HOW DOES FOREX WORK?

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Symbol Bid Ask Spread
EURUSD 1.18567 1.18597 3
GBPUSD 1.37961 1.38094 13.3
USDCAD 1.24626 1.24752 12.6
USDJPY 110.142 110.338 19.6
USDCHF 0.92190 0.92378 18.8
AUDUSD 0.74810 0.74892 8.2
NZDUSD 0.69318 0.69454 13.6
EURGBP 0.85874 0.85933 5.9
EURCHF 1.09350 1.09550 20
EURJPY 130.645 130.832 18.7
AUDJPY 82.429 82.616 18.7
GBPJPY 152.012 152.335 32.3
USDSGD 1.34361 1.34702 34.1
XAUUSD 1763.57 1763.89 32
XAGUSD 25.796 25.828 3.2

The above live prices are provided solely for informational purposes, not for trading purposes, and may be delayed.

This is how forex work.

  • Forex trading is the simultaneous buying of one currency and selling of another
  • Two currencies make up what is known as a “currency pair”. For example the euro and the U.S. dollar (EUR/USD) or the British pound and the Japanese yen (GBP/JPY).
  • Currencies are always traded in pairs – each currency is represented by three letters
  • The first two letters represent the country and the third letter identifies the currency
  • Forex pairs are read in the opposite direction of mathematical proportions or ratios

For example:
GBP/USD = 1.23450

The currency to the left of the slash (“/”) is called the base currency (in this example, the British Pound) and the currency on the right is called the quote currency (in this example, the U.S Dollar)

This notation means that 1 unit of the base currency (that is, 1 GBP) is equal to 1.23450 U.S Dollars

You have to pay 1.23450 U.S Dollars to buy 1 GBP

If selling, the foreign currency exchange rate specifies how much units of the quote currency you get for selling one unit of the base currency

In the above example, you will receive 1.23450 U.S Dollars when you sell 1 GBP.

The list below are the most liquid and widely traded currency pairs in the world and are called major pairs.

CURRENCY PAIR COUNTRIES FX GEEK SPEAK
EUR/USD Eurozone / United States “euro dollar”
USD/JPY United States / Japan “dollar yen”
GBP/USD United Kingdom / United States “pound dollar”
USD/CHF United States/ Switzerland “dollar swissy”
USD/CAD United States / Canada “dollar loonie”
AUD/USD Australia / United States “aussie dollar”
NZD/USD New Zealand / United States “kiwi dollar”

   

When to Buy?

A trader would open a buy position if they believe that the value of that specific base currency would increase.

When to Sell?

A trader would open a sell position if they believe that the value of that specific base currency would decrease.
  

Trading sessions according to GMT (Greenwich Mean Time):

Region City Open(GMT) Closed(GMT)
Europe London 8:00 am 5:00 pm
America New York 1:00 pm 10:00 pm
Asia Tokyo Midnight 9:00 am
Pacific Sydney 10:00 pm 7:00 am

  

Trading sessions according to EST (Eastern Standard Time):

Region City Open(EST) Closed(EST)
Europe London 3:00 am 12 noon
America New York 8:00 am 5:00 pm
Asia Tokyo 7:00 pm 4:00 am
Pacific Sydney 5:00 pm 2:00 am

 

Trading hours may vary with daylight savings time.