Before we started reviewing the FOREX market structure at a successful trader’s school, let’s see how the stock market works, which may be more familiar to you:
On the structure, the stock market is exposed to monopolization. Either way, all prices go through some big brokerage houses, which price control. This big participant is called market makers, and they can influence prices so they will bring profit to them, not to private traders.
Let’s take a look at how trading occurs on the largest trading platform, the New York stock Exchange.
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Here, for each action is responsible for experts who need to meet their customers ‘ bookings. Now imagine that at one point in the number of people willing to buy more than the seller’s total. In this case, to reduce the number of people willing to sell, this expert expands spreads to increase seller transaction costs and remove some sellers. So Professional manipulate the market for their own purposes.
Let’s break into the FOREX market structure. Unlike stock and futures trading platforms, there is no expert in the Forex market that sets the price. It is set based on the offer of thousands of traders, and at all times you get the best price. At first glance, this may seem undefended, but this is exactly what makes the foreign exchange market so attractive. If you walk down the road and see the foreign exchange point, we assure you, here you will not get the most favorable offer to change your currency, but if you collect this “converter” in one Network, you can easily find the best price offers. We hope you’ve learned a good lesson on the Forex market and you will not have a problem with it.
FOREX Market Structure
There are many participants in the Forex market, but this does not mean that there is a complete chaos in this market. All participants can be represented as sequential hierarchy, such as in this picture:
On the top of this staircase is a large international Bank that trades between them through the EBS system called or through the Via electronic system of Reuters tackling 3000-place.
The system competes with each other such as Coca-Cola and PEPSI, and is trying to offer their clients the best trading conditions. Of course, each of these systems has the advantages and cons. For example, for some currency pairs, a trading system can provide more liquidity than others. The EBS system can provide more liquidity in such currency pairs as: EUR/USD, USD/JPY, EUR/JPY, EUR/CHF and USD/CHF, on Turn Reuters brings in the currency pair as: GBP/USD, EUR/GBP, USD/CAD, AUD/USD and N I/USD.
Read the Forex market participants