FOREX, or foreign exchange market plays a major role in contributing to the economy throughout the world. As the name suggests, FOREX basically accounts for the trading of foreign currencies and is no doubt, the largest over-the-counter market throughout the world and also the most liquid market and this trading is carried out among the participants from different parts of the world, through electronic communication networks. By 2010, FOREX had expanded up to a daily average of US$4 trillion across the globe.
Most of the deals that take place in the foreign exchange market are through a certain process called as day trading. This day trading again, as the name suggests, refers to trading i.e. buying and selling of financial entities like the stocks, currencies, and so on, and is always finished in a single trading day when all the positions are closed in a trading day before a market closes. And when referring to the currencies day trading, as mentioned previously, is the day trading of the currency of various countries and this trading of currency always occurs in pairs. For example, the currencies US dollar and Euros: the buyer will first see if the value of the currency he buys is higher compared to that of the other currency.
The currencies market day trading involves an element called the currency day trading system which provided an analysis to the day trader and this analysis helps the day trader to determine the further action of selling or buying of a pair of currency at any given point of time. These currency day trading systems are of two types: manually operated, and automated.
In a manually operated trading system, an operator or trader sits in front of a computer screen and searches for any kinds of signals which could further help him/her determine whether to buy or to sell the currency. But, in an automated system of trading, the software is taught how to interpret the signals by the operator in terms of a program.
If anyone plans to begin trading in a currency market, it is relatively easier to start, compared to that in the stock market, as there are only few major currencies that are traded. But, currency trading also involves high risk and might not suit everyone’s interest and therefore, before beginning any trading, one should carefully consider the amount of experience they have and also should not invest the amount that they cannot afford to lose. Therefore, it is always advisable for the beginners to consult financial advisers before getting into the currency day trading.