Forex Charts
FAQ's
Why
don't the prices on the charts match
the prices on the PFG trading
platform?
Because the
spot FX market is decentralized -
meaning it lacks a single exchange
where all transactions are conducted
- each FX dealer (market maker) will
quote different prices on their
markets. Therefore, any prices
displayed by a third party charting
provider, which does not employ the
market maker's data feed, will
reflect "indicative"
prices and not necessarily
"dealing" prices. It is
important to make a distinction
between indicative prices and
dealable prices. Indicative quotes
are those that offer an indication
of the prices in the market, and the
rate at which they are changing.
Market watchers, such as S&P or
ESignal, compile indicative quotes
as a proxy for the actual market
movement. These prices are derived
from a host of contributors like
banks and clearing firms, which may
or may not reflect where PFG's
market is. Although these charts are
not an accurate reflection of
PFG's market, they can justifiably be
used for technical analysis, since
the overall trends in these markets
will ultimately be the same due to
the macroeconomic factors that drive
the FX market as a whole. All quotes
shown on the PFG system are dealable prices, where
PFG as
the market maker is willing to buy
/sell the currency pair. PFG
feeds real time executable quotes
through our own proprietary dealing
platform, which update instantly on
the slightest market move.
Click here to
try out the Free Forex Charts Demo
Click here for
your Free Forex e Guide How
is indicative Data Gathered? What is
it?
Before online
trading technology, such as the
PFG Platform, brought
price transparency to the market by
providing live streaming dealable
prices, services like Reuters were
instrumental in the price discovery
process in the FX Market. Reuters
(or any market watcher) compiles
data from a host of contributors.
Clerks employed by Reuters listen to
dealers screaming prices on the
floor and then enter them into the
computer. Fund managers would watch
Reuters to get an idea of where the
market was, since there were
significant price differences
amongst providers. Accordingly,
Reuters served as an advertisement
of prices for institutional
investors. It is important to note
that prices on the Reuters dealing
screen are indicative- showing the
last buy/sell- and not necessarily
where the market maker is willing to
buy/sell the currency pair. For the
most part indicative prices are very
close to dealing prices. Euro and
Yen indicative rates tend to be more
accurate, as a larger number of
contributors feed in. CHF and GBP
tend to be less accurate outside of
European Market hours, as fewer
banks today make markets in CHF and
GBP since there is less demand for
these currencies outside European
hours. Sometimes CHF can be off by
20 points or more. It is also
important to note that because these
prices are being entered in
manually, they are privy to human
error- especially during a fast
moving market.
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