There is the useful information about some forex tools or instruments of forex technical analysis and some just interesting forex data:
The term INTERBANK is a very common nomenclature in FOREX. This term alone is simply referring to banks and large institutions exchanging information about the rate where their customers or they themselves wish to trade the currency. However, due to the continuous growth of the financial market, this term is now basically referring to any parties who wish to trade their currency in FOREX. According to survey, it is estimated where 70% to 90% of the whole FOREX market is speculative. This means that, 70% to 90% of the parties trading inside FOREX have no intention of accepting deliveries of the currencies, instead, they are just speculating the flow and the movement of the market, awaiting for a profitable opportunity to trade their currencies. Normally, nearly all of the currency in FOREX is traded against the US Dollar and the four most actively traded currencies, the majors, are the Euro, Yen, Swiss Franc and Sterling.
In FOREX trading market, trading is regulated by the Financial Services Authorities and therefore, before anyone starts trading in FOREX, they must first show that they have at least all the basic knowledge needed in margin trading. After all, FOREX trading is a high risk margin trading market which requires a definite understanding of the risk involved behind it.
Forex Trading - Spot Market & Forward Market
A currency trade is the simultaneous buying of one currency and selling of another one. The currency combination used in the trade is called a Cross (for example, the Euro/US$, or the GB Pound/Japanese Yen.). The most commonly traded currencies are the so-called majors EUR/USD, USD/JPY, USD/CHF and GBP/USD.
The most important forex market is the Spot Market as it has the largest volume. The market is called so because trades are settled immediately, or on the spot. In practice the settlement needs two banking days to be completed, including the necessary documentation.
In case of Forward Market Transactions, settlement on the value date selected in the trade means that even though the trade itself is carried out immediately, there is a small interest rate calculation left. The interest rate differential doesn't usually affect trade considerations unless one plans to hold a substantial position with a large differential for a long period of time. The interest rate differential varies according to the cross trading entered into. On the USD/CHF, the interest rate differential is quite small, whereas the interest rate differential on NOK/JPY is large. This is because if one trades in, e.g. NOK/JPY, he gets almost 7% (annual) interest in Norway and close to 0% in Japan. So, if he borrows money in Japan, to finance the trade and buying NOK, he will have a positive interest rate differential. This differential has to be calculated and added to his account. The speculator can be exposed to,both a positive and a negative interest rate differential, so it may work for or against him when he makes a trade.
Trading on Margin
This is a facility allowed to the investors by the Forex Brokers. It means that the investors can buy and sell assets that represent more value than the balance in your account. Forex trading is usually carried out with relatively small margin deposits. This is useful since it permits investors to exploit currency forex rate fluctuations, which tend to be very small. A margin of 1.0% means one can trade up to USD 1,000,000 even though he has only $10,000 in his account. A margin of 1% corresponds to a 100:1 leverage,because US$ 10,000 is 1% of US$ 1,000,000. Using this much leverage enables a speculator to make profits very quickly, but there is also a greater risk of incurring large losses and even being completely wiped out. Therefore, it is inadvisable to maximise the leverage, as the risks can be at the higher end.
Forex trading system
Trading forex through dt FX is remarkably easy. Everything you need to trade can be found right here or on the dt FX Trading Station. (Open up a live trading account right now� or a FREE demo account with $50,000 worth of virtual money.)
In the forex market, currencies are always priced and traded in pairs. You simultaneously buy one currency and sell another, but you can determine which pair of currencies you wish to trade. For example, if you believe the value of the Eurodollar is going to increase vis-a-vis the U.S. dollar, then you would buy the euro in the euro/U.S. dollar pair. The objective of forex currency trading is to exchange one currency for another in the expectation that the market rate or price will change so that the currency you bought has increased its value relative to the one you sold. If you have bought a currency and the price appreciates in value, then you must sell the currency back in order to lock in the profit. An open trade or position is one in which a trader has either bought/sold one currency pair and has not sold/bought back the equivalent amount to effectively close the position.
The first currency in the pair is referred to as the base currency, and the second currency is the counter or quote currency. The U.S. dollar, as the world's dominant currency, is usually considered the base currency for quotes, and includes USD/JPY, USD/CHF, and USD/CAD. This means that quotes are expressed as a unit of $1 USD per the other currency quoted in the pair. The exceptions are the euro, Great Britain pound, and Australian dollar. These currencies are quoted as dollars per foreign currency.
As with most traded financial products, forex quotes include a "bid" and "ask." The ask is the price at which a market maker (dt FX) will sell (and you can buy) the base currency in exchange for the counter currency. The bid is the price at which a market maker (such as dt FX) is willing to buy (and you can sell) the base currency in exchange for the counter currency. The difference between the bid and the ask price is referred to as the spread. With dt FX, you get tight spreads reflected in our firm prices quoted to buy or sell each currency pair.