Getting Started With Forex

THE BASICS

Get to Know the Basics of FOREX Trading from Currency Pairs, MetaTrader 4/5, Pips and the Autochartist Expert Advisor

Currency Pairs

All Forex Trading is done in currency pairs. Say, for example, you choose EURUSD as a Trading pair, the first currency (EUR) would be bought (Long) or sold (Short) against the USD. If you decide to go Long (Buy) EUR then a rise in the EUR (against the USD)  would result in you making a profit on your trade. Should the EUR drop in value (against the USD) you would make a loss. There are many currency pairs you can choose to Trade.There are “Majors”, “Commodity Currencies”, “Minors” (or crosses) and “Exotics”.

The basics – Forex Trading

Brokers

In Forex trading the spread determines the price you’ll pay for your trade. Every trade consists of a buy (Bid) price and a sell (Ask) price, with the spread being the difference between the two. In general, the lower the spread the better the price will be. Using leverage gives you full exposure to a trade even if you only have a small amount of capital to contribute. For example, applying leverage of 500:1 means you could use $1,000 to control $500,000 worth of trades. Just remember that the higher the leverage, the higher the risk.

Metatrader 4/5

MetaTrader 5 (MT5) facilitates online trading in forex, stocks, and futures. Rich analysis tools and indicators make it an excellent platform for experienced traders. Automated trading is also available through expert advisors and signals.

Forex | Stocks |Futures| Equities

when you invest in a company, you’re buying a piece of it, or a “share.”

With futures, you are not investing in a company. Instead, you’re buying a contract to have exposure to physical assets, ranging from corn or soybeans to coffee or oil.

Equities represent the amount of money that would be returned to a company’s shareholders if all of the assets were liquidated and all of the company’s debt was paid off.

Pips

A pip, an acronym for “price interest point”, is a tool of measurement related to the smallest price movement made by any exchange rate. Currencies are usually quoted to four decimal places, meaning that the smallest change in a currency pair would be in the last digit. This would make one pip equal to 1/100th of a percent, or one basis point. For example, if the currency price we quoted earlier changed from 1.1200 to 1.1205, this would be a change of five pips.

The basics – Forex Trading

Expert Advisor

In the world of foreign exchange (forex) trading, an expert advisor (EA) is a piece of software that tells you when to make trades or even automatically initiates and executes trades according to preprogrammed instructions. Expert advisors are most often deployed on the MetaTrader 4 or 5 forex trading platforms.