Today we are gonna start this lesson by analyzing some of the current currency trends.We’ll start with the exchange rate of the dollar to the pound. The dollar is known to be a very strong currency meaning it is not subject to large losses and constant fluctuations in market value. The present dollar/pound ratio is as follows:
As of today the BPD/USD exchange rate is 1/1.57150 meaning the equivalent of one British pound is 1.57150 US dollars.
If at 2:00pm GMT the exchange rate was 1/1.57001 with a decrease of 0.00149 US dollars I would gain if I had analyzed that the market value of the dollar would rise at say current time 6:44pm GMT.On the other hand I would have lost if I had predicted the market value to depriciate. This is one very important aspect of the FOREX market that is understanding the factors that affect the rise and fall of the dollar and the seasons as well. I say seasons because in say December the dollar might lose value cause the British pound gained in percentage value on international trade and commodities such as gold, oil e.t.c.
To avoid misunderstanding the trends it is essential to make use of prediction software and of course real life practical analysis. The software analyzes the past and present trends in order to predict the future trends. The essence of real life analysis is to understand how the currency being studied shrinks or grows with time, season and the international economy as a whole.