89. Forex Trading - Understanding the Bid/Ask Spread

http://clk.atdmt.com/FXM/go/nfrsieng0100000402fxm/direct/01/
A lesson on the two way quote in forex trading referred to as the bid ask spread and what this means to us as traders of the forex market.

Category:

Howto & Style

Tags:

• forex
• forextrading
• currency
• trading
• demo
• fx
• daytrading
• day
• trade
• central
• bank
• stockmarket
• investing
• finance
• money

[swingkid]

If the Euro strengthens with respect to the USD, then the pair would go up, so I think we would place an order to go long the pair.

[InformedTrades]

Hey Swingkid, Glad to hear from you and yes that is correct. Best Regards, Dave

[idiot68]

i heard forex is a good way to make money fast(with the leverage and what not) but a greater way to lose money fast.lol. what say you?

[InformedTrades]

It is a fact that most traders lose money so I would agree that its easier to lose money fast trading than it is to make money fast. Best Regards, Dave

[mmikhaiel]

Hi,

Do you think there is a correlation between the US stock market trading and the Forex trading?

[InformedTrades]

Hi mmikhaiel, Thanks for the comment. In short yes I do think there is some correlation between the US stock market the US Dollar and certain other currencies such as the Japanese Yen. For a more in depth explanation of why I have a bunch of free videos on what moves the forex market in my free forex trading course over at InformedTrades. Best Regards, Dave

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[TheDjbang]

The difference between the bid and the ask is called the "Spread". This is the amount that Metatrader charges you per trade. That is why bid and ask prices will never equal each other, it's how they make money from you trading with them. If their "spread" varies during your trade it means that they're fees are changing while you watch, very bad every time the spread increases. That's one reason why David promotes FXCM trading platform, because their Spreads are more stable.

[ichersue]

hence as david said in the video bid is sell price while ask is buy price. surely no one will be willing to sell at a price lower than or equal to the buying price, therefore bid = ask or ask > bid is indeed practically impossible

[ichersue]

example of what?

[TheDjbang]

Give an example in $ terms pls.