Original subtitles

the unit for measuring the change in value between two

is going to be the foundation of your risk management. So

second decimal place. Some brokers now quote currency

later on you're going to learn the advanced concepts of risk

and then the minor pairs are sometimes referred to as the

management with an entire module dedicated to just this

is equal to one 10th of a pip and you must must develop a

strong understanding of pips and how to measure them as this

however, so this is why they are quoted against each other

known as pipettes or micro pips and they are equal to a 10th of

focus probably just on these USD pairs alone because they

swipe and attack with their their heads and the horns

value because bears swipe down with their paws right pips are

Individual currencies don't have an absolute value,

and we put them in pairs. So, we pair these eight currencies

places so in that case one pip is equal to 0. 01 right so you

currencies which are usually the fourth decimal place but

pairs to five decimal places for added precision where the

there are some exceptions like the Japanese where a pip is the

pairs and three on the Japanese yen pairs to give us that extra

so one pip equals not. 0001 now gets a little bit tricky

if your dollar was then quoted at one spot 10357 that would be

key points we have covered in this lesson, we focus on the

pip quiz if you're a dollar rises from 1. 1035 to 1. 1040

crosses and they are all of the remaining pairs out of those 28

into every combination possible which makes 28 tradable

short and if we you know say we are bearish on a particular

the yen pairs really that do that so let's do a quick little

yen, the Great British pound, the Canadian dollar, the Swiss

value relative to the quote currency the dollar right so in

likely find that you will spend the majority of your time and

okay so pips they stand for percentage in point and they

Frank, the Australian dollar, and the New Zealand dollar.

So, Euro dollar or Aussie dollar for example and you will

ideally buy back at a later date at a much lower price to

then lock in that profit and we will short pound dollar if we

are referred to as fractional pips which are more commonly

upwards right and if we sell something we say we are going

and they now actually go to five decimal places on most

position and you can make money when the market falls so in

smaller number that is the pipette right and which in this

Now, most Forex brokers, they quote currency pairs beyond the

buy something we say we are going long or taking a long

standard four and two decimal places that we just looked at

asset then we think that it is going to fall and depreciate in

is that? Yep, it's a fifteen pip rise because remember,

rises from 140. 90 to 141 spot zero five what movement in Pips

provide extremely reliable and frequent trading opportunities

position and if we say we are bullish then we think that that

fifth decimal place is called a pipette or micro pip and this

case that would be equal to nought point two pips and then

of the amount that the price changes so when reading a price

asset is going to go up in value so remember bulls they

down to 1. 1005 then that indicates what a 30 pip fall

plans. The major pairs are the pairs which contain US dollar.

that do not contain the US dollar. Yeah in training if we

depending on your trading style but like I said, excuse me,

you want to write that down and the correct answer is five pips

that case we make sure that we are selling high and then

yes you are correct hopefully alright last one if pound yen

okay pretty simple let's do another one if Euro dollar

rises from sorry if Euro dollar falls from 1. 1035 all the way

program when you start to build out your own personal training

quote currency at the same time. So in simple terms if you

how many pips has that gone up by so pause the video now if

long or taking a long position and ideally we want to be

strategy that you're going to learn, you will only need to

can see the the the subtle difference there but it's just

3035 US dollars at that point in time so if you have some US

we'll talk a lot more about this at a later point in the

expect the pound to weaken against the US dollar okay pips

currency pair is referred to as going short or taking a short

focus on just one pair alone or potentially a few pairs

currency pairs but as I was saying earlier, with this

added precision in quoting those exchange rates and these

dollars and you want to buy some pounds with them you would

quote a pip is usually the fourth and last decimal place

go long this simply means that you are buying the base

selling dollars. So you would buy the pair if you believe

appreciate and gain value relative to the quote currency

the US dollar and you would sell the pair and go short if

that you narrow your focus onto just one or even a few pairs

purchase just one pound so the base currency on the left in

would buy the pair if you believe that the pound would

an increase of half a pip So, just to quickly summarize the

price for a profit so in that case we expect the pound to

strengthen against the US dollar and in selling a

buying low and then selling back to the market at a higher

fifth decimal place which is usually visually displayed as a

or the other way round let's say that you have some pounds

3035 US dollars for every pound that you then sell Now remember

focus on are Euro dollar, pound dollar, Aussie dollar, and

currency and you are simultaneously selling the

literally a daily basis on even just one currency pair alone.

So when pairs are quoted the currency on the left hand side

what this essentially means is that one pound is equal to 1.

eight major currencies, the US dollar, the Euro, the Japanese

and really spend time mastering those. Now, we're going to

one so for the example if pound dollar is quoted as 1. 3035

you think the base currency the pound will depreciate and lose

when you're trading if you buy the currency pair pound and you

that the base currency so the the Great British pound you

So, if you want extraordinary results, it is highly advised

rate this indicates how many great British pounds can

pound yen but yeah, don't worry too much about that just now.

have to pay 1. 3035 US dollars for every pound that you want

that you want to buy dollars with then you would receive 1.

some of the main pairs that most traders in our community

a pip. So if your dollar was quoted at 1. 10352, then the

the right is called the quote currency so the pound exchange

upgraded the old cable to a state of the art fiber optic

Japanese gen pairs, they only go out to two decimal places.

and Dollar Yin as Ninja Now, with the photon strategy, you

line hence the ingenious name fiber then we have Kiwi Dollar

times, an overwhelming abundance of opportunity on

fiber optics, the exchange rate between the Great British pound

what essentially traders referred to as but then when

Sterling and the US dollar, it was actually transmitted across

nineteenth century, before the invention of satellites and

trades in the later lessons now paired up in every possible

the Atlantic Ocean via a submarine cable. So, this is

dollar, they are commonly known as minors or crosses. Now You

may hear many of the major pairs referred to by traders

we're going to cover specific instructions on executing

deliver a total of 28 tradable currency pairs and of these 28

broker will take care of this, you know, the simultaneous

pairs those that contain the US those are referred to as the

will literally either just click buy or sell on the pair

majors. And the remaining pairs that do not contain the US

go along pound dollar you are buying pounds and you are

trade of talk buying a currency pair is referred to as going

referred to as cable and this is because back in the mid

dollar, a simply Aussie, pretty simple, pound dollar is often

if that can be a little bit confusing, fortunately, your

with certain nicknames. Australian dollar versus the US

probably when some of you were actually born traders simply

instrument just like a so on your execution software you

as a whole so they make it super simple for you now don't

buying and selling at the same time, they take care of that so

Aussie dollar, you would be selling Australian dollars

combination the major eight individual currencies they

and when bears attack, they swipe downwards with their

Aussie dollar you would be buying Australian dollars while

because there are some exceptions to the rule like the

simultaneously selling US dollars so this means that you

short and you would say that you are bearish on a pair if

currencies so essentially pips are what we refer to in terms

new to trading it can be a little bit confusing if it's

would profit from how much the Australian dollar appreciates

Japanese gen pairs because they only go out to two decimal

so it goes up in value in comparison to the US dollar and

simply as Kiwi Dollar Cad as Looney Dollar Swiss as Swissy

are the unit for measuring the change in value between the two

together just on its own there's no way of putting a

discuss this in much much more depth in a later module in the

purchase one US dollar or how many US dollars you need to

were to buy the Aussie dollar in trader talk you would say

relative value of a currency unit against the unit of

if you were to sell the pair this means that you are going

that you are going along the Aussie dollar. And another term

you think it is going up. So when you buy currency pair

are a trader is bullish. So you say that you are bullish on a

which is commonly referred to as Aussie dollar. So if you

another currency at any given time so therefore always quoted

that you can value them is you have to compare them to that of

cost and those low volume exotic pairs now an individual

currency it does not have an absolute value so the only way

in pairs a currency pair is simply the quotation of the

liquidity which is vital when you need to exit a trade. There

is always called the base currency and the currency on

the Euro was introduced not too long ago in the late 1990s,

price on it essentially so An example of a pair would be AUD

currency pair or whatever asset class you are talking about if

course when you start to put your trading plan together but

will find that there is literally an overwhelming at

another currency right you always have to pair them

bat. Now, I would strongly advise that you stick to the

paws, alright? But anyway, if you were to sell the pair,

right? So, as a currency trader, you may be presented

New Zealand and the D stands for the dollar. Pretty simple,

that you can simply focus on the pair as a single training

worry if it seems a little bit confusing at this point because

definitely not least, the New Zealand dollar. Now, currency

highest trading volume in the FX market and high volume means

with the opportunity to trade more obscure exotic currencies

symbols, they always have three letters where the first two

third letter represents the name of the currency. So, take

while simultaneously buying US dollars with them, right? Now,

the first time you've heard some of these terms so an easy

management process. So, as a Forex trader, the first thing

is currency. Now why there are lots of currencies that you can

that when bulls attack they swipe upwards with their horns

dollar, the Canadian dollar, the Swiss Frank, and last but

way to remember the difference between bullish and bearish is

the Japanese yen, the Great British pound, the Australian

this case the pound no matter what it always has a value of

currencies of the world. The United States dollar the Euro,

you'll need to learn about is your product, right? And that

In this lesson, we are going to cover what currency pairs are,

which of the many currency pairs do we actually choose to

measure them, because this is a vital part of the risk

trade and focus on, how to read a forex quote, and then we're

that will become a common part of your vocabulary now that you

the New Zealand dollar for example, NZD, the NZ stands for

you think it is going down now I know you're probably a bit

versus USD. So the Australian dollar versus the US dollar

is simply no to risk a capital taking a position on those high

going to finish off by looking at what pips are and how we

people are trading those currencies leading to higher

one topic alone. I

that transaction costs are generally lower and the more

major eight listed here as these currencies have the

such as the South African Rand, the Mexican Peso of the Thai

identified the country and most of the time but not always, the

trade? Most active traders focus on the eight major