What is Forex for speculation?
The variability in the forex market depends upon various factors like
The changes offer the opportunity to earn maximum profit that may vary (either increase or decrease) the currency’s value. A prediction suggests that if one currency is strong, the other one will weaken automatically because the currencies are always exchanged as pairs.
Consider a marketer who wants the increase in the interest rates in the USD instead of AUD; however, both the currencies share the exchange rate of 0.71 (means one can buy AUD 1 is only USD 0.71). The marketer expects the rise in the interest rates of the US as it will boost the need for USD. Ultimately the exchange rate of AUD/USD will decrease as it will need limited USD to purchase AUD.
Suppose that the marketer is true and interest rates increase, and such a rise lowers the exchange rate of AUD/USD to 0.50. This suggests that it takes USD 0.50 to purchase AUD 1.00. If the stakeholders buy a huge amount of USD and provide less than the labeled amount of AUD, they would earn more profit.
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