Forex trading involves buying one currency while selling another. Prices are quoted as currency pairs such as EURUSD, GBPUSD and USDJPY.

IMAGE PLACEHOLDERForex Trading Basics
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Pips, Spreads and Lots

A pip is a common unit of price movement. The spread is the difference between bid and ask prices. Lot size determines the amount of exposure taken on each trade.

Leverage

Leverage allows a trader to control a larger position with less capital, but it also magnifies losses. Understanding leverage is essential before trading or using managed forex accounts.

Risk Comes First

Beginners should focus on position sizing, stop-loss planning and drawdown before focusing on profit targets.