For Question #3 Read: How to Make Money Trading Forex? If you want to sell (which actually means sell the base currency and buy the quote currency), you want the base currency to fall in value and then you would buy it back at a lower price. This is called “going short” or taking a “short position”. Just remember: short = sell.
For Question #4 Read:What is a Lot in Forex? If the allowed leverage is 100:1 (or 1% of position required), and you wanted to trade a position worth $20,000, your broker would set aside $200 as down payment, or the “margin,” and let you “borrow” the rest. Of course, any losses or gains will be deducted or added to the remaining cash balance in your account.
For Question #5 Read: How to Make Money Trading Forex? Margin trading is simply the term used for trading with borrowed capital. This is how you’re able to open $1,250 or $50,000 positions with as little as $25 or $1,000. You can conduct relatively large transactions, very quickly and cheaply, with a small amount of initial capital.
For Question #6 Read:Demo Trade Your Way to Success You can open a demo account for FREE with most forex brokers. These “pretend” accounts have the full capabilities of a “real” account. The demo account allows you to learn about the forex market and test your trading skills with ZERO risk.
For Question #7 Read:Impress Your Date with Forex Lingo The base currency is the first currency in any currency pair. The currency quote shows how much the base currency is worth as measured against the second currency.
For Question #8 Read: Types of Forex Orders A stop-entry order is an order placed to buy above the market or sell below the market at a certain price.
For Question #9 Read: Impress Your Date with Forex Lingo The ask price is also called the offer price. The ask/offer is the price at which the market is prepared to sell a specific currency pair in the forex market. At this price, you can buy the base currency.
For Question #12 Read:Demo Trade Your Way to Success Stick with one of the majors because they are the most liquid which usually means tighter spreads and less chance of slippage. Plus, in the beginning you need time to focus on improving your trading processes and creating good habits.
For Question #13 Read:Types of Forex Orders A trailing stop is a type of stop-loss order attached to a trade that moves as price fluctuates.