Daily, the forex market is worth $6.6 trillion, bringing the overall value of the global forex market to $2.409 quadrillion in 2021. This makes this currency trading market one of the biggest, and most lucrative, markets in the world.
It’s understandable, therefore, that people are drawn to this type of trading. Even as we’re seeing huge economic fluctuations globally, forex remains popular. It helps that the world’s reserve currency, the US dollar, appears stronger in 2022, as this places traders in a good position.
The way we trade forex has changed significantly over the years. This is largely down to advancements in tech. Here, we look at how technology has been beneficial for this type of trading.
Forex is a fast-paced market. While speed and efficiency are crucial across all the trading types, forex is one market where time is a commodity that traders don’t have. Therefore, any technology that can speed processes up is hugely beneficial.
One of the main tools that has benefitted from new technologies is conversion calculators. Where before this was all done manually, changing technologies have made it possible for calculating currency spreads and pairs quickly.
This is especially helpful when looking at pips – or point-in-percentage, which is the minimum price that a currency pair can make. In forex trading, an online pip calculator can show at-a-glance guides to where the pairs currently stand so traders can jump in and make their move.
In the past, you had to be on the trading floor in order to know exactly what the market prices were. This excluded so many people from accessing the forex markets as it was only the privileged few who were able to access the London Stock Exchange and Wall Street.
Advancing tech has changed the playing field completely. Now, pretty much anyone with access to the internet can set up an account and access live market prices as they happen via trading platforms. This has made forex accessible and more competitive.
As well as giving more people access to the forex markets, new tech makes the markets accessible from anywhere in the world. Mobile access via smartphones and tablets has meant that the current numbers can be checked on-the-go, at different times of the day.
Also, it’s meant that people can either make a career of it or work full time a completely different role and choose to have forex trading as a side hustle. Trading platforms offer flexibility that didn’t exist before.
Social media has also played a significant role in forex trading. As with most industries and sectors, social channels have opened up new ways for traders and brokers to communicate with each other. They can network, get tips, and work together on trade deals. This access to social media platforms makes forex trading less isolated than it was before and has created a sense of community.