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Top 5 Most Traded Currencies

Foreign exchange market is the biggest and most liquid market that exists at the moment. Forex market connects thousands of banks, companies, governments, and traders into a single group, enabling them to conduct their business on an international level.

Like any other market, forex deals with exchanging goods – in this case these goods are currencies. In this article we bring you top 5 most tradable currencies, and thus most popular.

US dollar

Also known as greenback, the US dollar is the home denomination of the world’s biggest economy – the United States. US dollar is the most traded currency on the planet, as it acts as the unofficial global reserve currency, held my almost every central bank. It is especially interesting that US dollar is used by some countries as an offical currency (as a replacement to local currency), a practice called dollarization.
Three main groups of factors that influence the US dollar are: supply and demand, sentiment and market psychology and technical factors.

Euro

Euro is the world’s second most traded currency, and is used by approximately 338 million people every day. The euro was introduced on January 1, 1999 as a virtual currency for cashless payments and accounting purposes. Banknotes and coints were launched three years later, on January 1, 2002. The European Central Bank is in charge of monetarz issues within the EU.

Japanese Yen

The Japanese yen is the third most commonly traded currency in the world.  The central bank that stands behind Japanese yen is the Bank of Japan.
The Japanese yen is considered a safe haven currency, mainly due to Japan’s advanced economy with a well-educated workforce.

British pound

The British pound, also known as sterling, is the fourth most traded currency in the forex market. The UK did not accept euro as its official currency, it kept the pound for a variety of reasons, such as historic pride and maintaining control of domestic interest rates.
Due to its high value in comparison with its peers, the pound is also a significant currency benchmark for many nations and acts as a very liquid component in the forex market.

Swiss Franc

Swiss Franc is the official currency of Switzerland and it is also used in Liechtenstein.
The Swiss franc is also considered a safe haven currency, due to the stability of the Swiss government  and its financial system. The country’s independence from the EU makes it immune to any negative political and economic events that may occur in the region.

Understanding The Role Of Forex Brokers

Understanding The Role Of Forex Brokers

Since the foreign exchange market is decentralized, meaning that there is no central governing body that runs the market, every single transaction and exchange is done through brokers or brokerage firms. The foreign exchange market is constantly growing and new brokerage firms are opening on a daily basis. The increasing number of brokers gives every trader the ability to choose which brokerage firm they wish to conduct their business through. Of course, the brokerage firms are competing with each other, providing different services to the future customers and offering them various benefits if they decide to continue trading with them.

If you are just starting out with trading on the foreign exchange market, you will be choosing your brokerage firm very soon. There are many options out there and you will have to decide which broker suits your needs the best. This article will serve you as a guide and it will point you out some key features you should pay attention to during your research of brokerage firms and what to be wary of. Just like in every line of work, you might encounter some brokerage firms which are not trustworthy and it really important that you are capable of identifying and staying away from them.

Key features

Surely, every brokerage firm has to start somewhere and you shouldn’t cross off the new brokerage firms right away, but always take a look at the date when the firm was established. If they are providing services to forex traders for a long time, that speaks a lot about their professionalism and success in general. The brokerage firms whose only goal is to fraud prospective traders usually do not last long and they are closed very quickly. If the firm is older than one year, it means that they remained in business and that investors are choosing it for conducting the trading business.

It might sound silly to pay attention to the location of the brokerage firm since all exchanges are done online, but it is of great importance nevertheless. Different countries around the world have different laws when it comes to trading on the foreign exchange market and it is advised to choose a brokerage firm which is located in a country that has strong regulations in case something goes wrong regarding the brokerage firm you are using. A trader has the ability to file a complaint or to contact the authorities and their rights will be protected. This level of safety for traders is not available in every country so make sure you know the exact physical location of the brokerage firm and the rules and regulations which are installed in order to protect a trader.

The brokerage firm should also set their own regulations outside of the official government in order to keep the safety of their clients when they are trading with them. The brokers should also be registered and given a permit to run their business. Every brokerage firm that is serious about their work should have that information available on their official website and anyone should be able to see it. It is most commonly located in the section of the website which describes the firm and gives the details about their history and the way they operate.

Brokerage firms offer their own trading platforms and traders should take a closer look at them as well. A trading platform should be easy to use and provide a trader with the easy access to the charts and any other tool for analysis they want to use while trading. The design should be pleasing but not too complicated and the most important buttons which are ‘buy’ and ‘sell’ should be clearly visible. Some traders might also be interested in customizing the trading platforms, meaning that they have the ability to pick and choose the information they want to receive. Filtering the news is another great option especially if a trader wants to use the trading platform for the fundamental analysis as well.
The best way to see if a trading platform suits you is to open a demo account. Most brokerage firms offer this option for free and you can use it regardless of your previous experience on the foreign exchange market. The demo accounts are a great way to learn about trading on the forex market but they are also useful if you want to test out the trading platform as well.

A number of brokerage firms also have mobile applications for iPads, iPhones, or Android devices available for their clients. These applications are often free of charge once you register with a firm and open your trading account. Using a mobile application can make trading a lot easier if you are away from your computer for longer periods of time, granting you the access to your account whenever you wish to do so.
It has already been mentioned that the brokerage firms are competing amongst themselves when it comes to different offers they have for the future users and that information can be very valuable when opening a trading account. You should look into standard and micro accounts, depending on the amount of money you wish to invest in trading on the foreign exchange market. Standard accounts are more suitable for professional traders who are ready to invest a significant amount of money, while micro accounts are appropriate for the novice traders who are just starting out on their trading journey. The minimum deposit or the amount of money you need in order to open an account varies depending on the brokerage firm. If you want to start with the standard account, you need to have at least $1000 as your deposit. On the other hand, micro account can be created with as little as $1.

Leverage is another thing you should learn about when searching for an ideal brokerage firm if you plan on using that option when trading on the market. Surely, leverage can be both good and bad and it is up to you to make a decision whether you are capable of making the best of it or not. You need to be aware of the risks which you might be facing when using the leverage. Some brokerage firms offer higher leverages for all of their clients, not only for the standard accounts, so if you want to take an advantage of that offer, you should find a broker that provides the leverage you want to use.

Customer support

A brokerage firm should be available for their customers around the clock since many of their clients live in different time zones and trading on the foreign exchange market happens twenty-four hours a day. Some offer live chats while others have telephone lines reserved especially for serving the customers and helping them out if they have any trouble with using the website or the trading platform they offer. Even if you are not experiencing any malfunctions, you should test it out and call the support just to see if they are truly available to you at any given time.

Of course, brokers are earning money from you whenever you use their services. It is not a large number and it goes unnoticed with some foreign exchange market traders but a brokerage firm should clearly state what the source of their income is. They most commonly make money from the difference between the bid and ask price and they only take a few pips. Some might even try and advertise themselves as a brokerage firm that takes absolutely no commissions, but they earn money from wide spreads. Overall, the firm should tell you what they are charging you for since every customer has a right to know that information. Look around a brokerage firm’s website and you should find that data if the firm is respectable and serious about their business. A broker should be transparent and provide you with every detail you want to know.

Conclusion

Choosing a right brokerage firm is a difficult task for some forex traders because they are eager to start trading right away, but it is of paramount importance to take your time and find the right broker. Always keep in mind that the brokerage firm you select will be the place you visit on a daily basis and they will provide you with their services in every trade you make on the foreign exchange market.

Doing a proper research into these firms can help you a lot in the long run and you shouldn’t take it lightly. Explore every option or service they offer and think about the way it might aid you when trading on the forex market. Traders sometimes overlook these details in favor of low prices the firm provides, but they are significant as well. After all, you are putting your money in their hands and since you have the option to pick and choose, take an advantage of that and find the right brokerage firm that suits your needs.

Getting Started In Foreign-Exchange

The location foreign-exchange (forex or FX) market will be the world’s largest market, with over US$1 trillion exchanged daily. Prior to the generation of Forex Futures by the Chicago Mercantile Exchange (CME) in 1970, there have been only futures contracts for bodily items or Commodities Futures Forex futures ushered in the age of Fiscal Futures which created securing against financial danger achievable. Considering that the commodities agreement is founded on 125,000 euros, your revenue or decline would be 125,000 x $.0010 = $125.00

Speculation that is leveraged means being limited when you anticipate the value to devalue and trying by being long on Forex Commodities once you assume the worth of the currency pair to comprehend to cash in on a directional relocate the underlying currency match. As a result of leveraged nature of commodities trading, you might quickly get a profit of maybe more or 1% on movements as small as 0.1 %, with respect to the amount of control given from the Forex contract. The EUR/USD couple decreased by only 0.3 % nevertheless, 142% are made profit by you by wondering through the EUR Commodities Nonetheless, this is not to state that forex futures agreements are over-the-table parse; the futures are still bound into a selected ‘size per deal’ and so are presented merely entirely figures (unlike forward contracts). It’s very important to remember that all currency commodities quotations are created from the U.S. money. Hedgers use chance by insulating themselves against any potential value movements. One main intent is to neutralize the result of currency fluctuations on sales revenue. Once we can easily see, forex futures operate similarly to traditional share and commodity futures.

The challenge supplies them together with the capability to business 36 of the very fluid futures agreements across six asset courses – Equity Indices, Energy, Alloys Rates of Interest and Farming. Whilst contending, traders may also be confronted with instruction modules that address a variety of issues including creating a business strategy, risk management, and technological & simple industry investigation. You take a look at all preceding attacks daily at and can observe a brand new Final the Hole: Futures Version show live!

Additionally there are skilled forex commodities investors (typically corporations) who’re inside the forex commodities market solely for arbitrage intent with exceedingly intricate desktops and supplements managing computerized packages built to search for any smallest value discrepancies across numerous deals all around the globe. As the forex market is really an intricate and big one, there are numerous ways to look for arbitrage opportunities but such options are generally available only to skilled companies that has usage of the electronics and software necessary for such sophisticated international forex trading. This is how many multiple-billion-dollar companies collapsed trading forex futures that are overnight.

Some Vital Tips For Forex Trading

Forex trading is proposed for people who are fascinated by the operations of trading forex rather than people who concentrate on profiting. Feelings have a larger part in influencing the outcomes. A person why should fretful acquire benefit to settle his or her costs and pay off his/her advance will probably exchange the nonappearance of insisted signs. You may consider being a full time dealer after you have all the essential abilities. When you are basically starting, it is vital to have a substitute arrangement to take care of your costs. The most basic tips in forex trading are:

Exchange signals rather than the trades

On the off chance that you have had some compelling exchanges or exchanges and in this while you have built up some capital, it gets alluring to search for more forex trading risks. Be that as it may, you may end up taking the wrong signs. This is inclined to present to you lost what you had earned from extraordinary exchanges – At the point when dealing with a lone exchange it is basic to disregard past ones, paying little respect to those business being losses or gains this will empower you to focus on the most fundamental signs to settle on a decent choice. Besides, avoid going out on a limb more than would normally be appropriate as you have more money and have been productive over the short past.

Being over-confident

Being pompous can have a bigger number of genuine repercussions than not having certainty. When you need certainty, you end up doing nothing. On the other hand, when you are so sure of your exercises without having awesome signs can cost you impressive cash. Making a couple of not too bad trades is not a sign that you are a specialist merchant. Additionally, making a couple of repulsive exchanges does not mean you are a dreadful forex broker. It is vital to assess your certainty levels to maintain a strategic distance from awful choices and disappointment. Therefore, you need to analyze the business showcase fundamentally to settle on the right decisions.

Abstain from rivaling different brokers

Diverse dealers use distinctive trading approaches and styles. This clears up why the outcomes are every now and again distinctive. A segment of these merchants may be anxious to take a 3% hazard for a 6% to 11% month to month benefit, while then there would be different brokers who may be prepared to take more than 25% hazard and expect to twofold their objectives consistently. It habitually requires impressive time and exertion for dealers to figure out their exceptional style of forex trading. There for the most part have distinctive principles and systems, and there are some scheming ones who are out there just to get their hands on individuals’ well deserved cash – Before you pick a specialist, you have to complete a point by point foundation research on them and figure out whether they are dependable.