LONG AND SHORT TRADES - TEXT VERSION

LONG AND SHORT TRADES - TEXT VERSION

In a previous lesson, we have a tendency to mentioned that once commercialism in Forex we have a tendency to try and shop the terms - i.e. value} price, and sell at resistance - i.e. the complete or selling price. 

The whole purpose of basic technical analysis (TA) is to search out these doubtless low and high costs for a given amount. They become our low-risk entry points and high-yield exit points.

Whether we have a tendency to enter at the anticipated low value or the high value for a given currency try depends on whether or not or not we have a tendency to create a shot at short selling/long position commercialism. 

For those not conversant in the terms short selling/long position or going long/going short, let’s outline these terms:

GOING LONG

You take a “long position” otherwise you “go long” once you decide to purchase low and sell high, even as with most business transactions outside of economic markets like forex. as an example, retailers purchase merchandise at a less expensive wholesale value, so sell them at a better retail value. this is often going long.

GOING SHORT

You take a “short position” or “go short” once you sell one thing at a given value, with the intention of delivering it at a later date once you’re able to decease at a lower cost and profit on the distinction. If at that later date you would like to pay a better value, then you lose cash on the trade. this might be thought of going short.

Definitions of s/r ar reversed for long or short trades. once you ar shopping for (or going long) a currency try, the definition of support and resistance is that the same as in the other reasonably business and so straightforward to understand: