What is Forex?
The word "Forex" means short foreign exchange market or the global stock of foreign money which fits to the word "FOReign EXchange market" in English. And be speculation by buying and selling currency pairs that possesses the basic share from operations in the forex market is the U.S. dollar (USD) (base currency) and Euro (EUR) and pound sterling (GBP) and Swiss franc (CHF) and Japanese Yen (JPY).
The word "Forex" means short foreign exchange market or the global stock of foreign money which fits to the word "FOReign EXchange market" in English. And be speculation by buying and selling currency pairs that possesses the basic share from operations in the forex market is the U.S. dollar (USD) (base currency) and Euro (EUR) and pound sterling (GBP) and Swiss franc (CHF) and Japanese Yen (JPY).
And are buying and selling of those currencies in U.S. dollars or other currencies among themselves, which defines pairs of currencies and against the U.S. dollar or any currency against another currency value. And are considered speculative currency trading in the stock market win, and also the most risky, because of rapid fluctuations in the currency of the upward trend to trend downward, or vice versa. In addition to the currency market there are other types of stock exchanges are: gold, silver, Petroleum Exchange, shares and bonds, agricultural crops and energy. The currency exchanges are characterized by various indicators and technical analysis, news analysis and rapid access to the profits.
The daily volume of currency trading in the forex market to reach $ 3 trillion. And to compare recall that the volume of activities of New York Stock Exchange does not exceed $ 300 billion a day, that is, it needs half a year to New York Stock Exchange to reach the size of the currency market.
And I have a bond market and sell the future (Future - FUTURE) and the lack of a fundamental difference compared to the currency market: they stop working at the end of the day and resume work with the next morning. And of course, if you are trading in the markets of Germany, for example, and the events occurred in America with a significant impact on the market, you may find the market at the beginning of his work is significantly different from what I expected.
The forex market is not a market in the literal sense of the word, as it has no center and no place has a certain exercise a trade. The trading exercised by calling telephone and Internet computer at a time, one of hundreds of banks around the world. Hundreds of jobs and sold dollars to buy every few seconds, and this is what is called currency trading.
Forex market combining four regional markets: Australian and Asian, and European and American. And continue operations where all trading days of work, and the market operates around the clock, or 24 hours a day. And notes the relative calm and from 20:00 to 01:00 GMT, and is attributed to close the New York Stock Exchange in the eighth evening and start work on the Tokyo Stock Exchange one morning.
The currency market is not about working hours because the stock traded between banks located in different parts of the world. And the price of currency changes, large multi-which helps to do some business operations in a single day. It is known that the declines significant impact on the financial markets, which could lead to the collapse of stocks or bonds. The forex market decline in U.S. dollar (for example) means that the price rise of other currencies and there is no such cite the collapse of stocks or bonds.
Established Forex market (FOREX) for the financial transactions between banks in 1971 when it turned transactions in world trade of using fixed values of the currencies to float values. The total output of the financial transactions carried out by agents of the financial markets to divert a certain amount of money in the currency of one country to another country's currency value agreed upon in advance for a specific date. And defines the specific currency conversion rate for another currency is simply: supply and demand for conversion approved by the parties.
The volume of transactions in the global capital market in steady growth. This development is significant in world trade and lifting the ban on currency in many countries. That 80% of all transactions is a speculation in the currency market aimed at obtaining profits from the differences in currency rates. And attract these speculations of many participants, both financial organizations or individual investors.
As a result of the tremendous development in communications technology in the last two decades has changed the market itself to a large degree. That the profession currency trader, which was surrounded by an aura of secrecy has become almost unanimous. The trade in currency, which was until recently limited to the big corporate banks is accessible to all as a result of electronic commerce. Even the largest banks in favor of trading as well as personal electronic transactions between two parties.
The aim of the Forex market as an area for the use of the possibilities of the person financial, mental and psychological blow is not luck. Some may succeed in this, but not for long. The basic advantage of the currency market is that the success of using the intellectual possibilities.
A significant feature of the currency market is characteristic balance although this seems strange. Everyone knows that the fundamental characteristic of the financial market is the sudden nosedive. But Forex market is different from the stock market in that it does not fall. When stocks lose value this collapse. But if the dollar collapsed, for example, that just means that other currency has become stronger - an example of the Japanese yen, which has become in a few months in 1998 the strongest quarter for almost the dollar. This has reached a decline of the dollar for some days in that period of tens of per cent. Although this did not happen the collapse of the market and transactions continued as usual. In this limited stability of the currency market and the associated work. The currency is fully liquidity goods can be bought or sold at all times.
Currency market works all the time-stop is not linked to working hours assigned to the Stock Exchange, the transactions between banks located in different parts of the globe. That changes in currency rates are significantly and several times be sufficient to carry out several operations each day. If you have a proven trading technology and secure area you can make work not compare the effectiveness of its effectiveness any other field. Therefore, we find the major banks acquire the most expensive equipment and used dozens of specialist trading in the various sections of the market.
The expenditure to engage in this work is not great. In fact, the work requirements in this area of study and primary acquisition and the purchase of a computer information service and does not exceed the value of insurance together a few thousand dollars and this amount can be invested seriously in any other field. With a huge supply of services in this area easy to find an experienced agent in the currency market. What is left after that depends on the stores. Conclude from this that the success in this area depends on you personally more than any other act.
The basic thing to success in this market is not the size of the money entering the market as it Hoturkaz at constant market study and understand Mikhanykyate and desires of the participants. This results in the continuous improvement of the way you work and organize your trading. This did not happen to successful people in the currency market depended on the capital only.
We have cut the global currency long way in a thousand years of human history, but the changes that occur in today's most interesting did not unthinkable one before. There are two basic alter define the new format of the global system of currencies:
The cash break now fully separated from any carrier material;
Technology has enabled communication and exchange of information to gather strong financial systems of different countries in the global financial system and a single.
Attractive features of the Forex market
Technology has enabled communication and exchange of information to gather strong financial systems of different countries in the global financial system and a single.
Attractive features of the Forex market
Liquidity: the market is based on a lot of money is limited managed to open and close any deal prices of specific currencies at the moment. I have a high degree of liquidity huge attraction for any investor as it gives him the freedom to open and close any deal, any size.
Hits: proportion of the work the market around the time it is not the traffickers in the market waiting to interact with a specific event, as the case may be in the stock market and other markets.
Flexible transactions: trading system is flexible in the market as it can make the deal for a limited time by former investor desire thing that can be planned in advance of his coming.
Cost: not for the forex market is traditionally no commission expenses, or any other expenses, except for expenses - or profits - the difference between the bid and the ask price (BID / ASK).
Standard price: the proportion of the high degree of liquidity in the market, we find that the vast majority of sales operations can be carried out at a flat rate, which avoids the problem of investor volatility, which is offset in the market for future sale or stock exchanges and other exchange markets where they are sold at a particular time and a specified price only the amount of limited currency.
Directional market: that the movement of the currency market any particular direction can be followed by a period of time. And give each a specific currency price change with time special only thing that gives the investor the possibility of dealing in the market with tact.
The size of the margin: in the Forex market determines the size of the margin loan, or shoulder-proclaimed only agreement between the client and that the bank Omketb brokerage which gives the director of the market and is usually 1:100 to pay any customer a deposit of $ 1000 can make a deal equal to 100 thousand dollars. Use of this margin with the large currency fluctuations make this profitable market, but also great risks.
Concepts are wrong:
Hits: proportion of the work the market around the time it is not the traffickers in the market waiting to interact with a specific event, as the case may be in the stock market and other markets.
Flexible transactions: trading system is flexible in the market as it can make the deal for a limited time by former investor desire thing that can be planned in advance of his coming.
Cost: not for the forex market is traditionally no commission expenses, or any other expenses, except for expenses - or profits - the difference between the bid and the ask price (BID / ASK).
Standard price: the proportion of the high degree of liquidity in the market, we find that the vast majority of sales operations can be carried out at a flat rate, which avoids the problem of investor volatility, which is offset in the market for future sale or stock exchanges and other exchange markets where they are sold at a particular time and a specified price only the amount of limited currency.
Directional market: that the movement of the currency market any particular direction can be followed by a period of time. And give each a specific currency price change with time special only thing that gives the investor the possibility of dealing in the market with tact.
The size of the margin: in the Forex market determines the size of the margin loan, or shoulder-proclaimed only agreement between the client and that the bank Omketb brokerage which gives the director of the market and is usually 1:100 to pay any customer a deposit of $ 1000 can make a deal equal to 100 thousand dollars. Use of this margin with the large currency fluctuations make this profitable market, but also great risks.
Concepts are wrong:
There are two concepts that lay on the FOREX market first is that work in this market resembles the play roulette - one wins a large amount of money and lose the rest. It is natural to be a big risk. But Forex is not a game Roulette, in the changing currency rates play certain laws. First adopt the value of a currency specific indicators of the economy of the country specified. Secondly, determined by the preferences and expectations of customers in the market. Despite the difficulty of the work expectations, but possible. Work on the Forex market is confirmed by analysis that the proportion of positives include more than coincidence.
Today we find that the risk and the risk is part and parcel of doing the work actively in market conditions, ie, can simply say that the real amount to the success of any project or deal can be different from what was expected when the decision-making. But speculation in the money market is the most risky and dangerous because it can be the loss ratio of the complexity and difficulty of predicting the behavior of the market can never guarantee a positive result. That this fact alienated many working in the capital market although it is accessible to everyone thanks to the electronic communications technology and the huge base for the analysis of information .
The second concept is that the profit of the wrong person must necessarily offset the loss of others. But speculation in the Forex market is not in many cases at the expense of changing currency rates, because there is a large group of participants using currencies of change for other purposes (import and export, investment and tourism) did not play the price fluctuations for short times an important role for them. With the freedom to change the basic world currencies free-floating rate determined by supply and demand become the process of changing the currency in itself a source of income, meaning that the currency is a commodity like any other goods.
The currency market is the fact that, like other exchange markets is never in equilibrium. The condition can be described as a state of constant search for balance slider.
What is required for success in the currency market? The basic vehicle access to that can be formed as follows:
Predict the correct direction of change of exchange rates;
Achieve a minimum of loss when the market situation is good;
Haphazard deal with the money used in trading.
The prediction of the correct price depends on the deep study of the market. Usually had three forms of market analysis: analysis of news and analysis and technical analysis myself. Shall be considered and the correct combination of these three analysis is the guarantee for the correct prediction in the currency market.
Achieve a minimum of loss when the market situation is good;
Haphazard deal with the money used in trading.
The prediction of the correct price depends on the deep study of the market. Usually had three forms of market analysis: analysis of news and analysis and technical analysis myself. Shall be considered and the correct combination of these three analysis is the guarantee for the correct prediction in the currency market.
News analysis includes the study of economic and political factors that may affect the currency market. For example, reports the reserve policies of the U.S. central bank, economy and basic transactions, and statements important and other important events. The main objective of the analysis is the basic analysis of the key factors and their impact on the dynamics of prices in the currency market. The shops in the Forex market always be familiar with the current situation globally.
Technical analysis is an analysis of the market situation changes based on the previous price. Used in this analysis Albeana graphics that reflect price changes for a certain period. We can also technical analysis to understand the general market situation at the present time, several indicators can predict price changes in the near future. Technical analysis is based on the fact that the movement of prices to take into account all the factors that could affect the market - economic, political, psychological and other factors - are already taken into account in determining prices. And if the market is really market Vsttkon his movement as a result of a huge number of participants taken after their analysis of the enormous amount of information when they contract deals. The behavior of prices is a result of these decisions, and you have to monitor each input information in this market. What is required is the fact that few stores - to know the direction of movement of prices. And technical analysis gives a tremendous amount of tools enable us to draw useful forecasts of graphs of prices.
Psychoanalysis is to analyze the behavior of traders in the market and their psychological and expectations, hopes and fears. This type of analysis is very important because the rate of health is very high. We must not forget that behind the computer stations that give the price expectations and humans depends on their actions in the end currency rates.
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