global forex trading

Global Forex TradingBy

www.TheForexNittyGritty.com

http://www.theforexnittygritty.com/

It is possible to engage in global Forex trading as the three major currency markets are London, New York, and

Tokyo.

http://www.theforexnittygritty.com/forex/global-forex-trading




Trading during business hours at these three exchanges gives nearly twenty-

four hour a day access to foreign currency trading.


http://www.theforexnittygritty.com/forex/foreign-currency-trading




In all of the major markets one can trade all currencies.





However, it is commonly not possible to trade many of the minor Forex currencies against each other.





Many of not most of the minor Forex currencies are traded one against the

US dollar and then the US dollar is traded against the second currency.





In trading Forex markets a trader chooses New York, Tokyo, or London based on his working hours and to a

degree on the currencies that he trades.


http://www.theforexnittygritty.com/forex/trading-forex-markets




For example, news that is germane to the Yen and AUD will commonly break

during trading hours in Tokyo while news that affects the Euro, Swiss franc

or Pound will break during London hours.





North American news affecting the CAD and USD will break during New York

hours.





Volatility Leads to Profits





Currency speculators look for volatile markets in global Forex trading.





Profits occur when a trader correctly anticipates prices changes in any given

currency pair.





Global Forex trading allows traders to buy and sell currencies that are actively

trading and whose prices are fluctuating.





Traders engage in technical analysis of minor Forex currencies

and technical analysis of major Forex currencies as a means of predicting when to make

a profitable trade.http://www.theforexnittygritty.com/forex/global-forex-trading

http://www.theforexnittygritty.com/forex/technical-analysis-of-minor-forex-currencies

http://www.theforexnittygritty.com/forex/technical-analysis-of-minor-forex-currencies

http://www.theforexnittygritty.com/forex/technical-analysis-of-major-forex-currencies

http://www.theforexnittygritty.com/forex/technical-analysis-of-major-forex-currencies




Because major pairs trade in higher volume and with greater liquidity than

minor pairs, technical trading is typically more accurate with these

currencies.





On the other hand a trader who is more knowledgeable about the fundamentals

of a minor currency may benefit from his expertise niche while the general

run of traders will be caught unawares by changes in a given minor currency.





Options in Global Currency Trading





Often traders can profit by trading currency options.


http://www.theforexnittygritty.com/forex-trading/trading-currency-options




Options are a way to leverage trading capital and a way to hedge risk.





When purchasing an options contract on a currency pair a trader pays for the

right to execute the contract if and when doing so is profitable. He is under no

obligation to do so.





As such he does not buy or sell a currency but rather pays for the option

to do so.





A call option gives the buyer the right to buy one currency with another and a

put contract gives the buyer the right to sell one currency for another.





Options in global Forex trading allow the trader to stake out a position but not

tie up trading capital.





Options also allow a trader to take speculative positions. In a volatile

market a long shot position may turn out to be very profitable and may turn

into a huge loss if the trader buys or sells currency and waits for events to

take their course.





When he buys options the trader only stands to lose the price of the options

contract and thus limits big losses while waiting for big gains.





global forex trading

Economy & Finance