Lesson No 7
Today we will learn how to make our first
trade. Friends please remember that
before starting trade you must have some knowledge about the market, you must
analyze or even you can use any signal providers service to asses the trends of
the market. But for now I am not
discussing any technique or skills how to made a successful trade but I am
going to just tell you how you can made your first trade irrespective of
whether you earn a profit of got a loss.
So, you can double click on any currency
pair to see an order window, there you will be shown two different prices i.e
sell price and buy price with two buttons sell and buy in red and blue
lines. On the left side of that window
you see a graph with two lines red and blue these lines are accordingly to the
sell and buy buttons. The difference
between these two lines and prices is called spread. Which means that if you are going to buy a
currency with a price of 1.05256 $ when you will sell it broker will buy it
with a price of 1.05250 which means a spread of 6 pips. This is brokers commission. In daily life you can examine that when we go
to sell dollars to the currency exchanger he will buy it on higher rate and
when you will buy it from him he will sell it on lower rate, this difference of
buy and sell is called spread and commission in forex trading.
You can insert any comments in comment
box for identification of your order in trade tab.
Here we will discuss instant execution
first, as it is easy to understand and at very early stage you must learn about
instant execution first. Now if you
asses that price will go down, you must select take profit limit below the blue
graph line for instance you can select any value below 1.0048, it may be 1.0040
or any value below 1.0048, then press sell, it means that you are going to buy
a pair at your selected price i.e 1.0040 and you will sell it at current buy
price that is 1.0051. It means that when
your buy price i.e 1.0051 will hit the price 1.0041 your trade will
automatically execute and close with a profit of 8 pips i.e difference between
your buying and selling price i.e 1.0051-1.0051 = 10 pips. In this case if your volume was 1 then you
will earn 10 dollars for profit of 8 pips, and if your volume was 0.10 the your
profit will be 0.10 dollar and if your volume was 0.01 which is the lowest
volume lot then your profit will be 0.01 dollars. If the volume of your trade will be higher
your profit will be higher and if the volume will be lesser your profit will be
lesser.
This was instant execution with a take
profit option, but after placing your order if you are watching that market is
going more down you can change your take profit limit to any other appropriate
take profit limit. In this case we have
pressed "Sell button", in next example we will make a trade with buy
botton.
If you want to press buy button then you
must set your take profit limit above red graph line i.e in this case 1.0048,
you can set any value above this value for instance we can select 1.0058 with a
volume of 1 lot size. In this case it
means that we have bought a currency pair with a price of 1.0048 and want to
sell it with a price at 1.0058, in this case when blue line will hit the limit
i.e 1.0058 your order will execute and details will be as under:
Buying
price 1.0048
Selling
Price 1.0058
Profit
in pips 10
Profit
in dollars 10 if volume was 1.
In case market moves opposite of your
expected direction you will face a loss 1 dollar for each pip value goes below
the buying value.
I hope you have understood how to start
your first trade. I have started a
youtube channel for forex trading training you can visit it and watch the
videos for better understanding of forex trading. Youtube channel link is WATCH VIDEOS please watch the videos and subscribe the
channel so that you can get notification of future videos.
