The Basics Of Forex.

For all those who have recently heard the word Forex, but have already learned about what it means, this article describes the basic terms and concepts. In addition, within the framework of the blog, another article is written, in which you can get acquainted with the most common speculation and rumors about the stock exchange game and earnings on Forex. But back to the basics…

Analytics and financial topics are now at the peak of recovery.To work and earn additional revenue in the forex industry, you need to contact trusted brokers,one of which is delta market, which have proven to be good reviews.

Quotation

To begin with, the value of any currency on Forex is equal to the US dollar. This relationship is called “quote”. So, if you are offered 1.29 units of “US dollar” for one unit of the currency “euro”, it means that the Euro/Dollar quote is 1.29. The same can be said about currency pairs, the Yen/Dollar, Pound/Dollar, etc.

Volatility

In addition, there is the concept of currency pair volatility — the faster the quote changes, the higher the volatility of the currency pair is considered. The thing is that you can make money on forex only by changing the quotes of currency pairs.

If you correctly guess the price change, then this is exactly what you can earn. For example, buy euros at 1.29, and then sell at 1.32 and “put the difference in your pocket”. So, if the price does not change for a long time, then there will be no earnings all this time, too. Accordingly, the higher the volatility of the currency pair, the more interesting it is to work.

Bulls and bears

From the second concept — “market volatility” comes the third concept of the market: the game “on the decline” or “on the rise”. So, for the currency pair that has high volatility and is interesting for us to work with, you need to guess the direction of price movement. If we assume that the price will rise, it is necessary to buy this currency now in order to sell it more expensive in the future.

If we assume that the price will fall, then it is necessary to make a deal to “sell” such a currency pair. At the same time, we undertake to buy as much currency in the future as we sell now. We assume that the quotes for this pair will decrease and then we will buy this currency cheaper than we sell it now — and we will earn money on this.

The game of raising the price of a currency pair, in the jargon of traders, is called a “bullish” game, similar to a bull that raises the victim (in this case, the price) on its horns. The short game is called “bearish” – like a bear piling on top of its prey. Accordingly, those stock market players who prefer to play ” up “are called “bulls”, and those who are more interested in” down ” quotes are bears.

Technical and fundamental analysis

Predicting the price movement is quite a difficult task for a beginner. More experienced traders know the axiom that the current price already includes all the factors that affect it.

Accordingly, after analyzing the chart of quotations, it is possible to predict the next price value with a certain degree of probability, within certain limits. Such an analysis of quotations is called “technical”. There is enough literature devoted to technical analysis that describes both the basics of analysis and specific methods and techniques.

Another way to determine the price is based on various economic and political news, events in the world. This is a fundamental analysis that is most often used by traders who open “long” positions-transactions designed for long-term profit.

In general, for successful trading on the Forex market, you need the ability to use both technical and fundamental analysis at the same time.

Perhaps, the basic concepts of the Forex market end there. All other terms require more in-depth study and “do not fit” into the format of this article.