What Is Forex Made Easy?
Forex (also known as Foreign Exchange or 4X) is an international exchange market in which currencies are sold and bought, bought and sold, 24 hours a day six days a week. The Forex market that we now know began in the early 1970s, when exchange rates and floating currencies were introduced.
Forex is unique because there are no external controls. With that comes the good and the bad. On the one hand, our societies all seem to be overregulated. On the other hand, the government regulators and private watchdog groups don't think we have enough regulation.
However, many government and private sector regulators want a lot more regulation in the Forex markets. They feel that an unregulated market is irresponsible and dangerous because accounts and people can be wiped out in minutes by greedy market manipulators. With no accountability or oversight, bad things will happen (and who can argue about that?). As it stands, regulation will not come quickly. Like any market this large, there are perhaps millions of large and small players involved, and change is excruciatingly slow in the offing.
The Forex market is also a market that cannot be easily manipulated. However, there are times the "big players" can and do manipulate the market and it's wise to find out when those times are (think holidays or whenever regular Joes like you and me have more time and energy to invest). More on that later.
Forex is also the largest liquid financial market in the world, with trade reaching between $1 and 1.5 trillion US dollars (USD) daily, every day. Think about that figure. Because it is such a highly liquid and fast-paced market, it is clear that one investor could not significantly affect the price of a major currency.
Market liquidity simply means that investors and traders can open and close their trades within mere seconds because there are always willing buyers, sellers, and brokers (who will take a very small cut for each trade).
There are four major currency pairs in 4X: Euro-US Dollar (EUR/USD), US Dollar-Japanese Yen (USD/JPY), US Dollar and Swiss franc (USD/CHF), British Pound and US Dollar (GBP/USD). The first currency in the pair refers to the "base" currency. The second half of the pair is called the counter currency. The EUR/USD is the most traded pair on the exchange and is extremely liquid.
The main currency pairs are typically traded in 100,000 base units. So, if you were buying EUR/USD at 1.09 you would be paying US Dollars (USD) for Euros as follows: 1.09 X 100,000 units = $109,000 US Dollars for 100,000 Euros. Don't worry, though, you won't need to come up with $109,000 USD to learn this skill. Instead you'll only need a small percentage of that amount, and it's called trading on margin or margin trading. This will be an entirely different lesson. Forex Made Easy is here to assist and we will be answering those questions as they arrive. - 23208
Forex is unique because there are no external controls. With that comes the good and the bad. On the one hand, our societies all seem to be overregulated. On the other hand, the government regulators and private watchdog groups don't think we have enough regulation.
However, many government and private sector regulators want a lot more regulation in the Forex markets. They feel that an unregulated market is irresponsible and dangerous because accounts and people can be wiped out in minutes by greedy market manipulators. With no accountability or oversight, bad things will happen (and who can argue about that?). As it stands, regulation will not come quickly. Like any market this large, there are perhaps millions of large and small players involved, and change is excruciatingly slow in the offing.
The Forex market is also a market that cannot be easily manipulated. However, there are times the "big players" can and do manipulate the market and it's wise to find out when those times are (think holidays or whenever regular Joes like you and me have more time and energy to invest). More on that later.
Forex is also the largest liquid financial market in the world, with trade reaching between $1 and 1.5 trillion US dollars (USD) daily, every day. Think about that figure. Because it is such a highly liquid and fast-paced market, it is clear that one investor could not significantly affect the price of a major currency.
Market liquidity simply means that investors and traders can open and close their trades within mere seconds because there are always willing buyers, sellers, and brokers (who will take a very small cut for each trade).
There are four major currency pairs in 4X: Euro-US Dollar (EUR/USD), US Dollar-Japanese Yen (USD/JPY), US Dollar and Swiss franc (USD/CHF), British Pound and US Dollar (GBP/USD). The first currency in the pair refers to the "base" currency. The second half of the pair is called the counter currency. The EUR/USD is the most traded pair on the exchange and is extremely liquid.
The main currency pairs are typically traded in 100,000 base units. So, if you were buying EUR/USD at 1.09 you would be paying US Dollars (USD) for Euros as follows: 1.09 X 100,000 units = $109,000 US Dollars for 100,000 Euros. Don't worry, though, you won't need to come up with $109,000 USD to learn this skill. Instead you'll only need a small percentage of that amount, and it's called trading on margin or margin trading. This will be an entirely different lesson. Forex Made Easy is here to assist and we will be answering those questions as they arrive. - 23208
About the Author:
Chan Boldene is a technical writer who enjoys writing about many subjects including Forex Made Easy, He also enjoys directing others to his dear friend's Daily Devotions at Devotions ChopChopsite.
posted by X - Men @ 1:14 AM
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