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TRADING #101 COURSE – PART II TWO: SUCCESSFUL TRADING PIE – WWW.TRADERSCOACH.COM

Forex

The forex market is currently the largest and most liquid market in the world. According
to the Bank for International Settlements, the preliminary global results from the 2016
Triennial Central Bank Survey of Foreign Exchange and OTC Derivatives Markets
Activity show that trading in foreign exchange markets averaged $5.09 trillion per day in
April 2016.
And this bustling market is trading 24 hours per day most days of the week worldwide.
Basically, when one currency market is closing another one is opening.
See Table 10.12 for the major currencies that are traded.

You will notice that each currency is identified by its ISO code which is designated by
the International Standardization Organization, ISO. For example, the United States
dollar has an ISO code of USD.

Table 10.12 Forex Major Currencies

Country Currency Name ISO Code
United States U.S. dollar USD
Eurozone Euro EUR
Canada Canadian dollar CAD
Japan Yen JPY
United Kingdom Pound sterling GBP
Switzerland Swiss franc CHF
Australia Australian dollar AUD
New Zealand New Zealand dollar NZD

This table is intended for educational purposes only. Information is subject to change. Readers are advised to consult
with their broker or data provider for current information.

Source: https://en.wikipedia.org/wiki/Foreign_exchange_market

Another benefit to the forex market is the exceptional leverage available. A trader with
$1,000 in an account can control a position of $100,000, which is referred to as having
100:1 leverage. Use caution when implementing leverage and apply risk control to
manage your trade size.

Trading Currency Pairs

The major currency pairs all involve the U.S. dollar on one side of the trade, such as
AUD/USD. (See Table 10.13.) The U.S. dollar is the central currency against which
other currencies are traded. In a recent triennial survey of the global foreign exchange
market in 2016, the Bank for International Settlements (BIS) found that the U.S. dollar
was on one side of 80 percent of all reported forex market transactions.

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