Category Archives: Margin

Currency Depreciation

Currency Depreciation Understanding Currency Depreciation Countries with weak economic fundamentals, such as chronic current account deficits and high rates of inflation, generally have depreciating currencies. Currency depreciation, if orderly and gradual, improves a nation’s export competitiveness and may improve its trade deficit over time. But an abrupt and sizable currency depreciation may scare foreign investors…

Read More

Currency Appreciation

Currency Appreciation Currency appreciation in the same context is an increase in the value of the currency. Short-term changes in the value of a currency are reflected in changes in the exchange rate. Basics of Currency Appreciation In a floating rate exchange system, the value of a currency constantly changes based on supply and demand. Therefore, the…

Read More

How forex profit is calculated

How is forex profit calculated Calculating Profit and Loss How forex profit is calculated? The actual calculation of profit and loss in a position is quite straightforward. To calculate the P&L of a position, what you need is the position size and the number of pips the price has moved. Therefore, the actual profit or…

Read More

Technical analysis

Technical analysis Technical analysis is the framework in which traders study price movement. Foreign exchange markets are particularly well suited to using technical analysis. The high levels of liquidity in terms of trading volumes and some players, and sensitivity to big long-term national-level trends means that forex markets tend to trend over time and patterns often…

Read More

Equity in Forex

Equity in Forex The account equity or simply “Equity” represents the current value of your trading account in forex. Equity is the current value of the account and fluctuates with every tick when looking at your trading platform on your screen. It is the sum of your account balance and all floating (unrealized) profits or losses associated with your…

Read More

Resistance Level

Resistance Level The resistance level can visualize using different technical indicators rather than simply drawing a line connecting highs. What is Resistance? Initially, the resistance level on a candlestick chart is the price when you can expect more sellers than buyers. It prevents the price from rising further and the resistance levels indicate a price…

Read More

Support Level

Support Level Support level occurs where a downtrend expects to pause due to a concentration of demand. It refers to the price level that an asset does not fall below for a period of time.  Buyers, entering the market whenever the asset dips to a lower price, create an asset’s support level. In technical analysis,…

Read More

Currency Pair

Currency Pair A currency pair is a quotation of two different currencies, where one is quoted against the other. The first listed currency within a currency pair is called the base, while the second currency that is the benchmark is called the quote.   Understanding Currency Pairs Trading currency pairs are often conducted in the foreign…

Read More

Lot size

Lot size The Lot Size represents the standardized number of a financial instrument as set out by the exchange. When trading stocks, the lot size refers to the number of shares you buy in one transaction. When trading Options/Futures, the Lot Size (contract size) refers to the total number of contracts contained in one derivative…

Read More

Pip

Pip What is it? Pip is an acronym for “percentage in point” or “price interest point.” A pip is the smallest price move that an exchange rate can make based on forex market convention. Most currency pairs are priced out to four decimal places and the unit change is the last (fourth) decimal point. It…

Read More