The Currency Shorting Guide
Currency Shorting Guide is a valuable tool for traders who believe that a country’s currency will decline in value relative to another. But, like all trading strategies, shorting comes with its own unique set of risks that must be understood and managed carefully. With the right preparation, knowledge, and discipline, however, this strategy can become a significant component of your trading approach.
To trade a currency pair you must first identify the currency you wish to short and open a sell position on your trading platform. Then you will need to select a counter currency to ‘buy’ with the base currency that you are selling. For example, if you were shorting GBP/USD and believed that the pound would fall against the US dollar then you could open a sell position on your platform by entering a price quote of 1.22075.
Currency Shorting Guide: Strategies for Success
In this scenario, you would be selling 10,000 euros in exchange for USD – which means that you expect the value of your euro’s to fall against the USD and make a profit as a result.
To execute a successful short sale you must carry out thorough research and analysis of both technical and fundamental factors. This includes looking at economic indicators, interest rates, geopolitics, and central bank policy. In addition, you will need to use risk management tools such as stop-loss orders and limit orders to reduce your exposure and ensure your capital is protected.…