Forex Basics

I think it would be an injustice if I did not include a Forex basics article in this web site so here goes...

The Forex market, a highly volatile and liquid market was established in 1971, it was created when floating exchange rates began to materialize.

The Forex market is not centralized, like in currency futures or stock markets. Trading occurs over the Internet, telephones and at thousands of locations worldwide.

Forex is a common term and short for the Foreign Exchange market, it is where banks, investors and speculators exchange one currency to another.

The largest foreign exchange activity retains the spot exchange (i.e.., immediate) between five major currencies: US Dollar, British Pound, Japanese Yen, Eurodollar and the Swiss Franc. It is also the largest financial market in the world.

An advantage of the Forex market in comparison to the stock market and other exchange-traded instruments is that Forex is a true 24-hour market. Whether its 6pm or 6am - somewhere in the world there are always buyers and sellers actively trading Forex. (Video...)

Trading begins once the markets are officially open in Tokyo, Japan at 7:00 PM Sunday, New York time.
Afterwards, at 9:00 PM EST, Singapore and Hong Kong opens followed by the European markets in Frankfurt at 2:00 AM and in London at 3:00 AM.
When the clock reaches 4:00 AM, the European markets are in the hot spot and Asia just concluded its trading day.
Around 8:00 AM on Monday, the US markets opens in New York while Europe is slowly going down. Australia will take the lead around 5:00 PM and when it is 7:00PM again, Tokyo is ready to reopen.

Currency pairs that are most actively traded are, in order:

The first currency is the base, therefore in a pair you can refer the amount of that currency as being the amount required to purchase one unit of the second currency.

So, if you want to buy the currency pair, you have to buy for example the GBP and sell the USD simulta­neously. On the other hand, if you are looking forward to sell the currency pair, you have to sell the GBP and buy the USD.

It is important to remember that well over 80 % of currency trading is speculative in nature and as a result, the market frequently surges and then corrects itself.

I think that’s enough of Forex basics, lets get to the interesting bit how do I trade Forex to make consistent money applying a simple but powerful technique… are you ready? Let’s go for it… “Forex Signal System” click here!

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