What is Forex ?

Simply put, Foreign Exchange (forex or FX) is when someone trades one currency for another. A simple example can be is when a person swaps the US Dollar for the Euro. I know it sounds boring, but here’s the interesting part, if you forecast that one currency will be stronger versus another, and your prediction ends up on point, then you can make a profit and you buy yourself a nice fancy dinner.

Each and every country in the world has its own economy and therefore its own currency of exchange. People who live in the European Union use the Euros as their exchange currency. People who live in the United States use the US Dollar as their form of exchange. The Japanese use the Yen, the Chinese use the Yuan… I think you got the point!

Now let’s say you want to exchange two currencies from two different countries. First, you have to check what is the relative price of the two currencies, which is called the exchange rate. For example, if you want to exchange €100 to US Dollars at today’s exchange rate, a quick Google search will show you how much your €100 is equivalent in US Dollars. So, in this case, you will get $113.65 for your €100. That means, today the Euro is more valuable than the USD. Tomorrow, the exchange rate can change and the value of the Euro against the US dollars can either increase or decrease.

The way to make money with forex is by taking advantage of these market fluctuations. But in order to do that, you need first to understand what, why, how and who moves this market?
The next step will be for you to develop the necessary forecasting and trading skills before capitalizing on the limitless opportunities.

But don’t worry! We will cover everything you need to know about Forex and trading in this LOOOONG but easy-to-follow guide.

So, let’s start from the beginning…