In Forex there are several currency pairs which you can trade, selling one currency and simultaneously buying another. There is not a centralised exchange market, which opens in Sydney and then moves to Tokyo, London and New York, making it available 24 hours a day except weekends. Those who trade this market obtain profit from the difference between the two currencies prices.
Formed in the '70s, the Forex market has evolved and nowadays has an average daily turnover of about 3.2 trillion dollars. There are some things that every participant in this market should know. One of them is that Forex trading is an investment; one cannot consider it a traditional source of income. In the past, it was dominated by banks, including central banks, commercial, and investment. The development of Forex market is fast and it includes large multinational businesses, global money managers, authorised dealers, international financial brokers, futures and options traders and individual investors. For trading Foreign Exchange there are many available platforms, some offered by large investment banks. As in any domain, the terminology is very important to be known, along with a good planed trading strategy. One should also know that there are two types of analysis when it comes to currencies prices: the fundamental analysis and the technical analysis. Forex trades over 50 currencies and each one of them represents a brand like oil, gas or gold. Therefore, one can consult and exchange opinions on Forex forums with others that are trading for a long time and can give helpful advices or with those who are beginners and need additional information.
The currency rate fluctuates and is determined based on supply and demand, but may be influenced by external factors such as economic development, certain events in a given country and in the world, news on the market or a change in "market psychology". This fundamental applies generally to any market no matter what it trades (goods or values). One can read about these external factors from different sites or a Forex forum with daily news regarding the market changes, or from media. A proper analysis of the market is recommended when these news or influencing factors appear. The most traded currencies are those from countries with a stable government, low inflation rates and strong banks. These include the British pound, U.S. dollar, Euro and Japanese Yen along with others. Like any investment, currency trading has risks besides earnings. One of them, and the biggest, would be that the trader risks losing all his money without having the right knowledge. But there are tools that help traders to circumvent this risk, among them being "take profits" (minimum price should be fixed up to be received or paid), "stop loss" (a currency is sold at a predetermined price to limit potential losses if the market would take a bad turn), OCO (one cancels the other), IF-Than. All these orders can be placed online and are available to all traders. Along with this tools are different tactics that take account of technical factors (e.g.: graphs, trend lines) and the principles of Economy.
Forex trading may look like gambling, as some authors sustain, but should not be confused with them because there are many differences. The ones who choose to participate on this market should be well informed and have the right knowledge and tools.
Formed in the '70s, the Forex market has evolved and nowadays has an average daily turnover of about 3.2 trillion dollars. There are some things that every participant in this market should know. One of them is that Forex trading is an investment; one cannot consider it a traditional source of income. In the past, it was dominated by banks, including central banks, commercial, and investment. The development of Forex market is fast and it includes large multinational businesses, global money managers, authorised dealers, international financial brokers, futures and options traders and individual investors. For trading Foreign Exchange there are many available platforms, some offered by large investment banks. As in any domain, the terminology is very important to be known, along with a good planed trading strategy. One should also know that there are two types of analysis when it comes to currencies prices: the fundamental analysis and the technical analysis. Forex trades over 50 currencies and each one of them represents a brand like oil, gas or gold. Therefore, one can consult and exchange opinions on Forex forums with others that are trading for a long time and can give helpful advices or with those who are beginners and need additional information.
The currency rate fluctuates and is determined based on supply and demand, but may be influenced by external factors such as economic development, certain events in a given country and in the world, news on the market or a change in "market psychology". This fundamental applies generally to any market no matter what it trades (goods or values). One can read about these external factors from different sites or a Forex forum with daily news regarding the market changes, or from media. A proper analysis of the market is recommended when these news or influencing factors appear. The most traded currencies are those from countries with a stable government, low inflation rates and strong banks. These include the British pound, U.S. dollar, Euro and Japanese Yen along with others. Like any investment, currency trading has risks besides earnings. One of them, and the biggest, would be that the trader risks losing all his money without having the right knowledge. But there are tools that help traders to circumvent this risk, among them being "take profits" (minimum price should be fixed up to be received or paid), "stop loss" (a currency is sold at a predetermined price to limit potential losses if the market would take a bad turn), OCO (one cancels the other), IF-Than. All these orders can be placed online and are available to all traders. Along with this tools are different tactics that take account of technical factors (e.g.: graphs, trend lines) and the principles of Economy.
Forex trading may look like gambling, as some authors sustain, but should not be confused with them because there are many differences. The ones who choose to participate on this market should be well informed and have the right knowledge and tools.
