Whether you plan to trade on the foreign exchange marketplace (Foreign exchange) or in the stock marketplace you will need to have some knowledge on two basic forms of analysis: fundamental analysis and technical analysis. Traders will transfer their money out of the stock market when interest rates rise, which can cause the currency of that country to weaken. The foreign exchange market is a cash interbank/interdealer market.
Major news is released publicly, often on scheduled dates, so many people have access to the same news at the same time. In the broader sense, currency correlation can refer to the correlation between any currency pairs and the commodities, stocks and bonds markets. A country’s economic health is directly measured by economic reports. The foreign exchange (currency or foreign exchange or FX) market exists wherever one currency is traded for another.
Surpluses and deficits in trade of goods and services reflect the competitiveness of a nation's economy. The world's currency markets can be viewed as a huge melting pot: in a large-scale and ever-changing mix of current events, supply and demand factors are constantly shifting, and the price of one currency in contrast to another shifts accordingly. Interest rates and the strength of the economy are the two primary causes that determine the availability of a currency. Remember that economic indicators gauge a country’s economic state, changes in the conditions reported will directly affect the price and volume of a country’s currency.
Different dealers offer very different deals to their customers. A broker is any person or firm that charges a fee in exchange for executing trades for a trader. A Forex broker is paid according to the spread or the difference between the traders bid for a currency, and the sellers asking price for that currency. A Forex broker does not charge a commission for placing a buy or a sell order the way a real estate broker would charge a percentage fee of the total price of a sale.
When two markets are open at the same time, trading is busiest during those timeframes. The Forex market is open 24 hours a day; however it isn’t always active during those 24 hours. Currency trading happens continuously throughout the day; as the Asian trading session ends, the European session begins, followed by the North American session and then back to the Asian session, excluding weekends.
The loan (influence) in the margined account is collateralized by your initial margin (deposit), if the value of the trade (position) drops sufficiently, the broker will ask you to either put in more cash, or sell a portion of your position or even close your position. The bare minimum security (margin) for each lost will vary from broker to broker. A margined account is a leverageable account in which Forex can be purchased for a combination of cash or collateral depending what your brokers will accept.
A market order is an order to buy or sell at the current marketplace price.
When you are doing your research of the brokers, check to see what kind of trading tools and analysis data they are offering. The diverse selection of execution venues such as internet trading platforms has also made it easier for retail traders to trade in the forex market.
Generally, the more healthy and robust a country's economy, the better its currency will perform, and the more demand for it there will be. Reports released by the government that detail a country’s economic performance are economic indicators.
Wednesday, February 27, 2008
Monday, February 18, 2008
Basic Forex Orders
Following is a brief description of the types of basic orders that can be placed in the Forex market:
Market Order
A market order is an order to buy or sell at the current market price. For example, EUR/USD is currently trading at 1.2045. If you wanted to buy at this exact price, you would click buy and your trading platform would instantly execute a buy order at that exact price.
Limit Order
A limit order is an order placed to buy or sell at a certain price. The order essentially contains two variables, price and duration. For example, EUR/USD is currently trading at 1.2045. You want to go long if the price reaches 1.2065. You can either sit in front of your computer and wait for it to hit 1.2065 (at which point you would click a buy market order), or you can set a buy limit order at 1.2065 (then you can walk away from your computer). If the price goes up to 1.2065, your trading platform will automatically execute a buy order at that exact price.
Stop-Loss Order
A stop-loss order is a limit order linked to an open trade for the purpose of preventing additional losses if the price goes against you. A stop-loss order remains in effect until the position is liquidated or you cancel the stop-loss order. Stop-losses are extremely useful if you don’t want to sit in front of your computer all day worried that you will lose all your money.
Other Order Types
GTC (Good ‘til canceled)
A GTC order remains active in the Forex market until you decide to cancel it. Your broker will not cancel the order at any time. Therefore it is your responsibility to remember that you have the order scheduled.
GFD ( Good for the day)
A GFD order remains active in the Forex market until the end of the trading day. Because the foreign exchange is a 24-hour market, this usually means 5:00 p.m. EST since that is when the U.S. markets close, but you need to double check with your broker to determine the exact time of the end of the trading day.
OCO (Order cancels other)
An OCO order is a mixture of two limit and/or stop-loss orders. Two orders with price and duration variables are place above and below the current price. When one of the orders is executed the other order is canceled. Example: The price of EUR/USD is 1.2020. You want to either buy at 1.2075 or sell at 1.1965. If the OCO order reaches the 1.2075, you will buy and the 1.1965 sell order will be automatically canceled.
Market Order
A market order is an order to buy or sell at the current market price. For example, EUR/USD is currently trading at 1.2045. If you wanted to buy at this exact price, you would click buy and your trading platform would instantly execute a buy order at that exact price.
Limit Order
A limit order is an order placed to buy or sell at a certain price. The order essentially contains two variables, price and duration. For example, EUR/USD is currently trading at 1.2045. You want to go long if the price reaches 1.2065. You can either sit in front of your computer and wait for it to hit 1.2065 (at which point you would click a buy market order), or you can set a buy limit order at 1.2065 (then you can walk away from your computer). If the price goes up to 1.2065, your trading platform will automatically execute a buy order at that exact price.
Stop-Loss Order
A stop-loss order is a limit order linked to an open trade for the purpose of preventing additional losses if the price goes against you. A stop-loss order remains in effect until the position is liquidated or you cancel the stop-loss order. Stop-losses are extremely useful if you don’t want to sit in front of your computer all day worried that you will lose all your money.
Other Order Types
GTC (Good ‘til canceled)
A GTC order remains active in the Forex market until you decide to cancel it. Your broker will not cancel the order at any time. Therefore it is your responsibility to remember that you have the order scheduled.
GFD ( Good for the day)
A GFD order remains active in the Forex market until the end of the trading day. Because the foreign exchange is a 24-hour market, this usually means 5:00 p.m. EST since that is when the U.S. markets close, but you need to double check with your broker to determine the exact time of the end of the trading day.
OCO (Order cancels other)
An OCO order is a mixture of two limit and/or stop-loss orders. Two orders with price and duration variables are place above and below the current price. When one of the orders is executed the other order is canceled. Example: The price of EUR/USD is 1.2020. You want to either buy at 1.2075 or sell at 1.1965. If the OCO order reaches the 1.2075, you will buy and the 1.1965 sell order will be automatically canceled.
Sunday, February 17, 2008
Forex Trading - Brokers
Many individuals consider the Forex market risky. Currency trading is risky but not any riskier than other investment trading (such as the stock market). It’s not the fact that you are trading currencies but how you manage the risk of the currency trading market. If you would like to participate in the Forex market, learn how to manage the risks involved.
Forex has no central market place for traders and no standard in foreign currency exchanges. Different dealers offer very different deals to their customers. Therefore you need to carefully research the Forex dealers before you sign up with their company. Pick a reputable dealer that will give you a fair deal and avoid scams.
It is recommended that traders only deal with authorized currency traders. If you are trading in the United States, make sure your Forex brokerage firm is registered with Futures Commission Merchant (FCM) and regulated by the Commodity Futures Trading Commission (CFTC). Most large brokerage firms are in some way connected to a bank or financial institution.
Different Forex brokers will offer different trading tips and tools. When you are doing your research of the brokers, check to see what kind of trading tools and analysis data they are offering. A good Forex brokerage firm should offer real-time charts, technical analysis tools, real-time trade alerts and website support. Also make sure the broker offers a demo account that you can trade with prior to opening a live account.
Forex has no central market place for traders and no standard in foreign currency exchanges. Different dealers offer very different deals to their customers. Therefore you need to carefully research the Forex dealers before you sign up with their company. Pick a reputable dealer that will give you a fair deal and avoid scams.
It is recommended that traders only deal with authorized currency traders. If you are trading in the United States, make sure your Forex brokerage firm is registered with Futures Commission Merchant (FCM) and regulated by the Commodity Futures Trading Commission (CFTC). Most large brokerage firms are in some way connected to a bank or financial institution.
Different Forex brokers will offer different trading tips and tools. When you are doing your research of the brokers, check to see what kind of trading tools and analysis data they are offering. A good Forex brokerage firm should offer real-time charts, technical analysis tools, real-time trade alerts and website support. Also make sure the broker offers a demo account that you can trade with prior to opening a live account.
Tuesday, February 12, 2008
Foreign Exchange Market
Currency trading is risky but not any riskier than other investment trading (such as the stock market). Forex is the commonly used term for foreign exchange trading. Most large brokerage firms are in some way connected to a bank or financial institution. Interest rate news has a direct impact on the international financial markets.
When you are doing your research of the brokers, check to see what kind of trading tools and analysis data they are offering. The Forex is made available to traders through platforms. Forex futures volume has grown rapidly in recent years, and accounts for about 7% of the total forex marketplace volume, according to The Wall Street Journal Europe (5/5/06).
Surpluses and deficits in trade of goods and services reflect the competitiveness of a nation's economy. There will be a greater demand, thus a higher price, for currencies perceived as stronger over their fairly weaker counterparts. (Pips are the smallest movement a currency can make on the Forex.) Supply and demand for any given currency, and thus its value, are not influenced by any single element, but rather by a number of elements.
A Foreign exchange broker is paid according to the spread or the difference between the traders bid for a currency, and the sellers asking price for that currency. Different dealers offer very different deals to their customers. A Forex broker does not charge a commission for placing a buy or a sell order the way a real estate broker would charge a percentage fee of the total price of a sale. A broker is any person or firm that charges a fee in exchange for executing trades for a trader.
You can trade 24-hours a day in the biggest and most fluid market in the world. There is very little volume on weekends and holidays and you will probably end up losing money if you choose to trade on these days. Foreign exchange trading starts on Sunday at 5:00 p.m.
If you would like to participate in the Forex market, learn how to manage the risks involved. It is difficult to determine what type of an impact a rate change will have in the marketplace. Margin rules may be regulated in some countries, but margin requirements and interest vary among broker/dealers so always check with the broker you are dealing with and make sure you understand their policy. Leverage financed with credit, such as that purchased on a margin account is very common in Forex.
Fundamental analysis in the Foreign exchange is the economic conditions and the affect those conditions have on a nation’s currency. It is recommended that traders only deal with authorized currency traders. Foreign exchange trading between parties occurs through computer terminals, exchanges and over telephones at thousands of locations worldwide.
Reports released by the government that detail a country’s economic performance are economic indicators. Government budget deficits or surpluses: The market usually reacts negatively to widening government budget deficits, and positively to narrowing budget deficits. Technical analysis in the Foreign exchange is that price is assumed to reflect all news and the charts provided by the brokers are the objects of analysis. There is the potential for profit in the currencies market regardless of which way the market moves.
When you are doing your research of the brokers, check to see what kind of trading tools and analysis data they are offering. The Forex is made available to traders through platforms. Forex futures volume has grown rapidly in recent years, and accounts for about 7% of the total forex marketplace volume, according to The Wall Street Journal Europe (5/5/06).
Surpluses and deficits in trade of goods and services reflect the competitiveness of a nation's economy. There will be a greater demand, thus a higher price, for currencies perceived as stronger over their fairly weaker counterparts. (Pips are the smallest movement a currency can make on the Forex.) Supply and demand for any given currency, and thus its value, are not influenced by any single element, but rather by a number of elements.
A Foreign exchange broker is paid according to the spread or the difference between the traders bid for a currency, and the sellers asking price for that currency. Different dealers offer very different deals to their customers. A Forex broker does not charge a commission for placing a buy or a sell order the way a real estate broker would charge a percentage fee of the total price of a sale. A broker is any person or firm that charges a fee in exchange for executing trades for a trader.
You can trade 24-hours a day in the biggest and most fluid market in the world. There is very little volume on weekends and holidays and you will probably end up losing money if you choose to trade on these days. Foreign exchange trading starts on Sunday at 5:00 p.m.
If you would like to participate in the Forex market, learn how to manage the risks involved. It is difficult to determine what type of an impact a rate change will have in the marketplace. Margin rules may be regulated in some countries, but margin requirements and interest vary among broker/dealers so always check with the broker you are dealing with and make sure you understand their policy. Leverage financed with credit, such as that purchased on a margin account is very common in Forex.
Fundamental analysis in the Foreign exchange is the economic conditions and the affect those conditions have on a nation’s currency. It is recommended that traders only deal with authorized currency traders. Foreign exchange trading between parties occurs through computer terminals, exchanges and over telephones at thousands of locations worldwide.
Reports released by the government that detail a country’s economic performance are economic indicators. Government budget deficits or surpluses: The market usually reacts negatively to widening government budget deficits, and positively to narrowing budget deficits. Technical analysis in the Foreign exchange is that price is assumed to reflect all news and the charts provided by the brokers are the objects of analysis. There is the potential for profit in the currencies market regardless of which way the market moves.
Monday, February 11, 2008
Trading - Forex Market
It’s not the fact that you are trading currencies but how you manage the risk of the currency trading market. In the broader sense, currency correlation can refer to the correlation between any currency pairs and the commodities, stocks and bonds markets. Foreign exchange has no central marketplace place for traders and no standard in foreign currency exchanges. A Good For The Day (GFD) order remains active in the Foreign exchange market until the end of the trading day. There is no unified or centrally cleared market for the majority of FX trades, and there is very little cross-border regulation.
The Foreign exchange can be broken up into three major trading sessions: the Tokyo Session, the London Session, and the U.S. Session. Foreign exchange trading increased by 38% between April 2005 and April 2006 and has more than doubled since 2001. Some individuals consider the Forex marketplace risky. As a person who wants to invest in the foreign exchange market, one should understand the basics of how this currency marketplace operates.
Technical analysis in the Foreign exchange is that price is assumed to reflect all news and the charts provided by the brokers are the objects of analysis. Also, events in one country in a region may spur positive or negative interest in a neighboring country and, in the process, affect its currency. Reports can be used to predict the performance of and the immediate direction of a country’s economy. Due to the over-the-counter (OTC) nature of currency markets, there are rather a number of interconnected marketplaces, where different currency instruments are bought and sold.
A Forex broker is paid according to the spread or the difference between the traders bid for a currency, and the sellers asking price for that currency. Different dealers offer very different deals to their customers. A Foreign exchange broker does not charge a commission for placing a buy or a sell order the way a real estate broker would charge a percentage fee of the total price of a sale. A broker is any person or firm that charges a fee in exchange for executing trades for a trader.
If you’re looking for the best days of the week to trade try Tuesdays and Wednesdays because these are the busiest days for trading. The Forex market is open 24 hours a day; however it isn’t always active during those 24 hours. There is very little volume on the weekends and holidays and you will probably end up losing money if you choose to trade on these days.
The loan (leverage) in the margined account is collateralized by your initial margin (deposit), if the value of the trade (position) drops sufficiently, the broker will ask you to either put in more cash, or sell a portion of your position or even close your position. A margined account is a leverageable account in which Forex can be purchased for a combination of cash or collateral depending what your brokers will accept. The loan (leverage) in the margined account is collateralized by your initial margin (deposit), if the value of the trade (position) drops sufficiently, the broker will ask you to either put in more cash, or sell a portion of your position or even close your position.
A currency may sometimes strengthen when inflation rises because of expectations that the central bank will raise short-term interest rates to combat rising inflation. In other words, this means the currencies bought and sold in the foreign exchange marketplace are bought and sold directly between banks, foreign currency dealers and forex investors wishing either to diversify, speculate or to hedge foreign currency risk. Depending on your marketplace position, an investor always has the opportunity to profit in a fluctuating marketplace because Forex trading involves selling one currency to buy another. Generally, the more healthy and robust a country's economy, the better its currency will perform, and the more demand for it there will be.
Interest rate news has a direct impact on the international financial markets. When a country raises its interest rate, that country’s currency strengthens relative to other currencies. Once you have deposited your money you will than be able to trade.
You need to carefully research the Forex dealers before you sign up with their company. Pick a reputable dealer that will give you a fair deal and avoid scams. Depending on your marketplace position, an investor always has the opportunity to profit in a fluctuating market because Forex trading involves selling one currency to buy another. The forex market exists wherever one currency is traded for another.
The Foreign exchange can be broken up into three major trading sessions: the Tokyo Session, the London Session, and the U.S. Session. Foreign exchange trading increased by 38% between April 2005 and April 2006 and has more than doubled since 2001. Some individuals consider the Forex marketplace risky. As a person who wants to invest in the foreign exchange market, one should understand the basics of how this currency marketplace operates.
Technical analysis in the Foreign exchange is that price is assumed to reflect all news and the charts provided by the brokers are the objects of analysis. Also, events in one country in a region may spur positive or negative interest in a neighboring country and, in the process, affect its currency. Reports can be used to predict the performance of and the immediate direction of a country’s economy. Due to the over-the-counter (OTC) nature of currency markets, there are rather a number of interconnected marketplaces, where different currency instruments are bought and sold.
A Forex broker is paid according to the spread or the difference between the traders bid for a currency, and the sellers asking price for that currency. Different dealers offer very different deals to their customers. A Foreign exchange broker does not charge a commission for placing a buy or a sell order the way a real estate broker would charge a percentage fee of the total price of a sale. A broker is any person or firm that charges a fee in exchange for executing trades for a trader.
If you’re looking for the best days of the week to trade try Tuesdays and Wednesdays because these are the busiest days for trading. The Forex market is open 24 hours a day; however it isn’t always active during those 24 hours. There is very little volume on the weekends and holidays and you will probably end up losing money if you choose to trade on these days.
The loan (leverage) in the margined account is collateralized by your initial margin (deposit), if the value of the trade (position) drops sufficiently, the broker will ask you to either put in more cash, or sell a portion of your position or even close your position. A margined account is a leverageable account in which Forex can be purchased for a combination of cash or collateral depending what your brokers will accept. The loan (leverage) in the margined account is collateralized by your initial margin (deposit), if the value of the trade (position) drops sufficiently, the broker will ask you to either put in more cash, or sell a portion of your position or even close your position.
A currency may sometimes strengthen when inflation rises because of expectations that the central bank will raise short-term interest rates to combat rising inflation. In other words, this means the currencies bought and sold in the foreign exchange marketplace are bought and sold directly between banks, foreign currency dealers and forex investors wishing either to diversify, speculate or to hedge foreign currency risk. Depending on your marketplace position, an investor always has the opportunity to profit in a fluctuating marketplace because Forex trading involves selling one currency to buy another. Generally, the more healthy and robust a country's economy, the better its currency will perform, and the more demand for it there will be.
Interest rate news has a direct impact on the international financial markets. When a country raises its interest rate, that country’s currency strengthens relative to other currencies. Once you have deposited your money you will than be able to trade.
You need to carefully research the Forex dealers before you sign up with their company. Pick a reputable dealer that will give you a fair deal and avoid scams. Depending on your marketplace position, an investor always has the opportunity to profit in a fluctuating market because Forex trading involves selling one currency to buy another. The forex market exists wherever one currency is traded for another.
Friday, February 8, 2008
Trading Forex Basics
Just like in the stock market, better returns are provided by countrys that demonstrate faster growth and better economic conditions compared to other countries. Whether you plan to trade on the foreign exchange marketplace (Foreign exchange) or in the stock market you will need to have some knowledge on two basic forms of analysis: fundamental analysis and technical analysis.
Reports released by the government that detail a country’s economic performance are economic indicators. Generally, the more healthy and robust a country's economy, the better its currency will perform, and the more demand for it there will be. Fundamental analysis in the Forex is the economic conditions and the affect those conditions have on a nation’s currency.
The levels of access that make up the foreign exchange marketplace are determined by the size of the “line” (the amount of money with which they are trading). The Forex Marketplace better known as Foreign exchange - is a world wide market for buying and selling currencies. A country’s economic health is directly measured by economic reports. The Forex can be broken up into three major trading sessions: the Tokyo Session, the London Session, and the U.S. Session.
Different dealers offer very different deals to their customers. Traders of Forex commonly favor Forex online trading systems. Due to the over-the-counter (OTC) nature of currency markets, there are a number of interconnected marketplaces, where different currency instruments are traded. Interest rate news has a direct impact on the international financial markets.
A Forex broker is paid according to the spread or the difference between the traders bid for a currency, and the sellers asking price for that currency. A Forex broker does not charge a commission for placing a buy or a sell order the way a real estate broker would charge a percentage fee of the total price of a sale. Different dealers offer very different deals to their customers. A broker is any person or firm that charges a fee in exchange for executing trades for a trader.
The Forex marketplace is open 24 hours a day; however it isn’t always active during those 24 hours. There are two markets open worldwide at the same time. There is very little volume on weekends and holidays and you will probably end up losing money if you choose to trade on these days. The London session is usually busier than the Tokyo or U.S. session.
Closing your open positions will prevent your account from falling into a negative balance if the market is decreasing rapidly. If you would like to participate in the Foreign exchange marketplace, learn how to manage the risks involved. Control financed with credit, such as that purchased on a margin account is very common in Foreign exchange.
The retail sales report measures the total receipts of all retail stores in a given country. Trade flows are a factor in the long-term direction of a currency's exchange rate. Many individuals consider the Foreign exchange market risky. Foreign currencies traded in the foreign exchange market are traded directly between banks, foreign currency dealers and forex investors wishing either to diversify, speculate or to hedge foreign currency risk.
Currency trading is risky but not any riskier than other investment trading (such as the stock market). A market order is an order to buy or sell at the current marketplace price. An important part of this marketplace comes from the financial activities of companies seeking forex to pay for goods or services.
When a country raises its interest rate, that country’s currency strengthens relative to other currencies. The Forex can be broken up into three major trading sessions: the Tokyo Session, the London Session, and the U.S. Session. The bid/ask spread is the difference between the price at which a bank or market maker will sell ("ask", or "offer") and the price at which a marketplace-maker will buy ("bid") from a wholesale customer.
Reports released by the government that detail a country’s economic performance are economic indicators. Generally, the more healthy and robust a country's economy, the better its currency will perform, and the more demand for it there will be. Fundamental analysis in the Forex is the economic conditions and the affect those conditions have on a nation’s currency.
The levels of access that make up the foreign exchange marketplace are determined by the size of the “line” (the amount of money with which they are trading). The Forex Marketplace better known as Foreign exchange - is a world wide market for buying and selling currencies. A country’s economic health is directly measured by economic reports. The Forex can be broken up into three major trading sessions: the Tokyo Session, the London Session, and the U.S. Session.
Different dealers offer very different deals to their customers. Traders of Forex commonly favor Forex online trading systems. Due to the over-the-counter (OTC) nature of currency markets, there are a number of interconnected marketplaces, where different currency instruments are traded. Interest rate news has a direct impact on the international financial markets.
A Forex broker is paid according to the spread or the difference between the traders bid for a currency, and the sellers asking price for that currency. A Forex broker does not charge a commission for placing a buy or a sell order the way a real estate broker would charge a percentage fee of the total price of a sale. Different dealers offer very different deals to their customers. A broker is any person or firm that charges a fee in exchange for executing trades for a trader.
The Forex marketplace is open 24 hours a day; however it isn’t always active during those 24 hours. There are two markets open worldwide at the same time. There is very little volume on weekends and holidays and you will probably end up losing money if you choose to trade on these days. The London session is usually busier than the Tokyo or U.S. session.
Closing your open positions will prevent your account from falling into a negative balance if the market is decreasing rapidly. If you would like to participate in the Foreign exchange marketplace, learn how to manage the risks involved. Control financed with credit, such as that purchased on a margin account is very common in Foreign exchange.
The retail sales report measures the total receipts of all retail stores in a given country. Trade flows are a factor in the long-term direction of a currency's exchange rate. Many individuals consider the Foreign exchange market risky. Foreign currencies traded in the foreign exchange market are traded directly between banks, foreign currency dealers and forex investors wishing either to diversify, speculate or to hedge foreign currency risk.
Currency trading is risky but not any riskier than other investment trading (such as the stock market). A market order is an order to buy or sell at the current marketplace price. An important part of this marketplace comes from the financial activities of companies seeking forex to pay for goods or services.
When a country raises its interest rate, that country’s currency strengthens relative to other currencies. The Forex can be broken up into three major trading sessions: the Tokyo Session, the London Session, and the U.S. Session. The bid/ask spread is the difference between the price at which a bank or market maker will sell ("ask", or "offer") and the price at which a marketplace-maker will buy ("bid") from a wholesale customer.
Wednesday, February 6, 2008
Forex - Basics
Whether you plan to trade on the foreign exchange market (Forex) or in the stock market you will need to have some knowledge on two basic forms of analysis: fundamental analysis and technical analysis. It is the tendency for the price of a currency to reflect the impact of a specific action before it occurs and, when the anticipated event comes to pass, react in exactly the opposite direction. Certain reports will give an indication of whether a nation’s economy has improved or declined. Trade flows are an important cause in the long-term direction of a currency's exchange rate. The Foreign exchange can be broken up into three major trading sessions: the Tokyo session, the London session, and the US session.
Forex trading increased by 38% between April 2005 and April 2006 and has more than doubled since 2001. GFD ( Good for the day) currency trading is risky but not any riskier than other investment trading (such as the stock marketplace).
It’s not the fact that you are trading currencies but how you manage the risk of the currency trading marketplace. Reports can be used to see if a country is making or losing money on its products and services when it is compared to a nation’s exports. The duration of the trade can be a few days, months or years. Whether you plan to trade on the foreign exchange market (Forex) or in the stock market you will need to have some knowledge on two basic forms of analysis: fundamental analysis and technical analysis.
A Foreign exchange broker does not charge a commission for placing a buy or a sell order the way a real estate broker would charge a percentage fee of the total price of a sale. Different dealers offer very different deals to their customers. A broker is any person or firm that charges a fee in exchange for executing trades for a trader. A Forex broker is paid according to the spread or the difference between the traders bid for a currency, and the sellers asking price for that currency.
The Forex market is open 24 hours a day; however it isn’t always active during those 24 hours. Currency trading happens continuously throughout the day; as the Asian trading session ends, the European session begins, followed by the North American session and then back to the Asian session, excluding weekends. The London session is usually busier than the Tokyo or US sessions. There are usually two markets open at the same time.
A margined account is a leverageable account in which Foreign exchange can be purchased for a combination of cash or collateral depending what your brokers will accept. For instance, for every $1,000 you have, you can trade 1 lot of $100,000. Think of your broker as a bank who basically fronts you $100,000 to buy currencies and all he wants from you is $1,000 as a good faith deposit, which he will hold for you but not necessarily keep. This means that for every $100,000 traded, the broker requires $1,000 as a deposit on the position.
There is the potential for profit in the currencies marketplace regardless of which way the market moves. In simplest terms, this means the foreign currencies bought and sold in the forex marketplace are traded directly between banks, foreign currency dealers and forex investors wishing either to diversify, speculate or to hedge foreign currency risk. Interest rate news has a direct impact on the international financial markets. The levels of access that make up the foreign exchange market are determined by the size of the “line” (the amount of money with which they are trading).
Reports released by the government that detail a country’s economic performance are economic indicators. The retail sales report measures the total receipts of all retail stores in a given country. You are probably wondering how a small investor like yourself can trade such large-scale amounts of money. The foreign exchange market is not a "marketplace" in the traditional sense due to the fact that there is no centralized bank for fx trading activity and, therefore, trades placed in the forex market are considered over-the-counter (OTC).
When a country raises its interest rate, that country’s currency strengthens relative to other currencies. The average daily trade in the global forex and related markets currently is over US$ 3 trillion. A marketplace order is an order to buy or sell at the current marketplace price.
Forex trading increased by 38% between April 2005 and April 2006 and has more than doubled since 2001. GFD ( Good for the day) currency trading is risky but not any riskier than other investment trading (such as the stock marketplace).
It’s not the fact that you are trading currencies but how you manage the risk of the currency trading marketplace. Reports can be used to see if a country is making or losing money on its products and services when it is compared to a nation’s exports. The duration of the trade can be a few days, months or years. Whether you plan to trade on the foreign exchange market (Forex) or in the stock market you will need to have some knowledge on two basic forms of analysis: fundamental analysis and technical analysis.
A Foreign exchange broker does not charge a commission for placing a buy or a sell order the way a real estate broker would charge a percentage fee of the total price of a sale. Different dealers offer very different deals to their customers. A broker is any person or firm that charges a fee in exchange for executing trades for a trader. A Forex broker is paid according to the spread or the difference between the traders bid for a currency, and the sellers asking price for that currency.
The Forex market is open 24 hours a day; however it isn’t always active during those 24 hours. Currency trading happens continuously throughout the day; as the Asian trading session ends, the European session begins, followed by the North American session and then back to the Asian session, excluding weekends. The London session is usually busier than the Tokyo or US sessions. There are usually two markets open at the same time.
A margined account is a leverageable account in which Foreign exchange can be purchased for a combination of cash or collateral depending what your brokers will accept. For instance, for every $1,000 you have, you can trade 1 lot of $100,000. Think of your broker as a bank who basically fronts you $100,000 to buy currencies and all he wants from you is $1,000 as a good faith deposit, which he will hold for you but not necessarily keep. This means that for every $100,000 traded, the broker requires $1,000 as a deposit on the position.
There is the potential for profit in the currencies marketplace regardless of which way the market moves. In simplest terms, this means the foreign currencies bought and sold in the forex marketplace are traded directly between banks, foreign currency dealers and forex investors wishing either to diversify, speculate or to hedge foreign currency risk. Interest rate news has a direct impact on the international financial markets. The levels of access that make up the foreign exchange market are determined by the size of the “line” (the amount of money with which they are trading).
Reports released by the government that detail a country’s economic performance are economic indicators. The retail sales report measures the total receipts of all retail stores in a given country. You are probably wondering how a small investor like yourself can trade such large-scale amounts of money. The foreign exchange market is not a "marketplace" in the traditional sense due to the fact that there is no centralized bank for fx trading activity and, therefore, trades placed in the forex market are considered over-the-counter (OTC).
When a country raises its interest rate, that country’s currency strengthens relative to other currencies. The average daily trade in the global forex and related markets currently is over US$ 3 trillion. A marketplace order is an order to buy or sell at the current marketplace price.
Tuesday, February 5, 2008
Basic Forex Trading
Forex is the biggest and most fluid market in the world, trading approximately $2 trillion every day. The Foreign exchange marketplace is a cash interbank/interdealer marketplace. In simplest terms, this means the currencies traded in the Foreign exchange market are traded directly between banks, foreign currency dealers and Forex traders. Nevertheless, trade flows are an important cause in the long-term direction of a currency's exchange rate.
The Forex marketplace is not a traditional "market" due to the fact that there is no centralized bank for Forex trading activity and, therefore, trades placed in the Foreign exchange market are considered over-the-counter (OTC). Foreign exchange trading between parties occurs through computer terminals, exchanges and over telephones at thousands of banks worldwide. Clients can trade through online Foreign exchange trading platforms and/or over the telephone directly with a Foreign exchange broker on our trading desk. Due to the over-the-counter (OTC) nature of currency markets, there are rather a number of interconnected marketplaces, where different currency instruments are bought and sold.
Until recently the Foreign exchange market has not been available to the small trader. The large-scale bare minimum foreign currency transaction sizes and financial contributions left this marketplace open only to banks, major foreign currency dealers and the occasional large-scale Foreign exchange speculator. Now, with the option to control large positions with a relatively small amount of capital (margin), the Forex market is now more fluid than ever and available to most investors.
Five major currencies dominate trading in the Foreign exchange marketplaces: the U.S. Dollar, Euro, Japanese Yen, Swiss Franc and British Pound. The foreign currencies are traded in pairs in the Forex spot market. For instance, buying the EUR/USD in the Foreign exchange spot marketplace simply means the purchaser is buying the Euro and selling the U.S. Dollar in anticipation of the Euro gaining value in comparison to the U.S. Dollar. Likewise, the seller of a EUR/USD contract would be selling the Euro against the U.S. Dollar.
Over the past twenty years, an escalation in international trade and foreign investment has made the economies of the world more interconnected. New opportunities for traders have been created with the dramatic economic growth of the Asian and Latin American economies. Today, supply and demand for a specific currency is the driving factor in determining exchange rates. Other factors such as routinely reported economic figures and unpredicted news reports, such as disasters or political instabilities, could also alter the desirability of holding a particular currency, thus determing international supply and demand for that currency.
The Forex marketplace is not a traditional "market" due to the fact that there is no centralized bank for Forex trading activity and, therefore, trades placed in the Foreign exchange market are considered over-the-counter (OTC). Foreign exchange trading between parties occurs through computer terminals, exchanges and over telephones at thousands of banks worldwide. Clients can trade through online Foreign exchange trading platforms and/or over the telephone directly with a Foreign exchange broker on our trading desk. Due to the over-the-counter (OTC) nature of currency markets, there are rather a number of interconnected marketplaces, where different currency instruments are bought and sold.
Until recently the Foreign exchange market has not been available to the small trader. The large-scale bare minimum foreign currency transaction sizes and financial contributions left this marketplace open only to banks, major foreign currency dealers and the occasional large-scale Foreign exchange speculator. Now, with the option to control large positions with a relatively small amount of capital (margin), the Forex market is now more fluid than ever and available to most investors.
Five major currencies dominate trading in the Foreign exchange marketplaces: the U.S. Dollar, Euro, Japanese Yen, Swiss Franc and British Pound. The foreign currencies are traded in pairs in the Forex spot market. For instance, buying the EUR/USD in the Foreign exchange spot marketplace simply means the purchaser is buying the Euro and selling the U.S. Dollar in anticipation of the Euro gaining value in comparison to the U.S. Dollar. Likewise, the seller of a EUR/USD contract would be selling the Euro against the U.S. Dollar.
Over the past twenty years, an escalation in international trade and foreign investment has made the economies of the world more interconnected. New opportunities for traders have been created with the dramatic economic growth of the Asian and Latin American economies. Today, supply and demand for a specific currency is the driving factor in determining exchange rates. Other factors such as routinely reported economic figures and unpredicted news reports, such as disasters or political instabilities, could also alter the desirability of holding a particular currency, thus determing international supply and demand for that currency.
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