This is the order that was given to your broker for taking you out of the market in case the trade fails and
goes against you. In such a case, you sould tell to your broker that if this trade reverses against my analyze direction, take me out of the market at this level to stop my loss. NOTE: It is very important for you to input stop loss in trading, or else you will invite tsunami. Imagine this scenario in theGBPCHF chart below, imagine you are buying this trade and you didn’t put stop loss, your account will be blown by such unforeseen occurrences like this. So STOP LOSS is a MUST.
This is the price level you set in such a way that if price move in your favor and price reach that level, the broker should take your profit and add it to your account balance. Or an order in term of price given to your broker to take your profit once the price moves to your target price level.
The order to buy or sell can be Instant as shown above or a pending order. Instant order is when you buy at the current market price. If at the moment in the market the price for EURUSD is 1.4200/1.4203 To Order at market price or Instant Order is to buy or sell at this price without waiting for the price to
come down or go up before you take action.
PENDING ORDER: Pending Order is into 4 categories.
This is to buy below the current market price. This happen when you forsee that the price will come down (retrace) and instead of buy at a high price, let me buy when the price is cheaper than what the market is offering me now. In this case, you place a buy limit.
This is to sell the market when you have done your analysis and forsee that the market will likely go up before it finally sell (retrace). This is an order used to short the market. If the price currently is 1.201 and you see that it will get to 1.220 and hit a resistance (a level it cannot push up again before coming down) then you place a sell limit at 1.220. In that case once the market gets there, the broker will place a sell trade for you.
Is an order given to your broker to buy the market when the price is above the current market price. Assuming you want to trade buy on EURUSD. And you forsee that it might likely sell before it buys and you are not sure or you see a resistance which might likely cause the price to retrace or fall. In such a case, we place buy Stop to join the market once the market has finally able to break the resistance and in order not to miss the opportunity. It is this type of order that help us to join the
Is an order given to your broker to sell the market for you when the price is below the current market price. This is done in a case when you want to be sure the market is actually going in the intended direction before you join the market. Assuming you want to trade sell on EURUSD. And you forsee that it might likely buy before it sells and you are not sure or you see a support which might likely cause the price to retrace or bounce up. In such a case, we place Sell Stop to join the market once the market has finally able to break the support and in order not to miss the opportunity. It is this type of order that help us to join the opportunity.
This is the amount charge by broker for each sell or buy you place on their platform on each currency pair. And it is calculated by subtracting the buy from the sell. In case of the above example, the spread is (1.42429-1.42483) which is 0.00054. In real sense, disregard the 0000 before 54. This broker charge 5.4 pips for EURAUD pair. Some can charge more or less, it depends on the broker. Spread is how brokers make their money from traders legally.
The time frame starts from 1mins, 5mins, 30 mins, 1hr, 4hrs, daily, weekly and monthly time
frame. The red arrow shows where you can find it on the MT4
This Green Icon is where you can insert Indicators to add to your chart. See list of Indicators below
This is what you will press to zoom in or zoom out your chart. That is, to reduce the size of the chart or enlarge the chart.
- Blue Arrow-It indicates Horizontal line. Whenever you want to draw support and resistance, you click on it to draw horizontal line for support and resistance.
- Green Arrow– It indicates Trendline. Trendline is also use to draw support and resistance. You click on that arrow when you want to draw Trendline.
- Purple Arrow: It indicates Fibonacci. Fibonacci is also one of the trading tools you can use for trading. But in this manual, you may not necessary need it or use it.
- Yellow Arrow: It indicates the market watch. It is here you can see all the currency pairs and commodities to trade. See picture below. You can see Bid/Ask is same as Sell/Buy
You will see this as shown in the snap shot below
This is your capital. Assuming you deposit $100 today into your trading account. That $100 is your equity. And the more profit you gain through trading, it will be added to your equity, likewise if you lose, it will be debited from your equity.
Balance is your equity +/- your profit or loss. For instance, in the above snap shot, the balance is $412; the equity is$362.96 while the profit is -$49.58. This means, assuming there is no negative profit of -$49.58, the potential total amount of money is $412. If the trade is successfully close in profit, that profit will be added to the equity and it will be the total balance in your account.
Margin is the amount of money your broker will take from your equity/capital to open a trade for you anytime you requested to buy or sell. It is like this. You want to buy goods from Walmart stores to resell. The money you take to Walmart to trade is refer to as margin in forex trading. Assuming I am opening a buy on EURUSD, the broker will take about $24 from my account to open that trade. If the trade is successful, and I close my trade in profit, the margin together with the profit will be added back to my account.