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Forex (FOREX, Foreign Exchange Market) – is the international currency-exchange market of the converted currencies. Oscillations of their courses under the ratio to each other allow to buy currency cheaper and to sell more expensively. Thanks to development of Internet trading millions people all over the world can do the business neo accessible earlier only to banks and large corporations.

Where is Forex?

This market does not have certain location. It represents the huge network of currency dealers united by telecommunications. They are in all leading world financial centers and work round the clock, as the uniform mechanism. Quotations of currencies do not stop for a minute.

What currencies are loved by Forex?

The most liquid currencies are US dollar USD, English pound GBP, uniform European currency EUR, the Swiss franc CHF, the Japanese yen JPY. On their share the main size of all operations in market FOREX is laid.

What is the currency pair?

Currency pair, or cross-country-course, represents the traded tool of market FOREX. At transaction FOREX always trade in currency steams. For example, at transaction on currency pair USD/JPY, you trade in the American dollars against the Japanese yen. Buying dollars at the given cross-country-course, you pay in yens. Selling dollars – you receive the Japanese yens on your account.

What isa pip or an item?

Word “pip”– is an abbreviation of an English word-combination “percentage in point” (the percentage item). Pips – are minimum possible steps of the price. Quotations of the majority of currency pairs are exposed to within the fourth sign after a comma. Therefore, movement of the price of currency pair from level 1.2950 to 1.2951 makes one pips. It is possible to define cost of one pip for a concrete position. For example, knowing that the quotation on currency pair EUR/USD is given to within the fourth sign after a comma, we will increase the position size by cost of one pip which makes for given currency pair USD 0.0001. Cost of one pip under contract EUR/USD 100,000 makes USD 10.

How to earn on Forex?

If for you have 1000 USD on your account, without risking the main deposit, it is possible to conclude the bargain on a prize in 10000 USD (a prize 0,1). Expecting course change USDJPY, we buy 10000 USD against the Japanese yen at the price of 118.00. In some days course USDJPY has grown on 200 items and has become 120.00. We close a position and we sell dollars more expensively. We will define profit (or the loss) from the transaction. We will increase a difference of the prices of closing and opening by size of a prize and we will divide into the closing price. The profit is equal in our example:

(121-118) x10000/121=165 USD (or 16 % to the deposit)

Who are participants of the market?

The main participants of the currency market are central and commercial banks, currency stock exchanges, the corporations which are carrying out the foreign trade operations, investment funds, the broker companies and private persons.

How does Forex involve the private investor?

Operation on Forex is attractive by the fact that a trader operates with the market sums of hundred thousand dollars, without having the big money resources in stock. For example, for transaction carrying out at pledge in 1 % it is necessary to bring only 1000 dollars of pledge in 100 000 dollars.

Why is Forex popular?

FOREX exceeds all existing markets in sizes of the auctions, low cost of spent transactions, speed of movement of funds. It is the unique world market operating of 24 hours a day.

The choice of a foreign currency trading service is not an easy task. And one shouldn’t dash to make a decision on such a service.

It is very important that you follow a final piece of advice – today the Internet technologies give you a really unique chance to choose what you want at the best terms which are available on the market. Strange, but most of the people don’t use this opportunity. In real practice it means that you should use all the tools of today to get any foreign currency trading info that you need.

Search Google or other search engines. Visit social networks and have a look on the accounts that are relevant to your topic. Go to the niche forums and join the discussion. All this will help you to create a true vision of this market. Thus, giving you a real opportunity to make a wise and nicely balanced decision.

P.S. And also sign up to the RSS on this blog, because we will everything possible to keep updating this blog with new publications about the topic of how to trade foreign currency and important trends on the currency exchange market.

I want to tell you what term “Forex” means in what of its advantage.

Continuous process of an exchange of one foreign currency on another is caused by variety of the reasons – from conditions of calculation on the contracts concluded by transnational corporations, before reception of the bank credit under lower interest rates.

In connection with constant necessity for an exchange of foreign currencies the uniform telecommunication network allowing millions of sellers and buyers of currency was generated to make exchange operations round the clock from every spots on the globe.

Set of conversion operations on a currency exchange has on a global scale received name FOREX (Foreign Exchange Market).

In the course of currency market Forex formation there was a new kind of business which is based on extraction of profit on a course difference in the conditions of free and constant change of rates of exchange. Thus change of rates of exchange is regulated only by a supply and demand. Investors who make similar operations, it is accepted to name traders (dealers). Now any interested person can test as the trader of Forex. To begin career of the currency trader it is possible at any age, thus formation and the previous operational experience do not render so considerable influence on success of the trader as congenital analytical abilities and ability somewhat to feel behavior of the market.

Let’s consider market Forex development.

For last three decades Forex has developed in the largest financial market in the world which day turn makes from 1 to 3 billion US dollars. The basic currencies in this market are US dollar (USD), euro (EUR), the Japanese yen (JPY), the Swiss franc (CHF) and English pound sterling (GPB). Today operations in market Forex are one of the basic sources of the income of banks and financial institutions all over the world.

Today’s Forex is a uniform telecommunication network of the banks connected among themselves and other financial institutions, not having territorially certain place of trade and temporary restrictions – the auctions begin on Monday morning in New Zealand and are closed on Friday evening in the USA. Any interested person, without dependence from its site as for carrying out of operations in market Forex access to a network the Internet and necessary knowledge is required only can become the participant of the currency market.

To learn working in such branch as exchange business and to derive from trade in currency profit, it is necessary to be able to analyze a securities market. Certainly, trade at a stock exchange is a skill, both experience comes in due course and practice, therefore in the beginning it is possible to take advantage of a demo-account which will allow learning to work with currency without a cash payment.

Many successful traders, learnt to trade in currency on a demo-account. Thanks to the broker companies which give a credit shoulder, you can put in Forex (Forex), rather small sum of money and trade in larger sums; it opens more possibilities for you in trading sphere.

The choice of a foreign currency trading service is not an easy task. And one shouldn’t hurry up to make a decision on such a service.

It is very important that you follow some general tips – today the online technologies give you a really unique chance to choose what you require at the best terms which are available on the market. Strange, but most of the people don’t use this opportunity. In real practice it means that you must use all the tools of today to get any foreign currency trading info that you need.

Search Google and other search engines. Visit social networks and check the accounts that are relevant to your topic. Go to the niche forums and join the online discussion. All this will help you to build up a true vision of this market. Thus, giving you a real opportunity to make a smart and nicely balanced decision.

And also sign up to the RSS on this blog, because we will everything possible to keep this blog tuned up to the day with new publications about the topic of how to trade foreign currency and important trends on the currency exchange market.

The continuous process of exchange of one foreign currency on other is conditioned whole in a number of reasons – at the terms of calculation on contracts, to concluded multinational corporations, to the receipt of bank credit on more low interest rates.

In connection with a permanent necessity a single telecommunication network, allowing millions of salespeople and buyers of currency to make the operations of exchanges round-the-clock from any points of earth, was formed in the exchange of foreign currencies.

The aggregate of operations of conversions on the exchange of currencies on a world scale got the name FOREX (Foreign Exchange Market- international currency market).
Risks in the market Forex.

Despite all possible pluses, as well as in any financial market, there are risks on Forex. I will not mention a theme of how to secure ourselves against senseless loss of money, being conducted by legal swindlers on Forex, and I will tell about risks which concern directly the auctions. Among the main risks about which it is necessary to know to each participant of the auctions on Forex, it is necessary to allocate the following: huge speed of reactions and variability, zero margin and losses because of a shoulder (lever), variability of market Forex.

The round-the-clock nature of the market and rather small quantity of tools does Forex very changeable. It is important to understand that courses are influenced by any macroeconomic news of the countries. And it is a lot of such news and they are popular. And when any such news is published, traders quickly react. Currency market is accessible 24 hours a day. Therefore, in the market Forex it is necessary to react quickly and to hold actives in a complete control.

To play on credit will give nobody.

Because of the wave nature of fluctuations of financial tools, the private investor quickly loses the real money. As soon as real money is lost, the broker house closes your account, and does not allow losing on credit. Even if the course after that falling has filed up at once, and you would earn a heap of money, to you will not allow losing money of the broker. In the theory, margin, i.e. the borrowed sum for the auctions, is real, but in market Forex you will not been allowed to lose it.
Before entering the auctions, it is necessary to know accurately about all advantages and risks in the market Forex . In spite of the fact that the currency market Forex is very attractive on the one hand, it also is very brave on the other hand. Only when you understand all specificity of the auctions on Forex it is possible to start the auctions.

Certainly, I have not described all details, but it is very important to understand the main risks and advantages of the auctions on Forex is psychological factor. Very much a great deal depends on a man, his character and thought.

The selection of a foreign currency trading service is not an easy task. And one shouldn’t dash to make a decision on such a service.

It is very important that you follow a final piece of advice – today the Internet technologies give you a really unique chance to choose exactly what you require for the best price on the market. Funny, but most of the people don’t use this opportunity. In real practice it means that you should use all the tools of today to get any foreign currency trading information that you need.

Search Google or other search engines. Visit social networks and have a look on the accounts that are relevant to your topic. Go to the niche forums and participate in the discussion. All this will help you to build up a true vision of this market. Thus, giving you a real opportunity to make a wise and nicely balanced decision.

P.S. And also sign up to the RSS feed on this blog, because we will everything possible to keep updating this blog with new publications about the topic of foreign currency trading for dummies and important trends on the currency exchange market.

How to choose the broker in Forex market?

Choice of a Forex broker — is not an easy task. What is it necessary to pay attention on making decision about the beginning of cooperation with this or that financial company? Good Forex broker, first of all, should be reliable, offer good trading conditions and conveniences of work. Serious investors choose large western broker houses, first of all, because of the reasons of reliability.

The reliable broker is the broker who has following components of reliability definition:
- Long history of work;
- The license and submission to control of regulating bodies;
- The debugged system of risk-management in the company;
- System of insurance of the responsibility before clients;
- Security of contractual relations;
- Legal transparency.

The process of licensing cuts obvious swindlers. The financial company is obliged to open before the state its owners, to give authorized documents, the accounting reporting. Besides, regulating bodies supervise financial indicators of the company, operative activity.

Unfortunately, presence of licenses and a submission to control does not give to the regulating organizations a guarantee of safety of your money. However it is serious plus in a choice of the broker in the Forex market.

Besides, the broker company still should be enough respectable. It is heavy to argue whether a company has a positive reputation and if it has what signs can show this to judge about it. Indicator of good reputation – this is only a question of money. And about presence of negative reputation (whether it be proceedings or the deceived clients), it is possible to find out easily enough by means of Internet sites and specialized forums.

Working conditions are certainly important in any business. To qualitative working conditions are included: exact quotations and competitive spreads, trade with the guaranteed execution of the postponed warrants, a modern trading platform, wide toolkit, percent charges on the trading deposit of clients.

The important moment at a choice of a broker is the riches of toolkit which is accessible to trade in the company. After all it is very important to try the forces in the different markets, with different tools and conditions.

The important factor is charge of percent on means for the trading account of the client, and also possibility to trade in discrete prizes. The common standards of large brokers are following:
- Round-the-clock news support for clients in the trading terminal.
- Daily analytical researches of the markets of currencies, actions, indexes, metals.
- 24 hours technical support.
- Presence of the personal manager for big clients
-
Important component to choose a broker is granting of the trading terminal with the standards for brokers in the market Forex:
- Presence of a free demo-account (i.e. possibilities to be trained on virtual money).
- Graphic support, possibilities of the technical analysis, or export of the data to systems of the technical analysis (Omega, etc.).
- Reliability of functioning and low requirements to the user ‘s computer, and speed of Internet connection.

The selection of a foreign currency trading service is not an easy task. And one shouldn’t hurry up to make a decision on such a service.

It is very important that you follow a final piece of advice – today the Internet technologies give you a really unique chance to choose exactly what you need at the best terms which are available on the market. Strange, but most of the people don’t use this chance. In real life it means that you should use all the tools of today to get any foreign currency trading information that you need.

Search Google or other search engines. Visit social networks and have a look on the accounts that are relevant to your topic. Go to the niche forums and participate in the discussion. All this will help you to create a true vision of this market. Thus, giving you a real opportunity to make a wise and nicely balanced decision.

And also sign up to the RSS feed on this blog, because we will do the best to keep this blog tuned up to the day with new publications about the topic of foreign currency trading companies and important trends on the currency exchange market.

Forex game
Katie Linn and Boris Shlossberg

Katie Linn is the main strategist of company “FXCXI” in New York. Her book “Intra-day trade in the currency market: technical and fundamental strategy of reception of profit on market fluctuations” (2005), written both for beginners and for experts, has received wide recognition. Katie conducts seminars on trade in the currency market across all United States and also has written many articles for “CBS Market Watch”, “Active Trader”, “Futures magazine” and “SFO magazine”. Boris Shlossberg is the currency strategist of the world’s largest retail market-maker of market Forex “Forex Capital Markets” in New York. His articles on appropriate management of risk, psychology of the trader and market dynamics are monthly published in magazine “SFO”. Boris Shlossberg is the independent trader from 1999 in the share market, options, futures and currency.

What does Forex currency market make attractive?

There are 10 principal causes why the currency market represents a remarkable place for trade:

1. You can trade in any style – strategy can be constructed on the basis of five-minute, hour, day or even week schedules.
2. In an easy approach there is information of large quantity – schedules, news in real time, analytical researches etc.
3. The key information is popular and extends immediately.
4. It is possible to receive percent on transactions even on the day basis.
5. The sizes of positions can vary, meaning that you can trade with the sum of 500$ almost with the same operational expenses, as on the account of 500 million $.
6. Independently established levers allow you be both very conservative, and too aggressive, on your choice (levers can vary from 1:1 to 1:500).
7. There is no any commission that means that the result of each transaction is defined by simple value of profit.
8. You can trade 24 hours a day, practically without testing a liquidity lack.
9. There is no difference between trade in the short and long party.
10. You cannot lose money more than it is available for you on the trading account.

10 rules
1. Never allow an advantageous position turn in the lost one.
2. Logic transactions conduct to profit, impulsive to losses.
3. Never risk more than 2 % from the trading capital in one transaction.
4. Choose positions to the basis of fundamental factors, inputs and an exit – on the basis of technical.
5. Always choose the pair combining strong currency from the weak.
6. Try to be right, but remember, that to enter ahead of time means to appear wrong.
7. Distinguish crushing of a position and escalating of the lost one.
8. Understand that mathematical optimum variant is often impossible in the psychological relation.
9. The risk can be predetermined in advance, but the profit is unpredictable.
10. Never do any justifications.

Trade is an art, not a science. Therefore remember that any rules in trade are never absolute. However, these 10 rules well work in various market conditions, and will help you to be kept “afloat”, and be protected from the big troubles.

The selection of a foreign currency trading service is not an easy task. And one shouldn’t dash to make a decision on such a service.

It is very important that you follow a final piece of advice – today the online technologies give you a truly unique chance to choose exactly what you require for the best price on the market. Funny, but most of the people don’t use this chance. In real practice it means that you must use all the tools of today to get any foreign currency trading information that you need.

Search Google and other search engines. Visit social networks and have a look on the accounts that are relevant to your topic. Go to the niche forums and join the discussion. All this will help you to build up a true vision of this market. Thus, giving you a real chance to make a wise and nicely balanced decision.

P.S. And also sign up to the RSS on this blog, because we will do the best to keep this blog tuned up to the day with new publications about the topic of learn foreign currency trading and important trends on the currency exchange market.