Forex dealer

WHAT I'M DOING WHEN I OPERATE FOREX?

Forex is an abbreviation commonly used for "foreign exchange" or "currency exchange" and is often used to describe the trading in Forex by investors and speculators.

For example, imagine a situation in which it is expected that the value of the U.S. dollar to weaken relative to the euro. A trader of forex in this situation is to sell dollars and buy euros. If the euro strengthens, the purchasing power to buy dollars has increased. The trader can now return to buy more dollars of what he had started, earning a profit.

This is similar to trading. A broker will buy an action if you think that the price will increase in the future and sell an action if it thinks that its price will fall in the future. Likewise, a forex trader will buy a currency pair if you expected the exchange rate to increase in the future and will sell a currency pair if you expect the exchange rate to fall in the future.

WHAT IS FOREIGN EXCHANGE?

The Forex market is a global market and decentralized that determines the relative values of different currencies. Unlike other markets, there is no centralized depository or Exchange where transactions are carried out. Instead, these operations are carried out by several participants of the market in several places. It is rare that two coins are of identical value one another and also it is rare for two currencies to maintain the same relative value for more than a short period of time. In Forex, exchange between two pairs of currency rate changes constantly.

For example, January 3, 2011, one euro was worth around $1.33. On 3 May 2011, one euro was worth around $1.48. The euro has appreciated by 10% against the U.S. dollar during this time.

WHY DO EXCHANGE RATES CHANGE?

Currencies are traded in an open market, such as shares, bonds, computers, cars and many other goods and services. The value of a currency fluctuates as its supply and its demand fluctuates, just like anything else.

An increase of the offer or a decrease in the demand for a currency may cause the value of the currency to fall.

A decrease in supply or an increase in the demand for a currency can cause to increase the value of that currency.

A great benefit of operate Forex is that you can buy or sell a currency pair at any time, subject to availability of liquidity. So if you believe that euro area is going to separate, you can sell euro and buy dollars (selling EUR / USD). If you think that the gold price will go up, based on the historical correlation patterns, you can buy Australian dollar and sell U.S. dollars (buy AUD / USD).

This also means that in reality there is the "bear market" in the traditional sense. You can win (or lose) money when the market is in upward or downward trend.

What do you need to Trade Forex?

Let's start with the basic needs to trade forex from home, something until not long ago available to few. Everything you need to start learning and, in the future, trade forex are 2 things to everyone:

A PC

Connection to internet

This is all!

An experienced trader can get important gains, not only each month, but also every day, on the other hand, if you do not learn and you train, significant gains will be transformed, almost certainly, in significant losses. Don't worry, train and learn in forex only cost you, in principle, your time. Virtually all brokers allow to open accounts show that you do not spend you a penny and have money to spend on your training with market data in real time.

The overwhelming success of this business every day suggests that more and more people lies in the advantages offered to traditional businesses:

Without bosses

Without customers

Without strict schedules

You can operate from home, your place of holiday and virtually any place, because not using a notebook pc, there are even brokers offering its platform of trading for pocket PCs and mobile phones.

Do I follow? The list of advantages is innumerable, in another chapter, we will focus on the advantages of Forex to other financial markets.

Get ready to start training, sit on your desktop (or in your home more comfortable armchair), connects the trading platform and passes to the next lesson!

In Forex one can operate an almost endless list of currency pairs, but in truth, there are a series of currencies that are those that use a greater number of participants in the Forex market, and which are known as major currencies. These are exactly 8: dollar (USD), euro (EUR), yen (JPY), pound sterling (GBP) and the Swiss franc (CHF) dollars Canadian (CAD), Australian (AUD) and neozenlandes (NZD).

Among all the major currencies, the USD is by far the currency Forex star, being present in more than 80% of transactions.

The rest of currency are known as minor currency, and as residual volume within the globality of the Forex market which is advisable to park in the operative especially in the beginning.

What currency pairs Trade Forex?

Once we know the FX majors and minors, since that Forex what really is operated are not currency itself, but crosses of currency, notably the existence of four pairs that are the real protagonists of the Forex, and which are known as the Forex Majors: euro-dollar (EUR/USD), the libra-dolar (GBP/USD), the dolar-yen (USD/JPY) and the Swiss franc (USD/CHF).

The Majors receive that name precisely because it pairs with higher trading volume, and it is worthwhile to become familiar with Forex closely following the evolution of these currency pairs which focus the negotiations on the market. In addition, being most traded currency pairs, they will gain greater liquidity and therefore some tighter spreads, which interested in order to minimize the cost of our operations.

At what times I can operate in the Forex market?

Although it is true that Forex is a market open 24 hours a day, it also is there much more propitious times to operate it properly. That is, there are hours where the Forex market presented greater liquidity and movement, and therefore gives greater opportunities for good operations.

The main session of the Forex market are three: Tokyo (or Asian) session, of London (or European) and the United States (or American), being the session in London that typically presents best movements in the prices of currency pairs.

Temporarily ordered the different sessions, and always in time Spanish Peninsula (GMT + 1), Tokyo opens at 1:00 am and closes at 10:00, London opens at 9:00 and closes at 18:00 and the United States opens at 14:00 and closes at 23:00. As you can see, there are certain times that agree to open two sessions, and therefore the volume of trading in those slots will be higher. Specifically, from 9:00 to 10:00 coincide the closure of Tokyo with the opening of London, and from 14:00 to 18:00 the opening of United States with the closure of London. These stripes are especially active, so it may be a good choice to start to Trade Forex.

As a final tips to know when to operate and when, there to know that there are numerous studies that indicate that Tuesday and Wednesday are the days that the Majors have a few major movements in pips. It also should avoid as far as possible operate during news affecting operated pairs and on holidays in the country of origin of the currency operated. It is not a very good day of operational Friday and days in general with little movement, as on Sunday.