WORLD OF FOREX

 Unlocking the World of Forex Trading: A Beginner's Guide

Welcome to our blog, where we embark on a journey through the dynamic realm of forex trading. Whether you're a curious newcomer or a seasoned investor looking to refine your skills, this space is designed to provide you with invaluable insights, strategies, and resources to navigate the complexities of the foreign exchange . 

Forex trading can sound intimidating if it is the first time you are looking at a currency exchange chart. There is a lot of jargon involved that you need to understand before placing a trade. Nevertheless, the truth is that anybody can have access to trade currencies and make a profit. 

So, what is forex trading? It’s the discipline of exchanging international currencies, which are traded against one another in pairs. Transactions take place in the forex (also known as foreign exchange or FX) market. 

When you travel abroad and swap currency for local use, you’re already participating in the global forex market. But did you know that the foreign currency market trades a daily volume of more than $5.1 trillion? Maybe you are wondering what concepts you need to learn to trade FX like a pro. We’ve got your back! By the end of this guide, you will have a better understanding of the forex basics and the ability to read forex charts.

example below shows one day in the example below. These levels are:

O – Open price

H – High price 

L – Low price

C – Close price

The Candle or Candlestick chart

This is the most commonly used chart type amongst all traders.

Shows: Highs, lows, opening, closing prices

How to read: A vertical body (candle) denotes the open and closing prices. It is pierced through with a vertical line (shadows) that indicates the highs and lows in the period. 

Colors are very important here: A red or colored bar tells that a currency pair closed lower than the opening price. A green or transparent bar represents the opposite. 

The Line Chart

Shows: Closing prices

How to read: A line connects a series of data points on the chart, all of which represent only the closing prices. This chart is mainly used to analyze day-to-day price changes. 

Chart timeframes

It is important to clarify that you can select and analyze different timeframes in a chart. Each bar, candle, or point in a line chart can represent different time units:

Timeframes Charts available

Minutes 1 Minute Chart (M1), 5 Minutes Chart (M5), 15 Minutes Chart (M15), and 30 Minutes Chart (30M).

Hours 1-hour chart (1H) or 4-hour chart (4H)

Daily Daily chart or 1D

Weekly Weekly Chart or W1

Monthly Monthly Chart or Mn

When is the forex market open?

Financial centers are comprised of banks, investment management firms, forex brokers, hedge funds, and investors. Therefore, forex pairs are traded 24 hours from Sunday 10:00 PM GMT to Friday at 10:00 PM GMT. The New York market starts trading right as the Australia market closes.