However, there is a little issue — most Forex trading strategies assume that you are starting with 500 USD at the absolute least. And then there are guides that demand 5 to 10 thousand.
However, what if I told you, that you can start lower? For example, with 50 USD. It won’t be easy but you can do it. And with this article, we’ll tell you how.
Forex is a foreign currency exchange that exists to supply the international trade with local money. This market has been designed for large-scale traders and is focused almost entirely on them. The lowest amount of currency you can purchase on the market is a micro lot, equal to 100 units. Which for all currency majors far exceeds our 50 USD limit.
However, there is another way to trade on Forex — with Contracts For Difference (CFDs). These are agreements made between the broker and its clients and do not involve the Forex market itself — which allows them to be of any value you want. Even 1 USD, if you so desire.
CFDs are awesome because they allow to streamline the whole trading process and leave only the parts that actually matter. Here are the advantages of trading Forex CFDs:
Overall, CFD trading is a lot cheaper and provides you with a much lower starting barrier. The recommended amount is 500 USD, but you can start with any amount of money you want. For example, with 50 USD.
There are two ways to trade on Forex — a fast one and a slow one.
Fast trading is also known as scalping and involves micromovements — minuscule price movements that constantly occur on any currency pair. Scalping is the most profitable Forex trading strategy and, provided that everything goes well, can bring you up to 100% monthly profits. The key word, of course, is “if everything goes well”. The safest scalping strategy is Lazy River Scalping and even it is not completely reliable. And since with 50 USD you can’t take a direct hit like that, you‘ll have to use slower trading strategies based on Price Action.
Price Action is a set of the Forex market rules, derived over the course of 10 years by the members of the ForexFactory community. It explains how you should trade during different states of the market. For example, when you see a pattern known as a “Pin bar”, you should open order in a direction opposite to the market movement direction.
Price Action trading makes for reliable strategy, but don’t expect to go over 10% of the weekly profit. This means that with a starting capital of 50 USD, you will get 55 USD back at the end of the week. Should you reinvest them, you will get back 60 USD. After ten weeks, you will have 130 USD. It’s up to you to decide when you want to start taking the money out of it, but ideally, you should have at least a 500 USD deposit before you should consider doing so.
The best Forex CFD broker is JustForex — an international broker that has been working in South Africa since 2013. The company is reputable and provide excellent support to its customers.
To start trading with JustForex:
From that point on, you can deposit money and trade free. In fact, JustForex will give you a gift. Also, JustForex currently has a 50% bonus on deposits less than 100 USD. This will turn your 50 USD into 75 USD and allow you to make money faster.