FSCA regulatory framework provides a high level of protection for investors, and ensures that forex trading is conducted in a fair and transparent manner.

Over-the-Counter Derivatives Provider (ODP) Regulation

The ODP regulation is a new measure to ensure the safety of traders. This will have a big impact on the forex market and how it is traded.

With this new regulation, traders need to find an ODP in South Africa to trade with. To check you your broker has applied for the OTC licence in order to operate as an ODP click on the link of FSCA approved Over-the-Counter Derivatives Provider

There are a number of brokers operating in South Africa without an OTC licence which has resulted in the FSCA issuing directives to suspend their business activities. It is very important to ensure that you are trading with a financial authorised service provider and licenced ODP entity.

2. The forex trading community in South Africa.

If you’re looking for an exciting and vibrant forex trading community, South Africa is the place to be. Here you’ll find a large number of traders of all experience levels, from beginners to experts. There are a variety of forums and chat rooms where you can share ideas and tips with other traders. SA forex traders are some of the most active and vocal in the world. You’ll find a wealth of information and resources online, as well as offline through forex meetups and events.

South Africa is also home to a number of forex seminars, where you can learn from the pros and get started in forex trading. These seminars are attended by some of the top traders in the country, and provide a wealth of information and tips.

Alternative ways to make money in the forex industry in South Africa.

If you’re looking for an alternative to trading and you have a large network, you might consider becoming an affiliate to a reputable forex broker. As an affiliate, you’ll earn commissions on the trades that your referrals make.

3. The South African rand is a major currency.

The South African rand is one of the most traded currencies in the world, which means that there is always a lot of activity in the forex market involving the rand. This makes it easier to find trading opportunities, and also means that you can trade with a currency that you’re familiar with.

The price of a currency

A currency price is determined by supply and demand. When there is more demand for a currency than there is supply, the price will increase. When there is more supply than there is demand, the price will decrease.

Some of the factors that can affect the price of a currency include:

– Economic conditions

– Political events

– Central bank policy

– Geopolitical events

– Investor sentiment

So, why trade the USD/ZAR?

When it comes to trading currencies, the US dollar and the South African rand are two of the most popular options. In fact, the USD/ZAR currency pair is one of the most actively traded in the world.

The US dollar is the world’s reserve currency, which means that it is widely accepted as a form of payment. South Africa is a major trade partner of the United States, so there is always a high demand for rand. The USD/ZAR currency pair is also influenced by political and economic events in both countries.

The two currencies are strongly correlated, meaning that they often move in the same direction. This makes the USD/ZAR a risky but potentially profitable currency pair.

The Strength of the Dollar

The US dollar is currently strong against the Rand, at R17 for one dollar, and the volatility makes it a good time to trade the currency pair. The dollar has been strengthening for the past few months, and there is no indication that this will change anytime soon.

The key reason to its strength is due to safe-haven buying. This is when investors buy assets that are seen as being safe during times of economic or political uncertainty. The dollar is often seen as a safe-haven currency, so it tends to do well during periods of turmoil.

The US dollar is also benefiting from interest rate hikes factor that is contributing to the dollar’s strength is interest rate hikes. The US Federal Reserve has raised interest rates three times in the past year, and is expected to do so again in 2018. This makes dollar-denominated assets more attractive to investors, and drives up the demand for the dollar.

Another Popular currency pair is EUR/USD

The price of the base currency is the amount of the other currency that is needed to buy one unit of the base currency. In other words, it’s the price at which you can buy a given amount of the base currency.

For example, if the EUR/USD exchange rate is 1.02, this means that you need 1.02 US dollars to buy one euro.

4. Reputable forex brokers in South Africa who have an ODP

When you’re choosing a forex broker, it’s important to choose one that is regulated and offers a good range of features and tools.

Forex brokers who conduct business in South Africa need to be an authorised financial service provider and must have an ODP licence from the FSCA. The ODP licence is the most crucial factor to lookout for when trying to find a reputable broker as it guarantees its business has been vetted by the FSCA.

Read this article on best OTC Brokers in South Africa

Learn how to trade forex

When it comes to learning how to trade forex, there are a number of resources available. You can find information on trading platforms, and strategies on websites, forums, and chat rooms. You can also attend forex seminars and webinars where you can learn from experts in the industry.

With a little research and effort, you can be trading forex in no time. Here are two free website with great educational content:

– BabyPips

– Investopedia

Conclusion

If you’re looking for a new way to make money, forex trading could be the perfect opportunity for you. South Africa is a great place to trade forex. With a well-developed financial sector and good regulation ensuring a stable environment for trading. There is a large and active community of traders and you can choose from reputable OTC brokers in South Africa, so you can trade with confidence. So why not start trading forex today?

Khwezi a regulated FSP 44816 and fully licenced ODP

You want to trade forex, but don’t know how to get started or an experienced trader looking for a trusted broker.

Khwezi Trade is here to help. We are a regulated ODP with years of experience in the industry. We offer Forex, Indices and Commodities with low and stable spreads on the MetaTrader 5 trading platform and pride ourselves on our customer service.

The Best Time to Trade Forex in South Africa

The Best Time to Trade Forex in South Africa

When is the best time to Trade Forex in South Africa?

Understanding the best time to trade forex in South Africa depends on a number of factors. In this article, we’ll cover the different Forex markets sessions and explain how to decide on the best time to trade forex.

Trading the international foreign exchange markets online in South Africa is accessible Monday to Friday 24 hours per day, 5 days a week. The global Forex markets are open and available to be traded at 23:00 in South Africa on a Sunday evening and closes at 23:00 on a Friday night.

Positions can be held overnight, for days on end, depending on the preference and strategy of the trader. Many South African online traders who start their trading journey do not completely understand when the best time to trade would be, and more importantly, why…

Before we dive deeper it is important to grasp what to look for when deciding on your trading strategy and preference.

There are 3 key factors to consider when and how to trade Forex

Liquidity
- ease of which positions can be opened and closed
Volatility
- price movement creating opportunities for traders
Trading Volume
- How many times a currency pair is bought or sold in a period

When Forex markets are most active trading conditions can be favorable as spreads are low and market movements increase. This can be seen when the London session opens, as there is often big trading volume and therefore good volatility. The same can be said for the opening bell of the U.S session which brings huge liquidity to the market.

Understanding the best times to Trade Forex in South Africa

Forex Market Hours in South Africa

World Markets	Trading Hours SAST
Sydney, Australia	24:00 – 08:00
Tokyo, Japan	2:00 – 04:30 / 05:30 – 08:00
London, England	10:00 – 19:00
New York, USA	15:30 – 22:00

*All times are South African Standard Time

This article focuses on the top 4 major market sessions affecting Forex trading

How to decide which markets to trade

The first aspect of trading international Forex markets is to identify which markets to trade (EUR, USD, GBP, CHF). Once you have made the decision of which session and currency pair to trade, you can determine what time the market will be actively traded within the country.

It is then important for the discerning South African trader to then take note of the time zone differences and plan trade strategies accordingly.

If you are trading with the goal of closing out your positions after a few days, weeks, or months, then these open / closing times should not affect you greatly. Traders who should take notice are scalpers and day traders.

As traders we want volatility in the markets and, just because the markets are always active, does not mean that they are volatile.

Volatility happens when the exchange opens, and investors are affecting market movements with big orders being processed. Therefore, it is important to note when specific markets open relative to South African time.

The risk of holding a position when different market sessions overlap is big market movements that can negatively affect your open trade.

For example, if you are trading the AUD/USD from 9:00 SAST, you may find the market moves slowly compared to others, because of the fact that neither of these countries (Australia / United Stated) exchanges are open; but when the U.S session does open, your position gets whipsawed in different directions due to liquidity entering the markets.

This article is being written solely for the purpose of providing our local South Africans with insight and perspective.

When trading in South Africa we need to determine the markets, which will provide the most consistent volatility throughout the hours we are actively monitoring our trades.

Therefore, trading markets such as the GBP, ZAR, and EUR would be recommended due to the small gap in the time zones, as the EUR / GBP markets open at 10:00 am.

If you are looking to trade USD pairs, for example, you would look to start your trading day around 15:30 when the U.S session opens.

Trading in the relevant market sessions allows you to decrease your risk through anticipating volatility and holding onto your positions with a trading plan in mind to know when to start closing out.

The best time to trade gold in South Africa

The best time to trade gold in South Africa is when the market is most active and volatile. This can be seen when the London session opens, as there is often big trading volume and therefore good volatility. The same can be said for the opening bell of the U.S session which brings huge liquidity to the market.

It is then important for the discerning South African trader to take note of the time zone differences and plan trade strategies accordingly.

As traders we want volatility in the gold markets and, just because the markets are always active, does not mean that they are volatile.

The risk of holding a a gold trade position when different market sessions overlap is big market movements that can negatively affect your open trade.

The price of gold

When it comes to trading commodities such as gold, it’s important for traders to understand the factors that can affect its price.

Gold is a precious metal that is often used as a hedge against inflation and economic uncertainty. Its price can be affected by a variety of factors, including:

– Economic indicators: such as GDP, inflation and interest rates

– Geopolitical factors: such as trade tensions, conflict and natural disasters

– Supply and demand: including central bank reserve holdings, jewellery demand and mine production

By understanding these factors, traders can get a better sense of how they might affect the price of gold and make informed trading decisions.

As a South African trader, the best time to trade is when major market sessions overlap.

This is generally between 10:00 and 16:00. During these hours South Africans can catch the last two trading hours of the Tokyo session, which overlaps with the opening of the London session, and a few hours later this session overlaps with the opening of the U.S markets.

The London and the U.S sessions are generally the most active trading hours as all market participants affect the currency market in some way. These sessions are prone to important economic news and data being released that potentially have a great impact on exchange rates.

By understanding market sessions you can identify suitable forex strategies based on market activity in those sessions. Volatile market sessions and major currency pairs are ideal for applying a forex scalping strategy if your risk appetite can handle it.

Forex Trading Market in South Africa is Massive

South African Forex Market Drivers

Forex Trading (CFD) in South Africa has grown into a massive market over the last decade. The ease of access to this market is the main driver. The currency market (foreign exchange or forex for short) gives traders access to trading the price move in different currencies across the globe. Many South Africans are particularly interested in the exchange rate between the US Dollar (USD) and the South African Rand (ZAR).

There are various Forex trading markets in South Africa. Let’s have a look at the 5 most alluring elements of the Forex Market for South Africans.

Low Entry Cost

Traditionally it was expensive to trade the stock market and this led to the perception that trading is limited to rich people and large companies only. Although this has changed dramatically over the last 5 years, forex was seen as a more affordable access point to the online markets. Forex trading South Africa gave people an opportunity to trade often from as little as R5000 and even less. When first introduced this seemed very affordable compared to the other markets and many people jumped at the opportunity. The forex CFD market has grown exponentially since it was introduced and it has not yet reached its peak.

Leverage in the Currency Market

Although currency fluctuations are often dwarfed by that of the stock market, the use of CFDs (Contracts For Difference) allowed the addition of leverage in the forex market. This can get rather complex, but in simple terms, you can trade a larger amount of money than just your deposit. For a more detailed explanation of leverage you can read: How does leverage work in the forex market?

This means that not only is it more affordable to enter the market, you can also trade large positions. It is very important to note that although this does present the opportunity to make more profit it also increases the risk of loss. Leverage is often referred to as a double-edged sword. Make sure you research the concept of leverage thoroughly before you start to trade forex.

Forex Trading South Africa – Trade from Anywhere

As long as you have a device i.e PC, Laptop, Tablet, or Smartphone, and an internet connection, you can trade. This means that you are not limited geographically. You can travel the world without missing a trade. This is one of the most alluring aspects of the currency market. Previously, people in remote areas were limited to very few opportunities. With the internet becoming more and more accessible every day so is the forex market. You do not have to live in a city to trade or even have to travel to the brokerage to open your trading account. You simply fill out an online form and submit the required documents and voila, you can start your trading journey.

Free Forex Trading Courses

There are many education providers in the currency markets. You get everything from expensive expert courses to free online courses. A lot of free information is available. Especially for the Metatrader 4 platform, which we discuss in detail here: Metatrader 4 – Why is it so Popular?

One of the most popular courses for forex trading is found at BabyPips.com. This course is free and starts off with the basics and delves into complex theories like Elliot Waves and other trading strategies. Unlike other markets, you can get tons of information for free and educate yourself without spending a cent.

Analyzing Financial Markets and Events

Human beings, as part of our nature, love to analyze. Traders enjoy analyzing different economic events and data to try and predict movements in the market. Access to free research, tools, and reports, makes it possible for traders to come up with complex strategies. The strategy is a huge part in forex trading South Africa, and the development of that strategy is often a huge thrill for the participants in the market.

All these reasons combined make for a very attractive offering. It is very important to be aware of all the risks in forex trading. You should never use money that you cannot afford to lose when trading the forex market.

How Does Brexit Influence the Trading Market?

Brexit Influence on Trading Market

‘Brexit’ in the trading world has become almost a sort of taboo topic. In the month of October alone, there have been 17 significant happenings with regard to the Brexit debate, and the deadline for a set decision is nearly here.

What effect will Brexit have on the trading market?

Should the UK leave the European Union, and how will this influence the future of trading?

Back when Brexit was announced as a possible move forward for the UK, the forex market took a fall with the British pound dropping with 10% at the level of 1.3230 to the dollar (the lowest since 1985), and the Euro dropping with 4% to the level of 1.0945 to the dollar. EUR/JPY also suffered greatly, reaching an all time low for the last 15 years. If these trends are expected to carry through and possibly worsen when Brexit happens, what is foreseen for the future of the trading market?

Both the British pound and the Euro are expected to remain under pressure and investors are likely to tread safer areas as far as finances are concerned. The likelihood that these currencies will experience a greater decline is also not a far-fetched idea, and a recession may be imminent taking into consideration the uncertainty around global markets and little hope for recovery anytime soon should the losses be fatal.

So, how do traders protect themselves in the event of a Brexit fallout and the worst-case scenarios come into play? The best moves may be to not take risks for the moment being – playing it safe and scouting out the market before moving forward with a risky trade is in your best interest. Try not to commit to long term deals as yet. The future may seem bleak, but a contingency plan like monitoring the market may help you spot trends and avoid the worst of the negative effects on the market by taking calculated steps.

Why Trade Forex in South Africa?

The Forex Market

Understand how cfds work when you trade forex?

The High Risk of Losing

Risk Management for forex trading

Some risk management tools include:

So, why trade online in South Africa? Here are four reasons:

1. The South African economy is strong and stable.

South African financial regulatory framework

Over-the-Counter Derivatives Provider (ODP) Regulation

2. The forex trading community in South Africa.

Alternative ways to make money in the forex industry in South Africa.

3. The South African rand is a major currency.

The price of a currency

Some of the factors that can affect the price of a currency include:

So, why trade the USD/ZAR?

The Strength of the Dollar

Another Popular currency pair is EUR/USD

4. Reputable forex brokers in South Africa who have an ODP

Learn how to trade forex

Conclusion

Khwezi a regulated FSP 44816 and fully licenced ODP

The Best Time to Trade Forex in South Africa

There are 3 key factors to consider when and how to trade Forex

Understanding the best times to Trade Forex in South Africa

Forex Market Hours in South Africa

This article focuses on the top 4 major market sessions affecting Forex trading

How to decide which markets to trade

The best time to trade gold in South Africa

The price of gold

Further Reading

South African Forex Market Drivers

There are various Forex trading markets in South Africa. Let’s have a look at the 5 most alluring elements of the Forex Market for South Africans.

Low Entry Cost

Leverage in the Currency Market

Forex Trading South Africa – Trade from Anywhere

Free Forex Trading Courses

Analyzing Financial Markets and Events

Further reading:

Brexit Influence on Trading Market

What effect will Brexit have on the trading market?

Further reading: