Forex Market Trading
The Foreign Exchange Market, also known as the Forex or FX Market, is the oldest, largest, and most liquid in the world. It’s where most of the world’s most common currencies are traded 24 hours a day. Knowing how to do Forex market trading can be extremely rewarding.
This market is far larger than the stock market or the futures currency market. Actually, the futures currency market is only 1% as large as the Forex market. This is great for short term traders as liquidity is extremely important to make fast, short term trades.
So what happens day in and day out on this market? Currency pairs are traded back and forth. The currencies from one country are exchanged for a currency from another country. Example of pairs are EUR/USD, GBP/USD, USD/JPY.
Most of the trading occurs with a handful of currencies from six countries. More than 80% of the volume traded on the Forex market is with the US Dollar, British Pound, Canadian Dollar, Japanese Yen, Australian Dollar, and the Swiss Franc.
This market is 100% virtual. There are no physical trading pits like the stock markets and future markets. All traders big and small access this market through their internet connections. The market also stays open 24 hours a day. This is perfect for us who want to treat trading like a business and be able to trade anywhere in the world that you can get internet access.
Not that long ago, it would have been next to impossible for you and I to enter this market. Only large corporations, governments, and banks were able to access the FX market to trade. The amount of money required to buy and sell currency pairs was massive.
Luckily for us, large broker firms entered this trading market. This allow them to divide up their accounts into smaller ones so everyday people could trade. Now, you can literally start to trade with only $250. You and I can access the once closely guarded and secretive world of Forex market trading.
