LEARN SMART AND TRADE EASY
CHAPTER 1
Basic
forex
The foreign exchange market is where currencies
are traded. This international market's most
unique aspect is that it lacks a central marketplace.
Instead, currency trading is conducted electronically over
the counter (OTC). This means that all transactions occur
via computer networks among traders worldwide rather
than on one centralized exchange.
The forex market is open 24 hours a day, Monday to
Friday. On Saturday and Sunday, the market is closed.
The market is also closed on major public holidays.
Traders will trade forex through a broker. A broker is
like a bank for traders who manage buying and selling
transactions and money in and out.
Forex market transactions in a day are as much as 3–6.6
trillion US dollars, according to the most recent
calculations.
In forex, there are two ways we can make a profit. On
an up graph, we can make a profit; on a down graph, we
can make a profit.
The main currencies in the forex
market are:
Currencies and pairs • The currency pair is
are divided into 3 types, divided into 3 categories:
namely major, minor, major pair, minor (cross)
and exotic. pair, and exotic pair.
• A major pair is a pair
• The most frequently
that has USD in it, for
traded currencies are example:
USD,EUR,GBP,JPY,CAD EURUSD/GBPUSDD/US
,NZD, AUD, and CHF. DCHF/USDCAD/USDJPY
/AUDUSD/NZDUSD
• A minor (cross) pair is not
paired with USD directly, for
example, GBPJPY, GBPNZD,
or EURJPY.
• Exotic pairs are currency
pairs of developing countries,
for example, USDZAR,
USDTRY, etc.
Symbol Currency
To trade in the forex market, we need the MT4
or MT5 app (which can be downloaded from the
App Store or Play Store) and need to use a
broker to make buying and selling
I suggest that
you guys use the
BOLD PRIME
broker
Just click the link below if you guys want to
register a trading account
CLICK HERE
There are 3 types of charts
that are usually used in the
forex market.
Candle name up and down
A bullish candlestick is a candle that opens at a low price
and closes at a high price. Bullishness is an upward
movement. His colour must be green, blue, or white,
usually.
A bearish candlestick is a candle that opens at a high
price and closes at a lower price. His colour must be
green, blue, or white, usually Bearish is a downward
movement.
THE TIME FRAME IS THE PRICE MOVEMENT IN THE
CHART ACCORDING TO A CERTAIN PERIOD OF TIME.
The time frame used on this platform is:
• M1 (1 minute)
• M5 (5 minutes)
• M15 (15 minutes)
• M30 (30 minutes)
• H1 (1 hour)
• H4 (4 hours)
• D1 (1 day)
• W1 (1 week)
• MN (1 month)
• 1 candlestick on timeframe D1 represents a 1-day price
movement.
• 1 candlestick in the H1 timeframe represents 1 hour of
price movement.
• 1 candlestick on the m15 timeframe represents the 15-
minute price movement.
THERE ARE ONLY TWO TYPES OF ORDERS: BUY AND
SELL BUTTONS FOLLOWED BY INSTANT (EXECUTION)
ORDERS OR LIMIT AND STOP ORDERS FOR EITHER BUY
OR SELL.
The image below shows how limit and stop orders are
used for buy and sell triggers.
Easy buy and sell concept
If you buy, the price goes up, and you can make a profit.
If Buy = Price Goes Down = Loss
If you sell, the price goes down, and you can make a profit.
If sell = price goes up = Loss
HOW TO EXCHANGE PIPS FOR POINTS AND POINTS
FOR PIPS
HOW TO READ PRICES IN PIPS
10 Points = 1 Pips
100 Points = 10 Pips
1000 Points = 100 Pips
10000 Points = 1000 Pips
UPTREND
DOWNTREND
SCALPERS
THIS TYPE OF TRADER FOCUSES ON A SMALL PROFIT OF
15–25 PIPS, WHICH IS ENOUGH. SCALPER USUALLY TRADES
MANY TIMES A DAY. A LOT OF PROFIT IS BASED ON MANY
OPEN POSITIONS AND COLLECTING A SMALL AMOUNT OF
PIPS FOR EACH POSITION. IS A SHORT-TERM TRADER. SL
SCALPER IS USUALLY 10–15 PIPS. SCALPERS USUALLY OPEN
LARGE LOTS.
INTRADAY TRADER
THIS TYPE OF TRADER OPENS LOTS BASED ON A WELL-
MADE ANALYSIS. THE POSITION IS OPEN FOR NO MORE
THAN 2–3 DAYS. ENTRY WILL USUALLY BE HELD. IS AN
INTERMEDIATE-TERM TRADER. ENTRY WILL USUALLY BE
HELD.
SWING TRADER
WILL HOLD THEIR POSITION FOR A WEEK TO THREE WEEKS
AND SEVERAL PERIODS OF TIME. IS A LONG-TERM TRADER.
THEY TRADE ACCORDING TO THE DIRECTION OF THE
MAJOR TREND, TIME FRAME H4, AND DAILY AS A GUIDE.
TRADERS WILL BE CHARGED DAILY INTEREST WHEN THEIR
POSITION IS LEFT OPEN FOR MORE THAN 24 HOURS,
ACCORDING TO THE RATE CHARGED BY A BROKER.
POSITION TRADER
THE ENTRY POSITION IS OPENED OVER A LONGER PERIOD
OF TIME, 1 TO 3 MONTHS, AND POSSIBLY MORE. THIS TYPE
OF TRADER HAS AN UNDERSTANDING NOT ONLY OF THE
FOREX MARKET BUT ALSO OF THE WORLD ECONOMY.
OFTEN, THE TRADER'S ACTIONS ARE BASED ON CURRENT
MARKET FACTORS. THE TIMEFRAME THAT IS THE MAIN
REFERENCE IS WEEKLY AND MONTHLY.
MOMENTUM TRADER NEWS TRADER
THIS TYPE OF TRADER WILL ONLY ENTER THE MARKET
WHEN THERE IS NEWS. THERE IS IMPORTANT AND BIG
NEWS, SUCH AS "HOT NEWS" OR
"BREAKING NEWS" INVOLVING THE ECONOMY THEY WILL
TRADE WITHIN A FEW HOURS.
MONEY MANAGEMENT IS THE MOST CRUCIAL FACTOR IN THE WORLD OF
FOREX; MM IS QUEEN AND SKILL IS KING.
• HOW TO MANAGE YOUR MONEY FROM LOSS
• HOW TO CONTROL YOUR EMOTIONAL
• HOW TO ENTRY SUITABLE LOT WITH YOUR CAPITAL
FOREX IS A BUSINESS; YOU HAVE TO THINK IN A BUSINESS WAY. PROTECT
YOUR CAPITAL; TRADING IS LIKE A MARATHON, NOT A SPRINT RACE. YOU
CAN BECOME A FULL-TIME TRADER IF YOU ALWAYS CONTROL YOUR
ACCOUNT PROPERLY. PUT THE TARGET IN PERCENT OR PIPS. TARGET
PERCENT
• ONE OF THE WAYS WE WANT TO CONTROL INCOME IN THE LONG TERM
IS THE % FROM CAPITAL TARGET.
• FOR EXAMPLE, OUR CAPITAL IS 1000 USD. • TARGET 1 DAY AROUND 5%
• 1000X5% = 50 USD PER DAY
• 5 DAYS = 250 USD
• THIS METHOD IS LOW-RISK IF YOU ENTER AT THE RIGHT TIME WITH AN
ACCURATE ANALYSIS OF TARGET PIPS.
• THERE ARE ALSO TRADERS WHO CONTROL LONG-TERM INCOME IN THE
FORM OF PIPS; • A 1-WEEK TARGET OF 500 PIPS
• IF WE ENTER 0.10 X 500 PIPS = 500 USD
• THIS METHOD IS ALSO LOW-RISK IF ENTERED AT THE RIGHT TIME WITH
THE RIGHT ANALYSIS.
BEFORE YOU START TRADING, YOU NEED TO KNOW HOW MUCH CAPITAL
YOU ARE WILLING TO LOSE
.
AND WHAT DO WE HAVE FOR ENTRY WITH THE CORRECT LOT? FOR
EXAMPLE, YOU HAVE 100 USD.
SL (STOP LOSS) 30 PIP
THE MAXIMUM ENTRY POSITION YOU CAN ENTER IS 0.10 LOTS.
IF YOU HAVE TO SL 30 PIP = 30 USD, YOU LOSE.
AND THERE ARE 70 USD LEFT IN YOUR ACCOUNT BALANCE.
THEN YOUR CHANCE FOR MC (MARGIN CALL) IS THREE TIMES SL IF YOU
OPEN LOT 0.10.
IF YOU PUT 0.50 FROM YOUR CAPITAL OF 100 USD, YOU DON'T HAVE SL
30 PIP; MC HAS KICKED YOU OUT, AND ALL YOUR BALANCE IS GONE.
0.50 X 30 PIP = 150 USD,
RUN AWAY FROM YOUR CAPITAL RATIO.
WILLING TO LOSE FOREX IS A HIGH-RISK, HIGH-RETURN TRADE.
MANAGE YOUR ACCOUNT PROPERLY.
