Foreign Exchange
Foreign exchange trading is the simultaneous buying of one currency and selling of another. The foreign exchange market (Forex or FX) is the largest financial market in the world with a daily turnover of over $1.3 trillion. Examples of currency trading pairs are Euro/US Dollar (EUR/USD) and US Dollar/Japanese Yen (USD/JPY). Most currency transactions involve the "Majors"-the US Dollar, Euro, Japanese Yen, British Pound, Swiss Franc, Canadian Dollar and Australian Dollar.

Unlike other financial markets, the foreign exchange market has no physical location and no central exchange. The Forex market operates 24 hours a day through an electronic network of banks, corporations and individual traders. Forex trading begins every day in Sydney, then moves to Tokyo, followed by London and then New York. The major market makers, or dealers, consist of the commercial and investment banks, the exchange traded futures, and registered futures commission merchants such as FX Solutions. FX Solution's dealing desk is open 24-hours a day from Sunday 14:30 EST to Friday 16:30 EST.

Foreign Exchange Prices
Foreign exchange markets and prices are mainly influenced by international trade flows and investment flows. The FX markets are also influenced, but to a lesser extent, by the same factors that influence the equity and bond markets: economic and political conditions especially interest rates, inflation, and political instability. Those factors usually have only a short-term impact, which makes Forex attractive-it offers the investor some of the diversification necessary to protect against adverse movements in the equity and bond markets.

Foreign Exchange prices, or quotes, include a "Bid" and "Ask" similar to other financial products:
Bid: Price at which Dealer is willing to Buy and Traders can Sell Currency
Ask: Price at which Dealer will Sell and Traders can Buy Currency

The difference between the Bid and Ask is called the "Spread", which is the Trader's cost of the transaction. For more information on the Spreads offered by Infinity click here.

Currencies are usually quoted to four decimal places, such as the Euro/US Dollar trading at 1.2400/1.2403, with the last decimal place referred to as a point or "pip". A pip for most currencies is 0.0001 of an exchange rate; the one exception is the USD/JPY quote in which each pip is equal to 0.01.

Analysis of Foreign Exchange Markets
Foreign exchange traders base their decisions on technical analysis and fundamental analysis. Technical traders use charts, trend lines, support and resistance levels, mathematical models and other means to identify opportunities and drive trading decisions. Click here for more information on Technical Analysis. Fundamental traders identify trading opportunities by analyzing economic information. Click here for more information on Fundamental Analysis.

Compliance
There is no central market and no global regulatory agency responsible for monitoring the activity of the currency markets. Regulation is left to each country, in the United States the Federal Reserve Bank monitors the banking system and the Commodity Futures Trading Commission (CFTC) has jurisdiction over all Futures and Forex activity. When trading in the foreign exchange markets, individuals should only trade with a CFTC registered entity, such as FX Solutions/Infinity. FX Solutions/Infinity is registered with the CFTC as a Futures Commission Merchant and is a member of the National Futures Association. For additional information on Infinity's compliance programs click here.