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International Finance: How to Predict the Potential Price Movements in the FOREX Market


Foreign Exchange Market: How to Predict Price fxcm markets Movements Introduction: The Foreign Exchange Market, Currency Market or.



International Finance: x crypto coin How can you predict price movements in the FOREX Market

Introduction:

The Foreign Exchange Market, Currency Market, or FOREX imp source Market refers to a global exchange that allows for decentralized trading in international currencies. The financial centers of the world are the anchors for trading among a variety of different buyers and sellers, Guest Posting except on weekends. EBS and Reuter's dealing 3000 are two main interbank Foreign Exchange trading platforms. The foreign exchange market determines the relative values of different currencies.

Currency conversion is one way the foreign exchange market helps international trade and investments. For example, it permits a business in the United states of America to import goods from the European Union member states especially Euro-zone members and pay Euros, even though its income is in US Dollars. It also supports direct speculation in the value of currencies, and the carry trade, speculation based on the interest rate differential between two currencies.

Major Factors to Predicting Forex Market Movements: To profit from the fascinating world of international trade, you must have a firm grip on the key factors that affect a currency's value. When making our trades, we analyze five key factors. In order of importance, they are:

1. Interest Rates

Economic Growth

(3) Geo-Politics

(4) Trade and capital Flows

(5) Change of Commodity Price Index

Mergers and Acquisitions Activity

Out of these factors, here I'm discussing about change of Commodity Price Index or " How to use commodity price to predict the potential price movement in the FOREX Market".

The discussion above shows that many factors can affect the forex market, such as supply and demand. Interest rates, economic growth, and so on. Besides this, traders should also know that certain currency pairs can be greatly influenced by the price of some commodities such as oil.

Which currencies are closely related with the price of commodities on the FOREX Market?

The economic strength of a nation is directly related to the domestic industry as well as its international trades. The price of commodities produced by a particular country can have a significant impact on the value of its currency. The survey found that the Australian dollar, which is a leading producer of precious metals such as gold and the Canadian dollar, which is a leading crude oil producer are the three top currencies with the strongest correlations to commodities. Other currencies that are also impacted by commodity prices but have a weaker correlation are the Swiss Fanc, New Zealand Dollar and the Japanese Yen. Knowing which currency is correlated to what commodity will help traders better understand the potential market movement of certain currency pairs.


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