Fundamental properties of tradable commodities
(1)
Liquidity -> commodities can be bought and
sold freely
(2)
Precise rating of quality -> gold bars must
be atleast 99.5% pure gold
(3)
Quantity -> agreed minimum quantity which can
be traded (this is lot)
(4)
Fluctuating price -> response to supply and
demand. These level of supply & demand vary as news reaches from outside
world
Types of exchanges
(1)
Commodity exchanges -> gold, silver, oil,
wheat
(2)
Stock exchanges -> world economic
(3)
Currency exchanges ->
5 currencies ( dollar, euro, pound, yen, swiss franc )
1 Lot = 1 000 000 $
8AM to 6PM (10hrs)
End of trading day = 21:30 GMT
usd/jpy =102 (today in Japan, they give 102 Yen for one
dollar)
base/quote
Margin (or) Leverage -> 1:100 means a $200 deposit works
like $20000
Different brokers offer different levels of leverage
Bid and Ask -> each currency pair has two prices: Bid and
Ask
Bank able to buy cheap and sell more from you.
Spread = Ask – Bid (the profit that banks or brokers make
from each transaction they handle)
TA = a science which means it is governed by clear and rigid
laws
3 ways moving in ( up trend, down trend, sideway or range )
Support -> last local minimum
Resistance-> last local max
Broken resistance level = new support level
Broken support level = new resistance level
To plot a support line on uptrend, connect most visible lows
To plot a resistance line on downtrend, connect most visible
highs
@uptrend, buy at support and sell when support is broken
@downtrend, sell at resistance and buy when resistance is
broken
Price pattern formed within a chart when prices are graphed
Downtrend -> reversal patterns-> uptrend
Uptrend->reversal patterns->downtrend
#source : http://www.fxkeys.com/
#credit to : http://www.fxkeys.com/