Forex Trading

FOREX History (Part IV)

In 1972, European countries (West Germany, France, Italy, the Netherlands, Belgium and Luxembourg) have established the European Joint Float, how can they have gained independence from US dollar. Short time after that (almost 2 years) up to 1973, the both agreements have showed the same sign of “illness” as Bretton Woods accord. Those times, because no new solutions and ideas for new agreements could be made and replaced, coming the time knows as time of creating and beginning the free-float system, which system, we have these days.

In this time up to 1978, when the free-float system was official established, government were paged their currencies to freely fluctuation, only depend from ask and bid in open market. The final step to get independence from USD, former European community has created European Monetary System in 1978. The main rule was managing value of their currencies and intervenes if they fluctuated above some level, but 15 years later, in 1993, the European Monetary System collapsed when and GBP was attacked by currency traders and following with stepped out by British government from European Monetary System … 

...And real FOREX was born free and open.…continue with new artical: Investment Strategies: Technical and Fundamental Analysis

FOREX History (Part III)

The first official changes in foreign exchange market (FOREX) have been made in Bretton Woods, New Hampshire in 1944, when victory countries alliance in WWII (United States, Great Britain and France) have tried to establish a new economic circumstances and relations in entire world, known as Bretton Woods accord. On this meeting U.S. dollar became “measurement” currency, which other nations measure their currencies; such was Japan and Germany to help them to rebuild they economy and to bring stability in global economic situation. This standard to use a fix currency against smaller market was the main reasons for failure of this accord, but it did stabile economy in Europe and Japan.

In 1971 the Bretton Woods Accord was replaced by the Smithsonian Agreement. The small, but main different between accord and agreement was allowing for increasing the fluctuation range in currency rates.…continue

FOREX History (Part II)

On FOREX markets buying and selling currency is made on a speculative basis by most traders. It is the same like stock market, when traders buy (stocks) currencies holding to get stronger and sell when will get weaker. Most of this trading is doing by investment companies, hedge fund, banks and brokerages. In last couple years the currency trading became open for individual investor with small financial steak. Companies use the currency market for purchasing some amount of foreign currency for there obligations and commitments with other international companies.

The short retrospective for foreign exchange market life will be:

Currency markets were relatively quite until World War 1. Speculation ever made was unknown and was with negative sentiment by institutions. After war ending foreign exchange markets became volatile and shows the first signs of speculative activity, but any further changes and progress was interrupt with great depression. The forex markets were quiet and stable during World War II, when the market started with many important changes and improvements. …continue

FOREX History (Part I)

The foreign exchange market (FOREX) is the largest financial market in the world. Currencies daily trading is more than 2 trillion dollars, which is more or less bigger capitalization of total stock markets world wide.

The currency trading duration is 24 hours six days a week. Trading begins in Wellington and Sydney, continuing in Japan, Hong Kong, and Singapore, know as Asian trading session, coming in European trading session in London, the place No. 1 world currency trading and “ending” with American session in New York, when it is starting again in Asia due to time difference. The currency trading is only close from Friday 4 p.m (EST) or 8 p.m (GMT) until Sunday 5 p.m (EST) or 9 p.m (GMT) with opening bell.

…The charm and challenge of currency markets are their great volatile. The main reason for this is the size and sensitivity of the market. Many variables affect currencies, such as economic environment, domestic and international politics, weather conditions , war crisis and many different situations even though in first moment it seems no reasons for it. Some times happens and illogical fluctuations, when one currency causes another to weaken despite a good economic conditions in that country.…continue