what is Forex

FOREX (FOReign EXchange market) - the international currency market, which is free money are bought and sold. In its present condition FOREX was launched in 1970, when they were introduced free currency exchange rates, the price of one currency against another is determined only by the participants of the market based on supply and demand.
In terms of freedom from external control and free competition are concerned, FOREX is a perfect market. He is also the largest and most liquid financial market. According to various estimates, the volume of the market constitute from 1 to 1.5 trillion. $ Per day (single trading platform does not exist and therefore an absolutely exact number is impossible). Transactions are conducted all over the world via telecommunications systems around the clock to 00:00 (GMT) Monday 22:00 (GMT) Friday. Practically in every time zone (that is, in Frankfurt, London, New York, Tokyo, Hong Kong etc.) there are dealers who will quote currencies.
FOREX - more objective market, because if participants would like to change prices to their advantage, they must operate with tens of billions of dollars, so the market impact of individual participants is almost completely excluded. The superior liquidity allows you to open and / or close positions within seconds. Hold time position is arbitrary and has no limits: from several seconds to many years and depends only on your trading strategies. Although the daily fluctuations of currencies are rather insignificant, but when you use the credit lines that are accessible even to currency speculators with small capitals in the $ 1000-5000, the profit may be impressive.
Consider an example. You have analyzed the market situation, came to the conclusion that the pound will go up against the dollar. Opening a lot for buying the pound (GBP) with 1% margin (leverage 1:100) at a price of 1.4989, you expect the growth rate. Some time later your expectations become true and you close the position 77 at 1.5050 and earn 61 pips (about $ 405). The calculation of 1 pip click.
Everyday fluctuations of currencies constitute about 100 - 150 points, allowing traders to make money on these movements.
In FOREX, it is not necessary at first to buy the currency to sell it later. Possible to open positions for buying and selling any currency without actually having it. Usually Internet-brokers establish the minimum deposit needed to work in the FOREX market a $ 2,000 and grant a leverage of 1:100. Thus opening the position at $ 100,000, a trader invests $ 1,000 and receives a loan of $ 99.000. The major currencies traded in FOREX, are Euro (EUR), Japanese Yen (JPY), Pound (GBP) and Swiss franc (CHF), all of them are traded against the U.S. dollar (USD).
In order to assess the situation on the market a trader must be able to use fundamental and / or technical analysis, as well as be able to operate in a constantly changing information about political and economic nature.
Most small and medium players in financial markets use technical analysis. Technical analysis assumes that all the information about the market and its further fluctuations is contained in the price range. Any factor influencing the price - economic, political or psychological - is already considered the market and included in the price. The initial data for technical analysis are prices - the highest and lowest prices, the opening and closing price for a certain period of time and volume of transactions.Technical analysis relies on three assumptions:

    movement of the market considers everything;
    Movement of prices is purposeful;
    History repeats itself.
Ie Technical analysis - a statistical and mathematical analysis of previous quotes and a prognosis of coming prices.
Fundamental analysis - an analysis of the economic situation in the country of the currency, political events and rumors. The country's economy depends on the level of inflation and unemployment,% rate of the Central Bank's fiscal policy. Political stability also influences the exchange rate. Special role played by Central Bank policy, as concentrated interventions or refusal from them greatly influence the exchange rate.
But at the same time, fundamental analysis should not consider as an analysis of the economy. A far bigger role in the FOREX market belongs to the expectations of market participants and their assessment of these expectations. Strong influence on the expectations of market participants have different prognoses and bulletins, issued by market participants. Often a situation where an effect of "self-fulfilling prophecy," when market players raise or lower the exchange rates according to the forecasts. But a deep and thorough fundamental analysis is available only for big banks with a staff of professional analysts and constant access to a wide field of information.Despite these different approaches, and analysis of market fundamental analysis and technical analysis are complementary. Traders who act on the basis of fundamental analysis, however, have to consider some technical characteristics of the market (the basic levels of support - resistance, overbought - oversold), and supporters of the technical approach to the market the main news (% rates, important political events) .
On the main important advantages of the market FOREX:

    The biggest number of participants and the largest volumes of transactions;
    absence of an external regulator - the prices are determined solely by supply and demand;
    Superior liquidity and speed of the market - carrying out transactions in seconds according to online quotes;
    24-hour operation throughout the week;
    the possibility of opening a position for any period of time, depending only on the trader;
    No fees, except for the difference between the purchase and sale;
    opportunity to get a bigger profit than the invested sum;
    Qualified work in the FOREX market can become your main professional activity;
    You can make deals any time you like.

Money management

Money management
Jobs in the financial markets is impossible without an effective allocation of assets. Effective capital management allows a trader to "survive" in the markets with margin trading. Just keeping an equal ratio between the profit and loss amount per average trade, the trader gets the opportunity to work with money, not play. Consider the general principles and rules of money management.
1. The total amount of investment should not exceed 50% of total capital.This principle establishes a rule for calculating the margin for open positions: the size of mandatory reserves for use in emergency situations and to continue normal operation should not be less than half of total capital. The figure is 50% of Murphy, but many analysts believe that the percentage of the investment should be even lower: 5% - 30%.
2. The total amount of funds invested in one market may not exceed 10% - 15% of total capital.In this case the trader is insured from excessive investment of funds in a deal that could lead to bankruptcy.
3. Norma risk for each market in which a trader invests its funds should not exceed 5% of its total capital.Thus, if the deal turns out to be unprofitable, then the trader is willing to lose no more than 5% of the total amount of their funds. 5% figure is taken from Murphy, however, such as Elder gives a figure of 1.5% - 2%.
4. The total amount of guarantee fees, made when opening a position, one group of markets shall be not more than 20% - 25% of total capital.Markets included in one group moving more or less the same. The discovery of large positions in every market, one group violates the principle of diversification, so the placement of funds in similar markets should be treated very cautiously. Do not neglect the important rule of optimal allocation of resources: in varying degrees, they must be diversified. Their capital should be placed so that the loss of a big deal not ruined the trader, and, where possible, were offset by gains on others.
When operating on the FOREX market can be divided into four main markets, in which the behavior of exchange rates are quite similar: the dollar zone, sterling, and euro zone yenovaya zone.
5. Determining the degree of portfolio diversification.Diversification is one way to protect capital, but also in diversity should be a measure. Always need a reasonable trade-off between diversification and concentration. More or less reliable means of distribution can be achieved by opening the position at the same time at four to six markets of different groups - no more. The higher the value of negative correlation that exists between the markets, the greater diversification of investments.
6. Determining the level of stop-loss orders.Stop orders are usually placed on the period of absence trader in the workplace and its main task they save from ruin a trader (execution of stop-loss) or to provide extra income (stop-profit).
The value of the stop-loss, first of all depends on how much the trader is ready to lose on one trade and, secondly, from its calculation of the market.
Suppose the trader has dollar deposit size S. Opening a position, he admits the loss of L percent of the deposit amount.
Assume a contract for the purchase of 100.000 USD has been opened against the sale of Swiss franc CHF, with the opening price was p1.
Buy USD 100,000;
Sell ​​CHF p1 x 100,000. At what level p2 trader must put an order to sell, not to exceed the acceptable level of losses ShL?
If the order is at p2 worked, loss of position would have been:
Loss =- CHF (p1-p2) x 100, 000.
On the other hand loss should not exceed USD SxL, or in Swiss francs CHF SxLxp2. Consequently, we have:
(P1-p2) x100, 000 = SxLxp2,
from which we obtain the following expression for the order level:
p2 = p1-p1 xSxL / (SxL +100,000).
It should be noted that in determining the level of the stop-order the trader must be based on a reasonable combination of technical factors, as reflected on the chart, and for the protection of its own funds. Volatile than the market, the more removed should be stop-loss orders on the current price level. In the interest of the trader to place a stop order as close as possible to the price level to reduce losses from failed trades to a minimum. At the same time too "hard" stop orders can lead to unwanted elimination of positions at short-term price fluctuations ("noise"). Too remote stop orders are not sensitive to "noise", but can lead to significant losses.
7. Determining the ratio of possible gains and losses.For each potential transaction is determined by the rate of profit. This rate of return must then be balanced against the potential losses if the market moves in an undesirable direction. Typically, this ratio is set as 3 to 1. Otherwise, from entering the market should be abandoned. For example, a trader provides a risk of the deal at $ 100, then the potential profit should be $ 300.
Since a relatively small number of transactions during the year can bring significant profits to try to bring the profit to the maximum, keeping the lucrative position as long as possible. On the other hand, it is necessary to minimize losses of failed transactions.
8. Trade with multiple positions.Entering the market for multiple contracts (ie, contracting by more than one lot), the trader must divide them into so-called trend and trading positions.
Trends position being liberal enough to stop orders, which allow you to keep these positions even in the face of consolidation and price adjustments. It is these positions give the trader an opportunity to get the greatest return.
Trading positions are intended for short-term trading and limited-rigid stop. As a result, when certain price targets are close, but when you resume trend reversed.
9. Conservative and aggressive approaches to tradeMost analysts prefer the conservative approach. For example, Tevels, Harlow and Stone in their book "Game of commodity futures markets," they write:
"... A trader with the worst possible profit, but sticking with a conservative style of trading, in fact, most will achieve long-term success (winning the game) than a trader, have great potential for profit, but to play aggressively."
This opinion is shared by Murphy:
"... Conservative players in the end really win. Aggressive play trader who wants to get rich quickly. His profit is really significant - but only until the market moves in a favorable direction for him. When the market changes, an aggressive strategy usually leads to failure".
10. Rules for open positions:a) is open only in the presence of one primary and at least one additional signal;b) the opening must specify in advance and write on paper:entry price in the market;the price at which closing a winning position;price at which the closing loss-making position;Estimated time of "life" an open position.
c) carefully and for a short time to open against the trend;d) gently and briefly opened while flat.
11. The rules of carry and the partial closure of the estimated time:a) Maintain the position only if the analysis confirms earlier findings;b) partially closes:in obtaining damages than the calculated;if the price has reached the estimated mark for profit;c) wait:upon receipt of damages calculation below;If the price stays at the same level;if the price did not reach the estimated mark for profit.
12. Rules of the closing of positions:after the estimated time;in obtaining payment of profits;in obtaining payment for losses;when you reach the maximum profit.
PRACTICE GUIDELINES FOR THE ELABORATION OF THEIR OWN MONEY MANAGEMENT IN FOREX.
1. necessarily put the stop and limit orders;
2. in failing to stop and take-profit to take into account that the ratio of profit / loss should not fall below 2 / 1;
3. stop should be no closer than 40-50 pips from entry points. More tight stops sentenced since entering the market, you certainly will not be able to catch the very bottom-spike. The error is usually 10-15 pips. Plus 5 pips spread. If we take into account market noise (10-15 pips), we obtain that stops on display at a distance of at least 40-50 pips from the entry point, there is little chance of surviving a position;
4. on the basis of percentage points 2 and 3, we find that take-profit orders should be no closer than 80-100 pips from the entry point. This system of money management will minimize the factor of a broker, ie, attempts to reduce your profit at the expense of slipadzha (quotations against moving the client to close the position). The value will be for you slipadzha irrelevant factor. You can win from any broker;
5. at a value of stop-loss of 40-50 pips and take profit about 100 pips to hold positions open for no longer than two days. If the price does not go in your direction, then it must go against you. Why in this case, wait for the stop operation;
6. kept under a pledge of 10% of deposit;
7. do not make deals that could result in losses greater than 5% of deposit;
8. move the stop and / or take-profit only in the direction of reducing losses, increasing profits. To get involved this is not necessary, because You run the risk that some stray tick slizhet your foot (bring him too close to the current price), and the price hike will make your limit already without you.

world Finance

Exchange
History of stock exchanges has its roots in antiquity: the first organized trading in agricultural commodities recorded in Sumerian chronicles around 3000 BC The concept of trading contracts for the supply of rice in the future, was born in Japan in the early XVII century. In Europe, exchanges of capital began to develop actively in the Age of Discovery and expansion of colonial trade. Finally, at the beginning of the XIX century in the United States originated the modern futures market. Modern Exchange - it is usually non-profit organization with a fixed membership, to ensure the holding of fair and transparent bidding, as well as ensure their reserves (financial and commodity), the unconditional fulfillment of the obligations of the parties under the contract. Depending on the specifics of traded instruments, and historical traditions of the host country used technology trade can be divided into 3 groups.
Open Outcry
Classic U.S. futures market provides for the organization of trading on the specially designated for each contract areas (pits), which denied access to outsiders, between traders who have birzheye place. After receiving an order from the clerk, customer service (once orders are delivered on paper to the floor boys, runners now use a wireless computer network), or wanting to make a transaction at its own expense, floor trader shouts out his sentence so that he could be heard the rest. Transactions are also accompanied by shouting prices, hence the name (something like "open outcry" in Russian). Support staff (clerks who take orders from customers and smaller brokerage houses) located around the site. In active markets like the S & P 500 has a value, even the place where the trader is also a place where the desk clerk, so many brokers in the advertising plans of leading stock room and note its location. Open Outcry used on all the "old" U.S. futures exchanges.
Auction (Specialist System)
A somewhat more complicated system, called the auction used to trade shares on the traditional U.S. stock exchanges (NYSE, AMEX, PSE). The central part of its experts are carrying out transactions with a small number of shares exclusively. After receiving an order from a customer, a brokerage firm sends its traders in the room, and he, in turn, refers to a specialist, leading a total order book and to notify participants of the lowest prices available supply and demand. The specialist also acts as an agent in relation to the orders received through the electronic system, and can trigger an interest in buying or selling shares, letting potential stakeholders (major) players. In the case of liquidity shortages and an imbalance of orders specialist operates its own capital (cash and shares) to stabilize the market and avoid sharp spikes in prices. The effectiveness of the professional special stock control commission.
Electronic System
The development of information technologies has led to the emergence of automated transactions and settlement. Initially, these systems have been used as support for the reduction of paper work and trade in irregular hours (Globex, Access), but in recent years as a purely electronic contracts (e-mini for CME), and electronic exchanges. And if there EUREX central hall, the computers that are traders, the ideology of the American Cantor Exchange provides for itself only on the exchange of technical personnel, providing the servers. From the terminal, with access to the system, enter orders and transactions, the prices which immediately comes to information systems and broadcast on the computers of subscribers. The electronic system has several advantages: speed, reliability, and most importantly, a level playing field for bidders. If on-site broker representing the client, may not be able to make a deal at the price of the order only because it is too far away from the trader offering the price or volume of the order less than that which agrees quoted side, the market for electronic market these situations almost excluded.
Interbank Foreign Exchange Market
The currency market is the largest in the world by turnover and geography. Its modern history dates from the early 70s of XX century, when it was canceled the Bretton Woods agreement, committed the rates of major world currencies after the Second World War. Since then, numerous attempts of various governments and administrative influence on exchange rates invariably led to the collapse and economic crisis, so that the free market has proven to be effective (at least, sane politician). Freedom has a downside: the market has no supervisory authority, no limits, no arbitration commissions, so that any dispute with the dealer or bank accounts allow the investor alone. An exception is the United Kingdom, where financial institutions that open accounts for clients of speculative currency trading, must consist in SFA (Agency for Futures and Stocks), and obey his rules.
Banks
Banks make most of the actual transactions in the foreign exchange market, providing foreign trade payments of their clients. Leader in technology providing the interbank market, of course, is the Reuters Dealing - a system that provides an opportunity to request the parties to each other's quotes, make trades and track quotes, introduced into the system by other contributors. The rules are determined by calculations bilateral agreements between banks.
Dealers
The growth of public interest to speculate on the currency market has led to numerous non-bank institutions providing services to marginal trading on FOREX. Many futures brokers with a reputation in his open dealing departments. Customer relationships are defined by the contract, the essence of which in a nutshell is as follows: The dealer is not responsible for anything, the client - for all, not only within the initial deposit (ie, can be left). Unlike the stock exchange, where prices are determined by consensus of the bidders in the currency market the client receives a quotation from a dealer, so there is a permanent conflict of interest.

The foundation for success in Forex

The foundation for success in Forex
One of the most important and difficult part of success is a currency trader the ability to analyze and predict market changes, and what factors will influence how changes in exchange rates.
How to predict it? There are many approaches to solving this problem. Some do it by the stars, others rely on the great power of intuition. To work in the foreign exchange market using approaches that combine mathematics with the notion of "forecasting methods." This definition means that the behavior of the system of interest is described by a set of numerical indicators. They are called indicators or indices. For each of them precisely defined way of measuring.
When applied to financial markets, quantitative forecasting methods are divided into two groups: technical analysis and fundamental analysis.
Technical analysis is based on the premise that "considers all": the behavior of prices supposedly already contains all the essential factors to assess the impact. Market movement is the result of making a huge number of participants, possessing the sum of all the available information, which they use in making decisions. The result of these decisions is reflected in price behavior, observing that we have indirect access to all the market information. Technical analysis is at the disposal of the trader enough instruments denominated in graphical form, allowing to predict future price changes.
Fundamental analysis establishes a relationship of exchange rates with the economic situation and competitive position of trading countries, explains the goals and instruments of monetary policy of central banks, shows the relationship between financial markets, the reasons for their ups and downs. Fundamental analysis looks at the market as opposed to technical analysis on the other side. He considers the Forex market as part of the great world in which we live. And every part of this world can provide, ultimately, the impact on exchange rates. Many of them are fairly predictable. For example, the time of publication of economic news, painted in the months ahead. Political crises, which can be predicted, watching the economic indicators of the country in which they may occur.

For the success of the decisive role is played not by the amount of money for your startup account, and the ability to constantly focus on studying the market, knowledge of its mechanisms and the interests of its members.
Of course, the currency market is only part of the global financial market. But because of - the fact that other components of the financial market (government securities, stocks and corporate bonds) in Russia are either lacking or are in their infancy, the work of a currency trader is the most affordable and profitable for the individual investor. This is the only opportunity to delve into the financial market with the head.

Currency speculation can bring significant income in the shortest time. This is an opportunity to demonstrate intelligence and creativity, gain knowledge, to cultivate the will and discipline, and finally find their own business.
Having mastered the profession of a currency trader, you can run on any financial market

Forex History

Forex History

The international currency market has a long history of formation. With the development of bilateral relations market foreign exchange transactions are also gradually modified. Finding the market today feature began in the 70-ies of the 20th century, when it was taken off the system of fixed exchange one currency against another. Upon the termination of the Bretton Woods system and the transition to a "floating rates" rates, a new kind of business that is based on a profit under conditions of constant changes in exchange rates.

The main stages of the global financial market

30s of XX century
The global financial crisis. There is a destruction of trade and economic ties. By the mid-30's London becomes the world's financial center. The British pound was then the main currency for trade transactions and the creation of reserves.

In 1930, the Swiss city of Basel was established Bank for International Settlements. The purpose of creation was the financial support of the newly independent states and nations, temporarily experiencing balance of payments deficit.

1944
In the U.S., was the Bretton Woods conference. It is considered the end of the US-British rivalry. At a conference attended by two major figures: John Maynard Keynes (England) and Harry Dexter White (USA). They are able to develop and adopt a new procedure for the development of the global financial system under the circumstances.

The main provisions of the Bretton Woods system

International Monetary Fund became the most important institution in control of the international financial and economic relations;

Declared the currency, playing the role of international reserves (the dollar and the de facto pound);

Adjustable parities of currencies pegged to the U.S. dollar (possibly deviation - 1%), the dollar pegged to gold (ounce of gold - $ 35);

IMF members have the right change parities only with the consent of the IMF;

Upon completion of the transition period all currencies should be convertible, to comply with this principle, all governments commit themselves to keep international reserves and, if necessary - to carry out intervention in currency markets.

IMF members make payment currency and gold.

1947
To pause the onset of communism in the U.S. are taking European recovery program. U.S. Secretary of State Marshall, in his report outlines the plan, under which Europe's economy is healthier to the point where she can independently maintain its military capabilities. One of the problems is the satisfaction of "dollar famine". If in 1949 the U.S. dollar liabilities Europe accounted for 3.1 billion, in 1959 they reached 10.1 billion dollars.

by 1958
Most European countries have announced the free convertibility of their currencies.

1964
Japan has announced the convertibility of its currency.
After the announcement of convertibility of the major currencies, it became clear that the U.S. is no longer able to maintain the price of $ 35 per ounce of gold. Dollar inflation was a threat to the United States. Kennedy administration adopted a series of wrong actions - a tax on the interest rate differential, which increases costs of foreign borrowers, and a program of voluntary restriction of foreign credits. Tax and limitations served as an impetus to the emergence of a new market - the market Eurodollars.

1967
Devaluation of the pound, which dealt the final blow to the illusory stability of the Bretton Woods system. In the 60s the U.S. current account deficit leads to a reduction in gold reserves from 18 to 11 billion dollars. Simultaneously, the growth of external debt is U.S..

1970
In the United States sharply reduced interest rates, which generates the strongest crisis dollar. For a short period of time a massive outflow of capital from the U.S. to Europe, where interest rates were higher.

May 1971
Germany and the Netherlands announced a temporary free floating currencies.

August 1971
Rising current account deficits the U.S. has forced President Richard Nixon suspended the convertibility of dollars into gold.

December 1971
At a meeting at the Smithsonian Institution in Washington was made last attempt to save the Bretton Woods system. Interval exchange rate deviations from purchasing power parities has been increased to 4.5%. Keep the boundaries of the interval it was very difficult. And some time later, the Bundesbank had intervened in the amount of $ 5 billion. It was an enormous sum in those days, but it has not brought success. Currency Exchanges in Europe and Japan had to temporarily close, and the U.S. announced the devaluation of the dollar by 10%. Developed countries have ceased to maintain fixed parities and embarked on a currency float.

1973-1974
United States phased out the tax on the interest rate differential and a program of voluntary restriction of foreign credits.
The Bretton Woods system ceased to exist. In recent years, the Bretton Woods system of currency traders benefit more speculative profit during periods that followed the cessation of intervention by central banks. After abandoning fixed exchange rates the possibility of extracting those profits are strongly limited. Many banks have incurred large losses, and two well-known "Bunkhouse Hershtadt" in Cologne and "Franklin National" in New York - even went bankrupt because of unsuccessful speculation.

1976
Jamaica held conference (Kingston). Representatives of the leading world states have formed a new principles of the World Monetary System. States had rejected the use of gold as a means of covering the deficit in international payments. The main elements of the new system are the inter-state organizations that regulate exchange relations, currency convertibility. Means of payment are the national currencies of the countries. The main mechanism through which the international currency transactions, are the commercial banks.

1978
Created the European Monetary System (EMS). The core of EMU is a grid of cross-currency exchange rates with central and boundary values ​​of the exchange rate. In general, EMU reminds Bretton Woods. If the cross-rate close to the border, both sides should conduct interventsiyu.Klyuchevaya currency EMU - doychmarka.

1985
Gradually, the ECU is not countable, but the physical tools. Issued denominated in ECU traveler's checks and credit cards, banks offer deposits in the ECU.

1978-79
Education of the European monetary system. Agreement on its establishment was ratified by nine members - members of European Community. The aim of EMU - an attempt to protect the currency of the member states of sharp currency fluctuations. Of the 9 signatories, only 7 were full members: West Germany (FRG), France, the Netherlands, Belgium, Luxembourg, Denmark, Ireland. Britain did not participate in making all documents, Italy joined them on certain conditions. Simultaneously with the creation of the EMU introduced a new currency - the ECU. Goal - the creation of means of payment within the EMU, and in time - replacing national currencies. ECU was a basket of currencies of the countries participating in EMU. For the national currencies were set fluctuation limits with respect to their central values ​​in the amount of 2.25% for the Italian lira - 6%.

1981
For the European Monetary System has joined Greece.

1986
In the European Monetary System enter Spain and Portugal. For the Spanish peseta were installed outside the fluctuations in the rate of 6%.

1990
The UK joined the exchange rate mechanism, which was developed within the framework of EMU, with the rate of sterling against the German mark 2.9500. West Germany (FRG) and East Germany (GDR) have teamed up in the unified Germany.

February 1992
In the Dutch city of Maastricht, 12 Member States of the European Monetary Union have signed a new Treaty on European Union. The basis of this contract agreement were Roman in 1957. In the Maastricht Treaty outlined guidelines of creating a single European market, European Central Bank, common currency, common economic policy.

September 1992
Hard times for the European currencies. There has been a famous falling pound. During the aggressive sales pound on the currency market the Bank of England and other members of the exchange rate mechanism of trying to keep it within the permissible range of oscillations by the marketplace. But all their efforts have not led to desired results. Then the Bank of England was forced to raise the discount rate three times in one day in the amount of 5% in an attempt to prevent the depreciation of the pound. But this measure is also not helped by continued pressure on the pound. The famous financier George Soros famously played the cheapening of the pound and got a huge profit when he saw that the pound will not be able to keep within the established framework of exchange-rate mechanism. Thus, the Bank of England was forced to withdraw its currency from the exchange rate mechanism. The fate of the British pound and Italian lira shared. It was announced that they are temporarily out of the exchange rate mechanism.

July 1993
The yield of the pound sterling exchange rate mechanism strongly influenced the movement of European currencies. All currencies have experienced the intense pressure that has led to significant movements in the direction of their cheaper. An interesting thing happened with the French franc. After the devaluation of the European currencies French franc was the last bastion of stability. And then the whole market went for him in the hope that it should understand the plight of other currencies. Remembering signed a bilateral cooperation agreement, Germany could not leave the franc to the wolves. Not only does the Bundesbank participated in interventions in the foreign exchange market, but also specifically to support the franc, reduction was accomplished German interest rates. But even such courageous measures could not save the franc against the strong price reduction. Because of these great events in the currency market in the exchange rate mechanism, it was decided to increase the range of possible variations of its constituent currencies with 2.25% and 6% to 15%.

December 1995
European leaders have agreed to introduce the Euro in 1999 for countries that meet certain parameters for the largest state budget deficit, public debt, inflation and interest rates.

December 1996
Determined by the appearance of the banknotes Euro.

June 1997
Determined by the appearance of the euro coins and euro-cents.

March 1998
The European Commission recommends a list of 11 countries that will enter the Euro: Germany, France, Italy, Belgium, Netherlands, Luxembourg, Ireland, Portugal, Spain, Austria and Finland.

May 1998
European Parliament approves the choice of 11 countries which will enter the European Monetary Union with the new currency Euro. To choosing a candidate for the presidency of the European Central Bank.

January 1999
In the market of a new European currency the Euro, which replaced the ECU. 11 European states have fixed exchange rates against the Euro. The European Central Bank began managing the monetary policy of the European Monetary Union (EMU).

How to choose a broker

Choosing a broker in the FOREX market

The CIS benchmark for quality work in the FOREX market for financial services companies are the major western brokerage house. Serious investors choose their just and, above all, for reasons of reliability. In many ways, these preferences are due to psychological causes. Historically, the West (be it jeans, a bank or broker) seems to be Russian citizens who have lived for decades in an "Iron Curtain", a high-quality, reliable and prestigious. However, the failure of such giants as the American Forex Refco and Swiss Sovereign Financial Group has led many of our fellow citizens, trading international currencies, for a fresh look at the issue of choosing a broker. So what should we look for when deciding whether to initiate cooperation with one or another financial company?
Let's start with safety. Reliable financial intermediary is usually considered a broker with a long history of work, license and accountability of regulators, with the insurance industry of its responsibility to customers, streamlined system of risk management within the company, legal transparency, protection of contractual relations. The company has yet to be respectable enough, though each of us understands that term differently.
By itself, life has no guarantees: the above-mentioned major western companies have existed in the market long enough. However, the risk of losing money in the firm-lived significantly higher than that of a broker that offers our clients access to financial markets for years. The long history of work - is well-developed mechanisms of risk management (otherwise, the company would have been ruined), qualified personnel, reliable partners, financial reserves, etc. In short, the history of the company have the advantage over newcomers to the market.
Documents and regulatory bodies. Unfortunately, in practice, licenses and accountability regulatory agencies, whether government or industry, nor does it guarantee the safety of your money. However, this is serious advantage in choosing a broker.
First, the licensing process itself is cut off overt fraud. The Company shall disclose to the state of their owners, to provide statutory documents, financial statements. In addition, regulators in some form of control over operational activities, financial performance.
Secondly, there is always the organization where the client can file a complaint or claim. Thus, control of brokers in the U.S. in the Forex market deals with CFTC (Commodities Futures Trading Comission - Commission Commodity Futures Trading) - a government commission in the status of a federal agency. In England - is FSA (Financial Services Authority - Financial Services Commission). In Russia, the controlling body for leveraged transactions in the OTC market are not available. However, if the Russian deputies will present a problem, then we can assume that it will be the Federal Service for Financial Markets. Federal Financial Markets Service now monitors the activity of brokers on stock and commodity markets and derivatives market. So when choosing a broker you should pay attention to what license he has, who issued it and for how long.
In the case of a broker placing significant funds, it makes sense to ask what guarantees safety of your funds will give you a broker. In England and the United States with such guarantees can be segregated accounts and guarantee repayment of funds from the government. In the CIS countries and other non-regulated brokers reliable are interested in a particular way to address this issue. For example, certain brokers from Russia to insure our responsibility to our clients in the insurance companies "Ingosstrakh" and "Consent", respectively. However, this is not the only way to show customers its reliability. It may be, for example, guarantee a large American or European bank or some other way.
At the beginning of cooperation with some companies, it is important to pay attention to the contract that you sign and on the basis of which then have to work (God forbid sue). The contract should fully describe all material terms of your interaction with the broker on the basis of civil law.
Big companies in their activities are guided not only by the contract, but also the public regulation of transactions, conduct transactions, which are registered all the many nuances (trading conditions, types of orders, disputes, etc.). Lack of regulations should be alerted of the potential client. If you want to work with a domestic broker, and for the financial calculations you offer foreign company or even offshore - is an occasion to think about. Think about how and where they will be resolved disputes, how do you transfer the money. Accounts with foreign companies (not necessarily even offshore) may fall under "antiotmyvochnogo" companies as the CIS and abroad. Is nice, if your money is "hang" in the current account at a bank or merchant account will be blocked just because you - the citizen of Russia or other countries of the former Soviet Union? Again, interest in your payments may be sooner or later to show the tax authorities at your place of residence.
In the CIS, some brokers work on "betting" scheme, offering its clients to bet on currencies. Here it is also important to understand in advance and be prepared for the fact that in the event of a dispute, your "bets" under Russian law, transactions equal to "bet", that is, not subject to judicial protection.
Risk management. Many traders often ask, "Where does my winnings in the event of a successful transaction?". Typically, the work of all dealing centers is organized as follows: minor positions broker "takes", ie acts by the other party to the transaction, and the large transfers to a larger contractor. Thus, the client paid winnings or loss of other customers, or from his own pocket (which is, incidentally, is why a reliable broker must be a large amount of own funds, financial reserves). A large positions, typically the amount of 1 million and above, is shifted to larger parties (banks, for example). This shifting of risk is called the overlap of the net position. Often in small startups overlap is not working, and clients at risk in the event of a major win left with nothing. It is therefore important to find out politely, as organized by the procedure of risk management in the company and where the dealing center covers the net position. Of course, all the details you will not tell (it's a trade secret), but something to find out for sure will succeed. If your broker is flatly refusing to speak on this topic, it is again a reason to think - whether you need this broker.
Now about the reputation. Hard to speculate whether the company's positive reputation. And if so, on what grounds can be judged. Alas, neither the presence of prestigious awards, nor high in the ratings in this country (and not just ours) are not indicative of good reputations. This is only a question of money. But the presence of a negative reputation (defrauded customers, litigation, etc.) can be explained quite easily by using the search capabilities of the Internet and specialized forums.
Working conditions are always important. Qualitative work conditions traditionally include: accurate and competitive quotation spreads, trading with guaranteed execution of pending orders, a modern trading platform, a wide tools, interest on commercial deposit customers.
In the question it is desirable to clarify the quotes from your broker, from which he receives them. Typically, such sources may be information systems such as Reuters, Bloomberg. Remarkably, if the finance company can confirm the right of retransmission contract quotations. This means that it does not include theft. It happens that the dealing center (especially if it is Russian), receive quotes directly from its western broker. From time to time in the quotes flow from any broker happen "outliers", ie non-market transactions is clearly above or below current prices. These emissions can be very damaging to the open position of the client (for example, covering it with a big loss for the stop order). It is desirable to find a broker in the regulations or in an oral interview, as such emissions are filtered and filtered if at all, as well as regulated disputes arising from non-market prices. Reputable brokers usually void all transactions arising from the release and return losses of the loser and cheat customers profit from earned.
Spread. Usually, newcomers to the forex market when choosing a broker in the first pay attention to the magnitude of the spread. A-brokers, in turn, lured by catchy advertising clients, he says, "Once we spread on ... followed by the name of the currency pair ... by one point and below." Experienced traders know that a solid and reliable broker is unlikely to be dempingovat in this area, and not so meticulously relate to the magnitude of the spread. Although, of course, very few people like to pay more when you can pay less.
More important is the execution. Around the guaranteed execution pending orders are highly controversial. Some have argued that the brokers to ensure execution of orders, taking on more risk than the brokers who work with a slippage. Without going into the debates, I note that the guaranteed execution pending orders when dealing with a reliable dealing center - a great benefit to the client. Here is an example. Imagine that before leaving the data on unemployment in the U.S. you are distracting two identical position to buy a pair euro / dollar at 1.21 to the price of two dealing centers. One broker has guaranteed execution of pending orders, and another - no. Fearing the release of positive indicators and, consequently, the growth of the dollar, you put a stop order to the two positions at the level of, say, 1.2. After the data is that the U.S. unemployment fell much more than analysts had expected, and the rate immediately drops to 1.19, that is, to use the traders' language, "makes the two figures." In one dealing center stop order is triggered, and you commit a hundred points of loss, and in another you still have a losing position at 200 points. Moreover, it can still increase if the rate goes lower. Of course, such situations are rare, but nevertheless occur, and this may result in loss of significant (if not all) of funds. That is why the question with a guaranteed performance of pending orders is much more important matter the size of the spread.
The trading terminal and usability
Accepted standard of trading terminal for Forex brokers are:1. availability of free demo accounts (ie the possibility to train on virtual money, test the trading strategy).2. graphic support, the possibilities of technical analysis or export data to a system of technical analysis (Omega, etc.).3. operational reliability and low requirements for the user's computer and the speed of your Internet connection.
An important factor when choosing a broker is a wealth of tools that is available to trade customers of the company. It is very important to try your hand at different markets, with different instruments and conditions. Many brokers allow trading of currencies other than synthetic instruments such as contracts for difference (CFD) on U.S. and European stocks. But some companies - even in Russian stocks, world indices (Dow Jones, DAX, FTSE100, etc.), gold, oil and so on.
The important point is the interest on funds in client's trading account and the ability to sell discrete lots. Well, generally accepted standards at major Russian brokers are:1. Clock news support for customers in the terminal.2. Daily analytical market research currencies, equities, indices, metals.3. 24-hour technical support.4. The presence of a personal manager for major clients
Thus, a good broker is composed of several important elements: reliability, good trading conditions and convenience. In the CIS market is working, many companies and banks, which represent different combinations of these criteria. I hope my tips will help you decide your guide through the world of finance and avoid common mistakes when choosing a broker to market FOREX.What to look for when choosing a web brokerReliability - is the most important fact to note.Robustness include the following parameters:- How many years, this office provides.- Availability of full postal and banking details.- The license for this activity.- Conditions of protection (insurance) from ruin.- Reviews of the company (available on the forums, conferences, personal correspondence with workers and traders, etc.).What are the conditions of entry - to withdraw funds.Practice shows that enrollment at the expense of finance is much easier than finding them again. Learn how this happens in the office can be selected only at the trader make a profit, but this must still be found.The minimum amount to open a working account.Which currency pairs work.Spreads on major currency pairs.Commission for their work.Preferable to brokers with low commission (better even without it). But a small commission can also mean a corresponding quality.The software must be on the level. Rate this software can only work on a demo account in this office. Most brokers offer this service free of charge. To have something to compare to try different software.
How much does it means?One major difference between online brokers in the minimum amount that should be on your desktop account before the start of tranzokatsy.
Among the Russian centers are offices which make it possible to start working (our very poor trader) with a minimum depositeven from 1USD,100 USD,300 USD,Such firms are unlikely to derive your bets on the market. These institutions play against you by the laws of Forex. Terms of pretty tough. However, many offer good software and work with them nicely. If you can get a steady income in such places, you can safely go to a reputable broker.
In small brokers can start to work with a minimum deposit500 USD,1000 USD,2000 USD.
By the middle broker organizations include the Centers initial amount of the working accounts5000 USD,10 000 USD,20 000 USD.
Serious Russian and Western-oriented brokerage centers to a higher initial amount of25 000 USD,50 000 USD,100000 USD.
Leverage. Commission. Spread. Leverage.Leverage allowed to work on the Forex is different at different brokers. The most commonly used 100 and 200-fold from the shoulder, at least 50, 10 and 2-fold.What does this mean?When working on the Forex for profit must exploit multiple contracts 100000 USD. This amount is not lying around at everyone, rich clients are not enough, and Brokerage centers operate with a minimum percentage. Therefore, for a mass market access and provide leverage. From 1000 USD at 100 times the shoulder you are working in the same way as if you have U.S. $ 100,000. Earnings in 1000 USD per day becomes a reality. Loss on this amount is no less real.
Commission.For the services brokerage firm has to pay. The fee can be clearly expressed and disguised.The most common fee for a transaction. It is expressed in a specific amount (ie 20 USD) or under (cost-1_go 2_h points).It may also be charged separately for opening and closing.And to pay for credit when passing through the 0 hour. This is usually 10-15 USD for the standard rate.Meets the payment for the provision of information services and software.Implicit payments we make on the account holding the finance company and not getting paid for it nor any interest fees. However, in fairness it should be noted that there are points which are charged to you for finding the percentage of funds in their account.Also, there are companies that have reported that for the work they do not need to commission, and the profit they get from the spread. I can assure you that almost all companies use it, pushing spreads when opening or closing of the transaction, but prefer to keep quiet about it.
Spread.The difference in price between supply and demand is called a spread. Spread may vary from one to two points 50 to 100 points depending on market conditions.In the quiescent state of the market for small brokers spread is considered normal by 5-8 points, 3-5 points for medium to large 1-3 of Item.When you open or close a position, there are times when instead of the price visible on the screen offers more than the other worse. This is called the effect of slippage or apart of the spread. This effect is different not only in different offices but also depends on the service broker directly you at this time. The more carefully you choose the price, making the abolition of the abolition of the terms offered, the more tired of the broker, and he accordingly pushed the media, sometimes just to annoy you.

40 classic trading rules

40 classic trading rules, time-tested for survival trader
1. Plan your trade. Trade your plan.
2. Record your results.
3. Keep a positive infusion regardless of your loss.
4. Do not bring work home from the market.
5. Constantly raise the level of your goals.
6. Buy on bad news and sell on good.
7. Do not be afraid to buy high and sell low.
8. Always have a well planned time for studying the market.
9. Insulate yourself from the opinions of others.
10. Stay calm, persistent and consistent, act rationally.
11. Limit your losses - use stops!
12. Never cancel a stop after you have placed it.
13. Never enter a market because you tired of being out of the market. Being out of position - is also a position.
14. No need to enter and exit the market too often.
15. Traders learn from losses - not to profit. Learn every loss to improve their knowledge of the market.
16. The biggest challenge in the trade - not a prediction, and self-control. Successful trading is difficult and often accompanied by negative emotions. The most important element of successful trading - it's you.
17. Always discipline yourself by following predetermined rules.
18. Remember that a bear market may be a month to destroy what you have built a three-month bull market.
19. Do not allow to turn big profits in big loss - put trading stops at 20%.
20. You must have a plan, you need to know your plan - and you should follow it.
21. Expect a loss and take them with dignity. Those who brood on the loss, be sure to miss the next opportunity, which is likely to be profitable.
22. Divide your profit in half, and never risk more than 50% of profits by acting against the market.
23. The key to successful trading - the study itself.
24. The difference between acquiring and losing in the market there is not so much natural ability as the ability to responsibly explore its own errors.
25. Think of the loss as a step towards victory.
26. You took loss? Forget about it quickly. You get profit? Forget it even quicker. Do not let the selfishness and greed stand in your clear thinking and hard work.
27. One of the most important secrets of traders - balance their desires with the desires of the market. Market - this is true, because it reflects all the forces fighting there.
28. It is much easier to get into a trade, than to take it.
29. If the market does not do. what you expect from it - get out of the market.
30. Never add to losing positions. The losing position means you are wrong.
31. Do not try to predetermine your profits.
32. The key to wealth in trade - simplicity. Avoid techniques you do not understand.
33. Do not be overly curious about the causes that advance the market.
34. Beware of too much open position, which can affect your emotions. Do not be too aggressive in the market. Treat him gently, let your profits grow gradually, rather than an explosion.
35. Do not attempt to identify the peaks and peaks.
36. You have to trust yourself and your ability to talk sensibly if you want to win in this game.
37. On a thin market, do not try to guess which side will be the next big move - up or down.
38. In the world of money, no one knows what will happen in the future. No! Therefore, successful traders do not try to put their positions on the basis of what is to happen and react to what has already happened.
39. If the ship sinks, do not hesitate - jump!
40. Lose your ability - but not money. With the notable exception of the unusual conditions, take in the habit of using stop-profit. Do not reproach myself if the price continues to grow without you. It is better to think of cases where timely profit taking prevented the loss.

Glossary

Slang in stock trading
Over the years the stock trading was a certain slang. Without knowing it, often can not understand what was going on in the conversation traders.


Currency. Shares. Indices.
Cable (cable) - Pound Sterling. Derived from trading in the beginning of the century when the relationship between Britain and the United States took place on cable.Swissotel (swissy) - Swiss Franc.Bucks (back), greenback (green back), wooden (wooden) - The dollar. With the "green backs" all clear, but with the "wooden" more difficult - in Russia, so usually called the ruble. But Americans are often referred to as the dollar, due to the fact that money is made out of wood.Canadian - Canadian dollar.The Australian - The Australian dollar.Emery - the index of Nasdaq.PARADISE - RAO (RAO UES).


Traders. Trade.
Bull - bull.Bear - playing on the slide.Sheep - a cautious player with no special feeling - is the crowd (for the bulls or bears). Sometimes used instead of "pig".Pigs - go under the knife bulls and bears ...Square, in the square (square-square) - the trader who does not have open positions.Moose - a loss. Of Loss.Elephant - profit (from what is unknown).Short - short position - for sale.Long - long position - purchase.Choyz (choice) - without the quotation spreads. It is believed that choyz given when the trader is tired of the broker. According to the rules of etiquette is that you need to bargain in obtaining choyza.


Central banks, dealing.
Old Lady (Old Lady) - The Bank of England. Introduced by the British politician and playwright Robert Sheridan.Tommy - meeting FOMC (FOMC - Federal Open Market Committee. This committee structure in the U.S. that decides to regulate the currency market, interest rates, lending volume).Fyodor - meeting FED (Federal Reserve United States - similar to the central banks of other countries). Under the FED meeting is meant generally meeting FOMC, as Tommy is taking a decision to change rates, but sometimes they say, and FED.Kitchen - broker does not take positions on the market. Usually dirty, but more often simply affirmative. Normally dealing - almost all of Russia and many Western (including quite large), do not take positions on the market, and overlap (hedged) only when the overall position on customer accounts more than a certain value. In principle, nothing wrong with that.


Misc.
Big fig (big figa) - from the big figure (large figure). Denotes the first three digits in the quote currency (eg the Euro, 0.88; the yen 138).Figure - the passage of currency for a hundred points.Quite often, especially in the review, the term "figure" is also mentioned as a reduction of "bigfigure" (large figure). For example, you can find the expression: ".. the euro took the figure to 88 ..". In this context, "the figure" having in mind both the "big figure".Dodzhik - from the section analysis of the "candlestick." Dodzhikom day is called, in which the opening price is equal to the closing price. (Naprim.: "... it seems today to be dodzhik ...", means that the day will be closed for the same price, that was opened)"Hound of the Baskervilles" - a failed figure of technical analysis. Ie the price has gone wrong as described in classical analysis.IMXO (IMHO) - in my humble opinion.NP - with best wishes.
Glossary
Account Statement - account statement. Contains information about the transactions and condition of the client's account with a broker for the selected period.
Appreciation - increase in unit value of one currency expressed in units of another currency.
Arbitrage - Arbitrage. Risk-free type of trading, when the same currency simultaneously bought and sold against each other to make a profit from the difference in the prices of the two counterparties.
Ask (Offer) Price - the price the seller. The price at which the customer can buy its currency interest (large number of bilateral quotation).
Basis Point - basis point. Hundredth of a percent, used in relation to interest rates.
Bar Chart - chart picture in the bar graph.
Bear - "Bear". A market participant who is bearish on prices.
Bear Market - "bear" market, characterized by declining prices (quotes).
Bid Price - the price the buyer. The price at which a client can sell his interest to the currency (the lower figure in the way the quote).
Bond - a bond (state security).
Broker - broker. The mediator, producing trading on behalf of a client for a commission.
Breakout - a sudden movement of the course through some conditional border (the previous top or bottom level of consolidation).
Bull - "Bull". A market participant, playing on a price increase.
Bull Market - "bull" market, characterized by rising prices (quotes).
Chart - a graph. A graphical representation of changes in prices (of course).
Confirmation - verbal or written confirmation of the broker on the transaction.
Country Risk - the risk associated with changing political and economic situation in the country.
Commission - commission broker for conducting transactions on behalf of a client.
Commodity - commodities.
Consolidation - Consolidation. Figure charting, which characterizes price movement (the course) to the side without a definite increasing or decreasing trends.
Credit Risk - the risk of non-credit obligations.
Cross-Rate - the cross-rate. The exchange rate of two currencies, neither of which is the U.S. dollar.
Currency Swap - foreign exchange swap. Simultaneous two opposite conclusion on the direction of transactions on the exchange of two currencies with different periods of their supply.
Day Order - an order for the transaction, valid for the day.
Day Trading - trading transactions occurring in a single day.
Dealer - dealer. Market participant to trade on company funds (bank), which works.
Direct Quote - direct quote. Presentation of the unit cost of foreign currency into national currency.
Discount Rate - the interest rate at which central bank lends to financial institutions in the country.
Divergence - Divergence. The divergence between the trends in the market, portrayed price chart and graph technical indicator.
Diversification - Diversification. Trading in several markets (multi-tools) to reduce price risk.
Double Bottom - "double bottom". Figure charting a course twice when lowered to a certain level and then rises again.
Double Top - "double top". Figure charting a course twice when raised at a certain level and then fell again.
Dow Jones Average - the Dow Jones index, which characterizes the business activities of the U.S. stock market.
Downtick - move the price downward.
Elliott Wave Analysis - a method of technical analysis of markets, based on the Elliott Wave Theory (Ralph Nelson Elliott).
Eurocurrency - currency held in deposit accounts at banks in countries other than the country issuing the currency.
Exchange risk - risk that the value of currency (currency risk).
Equity - cash balance on the account, Calculate the currency of the security deposit.
FalseBreakout - a false breakout. Short-term movement of the course through some conditional border (the previous top or bottom, level of consolidation), and then return and move in the opposite direction.
Fibonacci Sequence - the sequence of numbers obtained by the Italian mathematician Leonardo Fibonacci. These numbers are widely used in technical analysis to determine price levels (support and resistance) on the market.
Fiscal Policy - fiscal policy.
Fundamental Analysis - Fundamental Analysis. Uses the macro economic indicators to predict the market situation.
Forward Contract - a forward contract. Agreement on exchange of a certain amount of one currency for another at a fixed price at a particular time in the future.
Futures Contract - a futures contract. A standardized forward contract that is the subject of purchase / sale on the exchange.
Gap - the gap. The price range within which no quotations, forms a gap on the chart.
Good-Till-Cancelled (GTC) Order - an order for the transaction, the current will be canceled until executed by the client or broker.
Hard Currency - a freely convertible currency that can be exchanged without restrictions for other currencies.
Hedging - Hedging. The combination of short and long positions in different instruments, which reduced the currency risk.
Head and Shoulders - "head and shoulders." Figure charting, which resembles the line of the shoulders, neck or head man.
Indirect Quote - reciprocal rate. Presentation of the unit cost of the national currency in terms of foreign currency.
Inverse Head and Shoulder - upside down "head and shoulders."
IBRD - International Bank for Reconstruction and Development.
IMF - International Monetary Fund.
Joint Account - joint account, joint account.
Leverage-Leverage, the ratio between debt and equity.
Libor - the interest rate at which the major London banks lend to each other.
Limit Position - the maximum size of an open position.
Liquidity - Liquidity. A market in which we can always make a deal (office hours), is a liquid.
Long Position - long position (in relation to a particular currency). Open position at which the amount of currency purchased exceeds the number sold in the same currency.
Loss - loss.
Maturity Date - the date of execution of earlier commitments.
Margin - Margin (collateral). Client's funds, held by the broker as collateral for the implementation of the trade customer.
Margin Account - a margin account. Account whose owner receives a credit for brokerage transactions.
Margin Call - demand a broker to make an additional security to your account.
Mechanical System - mechanical (computerized) trading system that generates signals to the input (output) in the market.
Monetary Policy - monetary policy.
Moving Average - Moving (dynamic) average. The indicator used in technical analysis to determine market trends.
Narrow Market - "a narrow market." Market with few participants, which is characterized by low volumes and significant price fluctuations.
Necessary Margin - required margin for open positions.
Overbought - "overbought". The situation arising in the market after the rapid and significant increase in the price (of course).
Oversold - "oversold." The situation arising in the market after the rapid and significant decrease in the price (of course).
Overnight - a deal for a term until the next business day.
Pip (Point) - the minimum amount that the value of currencies, usually a 0.01 or 0.0001 of an entire part of the quote currency.
Pyramiding - building trade pyramid. Trading strategy that consists in a gradual increase in the available open positions.
Position Limit - the maximum size of an open position.
Principal - the principal. A market participant carrying out operations on their own funds.
Profit Taking - closing position at a profit.
Rally - a rapid rise in prices (quotes) in the market.
Range - range price. Upper and lower levels of price (exchange rate) reached during a certain period of time.
Recession - recession, decline in business activity.
Resistance - resistance. Price level, which is expected to market a significant number of sellers or orders are concentrated on the sale.
Retracement - calculated at the level of technical analysis possible return (correcting) the price (of course) after the incident rise or fall.
Risk Control - use trade rules to limit losses.
Rollover - transfer an open position to the next settlement date (value date).
Scalper - a trader who earns income from minor (minimum) price changes (of course).
Short position - a short position (in relation to a particular currency). Open position at which the amount of sold currency exceeds the amount purchased in the same currency.
Slippage - slippage. The situation when the stop order is executed at a worse exchange rate than was ordered by his fielding broker. This phenomenon occurs during the fast-changing market. For example, this may occur after the important fundamental data during the speeches of prominent political figures. Run a warrant for a given rate is not possible if the quotation given level overcomes a sharp jump. The amount of slip can vary from one point to dozens of items. Often slip occurs at the opening of trading on Sunday evening, when the courses are different from the opening of the closing rate.
Soft currency - the currency can be exchanged for other currencies with some restrictions.
Speculator - a man ready to risk funds in the commission of trading for profit.
Spike - Spike. A significant difference between subsequent quotations from the previous one. Graphic representation of a climax in the market, which characterizes the most severe "collision" of buyers and sellers. Characterizes the nervousness of the market. Adhesions may appear in the release of particular importance to the market news. However, there are times when spikes appear on the screen without a good reason, this happens on a narrow market. This is a "pampering" of the operators or special loosening of the market.
Spot Date - date spot. In the forex market - the date of delivery rate on the second business day following the date of the transaction.
Spread - the difference between the seller (ask) and buyer (bid) in two-way quote.
Stop Order - an order the broker for the deal when the price reaches a specified level.
Square - "Square" (slang). No open positions.
Support - Support. Price level, which is expected to market a significant number of customers or orders are concentrated on a purchase.
Technical Analysis - Technical analysis. Using the chart and technical indicators to predict the market situation.
Technical Indicators - Technical Indicators. Mathematical formulas used to construct auxiliary graphs to facilitate analysis of the market.
Trader - Merchant who performs surgery on the means or the means of which he entrusted to investors.
Trend - the trend. Sustainable long-term price movement (the course) on the market in a certain direction.
Two Way Quote - sided quotation in which the dealer quotes buying and selling rate.
Value Date - the date of delivery rates.
Volatility - the volatility (volatility, volatility). This term characterizes the degree of variability in the exchange rate within a certain period of time. For example, when the market abrupt fluctuations with large amplitude, then we say that volatility is high.
Uptick - move prices higher.
Yard - a yard. In the forex market - $ 1 billion in U.S. (slang).
Yield - as interest income on invested capital calculated for a period of one year.
Account Statement - account statement. Contains information about the transactions and condition of the client's account with a broker for the selected period.
Appreciation - increase in unit value of one currency expressed in units of another currency.
Arbitrage - Arbitrage. Risk-free type of trading, when the same currency simultaneously bought and sold against each other to make a profit from the difference in the prices of the two counterparties.
Ask (Offer) Price - the price the seller. The price at which the customer can buy its currency interest (large number of bilateral quotation).
Basis Point - basis point. Hundredth of a percent, used in relation to interest rates.
Bar Chart - chart picture in the bar graph.
Bear - "Bear". A market participant who is bearish on prices.
Bear Market - "bear" market, characterized by declining prices (quotes).
Bid Price - the price the buyer. The price at which a client can sell his interest to the currency (the lower figure in the way the quote).
Bond - a bond (state security).
Broker - broker. The mediator, producing trading on behalf of a client for a commission.
Breakout - a sudden movement of the course through some conditional border (the previous top or bottom level of consolidation).
Bull - "Bull". A market participant, playing on a price increase.
Bull Market - "bull" market, characterized by rising prices (quotes).
Chart - a graph. A graphical representation of changes in prices (of course).
Confirmation - verbal or written confirmation of the broker on the transaction.
Country Risk - the risk associated with changing political and economic situation in the country.
Commission - commission broker for conducting transactions on behalf of a client.
Commodity - commodities.
Consolidation - Consolidation. Figure charting, which characterizes price movement (the course) to the side without a definite increasing or decreasing trends.
Credit Risk - the risk of non-credit obligations.
Cross-Rate - the cross-rate. The exchange rate of two currencies, neither of which is the U.S. dollar.
Currency Swap - foreign exchange swap. Simultaneous two opposite conclusion on the direction of transactions on the exchange of two currencies with different periods of their supply.
Day Order - an order for the transaction, valid for the day.
Day Trading - trading transactions occurring in a single day.
Dealer - dealer. Market participant to trade on company funds (bank), which works.
Direct Quote - direct quote. Presentation of the unit cost of foreign currency into national currency.
Discount Rate - the interest rate at which central bank lends to financial institutions in the country.
Divergence - Divergence. The divergence between the trends in the market, portrayed price chart and graph technical indicator.
Diversification - Diversification. Trading in several markets (multi-tools) to reduce price risk.
Double Bottom - "double bottom". Figure charting a course twice when lowered to a certain level and then rises again.
Double Top - "double top". Figure charting a course twice when raised at a certain level and then fell again.

mistakes traders

General concepts of forex trading
If possible, formulate the precise definition, the international currency market FOREX (Foreign Exchange Market) is a set of operations on purchase and sale of foreign currency and lending to specified conditions (amount, rate, interest rate) with the performance of a certain date.
Currency trading has now become a very popular activity up to four trillion dollars of daily turnover reaches a global currency market FOREX, at least 80% of all transactions for operations whose purpose is to derive profit from jobbing on the exchange rate differences.
Those who are faced with the mechanism of functioning of the currency market FOREX, know that it is somewhat different from the models described in classical textbooks on macroeconomics, which states that supply and demand determine the equilibrium exchange rate.
In reality, the currency market FOREX, and indeed all financial markets, is never in equilibrium, its state can be defined as the constant search for an elusive balance.
Result in a diversion of state regulatory policy, exchange rate (it usually does not bring the desired results) was the influx of the FOREX market of professional traders and, consequently, the strengthening exchange rate fluctuations.
Participants in the FOREX market to be well aware of all the features of the timetable for each of the major currencies in the market.
When the curve reaches a kind of currency movements of the cue point, the behavior of the FOREX market becomes technically predictable and, as a consequence, there is potential for significant profit.
In recent years, professional investors have significantly increased their level of participation in the foreign exchange market, FOREX.
What is the market FOREX?
The international currency market FOREX (Foreign Exchange Market) is a set of operations on purchase and sale of foreign currency and lending to specified conditions (amount, rate, interest rate) with the performance of a certain date. Currency trading has now become a very popular activity up to four trillion dollars of daily turnover reaches a global currency market FOREX, at least 80% of all transactions for operations whose purpose is to derive profit from jobbing on the exchange rate differences. And the stock market game FOREX attracts many participants: both financial institutions and individual investors.
The main participants in this market are:
· Central banks around the world· Commercial Banks· Exchange and brokerage houses· Investment, insurance funds and Hedzh.fondy· Corporate profiteers· Private investors (Tredery)
How stable is the currency market FOREX?
Those who are faced with the mechanism of functioning of the currency market FOREX, know that it is somewhat different from the models described in classical textbooks on macroeconomics, which states that supply and demand determine the equilibrium exchange rate. In reality, the currency market FOREX, and indeed all financial markets, is never in equilibrium, its state can be defined as the constant search for an elusive balance. For some time, namely 1971., The search became more active. This is due to failure of the Bretton Woods system of fixed exchange rates and the transition to a free floating relative to one another. Result in a diversion of state regulatory policy, exchange rate (it usually does not bring the desired results) was the influx of the FOREX market of professional traders and, consequently, the strengthening exchange rate fluctuations. Since then, the profession of a trader (or trader) on the FOREX market is becoming increasingly popular. Worldwide, it is considered one of the most intelligent and profitable, many of the representatives of this area became a "national heroes" of the financial market (like Soros) and built a dazzling career.
What moves the market FOREX?
Among the main factors affecting the exchange rates of currencies in FOREX, you can list the following: balance of mutual payments, the state of the economy, the forecasts made on the basis of technical analysis charts, as well as political and psychological factors. The main factor determining the current time in FOREX, you can consider the movement of capital between nations. In addition, factors such as inflation or discount rate can also significantly affect the value of currencies. At the same time that the government always stands behind the currency, without doubt, the important point. The State shall exercise its influence on the FOREX market in two ways. The first of these - the control, the second - the so-called intervention. Control (currency) keeps people from doing that can adversely affect the prices (for example, transferring money abroad). Intervention - is a bonus. The sale or purchase of foreign currency in order to increase or, conversely, to lower its price in the market FOREX. All these, as well as many other nuances of the currency market FOREX price movements in the FOREX market does not stop for a minute, that is for profit, you are entitled dozens of situations each day. The main thing with this - a competent and professional approach. Having the necessary knowledge, you will be able to work with the most effective financial tools, and therefore increase the chances of increasing the deposit.
Is it possible to fluctuations in the FOREX market a permanent source of income?
The behavior of the exchange rate affects a huge number of factors. If an event affecting the market, it can lead to powerful movements in exchange rates that could be a potential source of good profit. Participants in the FOREX market to be well aware of all the features of the timetable for each of the major currencies in the market. When the curve reaches a kind of currency movements of the cue point, the behavior of the FOREX market becomes technically predictable and, as a consequence, there is potential for significant profit. Jobs in the financial market FOREX requires constant concentration and psychological stability, a willingness to act.