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Forex Trading
The foreign exchange market, also knows as FOREX, originated in 1973 has become the largest e-currency trade market in the world today. FOREX trading occurs 24 hours a day, 5 days a week. The FOREX market offers a unique trading opportunity to those...
How does foreign exchange affect your business?
How does foreign exchange affect your business? Taking on risk Businesses with operations overseas often take upon unnecessary risk when trading goods and services. When buying or selling shipments of electronics, for instance, the terms of...
Poor Man's Access to Foreign Currency Trading
By far, the largest trading market in the world is the foreign
currency market. Speculators make up only a small part of the
spot (cash market) and forward (futures market) currency
exchange transactions. So if you are considering speculating...
The Miracle of Forex
My father, who owns a small parts store and garage for vintage British sports cars, called me up recently and droned on and on about how he is getting killed by the Euro. Confused as to how the Euro could possibly be affecting his small and...
What Is Forex Trading?
Forex trading is nothing more than direct access trading of
different types of foreign currencies. In the past, foreign
exchange trading was mostly limited to large banks and
institutional traders. However recent technological advancements
have...
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How Many Forex Order Types There Are and How to Use Them In Your Favor.
Once you have decided to enter the Forex trading world, one of the first things you will have to do is downloading the trading station provided by your chosen forex broker for free. When you open your trading station software, you will find there are two main ways to enter a market or, said in another way, there are two ways to place an initial order to buy or sell any currency pair.
“Market order”; this is an order to buy or sell a currency pair at the market price the instant that the order is received and processed (within seconds of hitting the "OK" button on your screen). When a market order is placed, you are simply saying "I'll buy or sell the currency pair at whatever price it is at when my order gets processed."
“Entry order”; this is an order to buy or sell a currency pair when it reaches a certain price target. This can be any price in theory. You could set an entry order for the low price of a time period, or the high price of a time period. As an example, one usual recommendation is that you must always set an entry order to be the same price as the ‘open price” of the time period. When you place an “entry order” to buy, for example, you are simply saying "I want
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to buy this currency pair at a certain price, if it never reaches that price, I don't want to purchase the pair."
After your “entry order” is placed, you can set a stop and/or limit order if you desire, and for your own security. Stop and Limit orders are two different ways to exit a trade, automatically (i.e., without closing out your position via the click of your mouse - manually), after the trade is entered.
A “stop order” (something I will always recommend you) is used to stop losses. A “limit order” (recommended if you can't monitor your open trade) is used to redeem profits. Where these orders are placed, in relation to your open trade, depends on the direction of the entry order.
Remember; a “stop order” is always placed below the current market value of that currency pair when you are in a long (buy) trade. And a “limit order” is always placed above the current market value of that currency pair when you are in a long (buy) trade.
About the author:
Adrian Pablo; Forex trader and freelance writer
>> http://www.1-forex.com
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