At it’s most basic, currency trading is the exchange of a currency for another. With online forex trading, you buy a currency, electronically, wait for the rate to change, and sell back the currency, at a profit.
The forex market is the largest market in the world with over 4 trillion dollars traded every day. Compared to other financial markets such as the stock exchange, the forex market is a giant. It dwarfs all the other markets, and for a good reason. All international transactions are settled using currencies!
Traders make profits in the forex market by buying a curreny when it’s value is low, and selling it when the value is high.
To give you a practical idea, imagine the U.S dollar is currently valued at 65 Kenya Shillings. You know that this value is the lowest the dollar will ever go, and so, you buy 500 USD, and wait to sell them when the value goes back higher. If you later sell the dollar at 100/=, you’ll have made 35/= per dollar.
Now, you do the maths.