To be successful in forex trading, you need to know what the forex trading objective is. Forex trading as you know is online money trading and the key to success is to buy low and sell high like any other market. Your job as a forex trader is to try to identify the trends in the currency you are looking to buy or sell and use forex trading strategies to ensure that profits are made.
Now that you know the purpose of forex trading, the next step in learning everything about forex is to understand the codes, definitions and numbers used when trading. All funds used in forex trading are assigned a three-letter code.
An example of this is the US dollar which is USD or the euro EUR. Online coin trading is done with combinations known as crosses and these represent the 6 letters with the most expensive coin coming first. An example of this is GBPUSD which will show you how much US dollars you will pay for one British pound. These rates are expressed as five-digit numbers, for example GPBUSD = 1.6262, which means that 1 British Pound is worth 1.6262 US dollars. When the rate changes, the change will be displayed in bold, for example GPBUSD = 1.6264, which means that the rate has moved 2 points. Knowing this is the key to successful forex trading and your key to profit.
When you enter the forex trading market, you enter as a buyer or seller of a currency. If you are the seller, your price is called the ASK price and the buyer’s price is called the BID. You can only buy money from a broker whose price is the same as the BID price. These are the main things that you should see for those who are starting in forex trading and knowing what is the purpose of forex trading and knowing everything about forex before entering the market can make a big difference in your profit.