A spread is the difference between the bid and the ask price. The bid price is the price at which you may sell your currency pair for. The ask price is the price at which you must buy the currency pair. The ask price is always higher then the bid price. Profits in the market are made from charging the ask price for a currency pair and buying it from someone else at the bid price.
The bid/ask spread increases when there is uncertainty about what is going to happen in the market.
Technical Definitions
Trading PlatformA trading platform is, along with the charts, one of the most important tools that a trader will be using while trading on the Forex market. By definition, a trading platform is an exchange account where you can buy and sell a currency.
Entry StopAn entry stop is executed when the exchange rate breaks through a specific level. The client placing a stop entry order believes that when the market’s momentum breaks through a specified level, the rate will continue in that direction. The execution of a stop entry order may involve a limited degree of slippage, usually two pips or less.
Entry Limit
An entry limit is executed when the exchange rate touches (not breaks) a specific level. The client placing a limit entry order believes that after touching a specific level, the rate will bounce in the opposite direction of its previous momentum. Limit entry orders are always executed at the specified level.
No comments:
Post a Comment