Online Forex Trading Terminology

Forex and Contract for Differences investing is just like any endeavor, where preparation is a valuable instrument. Understanding and familiarizing yourself with terminology is valuable asset for any trader. Forex Online Currency Trading

Base currency & quote currency:

Currency is always traded in Pairs like EURUSD, GBDand EURJPY.
First currency in the Pair is know as Base currency.
Second Currency in the Pair is know as Counter currency/ Secondary currency.

Bid Price/ Buy Price:

The price at which the market buys a currency. This is the price that the trader may sell the base currency.

Ask price/ /Sell Price:

The price at which the market sells a currency. The trader can buy the base currency at this price.

Long /short:

A position that appreciates in value if market prices increase. When the base currency in the pair is bought, the position is said to be long. An investment positions that benefit from a decline in market price. When the base currency in the pair is sold, the position is said to be short.

Lot:

A lot is the standard unit size of a transaction. It represents the minimum quantity which can be traded in any given instrument.For Forex Trading, Markets.com standard lot size is 1,000 units of the quoted currency.For CFD Trading, the standard lot size varies from 1 to 500 units of the quoted CFD.

Spread:

The spread is the difference between the BID and the ASK price in the market quotes. The ASK price is applicable to a BUY order and the BID price is applicable to a SELL order. Pepper stone operates using variable spreads, which are spreads that don’t have the same constant value. A variable spread will condense and widen as market conditions and liquidity change. Open PAMM Manager Account

Leverage:

This is the use of borrowed capital to increase potential return. Trading on leveraged capital means that you can trade amounts significantly higher than the balance of your funds, which only serves as the margin. High leverage can significantly increase the potential return, but it can also significantly increase potential losses. The leverage is specified as a ratio, such as 200:1. This means that the trader can trade amounts 200 times higher than the sum in his or her margin account. If the trader has $1,000 in his account, it means that he can now open trades worth $200,000.

Margin:

The amount of equity contributed by a customer as a percentage of the current market value of the securities held in a margin account.

Swap:

Swap is the overnight interest rate paid or deducted on the open positions by the Forex broker.

Trailing Stop:

Trailing Stop-Loss Orders limits your Losses whereas allows your profits to grow. The trailing stop adjusts the order rate as the market price moves, but only in the direction of your trade. For example, if you’re long EUR/CHF at 1.5750 and you set the trailing stop at 30 pips, the stop will initially become active at 1.5720 (1.5750–30 pips).

In the same example, if the prices moves up to 1.5795 then the trailing stop will be automatically adjusted to 1.5765 (1.5795-30 pips).

Regards,

BlueMax Capital Ltd,

Mobile : +91 8870455111

E-mail : info@bluemaxcapital.com

Web : www.bluemaxcapital.com

Forex Market Trading Hours

Forex market is open 24 hours a day. It provides a great opportunity for traders to trade at any time of the day or night. However, when it seems to be not so important at the beginning, the right time to trade is one of the most crucial points in becoming a successful Forex trader. Forex Trading Broker India

Market moves from Wellington, Sydney, Tokyo, Singapore, Hong Kong, Beijing, Bombay, Dubai, Moscow, Zurich, Paris, Frankfurt, Berlin, London, Toronto, New York, and Chicago like that. So Even if the Business Timing in one country is closed, the same would be opened in other country.

Trading Sessions:

For day traders the most productive hours are between the opening of the London markets at 08:00 GMT and the closing of the US markets at 22:00 GMT. The peak time for trading is when the US and London markets overlap between 1 pm GMT – 4 pm GMT. The main sessions of the day are the London, US and Asian markets. PAMM Fund Management India 

Below is a brief overview of trading sessions that will help you make the most of the market: 

London session:

Open between 8 am GMT – 5 pm GMT; EUR, GBP, USD are the most active currencies.

US Session:

Open between 1 pm GMT – 10 pm GMT; USD, EUR, GBP, AUD, JPY are the most active currencies.

Asian session:

Opens at about 10 pm GMT on Sunday afternoon, goes into the European trading session at about 9 am GMT; not very suitable for day trading.

Best Times of Day to Trade Forex

Tokyo – London Overlap:

Liquidity during this session is pretty thin for a few reasons. Typically, there isn’t as much movement during the Asian session so, once the afternoon hits; it’s pretty much a snooze fest. With European traders just starting to get into their offices, trading can be boring as liquidity dries up. This would be an ideal time to take a chill pill, play some putt-putt or look for potential trades to take for the London and New York sessions.

London – New York Overlap:

This is when the real shebang begins! You can literally hear traders crack their knuckles during this time, because they know they have their work cut out for them. This is the busiest time of day, as traders from the two largest financial centres (London and New York) begin duking it out. Forex White Label Solution

It is during this period where we can see some big moves, especially when news reports from the U.S. and Canada are released. The markets can also be hit by “late” news coming out of Europe. If any trends were established during the European session, we could see the trend continue, as U.S. traders decide to jump in and establish their positions after reading up what happened earlier in the day. You should watch out though, at the end of this session, as some European traders may be closing their positions, which could lead to some choppy moves right before lunch time in the U.S.

Regards,

BlueMax Capital Ltd,

Mobile : +91 8870455111

E-mail : info@bluemaxcapital.com

Web : www.bluemaxcapital.com