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Forex Basics
By Gilbert Murray
This an article that intends to introduce beginning traders to all the essential aspects of foreign exchange. I will start by identifying and defining the essential aspects of foreign exchange trading, and key components that you will be exposed to as a forex trader.
Forex is the largest financial market in the world. Daily trading volume exceeds $1.5 trillion. Comparing this to other financial markets such as equities at $50 billion daily trading volume, and the futures market at $30 billion in daily volume you can begin to realize the flexibility and infinite trading liquidity the FOREX has to offer. The FOREX is a 24 hour market. This means flexibility for you as a trader. This market never closes. You can always find good trading opportunities at your convenience. This is a 24 hour electronic online currency exchange.
Currencies are traded in pairs. Meaning when you buy one currency you are selling the cross currency. The position that you take long or short is indicative to how you think that pair will perform. For example, if you were to buy long USD/GBP, you are betting that the USD (US Dollar) will increase in value against the GBP (Great Britain Pound). You are actually buying the USD and simultaneously selling the GBP. If you were to go short on this pair you would be betting that the USD is going to decrease in value against the GBP. It can get confusing but fortunately the services that provide the trading platforms from which you will be placing trades will keep track of this for you. Everything is electronic and online, trading is done in real time. You can watch immediate results of all your trades. These are highly sophisticated programs tracking every movement in the currency market in real time.
FOREX is a highly speculative market. Money can be won and lost as with any speculative venture. It is essential that you as a trader have a solid understanding of the FOREX and how to trade currencies. You can discover more about this very lucrative money making opportunity by clicking http://www.trade4xforprofit.com/