From a long-term perspective, cashback forex.com">forexcashbackprofitcalculator cashback forex profit calculator cashbackforexprofitcalculators are determined by the supply and demand in the foreign exchange cashbackforexpipcalculator, but from a short-term perspective, the spot price of foreign exchange is always a departure from the long-term equilibrium price of foreign exchange since the 70s floating exchange rate system dominated the foreign exchange market, the foreign exchange market line market changes every day, its magnitude is far more than stocks, bonds The foreign exchange market fluctuations caused by short-term factors such as economic, political, but also psychological, due to short-term factors and constraints on long-term factors, so that the short-term equilibrium price of foreign exchange is consistent with the long-term equilibrium price of the foreign exchange market short-term excessive fluctuations in the international foreign exchange market foreign exchange prices fluctuate every day roughly between 0.5% and 1.0% (that is, one to two cents, using Foreign exchange market terminology is 100 points to 200 points), fluctuations can reach more than 5% (i.e., 700 points to 1000 points) foreign exchange market on the regular ups and downs in foreign exchange prices illustrate the two main characteristics of the foreign exchange market: first, the risk is great; second, the possibility of huge profits in the foreign exchange market investment exists for the foreign exchange market often appear short-term sharp fluctuations, economics Called the information overreaction (overshooting) for what is the foreign exchange market overreaction, there are now roughly the following three explanations first, the spot price of foreign exchange and foreign exchange rates deviate from the long-term equilibrium price people often read in the newspaper, a currency exchange rate is currently overvalued, or a currency exchange rate has been far below its reasonable price of these words What refers to this phenomenon is that the price of foreign exchange is based on the market to develop artificial prices, due to the existence of foreign exchange market fluctuations of this factor, the major banks in the daily foreign exchange quotation, often in the report of the spot price at the same time, there will be a forward price, at least in the foreign exchange futures market can be found in the foreign exchange futures price of foreign exchange futures price from the theoretical should be closer to the long-term equilibrium of foreign exchange Price of foreign exchange spot price excessively deviates from the long-term equilibrium price of foreign exchange can also be explained by a variety of reasons, may be the spot price is too low or too high, may also be the long-term equilibrium price is estimated too low or too high from the market operation itself, in the speculative capital is not sufficient (in the market trading very little), or in the foreign exchange market speculative capital is too much (the market trading overheated), spot Price fluctuations exceed its long-term equilibrium price is not an incomprehensible phenomenon Second, the short-term equilibrium price fluctuations of foreign exchange will always exceed its long-term equilibrium price fluctuations This explanation, assuming that all the factors that will affect the foreign exchange market will have an effect on the price fluctuations of foreign exchange, but the effect of this effect in time and channel differences, resulting in short-term equilibrium price deviation from the long-term equilibrium price for The short-term equilibrium price of foreign exchange deviates from the long-term equilibrium price phenomenon, the current economics popular explanation is that when the government expands the money supply or lower interest rates, prices in the market will not immediately rise, resulting in an increase in the real money supply, the foreign exchange market is a rapid response, the exchange rate of the national currency fell sharply, so that the short-term equilibrium price of foreign exchange is excessively lower than the long-term equilibrium price and when prices in the fully digested money supply growth factors will rise, the real The real money supply will fall, and the short-term equilibrium price of foreign exchange will gradually recover to converge with the long-term equilibrium price Third, the foreign exchange market is not an efficient market, that is, the fluctuation of foreign exchange prices does not fully reflect the market in a certain period of time all the information, resulting in the actual price of foreign exchange often deviates excessively from the equilibrium price to explore whether the foreign exchange market is First, a macroeconomic model should include all the variables that affect the model and believe that the sum of these variables will determine the outcome of the model - the same principle applies to the foreign exchange market. Second, if the foreign exchange market is not an efficient market, it will lead to some corrective actions in the market, such as the profit-motivated speculators to intervene in the market, the need to accurately release information affecting the market, government intervention, etc. These Corrective behavior will sometimes make the actual price and equilibrium price convergence, and sometimes will further distort the market price fluctuations again, the foreign exchange market is not an efficient market, will be directly related to the international financial market investment decisions, become an important factor for investors to consider whether to invest capital in the foreign exchange market from the actual fluctuations in the foreign exchange market, the foreign exchange market in the long term may be an information has Beneficial market, but in the short term is far from proving that the current foreign exchange market is the largest daily fluctuations in the impact of the news, it includes economic and political two categories in addition, the market investors willingness and psychological factors, and often make these news on the foreign exchange market to further expand the impact of the