How The Markets Work? And Why The Forex Trading Market?

The Investor Diary Entry #79: May 10, 2025

hieroglyphic how the markets work

My First Encounters With the Markets

This journey started long ago. I had my first touch with financial instruments back in the 1980s when I was still a teenager. I didn’t understand what they were, how they worked, or how I could interact with them. It was just interest—pure interest in money instruments. But I didn’t know what to do with that interest.

Only many years later did I come to learn what these instruments really are. And even today, I can say the more I learn, the more I realize how much I didn’t know—and still don’t know—about how the markets work.

The Stock Market Didn’t Fit

At first, I was introduced to the stock market, but something didn’t sit right. The way it was presented to me didn’t make me feel comfortable. I didn’t know you could short a stock—that concept was completely new when I finally learned it. I always thought stock trading meant buying low, selling high, and then waiting to do it all over again.

Also, the fact that the market closes didn’t fit with my life. If the stock exchange is closed, then trading stops. That’s it. That didn’t make me feel relaxed, especially being in a different time zone. I’d have to adjust my whole schedule around market open and close times, which I wasn’t willing to do.

The Discovery of Forex

Einstein Why the Forex Trading Market

When I discovered forex trading, something clicked. It was the flexibility. The fact that I could trade any time, 24 hours a day, was exactly what I needed. Plus, the idea that I could short a currency pair or a commodity—this made sense to me. It suited the way I think and the way I wanted to engage with the market.

This is simply why the Forex Trading market. This is when I began focusing on the forex market. It became my entry point into the world of trading.

What I Didn’t Know About the Markets

Looking back, I realize how little I knew before entering this world. I didn’t know about all the other financial instruments out there—futures, options, bonds. I tried to learn about them. I really did. I read articles, watched videos. But I couldn’t grasp them. I failed to understand them. Meanwhile, people I watched online were dealing with these tools in such a relaxed way.

But for me, it wasn’t working. So I left all of that behind. Bonds, futures, options—they’re not for me, not now.

Understanding the Structure of the Market

One thing I began to see clearly is that the market is made up of different segments. There are four types of financial markets. You can search for them and find out how they affect each other. I’m not going deep into them in this entry, but knowing they exist helped me understand where forex fits in.

Each instrument in the market operates differently. Understanding even the basics of each one helped me narrow down what fits my mindset and what doesn’t.

Being in the Market Without Knowing the Market

Why the forex trading market

When I got into forex, I got excited. I thought I understood it just because it was simple to access. Just click a button, make a profit—that illusion lasted for a while. But I soon learned that trading isn’t something you just do. If I want to be in this space, I need to know what I’m doing.

That’s when I shifted into serious study. I realized that trading is a profession. And like any other profession, I needed to get the knowledge first.

My Trading Plan and Where I Stand Now

After two and a half years on a demo account, I’m still experimenting. I’ve already finalized my risk management approach and feel calm about that. But I haven’t settled on a trading methodology. I’ve done videos and blogs on indicators I’ve tested, but I haven’t reached something that feels mechanical and consistent. I’m still working on it.

That’s why I continue to concentrate on this topic. It’s part of the ten things I wish I knew before I started. Trading methodology is at the center of that.

Why Forex Still Works for Me

Despite everything, I’m still in forex. Some say forex is too slow and go for gold, indices, or other commodities. I’m not there. Not yet. For now, the slowness of forex helps me learn.

Gold might be part of my plan later, but not today. Today, I focus on forex. Once I become successful in executing what I learn here, then I’ll move into gold. That’s my structure.

Clarifying the Confusion: Trading vs. Investing

confusion trading Vs. investing

One of the biggest things I misunderstood at the beginning was the difference between trading and investing. I used to think they were the same. Now I see it differently.

Investing, in my perspective, is long term. You buy and wait. You don’t sell unless the situation demands it—like needing the money or finding a better opportunity. Shorting doesn’t exist in investing for me. You don’t sell before you buy. You buy and hold.

Trading, on the other hand, includes shorting. You can profit from downtrends. Even long-term trading, in my view, is still trading. The confusion between the two was one of the things I needed to clear up early on.

Learning From Experts (Without Being Overwhelmed)

One challenge in this journey is learning from people who already know what they’re doing. Experts often forget that beginners don’t speak the same language. They throw around terminology and forget to explain.

So I started guiding conversations with them—asking questions, stopping them when I don’t understand. That’s how I learn. I don’t nod along just to keep the conversation moving. I ask, I clarify, I repeat.

Final Thoughts for This Entry

This diary entry is the second in the series of ten lessons—the ten things I needed to know before trading forex. Today, I focused on understanding how the markets work and why I’m in forex specifically.

There are still parts I don’t fully grasp, like fundamental analysis. That’s another topic entirely. But for now, I stay in this market because it’s where I’ve spent years studying. It’s where I feel comfortable.

This is it for now. See you in the next entry.

The Investor

Saturday 10 May 2025

About The Author

I started to look into individual stocks in January 2022. I created this diary initially for myself to track my investing progress, and second, as a place where I can share my ideas publicly hoping that others will share their ideas and learn from each other, and lastly as an online business where some links that I share are affiliate links, and if anybody bought anything by clicking those links, I will get a commission based on that successful sale, which of course will not affect the price that you are buying the product or service at.

This blog is also part of something else I’m learning: blogging. I’m using a platform to learn that part. And if you’re interested in that it is called Wealthy Affiliate, look it up.

For more detailed information on my affiliate disclosure, please refer to the Full Affiliate Disclosure page.

Furthermore, this site is in no way or form giving any financial or investing advice, nor is it encouraging or discouraging people to buy or sell any financial instrument. This is a personal diary in which I track my own progress and share it for informational, educational, and entertainment purposes.


2 thoughts on “How The Markets Work? And Why The Forex Trading Market?”

  1. Really informative post. I agree Forex does seem more flexible since it’s open 24 hours on weekdays, which is a big plus compared to the stock market. I’ve looked into it before, but I haven’t tried it yet because the minimum deposit on platforms like Fortrade felt a bit high for me at the time. I did watch a video on Fortrade about how forex works, but honestly, all the technical and fundamental analysis stuff felt a bit overwhelming. Still, this post made me think about giving it another look. Appreciate you sharing your personal journey—it’s good to see someone being real about the learning curve.

    Reply
    • Hello Mohamed, I think for anything new that we want to train on, we need to go through boring “Wax left, Wax right – Karate Kid Movie” kind of training. This way our brain muscles are get trained much better for the long run.

      In the previous post, I talked about personal finance, and it touched directly on the question whether we can afford trading or not, and what to do whatever the answer was to that question.

      Reply

Leave a Comment