How do prices work in currency trading?
In this article we will endeavor to teach beginners to currency trading. In pre-trading (or currency trading), you will see that both the “bid” and “demand” prices are specific.
The tender price is the price at which you can buy the currency.
The price is the price at which you can sell the currency.
To clarify business processes:
If you’re buying a currency in a business, your wish is that the pair increase value, so you can sell it at a higher price and make a profit on the difference.
If you sell a currency in commodity circulation, the opposite is true – the hope is that the currency will depreciate, so that you can buy it again at a lower price, which means that you will gain from the difference.
The FX number is based on the current market exchange rate, or the amount of second currency you will get for one unit of first currency (for example, if the quoted price for euro/dollar is 1.68, you can replace one euro with $1.68 for an interview).
Source: Treng View
How much fluid are the two legs in the fluid trade?
If the way traders make a profit is to exploit the difference between the bid and the price of a currency pair, the next logical question is how much can you expect the movements of a particular currency?
This depends on how liquid a currency is, or how much is bought and sold at a given time. The most fluid X pairs are those with the highest supply and demand in the precursor trade market, and this supply and demand is created by banks, firms, importers, exporters and traders.
The main currency pairs are often the most liquid, and the euro/dollar moves at a rate of 90 to 120 pennies per day.
By contrast, the SAFE/SAFE transfers 50-60 pesos a day, while the US Investment Agency transfers an average of only 32 pesos a day (when we look at the value of currency pairs, most of these points will be listed at five decimal points.
The PIP value is 0.0001, so if the EUR/USD goes from 1.16667 to 1.16677, the 1 PIP will be changed. The main spouses tend to be the most liquid and thus provide the largest short-term business opportunities.
But there are many opportunities between small and strange coins as well, especially if you have some specialized knowledge of a particular coin.