Forex Market

How do the currency markets work?

How the currency markets work, there are a lot of money markets in the world but the forex market is the market that sits on the throne of these markets in the normal every day pay in forex from five to six trillion US dollars, there is a lot to hear about forex if it does not trade in the first place but remains There is a question for everyone, which is how do the currency markets work? In this article, we will learn about how the currency markets work and on what basis many traders make a lot of profits.

How do the currency markets work?

There are a lot of commodities that people can trade through, there are currency pairs and there are contracts for differences that enable a person to buy and sell without actually buying the currency and many other things, we must mention that there are 3 types of currency trading markets:

• Forex future market: This market is where an agreement is made on a specific commodity in buying and selling, for example: a contract to buy or sell a particular currency is made for a specific amount and a specific date in the future and this contract is different from futures contracts, in addition to that these contracts are legally binding .
• Forex Forward Market: In this market, an agreement is made to buy or sell a specific currency for a certain amount of money to settle the order on a specific date, but it is in the future or it is within a set of dates.
• spot forex market: this market is the actual trade of a money pair. Which is set to trade settlement and this is a market in which the profit or loss is immediate in a short period of time.

What is the base currency?

The base currency is the first currency in the forex market, while the other currency is called the quote currency, furthermore, exchanging consistently deals with the strategy for selling one cash by another money and this is the motivation behind why monetary standards are remembered for the type of sets, it must be noted that the price of a currency pair is the value of one currency Basic in the pricing process Each currency of the currencies is listed in the form of 3 letters and symbolizes the first two letters of the region and the third letter is on the currency itself, the pairs are divided into four sections, namely:

• Major pairs: They are seven currencies called the major currencies and make up 80% of trading. These monetary standards are: EUR/USD, USD/JPY, GBP/USD and USD/CHF.
• Minor pairs: These monetary standards are less exchanged than the principle monetary standards and advantage from them by exchanging significant monetary standards against one another rather than the US dollar, and these monetary standards include: EUR/GBP, EUR/CHF and GBP/JPY,
• Non-major pairs: This money is a significant cash against one cash with a little economy, for example, USD/PLN, GBP/MXN, EUR/CZK.
• Major pairs: These sets are sets grouped by district like Australia and these sets resemble: EUR/NOK, AUD/NZD and AUD/SGD.

What moves the forex markets?

There are a lot of factors that affect the full effect on Forex, and the most important of these factors is the strength of supply and demand, and this is the most important factor that affects the volatility of the market movement.

By Michael Emad

My name is Michael Emad from Egypt, I am 20 years old. I will try as much as possible to review the latest news about Forex and Forex market .

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