Forex (Foreign Exchange) is the global marketplace for trading currencies. It involves buying one currency while simultaneously selling another, profiting from the exchange rate fluctuations.
Currency Pairs
Currencies are always traded in pairs. The first currency is the base currency, and the second is the quote currency.
Major Pairs
EUR/USD (Euro vs US Dollar)
GBP/USD (British Pound vs US Dollar)
USD/JPY (US Dollar vs Japanese Yen)
USD/CHF (US Dollar vs Swiss Franc)
Cross Pairs
EUR/GBP
EUR/JPY
GBP/JPY
AUD/USD
How Forex Trading Works
Choose a Broker: Open an account with a regulated forex broker
Fund Your Account: Deposit money to start trading
Analyze the Market: Use technical and fundamental analysis
Place a Trade: Buy or sell currency pairs
Monitor and Close: Watch your position and exit when profitable
Market Hours
The forex market operates 24 hours a day, 5 days a week. Trading sessions:
Sydney: 10:00 PM - 7:00 AM EST
Tokyo: 7:00 PM - 4:00 AM EST
London: 3:00 AM - 12:00 PM EST
New York: 8:00 AM - 5:00 PM EST
Key Fact: The forex market is the largest financial market in the world with daily turnover exceeding $6 trillion.
Lot Sizes
Standard Lot: 100,000 units of base currency
Mini Lot: 10,000 units
Micro Lot: 1,000 units
Nano Lot: 100 units
Currency Pair Calculator
Forex Terminology
Pip: Smallest price movement
Leverage: Borrowed money for trading
Margin: Collateral for leveraged trades
Spread: Difference between buy/sell price
Risk Warning
Forex trading involves substantial risk of loss and is not suitable for all investors.