junior forex question

O

orangelam

i am new in forex. can anyone explain to me below query?
1)can i both long/short forex just like futures? or it can only be done in long direction like stock?
2)which exchange is the most liquid for forex?
3)can i say forex is the easiest asset to be scale up? say one tick corresponding to several million?
 
you can both long and short fx (btw you can short stocks too)
there is no exchange in forex spot, it's a decentralised market so it's your brokers market making or ECN. If you want to trade fx in a centralised market place there are the futures on the CME
Easiest is a relative term but yes you can easily do size of a few millions in fx
personnally I like Tickmill.co.uk for forex
 
Hello here are your answers-
1- Yes you can open both long and short positions on any type of instrument.
2- There are 7 major pairs which are considered to be most liquid pairs of the forex market -
  • The euro and US dollar: EUR/USD.
  • The US dollar and Japanese yen: USD/JPY.
  • The British pound sterling and US dollar: GBP/USD.
  • The US dollar and Swiss franc: USD/CHF.
  • The Australian dollar and US dollar: AUD/USD.
  • The US dollar and Canadian dollar: USD/CAD.
  • The New Zealand dollar and US dollar: NZD/USD.
3- No, one tick won't make millions for you, actually it depends on the lot size you are trading with and the leverage that you are using on your account. Always remember, if you trade on higher lot size with higher leverage you may observe slippage and there are more chances that the market may run against you.
 
tedmos38 said:
Hello here are your answers-
1- Yes you can open both long and short positions on any type of instrument.
2- There are 7 major pairs which are considered to be most liquid pairs of the forex market -
  • The euro and US dollar: EUR/USD.
  • The US dollar and Japanese yen: USD/JPY.
  • The British pound sterling and US dollar: GBP/USD.
  • The US dollar and Swiss franc: USD/CHF.
  • The Australian dollar and US dollar: AUD/USD.
  • The US dollar and Canadian dollar: USD/CAD.
  • The New Zealand dollar and US dollar: NZD/USD.
3- No, one tick won't make millions for you, actually it depends on the lot size you are trading with and the leverage that you are using on your account. Always remember, if you trade on higher lot size with higher leverage you may observe slippage and there are more chances that the market may run against you.
More...
its a very good reply with nice information ,
got some fine lines , thanks for your nice post again.
 
tedmos38 said:
Hello here are your answers-
1- Yes you can open both long and short positions on any type of instrument.
2- There are 7 major pairs which are considered to be most liquid pairs of the forex market -
  • The euro and US dollar: EUR/USD.
  • The US dollar and Japanese yen: USD/JPY.
  • The British pound sterling and US dollar: GBP/USD.
  • The US dollar and Swiss franc: USD/CHF.
  • The Australian dollar and US dollar: AUD/USD.
  • The US dollar and Canadian dollar: USD/CAD.
  • The New Zealand dollar and US dollar: NZD/USD.
3- No, one tick won't make millions for you, actually it depends on the lot size you are trading with and the leverage that you are using on your account. Always remember, if you trade on higher lot size with higher leverage you may observe slippage and there are more chances that the market may run against you.
More...
You explained it really well.
 
Good reply from the second guy. I'll like to comment on the "make million" part. In Forex you need more than $100,000 to make reasonable income as a long term trader. Using leverage and increasing lot size with low capital is risky. It also depends on the platform or broker used, due to slippage that can hurt you all the time. I use Forexchief offering 1:1000 leverage, but I dare not use it. Maybe one of these days. Bottom line, be careful with leverage and volume. Read and apply the risk management rule of Forex.
 
Andras said:
Good reply from the second guy. I'll like to comment on the "make million" part. In Forex you need more than $100,000 to make reasonable income as a long term trader. Using leverage and increasing lot size with low capital is risky. It also depends on the platform or broker used, due to slippage that can hurt you all the time. I use Forexchief offering 1:1000 leverage, but I dare not use it. Maybe one of these days. Bottom line, be careful with leverage and volume. Read and apply the risk management rule of Forex.
More...
using high leverage with low capital really is a risky issue , the risk ratio increases more and more when you have low trading plan including zero risk management.
 
thanks for all the answers! learn a lot. one of the main concern apart from trading the liquidated currency pair is that you finally need to convert the profit to your home currency. i guess still a risk, right?

i have a general question about all trading. in your back test, you assumed a fixed entry and exit price. but in reality, you may not do as many lots/shares as you like and if you use market orders, you may finally fill worse price because not enough lots/shares placed in the bid ask query. if you place limited order, the price may run against you so that you won't get filled. so the scaling up of a trading strategy is limited. i think this is the universal problem for all trading firm. is this the main reason so that they need to develop multiple strategies to multiple markets? and also for diversification.
 
tedmos38 said:
Hello here are your answers-
1- Yes you can open both long and short positions on any type of instrument.
2- There are 7 major pairs which are considered to be most liquid pairs of the forex market -
  • The euro and US dollar: EUR/USD.
  • The US dollar and Japanese yen: USD/JPY.
  • The British pound sterling and US dollar: GBP/USD.
  • The US dollar and Swiss franc: USD/CHF.
  • The Australian dollar and US dollar: AUD/USD.
  • The US dollar and Canadian dollar: USD/CAD.
  • The New Zealand dollar and US dollar: NZD/USD.
3- No, one tick won't make millions for you, actually it depends on the lot size you are trading with and the leverage that you are using on your account. Always remember, if you trade on higher lot size with higher leverage you may observe slippage and there are more chances that the market may run against you.
More...
It is a great and very informative reply with detailed answers.
 
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