Forex trading certainly

Forex trading certainly can be quite risky, but it doesn't have to be. With a strong risk management system you can trade these with the same risk as trading Microsoft or General Electric. Some of the most profitable trades in history were a result of forex trading. Remember George Soros breaking the Bank of England when he shorted roughly 10 billion in British Pounds.

forex, global currencies, currency trading The currency market is the world's single largest market. It is larger than all global stock markets combined, the commodity markets, or even the interest rate markets. Currencies can be traded through the Interbank market or in the futures market.

To keep the rather complex topic of forex trading as simple as possible I am only going to address the Interbank market on this page.

This market will enable you to trade many curencies, such as: the U.S. dollar (USD), Canadian dollar (CAD), Euro (EUR), British Pound (GBP), Australian dollar (AUD), Mexican Peso (MXP), Swiss Franc (CHF), Swedish Krona (SEK), Norwegian Krona (NOK), Hong Kong Dollar (HKD), Brazilian Real, and others.

By the nature of this market if you are buying a currency you are selling another. For example, if you buy the Euro, you must be buying it in relation to another currency. If you think the Euro will appreciate compared to the U.S. dollar you would buy the EUR/USD (euro/u.s. dollar). This currency relationship I gave of the EUR/USD is called a cross, a currency cross, or a cross rate.

Currencys and cross rates move in increments of a "pip" (stand for price interest point). It's just what it's called. If a cross is quoted at 1.5487 then a movement of .0001 would be one "pip". Almost all of the cross rates have four digits to the right of the dicimal, however, crosses containing the Yen have two places (i.e. 104.87).

In order to buy or sell a currency cross you need to know how much a one "pip" move will cost you in U.S. dollars. This is the most important part of currency trading-and the part that I spent the most time understanding cold.
There are many great sources for forex trading charts that one can buy. There are a few online sources that aren't quite as good but will certainly suffice.