Forex and Crypto Currencies – Learn How to Trade in Dubai

Forex and Crypto Currencies – Learn How to Trade in Dubai

Forex and Crypto trading

Dubai was an established market for real estate, which unfortunately gave way and suffered huge losses. This was when Forex (FX) trading picked up in Dubai. Forex is a global market for trading currencies from across the globe.  One of the best aspects of the Dubai FX market is that it is tax-free. So, when a trader racks up a profit, it is huge but losses can also be as high too.  Cryptocurrency, on the other hand, is a digital currency, traded, online. It is a decentralized market. Both are speculative markets along with being highly volatile. So if you are planning on trading in FX as well as dabbling in Crypto currencies, especially in Dubai, you may need to learn and know a few facts for starters.

Hence before a heads up on trading in Dubai FX and crypto currency scenario, it would be of essence to understand a few quick traits specific to the Dubai FX market, especially. Perhaps the most asked question for expats and others as well, is about the legal status of trading, in Dubai. Fortunately, it is legal to trade in both FX and Crypto currencies in Dubai. The only catch is the Swap-free accounts or the Islamic accounts as they are called, for FX trading. Dubai based, Kishore M, FX and Crypto currency expert states, “Swap is the commission or an interest, which a broker gets from a trader for holding a position in the market for a long time. Since “interest” is not allowed under the Sharia law, the brokers do not charge any commission for holding a position. This is eventually is a loss for the brokers. Hence the swap-free accounts end up being a little expensive”.

To trade in the Dubai FX market, a trader has a few things to learn.

Understand the market:

Research is the key to success. Follow past market patterns, understand the volatility of the market, understand and analyse strategies that have worked and failed and draw your own conclusions.  Most importantly, understand the currency pairings.

Demo account:

It would not be advisable to go into the market for trading immediately. With research in place and some understanding, a trader must give himself the chance to dabble in the FX market, in a practice environment. While trading in that environment, a trader develops his or her strategies via trial and error. The real market may be a bigger place but the feel in the demo account, more than helps to prepare.

Reputed brokers:

FX is a market where a trader can enter only through a broker, especially when he is into online Forex trading.  A broker or a brokerage firm will make trading platforms available to the trader. In Dubai, there are many broker firms who provide traders with a demo account too.

However, the need for a broker is not limited to FX market and tools access. Leverage is a facility that is given by a broker to a trader. A leverage is a loan that a broker gives a trader for investment in the FX market. This in a way makes the broker as interested a party to thetrading profits as the trader himself. Hence many a times, brokers start interfering with decisions on trading. This is where it becomes a problem

Do not over leverage:

Leverage is a facility, which is also a cost and finally a temptation.  When a trader enters the market he already has costs to bear: the broker’s fees, their spreads and the leverage. Overleveraging will only accentuate a trader’s costs.

Learn to use Stop loss:

While trading, never overlook setting the “stop-loss” checks. A trader must predefine how much loss is he ready to bear. Likewise, he should set the stop loss checks. This makes sure that the trading profits are secure, without emotions interfering with trading decisions. Kishore M states,” When a trader starts losing money, he may give in to his hope of getting back what he lost, thereby trading more and losing more money. Stop loss checks close a trading position once losses reach that point of check, thereby prohibiting anymore trading”.

Get the sidekicks right:

Trade timings and days are the sidekicks, a trader should not ignore. The four major FX exchanges, namely: London, NY, Tokyo and Singapore, operate during their own time zones, which are never in sync. Hence, the FX market, as a whole, is always open, as someone or the other is open to trade. Knowing the timings and the days, best for trading is always a smart move.

Trading in Dubai FX

Understand the market

Demo account

Reputed brokers

Do not over leverage

Learn to use Stop loss

Get the best time and days to trade right

To trade in crypto, here are a few dos that need to be understood.

Converting fiat cash to crypto:

To start trading in crypto currencies, a trader cannot make investments in fiat money. This must be converted to crypto currency. The only way to convert the fiat money to crypto currency is through a local exchange, that a trader hasto register with, beforehand. This registration has a fee attached to it.

Calculate your first investment:

The process of trading in crypto currencies is a three-phase journey. A trader puts in his fiat money and transfers it to a local crypto exchange. In the local exchange, it will become a Bitcoin or an Ethereum or a local crypto currency for a fee. This converted currency will now have to be transferred to a crypto currency exchange, where the trader will buy coins worth his Crypto currency valuation. Till now a trader loses money in fees, which comes up to quite a bit.Hence it is important to ensure that the initial investment is a good amount, enough to gain the trader a good portion of a crypto coin, post all the fees, paid.

Use the wallet:

Once a trader buys a particular Crypto currency, he has his choices: Either leave the coin as it is in the exchange or wait for the right time to sell or transfer it to the wallet for safekeeping and wait for the correct time. Leaving it at the exchange is risky. It is therefore always advised that traders use wallets (either online or offline) to avoid any kind of mishap.

Learn to compare:

As a trader keeping a track of the volumes that are trading is a must. The volumes in the crypto currency market are the cumulative trading of all the crypto currencies that are being tracked. This ensures that an excellent selling or buying opportunity is not missed.

Do not go on crash price hunt:

It is in human nature, to play safe and to bet on hope, for things to look better. As a trader, when this psychology plays the lead, traders tend to look for currencies that crashed last or doing badly at the moment. This for them, is the apt currency to buy because of the low price. The fact is, the crypto market is volatile. However as a trend, once a currency falls, it takes a time for that currency to catch up. Like in the case of Aurora, which spiked to an all-time high as compared to Bitcoin, in 2014?That year, One Aurora was valued at 0.00014 Bitcoins. By 2018 April, Aurora was being sold at 999% discount whereas Bitcoin has become synonymous with crypto currencies.

Trading is risky:

A speculative market is always highly volatile. Profits can be huge as can be the losses. Hence, while trading in crypto currencies, do not overlook the safer trading options like stocks.

Trading in Crypto currencies

Converting flat cash to crypto

Calculate your first investment

Use the wallet

Learn to compare

Do not go on crash price hunt

Trading is risky


Trading in FX and in Crypto currencies is all about speculation. Both are highly volatile markets and are affected by world events. However, a major difference in between FX and Crypto currency markets is, that political unrest and economical challenges leaves its imprint on the FX market. However, the Crypto currency market is affected only when policies and laws are passed directly about Crypto currencies. They both promise rich gains but none come without perils. Trading is a guessing game. A right guess is as good as it gets here.