Forex Trading Advice – The Advantages and Disadvantages of the Foreign Exchange Market

Forex Trading Advice, Money, Advantages

The forex market is an open-market where currencies are traded. Currency prices are influenced by various macro forces, such as interest rates, central bank policy, economic growth, and political environment.

Money

The foreign exchange market (FX market) is one of the world’s largest and most liquid markets. It is also a major source of income for many people.

Advantages

The Forex market is a decentralized, liquidity-rich and highly regulated market. This allows traders to participate in the market without having to put up large amounts of their own cash.

Forex is also unique in that it opens almost 24 hours a day, 6 days a week – from Sunday to Friday. It is a global market and therefore is responsive to any changes in market conditions or economic events.

Trading styles

A trader’s trading style and method of entering and exiting the market is important to success in forex. Successful traders use different strategies based on their specific trader personality and the type of risk they are willing to accept.

Trading sessions

The forex market has three main trading sessions – the Asian, London and New York sessions – which are characterized by their high volume of transactions. When these sessions overlap, the markets become even more volatile and active.

Identifying when the markets open and close is an important aspect of organising your trading strategy and style. This will help you minimise the chances of missing a good trading opportunity or losing your profits because of increased market volatility.