The most important currencies in the Forex market

Forex market differs from other financial markets two things, one is that it is not used as a vehicle financial traditionally. It was and is still - more utilitarian purpose. In today's globalized economy, the majority of the business kind of global presence, which creates the need to replace one currency for another in order to complete transactions.

Since the seventies of the last century, the majority of the major currencies in the world are (mostly) on the way the exchange of free-floating, so as to allow for the exchange rates to be determined based on market forces, which is supply and demand. We say "mostly" because there were some times where some of some of the countries central banks had to intervene in the market to manipulate currency exchange rates through their buy or sell large amounts of currencies of their country, but it is natural that such things only happen in cases maximum.

There are also other central banks choose to manage their currencies more stringent manner, but such banks are considered a minority in the contemporary world. So, in most cases, the free-floating way in exchange for allowing currencies to fluctuate against each other more, and this opened the door for future movement of the currency rate expectations. Strong knowledge of the Forex markets, banks, and big capital available to them level, enabling them to be the first to speculate in the Forex market, and increase their profits significantly this way. However, the consequences of non-commendable for this leads to was the lack of liquidity in some cases, and has not been able to complete some necessary transactions.

In order to solve this problem, banks have increased the number of participants in the market through annexation of those non-bank, and thus get a large flow (cash distribution) in order to complete customer transactions, and also to make a profit from the new participants and non-experts in the market . One of the traders in the Forex inexperienced at the beginning of large cash funds (such as the famous) Quantum Fund, and include, but today even the local forex broker.

Another unique feature of the Forex market is that the market directly, "table-top", meaning that there is no central initiates (such as the stock market) transactions take place. Instead, transactions are first-class in the "internal interbank market", which is a variety of the largest financial world's central banks, which allowed them all currency trading among themselves on the prices at which they agree. It may be difficult to know the way in this big maze, so the smart people in leading the development of "mediation-mail system" EBS, to allow participants to see the other prices, which is accepted by the other traders banks. As it has been the development of a competitive system by "Reuters" (D2). Today is one over the other's preference is mostly depending on the currency pair you want to trade him, as the EBS is used usually with the euro / US dollar pairs, the US dollar / Japanese yen, the US dollar / Swiss franc, the euro / Swiss franc. While "Reuters de 2" is used for all other currency pairs in. In 2006 the company ICAP acquired EBS. Please be aware that while these services provide centralized combination of price information, they do not constitute a central exchange. Forex market and the market is still "on the table" dramatically.