Traders in FX trading could be grouped into one of four types- bankers, agents, customers and banks. Banks alongside other associations do the lion’s share of trading. They make profits selling and buying currency to one another. Roughly two thirds of Forex transactions involve banks dealing together. Dealers or Agents act as intermediaries between dealers looking for a deal, helping them the banks find out where they could get the best currency trade. Sellers and buyers like since they can trade via intermediaries, working through agents or traders. By charging a commission Agents make profits on currency exchanges. Clients, which are businesses, trade currency they invest or can operate.
Have their own gambling desks, while others conduct their money trading through banks or brokers. Banks such as their US Federal Reserve, acting on behalf of the governments take part in the Forex market to affect the value of their countries currency. As an example, if the Federal Reserve considers the dollar is weak, it promote banks of other nations to do the same from the Forex market to elevate the value of the dollar and even may purchase dollars. Among the lots of factors that influence the value of a country’s money are business cycles, political developments, changes from tax regulations and stock market news.
Traders must monitor all of these possible factors so that they could stay on top of political or economic changes that affect the value of the currency they hold. Currency trading, like other types of trading, is impacted by the fundamental economic principle of supply and demand. When a large amount of one kind of money is available for sale, their market can be invaded by it and the cost of the currency drops. When the supply of money is low and the demand for it’s high, then the value of the currency rises. FX Trading .