Forex
The Carry Trade Explained: Why USD/JPY Rises Slowly and Falls Fast
Borrow where rates are low, lend where they are high, pocket the difference. The carry trade is simple to describe, profitable for long stretches, and prone to violent unwinds.
Section
Forex & Currencies
Currency markets explained: how central bank policy, interest rate differentials and economic data drive EUR/USD, GBP/USD and the other major pairs.
9 articles
Forex
The US Dollar Index (DXY) Explained — And What It Gets Wrong
The DXY is the headline measure of dollar strength, but its weightings were set in 1973 and it is more than half a euro trade. Here is what it measures and when to use something else.
Forex
How Central Banks Intervene in Currency Markets — And When It Works
Verbal warnings, direct intervention, capital controls and coordinated action. Central banks have several tools for influencing a currency, and their track records differ sharply.
Forex
How Federal Reserve Rate Decisions Move Currency Markets
The Fed rarely surprises with the rate itself. What moves currencies is the projected path, the language, and the gap between what the market expected and what it heard.
Forex
How to Build a EUR/USD Scenario Map Around Central Bank Decisions
Forecasting a currency pair with a single number is close to useless. Building a scenario map — what happens under each policy path, and what would falsify it — is a far more honest method.
Forex
EUR/USD Explained: What Actually Drives the World's Most Traded Pair
EUR/USD is roughly a quarter of all foreign exchange turnover. Its movement comes down to the rate differential, growth divergence, energy, and the dollar's role as a safe haven.
Forex
Pips and Lot Sizes Explained: How to Calculate What a Trade Actually Risks
A pip is the unit currencies move in. A lot is how much you hold. Combining them gives the number that matters most — what one pip of movement costs you in real money.
Forex
Leverage and Margin Explained: The Arithmetic Behind Most Blown Accounts
Leverage does not make you more likely to be right. It shortens the distance between being wrong and being closed out. Here is exactly how margin, liquidation and position sizing interact.
Forex
GBP/USD Explained: Why Cable Moves More Than the Other Majors
Sterling against the dollar is more volatile than EUR/USD, and for identifiable reasons: a smaller economy, a large current account deficit, and an unusually finance-heavy composition.
