When speaking about the prices of the currencies, we have already mentioned that they are called rates. Anyway, it is very important to mention that in Forex every quotation has two prices- Bid Price and Ask Price. These pairs are usually denoted by a slash “/”, where at front stands the rate of Buy, and after- the rate of Sell, such as USD / JPY 104.75/104.85. The bid price is the price at which the broker is ready to buy the base currency for the quote one, while the ask price is the price at which the company is selling the base currency for the quote one. So it can be understood that the concepts of buying and selling in relation to you are actually “reversed.” Buying and selling in this formulation is not performed by you, but by the party offering you a quotation. More precisely saying, if you need to buy a base currency, you can do it by Ask price, while selling, you need to do it through Bid price.
Buy/Sell Currencies = Long/Short
Before opening any position, every trader has to determine
whether to open a BUY or SELL position. If you want to buy
the base currency and sell the quoted currency, this means
that you are expecting the base currency to rise so as to sell
it back at higher price. Such positions are used to be known
as Long positions. In contrast, if you want to sell the base
currency for buying a quote currency, this means that you
want the base currency to fall in price so as to buy it at a lower
price. Such positions are known to be as Short positions.
So, keep in mind, that Buy=Long and Sell=Short.
When speaking about the prices of the currencies, we have already mentioned that they are called rates. Anyway, it is very important to mention that in Forex every quotation has two prices- Bid Price and Ask Price. These pairs are usually denoted by a slash “/”, where at front stands the rate of Buy, and after- the rate of Sell, such as USD / JPY 104.75/104.85. The bid price is the price at which the broker is ready to buy the base currency for the quote one, while the ask price is the price at which the company is selling the base currency for the quote one. So it can be understood that the concepts of buying and selling in relation to you are actually “reversed.” Buying and selling in this formulation is not performed by you, but by the party offering you a quotation. More precisely saying, if you need to buy a base currency, you can do it by Ask price, while selling, you need to do it through Bid price.
When speaking about the prices of the currencies, we have already mentioned that they are called rates. Anyway, it is very important to mention that in Forex every quotation has two prices- Bid Price and Ask Price. These pairs are usually denoted by a slash “/”, where at front stands the rate of Buy, and after- the rate of Sell, such as USD / JPY 104.75/104.85. The bid price is the price at which the broker is ready to buy the base currency for the quote one, while the ask price is the price at which the company is selling the base currency for the quote one. So it can be understood that the concepts of buying and selling in relation to you are actually “reversed.” Buying and selling in this formulation is not performed by you, but by the party offering you a quotation. More precisely saying, if you need to buy a base currency, you can do it by Ask price, while selling, you need to do it through Bid price.
