To work in the foreign exchange market Forex was productive, a trader needs to consider many factors, that have an impact on the market and its functioning. A stable exchange rate does not yet mean a stable market situation. Since Forex – international structure, then and factors, which affect his work, there are many.
The exchange rate is affected by the volume of trades on it. Everyone is experienced trader knows, that the exchange rate is based on demand and volume for it, this is how a trend is formed. The work of the foreign exchange market is organized in this way, that this practically completely excludes the possibility of learning about the trading volumes for a certain period of time. Besides, Forex does not have a specific reference to the place of trade, but works with the help of communication technology through computers, communicators and mobile phones. This means, that it is very difficult to calculate the amount of sold and purchased currency. Can, for example, process data on futures exchanges, however, for a complete picture, we need to process information on all futures companies in the world, which in itself is very expensive and long. Therefore, traders came up with a new, easier way.
But above all, need to clarify such a moment, what to open or close positions, finding out the trading volumes will not be an entirely appropriate decision. It is common knowledge, that the main market participants are large financial institutions, who are able to create excitement in the market, or to make it look like heightened interest in a particular currency. Therefore, it is better to analyze not the trading volume., and the number of concluded deals for a given period. This will be facilitated by data on market maker quotes., especially fluctuating quotes. Frequent changes in quotes indicate a keen interest on the part of traders in the currency..
Nevertheless, объемы торгов, in some share, can be determined using technical analysis. Для этого строится отдельный schedule, which in the language of professionals is called a histogram. So, the graph contains bars with different heights. They define trading periods. The height depends on the rate at which market makers' quotes are updated. One of the bars is associated with one chart shape, thereby provides information on the volume of trading in the market for a specific time period.
However, the histogram cannot say that, what operations to buy or sell were more, and which ones are less. It is important to understand, that trading volumes are ahead of prices. The situation is as follows: if the price shows growth following the trading volume, but this continues for some time even after the volume has dropped. After that, the price drops slightly.. I.e, the trader should be alarmed by the change in volumes, since this, usually, speaks of an imminent change in the prices of currencies.
