The foreign exchange (Forex) market is the largest financial market globally, with a daily trading volume exceeding $6 trillion. To navigate this complex market, traders must grasp its fundamental principles. *What Drives the Forex Market?* 1. Supply and Demand: Imbalances between currency buyers and sellers influence exchange rates. 2. Economic Indicators: GDP, inflation, interest rates, and employment rates impact currency values. 3. Central Bank Policies: Monetary decisions (e.g., rate hikes, quantitative easing) affect currency strength. 4. Geopolitics: Global events, trade tensions, and elections influence market sentiment. 5. Technical Analysis: Chart patterns, trends, and indicators help predict price movements. *Key Economic Indicators* 1. GDP (Gross Domestic Product) 2. CPI (Consumer Price Index) 3. Interest Rates 4. Unemployment Rates 5. Trade Balance *Central Bank Roles* 1. Monetary Policy: Setting interest rates and regulating money supply. 2. Inflation Targeting: Maintaining price stability. 3. Currency Intervention: Managing exchange rates. *Forex Market Structure* 1. Major Currencies: USD, EUR, JPY, GBP, CHF. 2. Currency Pairs: Majors (e.g., EUR/USD), Crosses (e.g., EUR/JPY), Exotics (e.g., USD/MXN). 3. Market Sessions: Sydney, Tokyo, London, New York. *Trading Strategies* 1. Day Trading 2. Swing Trading 3. Position Trading 4. Scalping *Risk Management* 1. Stop-Loss Orders 2. Position Sizing 3. Leverage Control 4. Hedging *Conclusion* Understanding Forex market fundamentals is crucial for traders. By analyzing economic indicators, central bank policies, and technical factors, traders can make informed decisions.