Since you only need to cover your losses and the market fluctuations are small relative to each other, most brokers allow you to trade upto 200 times the amount of money you actually deposit with them.  So with a deposit of $50 you can trade upto $10,000 and with a deposit of $50,000 can trade $10,000,000.

For example.

Say you deposit 50,000 EUR with a broker.  You decide to trade EUR USD so you buy 50,000 EUR worth of dollars at a rate of 1.40 (i.e. 1.40 US Dollars for every Euro).  You now have 70,000 USD.  The next day the rate makes a large change you trade back to EUR at 1.36 and now you have 51,470 EUR.  You made 1,470  EUR profit.

From the brokers point of view, the higher amounts you trade the more profit they make whether you profit or lose.  Since they only need you to cover your losses, if the trade had gone the other way you would have only lost 1.470 EUR out of 50,000 even though a movement from 1.40 to 1.36 is a large movement in the forex world.

If you had traded 1,000,000 EUR on the same deal as above buying at 1.40 and selling at 1.36.  you would have made 29,411 EUR profit.  However if the trade had gone the other way and you lost 29,411 EUR you would still be within the 50,000 EUR deposit and been able to cover your loss.

Leveraging is the reason the forex market can be so profitable but over leveraging can lead to much higher losses.  Almost all the warnings and risks of trading in the forex market comes down to leveraging too much.  Typically you shouldnt be leveraging more that 3-4 times your capital on any trade.  You can start trading for real without leverage and still make profit.  In fact trading without leverage is a really good way to get started once you have traded with your demo account for a few weeks.