To be successful in Forex trading you need to know the purpose of Forex trading. You know Forex trading is the key to online currency trading and the key to success is to buy less and sell more like any other market. Your job as a Forex trader is to try to determine the trend of the particular currency you want to buy or sell and to use Forex trading techniques to ensure profit.
Now that you know the purpose of Forex trading the next step in learning everything about Forex is to understand the codes, definitions and numbers used when trading. All currencies used in Forex trading are assigned a three letter code. An example of this is the US dollar which is USD or Euro EUR. Online currencies are traded in combinations known as crosses and are represented by 6 letter words and more expensive currencies come first. An example of this is GBPUSD which will show you how many US dollars you have to pay for one British pound. These rates are represented as a five-digit number, for example GPBUSD = 1.6262, which means the value of 1 British pound is 1.6262 US dollars. If the rate changes, the change will be displayed in bold, such as GPBUSD = 1.6264 which means that the rate has increased by 2 points. Knowing this is the key to successful Forex trading and the key to your profits.
When you enter the Forex trading market you enter as a buyer or seller of a certain currency. If you are a seller, your price is known as ASK price and buyers price is known as BID. You can only buy coins from a seller with a query price similar to the BID price.
It can make a big difference when it comes to your profits when it comes to forex trading and knowing what the purpose of forex trading is and knowing everything about forex before entering the market.