Advanced Trading is FOREX.com’s flagship platform and comes with a robust charting package loaded with a large selection of technical indicators (139 total) and drawing tools. Technical Analysis tools include automated technical analysis from Autochartist, which scans the markets for completed and emerging patterns and trade ideas. Also, more advanced traders can develop their own automated trading systems from the Automated Trading Center.
Trading in South Africa might be safest with an FSA regulated (or registered) brand. The regions classed as ‘unregulated’ by European brokers see way less ‘default’ protection. So a local regulator can give additional confidence. This is similar in Singapore, the Philippines or Hong Kong. The choice of ‘best forex broker’ will therefore differ region by region.
As you could see the foreign exchange market is not so complex to understand and not so dangerous to enter. You can become one of its participants in a few minutes and start earning money more than easily. How to learn Forex trading and specifically how to use the online trading platform are thoroughly presented on our website. You can read our educational materials and trading e-books which will help you understand the essence of Forex trading, discover its benefits, learn how to trade effectively and how to manage your risk.
^ The total sum is 200% because each currency trade always involves a currency pair; one currency is sold (e.g. US$) and another bought (€). Therefore each trade is counted twice, once under the sold currency ($) and once under the bought currency (€). The percentages above are the percent of trades involving that currency regardless of whether it is bought or sold, e.g. the U.S. Dollar is bought or sold in 87% of all trades, whereas the Euro is bought or sold 31% of the time.
Both types of contracts are binding and are typically settled for cash for the exchange in question upon expiry, although contracts can also be bought and sold before they expire. The forwards and futures markets can offer protection against risk when trading currencies. Usually, big international corporations use these markets in order to hedge against future exchange rate fluctuations, but speculators take part in these markets as well.
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Gold Standard System was formed in 1875. The main idea behind it was that governments guaranteed that a currency would be backed by gold. All the major economic countries defined an amount of currency to an ounce of gold as the value of their currencies in terms of gold and the ratios for these amounts became the exchange rates for these currencies. This marked the first standardized means of currency exchange in history. However, World War I caused a breakdown of the gold standard system as countries sought to pursue economic policies which would not be constrained by the fixed exchange rate system of the Gold Standard.
If your FOREX broker offers you a leverage of 1:100 you can trade with a 100 times more money than you have in your deposit. This means that if you want to buy 100 000 EUR/USD you only need to have a 1 000 actual euros. With this kind of leverage you can take a position that is a 100 times larger in value and expect a 100 times bigger profits or losses, therefore great care is advisable when placing your trade. Equities, on the other hand, are traded without leverage.
An interesting observation is that the Forex Market Hours of the Tokyo and London sessions overlap for approximately 1 hour (varies for other European countries). You can (and probably should!) use this fact to your advantage. This means that all the crosses of European currencies and the JPY will have the highest volatility at the start of the European session. So if you are trading the GBPJPY you can simply carry out a few powerful trades between 8am-9am GMT, and then you are free for the day!
In the above example, we bet that the EUR will go up against the USD, so we bought EUR/USD hoping to sell it later at a higher price. This is called long position. What should you do if you expect the EUR to go down against the USD? Well, then you do the opposite - you sell the EUR/USD with the hope to buy it cheaper later on. This short trading is how you take advantage of exchange rates that are going down.
Before we proceed, we need to answer the question - what is the Forex market? Simply put, It is a global decentralised market for trading currencies. Moreover, it is the largest market in the world, processing trillions of dollars worth of transactions every day. The key participants in it are international banks, hedge funds, commercial companies, various central banks and, of course, retail FX brokers and investors.
The need to exchange currencies is the primary reason why the forex market is the largest, most liquid financial market in the world. It dwarfs other markets in size, even the stock market, with an average traded value of around U.S. $2,000 billion per day. (The total volume changes all the time, but as of August 2012, the Bank for International Settlements (BIS) reported that the forex market traded in excess of U.S. $4.9 trillion per day.)