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In FX trading, currencies are traded in pairs.
Major Currency Pairs:
These are the most frequently traded and most liquid pairs. They involve the U.S. dollar (USD) paired with one of the other major currencies (EUR, JPY, GBP, CHF, CAD, AUD, NZD).
Cross Currency Pairs:
These are pairs which do not contain the U.S. dollar. Main crosses are also known as “Minor Currency Pairs” and include pairs between the major currencies.
Exotics consist of one major currency paired with the currency of an emerging economy.
The Capital market is traditionally separated into three sessions, which overlap during the day. These are the Asian session, the European session, and the North American session.
Market players include major banks (also known as the “interbank market”), governments and central banks, smaller banks, large commercial companies and hedge funds, brokers and retail ECNs. The last two act as the intermediary party between buyers and sellers, enabling retail traders to gain access to the liquidity providers.
Learn Online Trading
Trading is the buying and the selling of specific security.
EUR/USD = 1.08835
This is a foreign exchange rate for the euro versus the U.S. dollar.
The first listed currency is called the “base currency” and the second listed currency is known as the “term currency”, or “quote currency”.
In FX trading, the base currency is the basis for any buy or sell action.
The above exchange rate tells us that 1.08835 US dollars are required to purchase one euro. If you are buying EUR/USD, you are buying euros and selling American dollars. If you are selling EUR/USD, you are selling euros and buying American dollars.
Bid / Ask
On your trading platform you will see two different prices for each currency pair.
These two different prices are known as the “Bid” and “Ask” prices for the current Instrument.
The Bid price is the price on the left and is lower than the Ask price. It is the price at which you can sell.
The Ask price is the price on the right, and is also known as the “Offer price.” It is the price at which you can buy.
The difference between the two prices is known as the spread.
Opening and Closing Positions
Online trading involves both buying and selling. You open a position with the first action you take, whether that is buying or selling a currency pair. Closing the position you have opened requires you to perform the exact opposite action.
Remember that you buy an instrument at the Ask price and close your position at the Bid price. If you are selling a currency pair, you are doing so at the Bid price and closing your position at the Ask price. Chart prices display only the Bid price of a currency pair by default.
Go Long / Go Short
To “go long” means to buy a currency pair with the expectation that it will gain value. Selling the currency pair once it appreciates will result in profit.
To “go short” means to sell a currency pair, expecting that it will depreciate. Buying the pair once it depreciates will result in profits.
Why Trade with RHODIUM
No dealing Desk Execution
We operate a No-Dealing-Desk and our interests are aligned with those of our clients.
Safety of Funds
All client funds are kept separate from companu funds. RHODIUM protects clients funds helding them with reliable banks.
Best in class Technology
Our cutting-edge technologies ensure that 99.99% orders are executed within 100ms and we can process up to 3000 orders per second.
Our deep liquidity from multiple tier one banks and advanced execution technologies allow us to offer highly competitive prices.
Exclusive trading tools
The experience of our traders is our top priority, which is why we develop exclusive trading tools, as well as offering expert analysis and educational resources to help you become a better trader.
Use leverage wisely
While leverage can certainly multiply the gains from a winning position, it can also multiply the losses you incur if a trade doesn't go your way. This is particularly problematic when trading a small account as a losing trade can quickly wipe you out.