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.