Forex21 | Forex Verdad O Mentira
What is Forex?
Forex is the acronym for "currency market", furthermore known as the Portuguese currency market. The currency is the financial circulate following the largest dimension and the highest liquidity in the world, similar to more than 4 billion dollars a morning in want ad movements. The size of the foreign difference of opinion broadcast is such that the trading volume of the extra York hoard squabble does not even attain 2% of those realized in the currency.
Currency pairs and exchange rate
In forex trading later currency pairs (cryptomoedas and more). By analyzing the EUR / USD squabble rate, you can see how many USD (listed or auxiliary currency) you infatuation to purchase 1 EUR (base currency).
Therefore, if the quarrel rate of the EUR / USD currency pair is 1.2356, this means that each euro can buy 1.2356 dollars.
If the difference of opinion rate increases, it means that the base currency has strengthened against the subsidiary currency. If the quarrel rate eventually decreases, it means the opposite.
The characteristics of the Forex or Forex market
- Liquidity: Because of the $ 5 billion that circulates daily, the foreign quarrel shout out is considered the most liquid announce in the world. Basically, this means that you can buy any currency whenever you want, as long as the publicize is open.
- full of life and decentralized: the foreign dispute spread around is a functioning and decentralized market, meaning that any trader can invest anywhere in the world and, consequently, impinge on the price trend of a pair.
- 24/5 hours: A key factor that characterizes trading upon the foreign row spread around is the number of hours of operation; The foreign clash shout from the rooftops is right of entry 24 hours a day, five vigorous days a week, which makes it unconditionally attractive for many traders.
What are the factors that play the foreign quarrel market?
As currency transactions are immediate, the price of foreign dispute is affected by the feat of supply and request and, consequently, by speculation.
Thus, stability and the embassy and economic events, as well as the monetary policy of the countries, are elements that picture the contributions.
- Shares of private and public economic agents. Financial institutions, governments and central banks in each country can directly play a role the price of a currency by adopting definite economic procedures and announcements. For example, a rise in immersion rates in the US Federal remoteness would addition the value of the US currency.
- Political, social and economic events. If Forex participants take on that a social event, can assume the political, economic or natural strengthening or fall in a currency, they will amend the publicize price considering its operations that allow modify and request for the currency concerned.
The more people put up with that a consistent trend is followed, the more it will pretense spread around prices, as this will reflect market sentiment.
Recent major events such as Brexit or the US elections directly and brusquely influenced the value of currencies.
Reports of economic and social organizations. Debt analysis in imitation of the IMF, large loans from the EU or the health of the industry in a given country (especially the huge powers), as well as data upon unemployment and inflation, still find the money for a more translucent vision of what might happen on the markets and in the economy, for that reason it as a consequence has a rather accentuated weight below the currency.
What should I reach subsequently I trade in the currency?
Forex Trading always involves trading taking into consideration a currency pair. For example, if you think the pound sterling (GBP) will value against the dollar, you should purchase the GBP / USD currency pair.
If, on the contrary, we expect a devaluation, that is to tell that the dollar will strengthen, he will have to sell the currency pair he has.
The first engagement is called the buy position, which means that the trader wants to buy the base currency (GBP) and sell the auxiliary currency. In the second, the operator would edit a sales point to sell the pound sterling (GBP), the base currency.