Hi to everyone, this is my first post, because I REALLY need help. Everywhere i see know this advertisements about Forex thing, got attracted, started to read about it, but still really confused about What is forex . All the explanations i find on the internet are very complicated. Too many smart words. Can someone explain what is forex by his own words ? Tired of websites. Thanks.
Open an account with Oanda, fund it with one dollar. Begin the learning process, there are no shortcuts.
Forex also known as FX is the trade of currency. US dollars against the Euro. Or the British Pound vs the US Dollar. Exchange rate or price of these pairs fluctuate based international bank trades, government manipulations, and general speculations, economy as well. Go to Oanda.com and sign up for their demo account and play around. And do a lot more reading.. Demo is free.. for life.
Very simple. You buy one currency with another currency. Later you reverse the transaction. If you've done it right, you earn money. For example, buy 1000 Euros when the rate is 1.30 Euros/$ and you'll spend $1300. If you sell your Euros when the rate is 1.31 Euros/$ you'll get $1,310 back. Net profit is $10. That's a forex trade.
Forex is foreign exchange. You basically sell one currency and buy another currency. The best way to learn the rudements of Forex is to open a demo account from a Forex dealer and play with it.
Forex is a term used for a market, like American Baseball League is a term for a division of players who compete with each other for wins. You and i don't play in that market anymore than we play in the National Baseball League. However, that can't stop us from betting on the games that are played. Brokers help facilitate our desire to bet on the games. They provide a real time update of the score, and help us keep track of statistics so we can be informed about our betting. They also manage the details of our betting accounts and are paid a little bit each time we make a bet, which makes up their cost and helps them make a profit. Liquidity providers are those who take all the bets placed through the brokers. They pay out all wins, and collect all the losses. Since most people bet wrong, they are able to make money consistently. They may play with the majors, meaning, they may actually be a player in the Forex market. That would be one of two ways they could make money. But i could be wrong about all this. See my other thread for details.
excellent question and all good replies. I too am a beginner and trying to figure it out. Best I can tell is, everybody wants their currency to be lower. It makes their exports cheaper. And since nobody has a viable econonmy, the only way they can think of to make money is to sell the crap they make to somebody else. And so that's what starts the pastime we call "The Race to the Bottom." But it's not that simple. Since occasionally countries need to import more than they need to export they then want their currencies to be strong so it makes things cheaper (especially in an election year.) You saw this happen after the tsunami in Japan. Suddenly, they needed to buy more things than they needed to sell, and the Yen went up compared to the dollar. But eventually, they have to start selling stuff to pay for all the stuff they bought and for that they need a weaker Yen. Many just don't have the patience for all of this, so they just trade technicals. They don't give a damn about what a country thinks or needs, all they know is if it looks good on the chart, trade it. It's really no different than gold. How much is an ounce of gold worth? Well, since we are all keeping score in dollars, it depends on how much a dollar is worth. welcome to the game
you are right, those who undertake this business as you described it are indeed playing a game and are not far from (if not in the midst of) gambling with a definite negative edge. I highly recommend to re-assess what currency trading is really all about unless you are a proud gambler: Fundamentally, it helps if you think of interest rates as the ultimate price of money. Fundamentally everything comes down to a chase for the highest risk adjusted yield. Technically, I have hardly ever heard of a profitable trader who merely looks at charts and longs or shorts because it looks "good on the chart" as you put it. I hope your bread and butter is not "fx trading" because with 2200+ posts under your belt you show a shocking ignorance and lack of knowledge for what really drives currency markets. The Japanese yen was not bought after the Japanese earthquake because "they" (whoever you are referring to) needed more "things to buy" (not sure what things you refer to? Salt, iodine, power cables, cement for the future reactor sarcophagus?). The yen was bought because markets entered a "risk off" state and money was seeking "save heaven" currencies, currencies that are generally perceived as being less risky to park funds in than others. P.S.: Please do not take it too personal (though a little personal would probably help) but don't you think reading some more sophisticated sources to educate yourself in this arena is time better spent than on posting? Just my 2 cents...
yes, fx is all I trade anymore. I think you would be shocked if you actually knew just how ignorant I am. I would like to learn more, especially the part about rates. Could you suggest a good place to start? So far about the most seriuos thing I have done is read James Rickards book "Currency Wars" otherwise, thanks for the reply, I am always for learning all you can learn about anything. The more the better. You sound like a nice person. So much of the info just goes over my head, and the rest of it I am well aquainted with, especially all the scams. For instance, I heard a man on CNBC say he felt AUD must go down over time, and I run a little trend trading system and it also went 100% short at the same time. So far it has been a very good trade, but I would like to know why. I'm not that deep when it comes to math, but I would like to understand more about what makes the forex markets move.