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Liquidity (or market depth) of Forex

  #3 (permalink)

Kalispell montana
Posts: 158 since Jan 2015
Thanks: 157 given, 23 received

Dorky View Post
Dear All,

Many people say the forex market is the largest market (even larger than the futures market) trading many trillions a day.

Some others say that is a false claim because the forex market is fragmented with no central exchange and unregulated, and mostly involves instruments like forwards and swaps that are simply beyond the retailers' access, that only banks and corporations have access to.
And if we consider the market that the retailers have access to, it is just a fraction of the multi trillion dollar a day market pie.

I am interested to know is the forex market really the largest market, and if so, what is the average market depth of the major pairs, like EUR/USD and USD/JPY?

In other words, how much does it take to move the major currency pairs by 1 tick, or say, an equivalent of 0.0125% (1 tick of the ES market assuming it is at 2000, from 0.25/2000), or in forex term, 1.25 pips?

In other words, where is the quantifiable evidence that all traders can execute upon to prove the forex is really the world's largest market, and not a false claim?

Good question. Sounds like this is connected to the volume.

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