What is Forex

Forex or FX is initially an abbreviation for Foreign Exchange and means nothing other than the currency market. Unlike the classic stock trading is a Forex OTC market. This means there is no central exchange. The forex market allows investors to actively trade the currencies of different countries, where private investors may actively trade in the Forex market only since 1999. The forex market has a daily trading volume of more than five trillion dollars. This is far more than any other market.

The Forex market is five days a week, 24 hours open and open in Sydney with the Asian session and closes on Friday in New York with the U.S. session. In this way every trader can trade forex in any timezone, Whether it is day or night. The 24-hour trading has several advantages for traders. The dealer can take global opportunities immediately and this on almost any time, day or night. Especially since there are automated trading strategies. The Forex market is ideal for short term traders because of high volatility, because the impact of a variety of factors on exchange rates. Profits but also losses are realized immediately. In addition, the cost of forex trading compared to more traditional instruments are very low. Last but not least is one of the main attractions of the access to leverages whereby traders can increase even with the smallest market movements and with only a small investment your profit (or loss).

Currency pairs

The actual behavior of the Forex market are currency pairs. In essence, the currency trading works so that we can compete in a one currency with another. If a trader is of the opinion's analysis, for example, that the U.S. dollar will rise against the euro, he goes in the EUR / USD long. He is in USD long, which means that the trader is about shows that will win the U.S. currency against the euro.