UNDERSTANDING

THE BASICS OF FX TRADING

UNDERSTANDING THE BASICS OF TRADING
What is Forex?

Forex (or FX) is short for Foreign Exchange On Forex markets, you do not actually
market. The fundamental idea is to purchase the currency. You simply make a
prediction: X currency will gain value over Y
exchange one currency for another to gain
currency in a given time.
profit.
If you exchanged currencies before, you Traders make educated guesses by analyzing
know that as a result of the exchange the economy, past trends and major expected
events. This process is called ‘trading forex’.
you either gain or lose money. It
depends on how one currency gained The more technical term is trading Contracts
more value than the other since your for Difference (CFDs). We will learn more
purchase. about CFDs other than FX later.

BASIC FX TERMS
Currency Pair : Quotation of one currency against another. The most
common pair is the Euro and US Dollar: EURUSD. The first one is called the
Base Currency., while the second is called the Quote Currency. CFD :
Contract for Difference

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Forex Trading How to Trade FX

Trading Forex is all about observing the currency pairs and Traders sign up with online trading brokers such as
their respective values over one another. If you can predict Exness to trade in FX market. Brokers provide access
the direction of the market, you make profit. It’s simple as that. to trading platforms.
Traders start live accounts, deposit investments and
The most commonly traded pair is Euro and U.S. Dollars. then open positions. Since trading with margin is
They are shortened as EUR and USD. Let’s use it as an possible in FX markets, brokers offer leverage to their
example: Judging by the current economic developments, clients. This means you can trade up to 2000 times
an FX trader more than your actual investment.
believes EUR will gain value over USD today. So, they take a In other words, you use margin to create leverage
position in the forex market and invest. If the market moves when trading.
in the expected direction, they will profit. If not, they will lose.

BASIC FX TERMS
PIP: Point In Bid Price: Ask Price: Spread: Margin: Leverage:
Percentage. For how For how The Minimum Ability to trade
It’s the much you much you difference amount of larger
smallest can sell a can buy a in buying funds you positions than
amount of currency currency and and need to trade. your actual
change in a pair. pair. selling account
currency Price. balance.
pair.

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HOW TO START AN FX ACCOUNT
Before starting to trade, it is advised to practice your skills with a free demo
account. Once you grasp the basics, you can start trading with your live
account immediately.

Demo Account Start by filling out our quick form

on the registration page.
A demo account has virtual currency
and poses no risk to your actual capital. Select “Open Your Account” and
You don’t have to deposit to start proceed to the secure client area.
practicing. Once you decide if you want to
practice or start trading right away,
follow the process and finish your
application. Either way, you will
receive your login details for
trading
platform via e-mail shortly.

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How to Install Trading Platforms

Start by downloading the trading Feel like trading on-the-go?

platform you chose while signing Download the apps to your
up. mobile devices instantly!
You have a wide range of options Once the software is ready on
here: Either download the desktop your device, login with the
version or use your browser as the details.
user interface.

METATRADER
MetaTrader (MT) is a common, efficient and easy-to-use
trading platform.
Exness provides you access to both MT4 and MT5 platforms.

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How to Install Trading Platforms

Start by downloading the trading Feel like trading on-the-go?

platform you chose while signing Download the apps to your
up. mobile devices instantly!
You have a wide range of options Once the software is ready on
here: Either download the desktop your device, login with the
version or use your browser as the details.
user interface.

METATRADER
MetaTrader (MT) is a common, efficient and easy-to-use
trading platform.
Exness provides you access to both MT4 and MT5 platforms.

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How to Install Trading Platforms

Start by downloading the trading Feel like trading on-the-go?

platform you chose while signing Download the apps to your
up. mobile devices instantly!
You have a wide range of options Once the software is ready on
here: Either download the desktop your device, login with the
version or use your browser as the details.
user interface.

METATRADER
MetaTrader (MT) is a common, efficient and easy-to-use
trading platform.
Exness provides you access to both MT4 and MT5 platforms.

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Hold on to this information as you will Your trade transaction log is seen
need it if you ever login on a new below the chart. Notice that your
device. account balance reflects the
Once logged in to your demo selected amount for this demo
account,
account. Your orders and free
you will see currency pairs on the
margin – the percentage of deposit
left-hand side with live quotes. On the
you need available to trade – will
right panel, you will see a chart.
Right clicking (or long tapping on be visible here.
mobile) will give you options to tweak You are all set for practice trading
this dashboard. with Exness!

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 Trade Example
This is your trading page. Go ahead and familiarize If you clicked SELL and the price kept
yourself with the menus and buttons. going down, you will notice that you are
profiting. In the opposite case, you would
For the purpose of this demo, we will simulate see a negative value. Either way, you can
trading EURUSD, one of the most traded FX pair. close your position anytime you want.
Notice that there is a downwards trend for the
past hour. This means the market is currently Alternatively, you could place a new order
bearish and the traders are mostly selling rather with certain conditions. Click the icon in red
than buying. square or long-tap the graph and you will
Top left corner of the graph shows you current see a more detailed order menu.
buying and selling prices for positions. The 0.01 is Notice that you can set certain conditions
the lot, your trading volume. for your order. Thinking the price will
increase? Place a buy order with a target
If you were to click either SELL or BUY here, the price using Take Profit. To minimize possible
system will first ask permission for ‘One-click losses, set a Stop Loss function.
Trading’. When you’re ready to close your position,
After your confirmation, you will start trading right-click or long-tap the order and ¬select
immediately. You will open a position based on ‘Close Position’.
the current market price. Congratulations! You have just traded Forex!

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Crunching the numbers

Example for Buying (Going Long) Example for Selling (Going Short) When should you buy/sell?
Let’s say you deposited 5000$ You have 4,000 USD in your CFD markets such as Forex are
in your account. You entered the account. You opened a sell always volatile and unpredictable.
market when the price for EURUSD position with one lot (100,000 There is no clear ‘winning formula’.
is 1.11000. You buy one lot (100,000 units) at 1% margin (100:1 leverage). Experienced traders develop
units) with Euro at 1% margin (100:1 Currently EURUSD is at 1.2000. So,
their own systems over time by
leverage). We set aside 1,100 USD in we set aside 1,200 USD in your
account to open this position. With
studying the market and using
your account to open this position. analytics tools. FairMarkets
With leverage, your lot is now leverage, your lot is now worth
120,000 USD. As you predicted, customers enjoy a wide variety of
worth 110,000 USD while trading. assistance tools to make informed
the price decreased and EURUSD
Meanwhile, you have 3,900$ free decisions.Check our selection of
is now 1.18000. You close the
margin left in your account. As you position and make 2000$ profit. tools, analytics and newsletters to
predicted, the price increased and Your profit is immediately reflected gather more information about the
EURUSD is now 1.12000. You close to your balance. You get back market.
the position and make 1000 $ profit. your initial deposit of 1,200 USD.
Your profit is immediately reflected to Now you have 6,000$. If you kept
your account balance. You get back the position open overnight, you
your initial deposit as well. You now will pay and earn interest for both
have 6,000$. If you kept the position currencies as a result.
open overnight, you will pay and
earn interest for both currencies as a
result. Because you borrowed EUR
and lent USD.

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How to Deposit

To trade in the Forex markets, you need to Once the process is complete, your balance
provide a certain amount of margin. You will reflect the change. Also, you will receive
can deposit the amount you want to trade
into your Exness Account easily. a confirmation mail from us shortly. Got
comfortable trading on a demo account by
Login to your Secure Client Area (SCA) by now? Then it's time for a live run!
clicking “Exness” on our home page.
Login to your trading platform with your
Deposit page greets you with several
live account details and join the millions of
options for topping up your account.
Choose your method and proceed with the FX traders. The process is exactly the
payment. The quickest method is using a same as demo trading.
Bank/Credit Card.

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TRADING WITH EXNESS
Exness value your business and do our best to become your innovative,
long-term trading partner. Exness provide bonuses, advanced trading and
analytics tools to equip you for the challenges of the market.
Top reasons why you should start your trading journey with us:

Ultra-tight Wide Range of Innovative BVI Regulated Lightning-fast Customer

Spreads Products Technology Broker Execution Support 24/5

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WHAT ELSE IS OUT THERE?
While Forex is the most popular form of CFDs, Producsts such as Equities, Indices
and Commodities are great ways to diversify your portfolio and minimize your
investment risks.
Equities Indices Commodities
Also called Shares or Stocks, An index is a group of company Traders looking for less volatile
they represent a percentage of a shares traded together. products enjoy trading
publicly listed company. Similar Grouped shares gain and lose commodities such as Gold, Oil,
to Forex, you can trade Equities value together as shares of big Gas or Cotton.
as Contracts for Difference companies usually set the pace Global events, weather
(CFDs) on our platforms. and value.
conditions and major economic
You do not actually buy the Exness offers you a top developments determine
shares of these companies. selection of over 20 baskets prices of these products which
You simply take a position in the such as DAX30, NAS100 and tend to keep their trends more
market, saying “These shares SP500, either spot or in futures straightforward compared to
will increase/decrease in value contracts form. unpredictable markets such as
in a given time period.” This Forex.
way, you can make profit even
if the shares are actually losing
value.

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