Learn the general concepts of financial markets and economy. You will see the difference between primary and secondary markets and learn about markets for different products. You will also look at various economic Indicators and their influence on the markets. After completing this course, you will have a much stronger background of financial markets and ready to go to the next stage in the Specialization. This course is designed to help students with very little or no finance background to learn the basics of investments.
2. Around the world in a trading day : A round up
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From the course by Indian School of Business
Introduction to Financial Markets
585 ratings
Indian School of Business
585 ratings
Course 1 of 5 in the Specialization Financial Markets and Investment Strategy
From the lesson
Currency Markets
In this module you will be exposed to currency markets and different currencies traded in these markets. The they are given a brief overview on how to trade in the currency markets.
Meet the Instructors
Vaidya NathanLecturer
Finance
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Learning outcomes.
After watching this video, you'll know the importance of currency markets,
and its relation to other markets in the world.
You'll also know how news and data affect currency markets.
The Forex Market is open and active 24 hours a day from the start of
business hours on Monday morning in the Asia Pacific timezone straight through
to the Friday close of the business hours in New York.
At any given moment, depending on the timezone dozens of financial centers
such as Sidney, Tokyo, London are open and
currency trading desks in those financial centers are active in the market.
Currency trading doesn't even stop for
holidays when other financial markets like stocks or future exchanges may be closed.
Even though it's a holiday in Japan, for example, Sydney, Singapore,
and Hong Kong may still be open.
It might be the 4th of July in the US,
which is Independence Day of the United States, but if it's a business day, Tokyo,
London, Toronto and other financial centers might still be trading currencies.
About the only holiday in common around the world is the New Year's Day and
sometimes Christmas, and even that depends on what day of the week it falls on.
As regards the opening of the trading week,
there is no officially designated starting time to the trading day or week.
But for all intents and purposes the market action kicks off
when Wellington in New Zealand, the first financial center
west of the International Date Line opens on Monday morning local time.
Depending on whether daylight saving time is in effect in the timezone,
it roughly corresponds to early Sunday afternoon in North America.
And it corresponds to Sunday evening in Europe, and
very early Monday morning in Asia.
The Sunday open represents the starting point where currency markets
resume trading after the Fridayclose of trading in North America,
which happens at 5 PM Eastern time in the US.
That's the Friday close.
Now, Sunday, Monday morning is the first chance for
the Forex Market react to news and events that may happen over the weekend.
Prices may have closed while in New York on Friday, trading at one level.
But depending on the circumstances,
they may start trading at very different levels at the Sunday open,
which is basically Monday morning in Asia, especially in investor in New Zealand.
Trading in the Asia Pacific currency region,
as far as trading in the Asia Pacific region is concerned,
currency trading volumes in the Asia Pacific session accounts for
a little more than 20% of the total.
Daily global volume, the financial,
the principal financial trading centers are Wellington in New Zealand,
Sydney in Australia, Tokyo in Japan, Hong Kong and And Singapore.
In terms of the most actively traded currency pairs,
which means what kind of news and data effect.
Basically news and data reports from New Zealand, Australia, and
Japan are going to be hitting the market during this session.
Because of the size of the Japanese market and
the importance of the Japanese data to the market, much of the action
during the Asia Pacific session is focused on the Japanese Yen currency pairs,
such as USDJPY, which is essentially Forex speak for
US dollar, Japanese Yen, and the end crosses like Euro Yen and Ozzy Yen.
Of course, Japanese financial institutions are also most active during this session,
so you can quickly get a sense of what the Japanese market is doing
based on price movements.
For individual traders overall liquidity in the major currency pairs is more than
sufficient with generally ordinary price movements during this time.
In some less liquid non-regional currencies like GBP USD or
USD Canadian dollar a price performance may be more erratic or
nonexistent depending on the enrollment that is prevailing.
As for as trading in the European and
London session is concerned about midway through the Asian trading day,
European financial centers begin to open up and the market gets into full swing.
European financial centers and London account for
over half of total daily global trading volume,
with London alone accounting for about one third of total daily global volume.
The European session overlaps with half of the Asian trading day and
half of the North American trading session, which means that market
interest and liquidity is at its absolute peak during this session.
News and data events from the eurozones, such as countries like Germany and
France, which are part of the eurozone, and even countries like Switzerland and
UK are typically released in the early morning hours of the European session.
As a result, some of the biggest moves and most active training takes place
in the European currencies like Euro, Sterling, and Swiss Francs, and
the Euro cross currency like the Euro Swissie and Euro Cable, Euro GBP.
Asian trading centers begin to wind down in the morning hours of the European
session and North American financial centers come in a few
hours later around 7:00 AM, ET, Eastern Time.
Our trading in the North American session, as far as that is concerned,
because of the overlap between North American and
European trading sessions, the trading volumes are much more significant.
Some of the biggest and most meaningful
directional price movements takes place during this crossover period.
On its own, however, the North American trading sessions accounts for
roughly the same share of global trading as that of Asia Pacific Market,
which is a little more than 20% of global daily, in volume.
The North American morning is when key economic data is released and
the Forex Market makes many offers most significant positions
on the value of the U.S. dollar during this time.
Most U.S. data reports are released at 8:30 AM, Eastern time,
with others coming out later, between 9:00 AM and 10 AM, Eastern time.
Canadian data reports are also released in the morning,
usually between 7:00 AM and 9:00AM, ET.
They're also a few U.S. economic reports that variously come out at noon or
2:00 PM, Eastern time, livening up the New York afternoon market.
London and the European financial centers begin to wind down their
trading operations around Eastern time, each around noon, Eastern time each day.
The London or European close, as it's known,
can generate volatile flurries of activities.
On most days market liquidity and interest falls off significantly
in the New York afternoon, which can make for challenging turning conditions.
On quiet days, the generally lower market interest typically leads to
stagnating price action.
On more active days where prices may have moved more significantly,
the lower liquidity can spark additional outsized price performance,
as fewer trailers scramble to get similarly fuel prices and liquidity.
Just as with the London close,
there is never a set way in which New York afternoon market move plays out.
So traders are generally careful and are aware that low liquidity
conditions tend to prevail and adapt accordingly.
So that's how the markets spans out in Asia Pacific,
in Europe, and in US time zone in the Forex Markets.
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