Forex is an exciting way lot of money. Today there are many good trading systems that are offered on the website. Before you look at currency Forex trading, it is very important a General understanding of what it is.
What is Forex trading?
The foreign exchange market also known as Forex or Fx market is the place where (money) market for currency. Every day more than 3 trillion dollars are traded. It is approximately 30 times larger than the combined volume of all U.S. equity markets (before the downturn in the stock market). Forex plays an important role in the global economy, as they buy the main players-banks, firm (export and import of goods worldwide) and traders and sell currencies 24 hours 6 days a week.
The market opens at 7: 00 am Monday morning new Zealand time and closes at 5.00 am, on Friday evening new York time. The absence of a Central shopping area, and all trade is carried out electronically with the primary dealers with headquarters in London (the trading capital), new York, Hong Kong/Singapore, Sydney and Tokyo.
As a Forex trader you will be buying and selling one currency against another. If you buy, you expect that the value of the currency will grow if you sell, you should expect that the value will fall. Forex currencies are traded in pairs; this simply means that if you sell one of the pairing they really are, buy the other currency in the pair. To compare the prices of currency is displayed, how many counter currency in the amount of 1 base currency.
Let me give you an example. One of the most popular European pairs Euro and the U.S. dollar. Offer for mating can dollar EUR: USD 1.3901, which means that 1 Euro is worth 1.3901 USA. In 1 currency pair. Currency the Euro is the base currency and 2. Currency (USD) will be against or in the exchange rate. We are going in more detail in the next article, but today we explain what the Forex trade and some of the benefits associated with it.
o Is a 24-hour market, open 6 days a week. There is no need to wait to open trading this morning, while you lose money.
o It is the largest market and can absorb large transactions.
o This is not a bear market, as it is in the stock market. Because they trade 2 currencies simultaneously, to buy means selling another currency, so regardless of which direction the currency market is going. Again use the EUR: USD pairing for an example. If the Euro falls in value, the dollar will rise, and when the Euro rising, the dollar is in the price.
o High debt burden. Due to the high liquidity of the broker up to 200 typically offer:1 leverage. Some go up to 400:1. This means that with a leverage of 100:1 standard Lot of $ 100,000 can be traded with the margin 1% of 1000,00€. There are mini accounts that allow you to control $50 US $ 10,000.
o range of motion than predictable. Currency trading charts have been studied for over 100 years, and although they are fleeting cycles seem to repeat themselves, creating trends that are obligations when using technical analysis easier and earlier than other markets.
o Commission free trading. Brokers will advertise that you do not pay Commission, but do charge spreads, i.e. the difference between purchase price and sale price. In other words, the difference between what you buy and the price that you can get if you sell.
about Forex trading you get instantaneous execution of orders all orders are executed in electronic form and as trade via Internet platforms most orders are from.
Foreign exchange market Forex trading became available to small traders. You don’t need to start at $100,000 for trading, but you need a plan, a strategy and reliable system. Good luck in your trading.