Currency Trading: A Beginner’s Guide to Understanding Forex - Investment U

Currency Trading: A Beginner’s Guide to Understanding Forex - Investment U
FOREX-Dollar finds footing on U.S. economy as euro falters - Investing.com India
Why Is Forex Trading So Popular? - NuWireInvestor - NuWire Investor
Credit Suisse Hit With Extra EU Antitrust Charges in Forex Probe - U.S News & World Report Money

Posted: 10 Mar 2021 12:00 AM PST

Investors looking for a fast-paced market will feel right at home in currency trading. Forex markets operate 24 hours a day, five days-a-week. In fact, forex is the largest investment market in the world, with trillions in contracts traded daily. And, unlike stock markets that have thousands of listed securities, the bulk of currency trading occurs between some 20 global currency pairs.

There are many enticing reasons to invest in forex. For starters, the high liquidity of the market offers more trading opportunities. Transaction costs are also very low, even for retail traders. Retail traders also have access to leverage, giving them much more buying power on forex markets than they'd otherwise have. All this and it's easy to see why forex is such a non-stop market.

For beginners interested in forex, it pays to understand what you're getting into. While relatively straightforward, there are nuances traders need to understand. Let this be your basic guide to forex trading.

Currency trading is all done online through the forex market

What is Currency Trading?

Currency trading is often called forex (foreign exchange). Therefore, currency trading doesn't take place on a regulated exchange like stocks or commodities. Instead, it takes place on a global self-regulated exchange, between buyers and sellers of currency.

Those participating in forex can trade currency pairs. Every transaction on the forex market involves two currencies—or, the difference in value between those currencies. Base currency and quote currency form an exchange rate: the amount you pay to convert currency. Because the forex market is volatile, these rates change often.

The goal of forex trading is to leverage the relationships between currency pairs into returns over time. Traders "go long the pair" if they believe the base currency will grow stronger. Conversely, they'll "go short the pair" if they believe the base currency will fall. Currencies are priced out by four decimal points, called pips. Traders monitor the bid-ask spread of currency pairs and trade based on changes in pips.

How Does The Forex Market Work?

Forex is self-regulated by currency buyers, sellers and traders. While the volume of trades and significance of exchange are the main drivers of liquidity in the market, there are many global factors that affect currency prices themselves. For example, some of the biggest include:

Economic instability in countries
Political or monetary policy
Interest rates and inflation
GDP, including imports and exports

These factors influence the value of currencies relative to others they're paired with. For instance, if a country lowers interest rates and increases imports, their currency value is liable to rise. This opens the door for specific types of forex trading, such as currency carry trades.

Currency as an Asset

When you trade forex, you're not actually converting USD to JPY or GBP. Instead, forex is purely speculative. You're trading the volatility of the relationship between two currency pairs.

Take EUR/USD for example. If the United States appears to be headed for a recession, you might go long, betting that the exchange rate could move more in favor of the EUR. If it does, your return is equal to the investment vs. pip change in the bid-ask quote. All of this happens on the computer—you haven't actually moved currency around. It's all about credit agreements.

Most retail traders trade micro- and mini-lots. This is representative of 1,000 and 10,000 lots of base currency.

The Benefits of Forex Trading

Forex trading benefits from great liquidity. With almost 24-hour trading, five days-a-week and low average time in positions, forex is the most liquid investment market in the world. There are trillions exchanged daily and constant fluctuations in bid-ask prices. It means there's always opportunity for traders. This availability is also a benefit, since traders can trade at their leisure.

While no regulation sounds like a con, it's actually a big benefit for forex traders. A decentralized market is safeguarded from disruption and surprises. There's also inherent stability in trading something as large as currency. Unlike a stock—which can shed value due to one piece of bad news—currencies are much more stable. Movement of more than a few pips is rare.

Leverage is also easier to come by in the forex market. Traders aren't restricted to FINRA equity standards. It's easy to leverage micro and mini lots into powerful buying opportunities. And, there's plenty of volatility within the major currency pairs to sustain all types of trading at all hours.

Risks Associated With Currency Trading

Currency trading is often dominated by brokers. This means there's a lack of transparency for retail traders. Retail traders may not get the best prices or have their orders filled in the way they want. That said, there are regulations that brokers must abide by. Even in an unregulated market, broker actions are still subject to financial regulation.

The other issue that many new forex traders encounter is the risk of leverage. Forex markets operate with 50:1 leverage. While this amplifies buying power, it can also open traders up to bigger losses and more risk. Capital allocation is a must-have skill. And risk management is paramount. This, coupled with high volatility across global markets, can make for a jarring introduction to currency trading.

The Bottom Line

Currency trading on the forex market is a great way to get involved in investing. The simplified, straightforward concept of trading currency pairs is easy for beginners to grasp. Moreover, high liquidity and leveraging ability makes it perfect for retail investors.

Speculators and technical investors alike will find a home in forex. The volatility associated with this market offers opportunities for everyone. And, with 24-hour trades available five days-a-week, there's consistent trade activity.

And you can build a wealthy lifestyle through currency investing. To learn more, sign up for the Liberty Through Wealth e-letter below. This FREE newsletter will help you discover the latest wealth building strategies and investment opportunities.

Forex moves fast, which can scare new investors. The upside is, it's easy to learn in real-time. Eventually, that quickness becomes an asset. And, because there are no insiders in the forex market, anyone can find success if they take the time to learn.

FOREX-Dollar finds footing on U.S. economy as euro falters - Investing.com India

Posted: 28 Mar 2021 10:40 PM PDT

* Dollar inches higher in Asia; EUR and JPY near major lows

* AUD, NZD begin to hand back small Friday gains

* Graphic: World FX rates https://tmsnrt.rs/2RBWI5E

By Tom Westbrook

SINGAPORE, March 29 (Reuters) - The dollar began the week on a firm footing, inching toward a milestone peak against the euro on Monday, as a cautious market mood pushed investors to safety while U.S. economic strength and a rapid vaccine rollout also added to the greenback's shine.

The euro was down 0.1% in the Asia session at $1.1783, not far above last week's four-and-a-half-month trough of $1.1762 and well below its 200-day moving average of about $1.1866.

The common currency is headed for its worst month since mid-2019 as Europe's faltering vaccination programme runs into a wave of new infections, a bearish signal as positioning data shows investors remain heavily long euros. 0#NETUSDFX=

"The euro has continued to fall ... even as long-term U.S. yields have lost some upward momentum," analysts at MUFG Bank said in a note. "It suggests euro weakness was driven more by concerns over the weakening outlook for growth in the eurozone in light of rising COVID cases."

Virus-driven caution also helped the dollar higher against the Australian dollar, New Zealand dollar and sterling and it rose against oil-liked currencies as the re-floating of the ship blocking the Suez Canal pushed crude prices down by about 1.5%.

Concern in equity markets at the widening fallout from a wave of liquidations linked to investment fund Archegos Capital also put investors in a careful mindset.

Only the safe-haven Japanese yen made headway, scraping from a 10-month low it made on Friday to inch about 0.2% higher to 109.43 -- though along with the Swiss franc it remains at the bottom of the G10 leaderboard this year.

Over the quarter, the dollar has posted a 0.7% loss on the pound, which has been supported by Britain's speedy vaccination rollout, a 0.8% gain on the Australian dollar and a 2.9% gain against the , which has been hit by housing market reforms.

The yen, which is sensitive to gaps in returns on U.S. and Japanese government debt has fallen about 5.7%, its worst quarterly performance since late 2016, while the franc is down 5.8% for its worst performance since the third quarter of 2014.

This year's 76-basis-point rise in benchmark 10-year Treasury yields - as the U.S. economy rebounds - has been a large driver, as the better returns offer carry for investors who can borrow the yen and franc very cheaply.

The AUD=D3 was last down 0.3% at $0.7621 on Monday and the New Zealand dollar NZD=D3 had dropped 0.3% to $0.6978, while sterling slipped 0.2% to $1.3767.

"The U.S. is also being helped on its own by some pretty good economic data, fantastic rollout of vaccines, good pace of vaccination and (positive) stock markets," said Westpac currency analyst Imre Speizer.

"The domestic economy is doing better than expected and likely to be the case for the next few months, so that might hold the U.S. dollar up and that's what's caused the Aussie, kiwi and emerging-market currencies to pullback in March."

U.S. jobless claims fell to a one-year low last week and President Joe Biden said he would double his vaccination goal, after surpassing 100 million shots 42 days ahead of schedule.

In contrast, European inoculations have been hit by supply problems and safety concerns.

Investors are looking ahead to Purchasing Managers Index figures due midweek and for some details of Biden's infrastructure spending plan. However the main data will be U.S. hiring figures due on Good Friday.

"The distribution of forecasts range from 460,000 to 1 million (jobs), where the whisper number sits at the top end of the range," said Pepperstone's head of research, Chris Weston.

"One million jobs would set the reflation trades alight ... and cause a solid sell-off in bond yields taking USD/JPY and higher," he said. "The euro should push through last weeks lows of 1.1761 and towards 1.1690."

========================================================

Currency bid prices at 0527 GMT Description

RIC

Last

U.S. Close Pct Change

YTD Pct

High Bid

Low Bid

Change

Session

Euro/Dollar

EUR=EBS

$1.1777

$1.1794

-0.14%

-3.61%

+1.1795

+1.1775 Dollar/Yen

JPY=D3

109.4200

109.6650

-0.23%

+5.93%

+109.7950 +109.3950 Euro/Yen

EURJPY=

128.86

129.33

-0.36%

+1.53%

+129.4200 +128.8500 Dollar/Swiss

CHF=EBS

0.9395

0.9393

+0.03%

+6.20%

+0.9402

+0.9395 Sterling/Dollar GBP=D3

1.3768

1.3799

-0.23%

+0.77%

+1.3799

+1.3766 Dollar/Canadian CAD=D3

1.2621

1.2571

+0.41%

-0.88%

+1.2627

+1.2578 Aussie/Dollar

AUD=D3

0.7623

0.7642

-0.25%

-0.90%

+0.7645

+0.7619 NZ

NZD=D3

0.6979

0.7000

-0.29%

-2.81%

+0.6995

+0.6975 Dollar/Dollar

All spots FX= Tokyo spots AFX= Europe spots EFX= Volatilities FXVOL= Tokyo Forex market info from BOJ TKYFX

<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ World FX rates

https://tmsnrt.rs/2RBWI5E

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>

Why Is Forex Trading So Popular? - NuWireInvestor - NuWire Investor

Posted: 17 Mar 2021 02:56 PM PDT

Over the years, forex trading has become increasingly popular with people from all walks of life. There are many people who have been involved with this type of trading for many years, and others who are completely new to it. This is a global market and a type of trading that people participate in around the globe. There are also many resources to help those who want to trade such as demo accounts and forex brokers, which you can find out more about here.

For those who are interested in finding a means of investing money, forex is often one of the first options. Even those who know little about forex often decide to invest after doing some research and trying it out for themselves using demo accounts. There are many benefits of forex trading and many reasons why it has become such a popular choice. In this article, we will look at why forex trading has become so popular.

What Are the Benefits of This Type of Trading?

There are many benefits that have made forex trading such a popular choice with investors from a wide range of backgrounds. Some of these are:

Global Market with Plenty of Opportunities

One of the reasons behind the popularity of forex trading is that it is a global market with people trading around the world. Each day, trillions of dollars are exchanged, and this can be done at all hours of the day or night. So, this means that there are plenty of opportunities for investors and lots of scope when it comes to making money and increasing wealth.

Easy to Get Into

Another benefit is that this is an easy type of trading for beginners to get into. First off, the initial costs are not high, so this means that you can try forex trading even if you do not have lots of spare cash that you can put at risk. In addition, you can get to learn all about forex trading with demo accounts that can be accessed with ease online. So, it is easy to enter forex trading, and you do not have to worry about huge investments.

Around the Clock Trading

Many people like the fact that forex trading is around the clock, and this is because it is a global market. This is ideal for those who want to get involved in trading but also want some level of flexibility. A lot of people like the fact that there are rolling hours where transactions can take place somewhere across the globe.

Low Costs Involved

The low costs involved in forex trading is another factor that many find appealing. You do not have to make huge transactions, and you can learn how to trade on demo accounts free of charge. In addition to this, the transaction costs on trades are pretty low, and this is another financial benefit that traders can look forward to.

These are just a few of the reasons why forex trading has become so popular.

Credit Suisse Hit With Extra EU Antitrust Charges in Forex Probe - U.S News & World Report Money

Posted: 22 Mar 2021 07:04 AM PDT

[unable to retrieve full-text content]Credit Suisse Hit With Extra EU Antitrust Charges in Forex Probe U.S News & World Report Money

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