what is forex trading and how does it work

Forex trading, also known as foreign exchange or FX trading, is the process of exchanging one currency for another. It is the largest and most liquid market in the world, with a daily global trading volume that reached $7.5 trillion in 2022. In forex trading, currencies are always traded in pairs, with the value of one currency relative to another constantly fluctuating based on supply and demand. Traders aim to buy currencies at a low price and sell them at a high price to make a profit. The forex market operates 24 hours a day, five and a half days a week, and is conducted over the counter, meaning there is no central exchange. It is a market that is open to individual investors as well as institutional firms and large banks. Forex trading can be highly volatile and is influenced by a wide range of factors, including economic indicators, geopolitical events, and market sentiment