Play the Game of Forex! (Part 1)

I will present some basic things to know when to start trading in the forex market. I will outline seven major currency pairs most commonly traded worldwide and explain price movements. Foreign exchange trading has changed recently year. At present, foreign exchange trading is no doubt and it is the largest financial market in the world, with a daily trade exceeded USD 4 trilion in 2010. The authoritative source for global foreign exchange market activity is Triennial Central Bank Survey of Foreign Exchange and Derivatives Market Activity, which in issued by the Bank for International Settlements (BIS). The official figure is available for the daily foreign exchange turnover taken last survey carried out in April 2010. 53 central banks and monetary authorities participated in the survey, collecting approximately 1300 market participants. Below from BIS:

• Global foreign exchange market turnover was 20% higher in April 2010 than in April 2007, with average daily turnover of $4.0 trillion compared to $3.3 trillion.
• The increase was driven by the 48% growth in turnover of spot transactions, which represent 37% of foreign exchange market turnover. Spot turnover rose to $1.5 trillion in April 2010 from $1.0 trillion in April 2007. (http://www.bis.org/publ/rpfx10.htm)

A report reveals interesting facts, it turns out 48% of the growth occurred in a cash transaction, which includes 37% of the total turnover of foreign exchange transactions in the world. The bulk of cash transactions made by retail traders, namely the ordinary rang like me and you. The group is expanding rapidly and is expected to contribute a larger portion of the total foreign exchange turnover at the time of the next survey results were announced. Official figures daily foreign exchange turnover is expected to reach more than $ 4 trillion at the time. The following chart details the average daily turnover by instrument:

Daily turnover of $ 4 trillion in foreign exchange markets is fabulous. According to the BIS Triennial Survey in April 2010 this number is greater than 23 times the average daily turnover of global equity, and larger 40-fold annual turnover of world gross domestic product. It is remarkable, is not it?

AndOverview Quarter BIS in March 2012, a senior economist at the Department of Monetary and Economic BIS, Morten Bech, estimates that the global activities of forex in October 2011 of about $ 4.7 trillion, compared to $ 4 trillion, according to a report central bank survey Triennial conducted in April 2010. Imagine, in daily average of $ 4.7 trillion.

The good news for retailers is due to increased demand, as the price difference transaction costs decline, the technology offers improved, and value-added services for foreign exchange brokerage firms soared.

It certainly is the best time to start trading in the forex market. Moreover, further strengthened by the daily record (people like me and you) who pursue foreign exchange business quickly.

Currency and Seven Major Currencies Traded

Foreign exchange is a market where each other money exchanged for another currency. This is why currency quoted in a currency pair. Every world currency by which the three-letter code as defined by the international standards organization (ISO) and is regulated by ISO 4217.

Eight currencies most commonly traded are:
1. USD (US dollar)
2. EUR (euro)
3. GBP (pound United Kingdom)
4. AUD (Australian dollar)
5. JPY (Japanese yen)
6. CHF (Swiss franc)
7. CAD (Canadian dollar)
8. NZD (New Zealand dollar)

These eight currencies most commonly traded form the seven major currency pairs. Seven currencies utamka controls the foreign exchange market in terms of volume traded. Since January 2012, it is estimated more than 85% of the volume traded in the forex market are controlled by seven major currency this.

Seventh major currency pairs are:
1. EUR / USD (euro vs dollar)
2. USD / JPY (US dollar vs. Japanese yen)
3. GBP / USD (United Kingdom pound vs US dollar)
4. AUD / USD (Australian dollar vs. US dollar)
5. USD / CHF (US dollar versus the Swiss franc)
6. USD / CAD (Canadian dollar versus the US dollar)
7. NZD / USD (New Zealand dollar versus the US dollar)

Okay, I will continue about how to read the quote currency in the next post.