Forex Brokers Trading Volume for Major Pairs
Currency pairs with the highest volume tend to have better volatility and liquidity, making them the standard in managing various trading strategies. But if we take a look at each broker, which one has the best volume for EUR/USD, GBP/USD, and USD/JPY trading?
How to plan an exit scalping strategy with volume indicator?
We can target 10-20 pips profit and 5-8 pips loss. The following picture explains the scenario of opening a long position around the upper range with a 12-pip profit target and a 5-pip stop loss level.
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How does volume indicator indicate the end of a trend?
See how prices fall after a volume spike in the picture above? Let's say we are in an auction where bids for an antique painting have reached its topmost price level, what will happen then? Most likely, no one will bid again. The same can be said in the forex market. When a certain price is already considered too high, many people will stop buying; instead, there will be many people who get out of the market or try to cash in their profits. Thus, it can be concluded that after a substantial jump in volume, the previous trend will end. Afterward, what's left is for prices to consolidate at a fundamentally-sound level.
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Why is volume indicator not favored in forex trading?
While the use of volume indicator is crucial in stock analysis, the same thing can't be said when it comes to the forex market. The absence of "central exchange" in the foreign exchange market has made it difficult to measure the actual volume. Measurement by any indicator is believed to be interpreting a certain part of the market, so it can never represent the traded volume of the whole forex market.
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How are cent account trading volumes compared to the standard one?
With a cent account, you have access to a minimum trading volume of 0.01 lots which is equivalent to 0.0001 lots or $10. For a standard account, this minimum trading volume of 0.01 lots would be equivalent to $1000.
- Cent Account:
- Minimum trading volume: 0.01 lots
- Value per lot: $0.0001 (or equivalent to 0.01 lots)
- Therefore, the minimum trading volume value in dollars: 0.01 lots * $0.0001/lot = $0.0001
- Standard Account:
- Minimum trading volume: 0.01 lots
- Value per lot: $100 (or equivalent to 0.01 lots)
- Therefore, the minimum trading volume value in dollars: 0.01 lots * $100/lot = $1
Continue Reading at How Does a Cent Account Work?
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