Forex trading basics

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Forex Market Basics

The Foreign Exchange market (also referred to as the Forex, FX market, "Cash" Forex or Spot Forex market ) is the largest financial market in the world, with more than $1.5 trillion changing hands every day — 30 times larger than the combined volume of all U.S. equity markets. Another major feature of the Forex market is that it operates 24 hours a day, corresponding to the opening and closing of financial centers in countries all across the world, starting each day in Sydney, then Tokyo, London and New York. At any time, in any location, there are buyers and sellers, making the Forex market the most liquid market in the world.

What to trade in Forex Market?

In the forex market, currency trading is always done in currency pairs, such as EUR/USD or GBP/USD. Accordingly, all trades result in the simultaneous buying of one currency and the selling of another. The base currency is the "basis" for the buy or the sell. It is useful to consider the currency pair as an instrument, which can be bought or sold.

Understanding Forex quote

• Base currency: The first currency in the pair.
• Counter Currency: The second currency in the pair. Also known as the terms currency.

The US dollar is the centerpiece of the Forex market and is normally considered the ’base’ currency for quotes. This includes USD/JPY, USD/CHF and USD/CAD. For these currencies and many others, quotes are expressed as a unit of $1 USD per the second currency quoted in the pair. For example, a quote of USD/CAD 1.1302 means that one U.S. dollar is equal to 1.1302 Canadian dollar.

BID and ASK Prices

When trading forex you will often see a two-sided quote, consisting of a ’bid’ and ’ask’. The ’bid’ is the price at which you can sell the base currency (at the same time buying the counter currency). The ’ask’ is the price at which you can buy the base currency (at the same time selling the counter currency).

Commission-free, but with spreads

Most Forex brokers offer commission-free Forex trading. Spread - The difference between the bid and ask price of a currency. Normally 3-5 pips on the Majors.

Rollover - What happens to my open positions at the end of the trading day?

Process whereby the settlement of a deal is rolled forward to another value date. The cost of this process is based on the interest rate differential of the two currencies. Most brokers will automatically roll over your open positions, allowing you to hold a position for an indefinite period of time.

Leverage & Margin

The leverage available in forex trading is one of main attractions for many traders. Leveraged trading, or trading on margin, simply means that you are not required to put up the full value of the position. Forex brokers provide more leverage than stocks or futures. In forex trading, the amount of leverage available can be up to 400 times the value of your account.

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Learn Forex

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How do I begin? Please give it to me SIMPLY.

1. The best advice on how to learn to trade profitably is to learn from experts with proven track records. Many learning styles are available to beginners at all levels: books, CDs, online courses, group seminars, even one-on-one mentors who will come right your home for a few days. We outline our Forex-Trader picks in Learning Forex Trading. Learning to trade from experts is worth every penny and has saved us untold thousands in mistakes.We would not recommend starting forex trading without any training. It is not hard to learn, nor difficult to trade successfully, but you must first provide yourself with a basic functioning knowledge of ’the game you’re in’.

2. While you are learning you will need charting software to practice reading the Market. Charting is an indispensable tool that shows you in real-time data what the market is doing moment by moment and also what the market has done in the past. As you learn to analyze these charts you can determine what trades to enter and exit, where to set your stop losses, limits etc. There are several good charting software services that you can subscribe to online monthly. See our Forex-Trader tested Charting Software picks in Tools of The Trade.

3. Then, to perform your actual trades online you need a real-time ’trading platform’ to execute your ’buys’ and ’sells’ directly in the Foreign Currency Market. You obtain a trading platform from a Forex Clearinghouse that is connected real-time to the interbank market. There are many good Clearinghouses (also confusingly called Brokerage Firms, Market Makers, etc.) that provide you with the trading platform to trade the funds in the account you have opened with them. Before you begin trading your ’real’ money, while you are learning, you will practice on your own ’demo account’ with play-money in it, which will be provided to you by the clearinghouse you plan to trade through. The contractual relationship you enter into with your Clearinghouse is a very important one because the Clearinghouse you choose determines many trading features and financial advantages to you both as a trader and as an investor. Forex-Trader tested Clearinghouses are reviewed in Tools of The Trade.

We have outlined a Getting Started path with uncomplicated steps. This is the path that we would take if we were beginning trading over again today with ’what we know now’. The products and services we mention in these steps are all ones that we have personally used for some time with consistent success. As always you are free to forge your own path, and if you do, happy hiking. There is a mountain of products and services try out, and if you find ones you like better we would love to compare notes w

New to the Forex market?

We've worked hard to distill our collective trading experience into an approach suitable for all skill levels.
Step 1: Understand the FOREX market. Dive into Forex 101 for a compact overview of the basics or sit back and join us at one of our live interactive webinars.
Step 2: Prepare to trade in a live environment. Register for one of our training courses and study at your own pace or join us at a local workshop, where our experienced instructors can teach you in a dynamic classroom setting.

Forex training and education

Whether you need ideas for a new strategy, to brush up on platform tools, or just to learn our platform for the first time, we have the resources you need at FOREX.com. Open a free forex practice account to test your knowledge with no risk or obligation, attend a webinar, or check our schedule for a forex workshop in your area.
Market research you can count on Our experienced research team provides robust market analysis you won't find anywhere else, from real-time commentary to essential daily and weekly reports that summarize key market developments with an insightful perspective. More about our forex research offering.

System stability and reliability

Our technology infrastructure is designed to support a 24-hour trading environment with 100% uptime. We subject our systems to rigorous testing and maintain multiple connections through internet backbones to assure connectivity for our clients around the globe.
Successful firm with solid financials FOREX.com is a division of GAIN Capital Group, LLC, a pioneer in the online foreign exchange industry. The firm is well-capitalized, with an experienced management team and strong corporate governance. GAIN's majority shareholders are five well-known U.S. venture capital and private equity firms with over $35 billion in combined assets. More awards & accolades.

Powerful trading tools

Spot and seize potential market opportunities with our forex trading platform. We designed our tools to make it easy to put your trading strategy into action with advanced order management tools, a choice of robust charting packages, and auto execution tools.
24-hour access to licensed representatives Reach our knowledgeable, Series 3 registered reps 24-hours a day during market hours and on Saturdays from 9am-5pm ET. Get answers quickly by phone, email or chat

Trade Currencies and Spot Metals

Trade currencies and spot metals at FOREX.com. Dealing spreads are as low as 1-2 pips on the most widely traded currency pairs. As always, you pay no commissions at FOREX.com, only the bid/offer spread. Our prices are quoted in more precise 0.1 pip increments to help you take advantage of smaller price movements. Learn more about our pricing.
Quality executions Our mission is to provide you a fair, efficient trading environment, which means quoting competitive spreads and ensuring quality executions. Our customer base represents traders from over 140 countries, and the firm trades nearly $200 billion per month with its customers and trading partners.* Top 10 reasons currency traders choose FOREX.com

Currency Technical Report

May 20 11:22 GMT, by FX Greece Negative news from US are good for the dollar. Yesterday's rise was limited at the second resistance level, we had set, at 1,3660-70. The retracement...
Daily FX ReportMay 20 11:18 GMT, by Varengold Bank The currency pair traded in a sideway movement since the beginning of May, but last week it broke through the support at 147.84 and as a implication t...
Technical Analysis Daily: USD/JPYMay 20 10:22 GMT, by iFOREX.bg Dollar/Yen also decreased yesterday. On the 4 hour chart after the break down of the 95.70 support, the currency couple reached the bottom 95.47 and c...
All Daily Forex Technical Reports >>

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Forex News

Currency Trading News by DailyFX
Forex news about foreign exchange rates and reports on world business events that affect the currency market provided by DailyFX.
Forex TV.com - Forex News
Forex TV News: Daily, global news coverage of the forex and currency markets.
U.S. Bureau of Economic Analysis
U.S. Bureau of Economic Analysis
FXstreet.com: Fundamental: Economic Calendar
FXstreet.com: Economic Calendar. All the info one needs to stay in touch with the events that will move the market.
IBT FX Center News

RECOMMENDED FOREX EBOOKS

Forex ProfitsForex day trading book/videos.
Forex Secrets ExposedProven Forex Strategies Revealed On Videos!
The Way To TradeA breakthrough approach to trading in any market (world beating affiliate program)
Forex Trading StrategyLearn how to day trade/swing trade major currency pairs.

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Forex Articles

Forex articles from ForexArticleCollection.com. All these Forex articles are written by the excellent Forex traders, strategists and analysts. You'll find the articles, trading courses and methods that are an indispensable inherent part of improving your Forex trading strategy.
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Free Elliott Wave Tutorial from Elliott Wave International
Elliott Wave International's tutorial is the most comprehensive introduction to the Elliott Wave Principle available in cyberspace. All ten lessons have been adapted from Prechter and Frost's Wall Street bestseller, Elliott Wave Principle - Key to Market Behavior.
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Forex eBooks
Sure Fire Trading
Institutional Forex System
Forex Trading Explained
Grab Ten Pips Daily In The Forex Market
Forex Profits
Forex Secrets Exposed
The Way To Trade
Forex Trading Strategy
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Forex Trading Strategies
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Free Financial Education Center

This incredible site was developed over the course of one full year by Online Trading Academy's faculty of the best trader instructors and analysts. It will give traders and investors like you access to the best education available today on the web, and it is ABSOLUTELY FREE. This information will help you become a more successful investor or trader if you take the time to invest in yourself. Starts the Free Financial Education Center now!
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Free Forex Course from Online Trading Academy
You're about to receive incredible streaming content - absolutely FREE! The course is a Macromedia Flash presentation complete with audio track. You will find out how to get started in Forex and what you can do to increase your odds for success as a trader substantially.
Starts the free forex course now!
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Online Trading Academy Store

Home study is a critical part of your transformation into a succcessful trader. Our in-depth CD courses allow you to learn at your own pace and to repeat material when necessary, so that your trading education can advance on a daily basis. Our downloadable, printable e-book is also an excellent choice for home study. A recent customer from Fort Smith, AR, wrote: "The price was excellent. No better price anywhere & delivery was right on time." We try our best to get our products out to you as fast as possible! Another customer recently wrote: "I am so grateful that I found your website. The class and material available is well beyond my expectations." Try them for yourself - we think you'll love them too!
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Average True Range

The task of the Average True Range (ATR) indicator is to gauge volatility over a certain period of time. Keltner Channels and Starc Bands are examples of other systems for trading in which ATR is also used.
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How to use Bollinger Bands for Forex trading?


Discovered by John Bollinger, the Bollinger Bands is a simple moving average based tool that allows people in Forex trading to estimate the instabilities and trend in the Forex market. Let us have a brief look at the concept of Bollinger bands and how you can use it to improve your Forex trading strategy.
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Using Moving Averages


The purpose of moving averages is purely to determine the mean exchange rate or price of currency pair in a given period of time. The simple moving average (SMA) and the exponential moving average (EMA) are the most widely used types of moving averages. The former is done, for example, by registering the closing prices of the last 50 days, summing them and finally dividing the sum by 50. This gives us the simple moving average for a period of 50 days. Exponential moving averages are similar to simple moving averages, but they are more complicated to calculate. They give more importance to the latest closing prices and hence react more rapidly to recent changes. Luckily, EMAs are mechanically and immediately determined by the majority of charting packages.
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Knowing When to Stop Trading

The worst thing a trader can do is lose control while on a winning streak. This is where trading in the foreign currency market is similar to gambling. Players who do not know when to stop end up losing everything. This is what we call overtrading. It represents the biggest threat to traders and accounts for the number one source of losing money in markets.
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Relative Strength Index Explained


Relative Strength Index (RSI) is used to quantify the strength of the entire set of ascending movements in opposition to all descending movements within a given period of time. The following is the Relative Strength Index equation:
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How to Trade Successfully During Unstable Markets


Many buyers and sellers consider unstable markets to be a time of favorable conditions for trading. While large market variations can represent a great chance for profit, they can also mean losing a lot of money if you are not properly prepared. Unstable markets require traders to modify their approach. In this article, we will look at some important points to consider during volatile markets.
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Understanding the Meanings of Overbought and Oversold

The terms "overbought" and "oversold" are commonly used by analysts when talking about the condition of the market. These terms appear to be complex but they can be simple to understand. They are very important to comprehend when analyzing market movements for trading signals.
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Understanding Stop Losses


A proper understanding of stop loss in Forex trading is essential if you want be a winning trader. Good traders will not hesitate to accept defeat and acknowledge that they made a mistake. It is impossible to be right every single time and the sooner you accept this, the sooner you will start minimizing your losses.
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Assessing Risk and Reward in Forex Trading


The question of measuring risk and reward in the forex market is a very complex one. It is very difficult to find the correct response due to the inconstancy of market conditions. In this sense, risk and reward in forex trading is similar to the weather, which means that there are no laws, only approximations.
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Alma Forex and Its Easy Entry Requirements

Latest Forex broker that got listed on my site is Alma Forex — a really easy entry-level broker that supports MT4 trading platform and cent accounts. I call it an entry-level broker because even those who believe that Forex isn’t something easily accessible can try it out by spending only several minutes and bucks. That’s a plus for the newbie traders but usually not enough for the serious professional traders. Other highlights of this broker:» Up to 1:500 leverage.» Liberty Reserve, WebMoney and AlertPay e-currency payments.» 1 pip spread for trading accounts bigger than $100.» Microtrading from 0.001 standard lot.» Muslim-friendly accounts.
If you have any questions or comments regarding Alma Forex broker, please, feel free to reply below.

Win Hummer H3 with InstaForex

A new long-lasting promotion campaign was announced by InstaForex broker today. They now offer a brand new Hummer H3 SUV to the random winner of the drawing. Anyone who deposits (or in any other way increases the account balance, e.g. by profiting from trading) at least $1,000 and registers for a participation between June 1st 2009 and May 28th 2010 is eligible to win the prize. There are three types of prizes in total:» Hummer H3 for the random winner» 10 PDAs for 10 random winners» Free $100 bonus to every 100th registered participant
The drawing of the random winners is very clear and transparent, so no cheating from InstaForex is possible. At the end of May 28th 2010 at 23:59 system time the last digits of the EUR/USD, GBP/USD, USD/CHF, USD/JPY and USD/CAD currency pairs’ rates will determine the account number of the winning participant, which will receive his or her Hummer. 10 PDAs will be granted to the 5 preceding and 5 following accounts before and after the main winning account.
If you are interested in participating you can get more information about InstaForex and register for this drawing.

Real Scalping Contest from InstaForex

InstaForex has announced that the «Real Scalper InstaForex» contest will be held every week on Friday (full Friday trading session). It’s an extreme scalping contest that is performed on the real money accounts with $100 initial deposit and $1,500 prize fund. The rules are very simple — you register for the contest, fund the contest account with exactly $100.00 before Friday (server time) and trade all day on Friday to come with the highest balance out of all contestants. The prizes are distributed in the following way:» 1st place — 500 USD;» 2nd place — 400 USD;» 3rd place — 300 USD;» 4th place — 200 USD;» 5th place — 100 USD.
It’s an curious thing to know that in the first «Real Scaler Contest» only 10 traders out of 200 registered deposited exactly $100.00 before Friday and thus every 2nd participant became a winner that time. Of course, all the account balance that remains after the contest can be freely withdrawn by the participants. This contest is a great opportunity for the scalpers and short-term intraday traders to earn money and prove their skills. All traders are able to easily follow up the contest progress through the ranking table.
If you are interested you may get more information about InstaForex and register for this contest.

wo New Categories — Oil and Gold Trading Brokers

added two new Forex broker categories to the site today — Forex brokers with gold trading and Forex brokers with oil trading. Recently I’ve noticed that many traders seek opportunity to trade on something other than plain old currency pairs. Apart from being able to trade currencies they usually also want to have an opportunity to trade oil or gold from time to time when there are some good fundamental conditions for such trades. These two new categories should help traders to find those Forex brokers that fit their oil/gold trading needs, while they will still be able to choose only those brokers that support their favorite payment method and trading platform.
By the way, I failed to find any Forex broker with oil trading that wouldn’t offer gold trading, though it’s not true for vice versa (not all gold trading brokers support oil trading). So, if you see an oil trading broker you can be almost 100% sure that it also has GOLD among its trading symbols. And almost all gold trading brokers feature not only gold but also silver and sometimes platinum, while more advanced brokers offer all possible precious (and sometimes not only precious) metals.

Forex Technical Analysis for 05/11—05/15 Week

Floor Pivot PointsPair 3rd Sup 2nd Sup 1st Sup Pivot 1st Res 2nd Res 3rd Res
EUR/USD 1.2611 1.2788 1.3031 1.3208 1.3451 1.3629 1.3872GBP/USD 1.4208 1.4361 1.4641 1.4794 1.5074 1.5227 1.5507USD/JPY 92.66 94.14 96.62 98.10 100.58 102.06 104.54EUR/JPY 118.52 121.44 126.48 129.40 134.44 137.36 142.40
Woodie’s Pivot PointsPair 2nd Sup 1st Sup Pivot 1st Res 2nd ResEUR/USD 1.2804 1.3064 1.3225 1.3485 1.3645GBP/USD 1.4393 1.4705 1.4826 1.5138 1.5259USD/JPY 94.39 97.12 98.35 101.08 102.31EUR/JPY 121.97 127.53 129.93 135.49 137.89
Camarilla Pivot PointsPair 4th Sup 3rd Sup 2nd Sup 1st Sup 1st Res 2nd Res 3rd Res 4th ResEUR/USD 1.3043 1.3159 1.3197 1.3236 1.3313 1.3351 1.3390 1.3506GBP/USD 1.4683 1.4802 1.4842 1.4882 1.4961 1.5001 1.5040 1.5159USD/JPY 96.92 98.01 98.38 98.74 99.46 99.83 100.19 101.28EUR/JPY 127.13 129.32 130.05 130.78 132.24 132.97 133.70 135.89
Tom DeMark’s Pivot PointsPair EUR/USD GBP/USD USD/JPY EUR/JPYResistance 1.3330 1.4934 99.34 131.92Support 1.2909 1.4501 95.38 123.96
Fibonacci Retracement LevelsPairs EUR/USD GBP/USD USD/JPY EUR/JPY100.0% 1.3385 1.4947 99.57 132.3361.8% 1.3225 1.4782 98.06 129.2950.0% 1.3175 1.4731 97.59 128.3538.2% 1.3125 1.4679 97.13 127.4123.6% 1.3064 1.4616 96.55 126.250.0% 1.2965 1.4514 95.62 124.37
Tags: EUR/JPY, EUR/USD, Fibonacci, GBP/USD, pivot points, technical analysis, USD/JPYNo Comments »

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Fibonacci And The Forex Market — by David Mclauchlan
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Forex Software Packages — by Ryan Larson
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Investing in Forex — by Joe Clinton
Forex The Future Investment — by Mike Pachuta
Explosive Profits: 7 Reasons to Trade Forex — by Sorna Devadas
Why Trade the Forex? — by Susan Walker
Forex Avenue: The Road to Riches — by Scott Bianchi
Forex Trading — by Richard Goldie
Forex Enterprise — A Full Review — by Joey Merrick
Introduction To Forex Trading — by Marquez Comelab
The Benefits of Trading The Forex Market — by Marquez Comelab
Trading Forex To Advance Your Financial Position — by Jay Moncliff
The 6 Advantages Forex Trading Has Over Other Investments — by David Morrison
What Is Forex Trading? — by David Morrison
Forex Trade: Main Drawbacks of a Forex Trader — by Raul Lopez
Learn Currency Trade — Intro to The Forex Market — by Anna Rowe
Forex: Benefits of Trading the Forex Market — by Raul Lopez
Forex Trading — Understanding Commissions, Spreads and Trading Costs — by Rich Cochrane
Interested in Forex Trading? — by Jill Kane
Forex: What Is It And How Does It Work? — by Frederic Madore
Futures Versus Forex (Foreign Exchange Market) — by Jeff Slokum
Online Forex Trading — by Bob Hett
How To Get Started In Forex Trading — by Ron King
Forex Market Offers Opportunity And Information — by Jay Moncliff
Forex Glossary — by Norman Fleming
Introduction To Forex — by Norman Fleming
How To Get Started In Forex Trading — by Hana Lee
Reality of Online Forex Trading — by David Jones
Internet Marketing VS Forex Currency Trading — by Amin Sadak
Forex Made Easy for Everyone — by Brian Kolewe
Forex Trading — Opportunities for Individuals — by Anthony Trister
Your Mother Could Make Money In Forex Trading — by Wayne Watson
The History of Forex Trading — by Divyansh Sharma
A Short Introduction To Forex — by Adrian Pablo
Forex 101: Make Money with Currency Trading — by Rich McIver
Online Forex — by Rafik Patel
Shoes Or Forex? — by Marquez Comelab
Forex 101 — by John Sanderson
Currency Trading Is Not The Monopoly Of The Nerds And The Geeks — by Sara Chambers
What Is Rollover Interest In The Forex Market? — by Martin Maier
Investment Myths And The Forex Markets — by David Mclauchlan
The Forex Market And Its Three Distinctive Elements — by David Mclauchlan
The Prime Time For Daily Forex Trading — by David Mclauchlan
A Forex Quickie — How To Get An Educated Quick Start — by David Mclauchlan
Forex Trading, What Hours Should I Be Ready For Trading? — by Adrian Pablo
The Pros and Cons, of Trading a Forex Trading Demonstration Account — by Bill Boyd
Forex: Starting your own trading — by Andrey Moraru
Forex Practice Accounts — Are Demo Accounts Really a Good Thing? — by Paul Bryan
Methods or Techniques for Trading the Forex Market — by Linda Wainman
Why Forex Trading is an Ideal Home Business — by Garry Williams
How to Make Forex Give the Lifestyle You Want

Forex Basics

If you've already read the "What is Forex?" section then you should know what Forex market is and what it is all about. If not, please, do it. There are five essential aspects of foreign currency market a beginner trader (and an old one as well) should be aware of: Forex Fundamental Analysis Forex Technical Analysis Money Management Forex Trading Psychology Forex Brokerage
Understanding and mastering these sides of trading are crucial to organize your Forex trading experience.
Forex Fundamental Analysis
Fundamental analysis is the process of market analysis which is done regarding only "real" events and macroeconomic data which is related to the traded currencies. Fundamental analysis is used not only in Forex but can be a part of any financial planning or forecasting. Concepts that are part of Forex fundamental analysis: overnight interest rates, central banks meetings and decisions, any macroeconomic news, global industrial, economical, political and weather news. Fundamental analysis is the most natural way of making Forex market forecasts. In theory, it alone should work perfectly, but in practice it is often used in pair with technical analysis. Recommended e-books on Forex fundamental analysis: Reminiscences of a Stock Operator What Moves the Currency Market?

Forex Technical Analysis

Technical analysis is the process of market analysis that relies only on market data numbers - quotes, charts, simple and complex indicators, volume of supply and demand, past market data, etc. The main idea behind Forex technical analysis is the postulate of functional dependence of the future market technical data on the past market technical data. As well as with fundamental analysis, technical analysis is believed to be self-sufficient and you can use only it to successfully trade Forex. In practice, both analysis methods are used. Recommended e-books on Forex fundamental analysis are: The Law Of Charts Candlesticks For Support And Resistance Trend Determination
Money Management in Forex
Even if you master every possible method of market analysis and will make very accurate predictions for future Forex market behavior, you won't make any money without a proper money management strategy. Money management in Forex (as well as in other financial markets) is a complex set of rules which you develop to fit your own trading style and amount of money you have for trading. Money management play very important role in getting profits out of Forex; do not underestimate it. To get more information on money management you can read these books: Risk Control and Money Management Money Management (A chapter from The Mathematics of Gambling

Forex Trading Psychology

While learning a lot about market analysis and money management is an obvious and necessary step to be a successful Forex traders, you also need to master your emotions to keep your trading performance under strict control of mind and intuition. Controlling your emotions in Forex trading is often a balancing between greed and cautiousness. Almost any known psychology practices and techniques can work for Forex traders to help them keep to their trading strategies rather to their spontaneous emotions. Problems you'll have to deal while being a professional Forex trader: Your greed Overtrading Lack of discipline Lack of confidence Blind following others' forecasts
These are very professional books on psychology written specially for financial traders: Calming The Mind So That Body Can Perform Emotion Free Trading The Miracle of Discipline

Forex Brokerage

Every Forex trader like any other professional needs tools to trade. One of these tools, which is vital to be in market, is a Forex broker and specifically for Internet - on-line Forex broker - a company which will provide real-time market information to trader and bring his orders to Forex market. While choosing a right Forex broker things to look for are the following: Being a professional company you can trust Provide you with real-time quotes Execute your orders fast and accurately Don't take a lot of commissions Support the withdraw/deposit methods that you can use
For beginning Forex traders I recommend these four brokerage companies that are probably the best Forex brokers to start with: FXOpen — one of the most popular and progressive brokers with MetaTrader platform and comfortable trading conditions for all kind of traders.InstaForex — a reputable MetaTrader 4 brokers, allows Islamic Forex trading accounts, while you can deposit and withdraw money via WebMoney.FXcast — good because you can start trading Forex with as little as 10$, use MetaTrader 4 platform and the dozoen of various deposit and withdraw methods, including WebMoney, e-Bullion and wire transfer.LiteForex — broker that supports MetaTrader 4 Forex trading platform and doesn't require a lot of money to start with.

What is Forex?

FOREX - the foreign exchange market or currency market or Forex is the market where one currency is traded for another. It is one of the largest markets in the world.
Some of the participants in this market are simply seeking to exchange a foreign currency for their own, like multinational corporations which must pay wages and other expenses in different nations than they sell products in. However, a large part of the market is made up of currency traders, who speculate on movements in exchange rates, much like others would speculate on movements of stock prices. Currency traders try to take advantage of even small fluctuations in exchange rates.
In the foreign exchange market there is little or no 'inside information'. Exchange rate fluctuations are usually caused by actual monetary flows as well as anticipations on global macroeconomic conditions. Significant news is released publicly so, at least in theory, everyone in the world receives the same news at the same time.
Currencies are traded against one another. Each pair of currencies thus constitutes an individual product and is traditionally noted XXX/YYY, where YYY is the ISO 4217 international three-letter code of the currency into which the price of one unit of XXX currency is expressed. For instance, EUR/USD is the price of the euro expressed in US dollars, as in 1 euro = 1.2045 dollar.
Unlike stocks and futures exchange, foreign exchange is indeed an interbank, over-the-counter (OTC) market which means there is no single universal exchange for specific currency pair. The foreign exchange market operates 24 hours per day throughout the week between individuals with forex brokers, brokers with banks, and banks with banks. If the European session is ended the Asian session or US session will start, so all world currencies can be continually in trade. Traders can react to news when it breaks, rather than waiting for the market to open, as is the case with most other markets.
Average daily international foreign exchange trading volume was $1.9 trillion in April 2004 according to the BIS study.
Like any market there is a bid/offer spread (difference between buying price and selling price). On major currency crosses, the difference between the price at which a market maker will sell ("ask", or "offer") to a wholesale customer and the price at which the same market-maker will buy ("bid") from the same wholesale customer is minimal, usually only 1 or 2 pips. In the EUR/USD price of 1.4238 a pip would be the '8' at the end. So the bid/ask quote of EUR/USD might be 1.4238/1.4239.
This, of course, does not apply to retail customers. Most individual currency speculators will trade using a broker which will typically have a spread marked up to say 3-20 pips (so in our example 1.4237/1.4239 or 1.423/1.425). The broker will give their clients often huge amounts of margin, thereby facilitating clients spending more money on the bid/ask spread. The brokers are not regulated by the U.S. Securities and Exchange Commission (since they do not sell securities), so they are not bound by the same margin limits as stock brokerages. They do not typically charge margin interest, however since currency trades must be settled in 2 days, they will "resettle" open positions (again collecting the bid/ask spread).
Individual currency speculators can work during the day and trade in the evenings, taking advantage of the market's 24 hours long trading day.

Forex Trading Information

FOREX — the foreign exchange (currency or forex, or FX) market is the and the most liquid financial market with the daily volume of more than $3.2 trillion. Trading on this market involves buying and selling world currencies taking the profit from the exchange rates difference. Forex trading can yield high profits, but it is also very risky. Everyone can participate in Forex trading via the Forex brokers.
Don’t forget to check and bookmark my Forex blog to get the latest updates about Forex market and this site’s content. You can also join a friendly Forex traders community at the Forex Forum.

Latest Forex News

Euro Down as German GDP Falls More than ExpectedFri, 15 May 2009 08:46
The Eurozone single currency declined against all other major currencies today after the news went out that the economy of Germany contracted at a fastest pace in decades last quarter.
Indian Rupee Sells as Indian Elections End with UncertaintyThu, 14 May 2009 09:43
The Indian rupee declined against the U.S. dollar today showing the second bearish day as the country’s parliament elections aren’t easily predictable about the actual winner that will form the new government.
BoE Report on Inflation Spurrs Yen’s GrowthWed, 13 May 2009 11:47
The Japanese yen began to grow today, after a not very good Asian trading session, when the market participants began to react on the British central bank’s report on inflation and to favor the secure assets and currencies.
Euro Reaches 7-Week High on Chinese Investing ImprovementsTue, 12 May 2009 08:18
After the European Central Bank policy makers’ affirmation that rates will be maintained on hold, the euro reached a 7-week high against the dollar.