Forex 101

Forex is a 24-hour market that has no official trade opening or closure. Trades can take place anytime, anywhere (even online), without any limitations or dependency. However, to make profits, traders must constantly be on the lookout for opportunities. Besides, as the market is affected by important events, investments in the market are also volatile. While some events can be predicted, others cannot be; leaving a serious effect on a currency.

Foreign exchange markets comprise one of the largest markets in the world. It is also the most liquid market, given the huge diversity of stakeholders. Based on the aims, time horizons and risk appetite, agents in the market are divided into five main categories:

Forex charting is a reliable system of getting information and statistics about the forex market. It helps identify Forex trading signals and short-term currency trends and provides a realistic view of the forex market. It is user-friendly, interactive and powerful tool and depicts currency fluctuations during a given time period, which may range from a minute to a month or several years. Represented in line, bar or candle format, forex charts provide real-time data, along with a range of tools and features that facilitate forex trade. Forex charting is especially useful for traders who use technical analysis to predict price movements.

Foreign exchange rates indicate the worth of one currency against the other.  For instance, a foreign exchange rate of two New Zealand Dollar (NZD) to Euro (EUR) indicates that two NZD is worth one Euro. Forex rates or fx rates are driven by several factors, which include fundamental, political, psychological and technical factors. For instance, countries with sound economic policies related to inflation, capacity utilization, unemployment, balance of payment and import and export have stronger currencies.