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1. Become comfortable with the nature of the FOREX market. This includes learning such terms as 'exchange rate,' 'currency pair,' 'ask price' and 'bid price.' You can find definitions and broader perspectives by typing these terms into a search engine, such as Google. Once these concepts are fully understood, learn about the function of the FOREX market, including the reasons people exchange currencies as well as the effects of political regimes, wars and natural disasters on exchange rate levels. Financial resource websites as well as FOREX websites (see Resources) provide articles which can provide clear insight into these latter concepts.
2. Become familiar with the logic which underlies trade decisions. The purchase and sale of currency in the FOREX trading environment comprises careful decision making based on a tool called technical analysis. Technical analysis studies the movements in exchange rates for specific currency pairs over some length of time. By examining patterns in the charted movements, it is possible to forecast the direction of exchange rates in the near future. The first step in learning about technical analysis will be to understand the components of a candlestick graph, several of which, side by side, make up the time-series chart just described. Again, financial websites as well as FOREX website tutorials provide solid materials for learning the fundamentals of technical analysis. Focus only on understanding fundamental concepts such as the candlestick graph and time-series chart. A deeper understanding of technical analysis is ongoing with progressive use in trading, aided by strategy tips, news updates and articles provided by the FOREX website through which you trade.
3. Enter terms such as 'forex brokers' or 'online forex trading' into a search engine. Select a FOREX trading website. This may be a site which you can use as a trading platform, but you should select one that provides FOREX training materials which suit you best. All FOREX websites provide learning materials and tutorials which cover currency trading from the basics on how to use the trading software to more sophisticated concepts, such as regional trading schedules. In most cases, these learning materials are provided free of charge and do not require that you register with the site, while others do require a fee. The amount of material provided varies from site to site and you do not have to necessarily review the entirety of it. It is best to find articles and tutorials which will build on the basic concepts that you have already learned.
4. Once you have reviewed the articles and tutorials provided and feel you understand how to use the site's trading software, then you are ready to begin honing your trading skills in a risk-free manner using the 'demo' trading account provided upon registration with the site. This account, also called a 'practice' account, is usually active for 30 days and allows the new trader to make simulated trades in a real-time environment reflecting actual exchange rate movements. Additionally, it will allow you to become more familiar with how to quickly and effectively use the software and its functions. You should use this practice feature as much as possible in the time frame during which it is available before executing any trades using your own money.