whats the biggest transition from stock market to forex?

[Tekfreak]

Since i consider myself pretty good in the stock market whether it be fundamentals, charts, whatever, and i know a lot of those skills will be transferable, especially charting, whats the biggest thing thats a change going into the forex market? i just dont know ehere to start, and want to know what extra research in what topics i should do before i try my hand at it? should i just dload that free forex.com trial software and watch how the market goes during the evening and "pretend pick" what point i would have entered and exited and see how i do?

[Tekfreak]

so im using the forex.com demo and 2 irks


no volume view? why cant i see volume?
once i draw trend line i cant erase it

[Tekfreak]

nevermind i figured how to clear the lines.

so i was watchign the chart of the usd/gbp, and it was at 1.7653, and i predicte dit would hit 1.7660, and it hit 1.7663. does that mean i scored 10 pips? and how much money would that be?


ok so i tried paractic ebuying selling. i dont understand the lots. like, i have 2,000$ in this practice mini account, but i bought a lot of 10,000 GBP for 1.7662 which is 17,766 dollars. how exactly does that work? makes zero sense to me tek so lost

[Tekfreak]

19:49:00> Deal Confirmed: 17530473
You Sold GBP 10,000
You Sold At 1.767
You Bought 17,670
19:48:59> Deal Request: Sell GBP 10,000
19:43:33> Deal Confirmed: 17530241
You Bought GBP 10,000
You Bought At 1.7662
You Sold 17,662
19:43:32> Deal Request: Buy GBP 10,000

[jon]

Originally Posted by Tekfreak

nevermind i figured how to clear the lines.

so i was watchign the chart of the usd/gbp, and it was at 1.7653, and i predicte dit would hit 1.7660, and it hit 1.7663. does that mean i scored 10 pips? and how much money would that be?


ok so i tried paractic ebuying selling. i dont understand the lots. like, i have 2,000$ in this practice mini account, but i bought a lot of 10,000 GBP for 1.7662 which is 17,766 dollars. how exactly does that work? makes zero sense to me tek so lost

Tekfreak,

I'm relatively new to Forex, but hopefully I can be of some help. First of all, volume really isnt an issue at all because the 7 major currencies generate almost 2 trillion dollars per day in volume, making it by far the world's most liquid market. All orders go through instantly and you really dont have to worry about volume.

Yes, you are correct in that you scored 10 pips. In a standard account, when trading losts of 100,000 1 pip equals 10 dollars so you would have made profit of $100. In a mini account, on the other hand, 1 pip equals 1 dollar because each lot is 10,000. In that case, you would have made $10 if you bought 1 lot, $20 if you had bought 2 lots, and so on.

Also, I'm not sure if you know this yet, but the brokers make their money off the spread. So when you see for example EURO/USD with a sell of 52 and a buy of 55, the difference between them (the spread) goes to the broker.

Hope I helped some.

-Jon

[Tekfreak]

i made 13 pips allready. to have a REAL account where each pip is 10 bucks, how much equity do i have to have in my accout?

[jon]

Originally Posted by Tekfreak

i made 13 pips allready. to have a REAL account where each pip is 10 bucks, how much equity do i have to have in my accout?

$2500 is the minimum with most brokers but that only gives you $250,000 on margin and thats risky since each lot is 100,000. If you bought one lot and the currency tanked you could lose the whole $2500 you started with. It's best to start with about 10 grand if you want to be making 10 bucks a pip.

[wolf825]

Heya Tek,
IMO the biggest transition from Stocks to Forex is the speed at which change happens. Unless you were a daytrader, this can catch you off guard sometimes.. To go from stock trading where you will buy and then probably hold it for a few days or weeks to see a move, Forex will move in a heartbeat. 8 hours in Forex with an open position can be a long long time..and in that time your positin could increase or decrease tenfold..

Also, trading Forex is something that requires your attention while your positions are open..and it requires you to have your plan in place when you buy, for stop loss, OCO orders and any profits you wish to make. If you are good at TA, then GREED is the next biggest animal to overcome in Forex..cause when you get greedy is when you screw up and lose. Its VERY easy to take your little 10 or 15 pip profit and then see things continue for 40 pips--and you stop and wonder "if only" or "what if" to having stayed in the position.. Learn to be happy with whatever profit you get..because 10 pips profit here and there CAN and DOES add up greatly... Don't be in a hurry...take what you can get and be hapy.. I have found all too often when you get greedy and hold out for another 10-20 pips or more past your plan, things can change on your and you may end up with less then the 10 pips you started out with... Just some friendly advice...

As to understanding the Leverage you are using--think of it as a margin account where you use a small amount of your money to buy or leverage on loan a larger amount of money, however all you risk is the actual fund you put in. Where your leverage is 100:1, then every 100$ will buy you $10k of currency, where a 200:1 leverage will be every $50 of real money will buy you the same $10k in currency and so on. Depends on your leverage.. In a Mini-account, a typical "Lot" is $10k...and each pip change will give you $1 in profit or loss or $1 in value per pip.. In a full blown account where you have depsoited a typical minimum of $2500-5k of real cash, things go up. 1 "Lot" is typically $100k in currency and will cost you $1k in real money in 100:1 leverage..or $500 with 200:1 leverage etc etc...and each pip will be about $10 in value for profit or loss.

I would suggest as I do to everyone, play with the Demo's a while...I encourage folks to play Forex demos for at least 2 months before diving in with real cash. There is no hurry with Forex as opposed to catching a Stock before it runs--Forex is always moving and always trading and you can always make money whether the price goes up or down...there will be another trade later or tomorrow. Learn to trade deliberately, patiently and controlled and with all due dilligence...

Hope this helps... If you need some help with understanding leverage more, just post back...
-w

[Tekfreak]

i mean ive daytraded a few times on my days off work so i know how to react. just wish i could use stuff like L2 and volume to gauge movement like in stocks. all it seems like u have is TA and news with forex market. but u r right that stuff moves fast as hell def. need more days playing this at night to get a better feel. In your opinion what is the best currency to trade, aka plays off TA the best, seems to move the most with EMAs, resistance, supprt, ect?