What leverage is in the dealing centre and what is the difference between purchasing and selling prices on currency pairs?
What is the difference Between purchasing and selling?
- Thread starter markste159
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hey mark.... the difference between those two prices is the spread....
you buy at the markets 'selling price' , we refer to it as their 'ask' ..... and you sell at their 'purchasing price' , we refer to it as their 'bid'.....
forex charts are known as bid charts.... so it's the bid price that determines the high, low, open and close..... this can be confusing on high spread pairs.... as example, you might see the current gbpnzd bid, at 1.8050 but when you buy it your price might be 1.8080.....
occasionally you'll see someone complain about a stoploss getting hit when the price came no where near it.... often this is due to the spread not being truly reflected in the chart...... you can keep the 'ask' line visiable on the chart for a better idea.....h
I think when we start Forex learning, we deal with this topic at the start of Demo account. You can check the correct difference with demo account where you will see both price action.
Yes in demo account we can practice with free and can learn many way to analyze the market included using price action and many way to analyze the market using indicator or something else, for certain trader indicator is great weapon as help tool to analyze the trend market
There are two major actions in trading: selling and buying/purchasing.
In simple example, If you are selling a stock or securities then there would be a buyer. Here the buyer is purchasing the securities and the seller is selling the securities. This is the major difference between selling and purchasing.
If you are purchasing a stock then you must know that you are buying it at lowest possible price so that you can sell it out when it goes up in order to earn money.
It is important to implement technical indicators to analyse the market trend and then take decision of buying and selling.
In simple example, If you are selling a stock or securities then there would be a buyer. Here the buyer is purchasing the securities and the seller is selling the securities. This is the major difference between selling and purchasing.
If you are purchasing a stock then you must know that you are buying it at lowest possible price so that you can sell it out when it goes up in order to earn money.
It is important to implement technical indicators to analyse the market trend and then take decision of buying and selling.
People here has told you what is the difference between buying and selling, but as for leverage... don't try to work with big leverages at the start. You can try 1:10, max - 1:50. If you'll use 1:500 or more, it's likely that in 99,9% occasions you'll lose the depo.
I totally agree with you. Leverage is a double edged sword in the market. Basically leverage gives you an opportunity to boost your trade returns. However, it can also bring fatal losses in case of a wrong trade. Many believe that leverage can put a trader under higher risk as the magnitude of potential losses increases on account of leverage. Traders with the high leverage like 1:500X gets a bigger shot at making the most out of the good trade call. But during the bad trade phase, this big leverage works against us and eats up a significant part of margin. I would suggest not starting trading with big leverage.
I think once it eats up a big margin part, trader becomes more accurate and careful. Everybody is too risky at the start. Maybe it's because of youthful maximalism
Purchase price is the price where an investor can buy the instrument (forex, commodities or stocks) at best available price in the market. This price is referred to as “ASK”.
Selling price is the price where an investor can sell the instrument (forex, commodities or stocks) at best available price in the market. This price is referred to as “BID”
And the difference between ASK and BID is referred to as spread.
Spread is lower for high volume instruments (that means trading activities take place a lot like EURUSD, GBPUSD or USDJPY) and spread is higher for low volume instruments ( that means trading activities take place less like exotic currency pairs)
Selling price is the price where an investor can sell the instrument (forex, commodities or stocks) at best available price in the market. This price is referred to as “BID”
And the difference between ASK and BID is referred to as spread.
Spread is lower for high volume instruments (that means trading activities take place a lot like EURUSD, GBPUSD or USDJPY) and spread is higher for low volume instruments ( that means trading activities take place less like exotic currency pairs)
yea... you can actually distinguish both with the use of demo accounts. there you will find clearly both prices and you can understand it properly.
even i got to understand these terms initially with the demo account from signalstimes...
even i got to understand these terms initially with the demo account from signalstimes...
Yes, trend trading is very good. Your indicator should tell you the trend of the currency pair you want to trade. But before you open a trade with the suggested signal, first check if it agrees with the news.
I guess, that’s the 1st question from the newbie! By the way, Forex looks simple but the reality is different. This financial market is more than a business & challenging too. This is why, here only 10% are the successful traders.
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