Interesting questions

How currency exchange market works?

Forex is the only market in the world which is working 24h/5days in a week, there are four regional markets: Australian, Asian, European and American. The speed in completing transactions, very little costs, and high liquidity, all these factors make this market more Exciting circulation markets for its clients. It is composed simply of a global network linking tremendous number of currency traders worldwide. There is no traditional Bourse known in sense of the word.





What are the currencies symbols?

USA Dollar (USD)
Union Euro (EUR)
Pound sterling (GBP)
Swiss franc (CHF)
Japanese Yen (JPY)
Australian dollar (AUD)
New Zealand dollar (NZD)
Canadian dollar (CAD)





What is the meaning of the word couple?
Circulation of currencies in forex is done by couples. Example: Euro / dollar or dollar / yen. When you sell couple that’s mean you sell the first currency and buy the second in this couple. Most couples are:

EUR / USD
USD / JPY
GBP / USD
USD / CHF
EUR / GBP
NZD / USD
EUR / CHF
AUD / USD
EUR / AUD
CAD / AUD
CAD / JPY
EUR / JPY
GBP / JPY
CHF / JPY
EUR / AUD






What is spread?
Spread is difference points between sell and buy. It is usually ranges between 3 to 5 points (pips) in the main couples, and often differs from company to another. The amount of point vary from couple to another, (in example and in normal account), in GBP / USD couple the point amount is 10 dollars but in EUR / GBP it is little less than 20 dollars ;that’s mean when the price move you will win or loss 10 dollars for each 1 point change in couple price.





How can we predict the direction of prices?

Forecasting the correct direction of prices depends on the deep study of the market. Usually, we use three analytical Market types:

News analysis,
Technical analysis,
Psychological analysis

The thoughtful and proper combination of these three analyses is the guarantee for predicting the correct forex market directions.



News Analysis
This includes Economic, and political factors study, which might affect the currency market. For example, American Central Reserve Bank policies reports, economy transactions, the pronouncements and other important events. The goal of the analysis is to study the key factors and their impacts on the dynamics of prices in the forex market. The trader in the forex market always must be familiar with the current global situation.



Technical analysis
This is meaning the study of the market situation changes based on the previous prices. We Use in this analysis charts, which reflect price changes for a certain period of time. We also understand the general market situation at the present time; several indicators can predict price changes in the near future. The technical analysis based on the fact that the previous prices take all the factors that could affect the market - economic, political, psychological and other factors –, and the behavior of prices is the result of these decisions. The technical analysis gives a wealth of tools enable us to draw useful forecasts graphics for the prices. What is needed is the fact that the trader must know the price trend, I will show you later how you can know all directions of price only by use trend lines.



Psychoanalysis
Its mean Analyzing traders behaviors in the market, their psychological, expectations, hopes and fears. This kind of analysis is very important because it gives very high proportion of truth. We must not forget that behind the computer stations that give prices, humans and currencies prices depends on there behavior ultimately.