Why is the buy and sell price difference in forex

Why is the buy and sell price difference in forex

If successful, selling near a market’s top or buying near the bottom will be profitable as price rejects the extreme and revisits an average level. Ultimately, each of the above strategy types can be effective ways of determining when to buy and sell forex blogger.comted Reading Time: 6 mins When a price for a market is quoted, you will actually see two prices. The first price, known as the bid, is the sell price and the second price is the buy price, known as the offer. The difference between the sell and buy price is called the spread 3/2/ · The buy price is higher than the sell price, but the fact that the charts usually only show the sell side price can be the cause of confusion for traders who are not aware of this. One of the Estimated Reading Time: 1 min

Buying and Selling in the Forex Market

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See our updated Privacy Policy here. Note: Low and High figures are for the trading day. The buy price is higher than the sell price, but the fact that the charts usually only show the sell side price can be the cause of confusion for traders who are not aware of this. One of the advantages of using the MarketScope charting package that comes with the FX Trading Station II is that you have access to both prices.

You will notice that there is a choice of whether to choose "B" or "A". The "B" stands for Bid, which is the price at which you can sell this pair. Many traders who sold this pair earlier and placed their protective buy stop at 1. When logging back into their FX Trading Station II, they are surprised to find out that they were indeed stopped out of their trade, and at a price higher than the high shown on this chart.

This second chart explains why. This chart shows the same time period of the same pair and notes the same candle. The difference is that I clicked on the "A" which means that the chart will show the buy side prices.

Remember that if you sell to open your trade, you will buy to close it. We can see that the buy side high of this same candle was 1. The difference between the sell side price and the buy side price is of course, the spread. So whenever you are buying with the use of an entry order or exiting with a buy stop order or a buy limit order, remember to use the buy side prices on your chart. There are not many charting packages which give you this option, but the free MarketScope charting package does, which shows just how valuable these charts can be for traders at FXCM.

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Bid / Ask Spread - Trading Terms

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Why are 'buy' and 'sell' prices different?

If successful, selling near a market’s top or buying near the bottom will be profitable as price rejects the extreme and revisits an average level. Ultimately, each of the above strategy types can be effective ways of determining when to buy and sell forex blogger.comted Reading Time: 6 mins 2/4/ · Knowing when to buy and sell forex depends on many factors, but there tends to be more volume when markets are volatile because of the associated higher blogger.comted Reading Time: 4 mins 3/11/ · A: The difference in the two prices you’re referring to is the “spread,” and it represents the commission that is paid to the broker who executes your trade. In Estimated Reading Time: 2 mins