The popularity of currencies and currency pairs.
The popularity of currencies and currency pairs
Unlike the stock market, forex does not have a physical location, such as, for example, stock exchange. It is an interbank market, influenced by all interbank transactions and is open 24 hours a day.
Most popular currencies according to the presence in trading in a currency pair:
USD – 84.9%
EUR – 39.1%
JPY – 19%
GBP – 12.9%
Other> 10% (AUD, CHF, CAD …)
All currencies together do not bring together 100% but 200%, since there are 2 currencies (the currency we sell and the currency that we buy) when trading in a currency pair.
Forex trading is quite confusing for beginners, as it does not buy and sell anything in physical form. But do not worry, you’ll get used to it quickly, it just needs to be tested.
From the table above, you can understand that the US dollar almost always appears in a currency pair. It is the most interesting for a variety of reasons:
World reserves are in US dollars.
The United States has the largest and most developed economy in the world.
They have a stable political system.
They are the world’s military superpower.
Their financial market is most developed.
Good enough for the US dollar. It is essential that this is the currency that you will most often encounter in trading, so it is important to know your current situation in the US economy, politics, and all other factors that may affect the value of the currency on the world market.
Most of forex market trading is due to speculation. Most sales and purchases are therefore made within one trading day. According to some sources, over 90% of all deals are to be concluded and terminated on the forex market on the forex market.
At certain times of the day, only certain markets are open, and we also need to know this in trading. In the following lessons, we also look at the impact of the time of day on individual currency pairs.