Global Forex

Forex — foreign exchange — is the market where currencies are traded against each other. It's the largest financial market in the world: over $6 trillion changes hands daily, trading runs 24 hours a day from Monday to Friday, and there's no single central exchange.

Every trade involves two currencies — a base currency and a quote currency.

Why trade forex:

• A genuinely 24-hour market — trade whenever suits you.
• High liquidity — easy to enter and exit positions.
• Leverage available, often 1:100 or higher.
• Profit from currency movements directly, or hedge international exposure.

Major pairs:

• EUR/USD — Euro vs. US Dollar, the most traded pair in the world.
• GBP/USD — British Pound vs. US Dollar.
• USD/JPY — US Dollar vs. Japanese Yen.
• USD/CHF — US Dollar vs. Swiss Franc.
• AUD/USD — Australian Dollar vs. US Dollar.
• USD/CAD — US Dollar vs. Canadian Dollar.

Leverage magnifies all of this: with 1:100 leverage and $1,000 of capital, you can control a full $100,000 lot — meaning a 1% adverse price move can wipe out the entire account.

The bid is what the broker pays you; the ask is what you pay the broker. The spread between them is your cost of entry and exit. Major pairs typically run 0.1–2 pips, minors 2–5, exotics 5–50 — and spreads can blow out to 5–100+ pips during major news events.

Slippage happens when your order fills at a different price than requested, most often during high-volatility news releases. It's a real cost — plan for it rather than being surprised by it.

The London–New York overlap is the single most active window of the trading day — the tightest spreads and heaviest volume show up there. The market closes entirely from Friday 5 PM EST to Sunday 4 PM EST, though open positions carry through the weekend.

A safe haven currency tends to strengthen during market turmoil, as investors flee riskier assets toward it.

• USD — the world's reserve currency. Strengthens on global uncertainty, trade war headlines, and recession fears.
• JPY — Japan's low rates and stable economy make it a classic flight-to-safety currency.
• CHF — Switzerland's political neutrality means it tends to strengthen during geopolitical tension.

The opposite group — AUD, NZD, ZAR, MXN — tends to strengthen when markets are calm and risk appetite is high, and weaken first when sentiment turns.

Leverage cuts both ways — with 1:100 leverage, a 1% adverse move is a 100% account loss. This is why risk management in forex is non-negotiable.

• Always use a stop-loss.
• Target at least a 1:2 risk/reward ratio — you only need to win 40% of trades to come out ahead.
• Track every trade in a journal.
• Reduce position size after a losing streak rather than doubling down.
• Never add to a losing position.
• Take profit at a predetermined target instead of hoping for more.

• Over-leveraging — one bad news event wipes the account. Cap leverage around 1:10 while learning.
• No stop-losses — a small loss becomes a huge one while you wait for a reversal.
• Trading during major news — volatility and slippage explode; a $20 stop can become a $200 loss.
• Oversized positions — risking 10%+ per trade turns one bad week into a 50% drawdown.
• Emotional trading — revenge trading after a loss, FOMO-buying a spike. Stick to the plan and take breaks after losses.
• Trading pairs you don't understand — know what actually drives the currencies you're trading (e.g. CAD tracks oil prices).

• Forex is currency trading, 24 hours a day, 5 days a week.
• Every trade involves a pair — a base and a quote currency.
• A pip is the smallest standard price move, usually 0.0001.
• Leverage amplifies both gains and losses.
• Spreads are a real, ongoing cost of trading.
• Interest rates and economic data are the biggest long-run price drivers.
• The 2% rule is the single most important risk control.
• Most retail forex traders lose money — trade only what you can afford to lose, and start small.