fx currency trading

12 Important Terms In Currency Trading - Currency Pairs Used In Fap Turbo And Forex Megadroid

Some of the important terminology used in Forex currency trading are listed below:
(1)Currency pairs: In Forex trading, traders either buy or sell currencies. This trade takes place with forex currency pairs. To understand, lets assume that you buy GBP with USD. When the British Pound rises relative to the Dollar, you sell it to make profit. There are many currency pairs available in a Forex trading system. The most commonly traded currency pairs are: EUR/USD (Euro vs. U.S. Dollar), GBP/USD (British Pound vs. U.S. Dollar), USD/CHF (U.S. Dollar vs. Swiss franc).
(2)Base currency and quote currency: The value of one currency is determined by its comparison to the value of another. The first currency that you find written in quoted currency pair is known as the base currency while the second currency is called the counter or quote currency. In GBP/USD, the GBP is the base currency and the USD is the counter currency.
(3)Value of quoted currency pair: To understand this let us take an example. Let say, you purchase a currency pair. It reads as USD/EURO=2.50. This means for every 2.5 Euros that you sell, you get US $ 1. If you sell the currency pair, you receive 2.5 Euros for every US $ 1 that you sell.
(4) Bid and Ask: The forex currency is usually traded with bid and ask price. The price at which the broker wants to buy is 'bid' price and the price at which he wants to sell is 'ask' price.
(5) Pair trading: It will be now easy to understand pair trading. As the value of one currency is seen with respect to another, it is called currency pair. When you hear the value of currencies like the Japanese Yen or Canadian Dollar, it's value is seen with respect to the USD.
(6) Cross currency: A currency pair in which neither is U.S. dollars is called cross currency.
(7) Support level: When the price movement is downwards, the lower price level at which the price movement changes (while going downwards) and start moving upwards is called support level.
(8) Resistance level: When your currency pair reaches a higher price level and then retraces back, this higher price level is called resistance level.
(9) Lots: It is the size of the forex transaction. A standard lot comprises of 100,000 units while a mini lot has 10,000 units. However, you may come across brokers offering a lot of 1,000 units.
(10) Market order: Market order is a commonly type of order used to enter a trade at the latest market value.
(11) Limit order: Limit orders are set numbers to sell at when the currency reaches a certain point. Or to put in other words, this limit order is used to buy and or sell when the trade achieves a certain price in the market.
(12) Stop order: It helps the traders against the potential losses by pulling out.
These are some basic terms used in forex trading and you must know about all of them. Fap Turbo is one such trading software which is capable in trading multiple currency pairs. While forex MegaDroid makes excellent profit in only the USD and Euros.