Originally Posted by
annura
This section aims at providing the essential information for the start forex traders. the subsequent topics are coated.
Basic ideas
Technical Analysis
Candlesticks Charting
Chart Patterns
Fibonacci Analysis
Technical Indicators
For additional advanced trading ways, keep in mind to download our free ebook Advanced Candlesticks and Ichimoku ways for Forex Trading.
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Basic ideas I: Introduction
The Foreign Exchange (often abbreviated as Forex or FX) market is that the largest market within the world with daily trading volume of over one.9 $trillion in September 2004*. With its high liquidity, low transaction price and low entry barrier, the 24-hour market has attracted investors round the world.
The following articles aim to introduce the key ideas in forex trading, the terminologies and therefore the characteristics of the FX market.
The articles 1st introduced the concept 'spread', that is that the most vital transaction price in forex trading, how the unfold is presented within the worth quotes, what's the importance of it and what's the trick behind it. As most of the retail customers opt to trade forex with margin account, the articles then introduced what's margin trading, what's the importance of margin, the way to trade a margin account and the way to settle on the right leverage ratio.
In trading on-line forex, there are many sorts of orders that you just will build to facilitate your trades. The articles then explained the rationale behind every form of orders, when and the way to use every of them.
Being one in all the foremost actively trading markets, the forex market is nevertheless, might not be the foremost acknowledge market. The articles then gave slightly historical background and explained the character of the forex market, and created an overall comparison of assorted trading markets. It conjointly mentioned the execs and cons of trading forex market and what are the recent trends.
Like any alternative trading instruments, traders ought to understand the terminologies and therefore the basis of the market before he/she starts real trading. The on top of articles function a vital beginners' guide to the planet of forex trading.
*According to the Triennial Central Bank Survey of the foreign exchange market conducted by the Bank for International Settlements and printed in Sept 2004
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Basic ideas II: Nature of the Foreign Exchange Market
The Foreign Exchange Market is an over-the-counter (OTC) market, which implies that there's no central exchange and clearing house where orders are matched. With completely different levels of access, currencies are traded in several market makers:
The Inter-bank Market - massive business banks trade with one another through the Electronic Brokerage System (EBS). Banks can create their quotes obtainable during this market solely to those banks with that they trade. This market isn't directly accessible to retail traders.
The Online Market Maker - Retail traders will access the FX market through on-line market manufacturers that trade primarily out of the US and therefore the UK. These market manufacturers generally have a relationship with many banks on EBS; the larger the trading volume of the market maker.
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Market Hours
Forex could be a market that trades actively as long as there are banks open in one in all the key money centers of the planet. this can be effectively from the start of Monday morning in Tokyo till the afternoon of Friday in big apple. In terms of GMT, the trading week happens from Sunday night till Friday night, or roughly five days, twenty four hours per day.
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Price Reporting Trading Volume
Unlike several different markets, there's no consolidated tape in Forex, and trading costs and volume don't seem to be reported. It is, indeed, doable for trades to occur simultaneously at totally different|completely different} costs between different parties within the market. sensible pricing through a market maker depends on that market maker being closely tied to the larger market. Pricing is typically comparatively shut between market manufacturers, however, and therefore the main distinction between Forex and different markets is that there's no information on the amount that has been traded in any given timeframe or at any given worth. Open interest and even volume on currency futures may be used as a proxy, however they're by no suggests that excellent.
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Basic ideas III: History and up to date Trend of on-line FX Market
The recently technology advancement has de-escalated the barriers that used to face between retail purchasers of FX market and also the inter-bank market. the web forex trading revolution was originated within the late 90's, that opened its doors to retail purchasers by connecting the market manufacturers to the top users. With the high-speed net access and powerful central processing unit, the web trading platform at home user's notebook computer currently is a gateway to the liquid FX market. Retail purchasers will currently trade in conjunction with the largest banks within the world, with similar pricing and execution. What used to be a game dominated and controlled by major inter-banks is turning into a typical field where people will take a similar opportunities as massive banks do.
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