FOREX TERMINOLOGY- 4

 EPISODE -1

If you not even read out the previous episode i just adding the url click and read it in continuous manner. Otherwise you won’t get to know what it’s happening in forex and global market.

https://vktradersblog.blogspot.com/2020/08/origin-concept-of-forex.html - Origin and concept of forex (1),

https://vktradersblog.blogspot.com/2020/09/origin-and-concept-of-forex-2.html - Origin and concept of forex (2).

https://vktradersblog.blogspot.com/2020/09/forex-is-fun.html - Forex is fun (3).

EPISODE -4

     All things you need to know before starting the forex or basic. If you skipped or feed badly enough to learn and try out in the basic of forex trading. The more you learn the more you earn in forex trading and strategy.

The three things to be learn in forex.

1. currency pair
2. Type of order
3. Leverage, Spread, pips and margin (L,S,P,M).

1. CURRENCY PAIR:

  The first thing you need to know in the currency pair is like the pair which you are taking need to be sure.

 If you have taken the major currency the interest rate will be high but the target price and the profit hit the balance too quickly.

The winning rate/risk-reward ratio of a dedicated forex strategy makes solidly to 5%-15% a month.

MAJOR CURRENCY:

 U.S.Dollar, Japanese Yen, British Pound, Swiss Franc. Every currency pair has a nickname to be called as most of a person has a thought like whether we need to memorise their name or not!

Totally 28 currency is there, Just Make a fair name of the pair you going to trade.

Major currency pair:

• EUR/USD - Fiber (World most traded currency pair)
• USD/JPY - Ninja ( Second most traded currency pair)
• GBP/USD - Cable (Underseas cable)
• USD/ CHF - Swissy (Named because of swiss France and the economy seen to have lower risk)

MINOR CURRENCY PAIR:

• AUD/USD - Aussie (Tends to be the china does well because the countries are big trading partners)
• USD/CAD - Lonnie(Heavily affected by oil)
• NZD/USD -Kiwi (Heavily affected by data that is Agriculture, Tourism)

ARE YOU NEW TO FOREX:

• Always try to make in liquid currency pair like EUR/USD, USD/JPY.
• Before ordering a value check the technical and fundamentals of the currency pair.
• Choose the appropriate leverage.
• Don't over trade at a time and always goes with the least position.
• Choose the best time frame for trading.

FOREX QUOTE:

The price of EUR/USD or any other currency pair is supposed to move in any direction. Whether that would be in upwards, downwards it totally depends by the time interval.

For Example,

EUR/USD

Base Currency be as - Euro

If we sell it in order to buy the quote currency(USD)

We sell 1 EUR in exchange for USD 1.14034(Bid order)

Same thing vice versa remains of buy order then this is (Ask order)

If there is a difference between the base currency and quote is 0.6 pips means then this is called Spread.

LOTs:

  Simplified of Lot is deposit units. A lot can be measures the size of a transaction.

TYPE OF LOTS:

•  Micro lots size. ( Each pip is worth of $0.1)
• Mini lots of size. (Each pip is worth of $1)
• Standard lot size (Each pip is worth $10)

LONG POSITION:

   Buying or ordering a currency pair to be assumed that the price will go higher.

SHORT POSITION:

   Go short or carry is to be done that is the assumed to attain the desired value within the short period of the time interval.

(ii) ORDERS & THEIR TYPES:

            Whenever we are trading and ordering a position the first main thing is to set an SL (Stop Loss) and TP (Total profit) to maintain the risk management of the order.

• Market order/ Market execution -> Buy/ Sell the product in market price.
• Buy limit/sell limit.
• Buy stop/Sell stop.
• Buy stop limit/Sell stop limit.

LEVERAGE, SPREAD, PIPS AND MARGIN:

• Leverage -> Open trading (position) to control the risk level of trade.

• Spread -> The difference between Buy/Sell price (Bid price/Ask price).
• Pips -> The smallest price movement of currency pair 

           1 pip is 0.000X

• Margin -> The percentage of the trading amount.

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3 INDIVIDUALS WHO STAND TOWARDS YOUR SUCCESS.

  1. Voters Against 

 

"Don't do it, you're crazy!", "Absolutely not!" It could be parents, relatives, used to socialist regime.  Or they could be people who are absolutely inert, living in a world where nothing is done, where all ideas are stupid.  They will always pull you down, giving you such arguments that the idea can collapse, you will suffer great losses, etc.  You shouldn't listen to them, they haven't done anything to fulfill any of their wishes, so there's nothing to advise them.  They see decay in any endeavor.  So think about whether it is worth listening to such individuals! 

 

2. Hidden Envy

 

"Oh, that's interesting...", "Good luck with that."  "Man, I wish I could help, but..."  These could be your friends, your colleagues.  They can tell you it's all great, but at the same time trying to create some kind of obstacle in your way.  They're usually jealous, insecure people because they can't achieve anything by themselves.  This is their tactic of behavior, subconsciously they just envy you, and do not want you to become "above them".  But you do not have to ignore them completely, you have to try to make their influence weaken. 

3. YOU 

 

"I'm afraid", "I don't trust my instinct", "What if I can't?"  That voice in your head, it's dangerous!  He never forgets anything, remembers all the ways to retreat.  All these hardships and uncertainties must be buried under your dreams, not the other way around.  You need to know that and awareness will save you.  Because your instincts are good, and as a dreamer, you have already taken some of the hardest steps.  It's for us to "make peace" with our fear of keeping it at arm's length.  Trust yourself, and all these internal barriers will go away.

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FOREX IS FUN

 EPISODE -1

If you not even read out the previous episode i just adding the url click and read it in continuous manner. Otherwise you won’t get to know what it’s happening in forex and global market.

https://vktradersblog.blogspot.com/2020/08/origin-concept-of-forex.html - Origin and concept of forex (1),

https://vktradersblog.blogspot.com/2020/09/origin-and-concept-of-forex-2.html - Origin and concept of forex (2).

EPISODE -3

WHAT TO DO AT THE TIME OF STARTING THE TRADING:

  Before that need to understand the difference between stock trading and forex trading?

Stocks:

   It is like buying/selling company stocks. (i.e.,)

for example,

    If I am running a company since 2015. And you are a person of a stock trader. If you bought some shares from the company and selling it when shares profit got higher.

FOREX:

 These term of trading is used like an analysing & predicting.

for example,

 The current rate of the gold price is ₹40,000 (INR). and 0.3 ounces. If you opened an order as buy(Bid) and predicting it the price will go as uptrends within a stimulated time.

  And sold out when the price hits the value of what you determined.

 Forex has three major strategies,

•        Scalping trade,
•        Swing trade,
•        Position trade.

SCALPING TRADE:

  It is applicable to make a profit by buying/selling at a short period with a small profit.

  A time frame used for scalping is -- 1 minute (1M) to 30 Minutes(30M).

 When you dealing with the scalping method the possibilities of P&L (Profit and loss) has an equal percentage (50-50%) chances.

HOW PIPS IS CALCULATED IN SCALPING:

 A scalper will try to make 5 to 10 pips of each trade. But when the pair us got volatile the risk will be higher compared to other strategies.

 In forex or stock trading the "Spread" is defined to the buy (bid) and sell (ask) value price of currency pair.

For example,

               If you Bid a value @1.1700 ;

               Ask value @ 1.1710

    then the spread value would be 1 pip.

Forex traders make a profit based on the movement of currency pair. Trades become profitable only at the time of the value crossed the spread value where we opened an order.

Scalping will be done at the time interval between 1 minute and 15 minutes respectively.

scalping will be held only in the short interval or short term period. In which we would place much order within a short period.

 But most of the time if you like to trade with scalping technique I suggest you use the low spread currency pair instead of using high spread pairs.

Then if you thought out what about the high spread value!

I would tell it you can deal with both the spreads but if you have taken high spread pair instead of low spread value. Then your profit might be very less.

yeah!

Rather than using the high spread value, you won't make enough profit within the short term of scalping.

LOW SPREAD SCALPING TECHNIQUE:

 and forex currency pair 25 long or short within a minute.

 If you making the order above the 30 minutes time frame then that might be move on too other technique.

Pros:

•  If you need high-level profit then you must deal with positional trades.
• Should not wait to make a strong divergence movement of the market.
• don't make any pressurised think to analyse every market strategy.

CON's:

• don't make it or open too many trades at a time.
• Too many good trades lead to overconfidence.
•  There is a risk of over-trading.

SWING TECHNIQUES:

  Occurs in between the day trading and long term trading. It will handle for a few days to a few weeks.

Time frame will be, as a multi-week scheduled. They generally deal with fours (H4) and daily (D1) charts.

Before checking it you need to check the fundamentals and technical analysis of the market.

SCALPING:

•    Maintain the time
•    The action needs to be taken.
•    Must check the economic news every time before getting into trading.

SWING TRADE:

•   Only preferred time to be maintained.
•   No need to take any action against the currency pair.
•   Check the economic news every time but it won't need to apply in the trading strategy.

POSITION TRADE:

•   Time
•   Action
•   News

APART FROM THIS MAKE A RELAXATION OF YOURSELF.

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ORIGIN AND CONCEPT OF FOREX -2

EPISODE -1

If you not even read out the first episode i just adding the url click and read it in continuous manner. Otherwise you won’t get to know what it’s happening in forex and global market.

https://vktradersblog.blogspot.com/2020/08/origin-concept-of-forex.html - Origin and concept of forex (1)

EPISODE- 2

Eagerly waiting for the next episode to move on. I think so many people have come acrossed the word trader or trading but still so many people doesn’t know what’s the different between the forex trading and a normal trading.

Some people were thinking that this is like an goods import/export one.

Until you starts to know about the topic you can’t step into anything.

Well, shall we move on to the topic.

Major currency:

• USD
• EUR
• JPY
• SWITZERLAND
• CANADA
• AUSTRALIA
• NEW ZEALAND

And in the world, there are 100 different currency are found but when we dealing with forex we are supposed to pair with eight currency.

HOW ARE CURRENCY PAIR DIFFERENTIATED:

• Major currency pair,
• Minor currency pair,
• Exotic currency pair.

MAJOR CURRENCY:

• EUR/USD -  Euro/US dollar
• USD/JPY  -   US dollar/Japanese yen
• GBP/USD -  British pound/US dollar
• USD/CHF -  US dollar/Swiss franc
• USD/CAD -  US dollar/Canadian dollar
• AUD/USD -  Australian dollar/US dollar
• NZD/USD -   New Zealand dollar/US dollar.

MINOR CURRENCY PAIR:

• EUR/GBP — Euro/British pound
• EUR/AUD — Euro/Australian dollar
• GBP/JPY — British pound/Japanese yen
• CHF/JPY — Swiss franc/Japanese yen
• NZD/JPY — New Zealand dollar/Japanese yen
• GBP/CAD — British pound/Canadian dollar

EXOTIC CURRENCY PAIR:

• EUR/TRY - Euro/Turkish lira
• USD/HKD -  US dollar/Hong Kong dollar
• JPY/NOK  -  Japanese yen/Norwegian krone
• NZD/SGD  - New Zealand dollar/Singapore dollar
• GBP/ZAR  - British pound/South African rand
• AUD/MXN - Australian dollar/Mexican peso.

But we will often find out only the major and minor currency in the trading platform because those two currency pair will have the highest spread value to trade them compare with exotic pairs.

BEST PAIR TO TRADE?

    If you are new to forex platform then always first deal with Major currency pair. If you got some familiar from major currency pair then you can deal with the minor pair.

These pair always have some highest spread to trade.

If your mind asked what about the exotic pair

yeah! You can trade with this pair too.

But these kinds of exotic pair has some difficulties to trade like the exotic pair has less liquidity level and less spread value.

until you get familiar with the major and minor currency you can deal with the exotic but in my case, if you were a beginner and intermediate better to move on with Major and minor pair.

ADVANTAGE OF MAJOR CURRENCY:

Huge liquidity,

These are the currency will always high demand in the forex market.

Earning interest will be higher.

Creditworthy and the financial will be high.

INTEREST RATE OF CURRENCY:

   Whenever you are trading with the order if the pair you analysed is a bullish trend(upwards).

you are supposed to buy a currency pair and sell it when the analysing price reached.

For example,

When you are dealing with EUR/USD, The thing if your analysis is bullish trends you are purchasing the order so you will be buying it EUR and when the price is hit maximum you are selling it USD.

EUR/USD

EUR--> Buying 

USD -->Selling 

These things will happen vice versa for bearish (downtrends).

whatever the currency you are dealing has the interest trade taken out by the central banks.

So, When you bought (EUR) and Sold it (USD) There will be specific interest rate is obtained. When you dealing with this order you need to pay a certain interest rate for every order.

And we have the privilege of earning the interest in what we bought the order.

for example,

(EUR/USD) When the Euro has 5% of interest value and United States dollar(USD) has 0.5% of the interest rate.

A base point in simply as 1/100th of 1%. So, 

EUR has 500 bases and USD has 50 bases. If you deal with EUR/USD you will earn 5% from EUR and Pay 0.5% of bases.

  So, Your net return will be 450 bases.

HOW IT'S WORK?

  Currency trading or forex exchange is a 24 hours market running only in weekdays. The main currency will be mostly trade-in market hours.

  Normally in India the forex exchange market has grown in between 2004 - 2007 is 384% to an average of 34Billion/ day.

According to the global world 5.1 Trillion US dollar per day. https://en.wikipedia.org/wiki/Foreign_exchange_market

Awesome to hear this right!!

When we are getting into the main topic:

FOREX:

   Currency trading has various size lots.

•    Macro lots,
•    Micro lots,
•    Mini lots.

Lots are defined in many ways 10,100,1000,10000,100000.

EXCHANGE RATE

    The exchange rate is set for every currency when we dealing with buy/sell order. Every currency has some unique interest rate which will differ every time.

   Before calculating the value of one pair we need to know the interest rate of that specific pair. Try to google it and find out the interest rate of every pair once a week or month.

Interest rate are mainly classified by two ways one is 

•   Floating rate 
•   Fixed-rate

FLOATING RATE:

 Determined by the market price when the supply and demand are getting high.

 The price will be more.

FIXED RATES:

  Determined by the central banks. The rate will be set only with the major currency like united states dollar, Euro, Yen.

 When our interest rates stay low are failed then our adjustable floating rates gives the potential to your order and save you a lot of money in which pair of currency you had ordered it.

 According to my suggestion floating rates will be always best to compare with fixed rates. Every bank and related currency pairs have their specific interest rates. whenever we are assuming or calculating we need to check the interest rates.

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INTERESTING FACTS ABOUT DOLLAR AND EURO:

Interesting  facts about the Dollar & Euro:-

1. The highest dollar denomination that has ever been in circulation is $10,000.

2. Malformed or torn banknotes can be exchanged. Nevertheless, you should have more than half of a note.

3. The first American coins were minted in 1792.

4. In 1862, the first USA paper money was printed. It was a solution for an issue, related to the shortage of coins.

5. Martha Washington is the only woman ever depicted on the US bill.

6. The George Washington portrait was first depicted on the $1 banknote in 1869.

7. Have you ever heard the expression “dirty money”?  Paper money is literally dirty, since 94% of bills are contaminated with bacteria, while 7% of banknotes have dangerous pathogens on them.

8. $1 bills represent 45% of entire currency production.

9. The “In God We Trust” phrase first appeared on coins during the Civil War. Since 1955, it has been added to all coins.

10. The buffalo, depicted on a five-cent coin (“bison nickel”), once wandered in the Bronx Zoo.

11. If you need to trace a banknote by its serial number, then you should know that there is a site called “Where’s George?”, and it’s exactly what it does.

12. A stack of dollar notes one mile high equals $14.5M.

13. Silly Head was a name for US cents minted in 1839, because citizens believed the picture of Miss Liberty looked silly.

14. The “All-Seeing Eye” picture was included as a reflection of Divine Providence, while the Latin sentence below the pyramid on the $1 bill (NOVUS ORDO SECLORUM) means “A new order of the ages”.

15. About 90% of banknotes test positive for cocaine residue.

16. A $1 bill has 13 arrows, 13 leaves, 13 stars, and 13 stripes, and it was a symbol of the original 13 colonies.

17. “White cents” were made from 88 parts copper to 12 parts nickel. That’s why they look light (even white, to be accurate).

18. All American dollars are made from cotton (75%) and linen (25%).

19. The USA prints 37M notes daily, and it equals $696M.

20. If you decide to lay out a mile of pennies, then you should know that it equals $844,80. Thus, the USA is about $2.5M wide, from the west to east coast.

21. The approximate lifespan of a $10 banknote is about 3.6 years, a $5 bill “lives” 3.8 years, a $1 note lasts 4.8 years, and $100 bill can be in circulation for 18 years. However, the longevity of a coin is no less than 30 years.

22. Five-cent coins, minted from 1942 to 1945 can’t be called “nickel”, and for a good reason. They merely had no nickel in the alloy.

23. The fun thing is that counterfeit dollars are often detected due to the fact that they are usually more perfect than genuine bills.

24. $1M of $1 notes weigh almost as much as ’66 Volkswagen Beetle, while $1M of $20 banknotes weight almost as much as a car tire.

25. You will never find any dollar banknotes with an African American depicted on them, ever.

26. The largest dollar denomination ever printed was a banknote (gold certificate, to be accurate) of $100,000. It was intended for transactions between Federal Reserve banks, and it has never been in circulation.

27. The first person, depicted on a $1 bill was Salmon P. Chase, and it was in 1863 when he was still alive. Moreover, he was the incumbent secretary of the treasury. Thus, there is no surprise how he appeared to be on the bill, he just put himself on it. Six years later, in 1869 (as we mentioned above), George Washington settled his hubris down.

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ORIGIN & CONCEPT OF FOREX

 EPISODE 1

FOREX TRADING CONCEPT:-

ORIGIN & CONCEPT OF FOREX:

The history of the forex market began during the middle age. Where currency was traded through the overseas country.

   In fact when you deal with the exchange of the currency from a native country to another country. Forex market is the giant finance exchange in its world.

  When we look at both of the things we had done every time is quite high.

  But compared to learning the basics concept of forex and the tactics happening in the global market.

Looks good to know more, Right!

FOREX TRADING:

   

  People whoever dealing with forex will say that the forex is like gambling or illegal or scam.

  

If it true! Then I'm sure they had done and tried a lot and got failed.

 

 The success will knock you in silence, and failure will slap you in front of everyone. Nobody is here to help you this life is in your hand.    

  

So, try to do the thing which you mostly liked it's not all about the success or failure your overcoming.

   If you got the success in the first step you can't able to learn the most.

  The more you fail the more you earn. If the failure is slapped you in public. Just take it as experience.

GETTING INTO FOREX:

  Forex trading is not like a good to import/export to an overseas country. The important facts to get into forex is what we deal with currency.

  If you got the technique & tactics of concept happening in the forex then that might take you towards your success.

 WHAT WE TRADE?

    Sitting in front of the computer checking it with some global market website or thinking with the guessing of the price is not going to take you towards success. All you need to learn and do more practise before getting into the main account. And thinking out by guessing Whether the price will strike the value of what we are assuming in it.

  

If you follow these then I'm sure of it you won't be learned anything from forex.

 

Start from the beginning of the forex network. To aim high.

getting into trade !

some example,

 when you dealing with the currency pair GBP/USD is like buying out the Great British pound (GBP) and selling it American dollar (USD)

GBP/USD 

GBP <-- Buying price 

USD <-- Selling price 

HOW MANY CURRENCY ARE AVAILABLE IN FOREX?

USD/CAD        EUR/JPY

EUR/USD        EUR/CHF

USD/CHF        EUR/GBP

GBP/USD        AUD/CAD

NZD/USD        GBP/CHF

AUD/USD        GBP/JPY

USD/JPY         CHF/JPY

EUR/CAD       AUD/JPY

EUR/AUD       AUD/NZD

HOW SYMBOL OF CURRENCY CLASSIFIED:-

 FOR EXAMPLE:-

GBP

First two letter (GB) represent the country & the third letter (P) represents the name of the currency.

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