Forex help needed

fahad

Trader
Apr 10, 2013
2
0
12
Hi,

I am new to forex trading. Currently I am practicing in MT4 demo account. I have a few questions.

1. When we place an order, a new window opens. On its left side, two lines are moving - one red and other blue. I have figured out which one is for buy order and which one for sell order. But I am confused about the price movements (moving average, candlesticks) shown on the main currency pair chart. What do these movements represent? the quote currency buying pattern, the selling pattern or the simple average of buy and sell prices? Try to explain them in the context of before & after placing an order and when closing the open position.

2. No matter if I am placing a buy order or sell order, my open position shows a loss right after placing an order and it doesn't seem to turn into profit, rather the gap keeps on widening. I get confused from this as to whether the qoute currency is appreciating or depreciating against the base currency. What am I doing wrong here?

3. In demo account of MT4, after placing an order, when i try to modify it, the pips adjustment cells are active, but the main button for applying the stop loss, take profit and trailing stop is always disabled/inactive. Hence, I dont see the results of these three functions. What to do about this?

4. How do I know when is the right time to place a buy or sell order i.e. what is the simplest and best way to spot an uptrend or downtrend?

5. How do I identify a ranging/volatile market condition from reading the chart? Are there any tools available in MT4 for this?

I will appreciate help of more experienced traders here.
 

Enivid

Administrator
Staff member
Nov 30, 2008
18,530
1,355
144
Odesa
www.earnforex.com
1. Candlesticks represent the price movements of the currency pair during a period. They show the price level when period opened, its highest point, the lowest point and the closing level. Moving averages (if applied to close levels) shows the moving average of the close candlesticks' close levels over certain number of candlesticks.

2. The initial loss is from spread. As you buy at Ask, you can only sell at Bid and there is always a Bid/Ask spread, which results in that initial loss. If the loss increases, it means that you did not guess the direction of the price movement.

3. The "Modify" button becomes enabled when you enter some correct values in the SL/TP fields. Some brokers do not allow setting SL/TP too close to entry price.

4. That is a million dollar question :).

5. It is very easy to tell if the chart is ranging or trending without any tools. Just look at the chart. If it is clearly going up or down, it is trending. If it is mostly horizontal, it is ranging.
 

fahad

Trader
Apr 10, 2013
2
0
12
thanks for your help, but something more about my first question. I converted the chart into a line chart and removed the moving average indicator. Now which prices does this line represents - the ASK price variations or the BID price variations or the Average or bid-ask prices for the currency pair?
 

Easy Trader

Master Trader
Sep 17, 2011
240
5
59
MT4 you are looking at the BID price. You can change it to see the ASK price also. (cursor in middle of chart)(right click on mouse)(properties)(common)(show ask price). I would suggest to use candle or bar charts, those charts have alot more information then just a line chart and will most likely get you closer to figuring out your #4 question.:D
 

Enivid

Administrator
Staff member
Nov 30, 2008
18,530
1,355
144
Odesa
www.earnforex.com
thanks for your help, but something more about my first question. I converted the chart into a line chart and removed the moving average indicator. Now which prices does this line represents - the ASK price variations or the BID price variations or the Average or bid-ask prices for the currency pair?
The line chart is drawn on Close prices of the given periods. If you are looking at Daily chart, the line is drawn through daily Close levels.
 

Fxpipper

Master Trader
Oct 26, 2011
1,132
4
49
You may also want to check out baby pips school of pipsology, it has all the info you need and much more. And yes, second enivid's reply - close quotes for that specific point in time.
 

ituglobal

Master Trader
Apr 17, 2013
515
31
69
Don’t despise the days of your little beginning. Though your beginning may be small, your latter end shall greatly increase. Your background may be humble. What you’ve now may be very insignificant, but it’s very imperative that you concentrate on being the best trader you can be, then your latter end shall be increased greatly. Your potential in trading is limitless and can’t be determined by opinions of others.
 

Rambo35

Confirmed PaxForex Representative
Apr 22, 2013
909
24
32
Canada
Don’t despise the days of your little beginning. Though your beginning may be small, your latter end shall greatly increase. Your background may be humble. What you’ve now may be very insignificant, but it’s very imperative that you concentrate on being the best trader you can be, then your latter end shall be increased greatly. Your potential in trading is limitless and can’t be determined by opinions of others.

I am not sure how this answered the OP question, but at least you gave something of a motivational speech.
 

Fxpipper

Master Trader
Oct 26, 2011
1,132
4
49
Well, when it comes to one's potential as a trader, that is rarely determined by the opinion of others - rather your win/loss determines whether you are a great trader or not..but yes, nice motivational reply.
 

mumuy

Active Trader
May 3, 2013
193
9
27
you can try using support and resistance strategy, your previous day high will be your resistance and your previous low will be your support.
 

Rambo35

Confirmed PaxForex Representative
Apr 22, 2013
909
24
32
Canada
you can try using support and resistance strategy, your previous day high will be your resistance and your previous low will be your support.

This rarely works and will not be profitable in the long-run.
 

KenMacLennan

Newbie
Feb 22, 2023
3
1
1
63
Hi,

I am new to forex trading. Currently I am practicing in MT4 demo account. I have a few questions.

1. When we place an order, a new window opens. On its left side, two lines are moving - one red and other blue. I have figured out which one is for buy order and which one for sell order. But I am confused about the price movements (moving average, candlesticks) shown on the main currency pair chart. What do these movements represent? the quote currency buying pattern, the selling pattern or the simple average of buy and sell prices? Try to explain them in the context of before & after placing an order and when closing the open position.

2. No matter if I am placing a buy order or sell order, my open position shows a loss right after placing an order and it doesn't seem to turn into profit, rather the gap keeps on widening. I get confused from this as to whether the qoute currency is appreciating or depreciating against the base currency. What am I doing wrong here?

3. In demo account of MT4, after placing an order, when i try to modify it, the pips adjustment cells are active, but the main button for applying the stop loss, take profit and trailing stop is always disabled/inactive. Hence, I dont see the results of these three functions. What to do about this?

4. How do I know when is the right time to place a buy or sell order i.e. what is the simplest and best way to spot an uptrend or downtrend?

5. How do I identify a ranging/volatile market condition from reading the chart? Are there any tools available in MT4 for this?

I will appreciate help of more experienced traders here.
Fahad, You sincerely need to take a beginner course in understanding the charts, (plenty are available) as the questions you are asking are the fundamentals. Just to get you started, the red and blue tick chart lines are the bid price and ask price, ask is always higher than the bid
 
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