Читать книгу 4 Keys to Profitable Forex Trend Trading - Christopher Weaver - Страница 4

Introduction

The currency pairs which make up the foreign exchange market provide us with some of the most reliable trading trends. This is due to the high daily liquidity, or volume, of the market. The foreign exchange (forex) market as a whole trades around US$4 trillion every day - far more than all of the major stock markets in the world combined. All of this trading creates strong trends!

For instance, look at the EUR/USD currency pair.

Figure 0.1: major trends in EUR/USD

Of all of the currency pairs that make up the forex market, none is traded as heavily as this one. This means that whatever direction this currency pair is moving in, there is a huge amount of money backing it. It is believed that there is nearly US$1 trillion of trading volume per day on this currency alone. If it is trending up, it will require something dramatic to sufficiently turn the sentiment of the buyers into sellers and shift the trend.

Compare that to an obscure stock listed on a minor stock exchange. The smallest bit of news regarding the company, or the change of opinion by just a handful of stock holders, can turn an uptrend into a downtrend very quickly.

Liquidity is the key in providing reliability for trend trading - this is good news for the forex trend trader.