Who Are The Market Players In Forex? Until the late 1990's, the average Joe could not trade currencies on the foreign exchange. TheInternet changed all that, so now anyone can trade forex. Before, it was only banks and otherfinancial institutions. It is still important to understand the dynamics of market players in forex though. Super Banks Since the forex market does not have a centralized location or market, it is super banks thatdetermine the exchange rates. They base the prices and spreads on market supply and demand.These large banks are collectively known as the interbank market. They take on a gigantic amount offorex transactions every day for themselves and their customers. A few of these super banks areBarclays Capital, Citigroup, and Deutsche Bank. Large Companies and Commercial Institutions Big companies use the forex market to do business. For example, IBM needs to exchange U.S.Dollars for Japanese Yen when buying essential parts from Japan for their computer products. SinceIBM's trading volume is much less than the interbank market's trading volume, it usually deals withcommercial banks to make its transactions. Mergers and acquisitions between large companies, bothdomestically and internationally, can create currency exchange fluctuations. Just think of how manymajor corporations do business internationally, and how much money must be converted into homeor foreign currency while doing business. It's a lot. Central Banks and Governments National governments take part in the forex market too. They need to exchange currency foroperations, handling their foreign exchange reserves, international trade payments, military contracts,foreign aid, and more. Central banks affect the foreign exchange market since they adjust interestrates to control inflation in their home country. Banks, such as the Federal Reserve in the UnitedStates, The Bank of England in the United Kingdom, and the European Central Bank, are all

examples of central banks. Central banks may also start massive buy/sell operations to alterexchange rates when they think their currency is priced too high or low. These market manipulationsrarely cause any kind of sustained price action, however. Speculators This is you. And Donald Trump, and Average Joe. Speculators are in the forex market to makemoney, hoping to make it to the big time. Speculators include investment firms, the super rich likeWarren Buffet, housewives, shoe salesmen, sons of rich third-world country dictators, and so on. Allof these people are in forex to make lots of money. Some have tiny micro accounts while others havemillions to trade with, and millions to spare on losing trades. The forex market is truly a melting pot. Ifyou visit a couple forex forums and get to know some of the participants, you will see people just likeyou and people who could not be more different. Forex traders come from the United States, SaudiArabia, India, Brazil, Germany, Japan, China, and everywhere else on earth. Forex is a completelyopen market, available to anyone. Now that you understand about who market players are and how they work in forex, you can adjustyour trading strategies accordingly. It is very cool that anyone, even Mister Average Joe, can tradeforex along side the market players! Click here for more information