Forex from A to Z, Part 2

Posted by Sony Thursday, July 22, 2010
Forex from A to Z, Part 2
The objective of trading in the Forex market:The goal of any place in the Forex market is the sale of one currency against another in order to Binkhad expected exchange rate, which was first sold for a second currency, which was purchased and thus making a profit when you buy back after the first currency to fall.
In the currency market for each currency pair is trading at a price which is the base currency to the corresponding currency interview. Means the currency pair USD / CHF if we say that the price of 1.2340 this means that if we want to buy one dollar we pay worth 1.2340 Swiss franc enabled. In fact, any pair of currencies, there has two prices different at any time one of them called the offer price Bid and the other is called the asking price Ask There are slight difference, including mean, for example pair EUR / USD can be bid 1.6042 and the ask price 1.6045 and the price I (offer) price is the husband if you sell it now ... Price and the second is the purchase price if you buy a currency pair now. Of course, these prices change in real time and there is low or high depending on where the market movement.
The purchase price is always higher than the selling price and the difference this is a win for the bank or broker you are dealing with the market through it. This is called the difference Spread The smaller this difference the more the advantage of the middleman, who are dealing with. In most of the normal market, this difference is almost constant.
In order to win in any operation in the Forex market, you have to check the gain higher than the value of the Spread. For example if you bought a currency pair EUR / USD price mentioned above is 1.6045 await to increase the price of this pair of currencies and of course, there are two possibilities
1 - either to increase the price or less price. If the increased price of 1.6043 can be an example (view) / 1.6046 (for purchase) In this case, if you sell will be the loser because you will sell the pair at 1.6043 bid, which is less than the price you paid when buying ... If I waited more time and price is 1.6045 (view) / 1.6048 (for purchase) At this time, if you sell will sell at 1.6045 bid, which is the same price you bought it and therefore will not be won or lost ... If I waited to become a more price 1.6048 (view) / 1.6051 (the request) Vstabie at 1.6048 bid, a price which is bare of the price which you bought this pair and thus will gain. This means you can not gain in any operation in the Forex unless the difference between the price of opening operation and closing price is greater than the Spread (the difference between the price of supply and demand)
2 - the second case is that for less than the husband in this case any price was a loser because you will be prompted to buy a specific value has decreased its price and thus will pay you a lower value than sell it again. For example, if the price change to become a husband 1.6040 (view) / 1.6043 (for purchase) and you want to sell Vstabie pair at 1.6040, which is less than the price I bought it and thus be a loser.
What is a pip PIP:The movement of the currency market to be very slight ... For example, does not mean you expect that you joined the dollar today as 1 euro and demand there tomorrow at 2 ... Not even today, and tomorrow by 1.5 to 1.6 ... De forces are significant differences for the currency market ... Differences formation lot less than this, a formation normally worth 0.0001 of the currency means the unity of 10000 of the currency in most cases. Elly affection Bismy pip PIP mean if I bought a pair EUR / USD at 1.6040 and then, I sold at 1.6050 you stay, hard-achieved gain 10 Pape is the difference between the two prices. And always any gain or loss in the market Baiqas Balbib PIP and also the value of the Spread, which had been defined in this lesson Balbib also measured. Mean to say we appreciate the example that the value of the currency pair Spread EUR / USD is approximately 3 Labib PIP. It is therefore considered the cost of any operation on the pair ... I mean, if I do not check Ankdr gain higher than the value of what she Spread de 3 Labib remains de Mfhac process.
Pip PIP also is less valuable than the currency as possible to deal with them (but it is possible some of the intermediaries deal with ten bib).
The method of calculating the value of the bib:We are, of course we say that the least movement of the exchange rate or the market is too small to break the verbal currency Pencmih bib. And therefore any rise in the rate or currency Balbib offset by the decrease in the length of the gain and loss on any process I Vathaa affection according to any currency and any work I sold it I bought it.
And therefore is very important because I know what is the value of this gain or loss Elly Hhsal in return for this bib.
Indeed, the value of the bib Btakhtlv of a pair to another currency. Already we say that the price of buying and selling Elly Bacon companion to any pair of currencies Bacon Elly Hdfh price of the second currency What for the first currency bought or the price Elly Hakhaddh from the second currency for the sale of the first currency. And thus the value of the bib be calculated fracture of the second currency. Mean, for example the currency pair EUR / USD be bib when calculated currency, second, and consequently one of Labib in the pair is equal to 0.0001 of the euro currency pair USD / CHF value bib 0.0001 of the Swiss franc in the pair EUR / GBP value bib 0.0001 a pound sterling.
Negi good point Acceso a very important when buying or selling a currency pair Hstry it had any, or may sell eh?? Is Hstry of the currency pair EUR / GBP eg 4 ... De us that the market is moving so that the price increases by the husband de 20 Labib Labib, 20, I won the table from the value of the Spread what can this pair be in the range of 5 Pape ... I mean, I gained 15 Pape ... Countries learn about good cam??? Let's calculate it ... Pair de bib which equal 0.0001 a pound and this means I won the 4 * 15 * 0.0001 = 0.0060 a pound Woody of course a very small value, very, very ... What Tistahlc my hard place. Indeed, the buying and selling in larger quantities Btaatm Katie from 4 ... Mean, for example 100 thousand or a million of the coin. For example if we have the same profit the previous buyer I was 10 thousand of the same pair EUR / GBP and the market moved by 15 Pape ... What for I daresay we won the cam keeps Hndharb 10000 * 15 * 0.0001 = £ 15 and of course deserves a little de ... Ok if you are the buyer 100 thousand ... Hikon gain £ 150 ... If you are the buyer Hikon million gain £ 1500.
Of course, the very important points here:
1 - The first point you looking at Dmagkm sure all of you Now you ... What do you Hstry a million euros ... Is it necessary to be with me What for millions of dollars enter the Forex market?? The answer does not of course and this Pethal by something called margin trading ... Hnteklm them after that.
2 - point the other is like what you can earn £ 150 ... If the price moves in the direction 15 Labib carefully Ankhosr still the £ 150. And hence the more the volume of transactions increased gain or increased loss ... And therefore a risk.

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