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Before You Trade

The Forex markets are different from markets you may already be familiar with, and that can require a different perspective and trading strategy. In 2005, Rick Santelli, a respected commentator on the Chicago Mercantile Exchange, once said, “This bond market is not your dad's bond market,” referring to unique changes in fixed-incomes trading behavior. Santelli's comment can just as easily be applied to the Forex market.

If you know stock markets very well in the U.S., you may be aware of their rhythms. This refers to the rises and dips in trading activity from 9:30 a.m. to 4 p.m. EST. Some of these changes in activity are based on human behavior. Just before most traders go to lunch, there tends to be a noticeable rise in trading volume as they squeeze in trades before they take their break.


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