Online Forex Trading Introduction

The online Forex market, also known simply as Forex, FX or the foreign exchange market is the biggest trading market in the world, with daily Forex trading that exceed $2 trillion.

Even tough we are talking about a huge market, Forex trading is quite simply - the buying of one currency while at the same time selling of another currency. If the trader can predict correctly which currencies will drop and which will rise - he will benefit from his investment.

There are a lot of benefits in Forex investing over other investment markets.

Why is Online Forex Trading Profitable?

The online Forex market has existed since the early 70's. Only in the past few years though, it has become accessible to millions of people through the development of the internet. Because the Forex market is available 24 hours a day, it's the only market that allows you to trade at your convenient time.

Today, because the economy is much more dynamic than it used to be, and the world has become a global village, economic conditions in various countries are also constantly changing, according to such factors as production rate, inflation and unemployment.

As a result, the rate of a specific currency changes and moves up and down in comparison to other currencies. This is the main reason of the process of rate fluctuations in the online Forex market.In order to evaluate and predict these Forex market changes a trader can use fundamental analysis or technical analysis as a tool for investment. Where as fundamental analysis is a more broad exploration into the economic factors influencing the online Forex, technical analysis uses charts and other indicators to asses price patterns taht re-occur over time and can help predict the forex market.

Foreign Currency exchange rate

Currency exchange rate is the ratio of one currency valued against another. For example, "EUR/USD exchange rate is 1.2505" means that one euro is traded for 1.2505 dollars. If you've already invested in other markets before, you'll find the Forex trading system quite similar, and the transaction to online Forex trading smooth. An example of a Forex trade: During October 2006 you buy 10,000 BRP when the BRP/USD rate was 0.56. A month later, the exchange rate grew to 0.58. This means a profit of $350 in less than a month time.

Online Forex Trading Profits

Another example of an online Forex trade: If you buy EUR/USD, this means you are buying euros, and simultaneously are selling dollars. Your expectation therefore is that the euro will appreciate (go up) relative to the US dollar.

If you believe that the US economy will weaken and this will hurt the US dollar, you would execute a buy EUR/USD order. By doing so you will buy euros in the expectation that the currency will appreciate against the US dollar. If you believe that the US economy is strong and the euro will weaken against the US dollar you would execute a sell EUR/USD order. By doing so you have sold euros in the expectation that they will depreciate against the US dollar. More information concerning online Forex trading is available at Forex Floor.

Brat Milman - Managing Editor

The Forex Trading Bid & Ask Prices and Spread

This page covers everything you need to know about the bid and ask prices in the online Forex trading market, From the definition of Forex bid & ask prices, to the use of the bid & ask spread.

A Forex Trading Bid price is the price at which the market is prepared to buy a specific currency pair in the Forex trading market. This is the price that the trader of Forex buys his base currency in. In the quote, the Forex bid price appears to the left of the currency quote. For example, If the EUR/USD pair is 1.2342/47, then the bid price is 1.2342. Meaning you can sell the EUR for 1.2342 USD.

A Forex asking price is the price at which the market is ready to sell a certain Forex Trading currency pair in the online Forex market. This is the price that the trader buys in. It appears to the right of the Forex quote. For example, in the same EUR/USD pair of 1.2342/47, the ask price us 1.2347. This means you can buy one EUR for 1.2347 USD.

The Forex bid & ask spread represents the difference between the purchase and the sale rates. This signifies the expected profit of the online Forex Trading transaction. The value of Bid/Ask Spread is set by the liquidity of a stock. If the stock is highly liquid, it means many stock units are being bought and sold, and the Forex bid/ask spread will be lower. Traders prefer foreign currency with a lower bid/ask spread, because it means their money pair only for the currency and is not wasted on the bid/ask spread difference. A lower Forex bid/ask spread allows the trader to cut down on his losses.

Jim Barns, Market Analyst

How to Use Forex Trading Limit and Stop Orders

In this section we will explain about the different limit order and stop orders that are available and are used for Forex trading strategies. Limit and stop orders have a similarity to support and resistance levels, as they are also usually at the far edges of the currency price graph, and are set either to reap profits or prevent losses.

Limit orders

Forex Trading Limit entry orders are executed only if the currency price touches but not breaks the price you set. Limit orders are done when traders want to set the limit price. These orders are executed only if the currency reaches the limit price you set. Limit orders are used when you want to buy and sell a currency only if it reaches a certain price or better. Let's say the currency pair EUR/USD is worth 1.245, and you buy a limit order of 1.249. This means that the transaction will be executed only if the currency price rises to 1.249.

Stop orders

A stop order is placed to accumulate profits or to prevent losses. To place a stop order, simply specify the price where you'd like to place the stop on. Stop orders are sometimes names stop loss orders, and can occur for both bid and ask transactions.

A stop loss order is a type of Forex Trading limit order that serves as a protection against a large drop in currency price. If the currency price falls beneath the price you set, it is automatically sold, thus ensuring you do not lose too much money.

Take profit orders are limit orders that are set to help investors reap currency price raises. Let's say you buy the EUR/USD for 1.245, and you want to place a stop on 1.240. This means that if, after you buy it, the currency drops to 1.240 or below, your currency will automatically be sold off, and you will prevent any further losses from occurring.

Trailing stop orders

Forex Trading Trailing stop orders are used to lock in profits. Let's say you buy GBP/USD for 1.6540, and the price rises to 1.6570, making you a profit of 30 pips. Now a new stop order is placed at 1.6560, so you lock in the previous rise. When you place a trailing stop you specify the positions of the trailing points, and the increase in the stop will be done automatically.

Tania Raven, Market Analyst

How to Handle Forex Trading Losses

A smart online Forex trading investor should keep a close record of his trading losses. This is to make sure that the currency doesn’t drop, are updated with its development, and that you have the option to settle trading losses if you start to lose.

To start writing records, first acquire a notebook for the sole propose of online Forex trading record keeping. In this notebook you should write a chart with the following titles:

The trading date

The Beginning balance

The number of trades

The pairs traded

The strategies used

The ending balance

Forex Trading losses

In the lines underneath these columns you need to write the dates in which you do your online Forex trading.

Mistakes to Avoid While Forex Trading

Always Trade with a Stop-Loss Limit Order

The most important thing for an experienced trader is to secure his investments and prevent large Forex trading losses. The option of the stop loss will give you that extra protection that is vital for any investor. In Online Forex trading, the investor online is the one calling the shots, so don't be afraid of using this option to secure your account.

Always Trade with a Take-Profit Limit Order

For the same reasons previously stated, the sound investor should always set a reasonable take-profit limit order. If the currency will rise, you can advance and raise your investment without risking the money you have.

Do not Trade Too Many Pairs All At Once

It is hard to follow up with many Forex trading currencies all at once. This is because for each trade you will have at least three charts, making it hard for you to keep track of your investment. There is also a larger probability that one of your Forex trading currencies drops, something that can endanger all your investments. Focusing on a few pairs will cut down, for the long run, on your trading losses.

Do Not Trade Minor Forex Currencies

Trading minor currencies are more risky, and there is more chance of trading losses. It is not advised to trade in the minors because it fluctuates more risking you funds. This is recommended because most online Forex trading is done for major currencies.

Trade with a Plan

Before starting Forex trading, review several charts that will give you more information about the currencies you want to trade in. These include the 5-second, 1 hour, and 1-day charts. Technical analysisand fundamental analysis can also help your trade. When you analyze the charts, try and find out what is the long term direction of the Forex currency fluctuation.

Cut Your Trading Losses Down

Sometimes it happens that a currency you invest in drops. If you notice a trend early on you are better to cut your trading losses and not continue losing more money. This is because of sunk cost- money that you have lost is better to be left and not counted upon.

Jim Barns, Market Analyst

Forex Trading Trend Patterns - The Double Top

A double top is a type of Forex trading reversal patterns. A double top is recognized like so:

- First you see a long rise in currency price.

- This rise is followed by a top and a small drop, and a bottom.

- Then another small rise appears.

- The double top Forex trading pattern is complete when another top is formed and the currency starts to drop again.

The last drop of the reversal pattern is a long one, and it indicates the trader to either liquidate the currency he already has, or perform a sell order for the bid price.

The quick recognition of this 'M' shaped trend pattern can help your investment, and can justify the saying 'forex trading made easy'.

Double tops usually don’t appear as perfect 'M's, but over time these trend patterns are easily recognized as the more basic Forex trading trends are.

Tania Raven, Market Analyst

Forex Trading Trend Patterns - The Double Bottom

The double bottom Forex trading trend pattern is similar to theDouble top, only the other way around. Trading Forex should involve a constant search in chart for patterns similar to the double bottom, and can be recognized through the following details:

- You first see a long drop in currency price.

- This is followed by a short rise, and the first bottom.

- Next comes the short rise, and a top.

- Finally comes the second bottom, followed by a long expected rise.

The double bottom Forex trading trend pattern can be recognized easily by noticing the 'W' shape. The trader needs to initiate the buying of the ask price right when he notices the final long rise.

Jack Dempsky, Consultant

Sideways Forex Trading Trend Strategy - Waiting for a Turn

As mentioned in our Forex trading trend guide, sideways trend lines are seen as horizontal lines, that occur in between drops and rises in currency price.

Forex trading sideways trends are a good entry point for investors, because they are stable places where the currency price behaves steadily, on a relative perspective of course.

Sideways trend lines cannot continue for a long time, and it is a good advice to try and estimate where exactly the currency is going to go next. Following this Forex trading courses can help you pin point when a sideways trend is going on and invest more wisely.

A Forex trading sideways trend can nevertheless last for days and weeks. This period of time is considered congestion, and after this period of congestion there usually occurs a rapid rise or drop in the currency price. Another thing you should know is that the direction that a currency price continues after a Forex trading sideway trend is usually the original direction that presided before the sideways trend took place.

Using the right sideways trend strategy means figuring out the following direction of the trend by seeing the previous market direction history.

Forex trading trend line the currency price still fluctuates, but with rather small ups and downs. A sideways trend is said to be broken when the currency price goes outside the previous limitations of the trend line. You might like to make sure that the price goes outside the barrier of the trend line twice before being sure the sideways trend is broken.

Tracy Jones, Forex Senior Editor

Forex Trading Downtrend Strategy - Selling at the Top

When new investors view downtrends, they often avoid placing transaction, because they do not understand that the Forex trading market can be profited from in both ways - through buying and through selling.

In order to use Forex trading downtrend strategy, first glance at the hourly chart and try to figure out what the big picture is concerning the currency. Take special notice of support and resistance levelsthat will be a good guide to invest within. Also glance on the 15 minute chart and compare the Forex trading downtrends of this chart with the hourly chart.

Ask yourself this - Is the current trend a Forex trading downtrend? If so, is it a substantial one? What are the odds the currency price will continue in this direction, and for how long? You do not have to have exact answers to these questions, only assumptions based on the knowledge you'll attain over time. Using this Forex trading downtrend strategy, you will eventually be able to use Forex trading for a living.

Other techniques include :

Using the moving averages indicator, and comparing the current price with 60 other price examples. The current price should be lower than the moving average, and this indicator should point to a downtrend.

Comparing the current price with the previous highs and lows of the currency.

Noticing the levels of tops and bottoms over the last week.

If the previous information point to a Forex trading downtrend, then you should go ahead and sell the currency pair. If the results are ambiguous, stay updated and continue to keep track of changes in the currency that can point to a good timing for entry.

Tracy Jones, Forex Senior Editor

Forex Trading Uptrend Strategy - Buying for Low Prices

So you've recognized an uptrend, what then? How can you use your knowledge in order to invest in the Forex trading currency more wisely? In this guide we will teach you the Forex trading guidelines for uptrend strategy.

It is actually not very difficult to invest using uptrend. We will make it easier for you and dissect it into segments.

Uptrend are very useful for technical analysis, because they help you know when to buy a certain currency that is on the rise.

- First, make sure you are certain about the occurrence of the uptrend, and remember that the steeper the uptrend is the more profits are there, but also the sooner it is expected to change direction.

- Next, examine the previous developments of the Forex trading trends, and especially notice the length of previous uptrends. A common phenomenon is for recurring lengths of uptrends.

- Do not wait for the uptrend to finish rising, and try to invest in just starting trends. Placing stop and limit orders can help you be protected in cases of currency drops.

Using uptrend strategy is a basic in forex trading education, and the rest of the rules for uptrend will be gathered as you practice the real thing.

Jim Barns, Market Analyst

What is a Limit Order and What Are Its Advantages?

A Limit order is a type of order that positions the maximum or minimum at which you are agreeable to buy or sell a specific stock. Stocks are a matter of pure chance in common cases. Unavoidable events such as weather disturbances and wars can ruin chaos on share prices of stocks. It is better to set limits on your activity so you would not be burned out. Whether you want to buy or sell your own stocks, you must be contingent on at least one other person or entity to eventually perform the transaction.

This person will act as your own and you have to tell this person your desire to buy or sell at a certain price. You have to decide your chosen price that you are willing to settle for this transaction, and then this agent will tell you what that price would be. This is what we may call a limit order.

In order to avoid buying or selling a stock into a higher or lower price that what you wanted, you have to place a limit order rather than a market order. This limit order could give you a chance to buy or sell a security at a particular price. You may carry out a buy of a forex limit order at the time of limit price or lower, while you may execute a sell of this type of order at the limit price or higher. When you place a market order, you won’t be able to control the price at which your order will be filled.

The primary advantage of this currency trading limit order is that it guarantees that the trade will be carried out at a specific price, on the other hand, your broker agent might charge you with a higher commission for this order and it is potential that your order will be executed once the limit price is not attained. This allows you to have the advantage of determining the price.

Limit order is a safeguard against momentous loss of money. It is not certain to take effect, on the other hand. The share price may never reach your limit order level, if that happens, then this type of order has not been filled and it either stays in effect or is cancelled after a certain or definite amount of time. An investor with a long position can set a limit order at a price higher than the current market price to gain profit while investors with short position may set this type of order below the current or present price as the initial target to manage risks along the way.

Always remember that there are no rules that regulate investors from using different types of orders to manage their positions. Each order has different risk tolerance and it is always a personal decision of an investor what order should be applied.

How Is Stop Limit Order Done?

A Stop Limit order is same as stop order wherein a stop price will trigger the order. Such an order will be placed by a broker that merged the features of both the stop order and those of a limit order. This is a combination of both a stop order and a limit order. Once this is activated, the stop limit order becomes a buy limit or a sell limit order and can be carried out at a particular price or a better one. This will be executed after a stop price has been reached, and once reached, it becomes a limit order to buy (or sell) at the limit price or for a better one. As with all limit orders, a stop limit order could not be filled unless the security price reaches the specified stop price.The benefit of this type of order is that it allows the traders to control over when is the best time order should be filled. Investors can manipulate the price at which the trade will be implemented. Of course, like all limit orders, the trade will be filled or guaranteed unless the stock’s price or commodity never reaches the specified stop or limit price. Mostly, this incident happens in fast moving markets since prices tend to vary or fluctuates outrageously.Since this type of order can help you in the possibility of getting a lower buy price or a higher sell price than a limit order alone, there are few tips which might be useful for you.1.If you are unfamiliar with the process of using a basic type of limit order, read some articles about how to issue a limit order, for you to have an overview about it.2.Be aware of the difference of using a stop limit order from a limit order. As a substitute of having one price point, you must need to set two. The initial one will be a “trigger” point that will stimulate your order. The second will represent the price at which you intend to actually buy or sell the stock.3.Decide what you desire to have with this type of order. You may use one to sell your stock at a particular price point after it tapped above your trigger point. As well, you can use one to purchase a stock at a particular price after it moved below your trigger point. This can be helpful if the stocks you are selling heads up and keep moving or the one you intend to buy drops down and keep falling. On the other hand, just like the basic limit order, there is no assurance that you will achieve the price you set; your stock could either hit the trigger or have the reverse direction. As much as possible, keep in mind that the further apart your trigger and target prices are, the less you will be able to achieve both objectives in one day.

What is a Transaction Cost and How to Calculate Them?

In economics, transaction costs are the rate acquired when making an economic exchange. This costs incurred when buying or selling securities or stocks. This is also referred as transaction fees.

Transaction costs also comprise of brokers’ commissions ad spreads (difference between the price that the dealer paid for a security and the price it may be sold. This is what the broker or bank produce for being a middleman in a transaction.

For instance, most people when buying or selling a security or stock, pays a commission to their broker and that commission can be considered as the fee or transaction cost for doing that stock deal. When evaluating a potential transaction, it is crucial to think about these costs that might prove significant. Mostly, in financial markets, the initial cost for these transactions is commission which is paid to brokers upon trade execution. This costs becomes increasingly important the shorter the holding time of an investment.

Many market models disregard transactional costs, presumptuous instead those markets are non resistant. While this thought is invalid, for many applications such costs are low enough that they can be disregarded. The lesser the cost for a transaction, the more effective and competent a market is said to be. The Foreign exchange market and stock market have lower costs for such transactions of any major asset class.

It is considered to be much more cost- efficient to trade in Forex in terms of both commissions and transaction fees. An online website for example charges no fees or commissions and at the same time offer traders an access to all relevant market information and trading tools. On the contrary, online stock trade commission ranges from $7.95 - $ 29.95 per trade and up to $100 or more per trade with full service brokers.

Another thing to consider, which is an important point is the width of the bid / ask spread. Regardless of the deal size, foreign exchange dealing spreads are normally or common in 3-4 pips (anyway a pip is .0001 US cents) in the major currencies. Generally, the width of the spread in a foreign exchange market transaction is less than one tenth (1/10) that of a stock transaction, which could contain a .125 or one eight (1/8) wide spread.

Since transaction costs are paid via bid/ask spread, there has to be no charges to trade or hidden fees. There are instances that there would be extra charges asked by good brokers for some non compulsory services or access to particular reports. A smaller spread is visibly better. Since brokers are taking the other side of all the customer trades, brokers gain profit by making the spread between the bid and offer prices. You may find that find spreads vary by broker.

In order to be successful in trading on the foreign exchange market, you have to find a good broker.

How to Utilize a Forex Trading Margin Account

Online forex trading on the margin means you can buy a large sum of foreign currency with actually paying only for a fraction of the investment. This means you pay much less for the currency you buy, by leveraging your initial investment. All of the online Forex trading is done one the margin, and the next example will make it clearer.

For example, If you have $1,000 in a margin account that has a leverage ratio of 1:100, it means you can potentially buy foreign currencies worth up to $100,000, because you place the $1,000 just as a deposit for the leveraged currency.

The major advantage of using a margin trading account is that with margin trading you can increase your buying power and have bigger profits. This is one of the biggest advantages of the online Forex trading.

Avoiding Risks in Margin Trading

-With a Margin Forex trading account, you increase your losses, as well as your profits. So if a currency drops, even by one pip, you are essentially losing 100 times the drop.

-If you invest in a margin account, a drop in the currency can liquidate your account and also leave you owing money. This is why it is important to check and make sure you are also covered in cases of losses.

-Stop losses are one of the tools you can use to ensure your account doesn't drop and is not lost.

-Investing in the margin also needs to take into account how stable the currency is. If the online Forex trading currency is dynamic and has a high rate of fluctuations, a smaller leverage is recommended. To check if the currency is stable you can use technical analysis to examine the different options.

Every time you perform a new trade, part of the account balance in the margin account is put aside as the initial margin requirement of the trade. Before you invest, you should calculate the amount used as the margin requirement. To calculate this, multiply: the current currency price*the units traded*times the margin percent/100. If the requirement is larger do not invest in that currency.

Make sure you invest wisely and read the terms and conditions of the margin Forex trading account thoroughly before the investment.

Paul Gatton, Technical Writer

Major Currencies and Major Participants of the Forex Trading Market

In the Forex trading market, you have several currencies to choose from. Most Forex trading deals are done using the major currencies. These are the seven most frequently traded currencies.

The major currencies include:

USD – United States Dollar
EUR – The European union Euro
JPY – The Japanese Yen
GBP – The UK Pound
CHF – The Swiss Franc
CAD – The Canadian Dollar
AUD – The Australian Dollar

All currencies other than the major currencies are called minors

Trading these major currencies are banks, companies, investment firms, hedge funds and Forex trading brokers.

Banks do a lot of the trading themselves. These include trades that are done for the bank's clients and ones that are done for the bank itself. Banks can trade huge amounts of major currencies, depending on the size and funding of the bank.

Central bank can influence and change the Forex trading market by increasing interest rates, for example, or manipulating with other economic factors.

Companies are also important contenders in the Forex trading market, trading goods and services between countries and nations. With some of the deals made of large companies, the Forex trading market is liable for rapid change and fluctuation. This is why it is important to stay updated with economic factors.

The behavior of companies in the Forex trading market is analyzed through fundamental analysis, so changes can be predicted.

The private investors, trading major currencies from all around the world, consist of only a small portion of Forex traders. Nonetheless, these traders can take an active part in the Forex trading market whenever they want to, and in doing so join other banks and large companies. Using margin Forex trading also allows you to participate in Forex trading of major currencies for larger sums of cash.

Forex Trading Moving Averages

Forex Trading Moving Averages is a technical analysis indicator that lets you see the average value of a currency over a period of time. In order to calculate moving averages for the past 20 days you add the last 20 currency prices and divide the addition by 20. Because days continue to advance, the sum you'll get through Forex trading will change on a daily basis, and this is why it is called moving averages.

The most commonly used Forex trading moving averages timeframes are 20, 30, 50, 100 and 200 days. Each timeframe can give you a different view and perspective on the future of the currency, and this is why all of these figures are used periodically. Using these different timeframes you can increase your profits and also protect you lots from unnecessary losses, so use it wisely, and frequently.

If the Forex trading timeframe is shorter, price changes will affect it more. If the timeframe is longer, the moving average will be smoother and less sporadic. Moving averages are used in order to recognize a certain trend the Forex trading currency is following, and also to view a clearer and straighter graph, without any added "noise".

Forex trading moving averages are the most popular indicator to be used for various Forex trading strategies and technical analysis.

Forex Trading Support and Resistance Levels

In this Forex trading guide we will try to describe in detail exactly what support and resistance means in the following Forex trading lesson. Support and resistance levels are important indicators that can be used to set stop loss and take profit orders using technical analysis.

Support levels are the places where the price of the currency is expected to rise. This happens when there is enough demand for the currency in order to stop the downtrend and therefore causes it to go up.

In order to recognize support levels in Forex trading, take a look at the Forex chart, and try to find a few lows that fluctuate in a horizontal line. This line will be set as the session's support level.If a support level is penetrated, and the currency drops below it, then it becomes a resistance level. This is caused when the currency reaches the support level again most traders will sell their currency and cause it to go down again.

Forex trading Resistance levels are also horizontal lines that appear on the upper side of the chart. Resistance levels are used to set the upper level of Forex trading, when supply levels surpass demand for the currency. After a resistance level is broken there is usually a change in the bid/ask price of the currency, and sometimes leaps upwards.

Hopefully, this Forex trading guide will help you make the right decisions in investments, and help you understand this concept of suport and resistance.

Introduction to Technical Analysis

Any forex trader must apply a certain method in order to predict the future price of a certain currency, that's a given fact. The entire concept of speculative forex trading is based upon future fluctuations in currency prices. You make profit by buying a certain currency in one price and selling by another.Therefore, the most important thing for any trader, novice or expert, is to have some sort of prediction to future price changes. Thus came to life several different methods of market analysis, each tries to incorporate different methods and data in order to give some sort of prediction to the future price of various currencies.

The first method we will review in this series of articles is Technical Analysis. Technical analysis is based on the concept that it is possible to predict future prices using only market generated data. All the data and history regarding a price is represented in various charts and imply assorted methodologies. Every trader, no matter what trading style he uses, uses this method at some point. At the very least, these charts help to determine what the ideal buy or sell position is, at any given time. It helps to give a broader look on he trends and patterns in the market.

Many critics accuse the Technicians of ignoring the fundamentals of the market, but they claim in return that all of the market's fundamentals are already represented in the charts. In their opinion any fundamental market rule is already enveloped in the current price and more importantly in the price's history.

Forex trading can be easy using the right reading materials and tools. Follow our latest articles and download our software here at Forex Floor.

Forex Brokers – Forex Trading Account and How to Start Forex Trading

Forex brokers don’t make money on each trade so you get unlimited trades with just about any forex broker. There are many brokers out there but they offer outrageous fees and other terms that you must agree to and are just not worth mentioning. Forex brokers necessarily tell you what the minimum to invest. In some cases, you can invest capital, with the entire $ 5 for the opening of trading account and to start Forex trading. Forex brokers can be compared on the basis of the spread they charge. Most brokers publish live or delayed prices on their websites with their profits calculated in the price.

Forex brokers usually offer many different trading platforms for their clients. These platforms often include real-time charts, technical analysis tools, real-time news and other data. Forex brokers commonly lean the prices. Forex brokers offer a lot of amazing services that investors can really take advantage of. They sustain strong spreads on the major currencies competing against the dollar.

Forex brokers are usually compensated through the bid-ask spread of a currency pair. For example, a retail forex broker may buy euros for 1.5475 U.S. Forex brokers necessary if you are going to trade currency. There are those who are qualified to do this without outside help, but for the average trader, attempting to trade on the Forex market without a broker it is like trying to hunt a dinosaur with a water gun. Forex brokers are the typical go-between in the forex market. Without this agent you will have a hard time dealing with the changes in the forex market.

Traders looking to protect their existing long USDCHF position or enter long at a favorable price may consider a hedge short USDCHF below 1.0490 with a target at 1.0290. Once the profit target is hit, we expect the bullish trend to resume. Trade without emotion – Don’t keep “mental” stop-loss points if you don’t have the ability to execute them on time. Always set your stop-loss and take-profit points to execute automatically, and don’t change them unless absolutely necessary. Trade with the trend in order to maximize your chances of success. Trading against the trend will not “kill” a trader, but will surely demand more attention, nerves and sharp skills to reach the trading goals you have set

Consumer Spending Forex Trading Indicators

This Forex trading economic indicator is published by the Bureau of labor statistics in the U.S. Department of Labor, every 13th of a month. The economic index is relevant for the passing month, and measures the price of a fixed basket of goods and services that is bought by consumers. This is the most used measure of inflation, an important tool for the Forex trading market.

It is important to state that this Forex economic indicator does not measure technological commodities which change in price, and this is something the CPI has been criticized for.

When you use the CPI to measure Forex trading price changes, you should always remember to take into consideration the movements in the food and energy prices, because they can change and rise or drop regardless of the Forex currency or the inflation levels.

The CPI is also monitored on it's yearly Forex Trading indicator that tells a great deal on the condition of the Forex inflation levels of a currency.

Consumer Credit Forex Indicator

The consumer credit index is published by the federal reserve every fifth business day of the month. This Forex trading measure is used to evaluate consumer spending. This measure is liable to make considerable changes and fluctuations in its value.

Consumer credit consists of three categories: auto, revolving and other. All in all this indicator is less important than the CPI, but it can also help you gain an understanding of the online Forex trading market.

Forex Employment Indicators

In this page we cover the most important employment indicators for the online Forex market, including the ECI, the household survey and the establishment survey. Employment indicators are importanteconomic indicators, and are used often for fundamental analysis of the online Forex trading market.

The Employment Cost Index (ECI)

The ECI is an important Forex employment indicator, and is published in a quarterly report from the U.S. Department of Labor. It measures the growth of employees' compensation, and this includes the wages and benefits that employees get.

The information in the survey is based on a report that is held at the end of the month every quarter.

The information that is tracked by the ECI is the wages movements, the fringe benefits and the bonuses that are given to employees at various levels of the organizations.

The report is used to foresee the online Forex trading currencies price movements. As employees increase the pressure for wage raises, this raises inflation levels, as consumer prices move up in their prices. The inflation is assumed to go up if the ECI increases. This in turn lowers the online Forex currency price.

The ECI is a Forex employment indicator that measures the number of jobs in more than 500 industries that cover 50 states and 255 metropolitan areas.

The Employment Report

This report contains two employment reports inside: the household survey and the establishment survey.

The household survey is an employment indicator concerned with households, and is smaller, covering only 50,000 households.

the establishment is about businesses, is more comprehensive and thus it is preferred by analysts of the online Forex market. It covers 400,000 businesses with 47 million people.

The Establishment Survey

Non-farm Payrolls - This is a very important employment indicator for the establishment report, and has crucial importance for online Forex trading. it measures how many people are there on payrolls for non-agricultural businesses.

Average Workweek - This measures the average hours worked non-farm payroll employees, and is a fine judge of the overall strength of the employment report.

Aggregate Hours Worked - This index combines the two previous indexes together.

Average Hourly Earnings - This employment indicator gives us a good idea of the personal income growth during the month, and is especially critical in times of strong economic growth, as an evidence of increasing wage pressures, which can influence the online Forex trading market considerably.

The Household Survey

The Unemployment Rate - This index is calculated through the division of the number of people unemployed by the number of people in the labor force.

There are other employment indicators in the employment report but these are the relevant ones for the online Forex trading market.

Forex Trading Inflation indicators and Interest Rates

Forex inflation indicators are used very commonly when traders analyze the Forex market. The inflation effects the interest rates, which in turn can effect the currency markets.

In order to fight inflation, interest rates are raised, and thus the country's currency is strengthened in relation to other currencies. In this way, in the short term, If inflation rises, the currency also rises in value.

On the other hand, if interest rates go higher, then investors withdraw from their investment in the country, and the currency weakens. Thus, in the long run. If inflation rises, the currency will eventually drop in value.

As a counter measure of rising inflation indicators, interest rates rise usually after meeting of BOE (Bank of England), FED (US Federal Reserve), ECB (European Central Bank), BOJ (Bank of Japan) and other central banks.

In order to measure inflation traders use different economic indicators.

Economic Indicators that Influence Inflation Indicators

Gross Domestic Product (GDP) – This measures the total market value of all goods and services that companies make within the country. This is an indicator of the growth pace of a country, and can tell the trader much about the prospect of inflation indicators.

Producer Price Index (PPI) - This measures price changes in manufacturing. It measures the changes in selling prices for the various manufacturers. The prices of manufacturing are at a close link with inflation indicators, and thus can help predict the online Forex trading direction.

Consumer Price Index (CPI) - This measures the average price that consumer pay for a fixed basket of goods and services. When the inflation indicators point to a rising inflation level, goods' prices also rise, and this can be viewed through the CPI.

These measures have been used throughout forex history to evaluate the market and make hard decisions about investments. They should also be used by you when you make fundamental analysis.

Forex Economic Indicators

The execution of fundamental analysis in the Forex market is done through the use of economic indicators. These indicators point to the state of some economical factors in the country whose currency you wish to trade with.

Economic indicators are published by various sections of the government and private companies. These statistics are analyzed by market investors to predict the direction of the Forex trading market. Forex economic indicators are published at fixed time intervals, and are followed by any serious online Forex trader.

Since so many people are tuned to use them, Forex economic indicators have a large impact on prices of currencies of the Forex trading market. Most traders do not use fundamental analysis because economic indicators seem difficult. This however is wrong because following simple guides can help you stay updated with the important Forex economic indicators easily.

Starting to use Forex economic indicators

To get started, you should first keep a log of all the important Forex economic indicators' release dates. Keep a log or make a subscription to one of the economic journals, so you'll know the most important factors of that time. If you are trading in JPY, the Forex economic indicators need to be relevant to the currency type, of course.

Each economic indicator tells you about a different aspect of the economy, and this should be translated in turn into the predicted movement of the currency price. Make sure you understand which aspect the indicator is about. For example, know that the GDP measures the growth of the economy while the PPI measures inflation. Don't worry, with some experience this will come naturally.

Different indicators have changing importance, according to the country's currency. Some currencies might have inflation indicators as key economic indicators while others will have employment rates as key indicators. This is also something you should find out and read about at various books and online guides.

There are leading economic indicators, which change before a particular Forex trend is set, and lagging indicators, that change after the economy had begun to follow a certain pattern. Both indicators should be used, depending on the currency's situation.

Major Forex Economic Indicators

The Gross Domestic Product (GDP) - The sum of goods and services produced by domestic or foreign companies.

Industrial Production - A measure of the production change, industrial capacity and resources of a country's factories, mines and utilities.

Purchasing Managers Index (PMI) - A monthly index of a country's manufacturing conditions, including new orders, supplier delivery times, inventories, prices, employment, export orders, and import orders.

Producer Price Index (PPI) - A measure of price changes in the manufacturing sector.

Consumer Price Index (CPI) - A measure of the average price level paid by urban consumers for a fixed basket of goods and services.

Employment Cost Index (ECI) - A measure of the number of jobs in more than 500 industries in all states and 255 metropolitan areas.

Fundamental Analysis Vs Technical Analysis in the Forex Trading Market

The main difference between fundamental vs technical analysis of the Forex trading market is that, while fundamental analysis uses economic, political, social and other factors that affect supply and demand of the trading Forex market to foresee price movements, technical analysis uses mathematical and graphical charts of previous market action, in order to analyze the Forex trading market.

The basic difference between Forex fundamental and technical analysis is therefore that:

- Forex Fundamental analysis uses various factors that influence supply and demand to predict the currency change.

- Technical analysis uses charts of previous currency change to predict the currency change.

Cause and Effect of Market Price - Forex Fundamental analysis looks at causes of currency change.

Forex Technical analysis looks at effects. Fundamental analysis causes, such as government policy, can later be seen in the technical analysis charts that constitutes the effects of the certain policy.

Types of Analysts - Fundamental investors would research a currency from top to bottom, looking at interest rates, balance of trade, the gross domestic product, unemployment and other economic factors, in order to see if a certain currency is about to rise or drop in value. Technical investors, on the other hand, would look at the price action of the Forex trading market, and view chart details such as open, high, low, close, volume and open interest for the currency price of a certain time to notice changes in the currency. This is why fundamental analysis is more suited for long term Forex forecasting, while technical analysis foresees short term changes in the Forex trading market.

Combination analysis - The most recommended method of Forex trading is to use both fundamental and technical analysis together. This way, you can study fundamental analysis of a currency, and find out what are its economic factors and what is its future direction. After this you turn into technical analysis, and study those currencies charts, trying to see the right timing to step in, and buy/sell the certain currency.

After using both types of analysis you can be sure you are covered both ways, and you can now turn to invest in Forex trading, with the confidence that you know what currency to trade with, and when to trade as well.

Understanding and Trading Forex Currency Pairs

Any Forex trading transaction is made of the buying of one currency and the simultaneous selling of another currency. The two Forex trading currencies being traded are called the currency pair. A currency quote is made of these two pairs of Forex trading currencies, situated together and divided by a line (for example, EUR/USD).

There are various Forex currency pairs to choose from. These are divided into major and minor currencies. Major currencies are the seven most frequently traded currencies, which include the USD, EUR, JPY, GBP, CHF, CAD and AUD. All other currencies are called minor currencies, and include the NZD (the New Zealand dollar) and the ZAR (the South African rand).

Cross currencies are types of Forex trading currency pairs that both do not consist of the USD. For example; the pair CHF/JPY, worth 84.50 which would mean that one Swiss franc is equal to 84.50 Japanese yen. Sometimes not all of the currencies are available for you to buy and sell, so you should check this factor out when choosing an online Forex trading site.

The first currency in a pair is called the base currency. In most Forex trading options this is the USD. The main exceptions for this are the EUR, GBP and the AUD currencies, which appear before the USD in a quote. The base currency will also appear before the quote currency when you use technical analysis with charts of different sorts.

The second currency in a currency pair is called the quote currency. This currency shows your profits and losses for the Forex trading transaction.

Following are example of major currency pairs:

EUR/USD – Here the base currency is the EUR, and the quote is the USD.

USD/JPY

GBP/USD

USD/CHF

EUR/CHF – This is an example of a cross currency.

AUD/USD

USD/CAD

NZD/USD

EUR/GBP

EUR/JPY

BP/JPY

CHF/JPY

GBP/CHF

EUR/AUD

Forex Vs Equities

Any novice Forex trader questions himself sooner or later – "Why did I choose the Forex market, is it definitely the best financial market for me?" Usually this question arises from curiosity and nothing else, but curiosity must be satisfied.

In the next two articles our team will point the evident advantages the Forex market has over other well-known financial markets, starting with the famous US equities market. Any person with a feel for economics and trading experiences some sensation to the sound of Wall Street, but does it truly measure up to the colossal forex market?

First, the key benefit the forex market offers is its 24-hour accessibility. When you are trading forex it doesn’t matter at all whether it is 5am or 5pm. Time differences and market dynamics make sure there will always be an eager trader somewhere around the globe looking for a deal. This feature gives you the privilege to respond to any financial developments, as soon as they transpire. Furthermore, the prices of forex can not be affected from after-hours trade.

An additional key aspect of the forex market is its unmatched liquidity. This legendary liquidity is derived from the market's immense size, more than 50 times larger than the total trade in the US stock exchange. None the less, it's seemingly impossible size, which sometimes creates certain repulsion, and its liquidity creates stability like in no other market. The forex market is one of the most solid financial markets throughout the modern financial history.

Online forex has many advantages that the equities market can't even dream of. The leveraging that online forex brokers present is significantly better than any possible offer you can find on the equities market. The margin that the online forex firhttp://www.forexfloor.com/fx-equities.htmlms can offer is extremely larger than the standard 2:1 you'll get from your equity broker. The margin you get while trading forex can go even up to 100:1, and in some cases even 200:1. You are welcome to learn more about margin and leveraging in our "Margin trading overview.

Read more about the advantages in the next article that will compare the forex market to the equities market.

Forex Vs Currency Futures

If you have read our article comparing forex to equities you probably already know why Forex is a superior market in measuring up to the equities market. In this article we will evaluate the Forex market in conjunction with the currency futures market. Of course there are various points of distinction between each of these markets – historical, philosophical and technical to name a few. In this article we will review some significant differences between the two markets that reflect the way you trade and make money in each of them.

One of the biggest advantages the Forex market has to offer is its unparalleled volume. In fact, the amount of money traded every day on the Forex market is over 50 times bigger than the volume on the futures market. If you have read our previous Forex trading articles you probably already know that the Forex market is the biggest financial market in the world. Fact is that this size does not only indicate the popularity of the market but most of all it shows the amount of trading opportunities you can find on this market. The Forex market offers a place for any trader, from the smallest pastime traders to the professional, high-rollers.

Margin accounts and leveraging in the Forex market is quite different from the currency futures market. Currency futures brokers give different margin and take different commissions for 'day trade' and 'overnight' positions. Also, the margin rates that the futures brokers give usually depend on the size of the deal. On the other hand, Forex brokers offer the same leverage and the same margin rates at all times, day or night and with no concern to the size of the trade.

The learning curve of a new trader in the Forex market is not as steep as the one in the futures market. The methodology and quotes used in the Forex market are very easily understood and are quite intuitive, even to new traders. The futures market on the other hand is completely different. The price quotes of currency futures are inversions of regular prices that are used only in this market.

Furthermore, the futures market demands many complicated adjustments. To name a few, the futures prices include time factors, interest rates and discrepancies between interest rates of different currencies. This turns the futures market into a much less intuitive and friendly market.In summary, the Forex market has many significant advantages over the currency futures market that turn it into the natural choice for any entrepreneur or smart investor.

Why Forex Trading

If you want to know why the Forex trading market is superiors to other investor options such as Equities or the futures market, then you can rest assure that you'll find the answer in this page.The best way to clarify the advantages of the Forex market is through a real example. In 1929, the stock market collapsed, causing many people and businesses from around the world to go broke. This also happened when the high tech bubble burst. The fear of a market crash is a concern that constantly dwells in the minds of investors, both professional and beginner ones.

In the online Forex trading market, There is no way for the market to crash. If you have read about what is the Forex trading market, then you know that when you buy a certain currency, you are at the same time selling another currency. When some currencies' price false, others' price rise.

So this is the most important advantage of Forex day trading. Unlike other markets, where in some cases all traders lose money, with Forex trading there are always traders that make a profit, at any given time.

Here are some other advantages of the Forex trading market:

No commissions. Only in the Forex trading market are there no government fees, brokerage commissions, exchange fees and other unnecessary losses of cash. There are also low transaction costs between the bid and ask price.

No middlemen. In this market there are no investors that take a percentage of the investment or the profit, and you transact directly with the pricing market agent.

You can choose the size of your investment. The Forex trading lot is dynamic, and is set according to your preference. This lot can vary between large lots worth $10,000 to mini lots worth $25.

High liquidity. In the Forex trading market you can buy and sell your currency at any time and place, regardless of the currency position, when the trade itself is done almost instantaneously.

Trading in the margin. Forex trading consists of margin investmentsthat increase your chances for higher profits by increasing your money's worth.

Opened 24 hours a day. Because it's worldwide and operates in several time zones, the Forex trading market is the only market that you can trade in 24 hours a day.

With all of these wonderful advantages, there is no wonder more and more investors choose Forex trading as there main fund for investment. Because all transactions can be done online, you don't even have to leave your house!

Forex trading History Explained

The modern online Forex history begins in 1973. Even thoughcurrency trading has been around since the times of ancient Egypt, which at that time the market was extremely primitive, and there were no advance trading tools as today's fundamental analysis, for example.

The first currency coins were used at the times of the pharos, and the first paper notes were then introduced by the Babylonians. Later on, the roman coin called aureus was used, which was followed by the denarius. Both coins had worldwide use, making them the first global foreign currency coins.The Bretton Woods System (1944-1973), came after the great instability of World War II. England and other European countries were left in ruins, after the war ended, while the US's economy was left relatively stable and strong.

The USD became the prominent currency after WWII, mainly because of the war. The Dollar also became the new global reserve currency, and remained so throughout the rest of the Forex history. This was agreed upon in the Bretton Woods conference, when all of the other foreign currencies were pegged to the USD, and a new international financial network was formed.

In 1971, the Smithsonian Agreement was signed by ten of the major financial powers, but it's attempt to improve stability to the current Forex history failed.

Free Floating exchange rates came into use when the Bretton Woods agreement ended. This occurred after this international financial system was in operation for three decades in the Forex history.

During 1973, the UK, facing financial problems, floated it's currency. Other currencies began to lose value, and this led the European economies to also float their currencies.

1994 saw the first online currency trading introduced to Forex history. This had a large impact on the development of the Euro currency, and introduced a new major contender to the control of the USD in the Forex history. By 2002 the Euro became the official currency for 12 European nations, and in the past few years more nations have joined this agreement. The modern online forex history offered new options for the online trader, such as the use of margin account to leverage investments, and this is all thanks to the contribution of the internet to the forex history.

Online Forex Trading Introduction

The online Forex market, also known simply as Forex, FX or the foreign exchange market is the biggest trading market in the world, with daily Forex trading that exceed $2 trillion.

Even tough we are talking about a huge market, Forex trading is quite simply - the buying of one currency while at the same time selling of another currency. If the trader can predict correctly which currencies will drop and which will rise - he will benefit from his investment.

There are a lot of benefits in Forex investing over other investment markets.

Why is Online Forex Trading Profitable?

The online Forex market has existed since the early 70's. Only in the past few years though, it has become accessible to millions of people through the development of the internet. Because the Forex market is available 24 hours a day, it's the only market that allows you to trade at your convenient time.

Today, because the economy is much more dynamic than it used to be, and the world has become a global village, economic conditions in various countries are also constantly changing, according to such factors as production rate, inflation and unemployment.

As a result, the rate of a specific currency changes and moves up and down in comparison to other currencies. This is the main reason of the process of rate fluctuations in the online Forex market.

In order to evaluate and predict these Forex market changes a trader can use fundamental analysis or technical analysis as a tool for investment. Where as fundamental analysis is a more broad exploration into the economic factors influencing the online Forex, technical analysis uses charts and other indicators to asses price patterns taht re-occur over time and can help predict the forex market.Foreign Currency exchange rate

Currency exchange rate is the ratio of one currency valued against another. For example, "EUR/USD exchange rate is 1.2505" means that one euro is traded for 1.2505 dollars. If you've already invested in other markets before, you'll find the Forex trading system quite similar, and the transaction to online Forex trading smooth. An example of a Forex trade: During October 2006 you buy 10,000 BRP when the BRP/USD rate was 0.56. A month later, the exchange rate grew to 0.58. This means a profit of $350 in less than a month time.

Online Forex Trading Profits

Another example of an online Forex trade: If you buy EUR/USD, this means you are buying euros, and simultaneously are selling dollars. Your expectation therefore is that the euro will appreciate (go up) relative to the US dollar.

If you believe that the US economy will weaken and this will hurt the US dollar, you would execute a buy EUR/USD order. By doing so you will buy euros in the expectation that the currency will appreciate against the US dollar. If you believe that the US economy is strong and the euro will weaken against the US dollar you would execute a sell EUR/USD order. By doing so you have sold euros in the expectation that they will depreciate against the US dollar. More information concerning online Forex trading is available at Forex Floor.

Active FX Traders

Hours:The dealing desk is continually open between Sunday 5:15 PM New York time and Friday 4:00 PM New York time.Mode of Dealing:Quotations, Order Placement, and Confirmation available over the telephone or via the Internet.

Hours

Mode of Dealing

Bid/Ask Spread

Order Sizes

Types of Orders

Margin

Margin Requirement By Currency Pair

Rollover/Interest Policy

Bid/Ask Spread4-5 pips on the Majors and 5-20 pips on the Crosses: • U.S. Dollar / Japanese Yen (5 pips)• U.S. Dollar / Swiss Franc (7 pips)• U.S. Dollar / Canadian Dollar (5 pips)• Euro / U.S. Dollar (5 pips)• Euro / Great Britain Pound (5 pips)• Euro / Japanese Yen (5 pips)• Euro / Swiss Franc (7 pips)• Euro / Canadian Dollar (10 pips)• Euro / Australian Dollar (20 pips)• Great Britain Pound / U.S. Dollar (5 pips)• Great Britain Pound / Japanese Yen (10 pips)• Great Britain pound / Swiss Franc (15 pips)• Swiss Franc / Japanese Yen (10 pips)• Australian Dollar / U.S. Dollar (5 pips)• Australian Dollar / Canadian Dollar (20 pips)• Australian Dollar / Japanese Yen (10 pips)• New Zealand Dollar / U.S. Dollar (5 pips)Order Sizes:On the GFM trading platform all trades are executed in standard sizes of 10,000 base currency per one lot. There is no maximum trading volume on the GFM Trading Station, however, for trading sizes larger than $10,000,000 traders must request a quote over the telephone.Here are some examples:• U.S. Dollar/ Japanese Yen (10,000 U.S. Dollars)• Euro/ U.S. Dollar (10,000 Euros)• Euro/ Great Britain Pound (10,000 Euros)• Euro/ Japanese Yen (10,000 Euros) Types of Orders:The trading platform provides sophisticated order entry and tracking of market orders, entry orders, stop/limit entry orders, and stop-loss orders. All of the above orders are Good Until Cancelled (GTC), which is valid until the order is executed or cancelled. Click here to learn more about the different types of orders.Margin:GFM enables currency trading to be conducted on a highly leveraged basis. Every trader is able to select the degree of leverage or gearing that the trader wishes to employ in trading. Unless the trader specifies otherwise, GFM sets the leverage level at GFM's most lenient requirement. The requirements for leverage vary with account size, and may be changed from time to time at the sole discretion of the dealing desk, based on volume traded and market conditions.Margin Requirement By Currency Pair:

Currency

Mini Account

EUR Based Currency Pairs(EUR/USD, EUR/GBP, EUR/JPY, EUR/CHF, EUR/CAD, EUR/ AUD)

$130 Per Lot *

GBP Based Currency Pairs(GBP/USD, GBP/JPY, GBP/CHF)

$200 Per Lot**

All Other Currency Pairs(USD/JPY, USD/CHF, USD/CAD, AUD/USD, AUD/CAD, AUD/JPY, NZD/AUD, NZD/USD)

$100 Per Lot**

• In the event that EUR/USD moves above 1.3000, the margin requirement for EUR based currency pairs will be adjusted upward to comply with NFA regulations.• In the event that GBP/USD moves above 1.8000, the margin requirement for GBP based currency pairs will be adjusted upward to comply with NFA regulations.Clients must have approximately 1% of the value of the positions they hold in their account for each lot of currency being traded (approximately 100:1 leverage). This amount does not change after 5:00 PM New York time, which is the rollover cut off, but stays constant at approximately 1% per lot the entire day and overnight. There is also an important safety feature imbedded in this system that prevents clients from losing more money than they have in the account. Once the account equity -- meaning the total floating value of the account -- falls below the margin requirement of approximately 1% per lot, the dealing desk will close all positions. Rollover/Interest Policy:In the spot forex market, trades must be settled in two business days. If a trader sells 10,000 euros on Tuesday, the trader must deliver 10,000 euros on Thursday, unless the position is rolled over. As a service to our traders, GFM automatically rolls over all open positions to the next settlement date at 5:00 PM New York time. Rollover involves exchanging the position being held for a position expiring the following settlement date. The positions being exchanged are usually not valued at the same price. The amount of the difference varies greatly based on the currency pair, the interest rate differential between the two currencies, and fluctuates day to day with the movement of prices. On any given day, the rollover is approximately $1 per lot.At 5:00 PM New York Time, funds are subtracted or added to accounts with open positions because of the automatic rollover. For accounts that have a margin requirement of 2% or more, funds are added to the account for positions in which the client is long (holding) the currency bearing the higher interest rate. Funds are deducted in the opposite circumstance. For accounts that do not have a 2% margin requirement, the rollover amount is deducted from the account for each position regardless of the account's holdings. This 2% margin requirement is the most generous policy available to traders in the forex industry, as many firms require 3-5% minimum margin before traders can benefit from rollover. Note: On Wednesdays, the amount added or subtracted to an account as a result of rolling over a position tends to be around three times the usual amount. This "3-Day" rollover accounts for settlement of trades through the weekend period.

Account Information

To whom should the wire be sent?
Can I send wire transfers in foreign currency?
How long will it take for my wire to appear in my trading account?

To whom should the wire be sent?Wire transfers in USD should be sent to Global Forex Markets.The wire instructions for domestic and international wires are different. In order to expedite receipt of your wire transfer, please use the appropriate wire instructions.for more information Click Here Can I send wire transfers in foreign currency?For USD denominated accounts, GFM accepts funds in multiple currencies. If you send foreign currency to our USD Account, the bank will automatically convert it to US Dollars at an exchange rate specified by them, which will not necessarily be favorable. If you would like to wire funds in euros or Great Britain pounds to fund a USD denominated account, or would like GFM to convert USD to fund a Non-USD denominated account, please contact GFM's operations department at athttp://www.globalforexmarket.com/account-information.htmHow long will it take for my wire to appear in my trading account?Like official checks, wire transfers will be deposited into your trading account upon receipt.

World Currency Market...How you could Make use of it

Basic Tips & ideas on : World Currency Market and it's future in the Forex Trading

Trading takes place in New York, Frankfurt, London, Tokyo and Sydney at all hours. Forex trading or foreign exchange currency trading involves selling one currency to buy another. Some of the most commonly traded currency pairs are USD-CHF (US Dollar / Swiss Franc), EUR-USD (Euro / US Dollar), USD-JPY (US Dollar / Japan Yen), and GBP-USD (British Pound / US Dollar).

The main Trading centers of the forex currency market are New York, London, Frankfurt, Tokyo, and Sydney. They are located in different time zones. So, this makes the forex market trade 24 hours a day.

There is no central exchange or location where the trading is conducted, and most trades are executed between two interested parties who use the phone or other electronic means to communicate. The main market for forex currency trading is the inter-bank market, in which banks, insurance companies, corporations and other large institutions trade to manage the risks associated with fluctuations in foreign exchange rates.

Trading characteristics

There is no unified or centrally cleared market for the majority of FX trades, and there is very little cross-border regulation. Due to the over-the-counter(OTC) nature of currency markets, there are rather a number of interconnected marketplaces, where different currencies instruments are traded. This implies that there is not a single exchange rate but rather a number of different rates (prices), depending on what bank or market maker is trading, and where it is. In practice the rates are often very close, otherwise they could be exploited by arbitrageursinstantaneously. Due to London's dominance in the market, a particular currency's quoted price is usually the London market price. A joint venture of theChicago Mercantile Exchange and Reuters, called Fxmarketspace opened in 2007 and aspired but failed to the role of a central market clearing mechanism.

Retail foreign exchange brokers

There are two types of retail brokers offering the opportunity for speculative trading: retail foreign exchange brokers and market makers. Retail traders (individuals) are a small fraction of this market and may only participate indirectly through brokers or banks. Retail brokers, while largely controlled and regulated by the CFTC and NFA might be subject to foreign exchange scams.^[7][8] At present, the NFA and CFTC are imposing stricter requirements, particularly in relation to the amount of Net Capitalization required of its members. As a result many of the smaller, and perhaps questionable brokers are now gone. It is not widely understood that retail brokers and market makers typically trade against their clients and frequently take the other side of their trades. This can often create a potential conflict of interest and give rise to some of the unpleasant experiences some traders have had. A move toward NDD (No Dealing Desk) and STP (Straight Through Processing) has helped to resolve some of these concerns and restore trader confidence, but caution is still advised in ensuring that all is as it is presented.

Exchange Traded Fund

Exchange-traded funds (or ETFs) are open ended investment companies that can be traded at any time throughout the course of the day. Typically, ETFs try to replicate a stock market index such as the S&P 500 (e.g., SPY), but recently they are now replicating investments in the currency markets with the ETF increasing in value when the US Dollar weakens versus a specific currency, such as the Euro. Certain of these funds track the price movements of world currencies versus the US Dollar, and increase in value directly counter to the US Dollar, allowing for speculation in the US Dollar for US and US Dollar denominated investors and speculators.

Investment uses

ETFs generally provide the easy diversification, low expense ratios, and tax efficiency of index funds, while still maintaining all the features of ordinary stock, such as limit orders, short selling, and options. Because ETFs can be economically acquired, held, and disposed of, some investors invest in ETF shares as a long-term investment for asset allocation purposes, while other investors trade ETF shares frequently to implement market timing investment strategies.[4] Among the advantages of ETFs are the following:[7][14

Government budget deficits or surpluses

The market usually reacts negatively to widening government budget deficits, and positively to narrowing budget deficits. The impact is reflected in the value of a country's currency.

Balance of trade levels and trends

National Central Banks

National central banks play an important role in the foreign exchange markets. They try to control the money supply, inflation, and/or interest rates and often have official or unofficial target rates for their currencies. They can use their often substantial foreign exchange reserves to stabilize the market. Milton Friedman argued that the best stabilization strategy would be for central banks to buy when the exchange rate is too low, and to sell when the rate is too high—that is, to trade for a profit based on their more precise information. Nevertheless, the effectiveness of central bank "stabilizing speculation" is doubtful because central banks do not go bankrupt if they make large losses, like other traders would, and there is no convincing evidence that they do make a profit trading.

Trade

Trade is the voluntary exchange of goods, services, or both. Trade is also called commerce. A mechanism that allows trade is called a market. The original form of trade was barter, the direct exchange of goods and services. Modern traders instead generally negotiate through a medium of exchange, such as money. As a result, buying can be separated from selling, or earning. The invention of money (and later credit, paper money and non-physical money) greatly simplified and promoted trade. Trade between two traders is called bilateral trade, while trade between more than two traders is called multilateral trade.

International Trade

International trade is exchange of capital, goods, and services across international borders or territories. In most countries, it represents a significant share of gross domestic product (GDP). While international trade has been present throughout much of history (see Silk Road, Amber Road), its economic, social, and political importance has been on the rise in recent centuries. Industrialization, advanced transportation, globalization, multinational corporations, and outsourcing are all having a major impact on the international trade system. Increasing international trade is crucial to the continuance of globalization. International trade is a major source of economic revenue for any nation that is considered a world power. Without international trade, nations would be limited to the goods and services produced within their own borders.

Financial Institution

In financial economics, a financial institution is an institution that provides financial services for its clients or members. Probably the most important financial service provided by financial institutions is acting as financial intermediaries.

What is the best Forex trading strategy?

There is none. You should constantly develop your own strategies for every possible market situation, if you want to be in profit. Specific strategies can only be good for a certain period of time and for certain currency pairs.

What the working hours of Forex market?

Forex market is open from 22:00 GMT Sunday (opening of Australia trading session) till 22:00 GMT Friday (closing of USA trading session).

Who owns Forex and where is it located?

It's not owned by anyone in particular. Forex is an Interbank market, meaning that it's transactions are conducted only between two participants - seller and the buyer. So as long as existing banking system will exist, Forex will be here. It's not connected to any specific country or government organization.