Discover the largest financial market in the world, how it works, and why it's accessible to everyone through the internet.
In the ten seconds it takes you to read this sentence, about one billion dollars has just changed hands on the market you are about to understand.
People make a living from this market. Not by luck, and not because they found a secret: because they learned to read it methodically before risking a single franc on it. That is exactly what you are starting to do here: learn first, act second. That is the order every one of them started with.
Forex (short for Foreign Exchange Market) is the market where currencies are traded. Unlike a stock exchange such as the one in Paris or New York, Forex has no central building. A stock exchange is the market where shares are bought and sold, that is, small pieces of ownership in a company. It runs entirely online, 24 hours a day, 5 days a week.
Every day, about 9.6 trillion dollars are traded on Forex (BIS 2025 survey). Per second, that’s about 111 million dollars. It’s roughly 10 times more than all the world’s stock exchanges combined.
To give you a sense of scale: in 2025, everything a country like Gabon produced in a whole year was worth about 21 billion dollars (World Bank). Forex trades that amount in just over three minutes.
This volume has a practical consequence: at almost any moment, someone is ready to buy what you sell or sell what you buy, and your order goes through fast. It does not make prices stable, though: they move constantly, and the rest of this lesson tells you why.
A concrete example
Imagine you’re traveling to Paris. Before you leave, you exchange your local currency for euros. When you come back, you convert whatever euros are left back into your local currency. Without realizing it, you’ve just taken part in the Forex market. Professional traders do exactly the same thing, only on a much larger scale and far faster.
A currency has no value on its own. It only has one relative to another, and that value is the result of a very simple balance of power: how many people want to buy it versus how many want to sell it, right now.
When a Japanese company pays an invoice in dollars, it sells yen and buys dollars. When an American fund invests in Europe, it sells dollars and buys euros. Each of those acts pushes a price one way or the other. The price on your screen is the sum of all those acts, continuously.
The price of rice, in euros
An importer pays for bags of rice in dollars. This morning, 1 dollar is worth 0.90 euro. That’s an example rate, chosen to keep the arithmetic simple. A 20-dollar bag therefore costs 18 euros.
During the day, far more people want to buy dollars than to sell them. The dollar rises to 0.93 euro, and the same bag now costs 18.60 euros. Nobody decided that price: it’s the line of buyers against the line of sellers.
The arithmetic is the same whatever your currency: swap the euro for yours, and the mechanism does not change.
That’s why Forex doesn’t “go up” or “go down” as a whole, unlike a stock exchange. There’s nothing to push up: there are only ratios between two currencies. If the euro rises against the dollar, the dollar falls against the euro. It’s the same sentence, said both ways.
Thanks to the internet and online brokers, anyone in the world can open a trading account and access the Forex market. Wherever you are, you can trade on exactly the same markets as a trader in London. All you need: a smartphone, an internet connection, and solid training.
The role of AFX Institute
AFX Institute is here to give you that solid training, clear and accessible. Our goal: that you truly understand what you’re doing before you put a single dollar into the markets.
Forex is open almost around the clock because the world’s markets take turns. That doesn’t mean every hour is the same: depending on when you open your screen, you’re looking at a sleeping market or a market in full swing, and those aren’t the same job. Module 6 is devoted entirely to it. There are 4 major sessions: Sydney, Tokyo, London, and New York. The London session is the most active: that’s when volumes are highest. It runs from 8am to 5pm GMT in winter, and from 7am to 4pm GMT in summer.
Forex closes on Friday evening and reopens on Sunday evening. During those forty-eight hours the world keeps turning: a central bank speaks, an election is held, a conflict breaks out. Prices, meanwhile, are frozen. When the market reopens, it catches up on everything at once.
That catch-up has a name, the gap, and it’s a hole in the chart: price doesn’t pass through the intermediate values, it jumps.
What a weekend costs, in numbers
You buy the euro against the dollar on Friday at 5 pm, at 1.0850. You place a safety exit at 1.0830, telling yourself you won’t lose more than 20 points. On Sunday evening, news broke over the weekend: the market reopens straight at 1.0805.
Your exit didn’t trigger at 1.0830, because no price ever passed through there. It fills at the first available price, 1.0805. You expected to lose 20 points; you lose 45. On a 0.10 lot position, the difference is 25 dollars you hadn’t planned for.
This is neither a scam nor bad luck: it’s the normal behaviour of a market that closes. Experienced traders know it, and many simply close their positions on Friday.
Keep the rule that follows, it will serve you for a long time: the safety exit in the example is called a stop loss, and your stop loss only protects you while the market is open. Over the weekend it can do nothing: if the price jumps, you exit at the reopening price, not at yours. Do not keep a position open across a weekend while you are a beginner. Level 2 comes back to it when you place your first stops.
Key takeaway: Forex is the largest financial market in the world, and it’s accessible from anywhere with a modest amount of capital. That accessibility is rare: few activities offer this much potential for those who train seriously. A price is never anything but the balance of power between buyers and sellers, and this market closes at the weekend, which has a cost when you forget it. You’re leaving this module with a feel for the terrain. The next one introduces who the real players are and why they trade.
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