The forex market is the world’s largest and most liquid financial market, with an average cumulative trading volume of over $3 trillion, offering forex traders from all over the world the chance to profit from fluctuations in market prices.
It’s one of the most coveted careers, due to the freedom it gives to those who are consistently profitable. However, the forex market is dynamic, and it’s always evolving, solely driven by the constant changes in regulations, technological advancements, and shifting trends in the market.
In this write-up, we are going to explore some of the trends to watch out for in the forex trading industry.
Prevalence of Cryptocurrency Trading
When the world was introduced to crypto trading, it took us all by storm, and some of us were skeptical at first since we didn’t know what to make of it. Bitcoin was the inception of all the other cryptocurrencies since its launch in 2009.
Most forex brokers have been quick to inculcate cryptocurrencies into their platforms, offering crypto traders the opportunity to gain some profit from cryptocurrency trading.
Thanks to the decentralization of cryptocurrencies and the fact that crypto allows for anonymity, many traders worldwide have quickly embraced the asset class.
Adoption of Machine Learning and Artificial Intelligence
When I first started trading forex, all that was at my disposal was technical analysis, and that was the end of it. However, now, thanks to the proliferation of technology, there has been a steady increase in automated trading systems, which has helped forex traders make more informed decisions.
Some of these automated trading systems and expert advisors (EAs) have been programmed to analyze the market and execute trades with up to 70% accuracy rates.
Gone are the days when trading was a career for gurus. Thanks to technology, the playing field has been leveled, and even a newbie trader can reap profits from the market, provided they have some understanding of how the forex markets work.
However, it’s essential to always have a low-latency VPN, since it will ensure that the automated expert advisor will operate seamlessly.
Mobile Trading
Convenience and efficiency are the name of the game these days, and since most people are always glued to their phones, most brokers have opted to also have their applications on mobile devices. This makes it simple for traders to execute trades while on the move.
Some of the applications offered by brokers also have an inbuilt notification system, so you will always be in the know regarding the performance of your trades and can close any open positions should you be in a heavy drawdown.
Forex Education and Training
Forex trading isn’t as simple as most YouTube and Instagram gurus make it out to be. It requires a lot of backtesting and an in-depth understanding of trading strategies and trends to become consistent to the point where you can say that forex trading is paying your bills.
Due to the increasing demand for those willing to venture into forex trading, there has been a steady increase in forex consultation firms that enlighten traders who are eager to expand their knowledge of the financial markets.
Education can be in the form of trading guides, online webinars, and online courses, which mostly come at a fee. Over the next few years, we can expect to start seeing a steady increase in complex trading strategies, which could result in an increased probability of making consistent profits.
Expansion of Copy Trading
Copy trading can also be referred to as social trading, and it allows forex traders to copy the trades taken by consistently profitable traders.
This trading method is commonly used by newbie traders who may have inadequate trading experience and confidence in executing trades in the live market. Copy trading has been around for quite some time, but we can expect to start seeing a steady increase in social trading apps soon.
There are various copy trading apps and platforms like eToro, AvaTrade, ZuluTrade, IC Markets, and Naga, just to name a few. Apart from allowing traders to make money, social trading also allows traders to interact with like-minded investors, which could lead to new connections.
Final Remarks: The Future of Forex Trading: Trends to Watch Out For
Technology has been shaping our way of life for some time, and now, with the prevalence of AI, there’s more to come. Technology has also had a massive impact on trading and the forex markets in general, impacting major changes in the forex market.
