In the Forex market now for example let’s say prices move from one third to 8 0 0 to 138 50. That is a 50 pit move. So if the market moves from 138 0 0 to 130 a 50 that is a 50 pick move. So a pip is a very small measure of change in a currency pair. Now let’s take a closer look at Pip’s. So here is a four X chart. And at this level we have the one on zero. This is the one on zero zero level. Now if the market should move 10 Pipp upwards then we will move from 1 1 0 0 to 1 won 10. So this is a 10 point move 1 1 0 0 to 1 1 10.
This is a 10 Pipp move. Now most brokers we have an extra decimal place. So 10 Pip’s will actually read a hundred pips. So this is actually 10 pips. Now here you can see tree numbers you can see won one engine entry and you can see won 11 and you can see one engine eleven point ten. One hundred and eleven point ten is the price. So the number to the right represents the price the number in the middle represents the pips on the number to the left.
The one represents the amount of candles. So from 1 11 0 0 if we want to go 10 pips up we will go to 1 11 10. And here we have won 11 10. One 11 10. This is 10 pips. If we wish to go say 20 pips we will go to won 11 20. That is 20 pips. And here you see 200 but its actually 20 pips. Most brokers are an extra decimal place. So instead of 20 you see 200 but it’s actually 20 pips would for X. And this is why 4 x is so lucrative for X let’s say you’re Riskin or let’s say you’re trading in one dollar per pick. If the market moves from here to here you just made $20.
Now let’s say you’re trade in $10 per Pipp if the market moves from here which is the 1 11 0 0 level to here you just made two on shred dollars. That’s if you’re trading $10 per Pippy you just made $200 because the market moved 20 pips. Now let’s say a trade in $100 per pet. If the market moved 20 pips That’s $2000 you just made in a matter of minutes. That is why Forex trading is so powerful. $2000 in a matter of minutes. You can make when trading Forex. It’s absolutely amazing. Now let’s look at Forex trade sizes.
Now we have treat different types of plots. We have the microdots the meaning lot and the standard lot now with the micro lot each Pipp represents point one dollar. So point one dollar per Pip with the microlight with a mini lot each Pip represents one dollar. And a standard lot each Pip represents $10 dollars. Now if you’re trading a large account let’s say your trade in $50000 or more you may open a standard account which is a minimum of one standard lots. So that’s the lowest trade law you can use one standard lot which means the lowest amount you can risk is $10 per pick.
Now with smaller accounts you can have a mini lots which means the small less amount you can risk is one dollar per pip. And with some accounts you can have a micro lot which means the smallest amount you can risk is point one dollar per penny. So would a microlight you can maybe start trading with ontrack dollars $200 you can start trading with a small amount if you’re trading a Microsoft account because you can trade Riskin as low as point one dollar per pick.
That is a micro lot with a million lot the smallest amount you can risk is $1 per pip. And with the standard lot the small amount you can risk is $10 per pick. Now this is the difference between Forex and stock trading. Let’s say you invested a thousand dollars in the stock market and you bought 10 years. So that would make it a hundred dollar per share. So let’s say you bought 10 shares. Now let’s say the market moves at one point.
Your profit on that trade would be $10 $10 profit. Now let’s say you invested that thousand dollars in the Forex market and let’s say the market moves one point which is the same as a hundred pips. So let’s say the market move one ONJ and Pip’s. If you invested that $2000 in the fork’s market you would have made $1000 profit. That is if you’re trading at $10 per Pipp that is the difference between the Forex market and the stock market or the stock market.
You could have only made $10 on that trade with the Forex market you could have made a thousand dollars on that trade. So that’s the difference with the fork’s mark what the stock market you would need to buy Towson’s shares if you wish to make a thousand dollars on that one point move. So the Forex market allows you to invest way less and still have huge returns. Now with Forex when you enter a trade by buying you have to exit by selling. And when you enter a trade by selling you out the exit by buying. Simple as that. If you’re going to buy whenever you’re going to close out that trade whenever you’re looking to take profits you must sell. But the thing is you don’t have to worry about actually selling just clothes just clothes on empty for platform and you will be automatically taken out of that trade.
Now when the market is moving up we say it is rally in your trade position is long or bullish. So that is the term we say rally when the market is moving up and your trade is bullish or long when the market is falling. Your trade is bearish and we say you have a sharp trade. So when the market is going up you have a long trade. When the market is going down you have a sharp trade. Now 95 percent of traders lose and you may be wondering why is it that 95 percent of traders lose. And the answer is simple.
Most traders don’t choose to get educated before they trade. They are eager to trade so they jump in the market and the trade off sentiments they trade off their feelings. I think the U.S. is going to rally and they buy the euro. They trade with little or no knowledge of the Forex market some just watch a YouTube video and then they go and trade Forex market. Now if you are serious about trading Forex you should seek to get educated.
That is the key to trading for successfully because you can just jump in the market and trade and lose money or you can use that money to get educated and after get an educated then you can trade and actually make money. So there’s two ways it you can just trade and lose or you can educate yourself on when key is to get educated first then start trade in the Forex market.
Now the market can only move in cheery directions it can only go up down or sideways. only true directions up down or sideways so it is not extremely difficult to make money trading forex just by guessing. You have a third a 3 percent chance of being correct. just by guessing. You’re a 30 percent chance of making money trading ports. The key now is to gain another 32 percent. So you have a 66 percent chance of being correct. And you can gain that other 2 percent by becoming educated and my course is. You will learn how to make money in all forex markets whether it’s a sideway market whether it’s a trend in market you will learn how to make money.