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sandipsarkar 6 years, 5 months ago.
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Forex market is the only market where traders can make their money. You do not have to go to and you can make money right from your home. This is one market where hedge funds can trade alongside with the small traders. If you look at this market, you will see that every trader is using dollars. If the trader is living in Canada or they are living in the Sahara Desert, they are using the dollar in their currency pairs. If you look at the Forex markets signal, you will also find that most signal providers provide signals that are with dollar currency pairs. It looks like the dollar is the major currency in the Forex market. It is indeed and 82% of the Forex trading is done by dollars. In this article, we are going to tell you how dollars can have an impact in your trading. Why it is the major currency and why traders like the dollar. This article will tell you the history of a dollar in the Forex market.
Bretton Woods system made the dollar popular
When the countries of the world entered into a gold standard where the currency of the country was measured in gold, the US provided the gold to convert their currency. The US truly entered a gold standard when their reserve of gold was very high. All the other countries were also converting their currency in gold. The value of the other currencies was measured in dollars. This was called pegged and for this pegging of the other currencies to dollars, when the Bretton Woods collapsed, it was not possible for the other countries to maintain their value of a currency.Many countries including the countries of Europe pegged their currencies with dollars and this made the dollar a popular currency when Bretton Woods collapsed. The Soviet Union also became the largest oil producer in the world and as all the prices of oil were settled in a dollar, the dollar becomes more popular. It became the currency that has been used in Forex markets ever since.
Nowadays, all the currency pairs which have a dollar in it is known as major pairs. In fact, the majority of the traders are making a huge amount of money simply by trading the Forex majors. It’s not like that you won’t be able to make money in the Forex trading industry by trading the synthetic pairs. But when you start trading the exotic pairs you need to deal with high level of market volatility which will increase your risk exposure in the financial industry.
It is also a good investment
Do not think the other currencies are bad. The price of dollar fluctuates more than the other currency and it would have been bad for dollars, but in the Forex market, this fluctuating is what makes it more popular. Traders know the price will fluctuate and they have a good chance at winning money when they are trading in dollar market.Many traders often say that there is no need to learn about the history of the Forex market. But without having a clear understand about the root of this industry it’s highly unlikely that you will be able to find the high-quality trading signals. In fact, the majority of the new retail traders are losing money due to their lack of trading knowledge and a weak foundation. If you ever meet a successful trader then ask about the history of this market. You will be surprised by knowing their depth of knowledge in this industry. As a currency trader, there are many things that you need to learn. It’s true that you can make money based on technical and fundamental analysis but in order to become a complete trader you need to have a solid grasp in every section of this market.
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