Forex trading is one of the most popular methods of trading in the world, with daily trading volume touches U.S. $ 4 trillion! Some of the reasons usually given for the high popularity of Forex trading is an approach provides up to 24 hours markets, high leverage, and provides a high level of liquidity on offer. When spread betting, or CFD trading on the forex market, however, it is important to understand the difference between the most traded currencies in the Forex market.
U.S. Dollar: Trade with the U.S. dollar is one of the most popular form of Forex trading, especially since the currency acts as unofficial global reserve currency in the Forex market. Are held almost every central bank and institutional investment organizations around the world and some countries used as official currency, instead of local currency. In financial markets the dollar is also used as the standard currency for most commodities such as crude oil and precious metals. These goods are subject to changes in the value of the dollar value is always sensitive to changes in inflation and interest rates.
Euro: Relatively new on the market, Forex trading, the euro was adopted quickly Forex traders and quickly went on to become the second most traded currencies on the Forex. Euro is also the world's second largest reserve currency. Many African nations peg their currencies to the euro to stabilize. Euro a reliable currency in the Forex market and adds liquidity to any currency pair trades.
Japanese yen: Japanese Yen is the most traded currency in Asia because of the perceived strength of Japanese manufacturing.Jen is specifically used to carry trade because of the zero interest rate policy of the Japanese government for much of 1990 and the 2000s. Forex trading allows a trader yen currency option costs less to borrow and invest in other high yield valute. Exchange rate are relatively low risk, and therefore a safe investment.
British Pound: Pound sterling is the fourth most popular currencies in the Forex market. It also acts as a reserve currency in the Forex. Britanska pound is highly liquid and considered safe investments.
Swiss franc: Swiss franc has been viewed by many as a neutral and safe haven currency in the Forex market trading. Franc usually traded in a relatively narrow range to reduce volatility and keeps interest rates in line.
These are the most traded currencies. Spread betting and CFD traders who want to enter the Forex market are advised to carefully study the price patterns and behavior of these currencies in order to forecast their future trends better.