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    Foreign exchange rate is the key to understanding forex trading

    Foreign exchange rate is an important concept about the money from different counties. It denotes the ability to exchange one currency for another and is usually dynamic, that is, it changes from day to day. For those of us who trade currencies online, foreign exchange rate is a key factor in the trading practices. It is not uncommon for foreign currency traders to make a trade and wait one or two days before closing out their position. This practice, called swing trade forex uses the foreign exchange rate of two different currencies such as the u.s. dollar and the euro and trades one against the other. Those not in foreign exchange trading might trade one currency for another when travelling such as trading canadian foreign exchange for another country's money.

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