I know that many of you were waiting for this article. We have come a quiet long way. Isn’t it? I know that some of you are in a hurry to start trading. But I’ll say you to be patient. With time you’ll gain more experience and a good training. You may remember what we have done in the last article. Now you know how to open a Trading. This is what you basically do with MT4.
As I have told you we have to download the software for Trading. It’s very easy. Within few days you’ll learn to open trading very quickly. If you still have difficulties, look at the following video and see how to open and close a trading.
Now I hope those who had difficulties, understood the way to open and close a trading. It’s alright for you to open and close 10 or 15 Tradings while you are training. You have to practice that more often. Alright! It’s the time to progress to next step.
Instant Order
The orders we opened previously are called instant orders. We open them at once, after giving some amount of money. We can’t remove them once opened even if we feel useless. They will be instantly added to the Forex market and if we remove them our money will be lost. So this type of Trading is not opened all the time. You have seen that subtle changes in prices of various currencies in the market. If you see that it is possible to obtain a profit at once by a buy or sell order, it’s the time to use these instant orders. Now you may be thinking where I met this. You met it in the last article, where I explained the trading window. In that window we talked about account types. That is the place we met this Instant Order.
Pending Order
This option is situated just below the Instant Order option. You may wonder why there are two options. This is different. You can set this option to get activated when the Buy or Sell price cross a certain value that you set as a Pending Order. When you do this, the Order will be automatically activated once values reach the level we set. You can set both Sell trades and Buy trades this way. For an example think that GBP/USD unit price in the market is 1.5900 now. You want to buy when market price become 1.5870. Then you can use this method to open the buy order automatically when price reach there. See the image I have shown below. Change account type to Pending order (No 1) and then select whether you need to Buy or Sell (No 2). Then decide the price you need it to get activated automatically (No 4). Then click on the place order button in the window. (No 3). Then you can see this order being published under the chart we discussed (At the same place your Instant order was published). But still it is not an active trade. It will be activate when market prices will reach the set value. See the image I have shown you.
I hope now you have an understanding about the difference between an Instant and pending orders and how to open them. Train with your Demo accounts as it is important. You need a better understanding to do Trading.
Take Profit Option
You can arrange options to take profit along with pending order. We set the profits value to be taken at the same time with Pending order in this after the trading opened. For an example imagine that you need to open a buy order once market comes to 1.5850. Now market price is 1.5900. We can set the profit value with the order. You get the profits if market values go higher than set value. If values are at 1.5850, the new values have to be higher to obtain profits. So you can enter any value higher than that to have a profit. It’s approximately 1.570 and around 20 units away. That 20 is called as pips in Forex. I’ll tell you about that in the next article. Then the Take profit in Buy trades is a value higher than that and in Sell Trades, it is a lower value. I hope you understood. The advantage is that it work even when you are not in the internet.
Stop Loss Option
This is also easy. We can use this automatically if the market values are going too far towards the undesirable side after we open a trading. If it will continue to happen we will have to bear a great loss. We use this option to avoid that and minimize damage in such instances. When we predetermine the stop loss value, it will automatically stop the disadvantage. It’s the same way as you did in Take Profit Option. You have to enter a lower value than Buy Trades and a higher value than the Sell Trades. But this value has to be little higher than the value you entered above such as 40 or 50 pips.
What is PIPS
I mentioned you about PIPS. But I didn’t tell you what exactly it was. Now I’m telling that. See the way that Forex Market values are changing in the following image. GBP/USD values are taken as an example and you can see that they have changed as 1.5810, 1.5820, and 1.5830. Then you will notice that last values are changes from 10 to 10. It’s not 10 to 10. It’s 1 after 1. The ultimate value we get after summing all those values is the value we call as Pips. I have shown the foretold image here.
01. If Market Price 1.5810 - 1.5820 went up, the difference is Pips 10
02. If Market Price 1.5800 - 1.5801 went up, the difference is Pips 01
03. If Market Price 1.5800 - 1.5798 went down, the difference is Pips 02
04. If Market Price 1.5800 - 1.5900 went up, the difference is Pips 100
05. If Market Price 1.5800 - 1.5600 went down, the difference is Pips 200
I hope now you have understood everything I said. Either increase or decreases in the market values are called as Pips. I’ll ask you a question. How many Pips are there in the value 1.5800? The answer is 15800. Remove the decimal mark and see the answer.
It’s all for today. We will discuss something important in the next article. If you have questions, feel free to ask them. Try to find answers for these questions I have displayed.
Can you open a new Trading?
Can you close the Opened Trading instantly?
Can you open a Pending Order?
Can you enter Take profit, Stop Loss to a trading?
Can you explain what Pips is?
If you can’t find answers for some of them, you have to read again. This is not a fake method like Add click, Data Entry or E-money. This is trusted by whole world.
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