Decentralized Market:

Forex is not traded on a specific exchange like stocks. It's a global, over-the-counter (OTC) market where transactions happen electronically, 24 hours a day, five days a week. 

Currency Pairs:

Forex trading always involves two currencies. You're essentially betting on the relative value of one currency against another. For example, in the EUR/USD pair, you're trading euros against US dollars. 

Price Fluctuations:

Exchange rates constantly change based on various factors, including economic data, political events, and market sentiment. Traders aim to predict these fluctuations to make a profit. 

How Forex Trading Works:

Buying and Selling:

When you "buy" a currency pair, you're essentially buying the first currency and selling the second. If you think the first currency will increase in value against the second, you would buy. If you think it will decrease, you would sell. 

Profit and Loss:

If your prediction is correct, you make a profit when you close the trade. If your prediction is wrong, you incur a loss. 

Leverage:

Forex trading often involves leverage, which allows you to control a larger position with a smaller amount of capital. While leverage can amplify profits, it also magnifies losses. 

Risk Management:

Due to the high volatility and leverage involved, it's crucial to use risk management techniques like stop-loss orders to limit potential losses.