2.

Terms & Definitions to trading

1. MT5 trading platform and its features

2. What is Base/Quote currencies
3. What is BID price/Ask Price/Spread/Pip/Pipettes
4. What are LOT sizes- Micro, Mini & Standard Lot’s and its unit sizes
5. What is Buy by Market/ Sell by Market- Buy/Sell
6. How to enter & exit trades
7 . Setting Stop Loss & Take Profit
9. What is Trailing Stop
 1. MT4 trading platform and its features
- Real time access to Market prices & Liquidity
- Technical & Fundamental tools to all levels
- Multiple trading orders for higher flexibility
- Robust security and high stability
- Automated trading option for expert
- 0.01% Technical glitches
- Instant Price execution
- Accessible all round the globe with as less as 10kbps internet speed
- Limit order system
- Amazing tools for technical Analysis
 2. What is Base/Quote currencies

• Whenever you have an open position in forex trading, you are exchanging one currency for
another.  Currencies are quoted in relation to other currencies.

• “buy EUR, sell USD.”

• You would buy the pair if you believe the base currency will appreciate (gain value) relative to
the quote currency.
 3. What is BID price/Ask Price/Spread/Pip/Pipettes

- All forex quotes are quoted with two prices: the bid and ask. In general, the bid is lower
than the ask price.
- BID is the price where the broker buy and traders sell, and vice versa.
 SPREAD
The difference between the bid and the ask price is known as the SPREAD.
 PIP
- The unit of measurement to express the change in value between two currencies is called a “pip.”
- If EUR/USD moves from 1.1050 to 1.1051, that .0001 USD rise in value is ONE PIP.
- A pip is usually the last decimal place of a price quote.
- Most pairs go out to 4 decimal places, but there are some exceptions like Japanese yen pairs (they go
out to two decimal places).

For example, for EUR/USD, it is 0.0001, and for USD/JPY, it is 0.01.

EUR/USD:1.1052
p
i
p
 PIPETTE
- There are forex brokers that quote currency pairs beyond the standard “4 and 2” decimal places to “5 and 3”
decimal places.
- They are quoting FRACTIONAL PIPS, also called “points” or “pipettes.”
- a “point” or “pipette” or “fractional pip” is equal to a “tenth of a pip “. For instance, if GBP/USD moves from
1.30542 to 1.30543, that .00001 USD move higher is ONE PIPETTE.

GBP/USD: 1.30543

pipette
 4. What are LOT sizes

• Lots are defined in terms of currency units

• Standard Lot- 1,00,000 units
• Mini-10,000 units
• Micro- 1000 units
• Nano- 100 units
• Let’s assume we will be using a 100,000-unit (standard) lot size. We will now recalculate some examples
to see how it affects the pip value.
• USD/JPY at an exchange rate of 119.80: (.01 / 119.80) x 100,000 = $8.34 per pip
• USD/CHF at an exchange rate of 1.4555: (.0001 / 1.4555) x 100,000 = $6.87 per pip
In cases where the U.S. dollar is not quoted first, the formula is slightly different.
• EUR/USD at an exchange rate of 1.1930: (.0001 / 1.1930) X 100,000 = 8.38 x 1.1930 = $9.99734
rounded up will be $10 per pip
• GBP/USD at an exchange rate of 1.8040: (.0001 / 1.8040) x 100,000 = 5.54 x 1.8040 = 9.99416 rounded
up will be $10 per pip.
• Here are examples of pip values for EUR/USD and USD/JPY, depending on lot size.
HOW to BUY/SELL in SPOT Market!
 HOW To set STOP LOSS & TAKE
PROFIT
Take Profit
Stop Loss

BUY/Entry

Sell

Stop Loss

Take profit
What is pending order-BUY stop/ sell Stop, buy limit/sell limit

Limit Order : A limit order is an order placed to either buy below the market or sell above the

market at a certain price.

• “Buy stop” to open a long position at the price higher than the current price

• “Sell stop” to open a short position at the price lower than the current price
• “Buy Limit” to open a long position at the price lower than the current price
• “Sell Limit” to open a short position at the price higher than the current price