How to Get Money from Forex Trading?

Introduction
In the FX market we buy or sell currencies. Where trading mechanisms are very similar to those in other markets in General (such as shares). So it's quite simple, and if you have experience in stock should you will not encounter difficulty in trading forex. The purpose of forex trading is to expect that prices will change which currency you buy have an increased value, so that you gain from the difference in the value.

EXAMPLE TRADE	EUR	USD
You purchase 10,000 euros on pair	+10,000	-11,800*
1 week then you switch back to 10,000 u.s. dollars at the exchange rate of 1,250.	-10,000	+12,500**
You gain $ 700	0	+ 700

 

Exchange rate/Rate is the ratio of one currency valued against other currencies.
For example, the USD/CHF exchange rate shows how much US dollars can buy one franc Switzerland, Switzerland franc or how much You need to buy one u.s. dollar.

The writing pair/pair forex is always written in pairs, such as EUR/USD or USD/JPY. The reason why they are written in the pattern of the pair, is because in each foreign currency transaction we are simultaneously buying one currency and selling another.

The following is an example of the exchange rate for the pound sterling versus the u.s. dollar: GBP/USD = 1,7500 the first currency listed on the left of the slash ("/") is known as the base currency (in this example, United Kingdom Pounds), while the second one on the right is called the counter currency (in this example, u.s. dollars).

When purchased, the exchange rate tells how much you must pay to buy one unit of the base currency. In the example above, you would have to pay 1,7500 u.s. dollars to buy 1 pound sterling United Kingdom.

In forex trading, you will buy a pair/couple if you believe that the value of the base currency will increase or rise. And instead, you will be selling a pair if you think basic currency will depreciate (down) relative to the currency counter.

Forex Transactions
Buy/Sell (Buy/Sell)
In the forex trading terms that are commonly used are:
Buy or Long or buy it: If you think the base currency will go up.
Sell or Short or selling: If you think the base currency will go down.

Difference between supply and demand (Bid/Ask Spread)
Quote (Bid) is the price at which you as the merchant will sell the base currency.
Request (Ask) is the price at which you as the merchant will buy the base currency.
The bid price is always lower than the demand, and the difference is often referred to as a Spread. In forex trading, this difference in the broker usually take advantage as the cost of their services.

Close/Close Transactions
After you buy a pair, of course, later You will be selling more to realize a profit. Well in forex it is popularly called by Close.
So:
If You Buy the original, to close means CLOSE (Sell)
If You Sell the original, to close means CLOSE (Buy)

Good to here you have learn ultimate 3 in forex trading are:
Buy/Sell, Close, Bid/Ask Spread, as well as
Next let's look at how we can earn money from forex trading (this might be Your waiting for reply from last)

Profit/money from forex trading
Let's look at an example of a common quotation displayed in an online forex trading system.

GBP/USD
THE BID ASK
1.2800 1.2804
SELL BUY

Look above that spreads on forex pair GBP/USD, bid prices and ask prices 1.2800 is is 1,2804.
Such as Your current estimated value of GBP will be strengthened/ride.
Then you take a BUY/sell GBP/USD at 1.2804
After some time, the price change (See display below)

GBP/USD
THE BID ASK
1.2820 1.2824
SELL BUY

Seen here that what You predict correctly. And the value of the GBP/USD is moving up.
Well, now is your chance to be able to realize a profit by doing CLOSE (Sell), so Close (Sell) GBP/USD at 1.2820

So from 1 trade transactions last advantage is you get are:
1.2820-1.2804 = 16 Pip (Pip is the smallest possible price movements in currencies).

Well, now the question is, what if it turns out the price of GBP/USD move against/does not comply with Your estimates.(See display below)

GBP/USD
THE BID ASK
1.2770 1.2774
SELL BUY

If you do CLOSE (sell) at this position. Means:
1.2770-1.2804 =-34 Pips (you lose 34 Pips)
Well, when You do this it is up CLOSE, with Your analysis.
If the GBP/USD will continue to fall (preferably close now for meminimal loss), or you believe the GBP/USD will back up (don't close it now, wait for the ride back to get a profit (+))

So simple?

So Pip yg you are getting here is the profit/money means to you.

Furthermore, what is the value of money from Pips which obtained.??
Pip will be equivalent to money/dollar, depending on the number of lots, large contracts, as well as the leverage that you use.
Illustration of the calculations assuming use of contracts a standard reply.
Profit ($) = Difference X Contract Size X Lot ($)

So from the above examples, the profit ($) = 1.2820-1.2804 (16 Points) x 100,000 ($) x 1 = $ 160

Advantage for us right now is, the average of all platforms/software trading from brokers have done a calculation process above automatic seacara.
So we easily know the equivalent of our advantages without the need to hard-hard to count again.

Perhaps for those of you who like to count:), you can see a description of how to calculate the profit pips here. You can also get to know more deeply whether it's leverage, which allows us to Transact the equivalent of $ 100,000 with only a capital $ 1000