TRADING WORLD MARKETS WITH TRADING CENTER

🏆 The Essentials of Successful Trading

Know what you are trading and become an expert in fundamental analysis by also following major events that can quickly shift market momentum. Study charts on higher timeframes and use selected TA tools and signals such as MACD and RSI divergences. Track what the “big players” are doing through reports like the COT, and take a contrarian stance against the crowd that is often wrong. Don’t try to outsmart the market, respect uncertainty and manage your risk by always keeping your portfolio diversified. Have a trade plan and use detailed setups to follow it with discipline. Let your profits run with trailing stops, and cut your losses short. In the long run, over 80% of your profits comes from less than 20% of your positions.

Starting with the Foreign Exchange market and continuing with equities, commodities, and digital currencies, this guide reveals everything you need to know before trading the global financial markets.

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① The Foreign Exchange Market

The Foreign Exchange is the largest financial market in the world, and the 'place' where international currencies are traded against each other. Forex is a decentralized market with no central location, as transactions are carried out through the electronic network of banks (ECN).

• Operating continuously 24 hours a day, five days a week, from 10:00 GMT Sunday (Sydney opens) to 10:00 GMT Friday (New York closes) with overlapping sessions

In its early years, the Forex market was relatively small. In 1977, the average daily turnover was just $6 billion. By 1987, this figure had surged to $600 billion per day, and by 1997 it reached $1.2 trillion daily. The growth continued, with daily turnover hitting $3.2 trillion in 2007, and today, it is estimated at $7 trillion daily (BIS, 2022).

To analyze the Forex market, currency traders primarily employ fundamental analysis, technical analysis, and seasonal statistics. (press the slider)

Trading in the Foreign Exchange Market

Hundreds of different currency pairs are offered in the Forex market. However, the three major pairs in terms of liquidity, activity, and tight spreads are EUR/USD, USD/JPY, and GBP/USD. Overall, these are the pairs that offer the best trading conditions.

» EURUSD

» GBPUSD

» USDJPY

» USDCHF

» USDCAD

» AUDUSD

» NZDUSD

» EURGBP

» EURJPY

All you need to start trading Forex is an account with an online broker and a trading platform, which is provided for free.

Forex Brokers

Forex brokers provide their clients with access to the Foreign Exchange market. There are two main categories of brokers: 🔗 More about Forex Brokers 

• ECN/STP Brokers (No-Dealing-Desk)
• Market Makers (Dealing-Desk firms)

📌 Tip: It is important to stick with ECN/STP brokers, as these NDD brokers provide tighter spreads, faster order execution, and have no conflicts of interest with their clients.

Automated Forex Trading 🔗 Automated Forex Strategies

Automated trading uses computer software and hardware to enable continuous trading without human intervention. An automated Forex trading system analyzes key market data, like price and volume, to identify and trade short-term trends. It can assess supply and demand dynamics and, by comparing them with historical price patterns, decide what and when to trade. 🔗 Forex Trading Books

🔗 More: » The Foreign Exchange Market (Forex)

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② Trading Stocks and Indices

Stock investing is a challenging task that involves gathering key information (macro, industry, etc.) and then selecting stocks through careful analysis. Equity traders can access thousands of stocks and indices worldwide through various trading platforms and hundreds of brokers.

Fundamental Analysis

The main goal of a fundamentalist is to find financial securities priced below their fair market value. Fundamental analysis aims not only to estimate fair value but also to identify and assess the risk of each investment. Risk assessment is essential for effective portfolio management. It’s all about Risk/Reward. 🔗 Stock-Trading Books

The two main goals of fundamental analysis are:

(1) Determine the fair value of financial securities (profit potential)

(2) Identify and measure risk (loss potential)

Financial Ratios

Financial ratios are commonly used to compare companies and industries across various aspects, including profitability, dividends, book value, and more. For a company, ratio analysis is based on the current share price or the overall market value (capitalization). 🔗 Financial Ratios

Investment Valuation Methods

Assessing true value is crucial for profitable stock-market decisions, using five key methods: Revenue, Earnings, Cash-Flow, Equity, and Empirical-Based Valuation. 🔗 Investment Valuation

Technical Analysis

Charles Dow (1851–1902) is known as the father of modern equity technical analysis. His ideas, later called Dow Theory, explain how markets move in trends and pass through different phases. Other analysts, such as Ralph Nelson Elliott, later expanded on his work.

These are the key technical analysis tools for equity traders (press the slider)

The Dow Jones Industrial Average 🔗 The Dow Jones

The Dow Jones Industrial Average (DJIA) is one of the most important indices in the US and worldwide. Introduced in 1896 by Charles Dow, it originally measured the stock prices of the largest US industrial companies but later expanded to include firms from various industries. Over time, the DJIA has become a key indicator of global political and economic trends. If an equity-trading strategy doesn’t work on the Dow, it likely won’t work on any other index.

🔗 More: » Equity Trading at TradingCenter

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③ Trading Commodities

Commodity prices are mainly driven by supply and demand. However, other factors can affect this balance, including geopolitical tensions, the stage of the economic cycle, currency fluctuations (especially the US dollar, which is the main commodity pricing currency), and production disruptions caused by weather. Commodity traders use futures contracts, options, and other financial instruments to profit from price swings or to reduce market risks. Commodity trading may prove very profitable if you can recognize and follow the long-term commodity cycles.

□ The most important commodity assets, for different reasons, are Gold and Crude Oil.

Gold Price History: A Comprehensive Overview  🔗 Find out more: » Historical Price of Gold

For hundreds of years, the gold price remained stable under systems like the Gold Standard and Bretton Woods, which are discussed later. However, after the 1970s, gold prices began to rise sharply due to high inflation and geopolitical tensions. These price movements reflect gold’s dual role as both a commodity and a tool for diversified portfolio risk.

Historically, gold was used as the world’s currency, and during financial crises, many investors view it as a “Safe Haven.” In such times, gold prices tend to rise sharply without any pauses or corrections. Investor psychology plays a key role in gold price movements, often outweighing the basic rules of supply and demand. In 2009, during the financial crisis, demand for gold dropped by 32%, yet prices still rose significantly. » Commodity-Trading Books

Fundamental Highlights

• 208,000 metric tons of Gold is the total quantity that was ever mined (until 2024)
• Jewelry has used 95,000 tons, Central Banks 35,000 tons, Investment (bars, coins, etc.) 50,000 tons, and 30,000 went to manufacturing (electronics, space, etc.)
• Around 3,000–3,500 metric tons of Gold are mined per year (Top producing countries include China, Russia, Australia, Canada, and the U.S.)
• 25% of the new gold supply comes from recycling

Navigating Crude Oil Market Volatility 🔗 Basic Information About Oil Trading

Historically, oil prices have ranged widely from 30 to 150 US dollars per barrel. Capital leverage in derivative markets helps explain the large short-term fluctuations.

Fundamental Highlights

• More than 1 million WTI contracts are traded daily on CME Group, with over 4 million contracts open at any time. This creates significant price pressure that is mostly separate from the actual physical demand for oil.

• OECD oil consumption is falling by 1.2% per year, while Asia—especially India—is driving 75% of global demand growth (India’s demand is increasing by 500,000 barrels per day each year).

• Key oil producers in 2025 are OPEC+ with 43%, the USA with 13%, and Russia with 11% of global oil production. Saudi Aramco is the world’s top producer, with 9.7 million barrels per day—making up 9.7% of total oil production.

🔗 More: » Trading Commodities at TradingCenter

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④ Bitcoin Markets

Created in 2008 by Satoshi Nakamoto, Bitcoin is the first and most widely used digital currency in the world. You can trade Bitcoin through an ETF or buy it directly from a Bitcoin exchange (details provided at the end).

Fundamental Highlights

• Limited Supply: The total number of Bitcoins is capped at 21 million, introducing built-in scarcity similar to gold.
• Decentralization: Bitcoin operates without a central authority, supported by a distributed network of computers (known as "nodes") around the world.
• Pseudonymity: Bitcoin transactions are tied to encrypted wallet addresses rather than personal identities, offering a degree of privacy.
• Security: Transactions are protected through cryptographic methods and validated by miners using a proof-of-work system.
• Market Volatility: Bitcoin’s market price is highly volatile, which contributes to its reputation as a highly speculative investment.

🔗 More: » The Bitcoin Basics

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⑤ Contracts for Difference –CFDs 🔗 Compare CFD Brokers

A CFD contract exchanges the difference between the entry and exit price of a financial asset. CFDs can be used to speculate on stocks, indices, currencies, commodities, or other assets (like volatility or inflation) and involve two prices: the opening price and the closing price. If the underlying asset rises, the contract buyer is paid by the issuer. CFDs do not have a specific expiry date like options. They are renewed at the close of each trading day and, depending on the trader’s choice, are either rolled forward or closed. 

📌 Tip: If you are a swing trader, get familiar with CFDs on Futures. With this instrument, you can trade both market directions using leverage without paying overnight costs. By accepting a slightly higher trading spread, you can avoid negative swap rates entirely—making it an ideal tool for letting your profits run.

 

🔗 More: » Learning at Trading Center | » Training on TradingCenter

 

■ Trading World Markets with TradingCenter.org

Giorgos Protonotarios, Financial Analyst

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