A long position means a trader has bought a currency expecting its value to rise. Once the trader sells that currency back to the market , their long position is said to be ‘closed’ and the trade is complete. The ask price is the value at which a trader accepts to buy a currency or is the lowest price a seller is willing to accept. The bid price is the value at which a trader is prepared to sell a currency. DotBig using leverage allows you to open a position by putting up only a portion of the full trade value.
In the context of the foreign exchange market, traders liquidate their positions in various currencies to take up positions in safe-haven currencies, such as the US dollar. Sometimes, the choice of a safe Forex news haven currency is more of a choice based on prevailing sentiments rather than one of economic statistics. The value of equities across the world fell while the US dollar strengthened (see Fig.1).
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If you want to open a short position, you trade at the sell price – slightly below the market price. When trading with leverage, you don’t need DotBig company to pay the full value of your trade upfront. When you close a leveraged position, your profit or loss is based on the full size of the trade.
- A good example of this pattern at work is shown in the chart below.
- Factors likeinterest rates, trade flows, tourism, economic strength, andgeopolitical risk affect the supply and demand for currencies, creating daily volatility in the forex markets.
- If you want to open a Forex trading account, simply click on the buttons below.
- A very important part of your trade plan should consist of your money management and risk assessment techniques.
- Other economists, such as Joseph Stiglitz, consider this argument to be based more on politics and a free market philosophy than on economics.
- First, you can look at the news of the day and identify whether they are positive or negative for a certain currency pair.
You can even build strategies to execute your trades using algorithms. You can read more and download the trading platforms from our trading platforms page. As a leading global broker, we’re committed https://www.dukascopy.com/swiss/english/forex/trading/ to providing flexible services tailored to the needs of our clients. As such, we are proud to offer the most popular trading platforms in the world – MetaTrader 4 and MetaTrader 5 .
Carry Trade
By continuing, you declare that you have read, understood and accept the Terms and Conditions and you agree to open an account with EF Worldwide Ltd. Please contact Customer Support Department Forex news if you need any assistance. Simply answer a few questions about your trading preferences and one of Forest Park FX’s expert brokerage advisers will get in touch to discuss your options.
Fundamental analysis – this is a strategy that involves looking at the news of the day and then predicting the future direction of a currency pair. In a section below, we will focus more on the need for having a forex trading strategy and then identify some of them. As you https://generalknowledge360.com/a-detailed-review-of-the-conditions-of-the-dotbig-broker/ start your trading journey, ensure that you have a good strategy that you have developed and tested for a while. As you will notice later, it is mandatory for you to do chart analysis as a forex trader. This type of analysis is known as technical and price action analysis.