Monday, December 1, 2008
ForexGen | Smart Traders Take Advantage Of The Markets
The forex market, also referred to as the "FX" or forex market is the largest financial market in the world, with a daily average turnover of well over US$1 trillion -- 30 times larger than the combined volume of all U.S. equity markets.
forex market 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).
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 forex market into their domestic currency. The other 95% is trading for profit, or speculation.
For speculators, the best trading opportunities in the forex market are with the most commonly traded (and therefore most liquid) currencies, called "the Majors." Today, more than 85% of all daily transactions involve trading of the Majors, which include the US Dollar, Japanese Yen, Euro, British Pound, Swiss Franc, Canadian Dollar and Australian Dollar.
A true 24-hour market, forex market begins each day in Sydney, and moves around the globe as the business day begins in each financial center, first to Tokyo, London, and New York. Unlike any other financial market, investors can respond to currency fluctuations caused by economic, social and political events at the time they occur - day or night.
The forex market is considered an Over The Counter (OTC) or 'interbank' market, due to the fact that transactions are conducted between two counterparts over the telephone or via an electronic network. Trading is not centralized on an exchange, as with the stock and futures markets.
What is forex market or Foreign Exchange: It is the leading financial market in the world, with a volume of more than $1.5 trillion daily, trade in currencies. the forex market has no actual location, no central exchange. It operates through an electronic network of banks, corporations and individuals trading one currency for another.
What about Forecasting: Predicting present and future market trends with submitted data and details. Analysts rely on technical and fundamental statistics to predict the course of the economy, stock market and individual securities.
For those who trade with the forex market, or foreign currency exchange, aware of how to forecast the forex market can make the difference between trading successfully and losing money. When you start learning about forex market, it is necessary that you understand how to forecast the forex market trading market.
What we have explored up to now is the most important information you need to know. Now, let us dig a little deeper.
There are a few systems that are used when forecasting the forex market. Each system is used to understand how the forex market operates and how the fluctuations in the market can influence traders and currency rates. The two systems that are most commonly used are called technical analysis and fundamental analysis. Both systems vary in their own ways, but each one can help the forex market trader understand how the rates are moving the currency trade. Most of the time, experienced traders and brokers know each system and use a mixture of the two to trade on the forex market
One system used in forecasting foreign currency exchange is called technical analysis. This system uses predictions by looking at trends in charts and graphs from past forex market market happenings. This system is based on concrete events that have actually taken place in the forex market in the past. Many experience forex market traders and brokers rely on this system because it follows actual trends and can be somewhat reliable.
When looking at the technical analysis in the forex market, there are three central principles that are used to make projections. These principles are based on the market action in relative to current events, trends in price movement and past forex market history. When the market action is looked at, everything from supply and demand, current politics and the present situation of the market are taken into
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