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    ell to make the purchase. This principle gives rise to two important trading terms - the long position and the short position.

    A trader is said to

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    An FX trade can be a little confusing for the newcomer to the world of foreign currency trading but is fairly easy to understand once you break it down into its component parts and learn one or two of the basic trading terms.

    The objective in any FX trade is to exchange one currency for another in the belief that the market will move and prices change so that the currency which you have bought will rise in value relative to the currency which you have sold.

    A very important point to note here is that every trade involves two currencies - the currency that you buy and the currency that you sell to make the purchase. This principle gives rise to two important trading terms - the long position and the short position.

    A trader is said to

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    into its component parts and learn one or two of the basic trading terms.

    The objective in any FX trade is to exchange one currency for another in the belief that the market will move and prices change so that the currency which you have bought will rise in value relative to the currency which you have sold.

    A very important point to note here is that every trade involves two currencies - the currency that you buy and the currency that you sell to make the purchase. This principle gives rise to two important trading terms - the long position and the short position.

    A trader is said to

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    the belief that the market will move and prices change so that the currency which you have bought will rise in value relative to the currency which you have sold.

    A very important point to note here is that every trade involves two currencies - the currency that you buy and the currency that you sell to make the purchase. This principle gives rise to two important trading terms - the long position and the short position.

    A trader is said to

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    have sold.

    A very important point to note here is that every trade involves two currencies - the currency that you buy and the currency that you sell to make the purchase. This principle gives rise to two important trading terms - the long position and the short position.

    A trader is said to

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    ell to make the purchase. This principle gives rise to two important trading terms - the long position and the short position.

    A trader is said to take a long position when he buys a currency in the expectation that he will able to sell it later at a profit. To realize a profit the trader must of course sell the currency once it has risen in price.

    When a trader sells a currency in the expectation that it will fall in value he is said to take a short position and his intention is to buy the currency back again once the price has dropped. The trader will only profit from a fall in the price once he buys the currency back.

    As in any pair of currencies a rise in one currency will always be balanced by a fall in the other, it follows that

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