How To Start Forex Trading In India

How to start trading in India: step-by-step guide

Here is a step-by-step guide on how to start Forex trading in India:

• Choose a SEBI-registered broker
  Your first task is selecting an online broker that SEBI regulates. Choose the one tailored to your trading needs from a list of eligible brokers. Consider fees, customer service, security features, and available account types. Reliability is important, as the broker is the intermediary for all your trading transactions. You can also consider working with one of the international forex brokers that accept clients from India.

• Open DEMAT and trading account
  Proceed by opening a DEMAT and trading account, essential for managing electronic shares and executing financial instrument transactions. This involves submitting necessary documents for KYC verification, including a PAN (Permanent Account Number) card, address proof (such as an Aadhar Card), and identity proof (such as a 10th Marksheet). As stipulated by the broker, an initial deposit is required, followed by the approval of your accounts.

• Login and fund your account
  Upon opening your accounts, login using provided credentials. Deposit funds via online banking or net banking into your trading account. Remember that profits from online trading must be declared for taxation under the head “Profits and gains from business or profession.”

• Develop a trading strategy
  Gain proficiency in both fundamental and technical analyses of stocks to strategize your trades. Fundamental analysis assesses a security's intrinsic value, considering earnings, expenses, assets, and liabilities. For Indian Forex trading, focus on macroeconomic events affecting the USD/INR pair. A second study, technical analysis, relies on past price and volume charts to predict future potential. This science is universal regardless of the country or asset.

• Analyse the currency pair and start trading
  Access your demat and Forex trading app to view live market data, research stocks, and obtain detailed information about companies and share prices. Execute buy/sell orders using your broker's online platform. Regularly monitor and assess your trades to optimize profits and minimize losses. Understanding the markets and developing a strategy aligned with your risk appetite and goals is crucial.

• Learn proper risk management
  Given the inherent volatility of the Indian financial markets, beginners must grasp the art of preventing significant losses. When executing a trade, set a stop-loss price to minimize potential losses. Failing to implement a stop-loss strategy can have detrimental effects on your capital.

How to start trading in India - 5 essential tips

• Educate yourself about the Indian Forex market
  Initiate your trading journey with an understanding of how the Indian financial markets work. Invest time in learning the fundamentals of the Forex market, including concepts such as market analysis, Forex trading strategies, and risk management. Know about the specific restrictions on Forex trading placed by SEBI. Utilize educational resources, courses, and reputable financial literature to build a solid foundation for your future endeavors.

• Choose a reliable broker and get a strong internet connection
  Choose a broker with a stellar reputation and reliability in the market. Regulation for brokers must be a hygiene factor. Research different brokers, considering fees, customer service, ease of use, and security features. A reliable broker is a crucial partner, facilitating your trades, providing valuable market insights, and ensuring a secure and efficient trading experience. Additionally, make sure that your internet provider enables seamless connectivity.

• Start small
  Initiate your trading journey with a modest investment. Starting small allows you to manage risks effectively and gain practical experience without exposing yourself to significant financial loss. As you become more familiar with the dynamics of the Indian market and your risk tolerance, you can gradually increase your investment.

• Trading strategy
  Develop a clear trading formula and adhere to it. Your formula should include criteria for entering and exiting trades, risk management strategies, and guidelines for portfolio allocation. Instead of chasing immediate profits, having a consistent and disciplined approach to learn Forex trading.

• Control your emotions
  Emotional control is very important in trading. Resist impulsive decisions driven by fear, greed, or other emotions that can cloud judgment. Maintain a disciplined and rational mindset, focusing on your predetermined trading strategy. Regularly assess your emotional state and its potential impact on your decision-making, and take breaks if needed to regain objectivity.

Best Forex trading time in India

The prime window for Forex trading coincides with overlapping sessions, characterized by heightened trader participation and increased trading volumes. This scenario results in improved order executions, minimized slippage risks, and narrower spreads for currency pairs.

Experts suggest that the best periods for Forex trading are between 6.00-12.00 GMT and 18.00-0.00 GMT, attaining peak profitability during these intervals.

When considering day trading in India, the opening hour of each week significantly influences market dynamics, especially after significant weekend financial events. The Sydney session, with lower volatility, kicks off the trading week. As the Tokyo session follows suit, encompassing Singapore, China, and neighboring nations, volatility escalates. The start of the London session saw a further surge in volatility, driven by European investors, hedge funds, and central banks. Trading peaks during the initiation of the New York session, maintaining heightened volatility for three to four hours. Subsequently, as the London session concluded, volatility gradually receded, reaching a low point with the conclusion of the New York session.

In India, the session overlaps occur during specific GMT hours

• Sydney and Tokyo sessions overlap: 23.00 GMT to 7.00 GMT

• Tokyo and London sessions overlap: 8.00 GMT to 9.00 GMT

• London and New York sessions overlap: 13.00 GMT to 17.00 GMT

Research conducted by the Traders Union experts suggests that Thursdays and Fridays exhibit heightened liquidity and price fluctuations, making them ideal for more active trading. In contrast, Tuesdays and Wednesdays tend to be more stable. Mondays are influenced by various economic factors and statistics, setting the tone for the following days. Notably, the Forex market experiences reduced activity on Saturdays and Sundays.

What are the best Forex pairs to trade in Indian local time?

The prime window for Forex trading in India spans from 17:30 IST to 20:30 IST, notably during the overlap of the European and US market sessions. This timeframe ensures maximum market liquidity and heightened trading volumes, making it a good window for engaging with US dollar-related pairs.

Best Forex brokers in India

Exness

Exness Review

Open an account

Your capital is at risk.
You can lose your money.

Exness has been in operation since 2008. Exness is the best broker for both active and passive investment. It offers a wide variety of trading instruments along with reliability and innovation. The broker offers a range of accounts, depending on the needs of traders. For beginners, the broker offers cent and demo accounts, and for active traders, ECH accounts with low spreads from 0.1 pip.

Exness offers services via registered offices in the British Virgin Islands, Seychelles, Curaçao, South Africa, and Cyprus. Retail customers cannot get services from Cyprus or the United Kingdom offices.

Exness is governed by the strictest regulatory agencies, including the Cyprus Securities and Exchange Commission (CySEC) and the UK's Financial Conduct Authority (FCA) . Exness is subject to financial services authority (FSA) and FSCA egulation as a securities dealer (South Africa).

Trading Instruments

Currencies, assets of stock and commodity markets, cryptocurrencies.

Commissions

Standard Account EUR/USD Average Spread 1 pip, ECN/STP Account Fee $3.5 per lot.

Roboforex

RoboForex Review

Open an account

Your capital is at risk.

In 2009, RoboForex Ltd. was established. Since it entered the market, RoboForex has been offering trading services globally for Forex brokers. The broker specializes in trading automation solutions such as the CopyFx auto trading platform and the bot builder. RoboForex supports 12,000+ CFDs and direct trading in US shares with extra low fees of 0.09 cents per share.

The account type selected on the interface at RoboForex will determine the spreads. For EUR USD, the spreads range from 0.03 to 1.4 pips for different account types. RoboForex provides a 0% fee on all deposits and withdrawals.

RoboForex is generally governed by Belize's Financial Services Commission. The broker also has a European legal entity with regulation in Cyprus (CySec). At RoboForex, a civil liability insurance program offers industry-leading defense against errors, fraud, omissions, negligence, and other risks that might result in losses for clients.

Trading Instruments

RoboForex supports Forex stock, and crypto trading. The broker provides access to trading a total of 12,000+ trading assets.

Commissions

In the CFD market, the broker uses spread as the commission. In the Forex market, the commission depends on the chosen account. The typical spread is from 0.3 pips, ECN account trading fee is $1-$2 per lot.

OctaFX

Octa Review

Open an account

Your capital is at risk.

OctaFX is a Forex Broker that offers Forex ECN trading and CFD trading on indices, metals, and cryptocurrencies across the MT4 and MT5 trading platforms. OctaFX offers a wide range of trading accounts, access to copy trading, bonus promotions, and a wide range of research tools.

The Cyprus Securities and Exchange CySEC, FCA (UK), and IFSA (St Vincent and the Grenadines) have also regulated this company.

OctaFX strives to provide favorable and transparent conditions to all Forex traders, regardless of their experience and trading skills. So, spreads start at 0.6 pips, there are no commissions for replenishment and withdrawal of funds, and all trading strategies are allowed.

Trading Instruments

OctaFX offers Forex and CFD Trading.

Commissions

Standard Account EUR/USD Average Spread 0.7 pips.

Pros and Cons of Forex trading in India