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Know Your Enemy
What is the Forex market?
Forex is one of many financial markets in the world. It is the largest with an average daily volume traded being close to $2 trillion, that's right $2 trillion. London is the world's largest foreign exchange centre: average daily turnover is $637 billion. Now some of that money is not up for grabs by retail traders like us but then again some of it is. What does this mean for you? It means that, if you learn to trade and take it slow, you can be grabbing part of that $2 trillion daily. If however you want to be Rambo and go in guns blazing, the market will put you in your place.
Location?
Unlike some financial markets, the foreign exchange market has no physical location. Forex is not dealt across the floor like on Wall Street. It is traded via telephone and the internet.
When does it sleep?
It doesn't! Well at least not on week days. The market is open 24 hours a day 5 days a week. During the week there is always a country open for trading that's willing to take your money. They used to say "the sun never sets on the British Empire." Well today that is true for the Forex Empire. The picture below shows how the times the market opens and closes around the world:
What you trade
Short answer is you trade currencies. In the next section we will get into more detail.
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