The variability of exchange rates (volatility) and high liquidity of the foreign exchange market are a powerful attractive force, allowing Forex players to feel free and receive significant income in a short time. And since you can make a profit both on an increase and a decrease in exchange rates, even during economic downturn a talented trader is able to provide himself with a stable income.

But we should not forget that the greater the potential benefit, the higher the risks, and in the absence of proper endurance, knowledge and experience, you can be left with nothing.

How does the Forex market work?

International currency market Forex (FX) is a platform for the free exchange of currencies and profit from exchange rate differences. Changes in rates are regulated only by supply and demand. Forex is not tied to any geographical location and works around the clock.

The daily turnover of the Forex currency market exceeds four trillion dollars. Main currencies used - U.S. $, euro, pound sterling, yen and Swiss frank. Operations on financial trading platforms are among the main sources of income for the world's largest financial institutions. In particular, up to 80% of the profits of the famous Swiss Union Bank Bank of Switzerland provides Forex trading.

The main participants in trading processes are commercial and central banks, investment funds, companies that import and export, multinational corporations, national exchanges, brokers (intermediaries between buyers and sellers who receive interest from transactions), dealers and individuals who carry out financial operations for the purpose of making profit (traders).

It is believed that in our time everyone can realize themselves as a trader. Indeed, this does not require a diploma, you only need analytical skills, the ability to “feel” market changes, and you also need a deposit - start-up capital, minimum size which is determined by the broker.

This statement is both true and false at the same time. Despite the fact that any adult citizen without a diploma in economic education can become a trader, the player must nevertheless take care of his continuous specialized training (usually through self-education) and increasing experience.

The main advantages of the global Forex currency market are high liquidity and globality. For a trader, there is another important advantage of trading on Forex - the presence of leverage provided by brokers. Leverage allows you to carry out transactions in the absence of the required amount or to increase the volume of the transaction in order to increase your potential benefit (but at the same time - risk!) from the difference in the exchange rate. Naturally, the greater the amount spent, the greater the gain (or loss) will be.

Introduction to the Forex currency market: trader's tools

Getting to know the Forex currency market begins with studying the basic concepts and trading tools. The success or failure of a trader directly depends on the ability to analyze the current market situation and competently build a game strategy.

Transactions

The main tool of any business is the transaction. Forex is no exception; this over-the-counter foreign exchange market has several of its own, specific types of transactions. Let's look at the trader's tools.

• Spot- an instant transaction, but in interbank practice it is settled in real currency within up to two days. Therefore, a spot transaction is also called “cash”, “cash”, “T+2” (Time+2 days). Types of spot transactions also include TOD (today) and TOM (tomorrow). Exchange rate fixed at the time of conclusion of the transaction, and not on the day of currency delivery - “today”, “tomorrow”, “on the second day”. Present current conversion operations(“spot”), like all other types currency transactions, are carried out non-cash and even virtual, although the meaning of transactions and their terminology on the spot market remain the same.
  Thus, spot price(or spot rate) is the price of a real product (currency) sold here and now on the terms immediate fulfillment of obligations (deliveries). The spot rate is determined automatically as a result of trading, but can be negotiated individually by counterparties - parties to the currency exchange agreement. This happens when making particularly large transactions.

The term “forward market” does not carry the meaning “immediate”; on the contrary, it assumes that all transactions in this market are carried out with a delay in the fulfillment of obligations (currency delivery) for a period of more than two days. This contrasts the derivatives market with the spot market, which requires immediate execution of obligations. The instruments of play on the derivatives market, or types of transactions (contracts), are forwards, futures, options and other derivatives.

• Forward- foreign exchange trading tool Forex market, which involves fixing the exchange rate for a future date (delivery). As a transaction (contract), a forward cannot be terminated and is binding on established conditions. That is, by the time the obligations are fulfilled, the currency exchange rate may change up or down, but regardless of this, the exchange will be made at the rate at the time of the transaction. The deal can be concluded for a period from 3 days to 5 years. The participant gets the opportunity to withdraw the money only after this period has expired. Forwards are concluded to play on the difference in exchange rates, they Not are standardized and used in over-the-counter markets and are therefore less liquid than other types of transactions.
  Forward price (forward rate), is usually always higher than the spot price (spot rate), since until the moment of settlement the money can be put, relatively speaking, on deposit in a bank where they will run up additional interest for the contract amount. The forward price is calculated in two ways: either by adding a premium to the spot price, or by subtracting a discount from the spot price. But first you need to determine the size of the premium or discount:
  where: P - bonus; D - discount; S ($/€) - current spot rate (price); R€, R$ - interest bank rates for deposits in € and $ currencies, respectively (or in currencies from any other currency pairs); n is the validity period of the forward transaction.

  In special bulletins you can find forward rates for different periods, already calculated using interest rates LIBOR. To analyze and compare the efficiency of investing at a forward price in the international and domestic foreign exchange markets, the forward rate can be defined as the ratio of interest rates taken on an interbank loan multiplied by the spot rate.
  

  

  where: Fn($/€) - forward exchange rate (price); S($/€) - current spot rate (price); R is the interest rate on the interbank domestic market; L - interbank rate LIBOR.
• Futures (jarg - “future”) . Such a transaction is similar to a forward, moreover, it is a type of forward with the difference that it standardized in size and terms of circulation and is of a recurring rather than one-time (unique) nature. Futures means the exchange of specific currencies on a specific day at a predetermined rate. Futures transactions are concluded for individual lots. If necessary, the rights to futures can be resold to another person. Currency futures differ from currency pairs in the form of a ticker, trading platform and contract expiration dates, they allow you to analyze the volume of exchange trading, which in itself is very valuable. In other aspects, they are identical to a currency pair - even the futures chart repeats the chart of the currency pair.
  Futures price based on forward and spot prices and is usually identical to the former unless distorted by differences in tax legislation different countries, terms of guarantee payments and some other factors. The difference between the spot price and the futures price is usually called the “basis” or “basis”, which is usually positive (the “contango” state), but can also take a negative value (the “backwardation” state). A backwardation situation occurs when the futures price is below the spot price.
  Historically, the futures price is expressed in US dollars, or more precisely, these transactions are carried out in world currencies against the dollar. In addition to Forex, futures are widely traded on the Chicago exchanges (CME, SWOT, IM), Paris (MATIF), Singapore (SIMEX), Tokyo (TIFFE), London (LIFFE), Toronto (TFE) and Sydney (SFE) exchanges, and are used in interbank trading ( over-the-counter).
• Option - this is a kind of “deal for deal”. More precisely, the provision by the seller of an option to its buyer of the opportunity, or the right (but not the obligation!), to enter into a certain transaction according to a previously agreed upon exchange rate on a specified date or time period. At the same time, the seller of such a right (contract) assumes full obligation to complete the transaction in accordance with the terms of the option, and the trader, at his own discretion, may not use the purchased right.
  Considering that the transaction can be multidirectional, FX options can be sold ( put option) - purchased in anticipation of a fall in the price of a currency pair, or to buy ( call option) - are in demand with the expected increase in its price, as well as bilateral ( double option). There are also exotic types of contracts for the transaction, for example barrier options ( barrier options), also called trigger or hurdle options. Their essence is that payments under these contracts are “included” ( knock-in) upon reaching the trigger point - a certain price level of the underlying asset, and “turn off” ( knock-out) - when the price of the underlying asset falls. The underlying asset can be a currency pair. Barrier options and their variations (Up&In, Up&Out, Down&In, Down&Out) allow you to build complex and incredibly complex market strategies (for example, “Bull Spread”) that are used by sophisticated traders.
  FX options are a more liquid instrument than exchange-traded options, since on Forex there are contracts that are only a few days long, while on the exchange the expiration dates can reach many months. At the retail Forex level, they became available to traders only in 2009. Options, from the point of view of the value date (fulfillment of obligations), are distributed throughout the year by delivery month, and the contracts with the month closest to closing account for the maximum activity of the Forex market. In this context, the options market begins to behave like a spot market. And if you want to maintain the position of a pair, say USD/EUR, after June, then you will have to sell it and at the same time buy the July USD/EUR. On spot trades there is no reason for this, since all positions are carried over to the next business day automatically at the expense of overnight (see below).
  The profit of the option seller (writer) consists of the premium paid to him by the buyer for the opportunity to take advantage of a profitable transaction, the size of which, in turn, changes based on market conditions. The main advantage for the buyer of an option is that the risk is limited by the price of the option, the disadvantage is that a premium is paid for transferring this risk to the other party. IN this key Options can be thought of as a kind of insurance policy.
  So, FX options are used not only as trading instrument, but also an insurance (hedging) instrument to manage risk in a cash transaction.
• Currency swap, or roll-over, storage, overnight. At its core it is monetary transaction on the Forex market, and not a conversion transaction, although formally it looks like one. It represents the simultaneous purchase and sale of currency at equivalent amount, but with two different value dates (terms for delivery of currency, fulfillment of obligations).
  An example of a standard swap: a counterparty (bank, broker, trader) bought 1 million EUR against USD on spot value terms (immediately, up to two days) and immediately sold it on a three-month forward basis, that is, performed a three-month EUR to USD swap. Here the goal is to be able to “step over the night” - hence the name overnight- through trading session, after the end of the delivery period, maintaining the trading position, as well as reduce currency risks, reduce borrowing costs Money in another currency. Swap operations are mainly used major players market.
  And it is important for the average trader to understand that these operations take place automatically at 21:00 GMT through a broker using an installed trading platform and are practically invisible to the client - everything looks like a continuation of the bet. As a result, a currency swap (overnight) is funds retained or added to the client’s account (depending on the difference in interest rates for different currencies) for prolongation (transfer) of an open position to the next day. Many brokerage companies have a flat fee for this service, which incentivizes clients (traders) to conduct short strategies and close positions during the day. It goes without saying that overnight can only be held if you use leverage, that is credit funds broker, and not entirely with your own money.

So, only at first glance, the above types of transactions and operations may seem daunting. In fact, they are quite simple technically, although you will have to spend some time learning them, carefully working on a demo account to get used to it and get comfortable. The situation is much more complicated with the skills of analyzing the market situation and developing a trading strategy, especially with the use of FX options. Since Forex, by definition, is a spot market (over 90% of all transactions are closed within 48 hours), then any transactions should begin with spot transactions. And it is better to open positions on the derivatives market, which is also part of Forex, where forwards, futures, options and other types of derivatives are traded, after a couple of years, when personal professional experience has accumulated.

Analysis

To make deals with maximum benefit, it is important to understand how the Forex currency market, which is part of the global financial and economic system, works. A novice trader needs to pay attention fundamental (FA) And technical analysis (TA) .

The first of them involves studying the relationships economic processes, requires knowledge of the deep fundamentals global economy and politics. The bidder needs to know how macroeconomic and inextricably linked political factors influence the situation in the economy of individual countries and regions, take into account that force majeure circumstances (natural and man-made disasters, terrorist attacks, local wars, political coups) can have a decisive influence ) and mass psychology (expectations, rumors, self-fulfilling panic).

The fundamental difference between fundamental analysis and technical analysis lies in the approach: FA proceeds from the fact that the value of currencies, like any product, is regulated by the law of supply and demand. And supply and demand depend on a number of fundamental economic factors: fortune and growth national economy, changes discount rate And monetary policy, trade balance dynamics, politics central bank etc. Therefore, the value of currencies can be influenced by certain economic and political measures. For PA, indicators are important not in absolute, but in relative terms, that is, indices consumer prices and sentiments, prices work force, unemployment, GDP growth, etc. In order to forecast the Forex market, the most important events and news (expected and planned, unexpected and random) are studied, which can be:

• trade, economic and political negotiations;
• agreements and decisions of interstate and industry unions, alliances, cartels;
• meetings of the Federal Reserve and other central banks;
• statements by presenters government officials on economic and political topics;
• speeches, reports and forecasts of leading economists, political scientists, rating agencies, large commercial banks, etc.

The national economy has one important property: it is inertial and cannot quickly slow down, turn around or accelerate, resembling a heavy icebreaker. But the prerequisites for future phenomena are being laid today. Therefore, PA is necessary when building medium- and long-term trading strategies in Forex, which are simply impossible to carry out without it.

To carry out FA, you need to “turn on the filter” and understand the true significance of the events taking place - some of them, seemingly decisive, may not have any impact on the movement of currencies, others, almost imperceptible, may lead to a reversal of existing trends. This is a complex task that requires extremely high qualifications - an understanding of communication channels and the mutual influence of currencies and others competing with them investment instruments, historical development of interstate relations and national monetary systems, - therefore, only large participants in the Forex market can afford FA: banks, investment funds, transnational corporations, some brokerage companies and outstanding traders.

But even if you have the experience and education necessary for PA, this will not be enough. FA is not applicable and even useless for short-term and intraday strategies due to the above factors. And to play “long”, in addition to knowledge and skills, you need significant capital in order to place stop orders for months, or even years in advance, and suffer losses on open positions in several figures on the chart, which is implied by the use of long-term trends.

But the doctrine of technical analysis is diametrically opposed to FA and is extremely laconic: a chart of changes in currency prices that is formed in real time already takes into account the influence factors described above are economic, political and psychological, which means that for success you should simply analyze this graph. It shows a retrospective of price movements and contains all the necessary hints (signals) regarding changes in trends (bullish, bearish, sideways, etc.). Since, according to the TA postulate, the psychology of the crowd is stable, its past behavior is repeated in the future and is reflected in certain graphic figures of the chart and the nature of its movement. A trader, using today’s rich tools (“Elliott waves”, “Japanese candlesticks”, MACD, RSI, etc.) must select a forecast horizon, correctly build a trend in this time period, determine its strength and possible reversal points, and therefore - entry points into the market and closing transactions. As a result of Forex technical analysis, it becomes possible to say when, within what limits and with what probability a trend change will occur, and how long the new direction of price movement will last.

The information basis of analytics is graphical and mathematical tools that allow you to analyze price dynamics, as well as statistical data and the principles of probability theory. Graphic display of prices can be presented in the form of graphs, histograms, charts and candlesticks.

It is important for a novice trader not only to know the basics of analysis, but also to use a set of available tools, and primarily indicators, which are based on algorithms that allow one to calculate fluctuations market prices. The indicator gives the trader the opportunity to enter trades with the least risk and close positions in a timely manner. Of course, the use of indicators cannot and does not provide a 100% guarantee of success, but it allows you to minimize possible losses. The main advantage of indicators is that they eliminate the need to carry out manual calculations, but in this way they can lull the trader’s vigilance.

There are a huge number of proprietary indicators, but the time-tested and most popular of them are MACD (uses three moving averages), Ichimoku (uses five lines), RSI (determines the strength of the trend and the probability of its change) and ADX (trend indicator).

So, fundamental and technical analyses, on the one hand, are antipodes, on the other, they are inextricably linked and complement each other. Technical analysis, like a small angry dog, tries to reject the postulates of fundamental analysis, which, in turn, does not comment on the tools of technical analysis. It’s like in physics: the laws of the micro- and macrocosm - they differ, and sometimes contradict each other, but at the same time they act in a single space and time. In any case, a trader has no other means than TA when playing short distances, and there is nothing better than FA when building long-term strategies.

Strategies

A necessary condition for successful trading on Forex is the correct tactics of your actions. Knowledge of strategies makes it easier to understand the market and the characteristics of its movement, and, accordingly, helps to choose the right time and direction for opening a transaction. Strategies can be simple (based on the rules for entering and exiting Forex), as well as indicator-based (their basis is the interaction of indicators) and indicator-less (based on graphical elements, their indicator is the price).

Indicator strategies are most convenient for beginners, since forecasts of exchange rate changes are generated automatically. Traders in this case build their own trading scheme based on several indicators. However, it is important for beginners not to get carried away and use no more than three to five indicators, because otherwise there are too many variables to analyze.

The main advantage of indicator-less strategies is the ability to effectively predict price changes, and, accordingly, high profitability with minimal risks. However, using this strategy requires some skill and composure. Experts recommend launching it during a period of weak market movement.

There are also breakout strategies, which are based on the principle of breaking through the highs and lows of value, and Martingale strategies, which involve the simultaneous conclusion of several multidirectional transactions with an increasing lot.

You can hear from unprofessional people or outright scammers that certain strategies for Forex trading are win-win, since even with several unprofitable transactions an overall positive result will be achieved. This is wrong. There are no universal strategies, as well as uniform conditions for their application.

To trade successfully, you must master two or more strategies and skillfully apply them. The most popular of them include:

• strategy for ADX and MACD indicators. A simple strategy in which indicators of the MACD indicator are used as indicators of the direction of trade (the price chart is not used in this case). Ideal for 15 minute price chart;
• strategy “hammering nails”. This universal strategy uses the Parabolic, Awesome Oscillator and Accelerator Oscillator indicators;
• scalping strategy “MA Waves” characterized by simplicity and aesthetics. It is based on the Moving Average group of indicators. The work is carried out on the main trading pairs with a reduced spread (up to 1.5–2 on four-digit quotes);
• THE7 strategy for daily charts characterized by simplicity and power. The work uses a moving average and a cost chart.

Software

Analysis large quantity information and efficiency of actions on the foreign exchange market are ensured thanks to special applications for PCs and mobile devices. These software tools are called trading platforms, and their user applications - terminals. They are equipped with tools for technical analysis, a news feed and various options. Most popular platforms - MetaTrader 4 And 5, MetaStock And OmegaResearchProSuite 2000i. Many traders use several terminals at the same time, which expands the possibilities for conducting technical and fundamental analyses, but we do not recommend doing this. By at least until you reach a certain professional level.

Although the platforms' capabilities are quite broad, they are not always enough for traders. For comfortable work on Forex, there are special scripts - small programs that allow you to place pending orders, close all orders simultaneously, calculate the level without loss, manage open positions and perform other operations.

Website informers allow you to always stay up to date with Forex news. From these self-updating sources you can learn about trading progress and earnings of major companies, as well as get analysis of currency pairs, stocks and indices.

And finally, demo accounts. Brokers usually offer the opportunity to get acquainted with the trading terminal, tools for analyzing and making transactions on Forex by opening a demo account, which allows you to practice on the market with the same software functionality, but without real cash investments.

Books and information portals about the foreign exchange market

Trading on the Forex currency market involves constant development - expanding the knowledge base and developing skills. Experienced players constantly study specialized literature, forums and blogs. A beginner should start by familiarizing himself with works that have become classics, for example, those authored by Alexander Elder (“How to play and win on the stock exchange”, “Trading with Dr. Elder: an encyclopedia of stock trading”, “Fundamentals stock trading"), John Murphy ("Technical analysis of futures markets: theory and practice"), Lewis Borsellino ("Textbook on day trading", "Problem on day trading"), Jack Schwager ("Technical analysis. Complete course"). Forex portals such as www.financemagnates.com, www.forex.ru, www.mt5.com, www.fortrader.org, www.forexmaster.ru and others.

Rules for successful trading on the Forex currency market

Many players become disillusioned with Forex after the first unsuccessful steps. To prevent this from happening, a novice trader needs to adhere to simple rules that will help avoid losses and make the process of working in the market interesting and productive:

1. Study specialized literature, be sure to familiarize yourself with the principles of organizing Forex trading and understand the mechanisms for triggering transactions.
2. Start trading on a training account (demo account), which is a simulator of real trading and allows you to hone your skills. And only after trying various tools and strategies, switch to real money.
3. Trade small amounts, do not risk your entire deposit. Try to use no more than 10–30% of the deposit.
4. Learn from brokers, take part in webinars, attend courses.
5. Use additional features, for example, invest in joint accounts (PAMM), and also earn money on affiliate programs.
6. Control your emotions and don’t chase quick profits. Assess the situation soberly and do not panic because of a loss; Manage your time wisely.
7. Use indicators and advisors. They will help you analyze the market and make transactions automatically from time to time.

Careful preparation, thoughtful analysis and composure are what a novice trader needs to successfully trade Forex. Anyone can master this method of earning money. Reputable brokerage companies provide extensive information opportunities and training programs that will help you understand the intricacies of trading and learn how to plan your actions.

Warning : the contracts or financial instruments proposed for conclusion are high-risk and may lead to the loss of deposited funds in in full. Before entering into transactions, you should be aware of the risks involved.

Forex currency market is an interbank market in which free exchange of currencies occurs, without any fixed values. The name of the foreign exchange market – FOREX – translated from English means « currency exchange» (FOReign EXchange). The terms of trade in the foreign exchange market are the same for Russia and Ukraine: free trade and the opportunity to buy and sell currency at the best price.

The history of the Forex currency market began back in 1971, when the US President decided to abandon the gold standard. All this pushed the Bretton Woods monetary system to the final collapse and led to the possibility of free changes in exchange rates. As a result of these changes, was born the new kind activity - foreign exchange trading, which began to be carried out on the international foreign exchange market.

Trade turnover on the international foreign exchange market, including the markets of Ukraine and Russia, is more than 4 trillion. dollars daily. Small amounts are not convertible on Forex, which is why it was and remains primarily an interbank foreign exchange market. Among its participants are central, investment, commercial banks, dealers, brokers, various funds, insurance and large transnational companies. For private traders in Ukraine or Russia who want to make money on Forex, it is easier to get to the interbank market through brokerage company, offering favorable terms of cooperation.

Most currency systems of certain countries, including the Russian currency market, organize their activities with an eye on Forex. Control over access and features of working on Forex is carried out by the Central Bank. Features of taxation of Forex activities in accordance with personal income tax - if the broker is a Russian company, it must also take on the functions tax agent clients, if not, the trader is obliged to calculate the tax and draw up a declaration independently.

Investment accounts inherently assume that the investor entrusts the management of his finances to third parties - this can result in both profit and significant loss, since the risk of such an investment is very high. By playing Forex, you manage your finances by making decisions yourself. Investment accounts imply the impossibility of independent management.

Advantages of Forex trading over foreign currency deposits are obvious:

• You decide when to withdraw the money. While in the Russian and Ukrainian markets banks place restrictions on early withdrawal of funds, the bank takes back part of the profit.
• Currency deposits allow you to keep funds in one, or maximum two, currencies. Forex trading allows you to trade on several accounts at once (more than 120 currency pairs).
• You can make online trading your profession and receive income without restrictions.

Not long ago we published an article in which we talked about it, gave the basic concepts of this term, and analyzed its functions. One of the components of the global investment market is currency market, which we will talk about today.

I am sure that many of you have heard the term “foreign exchange market,” but not everyone fully understands what it is, how it can be useful, and why one should navigate these economic processes in general.

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Foreign exchange market: in simple words about complex concepts

If you look at Wikipedia, you can find the following definition:

« Currency market(English: Foreign exchange market, currency market) is a system of stable economic and organizational relations that arise when carrying out operations for the purchase and/or sale of foreign currency, payment documents in foreign currencies, as well as operations for the movement of capital of foreign investors"

Currency market very multifaceted. Many economists are still arguing about how to correctly interpret this concept. There are dozens, if not hundreds, of definitions of the foreign exchange market, each of which has its own characteristics. As they say, as many people as there are opinions. But no matter how you understand or interpret the concept of “foreign exchange market”, its essence will not change, it will still have clear functions and fulfill economically assigned tasks. If we talk in simple language, then the foreign exchange market is a place where investors, sellers and buyers of currency values ​​come to a certain consensus.

Perhaps this article would have been written much later, but the situation that is happening in the foreign exchange market of both Russia and Ukraine forced us to understand some concepts in more detail, to understand why significant jumps in the exchange rate of the dollar and euro occur, and who influences these changes , how you can protect yourself from losing the value of your money. Of course, it will be difficult to consider in one article general concepts, give an analysis of what is happening, and even delve into financial analytics. But we will try to provide answers to many questions that arise as concisely and informatively as possible.

Foreign exchange market: what is it?

As you already understand, the foreign exchange market is a system of special economic relations, which are built on the sale and purchase of currency values. This market has all the attributes of a regular market: subjects and objects, supply and demand, structure, communications, the price of goods, even its own speculators and dishonest players. The most important difference lies in the specific product. Here, the basis is the currency values ​​and the currencies of different countries of the world.

Modern currency markets did not arise by chance, but as a result of the evolution of society and economic relations. It is worth noting that transactions for the purchase, sale and exchange of currency existed back in ancient Rome, and in Rus' there were even special money changers who exchanged money, taking a small fee for it. But the first foreign exchange markets, which became the “great-grandfathers” of modern ones, appeared in the 19th century. Economists identify the following basic prerequisites for the formation of the foreign exchange market:

• Development and formation economic ties between different states
• Creation of an international monetary system, which was designed to regulate global monetary relations.
• The spread of lending not only among the population of a particular country, as well as lending from one state to another.
• Development banking system and interaction between banks of different countries
• Development information technologies(telegraph, telephone), which allowed market participants to quickly communicate with each other, negotiate faster and reach agreements.

It all started with national currency markets, the development of which made it possible to form a world, global currency market, where everyone, having fulfilled certain conditions, could buy money from the leading countries of the world.

It is clear that now the foreign exchange market has neither borders nor restrictions. The global Internet allowed participants to buy and sell currency in a matter of seconds, being in different parts of the world.

Foreign exchange market: main features, characteristics and functions

The foreign exchange market has certain features that set it apart from others financial markets. Modern market characterized by the following features:

• Internationalization and use of all kinds of electronic means to work in the foreign exchange market. As mentioned earlier, the development of the Internet has made it possible to significantly speed up work on the foreign exchange market and allow many people to trade currency values without leaving home.
• 24/7 continuous operation. The foreign exchange market is a mechanism that does not stop. It works always, at any time, in all parts of the world.
• Unification of all foreign exchange transactions
• Operations on the foreign exchange market are used for financial protection against all kinds of financial risks. To do this, use hedging.
• Huge number speculative transactions, which are aimed only at buying profitably and selling even more profitably. Moreover, they speculate not only large companies and huge banks, but also legal entities and individuals.
• Static exchange rates, which do not always depend on real economic indicators.

Currency market– this is a multifaceted and complex system, which you will not be able to understand in a few days. Many experts have been studying the specifics of working with the market for years, the influence of certain factors on the exchange rate, the causes and consequences of sudden jumps and collapses. But if you become a specialist, this kind of work can bring in millions of dollars in a short period of time.

It is already difficult to imagine the functioning of the economy without the foreign exchange market. It, first of all, ensures correct and uninterrupted economic cooperation between partner countries, but also performs a number of other functions:

• Ensuring timely international payments for financial obligations
• Creates opportunities to protect against currency and credit risks
• Thanks to the global foreign exchange market, the connection between the foreign exchange markets of different countries is ensured
• Creates opportunities for expanding the foreign exchange reserves of states (purchasing the required amount of foreign currency).
• Regulation of exchange rates due to supply and demand
• The foreign exchange market allows you to realize monetary policy states as an integral part of the general economic policy development.
• Provides the opportunity to earn money by speculating on the growth and depreciation of currencies

Many people know about the foreign exchange market only thanks to the 7th function. But, as you can see, this is a very multifaceted concept, which, first of all, is intended to be a regulator and guarantor economic development and interaction between states and large international companies.

Foreign exchange market: who are the participants?

Like any other market, the foreign exchange market has its participants and subjects. These include:

1. 1. Central banks.

Central banks are the most important regulators of the country's domestic foreign exchange market and are responsible for economic and financial stability. Central banks act as subjects of the foreign exchange market, buying and selling currency as needed.

1. 2. Commercial banks

Banks are the concentrators of funds of the country's population and conduct the bulk of foreign exchange transactions within the state. Many market participants have their personal accounts in commercial banks, through which the purchase and sale of various currency values ​​is carried out.

We can say that banks are subjects of the foreign exchange market both directly, when they buy and sell currency, and indirectly, when through their accounts the purchase, sale, and exchange of currency belonging to individuals and legal entities is carried out.

Companies

Basically, these are international companies that cooperate with companies from other countries. Both importers and exporters of products need the currency of the country with whose companies they cooperate. This creates a certain supply and demand in the foreign exchange market.

By the way, jumps in the dollar exchange rate are, first of all, beneficial to those Russian companies who sell their goods in dollar price tags abroad, and pay their workers in rubles.

• International investment companies, pension and hedge funds, insurance companies.
• Currency exchanges

Many countries have their own domestic currency exchanges, designed to provide the country's population with the necessary demand for foreign currency. The state regulates the activities of these exchanges, because the overall economic situation in the country.

Currency brokers

These are people who buy and sell valuables on the foreign exchange market. Their main function is information about the buyer and seller, concluding an agreement and conducting a transaction. For such work, the broker takes a certain % of the transaction amount. But the amount of this commission is often less than the difference between the bank’s loan interest and the interest rate bank deposit. Banks can also perform this function. In this case, they do not issue a loan and do not bear the corresponding risks.

Private individuals

These are the smallest participants in the foreign exchange market. Each person, when exchanging, buying and selling currency, is part global market currencies. Even if the amount of transactions is relatively small, the total amount can constitute a very large part of all transactions carried out on the domestic foreign exchange market.

Operations carried out on the foreign exchange market

And the last thing I would like to understand is the operations that different participants can carry out on the foreign exchange market. The following basic operations can be distinguished:

Spot – foreign exchange transaction with immediate delivery

This term refers to the implementation of this type of operation that is carried out immediately. Banks undertake to deliver currency no later than the end of the second day after the conclusion of the transaction. Spot is very convenient if you need a large amount of money in a very short period of time. But such operations involve a certain risk, because the exchange rate is a floating value, and if you buy today at one price, tomorrow, at the time of delivery, the price may fall significantly.

With the help of the “spot” operation, banks meet the needs of their clients in foreign currency, the transfer of capital, including “hot” money, from one currency to another, carry out arbitrage and speculative operations.

Futures transactions with foreign currency

• Forward transactions. Their peculiarity is that the contract is signed in this moment, and the rate is fixed at the time of signing, but the delivery of the currency is planned for the future.
• Futures transactions. These are standard contracts that are signed on exchanges for buying and selling currencies. Futures have standard maturity dates. The most common is the three-month futures contract.
• Options. This financial instrument, which consists in the fact that the seller receives the right, but not the obligation, to sell a certain amount of currency in the future at a fixed price.
• Currency swap. This is an operation that combines simultaneously the purchase and sale of various currencies with immediate delivery.

Here we briefly reviewed the basic concepts regarding the foreign exchange market. As has been said more than once, the topic is very broad and multifaceted, therefore, within the framework of one article it is very difficult to analyze all possible aspects. We have given you a base, something from which you can begin to study the foreign exchange market on your own.

And at the end of the article, we offer two rather interesting videos that will further expand your knowledge about foreign exchange markets, their structure, interaction, features of functioning and development.

We also recommend watching another rather interesting video about the foreign exchange market. We are sure that you will be able to discover new concepts for yourself, as well as find answers to dozens of questions regarding work and earnings in the foreign exchange market.

I rummaged through my archive... it was written in September, but I think there’s nothing to rewrite or comment on...

CIA - foreign exchange market in context.

“The US government has a real and official policy.”
W. Taylor US Ambassador to Ukraine 2009

In 1972, David Rockefeller decided to become the ruler of the non-communist world. In 1973, under his leadership and with the active participation of Z. Brzezinski, (who then held a post in the US Presidential Administration as coordinator of the actions of the State Department, CIA, FBI, NSA, etc.), a Trilateral Commission was created, Closed club billionaires and their advisors. The commission brought together the heads and owners of the largest banks and monopolies in the USA, Western Europe, and Japan. Main leitmotif: in modern world the joint efforts of “private individuals” can produce more than a clumsy bureaucratic apparatus, which, moreover, is under weak, but still public control. At the end of the crisis of the 70s, the commission began its work with attempts to resolve the main economic and CURRENCY problems of the capitalist world. By a “strange” coincidence, in the early 70s, the topic of the importance of creating a world technocratic government was raised by CIA provocateurs Solzhenitsyn and Sakharov.

Do not underestimate the connection between US oligarchic clans and the CIA.

Members of the Mellon, Morgan, DuPont, Vanderbilt, Armor, Bruce, Ryan, etc. families served in the CIA. The American publicist D. Pearson wrote about the OSS, the founder of the CIA during the Second World War: “consists of bankers from Wall Street.” CIA Director Wisner, the owner of an enormous fortune, threw his salary checks into his desk and did not receive them for years (the checks were discovered after his suicide in 1957). In the governing bodies of the CIA there have always been representatives of the true masters of the United States, who gathered not to accumulate information, but to act - to ensure their class interests by methods of secret war. By the way Allen. Dulles, one of the founding fathers of the CIA, believed that the collection and processing of information should constitute no more than 1/10 of the total amount of work carried out by this agency. The creation of the CIA was an important stage in the organizational design of the US secret government, and the last attempts to bring the activities of this office under control of Congress ended in failure back in the mid-70s.

The importance of control over the foreign exchange market was indicated by the CIA in one of the first directives of the National Security Council - 4\A dated December 14, 1947: “... support political parties; quasi-military methods, including aid to insurgents and sabotage; economic activities related to foreign exchange transactions" As we see, sabotage and direct support for the rebels are on a par with currency speculation. Another, equally ancient CIA directive NSS 10/2 dated June 18, 1948 states: “... activities are planned and carried out in such a way that its source - the US government - is not externally manifested, and in the event of exposure, the US government can plausibly deny to the end all responsibility for her."
Confirmation that the directives have not lost their relevance in our time is the activity of Mr. Soros, of course, if you look at it more closely.

Of course, a legitimate question may arise: does the CIA have the resources to significantly influence the foreign exchange market? In 1975, Congressman Koch asked CIA Director Helms about the number of employees and the office's budget.
To which I received the answer that members of Congress are not required to know the CIA budget for which they vote, and the appropriations are included mainly in large appropriations for other departments. During the time of R. Reagan, even such questions were no longer appropriate. But Congressman O. Pike's commission in 1976 got to the bottom of the CIA budget. An estimate of the total expenses by eye, the commission was denied specific data, revealed an astonishing figure - no less than 10 billion dollars (and how much was not dug up?), while the official allocations for the CIA were about 3 billion, and this was back in the 70s!! ! (and today??? If there were no Al-Qaeda, it would have to be invented!!!) In relation to gold, the dollar has depreciated more than five times during this time.

The CIA's activities in the information field are widely known: from the production of porn films to the financing of radio stations like Free Europe, where S. Shuster began his career. Even in the distant 60s, about 1000 books were published with CIA funds annually in various countries around the world, not to mention periodicals. From the very beginning of its activities, the CIA has been developing methods to control the behavior of not only individuals and groups, but also society as a whole. Back in the 70s, CIA representative D. Behrend said: “We have enough doctors in any field of knowledge to staff any university.” Where is the grant-eater Hayek, so respected by our colleague eumatv, to Professor W. Rostow, a full-time CIA employee with his anti-Marxist concept of "stages of growth". I would not be surprised if the so-called technical analysis, as a program for controlling the foreign exchange market, was developed there. How could imperialism, with such a serious approach, trigger the beginning of the crisis? As an explanation, I propose to turn to the primary source of a pragmatic bourgeois society, created by the bourgeoisie for the bourgeoisie - money.

The diverse collaboration of academic science with the bourgeoisie led to serving the class interests of the ruling elite, not only in the USA, but also in Ukraine - the prostitution of science.
Political investigation bodies involved in one way or another in the fight against dissent receive a significant portion of the budget. (Military Intelligence, IRS, FBI, CIA, NSA, Police, Civil Service Commission, Department economic opportunities, passport bureau, etc.) Americans K. Osborne and A. Rosso began their joint article with the words: “In the United States, the intelligence community works more people, than in agriculture. They cost more to pay than the coal industry.”
I would also like to note the significant increase in the size of the American army in 2010, which has extensive experience in suppressing unrest in the United States (in 1967 alone in Detroit, 43 were killed, hundreds were injured, 7,200 were arrested).
Considering the CIA’s connections with the US oligarchic clans and their interpenetration, the office has unlimited resources to fulfill the main task of imperialism today: effectively exporting the crisis. That is, a global scarlet race with an inevitable, as I believe, hyper dollar in the final - the death of the scarlet herd. The class hatred of American imperialism finds its expression through the activities of the CIA, which protects and spreads throughout the world the principle underlying American statehood - the exploitation of man by man.