Forex Day Trading System

Day Trading SystemThe Forex market is the biggest financial market and it’s the place where the currencies are traded for one another. These currency trades are being done by individuals, organizations, brokers and banks and the fluctuation in the exchange rates of the currencies allow them to make a profit, as long as the right decisions are made when buying or selling. The Forex market is a bit similar to a stock market, since the exchange rates of currencies will vary depending on the events from the real world. Something that is special about this market is that there isn’t a single central location where this business id done. Computer networks help organize the trade, and traders use it to buy or sell currency, no matter where they are in the world. This market runs for the entire duration of the work week, 24 hours a day. No matter in what time zone you are, you can do Forex trading with the help of the Internet.

The second world war made the nations of the Western world to sign an agreement which gave each currency a certain value, based on the value of the dollar. At the time, the dollar had a value of $35 for one ounce of gold, which was fixed. This agreement helped the economy of the world to stabilize, which was needed, because of the war. In the beginning it was OK, but eventually the agreement ended, in 1971. At that time, the exchange rates were allowed to fluctuate again and the US was leading the market. The practice of trading currency started at that point, though the Internet really helped to develop the Forex day trading system. These days, around $3 trillion are traded on the Forex Market on a daily basis.

If you or an organization wants to trade and make money with Forex, it can be done in one of three ways: by using the futures market, the forwards or the spot market.

The spot market allows currency to be sold or bought, at the price which is currently in place. The spot market is the biggest market of the three we mentioned. As for the forwards market and the futures market, these deal with the contracts which have a settlement date in the future. They also have a certain price per unit and certain currencies which are traded. These two markets are mainly used by companies these days, when they’re looking to make sure they don’t risk too much with their trades. The Internet helped the spot market rise, since the futures market was much bigger before trading and information became so easy.

The regular Forex market is based on liquidities and it just trades a currency for another. The volatility is quite high and it can fall or grow quickly, so you can make a profit or lose money after just a couple of minutes after the trade begins. There is some software available though, which you can use to make sure that the risks are minimized as much as possible. This type of software can help you make a profit even during tougher times.

What is Forex

The Forex market stands for foreign exchange and it’s used to buy and sell currency. This is a market which is considered over the counter and you can use it to trade currency from all the countries in the world. The CFTC is an organization which regulates this market, while the NFA looks after the brokers. This market is the most liquid in the world and it’s open 24 hours a day, during the work week, stopping for the weekend.

The currency rates are always expressed in pairs, since no trades for real goods are done. Everything is done by bartering, so each currency has a certain value when compared with another currency. An example would be a dollar, which could trade fo 0.709 Euro.

A small currency movement is known as a pip and it’s the unit which tells you how much profit or loss you have. One pip would be a movement of .0001 for example, when EUR and USD are compared. An increase of 1% between these two currencies would mean a 100 pips increase.

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