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FOREX: What Is It And How Does It Work? Print
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FOREX: What Is It And How Does It Work?

 

Forex, Trading Forex, Online Forex Trading, Forex Currency

 


FOREX — the foreign exchange market or currency market or Forex is the market where one currency is traded for another. It is one of the largest markets in the world.



Some of the participants in this market are simply seeking to exchange a foreign currency for their own, like multinational corporations, which must pay wages and other expenses in different nations than they sell products in. However, a large part of the market is made up of currency traders, who speculate on movements in exchange rates, much like others would speculate on movements of stock prices. Currency traders try to take advantage of even small fluctuations in exchange rates.

In the foreign exchange market there is little or no 'inside information'. Exchange rate fluctuations are usually caused by actual monetary flows as well as anticipations on global macroeconomic conditions. Significant news is released publicly so, at least in theory, everyone in the world receives the same news at the same time.


Forex, also known as foreign exchange or FX, is the simultaneous buying of one currency while selling another. The forex market is available 24 hours a day, five days a week and it’s one of the largest, most liquid financial markets in the world. Just to compare, the New York Stock Exchange makes about $169 billion a day in volume and the Forex Market makes over $5 trillion a day in volume.


How Does Forex Work?

Forex market, Forex exchange, Forex signal

The Foreign Exchange market, also referred to as the "Forex" is the biggest and largest financial market in the world. It has a daily average turnover of US$1.9 trillion- just imagine that amount of money! Don't you want to join this trillion-dollar industry?


Forex is the simultaneous buying of one currency and selling of another. Currencies are traded in pairs, for example Euro/US Dollar (EUR/USD) or US Dollar/Japanese Yen (USD/JPY). So basically, Forex is trading.

There are two reasons to buy and sell currencies. About 5% of daily turnover is from companies and governments that buy or sell products and services in a foreign country or must convert profits made in foreign currencies into their domestic currency.


The other 95% is trading for profit, or what you call speculation. Investors frequently trade on information they believe to be superior and relevant, when in fact it is not and is fully discounted by the market.


On one side of each speculative stock trade is a participant who believes he has superior information and on the other side is another participant who believes his information is superior.

For speculators, the best trading opportunities are with the most commonly traded (and therefore most liquid- meaning its in cash or convertible to cash) currencies, called "the Majors." Today, more than 85% of all daily transactions involve trading of the Majors.


The Forex market is considered an Over The Counter (OTC) or 'interbank' market. This is because the transactions are conducted between two counterparts over the telephone or via an electronic network. Trading is not centralized on an exchange compared to stocks and futures markets.Understanding Forex quotes


Reading a Forex quote may seem a bit confusing at first. However, it's really quite simple if you remember two things: 1) The first currency listed first is the base currency and 2) the value of the base currency is always 1.


The US dollar is the centerpiece of the Forex market and is normally considered the 'base' currency for quotes. In the "Majors", this includes USD/JPY, USD/CHF and USD/CAD. For these currencies and many others, quotes are expressed as a unit of $1 USD per the second currency quoted in the pair. For example, a quote of USD/JPY 110.01 means that one U.S. dollar is equal to 110.01 Japanese yen.


When the U.S. dollar is the base unit and a currency quote goes up, it means the dollar has appreciated in value and the other currency has weakened. If the USD/JPY quote we previously mentioned increases to 113.01, the dollar is stronger because it will now buy more yen than before.

The three exceptions to this rule are the British pound (GBP), the Australian dollar (AUD) and the Euro (EUR). In these cases, you might see a quote such as GBP/USD 1.7366, meaning that one British pound equals 1.7366 U.S. dollars.


In these three currency pairs, where the U.S. dollar is not the base rate, a rising quote means a weakening dollar, as it now takes more U.S. dollars to equal one pound, euro or Australian dollar.

In other words, if a currency quote goes higher, that increases the value of the base currency. A lower quote means the base currency is weakening.


Currency pairs that do not involve the U.S. dollar are called cross currencies, but the premise is the same. For example, a quote of EUR/JPY 127.95 signifies that one Euro is equal to 127.95 Japanese yen.


When trading Forex you will often see a two-sided quote, consisting of a 'bid' and 'offer'. The 'bid' is the price at which you can sell the base currency (at the same time buying the counter currency). The 'ask' is the price at which you can buy the base currency (at the same time selling the counter currency).

If you want to know more about how to start trading in Forex,

want to: open Demo Account

 

And IBs please, Visit to our Website http://www.5starsforex.com .

 
5StarsForex MultiTerminal4 Print
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5StarsForex MultiTerminal4

One Platform Multiple Benefits

Download                                                         Download Mannual

 

The 5Starsforex MultiTerminal platform provides a practical and convenient way to manage multiple accounts simultaneously from a single interface. Users of the 5Starsforex MT4 Terminal will find a very familiar trading environment with all the power of the MT4 with even greater functionality.

Key Features & Benefits:

  • Unlimited number of trading accounts supported
  • Real-time trading activity management
  • Execution of multiple order types
  • Live price feed monitoring
  • Viewable trading history
  • Familiar and easy to use MT4 interface

System Requirements:

Microsoft Windows 98 and above

 

 

 

 
5Stars Forex: Web trading Print
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Web Trading

Our online web trading platforms, Visual Trading Machine, allows you to trade from any computer wherever you are in the world. Sophisticated tools and unique features make Visual Trading Machine one of the most sophisticated online-based forex platforms on the market.

Real-time rates feed, one-click Trading, freeze rate and live market news are just a few of these features. Fully transposable with our downloadable web trading platforms, TradeDesk™, means that you can open a deal with Visual Trading Machine and then close the same deal in TradeDesk™

Open Real Account

Open Demo Account

Become Our Partner

 
Advantages of the Forex Market Print
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Forex, Fx, Online Trading, Trading fx, Currency Trading

 

 

The Forex or foreign exchange market has many advantages over other types of trading. Since it is an OTC (over-the-counter) market, the Forex market is open 24 hours a day, unlike the regular stock or commodity markets. Most investments require a significant amount of money before you can take advantage of that investment opportunity. You only need a small amount of capital to trade Forex. Everyone can enter the market with as little as $1 to trade a "micro account", which allows you to open positions of 1,000 units. One lot of 1,000 units of currency is equal to 1 contract in micro account. Each "pip" or "tick" (smallest currency rate movement up or down) is worth $0.10 profit or loss, depending on wheather you are going with the market or against it. A Forex mini account gives you control over 10,000 units of currency, where one pip is worth $1.00. While a standard account gives you control over 100,000 units of currency, and a pip here is usually worth $10.00.


Forex is also one of the most liquid markets. When trading currencies on the spot Forex market you have full control of your capital, meaning that you can buy and sell your positions anytime during market open period. This is a definite advantage because, if you need to use your account money, it can be accessed immediately without additional commission or waiting periods. Many other types of investments require holding your money up for rather long periods of time.

Also, in Forex, with a small amount of money, you can control bigger market positions using the leverage or margin trading. Leverage of 1:100 is common in the Fore market. It allows you to control amounts 100 times bigger than your capital, while leverage of 1:500 and 1:300 and 1:200 can be found with some offshore companies.


Forex traders can be profitable in bullish or bearish market conditions. Stock market traders need stock prices to rise in order to take a profit, since short-selling is a subject to strict limits in stock exchanges. Forex traders can make a profit during both uptrends and downtrends. Forex trading is rightfully considered risky but with a good trading system to follow, good money management skills, and some level of self-discipline, the risks of Forex  trading can be minimized considerably.


The Forex market can be traded anytime and anywhere. As long as you have access to a computer and internet, you have the ability to trade the Forex market. An important thing to remember before jumping into trading currencies is that it is worth practicing with "paper money", or "fake money", on the demo account. Foreign Exchange Broker have demo accounts where you can download their trading platform and practice in real-time with real market data but with "virtual money". While profitable demo trading cannot guarantee your success with real money, practicing can give you a huge advantage to become better prepared when you start trading with your real, hard-earned money.

 

If you want to know more about how to start trading in Forexwant to 

 


Open Demo Account 

Become Our Partners 


please, Visit to our Website  .

 

 
5Stars Forex: WHITE LABELS PROGRAM Print
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WhiteLabel Partnership Solution

5StarsForex provides the opportunity for the creation of White Label partnerships to match the needs of regulated companies and organizations looking for advanced trading solutions. 5StarsForex partners benefit from our experienced corporate infrastructure resulting in the White Label partner only having responsibility for administrative and back office work and ongoing relationship management with their clients.


 

  • We provide a familiar online trading platform interface branded under each partners name. This reduces your     responsibility to provide platform support and accounting personnel.
  • There are no hidden fees in our white label process and there are no development costs. Our white label programs are     simple to implement and cost effective.
  • 5StarsForex works closely in supporting your efforts to reach the pre-determined goals. We use the API’s (Application      Programming Interface) and Financial Information exchange (FIX) Protocol.

Our platform allows for what is known as Straight Through Processing (STP) of trades, from broadcasting the prices directly from interbank liquidity providers, sending the customers trades for execution, trade confirmation, and the creation of the daily and monthly account statements. Further you have the ability to charge your clients commission for each trade. You can benefit from our professional customer support services and have direct access to our ECN price feed and competitive spreads

 

 

 

 

 

 
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