If you had a negative view for the Euro, perhaps because you felt that the Eurozone economy was performing poorly and was going to continue as such, you might look to short the Euro.

You might also have a view that the UK economy was looking healthy and that the short-term data was going to reflect this and beat expectations.

In this case, you would look to express your view by selling the Euro and buying the GB Pound, which would be a short position on the EURGBP currency pair.

Let’s say you sold EURGBP at 0.8500, with a target for a move down to 0.8000. You might then place a stop loss at 0.8700 in case the currency pair moved in the opposite direction.

• If the market moved down to 0.8000, you would realise a profit.
• If EURGBP moved up to 0.8700, you would be stopped out for a loss.

A forex account is a type of account that a forex trader opens with a retail forex broker. Forex accounts come in many forms, but the first that is opened is often the forex demo account.

1. Breakout
   This long-term strategy uses breaks as trading signals. Markets sometimes swing between support and resistance bands. Read more about breakout trading.
2. Moving average cross
   Another Forex strategy uses the simple moving average (SMA). Moving averages are a lagging indicator that uses more historical price data than most strategies and moves more slowly than the current market price.

Other strategies include:

Bollinger band strategy
Momentum indicator forex strategy
Fibonacci strategy
MACD forex strategy
RSI indicator forex strategy

Risks every beginner should be aware of.

There are different types of risks that you should be aware of as a Forex trader. Keep the following risks in your Forex trading notes for beginners:

1. Leverage Risk: Leverage in trading can have both a positive or negative impact on your trading. The higher your leverage, the larger your benefits or losses.
2. Interest Rate Risk: The moment that a country’s interest rate rises, the currency could strengthen. The boost in strength can be attributed to an influx of investments in that country’s money markets since with a stronger currency, higher returns could be likely. But if the interest rate falls, the currency may weaken, which may result in more investors withdrawing their investments.
3. Transaction Risk: This risk is an exchange rate risk that can be associated with the time differences between the different countries. It can take place sometime between the beginning and end of a contract. There is a chance that during the 24-hours, exchange rates will change even before settling a trade. The transaction risk increases the greater the time difference between entering and settling a contract.

Bid

The rate at which you can sell the base currency, in our case it’s the Euro, and buy the quote currency, i.e. the Japanese Yen.

Ask (or Offer)

The rate at which you can buy the base currency, in our case, the British Pound, and sell the quoted currency, i.e. the Japanese Yen.

Spreads

The difference between the Bid and the Ask prices.

Currency rate

The value of one currency expressed in terms of another. Its fluctuation depends on numerous factors including the supply and demand on the market and/or open market operations by a government or by a central bank.

Lot

Usually, the contract size is based on a lot system, and for most currency pairs 1 lot is 100,000 units of a base currency.

Pip

Minimum rate fluctuation

Account types

Pride Wealth Markets offers a variety of live and demo trading accounts, including Joint and Corporate accounts.