Tuesday, May 15, 2007

Forex market offers opportunity and information

By Jay Moncliff

The forex market is what is called an international exchange currency market, where currencies are exchanged on a daily basis. There are five forex market centers around the world – New York, London, Tokyo, Frankfurt and Zurich. One does not need to be on the trading floor, so to speak to be involved in the forex market. Today, forex trading can be done from home on a computer.

The forex market itself is basically a worldwide connection of traders, who make investment moves based on the price of currencies, or their values relative to other currencies. These traders constantly negotiate prices with other traders resulting in the fluctuation or movement of a currency’s value. The value of a currency on the forex market also corresponds with supply. If there is greater demand for the Euro, let’s say, then there will be less supply of it on the forex market, which means, in time, it will make a Euro more valuable compared to let’s say the dollar. In short, in this forex market situation, one Euro would yield more dollars, subsequently weakening the dollar as well. Analyzing the forex market’s fluctuations allows investors to make predictions on how a currency will move in relation to another currency. They then can make predictions and buy and sell currency accordingly.

While some people view the forex market as a place to see what their exchange rate will be when they travel abroad, others view it as an opportunity to make great gains in their financial planning and future.

Jay Moncliff is the founder of http://www.forexadvise.info. Updated daily blog focusing on the latest Forex news, resources. Get the latest alerts and articles in his site:forex signal.

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Saturday, May 5, 2007

Forex Trading - How Exactly Does the Forex Market Work?

By Nathan Pennington

The forex market is like an onion. It has many layers. These layers are hidden by the layers above it. Let's peel the onion and see what we find.

The top layer is the retail trader. That's you and me. We're the surface. When you look at the forex market, we are what you see. One might assume that we're the ones who drive the market. We're not. Let's peel down a little further . . .

Next you have all the "real" currency transactions. These are the travelers that go back and forth from country to country. They need money exchanged. That's real currency trading. ;-)

The other (even larger) currency trading happens between companies. Companies are constantly selling and buying between countries for various reasons. Currency needs to be converted in these cases as well.

Peeling down further.

Here are the huge traders. These are hedge funds, pension funds, very high net worth individuals (Warren Buffet). These guys are almost completely hidden. They lurk. Slowly they buy or sell, never all at once. But the onion has yet another layer. These individuals are still not the real deal. Even they do not have control of the market.

Here we have reached the core. These are real. These mark the market do what they want. They actually control it . . . who are they?

The central banks. They control money flow, interest rates, and some things hidden from the public's eye. They are the ones who make the currency market do as they want it to do.

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Nathan Pennington is a forex trader and the author of Winning Forex Trading -THE Definitive Guide

Article Source: http://EzineArticles.com/?expert=Nathan_Pennington