Forex charts movement?
Mi R asked:
When you look at the chart for any currency pair you can see that it moves basicly every second and the reason for that movement is because of the supply and demand.But how does a computer based chart calculate the supply and demand for a currency at a given time?Or in on the other hand,how can i calculate the supply and demand for a currency at a given time.
When you look at the chart for any currency pair you can see that it moves basicly every second and the reason for that movement is because of the supply and demand.But how does a computer based chart calculate the supply and demand for a currency at a given time?Or in on the other hand,how can i calculate the supply and demand for a currency at a given time.
Also if i buy eur and sell the dollar online am i increasing the demand for the eur or does that only happen if i do that with real money at a bank..?
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Second part of the question: Since millions are traded on line every minute, you singally don’t make a difference, it is the institutional players that get in and out for just a few pips on millions invested that move things along.
All there is is price, volume, and time. At a particular time, a buyer and a seller agreed on a price and exchanged a certain volume at that price. Could be said for stocks, commodities, currencies, or corn dogs Now if someone is willing to pay more than the last guy, prices go up and we SAY there is more demand than supply. Or vice versa. But in truth at any particular price and moment in time when a transaction is made, supply and demand are in perfect balance. The only time they are out of balance is when a market lock limits, or is closed, or prices are artificially set by government.
If you buy euros in the forex market, you increased demand for them at that particular instant right before you bought them. But unless you are going to use them for something, those Euros are also future supply at some point when you try to sell them.
The computer makes estimates, it doesn’t and can’t do actual calculations of market prices.
The currency market is a 6 TRILLION dollar market worldwide. If you buy euros and sell dollars you are increasing the demand for euros, but only by a smidget. In a 6 TRILLION dollar market, you make very little difference.
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It gives you a 5-step beginner’s guide on how to profit from Forex – showing you how to do stuff like set up a demo account and get trading live.
I highly recommend it – and it’s free.