Technical Analysis

Basic Forex forecast methods:

Technical analysis and fundamental analysis

This chapter and the next one provide insight into the two major methods of analysis used to forecast the behavior of the  Forex market.  Technical analysis and fundamental analysis differ greatly,  but both can be useful forecasting tools for the  Forex trader. They have the same goal - to predict a price or movement.  The technician studies the effect, while the fundamentalist studies the causes of market movements.

Training for success

Understanding the nuances  of the  Forex market requires experience and training, but is critical to succes.  In fact,  ongoing leraning is as important to the veteran trader as it is to the beginner.   The foreign currency market is massive, and the key to succes is knowledge.   Through training, observation and practice, you can learn hoe to identify and understand where the forex market is going, and what controls that direction.

Overview of trading Forex online

How a Forex system operates in real time

Online foreign exchange trading occurs in real time.  Exchange rates are constantly changing, in intervals of seconds.  Quotes are accurate for the time they are displayed only.  At any moment a different rate may be quoted.  When a trader locks in a rate and executes a transaction, that transaction is immediately processed; the trade has been executed.

Up-to-date exchange rates

As rates change so rapidly , any Forex software must display the most up-to-date rates.  To accomplish this, the Forex software is continuously communicating with a remote server that provides the most current exchange rates.  The rates quoted , inlike traditional bank exchange rates,  are actual tradable rates.  A trader may choose to "lock in" to a rate (called the "freeze rate") only as long as it is displayed.

What is the global Forex market?

Today, the forex market is a nonstop cash market where currencies of nations are traded,  typically via brokers.  Foreign currencies are continually and simultaneously bought and sold across local and global markets.   The value of traders investment increases or decreases based  on currency movements.  Foreign exchange market conditions can change at any time in response to real-time events.

The main attractions of short-term currency trading to private investors are:

What is Forex trading? What is a Forex deal?

What is Forex trading? What is a Forex deal?
The investor's goal in   Forex   trading is  to  profit   from   foreign   currency movements.

 More than 95% of all Forex trading performed today is for speculative purposes (e.g.  to   profit   from   currency   movements).   The   rest   belongs   to   hedging (managing business exposures to various currencies) and other activities.

Forex? What is it, anyway?

The market
The currency trading (foreign exchange, forex, fx) market is the biggest and fastest growing market on earth. Its daily turnover is more than 2.5 tirilion dollars. The participants in this market are central and commercial banks, corporations , institutional investors, hedge funds, and private individuals like you.

What happens in the market?
Markets are places where goods are traded, and the same goes with forex. In forex markets, the 'goods' are the currencies of various countries (as well as gold and silver). For example, you might buy euro with US dollars, or you might sell Japanese Yen for Canadian dollars. It's as basic as trading one currency for another.