what is spread in forex?
In the forex market, the bid-ask spread is the difference between the highest price a buyer is willing to pay and the lowest price a seller is willing to sell. The bid price minus the asking price is how to get the spread, while the percentage is calculated by dividing the spread by the price of the asset, and then multiplying by 100. To use the bid-ask terms, the two parties in the forex trading system are the market makers and the market takers. The market makers are the trading platforms or brokers who buy at the bid price to sell at higher ask prices. The market takers or traders buy at ask prices and sell at bid prices.
forex trading strategies
The decision of traders are mostly informed by when to buy or sell a given currency pair. The most common strategies are manual strategies which require a proper understanding of changes in the stock market, and automated system, which requires a trader to teach algorithms how to make the trade.
forex trading for dummies
There are three ways of trading assets in the forex market. Spot trading fits short term traders and the forces of demand and supply play here. Traders do not buy or sell stocks in the forward and futures market. What happens is buying of contracts which gives buyers claims to specific assets. In the forward market, buying and selling take place over the counter on terms agreed upon by both parties. In the futures market, however, buying and selling take place based on a standard size and settlement date.
best forex signals
- Technical pattern
- Moving Averages
- Trading volume
- Interest rate
The best forex trading tips
Make a conscious effort to identify the best currency pairs.
Always calculate the risk-reward ratio. If high, then adjust.
Know your trading entry point.
Have a clear exit point.
Maintain a single strategy, and tweak rather than change it.
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