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What is leverage in forex?

You are probably wondering how a small investor like yourself can trade such large amounts of money. Think of your broker as a bank that basically fronts you $100,000 to buy currencies. All the bank asks from you is that you give it $1,000 as a good faith deposit, which it will hold for you but […]

What is a Lot in Forex?

Forex is commonly traded in specific amounts called lots, or basically the number of currency units you will buy or sell. A “lot” is a unit measuring a transaction amount. When you place orders on your trading platform, orders are placed in sizes quoted in lots. It’s like an egg carton (or egg box in British English). When you buy eggs, you usually […]

Know When to Buy or Sell a Currency Pair

Buying and selling in forex is speculating on the upward and downward price movements of a currency pair, with the hopes of making a profit. All forex trading involves buying one currency and selling another, which is why it is quoted in pairs. You would buy the pair if you expected the base currency to strengthen against the quote currency, and you would sell if you expected it to do the opposite.

Long or short position in Forex Market

“Long” and “Short” First, you should determine whether you want to buy or sell. If you want to buy (which actually means buy the base currency and sell the quote currency), you want the base currency to rise in value and then you would sell it back at a higher price. In trader talk, this is called “going […]