Monfex Trading Instruments
The Monfex platform is expanding its range of trading instruments! Previously you could only enter into contracts with cryptocurrencies such as Ethereum, Bitcoin, Ripple, etc., now you have access to Forex instruments, indices, commodities, and spot metals. What an update! But first things first...
Forex Instruments
Forex is an international currency market where the main convertible currencies are traded relative to each other. We have collected the best trading instruments of this market and added them to our platform. Now on Monfex, you can trade such currency pairs as EUR/USD, GBP/USD, NZD/USD, AUD/USD.
The main advantage of the tools mentioned above is that they are relatively easy to forecast and lend themselves to analysis. And lucky for you, these pairs have many forecasts and trading tips available to be taken advantage of online.
EUR/USD
The pair of euro to USD is one of the most popular Forex instruments. Comparing volatility, the euro to dollar currency pair is inferior to such sprinters as GBP/USD or USD/JPY, which can move 200-300 points a day. Usually, the range of EUR/USD moves only about 70-100 points per day.
The monetary policies of the US Federal Reserve System (FRS) and the European Central Bank (ECB) influence this currency pair the most. Besides, the following fundamental factors can be distinguished:
- Financial reports of large corporations based in the USA and Europe;
- The dynamics of commodity markets;
- Unemployment reports;
- Geopolitical factors.
The last point has perhaps the most significant influence on EUR/USD since we are talking about countries that have a direct impact on the current picture of the world. Such events can not only make quotes fly up or crash, but also change the political map of the world.
GBP/USD
The pair of the pound to the US dollar is a currency pair that ranks second most popular after EUR/USD. About 10-14% of all financial transactions in the market are performed with GBP/USD.
The pair of the pound to USD is very volatile: its intraday fluctuations can reach 200 points, and that's even if the news background is relatively calm. If something important concerning the UK or the USA is released, then the volatility can easily reach 500-600 points per day.
GBP/USD is quite aggressive. Trading within a day is marked with strong trends and pullbacks. The pair easily breaks through key resistance and support levels, but can also quickly and suddenly go back.
The British pound is affected by both domestic economic and political events, as well as news happening in the eurozone; very often, the pound's movement coincides with the euro. GBP is one of the most unpredictable and difficult currencies to forecast.
AUD/USD
This asset accounts for about 6% of all financial transactions in the market, which makes it the “major” of Forex. AUD is the main currency in this pair, while USD is the secondary or quoted one.
Main characteristics:
- High volatility (the pair is characterized by fluctuations of 100 points per day and higher);
- The most activity during the periods of two sessions: Pacific and American;
- Low activity during all other trading sessions;
- Good predictability.
This currency pair has a direct correlation (relationship) with gold. As a rule, an increase in the price of yellow metal provokes a sharp jump in the value of the asset (and vice versa). Accordingly, each trader trading the AUD/USD pair needs to monitor the dynamics of the "gold rate". There is also a correlation between NZD/USD (New Zealand and US dollars) and AUD/USD.
NZD/USD
The pair of NZD/USD (New Zealand dollar to USD) seems to be quite exotic in the market. In total, about 7% of deals are carried out with it, which makes it the so-called “major”.
Important notice! A market economy is prevailing in New Zealand. The basis of the economic system is goods produced through agriculture. The largest share of New Zealand's export earnings are occupied by dairy products (according to the US Department of Agriculture, New Zealand ranks first in the world in terms of production of dried whole milk), so traders usually pay close attention to trends in the dairy market.
The leading New Zealand partners are the USA, Australia, Japan, and China. Accordingly, an investor trading NZD/USD needs to follow the news of the microeconomics of these countries.
NZD/USD is a calm currency pair that is not profitable for scalpers. The volatility of the pair cannot be called high; daily fluctuations rarely exceed 100 points. Asset changes are easy to predict by tracking agricultural trends in New Zealand.
Indices
In addition to the Forex instruments, we added two of the most popular indexes of the stock market to the platform - the Dow Jones Index (DJIA) and S&P 500.
The Dow Jones Index is an indicator of the state of the US economy, which is calculated based on the largest 30 US companies. The list of companies is dynamic and subject to change. Editors of The Wall Street Journal create and update this list.
Although the index is no longer an accurate indicator of the state of the US economy, it primarily reflects the economic processes in the country. The index dynamics, in turn, directly affect the exchange rate of the US dollar. The growth of the index as an indicator of the improving situation of the US economy. And consequently, this causes an increase in the dollar against other currencies. A fall in the index, especially in combination with a decrease in other US indices, indicates a worsening situation in the country; as a result, the US dollar usually falls.
To more accurately determine the state of the US economy, DJIA is used together with the S&P 500. S&P 500 is an American stock index that reflects the dynamics of stock prices of the 500 largest companies by market capitalization in the US market. It has been compiled and published by Standard & Poor’s since 1957. The following proportion determines the industry composition of the index: it includes 400 of the largest companies in the industrial sector, 20 leaders of the transport sector, 40 financial corporations, and 40 organizations from the public sector.
The S&P 500 index includes the leading corporations of the US economy. To ensure that this stays true, the so-called Standard and Poor’s Corporation Index Committee, which is involved in maintaining the efficient operation of the index, is closely monitoring it. The Index Committee seeks maximum transparency for investors.
Commodities
Currently, only one Brent crude oil is available on our platform. However, we plan to expand on this list. So what is remarkable about this tool?
Brent Crude Oil is a brand of oil produced in the North Sea. The name of this variety comes from its field name. It is one of the leading brands of oil traded on international oil exchanges, mainly on ICE (Intercontinental Exchange). Since 1971, the price of Brent crude oil has been the basis for the pricing of about 40% of all global oil varieties. Therefore, this brand is called the benchmark, or marker.
Today, the price of a barrel of Brent oil is essential not only in transactions between mining and refining companies, but it is an essential financial instrument on commodity and stock exchanges. Most important to note, stock prices of large mining companies, stock prices, and currencies of oil-producing countries are all tied to the cost of oil.
The price of Brent oil consists of the prices of spot and futures contracts, i.e. current and future sales prices. Pricing in modern oil markets is a complex process that is difficult to calculate. Keeping an eye on the current demand for energy in industry and transport, as well as expectations of economic growth or decline, is essential. Besides, oil contracts are becoming a place of investment for stock speculators, which makes the dynamics of oil prices dependent on the situation in financial markets.
Spot metals
Gold and silver for many centuries have been money in the literal sense of the word. However, now, to earn or speculate on the price of precious metals, it is not necessary to buy whole ingots. XAU/USD and XAG/USD are now available on our Monfex platform. With us, you do not need to spend a lot of money to purchase gold. With leverage up to 1:50, trading is much simpler and cheaper.
When working with metals, primary attention should be paid to the work of two exchanges - London and New York. Trading is possible from 00.00 Monday to 23.59 Friday (GMT). But be aware of this important nuance: twice a day, at 10.30 and 15.00 the London Stock Exchange fixes quotes. And in the indicated period (from 10.30 to 15.00) the most active trading is observed.
Global news mainly affects the metals market. The main factors that form the price of metals are:
- The general state of the world economy. Global crises can trigger price increases.
- The price of the dollar. The strongest connection is observed on XAU/USD. The faster the dollar grows, the lower the price of gold. Conversely, if the price of a dollar falls, it can be said that it will rise for gold.
- Production level. Metals are exhaustible resources, the reserves of which are not unlimited. However, the discovery of a new field, or the withdrawal of a large mining company from the market, may affect the price.
Conclusion
As you can see, we are continuously developing our platform by constantly expanding the list of our trading instruments. On the Monfex platform, we strive to bring all the markets together in one place so that you can trade what you like. Want to speculate on the price of indices and cryptocurrencies at the same time? Take the bull by the horns!
And this is far from the end... Stay tuned for more updates.
