You should read the links others have posted, but I'll give you a quick rundown.
You or someone else makes a trade thread.
You or someone else posts in that trade thread.
You and someone else agree to trade, either in the thread or through pm (this part is better done through the thread, but is usually done in pm)
You or someone else messages the other party a game to join.
Both parties join the game, and state their own jsp name.
One player usually states what's being traded for what (eg., "brett1337walker here, 1 soj @ 7fg")
The two players exchange items and/or forum gold. (There is a widely-accepted, but not forum-condoned, 2/3s rule, in which the player with less of two of the three categories fg, post count, or join date, will give their items or fg first).
Each player says "t4t" and leaves happy with their new fg or item.