Basics of Forex Trading Forex - Quotes, seeds and spread

Understand what Forex pips and the spread and how it works. It is very important measure of success in forex trading

Cores and Lots

We try to understand the basic measure of success or failure of any forex trading. Pip is the smallest price movement in forex trading and spout to shorten percentage of this. If you bought EUR / USD at 1.3123 and sold at 1.3126 earned 3 points you get when you subtract from the selling price (1.3126) the purchase price (1.3123) and the dollar equivalent each beep depend the size of the trading lot, micro-parts is the minimum size of lot 1 pip equals $ 0.10 per pip, the next mini-lots and 1 pip equals $ 1.00 per pip and pip Ordinary Part 1 equal to $ 10, 00

Forex Quotes

To better understand how Forex quotes works, consider the following example, the listing price EUR / USD (Euro Dollar) 1.3120 ask price and bid price is 1.3123 the quote that you can buy EUR / USD to 1, 3123 and may sell or sell short at 1.3120. We note that the asking price and purchase price are not equal, their role is what is known as diffusion

Forex Spread

Most forex brokers do not charge the customer the expense of the Commission or brokerage commissions, then how forex brokers make money when we deal with them? The answer is by diffusion, and this is one of the retail forex broker that offers low spreads for his client. To explain further, let's say you bought EUR / USD to the purchase price of 1.3123 immediately after buying this pair has already registered a loss of 3 pips because you can only sell at 1.3120, the selling price of a , 3120 purchase price of less than 1.3123 as 3 negative or the loss of 3 pips. The spread is actually the pocket of your broker, as his income

This also works the same way when you sell short exchange, the price for selling short EUR / USD in our example above, is 1.3120, as well as the purchase order in order of sales you are already a loss equal to the diffusion of an exchange

Each time you enter into a business to buy or sell short the currency pair you are charged by your broker through the diffusion couple, is this only once each time you enter a trade and when you close a trade that is Actually when you pay your broker proliferation

During volatile periods in the broad market may shift from your usual 1-3 points for 10-50 points in a few seconds of this type of movement occurs in anticipation of a good move, or when there is favorable or unfavorable economic news will be available only for the market

Now start talking in terms of the kernel when measuring the gain or loss of forex trading or when describing a variety of currencies prices. Take advantage of brokers who offer dispersion of small or even better guaranteed fixed spreads. You should not buy or sell at the price movement as wild as it increases the risk of being accused of a significant gap