If you ever travel to another country, you usually have to f forexcashbackcalculatord an airport currency Eastforexcashback booth East forex cashback exchange that countrys currency You go to the counter and see the different foreign currency rates d cashbackforexbtcplayed on the screen You find that one dollar is worth a hundred yen and you think, "Wow! I have ten dollars, Im going to be a rich man!" (This exciting moment quickly wears off because half of your money is gone by the time you buy a can of soda at the airport store.) When you change to another currency, youve basically engaged in a foreign exchange cashback forex transaction! For example, if you are an American visiting Japan, you are already involved in forex trading when you sell dollars for yen When you stop at a currency exchange booth before you are ready to go home and try to exchange your unused yen back, (spending in Tokyo is expensive and if you have money left over this is pretty incredible), you will find that the exchange rate has changed The change in the exchange rate is what allows you to trade in the forex market Some of the changes in the foreign exchange market, often called the "foreign exchange market", or simply "FX", it is the worlds largest financial trading market than the New York stock market with a daily turnover of $ 74 billion, the foreign exchange market with a daily turnover of $ 5 Our foreign exchange market is very powerful! Lets use the monster in the following chart compared to the New York Stock Exchange when this "monster" meets the foreign exchange market, you will see the following scene ...... Wow, the New York Stock Exchange and the foreign exchange market size compared to, is simply small to see a big witch the following chart is the New York Stock Exchange (Note: According to the Bank for International Settlements in 2013, the Bank of International Settlements published a triennial report, the foreign exchange market daily trading volume of 5.3 trillion U.S. dollars) the size of the currency market to 53 times higher, is indeed quite large! But dont worry, one thing to note is that the $5 trillion size is for the entire global foreign exchange market, however, retail traders (i.e. FX retail investors) trade in the spot FX market at about $1.49 trillion So you see, the FX market is indeed very large, but not as large as the media expects you to think Are you now aware of the full extent of the FX market? We are just at the beginning! In the next lesson, we will learn what exactly is traded in the Forex market. What is traded in the Forex market is very simple, it is traded "money" because you are not buying something per se, so this kind of trading can confuse peoples perception of trading by treating the purchase of a currency as a purchase of shares in a particular country, which is a bit like buying shares in a company. The price of a currency directly reflects the markets judgment of a countrys current and future economic conditions. Once you sell those "shares" to the market, your hope is to make a profit from them. Generally speaking, the exchange rate between a countrys currency and the currencies of other countries reflects a comparison between the economic conditions of that country and those of other countries. The first two letters represent the country or region, and the third letter represents the currency of the country or region Take NZD, NZ stands for New Zealand (NewZealand), and D stands for New Zealand Dollar. We will also let you know that "buck" is not the only nickname for the U.S. dollar and that nicknames for the dollar include: greenbacks, bones, benjis, benjamins, cheddar, papar, loot, scrilla, cheese, bread, moolah Did you know that in Peru, the nickname for the dollar is Coco, the name of a pet called Jorge (George in Spanish), and that the portrait on the $1 bill happens to be that of George Washington, the first president of the United States? When you trade in the foreign exchange market, you are buying and selling currency pairs, and we can think of each currency pair as a "tug of war" between different currencies. "The fluctuations in the exchange rate depend on the strength or weakness of the currency at a given point in time The currency pairs listed in the table below are what we call "major pairs", or "straight". These pairs are the most liquid and widely traded currency pairs in the world. The three major currencies other than the US dollar: the Euro, the Japanese Yen and the British Pound Euro Crosses Yen Crosses British Pound Crosses Other Crosses Other Country Pairs Other Country Pairs are made up of a major currency country and other emerging economies such as Brazil, Mexico or Hungary The icons below show some exotic pairs. Through your forex broker, you may see the following exotic pairs. Please keep in mind that these pairs are not traded in as large a volume as the major pairs or crosses, and therefore, their trading costs are usually higher. If you want to know which currency pairs you can trade on your trading platform, you can see them on the left side of your trading platform: right-click on the currency pair and select "Show All" to see All the instruments you can trade now