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Forex New - Understanding Forex Terminology

Apr 12, 2008
The Forex market is the absolute largest market in the world which accounts for over 2 trillion dollars traded daily. A little background about the forex market is it was once ruled by large multi-national corporations and large financial institutions for decades. They still do a majority of the 2 trillion dollars a day trading throughout the world daily. The single investor is on the rise though now in this market. The consumer (you) are now able to make a killing in today's society in this highly profitable market. Before you jump right into forex new trading you need to understand the basic terminology and fundamentals that will take your investing to the next level. It is essential that you learn as much terminology as you can and have a grasp on the current national and local problems around the world as they greatly affect this market.

Let's get started with the basics of forex trading. Everything in the forex market revolves in two's. When you buy currency you are buying it in multiples and selling it in multiples. There is also a base currency for all these multiple pairs. In the capital forex market for example, a EURO/USD = 2.5200 which means that 1 EURO is worth 2.5200 USD.

When you are starting out with currency trading also you will hear this term more than anything and ask this question. What is a pip? A pip is the smallest unit of price possible on any foreign currency that exists today. Most pairs of currencies that you will see when you start trading on the vast and highly liquefiable market will consists of 4 decimal places for example 0.0089.1 pip is the smallest unit of price for any foreign currency. Most currency pairs consist of 5 digits and the pip represents the smallest change in the fourth decimal place, ie 0.0001. There are a lot more terms out there than this, but these are the two main terms you need to quickly grasp on before proceeding in this market.

Day forex system trading happens all day long 24 hours a day no matter where you are in the world. Forex trading is open, that's right, 24 hours a day 5 days a week. This is particularly good for people doing this as a 2nd source of income around their regular 9-5 day job. Once you get the hang of forex trading you will no longer need to work at your boring and dull 9-5 day job. You will be living the life racking in millions of dollars like I have through simple, yet potent currency trading skills that I have learned through forex strategy and development. The skills that I have gained through the years are irreplaceable and have given me an edge on my competition. All this was made possible because of hard work and determination; it wasn't about my initial capital investment. The beauty of the forex market is, you do not need a lot of capital to start. $25.00 will get the job done!
About the Author
John Callingham has been teaching traders all over the world about forex new. His award winning course shows some of the best forex trading strategies in the industry. Learn more about John's course for FREE at http://www.ForexSimpleTrading.com
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