Forex Signals

The speculator aim in Forex trading is to profit from the movements of foreign currencies. The price of currency pair is referred to as a "Forex rate" or just "rate" for short. The proof that forex is really good investment option we need to compare it to other similar solutions. At its very minimum, the return on investment in forex should be compared to the return on the so called "risk-free" investments. Classical example of a risk-free investment is the U.S. government bonds because practically there is no chance for a default or the U.S. government going bankrupt.

If you are trading currencies, it is advisable to trade only when your expectations are that currency you are buying is going to increase in value compared to the currency you are selling. If it happens, you should sell back the other currency in order to lock in a profit. This open trade (sometimes called “open position”) is a classical example of trade in which the player has bought or has sold a particular currency pair and relatively has not yet sold or bought back the equivalent amount in order to close this position.

It is clear that about from 70% to 90% of the forex market is exclusively speculative. People and institutions that bought or sold the currency have not planned to actually take delivery of the currency at all. Their sole purpose is to gain profit.

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