What is the Forex market? Is Forex a multi-level scam?

Are you learning about the Forex market? This is a huge market and some people are still not aware of it. So today, CHK (BTA) brings you the most basic knowledge about the Forex market.

Now, also CHK find out What is Forex Please!

What is the Forex Forex market?

Forex stands for Foreign Exchange. It also has many other names such as Foreign Exchange Market, FX, … In Vietnam, it is called the foreign exchange market.

This is a global decentralized marketplace for exchanges currency. Because this is a global market, it has super high liquidity and huge trading volume.

The 24-hour trading volume on the forex market averaged about $ 6.6 trillion (April 2019), an increase of 1.5 trillion compared to April 2016.

History of forex market formation

In 1971, the Bretton Woods money management system was terminated in order to keep the exchange rate constant. Countries with strong economies pegged their currencies to gold.

Since then countries have gradually turned to a floating rate system. At this point, based on the actual supply and demand, it will determine the buying and selling values ​​of those currencies in the market.

The historical developments in 1971 were the main reasons for the formation of the current foreign exchange market.

FX market characteristics

• The market is global
• Extremely high liquidity
• Easy access
• Available 24 hours a day, 5 days a week

✅Forex is a multi-level scam?

Forex is not multi-level at all!

But there are projects that borrow the name of Forex companies, foreign currency exchanges, forex robots,…. They call to invest in these packages and then you just sit and don’t count the money.

It is these ingredients that give Forex a bad reputation. So people do not misunderstand Forex as multi-level or a scam!

Who can join the Forex market?

Previously, only large banks traded Forex. But with the growth of the Internet all barriers have been broken. Now everyone is in this market.

You are a person with a modest amount of capital. You have an Internet-connected phone. So you are eligible to enter the market!

Maybe you don’t know!

When you travel Thailand. You change from VND to Bath Thai (THB) for personal spending. By doing this, you are also accidentally involved in the Forex market.

Should you invest in Forex?

Anything that generates profits has risks. The higher the profit, the higher the risk. The foreign exchange market is no exception. Someone who makes a profit must have a loss. To be able to win the market you must first win against yourself. You must have discipline as well as your own way of managing risks.

When you first enter the market, you should use it with a small amount of capital. When you feel like you have experience, you can increase it gradually. Moreover, you should be mentally prepared to enter this market. Because this is an emotional game. When you let your emotions take over, you lose.

“To get return without risk, to gain experience without the danger and to get rewarded with nothing. This is as impossible as living without being born. ” – APGouthey

✅How to “make money” in the Forex market?

As you know, when participating in the foreign exchange market, people always sell one currency for another. In this market, you only need to judge whether the price is up or down. From those judgments, you make trades of currency pairs for a profit.

For example: You have Euro (EUR). You see the price of EUR rising against the USD. At this point, you will choose the EUR / USD currency pair to sell Euro. This means you sell EUR for USD. On the contrary, when you see the Euro price falling and you think it will go up again. You also choose the EUR / USD pair to buy EUR in USD. This purchase and sale will bring you profit in this market.

Market analysis

Market analysis helps you to reduce the risk of entry. At the same time, it increases the chances of winning significantly. But it is not easy to judge which direction the market will go in. However, you can still analyze based on several methods.

Basic analysis method

With this method you have to track the situation of a country. The power of money goes hand in hand with the power of the nation. You should follow the news, news… about the situation of that country.

Such as the US-China trade war, the yuan price dropped to a record. At the same time, gold became a safe haven for investors. The demand for gold increased, so the price point also increased.

With this analysis will give you a long-term view of the market. From there make the best investment decisions.

Technical analysis method

This is the method that traders often use. The past data, indicators, candlestick patterns … help you predict a part of the market trend. Because prices tend to repeat what happened in the past.

This method gives you a short, medium, or long term view of the market.

Psychoanalysis

Unlike other markets. The Forex market is difficult to manipulate so price is determined by supply and demand. When a currency increases in price. That proves it has many people thinking that this currency will rise rather than decrease. To know which side has the upper hand. You don’t need to analyze graphs or news. The only thing you need to do is analyze the market sentiment. Market sentiment is difficult to grasp. But you can also join communities to follow. From there, you can partly predict general psychology.

✅Trading time of the forex market

This is a decentralized market, so there is no specific transaction point. The forex market is very dynamic. It operates 24 hours a day except Saturday and Sunday.

Although operating 24/24, the market is also divided into sessions. Major sessions: Australian Session (Sydney time zone), Asian Session (Tokyo time zone), European Session (London time zone), American Session (New York time zone). Each session will have different fluctuations, trading volume.

Usually, the trading volume is high in the European session. The market became more and more exciting when the US session started.

When the European and American sessions overlap (New York morning and London afternoon) are the busiest time. Trading volume at this moment accounts for the majority of the market more than 5 trillion USD a day.

✅Conclusion

Hopefully, through this article you have learned about the Forex market What is Forex ok!

If you still do not know what Forex is, do not hesitate to leave a comment below the article. CHK (BTA) will try to answer your questions as soon as possible.

Thank you for viewing the article and wish you success!