What Is Forex Trading?
Forex, short for foreign exchange, is the largest and most liquid financial market in the world. Unlike centralized stock exchanges, Forex trading happens over the counter through electronic networks connecting banks, institutions, corporations, and individual traders.
The market operates 24 hours a day, five days a week. Currency values move as interest rates, economic data, geopolitical events, and market sentiment change.
Currency Pairs
Forex trades always involve two currencies. The first is the base currency and the second is the quote currency. The pair value shows how much quote currency is needed to buy one unit of the base currency.
If EUR/USD = 1.10, then 1 euro equals 1.10 U.S. dollars.
The most traded global pairs, usually involving the U.S. dollar, such as EUR/USD, GBP/USD, and USD/JPY.
Pairs that exclude the U.S. dollar but include major currencies, such as EUR/GBP and AUD/JPY.
A major currency paired with a less traded currency, such as USD/BRL or EUR/TRY.
The best pair depends on volatility, liquidity, trading hours, and your strategy.
More Tradable Asset Classes
Commodities
Commodities are raw materials or primary goods used in production and trade. Hard commodities include gold, oil, and silver. Soft commodities include agricultural products such as coffee, wheat, and sugar.
Indices
Indices represent a basket of stocks from a market, sector, or region. They help traders speculate on broad market performance rather than individual companies.
Cryptocurrency CFDs
Crypto CFDs let traders speculate on digital asset price movements without owning the underlying cryptocurrency. Common markets include BTCUSD, ETHUSD, LTCUSD, and BCHUSD.
Forex Trading Sessions
Market activity changes across trading sessions. Liquidity and volatility often increase when major centers overlap.
| Session | Hours (GMT-3) | Key Features |
|---|---|---|
| Sydney | 7:00 PM - 4:00 AM | Useful for AUD and NZD activity. |
| Tokyo | 9:00 PM - 6:00 AM | High activity for JPY pairs. |
| Frankfurt | 4:00 AM - 12:00 PM | Early European liquidity. |
| London | 5:00 AM - 2:00 PM | One of the most liquid sessions. |
| New York | 10:00 AM - 7:00 PM | Focuses on USD pairs and overlaps with London. |
The London-New York overlap, from 10:00 AM to 2:00 PM GMT-3, is often the most volatile trading period.
Important Risk Notice
The educational materials provided by ProyoFX are for informational purposes only and should not be considered financial or investment advice. Forex and CFD trading on margin carries a high level of risk and may not be suitable for all investors. Carefully consider your financial situation and experience level before trading.