Forex, also known as the foreign exchange market or FX market, is the largest financial market in the world. It is a decentralized marketplace where currencies are traded and exchange rates are determined.
In the forex market, currencies are always traded in pairs. For example, the EUR/USD pair represents the exchange rate between the Euro and the US Dollar. When you buy a currency pair, you are effectively buying one currency and selling the other.
The value of a currency is determined by its supply and demand in the market. When there is strong demand for a particular currency, its value will generally increase, while a decrease in demand will lead to a decrease in value.
Exchange rates are constantly changing as the supply and demand for different currencies shifts. Forex traders aim to buy and sell currencies in order to profit from these changes in exchange rates.
Traders can participate in the forex market through a broker or a trading platform. They can buy and sell currencies using various financial instruments, such as spot contracts, forwards, futures, and options.
The forex market is open 24 hours a day, five days a week, which allows traders to react to news and events as they happen, no matter where they are in the world. However, the most active trading times are typically when the major financial centers, such as London, New York, and Tokyo, are open for business.