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LEARNTO TRADEBuild Your Successful Trading Strategy eBOOK

CONTENT 1. About the FX Market What is the FX Market? History of the FX Market What is special about the FX Market? FX Facts Today 2. How to Trade FX About the currency pair Currency abbreviations Majors, minors, exotics What is Leverage? 3. Placing A Trade Pips, Ticks & Spreads Contract Sizes Order Types Slippage How to place a trade 4. Your Trading Strategy Fundamental factors affecting FX trading Technical factors affecting FX prices How to make your trading strategyTrading Tools to complement your strategy 5. The Importance Of Safety 6. Opening An Account

About theFX market• What is the FX Market?• History of the FX Market• What is special about the FX Market?• FX Facts Today

What is the FXmarket?The FX market is the largest and most dynamicmarket in the world.The foreign exchange market (forex, FX,or currency market) is a globaldecentralised market for the trading ofcurrencies.Forex is an “over-the-counter” (OTC) marketsupported by forex dealers serving as market-makers.

Historyof themarketThe first evidence of moneyexchange is referenced in Talmudicwritings, where people wouldchange money, whilst taking acommission for themselves.1472The world’s first bank, Monde DeiPaschi di Siena was founded inTuscany.1875The Gold Standard was introduced.This is one of the most importantevents in the history of forex, andwas a commitment to fix the valueof a currency to a specific quantityof gold.

1950The Eurodollar market was established asthe Soviet Union deposited much of its oilrevenue outside the US in order to avoidthe control of the US authorities.1971US President Richard Nixon eliminatedthe Gold Standard to combat highinflation levels, which led to free-floatingcurrency exchange rates.1980London became the centre of theEurodollar market when British bankslent dollars as an alternative to poundsin order to maintain their position in theglobal financial markets.1996Increasing popularity of the internet.Until this time, currency trading wasalmost exclusive to large companies whoconducted business internationally.PRESENT DAYThere are now more than 19.3 millionretail FX traders worldwide operatingthrough more than 700 forex brokerages.

What is specialabout the FXmarket?• Retail traders from anywhere in the world can trade with simply an internet connection and a mobile device.• Advances in technology create fast connectivity and low latency.• There is an ever increasing range of wide range of tradable instruments including commodities, indice and digital currencies.• Low transaction costs in FX trading.• Extremely high market liquidity.• Low barriers to entry.• FX is not correlated with other asset classes, and can help diversify a portfolio.

• The ability trade on a large investment with a small amount of margin, with leverage.• FX is extremely difficult to manipulate because of the large size of the market size.• The forex market doesn’t sleep. It operates 24 hours a day, five days per week.• It is the world’s largest market, which means that there is always somebody on the other end of your trades.• It is decentralised, meaning that there is not one government, institution or central bank controlling it.• There is always something going up and down unlike other markets where everything moves together.

FX facts todayAs of 2016, $5.1 trillion are traded on the FX markets,dailyTrading on the FX market begins when the market inSydney opens at 22:00 GMT on Sunday, the markets inNew York close at 22:00 GMT Friday (New York).60% of all Forex transactions are conducted in eitherthe UK (41%) or the United States (19%).U.S. Dollar accounts for over 87% of the total volume ofFX traded dailyEUR is the second most popular currency traded daily,at 33.4%Forex trading daily volume is 4 times global GDP.

How totrade FX• About the currency pair• Currency Abbreviations• Majors, Minors, Exotics• How FX is quoted• When To Trade• What is Leverage?

About thecurrency pairThe forex pair consists of two prices:The Bid and the Ask. The spread is the differencebetween these two prices. BID ASK SELL BUYIn a currency pair, the bid is on the left and the offer,or the ask, is on the right.Bid is the price at which you can sell the base currency,and the offer is the price at which you can buy the basecurrency.So, for example is USD/JPY is 105, it means that it takes105 Yen (the quote currency) to buy one dollar (the basecurrency).

CurrencyAbbreviationsThe International Organisation for Standardisation (ISO) hasdetermined standard abbreviations for currencies. Usually thefirst two letters refer to the country, and the third refers to thecurrency.MAJOR CURRENCIES MINOR / EXOTIC CURRENCIESUS Dollar USD Swedish Krona USDEuro EUR Norwegian Krone NOKJapanese Yen JPY Korean Won KRWGreat Britain Pound GBP Singapore Dollar SGDAustralian Dollar AUD Hungarian Forint HUFSwiss Franc CHF Polish Zloty PLNCanadian Dollar CAD Mexican Peso MXNNew Zealand Dollar NZD Russian Ruble RUB

Majors, Minors,ExoticsMajor Currency PairsThe currencies that trade the most volume against the U.S. dollarare referred to as the major currencies. All of the major currencypairs have very liquid markets that trade 24 hours a day everybusiness day, and they have very narrow spreads.Examples include:EUR/USD, GBP/USD, USD/JPY, USD/CHF, AUD/USD, USD/CAD.Minor Currency PairsCurrency pairs that are not associated with the U.S. dollar arereferred to as minor currencies or crosses. These pairs haveslightly wider spreads and are not as liquid as the majors.Examples include:EUR/GBP, GBP/JPY, EUR/CHF.Exotic Currency PairsExotic currencies pairs include currencies of emerging markets.These pairs are not as liquid, and the spreads are much wider.Examples include: USD/SGD

CURRENCY PAIR CODE HIGHER =Dollar & Euro EUR/USD EUR stronger, USD weakerDollar & Yen USD/JPY USD stronger, JPY weakerDollar & British Pound GBP/USD GBP stronger, USD weakerEuro & Pound EUR/GBP EUR stronger, GBP weakerUS Dollar & Australian Dollar AUD/USD AUD stronger, USD weakerAustralian Dollar & NZ Dollar AUD/NZD AUD stronger, NZD weakerUS Dollar & Canadian Dollar USD/CAD USD stronger, CAD weakerUS Dollar & Swiss Franc USD/CHF USD stronger, CHF weakerEuro & Swiss Franc EUR/CHF EUR stronger, CHF weaker

When to tradeIt is open 24 hours per day and 5 days per week. This isbecause, as the trading hours for one region ends, thenext region’s market day begins. The main trading centersare in London, New York, Sydney and Tokyo, and the mostexciting times to trade can be when the sessions overlap.This is because high volumes are being traded, and maxi-mium volatility presents trading opportunities.

What is leverageSimply put, leverage allows traders to trade on a large invest-ment size, without having to put up the full amount.This means that a small account balance can control a muchlarger total contract value. 1 : 100 Your What the brokerdeposit size will invest for youFor example where leverage is 1:100, it means that for every $1invested in the market, the broker invests $100 for you. So, witha deposit of just $100, the trader can access $10,000.Leverage makes a trader with a small investment size have thesame potential as a trader with a much bigger investment size.

Placing a trade• Pips, Ticks & Spreads• Contract Sizes• Order Types• Slippage• How to place a trade

Pips, ticksand spreads• One pip is the value of the number four places after the decimal point.• One tick is the minimum number of pips that a currency pair moves• The spread is the number of pips between the bid and the offer

ContractSizesThe contract size is the trading amount orquantity for exchanging currencies.The common lot sizes are:Standard Lot = 100,000 unitsMini Lot = 10,000 unitsMicro lot = 1,000 units

Order typesMarket OrderA market order is an order to buy or sell at thebest available price.Limit Entry OrderThis is an order placed to buy below the market orsell above the market at a certain price.Stop Entry OrderThis is placed to buy above the market or sell be-low the market at a certain price.Stop Loss OrderThis is linked to a trade for the purpose of pre-venting additional losses. The stop loss orderstays in effect until the position is closed or untilthe order is cancelled.

Trailing StopThis is a type of stop loss order attached to atrade that moves as price fluctuates. Your positionwill be closed when a market order to close yourposition at the best available price is sent.Good For the DayA GFD order stays active in the market until theend of the trading day.Once Cancels the OtherA OCO order is a mixture of two entry and or stoploss orders.One Triggers the OtherAn OTO is the opposite of an OCO as it only putsan order when the parent order is triggered.

SlippageSlippage is a normal market condition that occursat times of limited liquidity or at times of particu-larly high market liquidity, for instance when anyimportant economic data are about to be releasedor at the market closing and / or opening times.

How toplacea trade1) Identify the pair that you want to buy2) Decide on the size of the contract3) Apply Stop Loss or Take Profit limits4) Open the trade

Your tradingstrategy• Fundamental factors affecting FX Trading• Technical factors affecting FX prices• How to make your trading strategy• Trading Tools to complement your strategy

Fundamentalfactors affectingfx tradingFundamental Analysis concentrates on the finan-cial drivers of the economyIt attempts to identify intrinsic value by examiningrelated economic, financial and other factors relat-ed to the markets.What to look for in fundamental analysisExchange RatesBalance of PaymentsCentral bank interventionInterest ratesNational monetary policyInflationNatural resources of a countryGrowth rates of a countryFiscal Policy

AccessingfundamentalanalysisTraders of FXPRIMUS are offered a daily funda-mental analysis direct to their inbox.Our daily digest is written by market professionalswith over 30 years experience researching themarkets, and contains the most important infor-mation to help you with your trading strategy.Visit FXPRIMUS.com/education to access ourworld class resources

Technical factorsaffecting fx pricesTechnical Analysis focuses on past price behavioursIt involves the study of charts to identify patterns and trendsThe field of technical analysis is based on three assumptions:1) The market discounts everything2) Price moves in trends3) History tends to repeat itselfWhat to look out for in technical analysis:Trends Upward TrendlinesDownward Trendlines Sideways TrendsLine Charts Resistance LinesSupport Lines Channel LinesBar Charts Reversal PatternsCandlestick Charts Double TopsDouble Bottoms Head & ShouldersMoving Averages

Types of chartsType of chart About the chart BenefitsLine Chart Line charts help illustrate This chart is helpfulBar Chart supply and demand by for understanding the mapping time on the X-axis major movements and price on the Y-axis. The only. most simple of all charts is Bar charts are very use- the line chart which con- ful to draw trend lines. nects a timescale’s closing This tyoe of chart can prices without giving us also detect short term any information about the breakouts. trading range during the selected time interval. The top of the vertical line indicates the highest price a security traded at during the day, and the bottom represents the lowest price. The closing is displayed on the right side of the bar, and the opening price is shown on the left side of the bar.Candlestick Chart Its is a combination of a Candlestick charts line-chart and a bar-chart. are visually superior It records four prices open, to bar charts, and are close, high and low. If the preferred by traders, close price is higher than because their coloured the open real body is white bodies help to identify and if the close is lower trend, support-resis- than the open real body is tance and trend lines black. and buy/sell signals.

Support &ResistanceThe troughs, or reaction lows, are called support. Support is alevel or area on the chart where buying interest is sufficient-ly strong to overcome selling pressure. Decline is halted andprices turn back up again.Resistance is the opposite of support and represents whenselling pressure overcomes buying pressure and a price ad-vance is turned back. Resistance Line Support Line

CandlestickChartsA candlestick chart is a combination of a line-chart and a bar-chart. It records four prices : open, close, high and low.• The area between the open and the close is called the real body and price excursions above and below the real body are called shadows or leg• If the close price is higher than the open real body is white and if the close is lower then the open real body is black• Candlestick charts are visually superior to bar charts, and thus preferred by traders, because their coloured bodies help to identify trend, support-resistance and trend lines and buy/sell signalsHigh High Bullish BearishClose Candle Candle Open High HighOpen CloseLow Low Close Open Open Close Low Low

ChannelsThere are three types of channels in Forex charting: ascendingchannel, descending channel, and horizontal channel.In an ascending channel pattern, the peaks create higher highsand higher lows. In a descending channel pattern, the peakscreate lower highs and lower lows. And, in a horizontal chan-nel pattern, the market is ranging.• Traders buy near the channel bottom and sell near the channel top• Trades take short trade whenever the price touches the upper boundary and take long trade at the lower boundary• You can also use the break out of a channel to find trades

Reversal PatternsReversal patterns indicate that a reversal in trendis taking place.Reversal patterns:1. Existence of prior trend2. First signal of an impending trend reversal is the breaking of an important trendline3. The larger the pattern, the greater the subsequent move4. Topping patterns are usually shorter in duration and more volatile than bottoms5. Bottoms have usually smaller price ranges and take longer to build6. Volume is usually more important on the upsideMost common reversal patterns:• Head and Shoulders• Double tops and bottoms• Triple tops and bottoms• Spike (or V) tops and bottoms• Ascending and Descending Wedge

How to make yoursuccessful tradingstrategyUse stopsDecide in advance which currency pair you wish to trade,along with how much profit or loss you wish to close the tradeat.Keep your emotions in checkIn trading, emotions are our enemies. In order to make surethat our trading decisions arent affected by our emotions, weneed to be disciplined and stick to our trading plans.Manage your moneyEnsure that you have enough capital to withstand any draw-downs. Proper money management will ensure you have thestaying power to remain in the market.

Be realisticIf you aren’t confident trading, start off with a demo accountuntil you familiarise yourself with your trading style and strategy. OPEN DEMOBe patientSuccessful traders need patience to wait for the right time to en-ter or exit a trade. It takes discipline to establish guidelines aboutwhen that trade is.Don’t get greedyStay focused on your trading strategy and don’t be tempted totake extra risks without proper consideration.

Trading ToolsClick to access our tools in order to complementyour trading strategyEducational FX Economic Trading Videos Glossary Calendar CalculatorsVISIT EDUCATION PAGESAlarm Trade Market Mini SentimentManager Connect Terminal Manager Terminal TraderDOWNLOAD TRADING TOOLS

The importanceof safety

Trading can be risky. With this in mind, it is extremely import-ant that you chose to trade with an ethical, regulated brokerwho will strive to protect your investment.Here are the most important ways that your funds can beprotected: 3rd Party Monitoring Segregated Client Fullyfor Client Withdrawals Funds From Company Audited Funds EU Negative Balance Client FundRegulated Protection Insurance up to €2.5 Million

FXPRIMUS.com OPEN AN ACCOUNT HOW TO OPEN AN ACCOUNT Fx Primus Europe (CY) Ltd, trading under the FXPRIMUS trade name, is regulated by CySEC (license no. 261/14) and insured by a EUR2.5M policy.Risk Disclaimer: Please note that forex trading and trading in other leveraged prod-ucts involves a significant level of risk and is not suitable for all investors. Trading in financial instruments may result in losses as well as profits and your losses can begreater than your initial invested capital. Before undertaking any such transactions you should ensure that you fully understand the risks involved and seek indepen- dent advice if necessary. Read our full risk disclosure.FXPRIMUS does not offer its services to the residents of certain jurisdictions such as: USA, Australia, Belgium, North Korea and France. © 2017 FXPRIMUS is the trade name used by FxPrimus Europe (CY) Ltd, Cyprus. All Rights Reserved.