Best forex trading app is all about currency swapping. Foreign Exchange or Currency Trading is the name of the world’s biggest financial marketplace where currencies are exchanged for profit. Forex is dominated by the following currencies: USD, Eurodollar, British Pound, Canadian Dollarswiss Franc Australian Dollar Swedish Krona Hong Kong Dollar Norwegian Krona. Supply and Demand determine the price of each currency. Also, other factors like interest rates or the economic and political situation of the nation can influence the value. Forex participants range in size from banks, multinational corporations to smaller businesses.
Forex trading also offers 10 additional benefits which are attracting thousands of Forex traders around the world every single day. Take a look at each of these individually.
1. Forex traders can trade every hour. Traders can trade anytime, day or night. For this reason, the level of market activity fluctuates during the day. A veteran Forex investor can tell you when it is the most active. Forex has four different sessions. New York is one of them, as are Sydney, Tokyo and London. A new trading session is usually opened when one is closed, so the market remains open for 24 hours. Market activity is highest when trading sessions overlap.
2. Highest liquidity- Market size is determined the amount of traders (buying and trading currencies). Forex offers the greatest liquidity of all financial markets. It is believed that the Forex market has a high volume of currency trading at all times. This results in an exchange of about US$4 trillion per day.
You may remember that in the first point, it was said that when the market is busy is the ideal time to invest. It is important to note that this is the time when most of the trading is taking place. There are more deals available and exchanges when most of them happen. Also, the volatility (currency prices fluctuation) of the market is low. Spot trading is easier when currency prices are high. A trade becomes slow when liquidity levels are low. Also, price fluctuations occur slowly. Price changes can be very drastic. Therefore, it is quite easy to loose money in this time.
3. Leverage- This is a feature that allows traders to invest more money on their account than they have. A small investment can yield huge returns. In many cases, the trader is able to set their own level of leverage. It is measured as a ratio. Assume that you want to trade a position with leverage 50:1. You can now trade with up to $50,000 for every dollar. You can now trade as much as $25000 for only $500.