Thursday, July 21, 2011

Forex Secrets


'What is a secret?' Answer is something that everyone knows but chooses not to see, speak or tell. Hence there are no insider Forex secrets that are withheld by the traders, any person can make really good strategies or incorporate already existing strategies in this form of trade. Apart from that one can also use some simple economic concepts and proven theories to trade currencies. Moving on to some Forex 'secrets'.

Forex Strategy & Secrets: The Basis

The Forex market is principally an international trading currency market which is managed by an enormous network of brokers and sub brokers and is open 6 days a week. Unlike a stock exchange, a Forex market deals in different currencies and their exchange rates. This market principally came into being to facilitate international trade. For example trade between Great Britain and USA at a point of time was done in USD and Pounds. The transaction here went through a currency transfer that is a Pound was converted into some Dollars.

The Forex market today is a dematerialized market where all currency trade is carried out though the Internet accounts of the brokers, sub brokers and investors. Now a Forex investor who is based in the United States who possesses USD will invest some amount in the European Euro, let's say $10. Upon better economic performance, the international value of the Euro will rise. In such a situation, the investor can re-convert the currency into USD again. However, now as a result of the rise in the value of the Euro, it will get converted into say $12 to $13. This is exactly how one makes profit on the Forex market. There are several different strategies that can be used to make a very hefty profit in the market.

Some Forex Secrets Revealed

As mentioned above the Forex secrets can be revealed, however, many of unknowingly already known them, though we may have very used them. Here are a few Forex trading secrets which you can use.
Learn the art of investing in rising currencies. There is nothing known as 'luck', when you deal in Forex. The purchase must be made just before the price rises and sale must be made just before it begins to fall. This will ensure a healthy profit margin.
Secondly one must be able to make an arbitrage trading. An arbitrage is purchasing at a lower price and simultaneously selling at a higher price. This will ensure that the profit margin is maximum.
Apart from arbitrage, it is also essential to ensure that you sell just before the fall. That is if you sell too early you will make a profit. However, you will lose the chance of making a healthy profit. To know the exact 'fall' point or the point of satiety, you will have to take up a deep study of the economies in which you are dealing with. Day-to-day events tend to affect this value differentiation.
You can also take up some related currency tools such as currency options trading or options agreement.
Some Forex traders keep on trading with a pair of currencies or multiple pair currencies. Such trading is quite convenient in the beginning phases. It is often considered to be the best among all Forex trading strategies for beginners.
In some cases, the investors deal in a small set of currency; and buy or sell if the currencies tend to breach some or the other barrier that they have set. This is among the best day trading strategies and it ensures a small profit margin. Some people also call it as a Forex Scalping Strategy.
There are some people who trade Forex for a Living. You can also take some unrevealed Forex secrets from them. Over all, Forex trading involves studying the economies and buying and selling the right currency at the right time. Good luck.

Major Currency Pairs


If you are looking for a major currency pairs list, this article has what you are looking for. Here you will find the currency pairs that have the largest trade share in the foreign exchange market.

Name one market which never closes, has the highest turnover volume in the world with people from all countries in the world participating in its day to day working. Yes, you guessed it right. It is the foreign exchange market, which extends its dominion all over the world. The market emerged out of a need for a system to facilitate the exchange of different currencies around the world, for the purpose of trade. Now it is the premier financial market of the world, which reflects the financial dynamics of world trade quite clearly. Every trade here is an exchange between currency pairs of different countries. The aim of this article is to present the major currency pairs that dominate the foreign exchange markets.

As the famous Hollywood movie 'Wall Street's' tag line says, money never sleeps and in case of the foreign currency exchange market it is literally true. As the Earth revolves around herself, sun rises and falls, the forex markets world over, keeps on opening and closing in order to facilitate uninterrupted currency trade. There are many currency pairs that are traded in this international market. Let us see what are currency pairs and how are they listed, before taking a look at the major currency pairs of the world.

About Currency Pairs

Foreign exchange trade or forex trading is all about buying and selling currencies in pairs or rather exchanging one for the other. For buying and selling currencies, one need to have information about how much one of the currencies in the pair is worth in terms of the other. The statement of this relation is made in terms of a currency pair. So a currency pair is the quoting of two currency abbreviations followed by a listing of the value of base currency with reference to the counter currency. The foreign exchange rates are decided by the import and export volumes between two countries.

There is an international code which specifies the nomenclature for stating currency pairs. For example, a quote like EUR / USD 1.23 means that 1 Euro is worth 1.23 USD. Here the base currency is Euro (EUR) and the counter currency is US dollar. Thus, every currency pair is listed in the foreign exchange markets across the world. Now let us have a look at the major currency pairs of the world.

Forex Major Currency Pairs

Not surprisingly, the most dominant and strongest, as well as most widely traded currency is the US dollar. It features in all the major currency pairs of the world listed below. The reason for this is the sheer size of the US economy which makes it the biggest economy in the world. US dollar is the currency that is the preferred reference in most currency trading transactions around the world. It is the dominant reserve currency of the world. Following are the forex major currency pairs that have high liquidity and take up the major share of forex transactions.
EUR/USD (Euro - US Dollar)
USD/JPY (US Dollar - Japanese Yen)
GBP/USD (Pound Sterling - US Dollar)
AUD/USD (Australian Dollar - US Dollar)
USD/CHF (US Dollar - Swiss Franc)
USD/CAD (US Dollar - Canadian Dollar)
The values of these major currencies keep fluctuating according to each other, as the trade volumes between two countries keep changing every year. For the latest currency exchange rates, refer to sites that offer live foreign exchange reports. They even have currency converters, which can calculate the value of a currency with reference to another, at the current market value.

So these are the major currency pairs of the world which are traded the most, all over the world. These major pairs are naturally associated with countries that are financial superpowers with high volume of trade conducted all over the world. The dynamics of the foreign exchange trade is an interesting subject of study as it can provide you with a pulse of the world economy, along with its rising and falling financial fortunes. As the wave of globalization engulfs most countries around the world, the fates of these major currency pairs are inextricably intertwined. Make sure that you study the foreign exchange market thoroughly before making an investment in this market which never sleeps!

Notes to Spreads

The spreads will constantly vary depending on market conditions such as volatility and liquidity and accordingly we can never guarantee a certain spread. You will, in order to get an understanding of the spreads, be able to see the:

Lowest Possible Spread, defined as the lowest possible spread we will, on occasion, provide you, and

Expected Average Spread, defined as the average spread we would expect you to see, in the table above.

For more information on ForexTrading.com's forex spreads, please visit the Forex Spreads section.

The spreads referred to above may vary from time to time especially for very active or inactive customers. ForexTrading.com reserves the right to amend the spreads, brokerage fees, margin rates and interest rates referred to according to the General Business Terms or Trading Agreement covering the client relationship between ForexTrading.com and the Client.

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