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Why do forex charts start in 1995?

Forex charts are an essential tool for traders to analyze price movements and make informed decisions. These charts provide a visual representation of market data, allowing traders to identify patterns and trends that can help predict future price movements. However, many forex charts only go back to 1995, leaving many traders wondering why this particular year was chosen as the starting point for charting forex data. In this article, we will explore the reasons behind this and explain why forex charts start in 1995.

The Birth of the Modern Forex Market

The forex market has a long and complex history, dating back to the 19th century when the gold standard was first introduced. However, it wasn’t until the 1970s that the modern forex market as we know it today began to take shape. At this time, the Bretton Woods system, which had tied the value of most currencies to the price of gold, was abandoned, and the market was allowed to float freely.

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This led to a surge in currency trading as traders began to speculate on the value of different currencies. However, it wasn’t until the 1990s that the forex market really took off. This was due in part to advances in technology that made it easier for traders to access the market and new financial instruments such as currency futures and options that allowed for more sophisticated trading strategies.

The Role of the Internet

The rise of the internet in the 1990s had a significant impact on the forex market. Prior to this, trading was largely conducted over the phone or through brokers, making it difficult for individual traders to access the market directly. However, with the advent of online trading platforms, traders could now access the market from anywhere in the world, 24 hours a day.

This led to a surge in demand for forex data, including price charts that could help traders analyze market trends and make informed decisions. As a result, many charting platforms began to offer forex charts, but they typically only went back to 1995.

The Limitations of Historical Data

One reason why forex charts start in 1995 is that this is when the euro was introduced. Prior to this, the forex market was dominated by a handful of major currencies, including the US dollar, British pound, and Japanese yen. However, the introduction of the euro created a new dynamic in the market, with traders needing to track the value of this new currency against other major currencies.

Another factor that contributed to the 1995 starting point for forex charts is the limitations of historical data. While there is some data available for the forex market prior to this, it is often incomplete or unreliable. This is due in part to the fact that the forex market was largely unregulated prior to the 1990s, making it difficult to obtain accurate data.

Additionally, even the data that is available prior to 1995 may not be useful for traders. This is because the forex market was much less liquid and volatile prior to the 1990s, with fewer traders and less sophisticated trading strategies. As a result, the patterns and trends that traders would be looking for in historical data may not be present or may not be relevant to the current market.

Conclusion

In conclusion, there are several reasons why forex charts start in 1995. This was a time when the modern forex market was taking shape, with advances in technology and the introduction of new financial instruments driving demand for forex data. Additionally, the introduction of the euro created a new dynamic in the market that traders needed to track. Finally, the limitations of historical data mean that the data available prior to 1995 may not be useful for traders. While forex charts may not go back as far as some traders would like, they still provide a valuable tool for analyzing market trends and making informed trading decisions.

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