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Markets — Foreign exchange

Currencies move on policy, positioning and surprise.

The FX market is the largest and most liquid in the world. Understanding why a currency moves matters more than memorising a pair.

Educational overview. Not investment advice and not a recommendation of any instrument.

EUR / USD FX
Chart by TradingView

Embedded chart for information and education only. The instrument shown is not a recommendation.

At a glance

Key characteristics

Market Foreign exchange
Typical sessions Sydney, Tokyo, London, New York
Most active overlap London / New York
Quotation convention Base currency vs quote currency
Primary drivers Rates, inflation, growth, flows

Risk note

Leverage can magnify losses as well as gains. Understand the instrument, its liquidity and your own tolerance for loss before taking a position.

What moves this market

The drivers worth following.

Interest-rate differentials

Yield expectations influence capital flows and relative currency demand.

Central-bank policy

Forward guidance and the tone of policy statements can reprice a currency quickly.

Inflation and growth

Data that changes the outlook for policy tends to move FX more than data that confirms it.

Risk sentiment

Safe-haven and funding currencies behave differently when volatility rises.

Liquidity and sessions

Spreads and depth vary by session and around scheduled events.

Positioning

Crowded views can amplify moves when the narrative shifts.

How to approach it

A framework, not a forecast.

Use these questions to structure your own research. They are prompts for thinking, not trading instructions.

Build the fundamentals
01

What is the dominant macro theme for this pair, and is it strengthening or fading?

02

Which central banks set the policy path, and when is the next scheduled communication?

03

How does the pair behave across sessions — does the trend hold or fade?

04

Where is the invalidation point for your view, and what position size keeps the loss defined?

05

Is a scheduled event close enough that gap and slippage risk must be considered?

Continue

Go deeper into currencies.

Read the digital-asset and index overviews, or start with the market foundations track in the education hub.