The foreign exchange market, commonly known as Forex or FX, is the world’s largest financial market. It is a decentralized market where currencies are traded in real-time, 24 hours a day, five days a week. The Forex market is open for trading across various time zones, with trading activity peaking during the overlap of the London and New York trading sessions.
The Forex market is a global market with a daily turnover of more than $6.6 trillion, making it the most liquid and largest financial market in the world. The Forex market operates on a continuous basis, allowing traders to buy and sell currencies as prices fluctuate.
The Forex market is made up of various participants, including central banks, commercial banks, hedge funds, retail traders, and individual investors. These participants trade in large volumes, making the Forex market highly liquid and volatile.
The Forex market’s daily turnover is a crucial indicator of its liquidity and trading activity. The daily turnover is the total value of all currencies traded in a day. The Forex market’s daily turnover has been increasing steadily over the years, reflecting the growing demand for currency trading.
According to the Bank for International Settlements (BIS), the Forex market’s daily turnover was $6.6 trillion in April 2019, up from $5.1 trillion in 2016. This represents a 30% increase in three years, highlighting the Forex market’s growth and popularity.
The Forex market’s daily turnover is divided into three major trading sessions: the Asian session, the European session, and the American session. The Asian session starts at 4:00 PM EST and ends at 1:00 AM EST. The European session starts at 3:00 AM EST and ends at 12:00 PM EST. The American session starts at 8:00 AM EST and ends at 5:00 PM EST.
The European session is the most active session, accounting for 36.9% of the daily turnover. The American session is the second most active, accounting for 37.6% of the daily turnover. The Asian session is the least active, accounting for 14.6% of the daily turnover.
The Forex market’s daily turnover is affected by various factors, including economic data releases, geopolitical events, central bank policies, and market sentiment. Economic data releases, such as GDP, inflation, and employment data, can cause significant price movements in the Forex market. Geopolitical events, such as elections, wars, and natural disasters, can also have a profound impact on the Forex market.
Central bank policies, such as interest rate decisions and quantitative easing programs, can affect the value of currencies and the Forex market’s trading activity. Market sentiment, which refers to the overall mood of traders and investors, can also influence the Forex market’s daily turnover.
In conclusion, the Forex market’s daily turnover is a crucial indicator of its liquidity, trading activity, and popularity. The Forex market’s daily turnover has been increasing steadily over the years, reflecting the growing demand for currency trading. The Forex market’s daily turnover is divided into three major trading sessions, with the European session being the most active. The Forex market’s daily turnover is affected by various factors, including economic data releases, geopolitical events, central bank policies, and market sentiment.
