Forex day trading has many advantages over other forms of financial trading. The biggest advantage is that it is a 24-hour market. This gives the traders a chance to choose their own hours to trade. They don’t have to panic, and rush, if one currency peaks or hits a trough. They can decide when to make their moves.
They can also start small, a luxury that is not available in the stock markets, and concentrate on a few major currencies than on tens of thousands of stocks. This gives them better focus and allows a better spread of their investment.
Another useful point is that the spreads are narrower, and a trader can regulate the day spends better. The traders also enjoy superior liquidity because the forex market is the largest financial market in the world and works round the clock.
Also unlike stocks, there are no restrictions to sell currencies short. This makes it feasible for the forex trader to make money equally in both rising and falling markets.
The hourly foreign currency trading volume is determined by the markets that are open at that particular point of the day. This volume shoots up when the British, European and U.S. markets are trading together, that is from 1 p.m. GMT to 4 p.m. GMT. This is when the most frenzied activity is seen in the market.
The volume of the Pacific Rim markets, such as Japan and Hong Kong, is very small as compared to the U.S. market, but it still offers the forex trader an ability to analyse the highly traded Pacific Rim currencies, and make suitable investments.
There is little doubt that foreign exchange trading is one of the most lucrative and promising businesses today. The professionally managed forex brokers and agents have almost all the standard features like 24-hour online currency trading, 100-to-1 leverage, commission-free trading and regulated FCM status to take full advantage of this unique market.