Forex Information

Welcome to OnlineForexTrading.co.uk your mini guide to online Forex trading, where you’ll be able to find out key information about Forex, Forex trading, Forex tips and many more.

Forex Currency Exchange

Forex, Fx, Spot Fx or Currency market are all names that refer to the foreign exchange market- a market where currencies are bought and sold according to an exchange rate. The market came about in the 1970s when President Nixon scrapped the Gold Standard. This allowed for currencies to fluctuate, and hence, created the potential for making profit off of trading currencies. Forex is the largest financial market in the world, averaging $4 trillion in daily trading volume, which is about 16 times the average trading volume of the New York Stock Exchange.

Forex Trading

Since the beginning of this market until the 1990s, the main currency traders were big banks and large financial institutions. This was due to the minimum monetary requirement to enter the market, which ranged from $10 million up to $50 million. What made it really open to the average person was the advent of the Internet, which made trading in smaller volumes with no minimum criteria possible. This has allowed for Forex trading systems to diversify, permitting more Forex brokers to exist and encouraging Forex trading software applications to be developed in order to streamline currency trading for average online users.

Here are a few Forex tips about currency trading:

Exchange rates

Unlike stock markets, there is no need for a lot of inside information in order to foresee market trends. Exchange rates are built on confidence in a certain currency, which ultimately stems from good macroeconomic indicators, providing a specific country is performing well from an economic point of view. One can have free access to this kind of information by reading economic-focused publications, guides, country pages and so on.

The key is that currencies are exchanged in pairs. You can sell USD to buy British pounds and so on. The exchange rate establishes the value of one currency relative to another. This means when one evaluates possible market trends, those need to be specifically related to the trading pair. For example, if the value of the American dollar declined as compared to the British pound, is it necessarily the case that it will decline as compared to all other currencies? The answer is most likely not.

The basic idea behind this is that economic indicators of each country’s performance will influence the confidence in its currency, stimulate or reduce demand, and therefore cause a change in its value. Inflation fears, debt defaults or recession fears are negative factors that will lower a currency’s value. Natural disasters, wars or deep recessions may be other factors that can lower a currency’s value across the board (i.e., relative to all other important currencies). Again, these simple economic factors are open to the public and this makes currency trading easier for average people.

Online Forex Trading

Online Forex trading involves online currency trading on an interbank rate via market makers. A market maker is a firm that quotes a buy and a sell price for a currency. Their profit comes from the currency spread, which is the difference between their buy price (the price they bought the currency for) and the sell price (the price they sell the currency to average traders for). The quotes for buying and selling are based on the market makers foreseen demand for one currency versus another one. In Forex most deals are over-the-counter. meaning a market maker sells to and buys from its clients. A market maker will allow you to set up online trading accounts.

You can get started by looking up market makers that offer a Forex demo trading session or a so-called “Forex for dummies” initiation process. You can choose between micro accounts and mini accounts according to the trading size you can afford. The benefit of Forex online trading is that it makes it possible to trade 24/7 in all sessions: the American, European and Asian trading sessions.

When trying to get started with online Forex trading, make sure you understand how the market works, and choose a market maker that will also provide you with resources for learning and getting used to currency trading.

Foreign Exchange, Trade Of Currencies

By forex futures trading

Excecutive Sumarry about Foreign Exchange, Trade Of Currencies By Chris David

forex trading currency

Foreign exchange is market where exchange of currencies takes place for another currency. Foreign exchange is the market where exchange of currencies takes place for more and different number of foreign county. Foreign exchange is nothing but buying and selling of foreign currencies in exchange of another. In the foreign exchange market, more of number of foreign currencies will be exchanged by the members and other traders with fluctuations of market price.

The rate of exchange fixed for the foreign currency varies as per the demand and fluctuation of foreign exchange market. Foreign currencies will be exchanged based on the requirement and demand for other foreign currency. The entry of any foreign currency is free and any number of counties can enter the foreign exchange market by buying and selling foreign exchange currencies. Sometimes, the foreign exchange market may finds fluctuations for the foreign currencies listed with respect to political and economic condition of the foreign currency in the market.

Finding Investment Opportunities in Currency Exchange

Excecutive Sumarry about Finding Investment Opportunities in Currency Exchange By Y. Tilden

Having an understanding of global market behavior will save investors from losing valuable investments and improve their odds for profit. Interest in the currency exchange market is growing, and investors with knowledge of global market behavior have an added advantage, as the money exchange is highly influenced by the global market activity. The currency exchange market differs from the NYSE in several ways. This difference in market opening time is one of the reasons why trading volume is so much larger on the currency market. Unlike the NYSE where transactions are centralized, the currency market is completely decentralized. Many factors make the currency market a highly lucrative investment market over the NYSE.

Forex Market size and liquidity

The foreign exchange market is unique because of the following characteristics:

• the high trading volumes
• the extreme liquidity of the market
• large number of traders in the market
• large variety of traders
• geographical dispersion
• long trading hours: 24 hours a day (except on weekends)
• the many factors that affect exchange rates
• the low margins of profit

In order to understand the functioning of the forex or the foreign exchange trading markets, it is primarily necessary to comprehend what is meant by the term ‘relative value’. It can be substantiated as follows. Every country in the world has its own distinct currency and it is possible to compare the value of the currency of one country to that of the currency of another country by determining a secular value which is popularly referred to as the relative value. It is always necessary to keep in mind that the relative value will never be a regular value but rather it will continue to change across regular time intervals influenced by the alterations in the value of the currency in the financial markets.

Forex has often been referred to as the market closest to the perfect competition. According to the BIS, average daily turnover in traditional foreign exchange markets is estimated at $3.21 trillion. Daily averages in April for different years, in billions of US dollars, are presented on the chart below:

This $3.21 trillion in global foreign exchange market "traditional" turnover was broken down as follows:

• $1,005 billion in spot transactions
• $362 billion in outright forwards
• $1,714 billion in forex swaps
• $129 billion estimated gaps in reporting

In addition to "traditional" turnover, $2.1 trillion was traded in derivatives.

Exchange-traded forex futures contracts were introduced in 1972 at the Chicago Mercantile Exchange and are actively traded relative to most other futures contracts. Forex futures volume has grown rapidly in recent years, and accounts for about 7% of the total foreign exchange market volume, according to The Wall Street Journal Europe (5/5/06, p. 20).

Average daily global turnover in traditional foreign exchange market transactions totaled $2.7 trillion in April 2006 according to IFSL estimates based on semi-annual London, New York, Tokyo and Singapore Foreign Exchange Committee data. Overall turnover, including non-traditional foreign exchange derivatives and products traded on exchanges, averaged around $2.9 trillion a day.

This was more than ten times the size of the combined daily turnover on all the world’s equity markets. Foreign exchange trading increased by 38% between April 2005 and April 2006 and has more than doubled since 2001. This is largely due to the growing importance of foreign exchange as an asset class and an increase in fund management assets, particularly of hedge funds and pension funds. The diverse selection of execution venues such as internet trading platforms has also made it easier for retail traders to trade in the foreign exchange market.

Because foreign exchange is an OTC market where brokers/dealers negotiate directly with one another, there is no central exchange or clearing house. The biggest geographic trading centre is the UK, primarily London, which according to IFSL estimates has increased its share of global turnover in traditional transactions from 31.3% in April 2004 to 32.4% in April 2006. RPP

The ten most active traders account for almost 73% of trading volume, according to The Wall Street Journal Europe, (2/9/06 p. 20). These large international banks continually provide the market with both bid (buy) and ask (sell) prices. 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 market-maker will buy ("bid") from a wholesale customer. This spread is minimal for actively traded pairs of currencies, usually 0–3 pips. For example, the bid/ask quote of EUR/USD might be 1.2200/1.2203 on a retail broker. Minimum trading size for most deals is usually 100,000 units of currency, which is a standard "lot".

These spreads might not apply to retail customers at banks, which will routinely mark up the difference to say 1.2100 / 1.2300 for transfers, or say 1.2000 / 1.2400 for banknotes or travelers' checks. Spot prices at market makers vary, but on EUR/USD are usually no more than 3 pips wide (i.e. 0.0003). Competition is greatly increased with larger transactions, and pip spreads shrink on the major pairs to as little as 1 to 2 pips.

Forex Trading characteristics

There is no unified or centrally cleared market for the majority of FX trades, and there is very little cross-border regulation. Due to the over-the-counter (OTC) nature of currency markets, there are rather a number of interconnected marketplaces, where different currency instruments are traded. This implies that there is not a single dollar rate but rather a number of different rates (prices), depending on what bank or market maker is trading. In practice the rates are often very close, otherwise they could be exploited by arbitrageurs instantaneously. A joint venture of the Chicago Mercantile Exchange and Reuters, called FxMarketSpace opened in 2007 and aspires to the role of a central market clearing mechanism.

The main trading centers are in London, New York, Tokyo, Hong Kong and Singapore, but banks throughout the world participate. 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.

There is little or no 'inside information' in the foreign exchange markets. Exchange rate fluctuations are usually caused by actual monetary flows as well as by expectations of changes in monetary flows caused by changes in GDP growth, inflation, interest rates, budget and trade deficits or surpluses, large cross-border M&A deals and other macroeconomic conditions. Major news is released publicly, often on scheduled dates, so many people have access to the same news at the same time. However, the large banks have an important advantage; they can see their customers' order flow.

Currencies are traded against one another. Each pair of currencies thus constitutes an individual product and is traditionally noted XXX/YYY, where YYY is the ISO 4217 international three-letter code of the currency into which the price of one unit of XXX is expressed (called base currency). For instance, EUR/USD is the price of the euro expressed in US dollars, as in 1 euro = 1.3045 dollar. Out of convention, the first currency in the pair, the base currency, was the stronger currency at the creation of the pair. The second currency, counter currency, was the weaker currency at the creation of the pair.

The factors affecting XXX will affect both XXX/YYY and XXX/ZZZ. This causes positive currency correlation between XXX/YYY and XXX/ZZZ.

On the spot market, according to the BIS study, the most heavily traded products were:

• EUR/USD: 28 %
• USD/JPY: 18 %
• GBP/USD (also called sterling or cable): 14 %

and the US currency was involved in 88.7% of transactions, followed by the euro (37.2%), the yen (20.3%), and the sterling (16.9%) (see table). Note that volume percentages should add up to 200%: 100% for all the sellers and 100% for all the buyers.

Although trading in the euro has grown considerably since the currency's creation in January 1999, the foreign exchange market is thus far still largely dollar-centered. For instance, trading the euro versus a non-European currency ZZZ will usually involve two trades: EUR/USD and USD/ZZZ. The exception to this is EUR/JPY, which is an established traded currency pair in the interbank spot market.

With the advancement of the various communication techniques over the years, the internet has emerged as a great medium which can play a vital role in facilitating different kinds of financial activities and it is interesting to note that forex ahs immensely benefited from it. There are today a huge number of investors who are engaged in online forex trading and there is a huge demand because of the greater chance of reaping profitable benefits through this form of currency trading.

It is also believed by most financial experts that currency trading via forex is a better option compared to investing in stock markets. This is because the initial costs of starting trading is quite low and since the financial markets are characterized by volcanic ups and downs, in case of forex trading it is possible to reap richer dividends despite a falling market.

Moreover, forex is also preferable because here the exchange rates are not dictated by a single centralized authority and the trading volume is also quite high. Significantly forex trading is not restricted within pre-determined boundaries and is therefore accessible widely. With the progress of time it is believed that the foreign exchange trading market or forex will emerge as a lead player in the financial market and will continue to reap higher profit levels in times to come.

SigmaForex The Forex Market and Understanding Foreign Exchange Rates

Friday, 10 October 2008

SigmaForex The Forex Market and Understanding Foreign Exchange Rates

Unlike the stock exchange, the Forex Market (foreign exchange market) is a relatively new player to the investment world. Today's current Forex market model started in the early 1970's, and today it represents the biggest financial market around, even surpassing the stock market. With trading surpassing $2 trillion dollars per day, the Forex market attracts more and more investors all the time. Before an investor starts trading on the Forex market, he should grasp the fundamentals of how exchange rates work.

Exchange rates

Basically, the exchange rate represents the rate of exchange between two currencies. Most currencies are traded, or paired up against the dollar. The five most common currencies traded on the market are the dollar (USD), euro (EUR), the yen (JPY), the British pound (GBP), and the Swiss franc (CHF). Some other currencies that are traded are the Australian dollar, the Canadian dollar, and the Hong Kong dollar.

In the exchange rate or ratio, the numerator represents the quote currency and the denominator the base currency, which always equals one.

Let's say that an investor wants to exchange euros for dollars. In this case, the euro currency is the quote currency, or how much currency you have to exchange. The base currency is the dollar. The investor researches the current exchange rate (euros converted into dollars) either on the Internet, through the bank, broker, etc., and then multiplies that amount by the number of euros to exchange. Let's say that the exchange rate is 1.57959. That means that 1.57959 euros must be paid to receive one dollar. If he has 1000 euros to exchange, then he can receive $1,579.59 (1000 x 1.57959).

On the flip side, the exchange rate can also tell the investor how much he'll receive if he converts dollars back into euros. If he has $1000, he can either divide that amount by the same euro to dollar exchange rate ($1000/1.57959 = 633.07 euros), or look up the conversation rate for dollars to euros on the Internet, etc. (i.e. .633072) and multiply it by the amount of dollars to exchange ($1000 x .633072 = 633.07 euros).

Once the exchange rate concept is understood, the investor can feel more confident in investing in the Forex market.

Sigma Services

As a professional online trading service Sigma strives to give an eminent beyond comparison of professional and individualized trading services, Sigma also provides several facilities for all kinds of traders.

Sigma helps private and institutional clients achieve their trading goals by offering an inclusive forex trading package, along with the state-of-art trading platform, real-time news and wireless access. We relegate to meeting and exceeding our customers' expectations with the utmost professionalism and integrity.

Sigma provides appropriate services satisfying the needs of all business partners’ specified requirements. A client's profit is our success and a client's loss is a significant call of action for us, we consider every client as a special case and a partner.

Sigma's Customer Support is our business core, as we provide 24/7 customer support. We keep in touch with all our clients to make sure that we are on the right pass.

Beginners Guide to Forex

What is Foreign Exchange?
The Foreign Exchange market, also referred to as the "Forex" or "FX" market, is the largest financial market in the world, with a daily average turnover of approximately US$1.5 trillion. Foreign Exchange is the simultaneous buying of one currency and selling of another. The world's currencies are on a floating exchange rate and are always traded in pairs, for example Euro/Dollar or Dollar/Yen.

Where is the central location of the FX Market?
FX Trading is not centralized on an exchange, as with the stock and futures markets. The FX market is considered an Over the Counter (OTC) or 'Interbank' market, due to the fact that transactions are conducted between two counterparts over the telephone or via an electronic network.

Who are the participants in the FX Market?
The Forex market is called an 'Interbank' market due to the fact that historically it has been dominated by banks, including central banks, commercial banks, and investment banks. However, the percentage of other market participants is rapidly growing, and now includes large multinational corporations, global money managers, registered dealers, international money brokers, futures and options traders, and private speculators.

When is the FX market open for trading?
A true 24-hour market, Forex trading begins each day in Sydney, and moves around the globe as the business day begins in each financial center, first to Tokyo, then London, and New York. Unlike any other financial market, investors can respond to currency fluctuations caused by economic, social and political events at the time they occur - day or night.

What kind of trading strategy should I use?
Currency traders make decisions using both technical factors and economic fundamentals. Technical traders use charts, trend lines, support and resistance levels, and numerous patterns and mathematical analyses to identify trading opportunities, whereas fundamentalists predict price movements by interpreting a wide variety of economic information, including news, government-issued indicators and reports, and even rumor. The most dramatic price movements however, occur when unexpected events happen. The event can range from a Central Bank raising domestic interest rates to the outcome of a political election or even an act of war. Nonetheless, more often it is the expectation of an event that drives the market rather than the event itself.

Information on Forex Markets Worldwide

Forex is a dealing technique also known by the nickname of FX or foreign market exchange. Those individuals and business organizations dealing in the foreign markets are commonly the largest, most wealthy businesses and financial establishments from all across the globe. They deal in multiple currencies from a great many nations to produce that balance between those who will profit and others who might in all probability suffer fantastic losses. Forex dealing is similar to that of most countries, but on a much larger, grander scale. It involves individuals, money and exchanges back and forth across the world in roughly any nation.

Different currency rates happen and change every day so the amount of the dollar today could be higher or lower the next. The trading on the forex market is one that you have to keep a watchful eye on your money, particularly if you’ve got a lot riding on it, you could be risking all of it. The main trading areas for forex, happens in Tokyo, London, and New York and in many other hub points around the world.

The heaviest amounts of money traded include the Swiss franc, the Australian dollar, the British pound, the United States dollar, the Eurozone euro and the Japanese yen. You can trade any one currency against another and you can trade from that currency to another currency to build up additional money and interest daily.

The times when forex exchange will open at a certain time and then close shop as a different market enters the fray. This is seen also in the stock exchanges from around the world, as some time zones are actioning transactions while making other transactions during various times. The results of any forex trading in one country could have results and differences in what happens in additional forex markets as nations run on alternate time zones. Exchange rates are going to vary from one forex trade to another, and brokers and day traders alike will want to know the rate changes for each new day before committing money.

The stock market is generally based on products, prices, and other factors within businesses that could alter the cost of shares. If someone knows what is going to happen before the general public, it is called insider trading, the use of illegal business intelligence to purchase or sell stocks on that information — which is punishable by law. There is very little, this kind of illegal activity the forex exchange. The monetary trades, buys and sells are all a part of the forex market but very little is based on business secrets, but much more dependent on the status of the currency, economy of any given country.

A three letter code is attached to every currency on the forex exchange so no confusion exists when knowing which currency one is trading from or into. The euro is the EUR and the United States dollar is listed as the USD. The British pound is the GBP and JPY stands for the Japanese yen. If forex trading seems interesting to you and you want to get in touch with a forex brokerage you can find many online where you can review the company, information and transactions before putting your money into the forex stock exchange.

What is FOREX? PRO-FOREX.COM

FOREX (FOReign EXchange market) is an international foreign exchange market, where money is sold and bought freely. In its present condition FOREX was launched in the 1970s, when free exchange rates were introduced, and only the participants of the market determine the price of one currency against the other proceeding from supply and demand. m aketiva As far as the freedom from any external control and free competition are concerned, FOREX is a perfect market. It is also the biggest liquid financial market. According to various assessments, money masses in the market constitute from 1 to 1.5 trillion US dollars a day. (It is impossible to determine an absolutely exact number because trading is not centralized on an exchange.) Transactions are conducted all over the world via telecommunications 24 hours a day from 00:00 GMT on Monday to 10:00 pm GMT on Friday.

Practically in every time zone (that is, in Frankfurt-on-Main, London, New York, Tokyo, Hong Kong, etc.) there are dealers who will quote currencies.

FOREX is a more objective market, because if some of its participants would like to change prices, for some manipulative purpose, they would have to operate with tens of billions dollars. That is why any influence by a single participants in the market is practically out of the question. The superior liquidity allows the traders to open and/or close positions within a few seconds. The time of keeping a position is arbitrary and has no limits: from several seconds to many years. It depends only on your trading strategies. Although the daily fluctuations of currencies are rather insignificant, you may use the credit lines, that are accessible even to currency speculators with small capitals ($ 1,000 - 5,000), where the profit may be impressive. read more..

At Forex, Foreign exchange quotes are a relation between currencies.maketiva

USDCHF - the cost of $1 in Swiss Francs.
USDJPY - the cost of $1 in Japanese yens.
EURUSD - the cost of Euro 1 in US dollars.
GBPUSD - the cost of 1 GBP in US dollars.

Welcome to the Forex Dealers informational resource

Forex dealers help assist individuals in buying and/or selling currency. The Forex market is worldwide and available 24 hours a day. It is similar to a currency exchange except one can make a lot of money if they buy or sell the right currency at the right time. To get started trading, all you need is some cash (at least $200.00) and access to a computer with the internet. If you just want to experience what Forex trading is all about before investing your money, you are allowed to do that also. You can try out the market by setting up a practice account which does not include real money.

If you still need help deciding on buying the software or just want a better understanding of how to use it the CMS Forex website has many resources to help you. The Vt Trader 2.0 Quick Video Guide gives a general explanation of what VT Trader is all about. The VT Trader Webinars is a course offered online to help get you acquainted with the features VT Trader 2.0 has to offer. The Chart pattern recognition tutorial is a tutorial showing how to interpret and analyze chart patterns. The VT Trader 2.0 manual is similar to most other. It has basic info about features, functions, trouble shooting, etc. There is a VT forum available to post, read or respond to discussions about the VT Trader 2.0. Finally, 24 hour customer service help is available to you via telephone, e-mail or live chat.

If you choose not to use CMS Forex dealers, here are a few tips to help you find the best Forex dealers available. First, ask around to family and friends about recommendations for dealers. Go to state and national associations and get a list of Forex dealers. Next, check out online forums and message boards and then research your results to ensure accuracy. Finally, make sure you have information about their ethics and experience investing.

Provided you decide to start trading it would be a great idea to invest in some software to help you keep up with your investments. The CMS Forex website recommends the VT Trader 2.0 Some of it’s key features are chart based trading, customizable interface, 100+ technical indicators, custom indicators, risk management tools, pattern recognition technology, customer alerts, Forex autopilot, stability and Dow Jones News. They also suggest the VT Trader Mobile device which can be taken wherever you go so you can trade anywhere.

The best Forex dealers understand supply and demand effects the market and make investments based off predicting future changes in currency exchange rates. The laws of supply and demand are: when supply is plentiful the price of that item should be low and when a product is limited in amount it causes the price to go up high. The National currency rates are directly associated with supply and demand. Also, as central banks adjust their interest rates, the Forex market may experience an incline or decline. Forex dealers work hard at predicting the central banks actions to increase the chance of incline.

One of the best Forex dealers online is CMS Forex (www.cmsfx.com) they have abundance of information to get anyone who wants to trade or just learn about trading started. If you are new to Forex they offer an online tutorial giving an option of detailed and/or overview information about trading. If you want to practice trading, there is software available to help aid in your decision. Finally if you are ready to trade and have at least $200.00 you can set up an account with a Forex dealer and start immediately.

There can be risk behind trading on the Forex market. Traders are given 2 options. One is the conservative approach and the other is the risk taking approach. Conservative trading consist of less trades spread out over a larger time span, strict risk taking strategies ( such as stop orders which will stop or open an account when its price reach the designated level) and average profits. The risk taking approach is the opposite. They trade more over a longer time span, take risk (allow money to remain open and invest till the end) and work toward top profits.

Technical analysis such as charts is also helpful to dealers. Some of the most popular charts are the moving average, moving average envelope, MACD, Volume, on balance volume, accumulation/distribution, chaikin money flow, Bollinger bands, relative strength index and stochasties. These charts collectively show trends, price changes, how much money is coming and going, etc. Forex dealers find this helpful cause it puts the information on easy to read at a glance charts.

Once you have a Forex dealer you can begin trading. A transaction is completed when you buy and sell a currency simultaneously. Usually the logic behind trading currency is to buy at low prices and sell at higher prices, which is called long position. The best Forex dealers pay close attention to the market and global financial information to help predict when to sell currency because the value will drop and then buy it back at a lower cost later. This is called the short position.

Forex dealers need to be aware of some key elements before deciding on what to trade or sell. They may use fundamental or technical analysis to help make wise choices. Fundamental analysis is the process of studying economic news about how a country is doing financially and shows their strengths and weaknesses. The different reports should have information about employment status, the countries Gross Domestic Product, world wide trading, sales, manufacturing and interest rates. According to how stable, how much growth or declination a country is experiencing will have a direct affect on their currency, which is pertinent for trades.

Unpredictable events such as natural disasters, war or terrorism has a great impact on the market because it causes instability. Central banks are important too because they are the one’s who set the base interest rates. The best Forex dealers are aware and keep track of countries financial health to help them make better investments.

Forex dealers only dealt with banks and large financial institutions in the past. The Forex market is now open to financial mangers and Forex traders. Although the Forex market is open 24 hours a day, the top Forex dealers operate at the time zones that correspond with Sydney, Tokyo, London and New York. People who are considering trading should do so when the top dealers are available in the above time zones. Whether you choose to trade during peek times or not, Forex is available for trading day or night, unlike the stock market.

What is Forex?

What is Forex?

The Foreign Exchange market is the largest financial market in the world, with over $1.5 trillion changing hands every day. That is larger than all US equity and treasury markets combined! Unlike other financial markets that operate at a centralized location (i.e., the stock exchange), the worldwide Forex market does not have a central location. It is a global electronic network of banks, financial institutions and individual Forex traders, all involved in the buying and selling of national currencies. Another major feature of the Forex market is that it operates 24 hours a day, corresponding to the opening and closing of financial centers in countries all across the world, starting each day in Sydney, then Tokyo, London, and New York . At any time, in any location, there are buyers and sellers, making the Forex market the most liquid market in the world.



Whether or not you are aware of it, you already play a role in currency trading. The simple fact that you have money in your pocket makes you an investor in currency. By holding US Dollars, for example, you have elected not to hold the currencies of other nations. Your purchases of stocks, bonds, or other investments – along with money deposited in your bank account – represent investments that rely heavily on the integrity of the value of the US Dollar. Due to the changing value of this denominated currency and the resulting fluctuations in exchange rates, your investments may change in value, affecting your overall financial status. With this in mind, it should be no surprise that many investors have taken advantage of the fluctuation in exchange rates, using the volatility of the foreign exchange market as a way to speculate on currency pairs.




Traditionally, access to the Forex market has been made available only to banks and other large financial institutions. With advances in technology over the years, however, the Forex market is now available to everybody, from banks to money managers to individual Forex traders.
pportunities in a rising or falling market Dissimilar from trading in the equity market, forex does not have any restrictions on short selling. No matter which way the market is moving or whether a trader is short or long, profit potential (and risk) exists in the forex market. Because currency trading involves the buying and selling of currency pairs, traders have an equal potential to profit (or lose) in a falling or rising market.
Unparalleled liquidity In the forex market, over $1.5 trillion worth of trades are traded daily, which makes the currency trading market the most liquid market in the world – trading in 1 day what Wall St. trades in 1 month. No matter what time of the day or night it is, the forex market is always moving, and around the world active traders are buying and selling currencies.
200 times more leverage than trading stocks With stocks, the maximum leverage is 2:1. But when you trade Forex with Forex, you can use up to 400:1 leverage. For example, if you invest $1,000 in stocks, with 2:1 leverage you may buy up to $2,000 worth of shares. However, if you invest $1,000 margin on a foreign currency trade, at 400:1 leverage, you can control up to $400,000 in currencies. Leverage is one of the most appealing factors of the forex market. Traders should note that trading using leverage may increase potential gains as well as losses on any given trade.



Scratch-out the middleman Spot currency trading bypasses expensive middlemen that are always associated with trading stocks. With forex, clients are able to interact directly with the currency market, and can buy and sell at the simple click of a mouse. No mess. No hassle. No middleman.



Commission-free* you are never charged a commission. No clearing fees. No exchange fees. No Software fees. No brokerage fees.
we are compensated through the Bid and Ask prices or spread of a given currency pair. We may charge a fee for fund withdrawals.
Forex and the technical trader Because currencies typically develop strong trending patterns, a technical currency trader may potentially identify new trends, breakouts, and opportunities to enter and exit positions.



Measuring the currency market Currency prices are reflected in the balance of supply and demand for currencies. When it comes to currencies, there are two primary factors that affect supply and demand and they are interest rates and the strength of the originating country’s economy as a whole. Fundamental indicators, such as foreign investment, PPI, CPI, GDP, and the trade balance, echo the overall health of the economy, and alter the supply and demand for that currency. Expert commentaries and data on interest rates, International trade, and currencies are release on a regular basis.




Trade forex 24-hours a day When you are looking at your forex platform, you are actually looking at a window display of the world’s economy. Currency trading is available twenty-four hours a day, starting on Sunday at 5P.M. EST with the opening of the market in Sidney and Singapore. A short while after, the Tokyo market opens. Then London, which opens at 2A.M. EST on Monday. And, by daytime in N.Y., the currency market has already been very active for fifteen hours. With currency trading, you are able to decide when to trade. Trading stocks when the U.S. markets are closed is difficult and only offers limited liquidity. With forex, you can trade twenty-four hours a day, from Sunday at 5P.M. EST. until Friday at 5P.M EST.
6 major currency pairs vs. over 8000 stocks There are approximately 8,000 publicly traded companies, deciding which one to trade can become downright tedious and confusing. How do you determine which needle to pull out of the haystack? With Forex, there are currently 6 major currency pairs to choose from, and about 34 second-tier currencies.

A good way to get big money is open for 24 hours a day and that is forex market. It provides a very great opportunity to all traders where they can trade day or even night. At the beginning, it does not give some important but to know also when is the right time to trade is important, because the one of the most crucial points to be successful in trading at the forex market is trading.

It is good to know where could be the best time to trade, and that is when the market is the most active and ahs the biggest volume of trades. The only one who makes profit is the currency that is more active and that moves to create a good chance to catch the trade. And if you catch a slow market, that’s a big waste of time.

Forex trading market offers its investors with exclusive and lucrative investing opportunities. But a 24 hours open market got high leverage, commission-free trading and easy accessibility. And this will help forex to become as one of the most popular invested financial market.

Forex exchange market has played an important role to every people. It does help businesses convert one currency to another. Its also has a good purpose and that is to help international trade and investments.

Trading Forex

Trading Forex

Using fundamental and technical analyses, the individual trader attempts to determine trends in the price movements of currencies, and by buying or selling currency pairs, attempts to gain profits. The most often traded currencies, the major currencies, are those of countries with stable governments and respected central banks that target low inflation. Currencies that often trade along with the U.S. Dollar include the European Euro, the Japanese Yen, the British Pound, and the Swiss Franc as they are the most liquid. "Exotic" currencies, on the other hand, are often tightly regulated and simply too illiquid.




Traders can generate profits (or losses) whether a currency is rising or falling by buying one currency, which is anticipated to gain value against another currency or selling one currency, which is anticipated to lose value against another currency. Taking a long position is one in which a trader buys a currency at one price and aims to sell it later at a higher price. Alternatively, a short position is one in which the trader sells a currency that he anticipates to depreciate and aims to buy the currency back later at a lower price. Buying or selling currencies in response to economic or political events which occur are reactive, whereas buying or selling currencies on anticipated events is speculative. The bulk of currency activity is generated by market participants anticipating the direction of currency prices. In general, the value of a currency versus other currencies is a reflection of the condition of that country’s economy with respect to the other major economies.
Diagram illustrating how a position is opened and closed generating a profit. Position is closed based on speculated downward market movement. Forex trading involves a substantial risk of loss.
Foreign exchange is a continuous global market, providing participants with 24-hour market access. The only breaks in trading occur during a brief period over the weekend. Although foreign exchange is the most liquid of all markets, the fact that it is an international market and trading 24-hours a day, the time of day can have a direct impact on the liquidity available for trading a particular currency. The major dealer centers and time zones are that of Sydney, Tokyo, London, and New York. Therefore, traders must consider which players are in the market, since in the modern interconnected financial world, events that occur at any hour, in any part of the globe, can affect some or all parts of the investment community. In addition, although trading in the "spot" market, the difference in time zones accounts for a two-day settlement period. The 24-hour nature of the foreign exchange market is a substantial attraction to many of its participants.
A proficient trader employs both technical and fundamental analyses prior to entering any trades. Fundamentals include watching the world news, and particularly studying variables that may cause the market price of a currency to fluctuate, including monetary and fiscal policy, political conditions, trade patterns, economic indicators (i.e. GDP, CPI, PPI), interest rates, inflation and unemployment numbers. Faith in a government’s ability to stand behind its currency also impacts currency price. From time to time, central banks use intervention as an effective method of enforcing market adherence to their desired exchange rate comfort zones. Technical analysis, which has grown dramatically in popularity in the foreign exchange market since the 1980s, involves computer charting, using trend lines, support and resistance levels, reversals, and numerous patterns and analyses to study the behavior patterns of market crowds to track and identify buying and selling opportunities. Over long historical periods, currencies have displayed identifiable trends and patterns which provide investors with potential trading opportunities.
It is the trader’s option to take either a conservative or a more risk-taking approach. Employing a conservative approach, the trader establishes and liquidates positions quickly and efficiently to capitalize on even the slightest of price fluctuations, using limit and stop orders to manage risk. A limit order is placed to ensure a position is established once a price level in the market has been reached.* A stop order is placed to automatically liquidate a position at a chosen price level in order to limit potential loss on a particular trade. By placing orders in relation to technical support and resistance levels, the trader may profit incrementally from the minor price fluctuations that occur each day.

How to learn forex : Technical Analysis :

How to learn forex : Technical Analysis :

The technical trader is concerned with studying patterns of price movement on the chart in order to predict the direction of current and future trends in the Forex market. The decision to buy, sell, or hedge a current position – or to stay out of the market entirely – is made upon this analysis. Identify recurring patterns and make educated assessments to guide your decisions; should you initiate a trade at the current price, or set your system to open a position at a future price? The goal of the technical analyst is simple: to make profitable Forex trades by identifying past patterns that have historically led to a predictable outcome.





However, the potential risk should always be considered. A recurring pattern is not precise and does not guarantee a desirable or expected price movement. Using various chart types and technical indicators, more accurate predictions can be made from better analysis of the Forex market. Technical indicators can be utilized to help you track specific, identified patterns. Once a pattern is recognized (not all are apparent), the Forex trader can decide whether to place a trade, or wait and monitor the price to see if the predictions were accurate. Additional drawing tools can be used to identify common trend qualities.

Forex Market

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Some Basic Facts

The forex market is the largest and most popular financial exchange in the world. The average volume traded on the forex market is 4 trillion dollars a day compared to 25 billion dollars a day on the New York Stock Exchange.

You may already be familiar with some of the main currencies that are traded on the forex exchange but here are just a few: The US Dollar, Euro, British Pound, Swiss Franc, and the Japanese Yen. The players in the forex market are central banks, large commercial banks, hedge funds, brokerage firms, and private individuals.

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Forex Market Hours

One of the main reasons why the forex market is so popular is because it is a 24 hour continuous market. Although the sessions on each of the separate exchanges generally open from 10AM to 6PM local time, they overlap each other like a relay race. Therefore, you can trade at any time and you can set your own hours. This is great for those who are not interested in a typical 9 to 5 job or for those who want to start trading on a part time basis.

Equal Opportunity Trading

The forex market is considered part of the Over The Counter, or OTC market, which means it doesn’t have a physical or central location. The forex market is run electronically within a network of banks and is made up of all participants that trade between themselves. The sheer size of the forex market makes it impossible for large investment or central banks to manipulate pricing for extended periods of time. This levels the playing field for all the average joe traders out there.

What it Means for You

Since there isn’t a centralized location and because there is little regulation of the forex market, there is heavy competition between different providers to attract the most traders and volume. It also means that the firm you trade with is your counterpart. The advantages are that you can trade directly with the market and that your transaction costs are kept down. The ability to make large profit off leverage is another advantage to the stock exchange. With some firms, you can trade or borrow up to 200 times the balance in your account. This means that a .5% move in the market can turn into a 100% gain.

The forex market is also popular because it doesn’t cost much to start trading. You have to be in it to win it, as some lotto slogans say. There are some online forex brokers that require as little as $10.00 to deposit in a trading account to get started. In the beginning, only large institutions could trade on the forex market; however the internet has made it possible for smaller investors to trade as well. Due to the popularity of online forex trading, the competition between online forex brokers is fierce. As a direct result, the minimum deposits to trade have now become very low.

The Foreign Exchange market, also referred to as the "FOREX" or "Forex" or "Retail forex" or “FX” or "Spot FX" or just "Spot" is the largest financial market in the world, with a volume of over $2 trillion a day. Compare that to the $25 billion a day volume that the New York Stock Exchange trades. Making money in such a market should be easy, right? Not necessarily. But it can be done. And with the advent of the internet, its now more easier than ever for the average person to get involved in speculative forex trading. In the past, forex trades had to be carried out through a broker and the initial requirement was that you could trade only if you had about ten to fifty million dollars to start with! Today, carrying out a trade can be done by anyone from the comfort of your home or in front of any pc with internet access using an online trading account.

The fact that there is so much risk and yet so much potential involved with forex trading is what draws most people to it, sort of like gambling. Its all about the adrenaline rush. And making money, of course.

There are many benefits and advantages to trading forex such as no commissions, no middlemen, no fixed lot size, low transaction costs, a 24 hour market, no one can corner the market, leverage, high liquidity, free “demo” accounts, news, charts, and analysis and “mini” and “micro” Trading

However, the speed and complexity of market movements can be a deterrent to aspiring investors. Unless you have a trading system you follow and a good grasp of the forex market, you can find yourself struggling.

So many new entrants into the forex market always tend to search for the ‘ultimate’ forex trading system. And there are so many such trading systems being flouted on the internet as the next best thing.

A good trading system will provide you ‘signals’ or ‘alerts’ about market movements as they arise based on popular Forex indicators like the Relative Strength Index and MACD lines. However, what you need is a complete trading system, one that gives you a trading strategy or ‘auto trade’ option, not just a signal service.

With time, it is important that you take the time to develop your own trading strategies. Take the time to sit down and thrash out your entry and exit tactics.

Before you start trading, it is imperative that you ask yourself these questions:

1. How much money are you willing to risk per trade?

2. How much margin are you comfortable with trading on?

3. Do you have a recovery strategy in the event your trades take you below margins.

4. How do you intend to manage the overall growth of your portfolio?

5. Will you take all your profits out or reinvest them to achieve your set targets?

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Dec2008

Forex Fundamental Analysis

There are two major methods of analysis used in forecasting the behavior of the Forex market; they are Technical analysis and Fundamental analysis.
They differ greatly but the trader can apply both to complement and supplement the study of the market for achieving superior results.
They also have the same goal i.e. to predict a price or movement of the market. The technical analysis studies the effect while the fundamental analysis studies the cause of market movement.

Fundamental Analysis has a very broad spectrum. One aspect looks at the general or qualitative factors; the other side considers tangible and measurable i.e. the quantitative factors.
Use Fundamental Analysis With Technical Analysis
In general the fundamental analysis method looks to forecast the future of price movements based on events that have not taken place yet. Important factors and statistical methods are used to predict how these events will affect supply and demand and the rates of the Forex.
We must remember that Fundamental analysis and Technical analysis are not the reliable factor on their own, but each needs to be used in conjunction with the other to form opinion about the changes in the Forex market.

Fundamental analysis is therefore the method of forecasting the future price movements based on economic, political, environmental and other relevant factors and statistics that are going to affect the basic supply and demand of the market.
A fundamental analysis involves in-depth study of the market. It focuses on what is going to happen in a market based on supply and demand, seasonal cycles, and weather and government policy.

In our global financial system all of the major world financial markets are interconnected, yet the most popular form of forex market analysis, technical analysis, concentrates only on one market at a time. Most traders that implement technical analysis-based trading strategies may use tools such as candlestick formations or moving averages, but they will only focus on one chart or one market at a time.

Technical analysis can still be very useful to a forex trader. After all, the vast majority of all daily forex trading volume is speculative in nature, and all of those masses of traders working at their computers are likely following the same handful of indicators and oscillators, as well as focusing on the same levels of support and resistance. If enough traders are following a 14-day Relative Strength Index indicator then making successful trades based on that indicator becomes self-fulfilling in nature.

In fact, it is possible for you to completely ignore all other financial markets and only focus on one currency pair's chart, and you could still have a profitable trading strategy. However, the stock and commodity markets (with oil and precious metals playing a large role) of a given country will inevitably affect the value of that country's currency, so it would be wise for any astute currency trader to stay aware of the goings-on of other related financial markets.

An interesting development that comes with the widespread proliferation of forex trading is that there is a relative lack of intermarket analysis compared to most stock or equity markets. If you have even a brief knowledge of stock-picking strategies, then you should be familiar with the concept of diversification (spreading your stock picks across different sectors) as well as using a general index of stocks to rank a specific sector's performance.

This is a good example of intermarket analysis, as these equities traders compare stocks across different sectors, small cap versus large cap stocks, and global stock prices versus domestic stock prices. Most commodities traders commonly practice intermarket analysis as well, by comparing related commodities such as silver versus platinum or soybeans versus corn.

There is not nearly as much intermarket analysis in currency trading on the surface as there may be for other markets, but geopolitical events and the prices of other markets all go into the factoring of exchange rates. A wise forex trader seeks to be as informed as possible, and this includes knowing of all other developments, whether it is interest rates or new stock market highs, that can affect a given currency's exchange rate.

A good way that you can begin to implement intermarket analysis into your forex trading is to stay abreast of the values of certain commodities that affect the value of currencies the most, namely oil and precious metals. There are many different precious metals markets, so if you do not want to spend all day doing your price checks then you can focus on just silver and gold (or even just gold alone if you are feeling lazy, since it is the quintessential precious metal).

Another good way a forex trader will use this type of analysis is to focus on the main stock index for a given country (such as the S&P 500 in the United States). If you watch Bloomberg or CNBC while you are doing your currency trading and you hear that a major stock index for a geographical region is hitting all-time highs, it would be a wise bet that the value of the currency involved will also increase.

Foreign exchange market

The purpose of the foreign exchange market is to help international trade and investment. A foreign exchange market helps businesses convert one currency to another. For example, it permits a U.S. business to import European goods and pay Euros, even though the business's income is in U.S. dollars.

In a typical foreign exchange transaction a party purchases a quantity of one currency by paying a quantity of another currency. The modern foreign exchange market started forming during the 1970s when countries gradually switched to floating exchange rates from the previous exchange rate regime, which remained fixed as per the Bretton Woods system.

Just as in the stock market, forex investors often use a strategy called hedging transactions to reduce a portion of the risk involved in trading. Many people think of hedging like buying an insurance policy for their money. It works in much the same way. Using investment instruments known as financial futures, forex traders can relax knowing that all losses are covered by the backup plan.

A type of financial instrument futures that many forex traders use to hedge a position is the futures contract, which is an agreement to exchange one currency for another at a specified price as at the last date of closure. Commodities futures currencies are bought and sold on the forex market just like any other instrument such as shares or currencies.

For example, say that you used to use the dollars to take a long position in EUR on the forex market, but you are worried that the price of the euro falls against the dollar. One thing you could do is take out a futures contract on dollars using euros. As the external factors affecting the prices of currencies, the price of futures contracts up and down as well, allowing your euros to dollars to offset your long position in euros. If the euro weakens, the price of futures contract rises, and vice versa. Thus, you have therefore eliminated the risk of your investment money.

Another form of hedging in the forex market is regularly practiced by companies that share internationally with many customers in Europe. A weak euro would cost some money in the long run because the original prices quoted in euros does not result in as many dollars. By taking a long position in dollars using euros, the company would just as much money on the forex they lost to fall on the value of the euro. Similarly, if it would lose money on the forex market due to a fall in value of the dollar, the company would offset the increased profits due to the higher value of the euro on the sale of its products.Hedging is a powerful tool that serves those who take the time to use them.

Today, It’s Not Only Forex That Is Suffering

It may take a while before consumers and businesses will be more confident on the economy again. Forex is in its worse shape. The value of your money in other countries will already be pennies, compared to what it was a long time ago. There are already a number of banks that are either closing or announcing their bankruptcy. On the other hand, there are several companies that are already shutting down, leaving thousands of workers without work, especially during the holidays.

Right now, the government is very busy coming up with rescue packages. For instance, China has already expressed their plans of launching a stimulus package in the form of reconstruction of areas damaged by earthquakes and rehabilitation of their old infrastructures. This will then boost the export of equipment, particularly those coming from California, Brazil, South Korea, Taiwan, and Japan, to name a few. The United States is currently opting for the approval of bailout plans and extending loans to companies in the hopes that they will be able to keep their businesses afloat and preserve as many jobs as possible.

Nevertheless, retail sales are in their ultimate down low. Just this October, the retail sales fell to 2.8 percent compared to the fall that happened in September, which was 1.3 percent. There are also a lot of employees who are now filing jobless claims in order to seek temporary support from the government.

What to Do in Times of Crisis

There are a lot of things that you can do so that you can better manage the crisis at hand. First of all, it’s very important that you can have total control of your spending. To make sure that you can do that, you can take note of the following tips:

1. Pay your debts. Make sure that the debt will become one of your monthly expenses and not just be an option that you have to pay up when you have extra cash. This is especially true when your interest rate is dependent on what is currently the rate in the market. If you don’t like to end up paying huge fees in the future, you’d better do this. This is also important to ensure that you don’t spend a huge chunk of your salaries in paying off penalties, which you could have controlled or prevented in the first place.

2. Save. Just like your debt, savings should be a monthly expense. This way, you will surely be forced to save some of your hard-earned cash for the rainy day. These days, when you aren’t really guaranteed that you will still have a job in the next months to come, your savings will be your contingency plan.

3. Start a business. Having a business seems to be a good idea these days, particularly when you settle for a home-based or online business. You can minimize your everyday expenses since you don’t need to set aside transportation and food expenses. You can also maximize your profits and have great control over them.

Many people are curious about getting into forex trading. It could be because of the financial increase that forex marketing brings. Anyone can have the opportunity to become rich. The possibilities are certainly endless. The forex market provides benefits that are countless. The list goes on.

If you are interested with the idea, it is best to get forex education especially in trading. This is like learning a new thing and can serve as an investment. However, you should be armed with the proper knowledge of getting into forex trading as this may be risky. This would assure that you are on the right track and you are on the way to increase your finances.

Being literate about forex trading allows you to understand its nature. By learning this, you will know how to earn money by trading currencies. You will even learn from some professional traders. Education about forex trading also allows you to know that the environment is ever changing especially the exchange rate. You will then be familiar about the changes and you can then make appropriate actions. You will also be aware of the risk control and management as this is the crucial part when getting inot forex trading. Education is indeed the start of a great endeavor.

Citigroup and the Government to Put Limit in Losses in the Forex Market

The rumors have been going on: Citigroup, one of the largest financial services companies in the world, is currently thinking of cutting back jobs, which means that there will be thousands of employees all over the world who will be losing their jobs before Christmas.

It is definitely such a huge threat, and for that, the government is thinking of helping the company to make sure that they can limit their losses in the forex market. Because the currency rates are falling, they have already garnered toxic assets. So far, the company has already garnered over $100 billion of it, after their shares have already lowered down and they eventually lost. This, in turn, definitely hurt the company, thereby forcing them to think of reducing the costs extensively.

As of the moment, the Treasury Department and the Federal Reserve are already in the talks with the Citigroup. There are also several U.S. regulators that have joined in the discussion. They have been in meeting during the entire weekend, and the results may be released this week, probably on Monday. Nevertheless, other pertinent details such as those who are really involved in the talks and issues that may have been reached are not known since they are left confidential. But to get an overview, the plan is to actually make sure that the assets of Citigroup will remain in the company and that the government will assume the losses, but only a portion of it.

Where It All Started

Citigroup suffered one of the greatest losses they ever have all throughout their lifetime: 60 percent of their market value. The sharp decline, which happened just last week, may be caused by the loss of investor confidence after the company continued to obtain losses rather than gains for four successive quarters. If the bank and the government will not do something about it and the value of the company will continue to slide down, there’s a huge possibility that this will be a major threat not only to their clients but to their employees as well. This will then pose a big problem in the operations of the bank.

The Benefit of the Plan

One of the foremost benefits of the rescue plan is to provide a good breathing room for the company. This will help calm down the nerves of investors, clients, and customers, most especially when they know that the company is getting support from the government. However, the plan may not be long-term, and the Citigroup should be more than prepared for the long days ahead. As mentioned, the government doesn’t absorb only a portion of the losses. Citigroup therefore must find ways on how to soften the impact of the remaining balance.

In the meantime, the company is doing its best to lift their image despite the financial turmoil. In a recent statement they released, they assured the public that they have excellent liquidity and very strong capital. The chief executive officer of the company, Vikram Pandit, already informed their employees that they will not be breaking the company and that there will be no brokerage unit that will be sold.