Forex Basics - What is Forex?

[Andy]

What is Forex?

The largest financial market in the world, Foreign Exchange market, Forex or FX market, all the terms are used to describe the business of trading of the world's various currencies, with more than $2 trillion changing hands every day. Being an international foreign exchange market, Forex is a market where money is sold and bought freely. FOREX was launched in the 1970s, to become the biggest liquid financial market today, dealing in more than hundred times the daily trading on the New York Stock Exchange.

FOREX is a perfect market to invest in, as it is free from any external control and free competition. Mostly, all Forex trading are tentative and unlike the stock market trading, the Forex market is not conducted by a central exchange, but on the “interbank” market, which is thought of as an OTC (over the counter) market. The trading takes place between the two dealers, either over the telephone or through Internet, all over the world. The major trading centers are the ones at Sydney, London, Frankfurt, Tokyo and New York, making Forex a 24-hour market.

Forex Trading requires the employing fundamental as well as technical analyses. These analysis help a trader to foresee and determine the development in the price trends of currencies, based on which, he attempts to predict market changes and make profits. Fundamental analysis can be said to use techniques to analyze the value of a state’s currency with the help of its economic indicators, quality markets and political events and associations. Political stability also influences the exchange rate at Forex. Its not just that Forex Trading is intutive, rather its technical

While Technical analysis engages the study of patterns of price trends and movements, making it easier for the trader to predict the path of the future developments in the Forex market. The primary data for a technical analysis are values, be it the highest or the lowest values, the price of opening and closing in a definite period of time, and the amount of transactions taking place. Any factor, be it economic, political or psychological, having little or some influence on the value or the price, has already been measured by the market to be included in the price. We offer some very useful Tips for New Forex Traders.

 

[sindarin]

nice post mod, it will be very helpful for beginner to have the basic thing about forex, so they will be interested to trading in forex too, and it seems that forex already earned more than that, because i see now many people seems interested with forex

 

[Cutiekc]

Our moderator already explained in details what forex trading means and its origin perhaps if i am being asked to define it in my own understanding i would say that it is an act of selling one currency to buy another which are being processed in pair that is for example usd/eur

 

[Sixteen]

Its really a nice article as am beginning to learn a little about forex. I tend to understand it is the process of buying and selling currencies inorder to make profit. Its really a cool way to begin and with a good trading analysis, we can predict the future of the forex market and thereby make profit with it.

 

[Andy]

Its really a nice article as am beginning to learn a little about forex. I tend to understand it is the process of buying and selling currencies inorder to make profit. Its really a cool way to begin and with a good trading analysis, we can predict the future of the forex market and thereby make profit with it.

Actually, there have no one could predict the future and it's the same in the Forex market. But, with the help if indicators, other tools and maybe luck also, we can have ideal how the market moving and make profit. It's not easy but not really hard work, let's learn from basic first.

 

[Sixteen]

Yeah you are right, learning from basic is really the best to do. Actually i think that all it requires is time and hardwork for one to really help himself in forex trading as it will help to gain more new ideas and strategy to trade vey well always and also minimize the risk of loosing much.

 

[ayushsrk]

Thanks a lot for the additional information in forex for us.This can help the members who donot know about forex to learn something about the huge market of trade and maybe even earn from that.The world now is involved in forex as it is a very profitable business and many are also earning from it.there are many traders and as it deals with exchange of currency there surely can be a huge profit as well as huge losses too.

 

[riddick09]

Thanks a lot for the additional information in forex for us.This can help the members who donot know about forex to learn something about the huge market of trade and maybe even earn from that.The world now is involved in forex as it is a very profitable business and many are also earning from it.there are many traders and as it deals with exchange of currency there surely can be a huge profit as well as huge losses too.

Basically, forex is being used worldwide since it stands for Foreign Exchange. So most of the countries do used different currencies and therefore we will have here different values of the currencies. There are not only traders who are in the market but overall it is the people around the world who make it change or move.

While forex trading is really difficult to learn and earn. And not all have capabilities to analyze and read the market which is seen in the forex chart. Forex traders do trading in a trading platform and also a client of different forex brokers.

 

[charlly007]

Yeah,nice post from the mod.I thought before that Fore trading is just buying and selling of dollars but reading more about the subject,i have learn that it is beyond that.It is the exchanging of one ecurrency to another.

 

[riddick09]

Yeah,nice post from the mod.I thought before that Fore trading is just buying and selling of dollars but reading more about the subject,i have learn that it is beyond that.It is the exchanging of one ecurrency to another.

Yes, it is. You are not only buy or sell of dollars in forex trading but you are trading with different currencies/pairs and even metals like gold. That is the most simple to do as a trader to do their activity of buying and selling. But then when we look at it and try to be a trader you will see that you will going to undergo many process or things in order to be a good trader.

I think, you misunderstand your post because currency is different from ecurrency wherein currencies are dollar, pound, yen, etc while ecurrency are known as payment processors such as Libertyreserve its different terms.

 

[Sixteen]

Well Forex is really a huge market that run 24 hours which really means that as some market closes other are begining to open for trade which makes it all day round. We can trade with differnet pairs and the most pairs which are been traded is the USD as many people do exchange their currency to dollars to purchase things. As we can see we need to buy and sell currencies, buying a currency shows we are predicting that the currency will bought will rise and when will sell it later on, we do make profit.

 

[Cutiekc]

Forex trading got much definations just as many as we could construct and post in a summarizing mind forex trading is a kinda business that involves exchanging currency or selling one currency to get the other in whicg are done in pairs.

 

[budado]

The simplest way to define forex is buy and sell of currencies. In short if you have money you exchange it to foreign currency and that's already forex trading. And of course in order for the exchanger site to earn they put spread. In spread that's who broker sites earn.

 

[charlly007]

The simplest way to define forex is buy and sell of currencies. In short if you have money you exchange it to foreign currency and that's already forex trading. And of course in order for the exchanger site to earn they put spread. In spread that's who broker sites earn.

I was a bit confused with the meaning of that word " Spread " but going through some article online,i was able to understand that,it is the way that brokers are making their money from their customers online.Well,Forex isn't that hard to define and understand.It had been shorten from Foreign Exchange to Forex.Even one year old baby will understand that.

 

[budado]

I was a bit confused with the meaning of that word " Spread " but going through some article online,i was able to understand that,it is the way that brokers are making their money from their customers online.Well,Forex isn't that hard to define and understand.It had been shorten from Foreign Exchange to Forex.Even one year old baby will understand that.

I don't know about one year old baby but I guess if one year old baby can understand forex trading then I guess your on that age bracket? Because in forex broker you need to be newbies first, then novice, beginners, intermediate and an expert.
For me newbies are those who have limited knowledge for forex, novice are one who know some strategy and start trading in demo account, beginners are the one starting in real account, intermediate are beginners who are starting to earn money via trading and of course experts.

 

[yudistirarizki]

i have software MT$ and how to use demo account..??and what's demo acccount must be invest $/dollar..??if must be invest how many to invest..?? thx..

 

[riddick09]

i have software MT$ and how to use demo account..??and what's demo acccount must be invest $/dollar..??if must be invest how many to invest..?? thx..

I don't understand well what you mean. But then it is right to start trading you need a forex broker that usually provide MT4 platform wherein you can here demo account which you will use for demo trading. In demo trading you can create as many as you want and you can also customize how much you are going to put as initial deposit. And there's no need for you invest in demo account.

 

[charlly007]

Yeah,it is true that you cannot trade Forex without going through brokers.There are many of them around today that you can choose from.You only have to choose the one that you think will benefit you the most.Brokers goes with Forex Trading.

 

[sindarin]

I was a bit confused with the meaning of that word " Spread " but going through some article online,i was able to understand that,it is the way that brokers are making their money from their customers online.Well,Forex isn't that hard to define and understand.It had been shorten from Foreign Exchange to Forex.Even one year old baby will understand that.

give me proof? if you cannot well it means you only talks about nothing, from what i see that is a good definition about forex, but everyone have their own opinion about what is forex and basically it is about buy and sell currency

 

[budado]

I just loss 2200 pips in the last three days. But I'm happy that my funds are still holding. Its really great that you know the basic principle of lots size and leverage. If you don't I already end up losing all my funds. I'm happy that right now I can survive for now even if will going to loss another 2000 pips. I have 14 open position in buy in eur/usd. from 1.3275 now its goes down to 1.2960. with 14 buy position.. grrrr... Now that's forex. lols.