Markets & forex — the basics
The vocabulary and mechanics before you touch a chart. 14 lessons.
- 01Start this lessonWhat is forex?Written content
Brief excerpt · Forex (foreign exchange) is the market where currencies are traded. When you buy EUR/USD, you buy euros by selling dollars — always in pairs.
- 02Start this lessonWhy trade forex?Written content
Brief excerpt · Three reasons make forex attractive. First, liquidity: on majors, you can enter and exit without moving price, even with a few hundred thousand euros.
- 03Start this lessonCurrency pairs (majors)Written content
Brief excerpt · Major pairs all include the US dollar. The seven classic majors: EUR/USD, GBP/USD, USD/JPY, USD/CHF, AUD/USD, USD/CAD, NZD/USD.
- 04Start this lessonMinors and exoticsWritten content
Brief excerpt · Minor pairs ("crosses") do not include the USD: EUR/GBP, EUR/JPY, GBP/JPY, AUD/NZD, etc. Wider spreads, lower liquidity, but often more personality than majors.
- 05Start this lessonPip, pipette, pointWritten content
Brief excerpt · A pip is the fourth decimal of a pair’s price (except JPY pairs where it is the second). On EUR/USD = 1.0850, moving to 1.0851 = +1 pip.
- 06Start this lessonLot, mini lot, micro lotWritten content
Brief excerpt · A standard lot = 100,000 units of the base currency. On EUR/USD, 1 lot = €100,000. Too much for most retail traders.
- 07Start this lessonLeverage and marginWritten content
Brief excerpt · Leverage is a broker-provided multiplier. With 30:1 leverage, depositing €1,000 lets you open a €30,000 position. Margin is the slice of your capital "locked" to hold the position.
- 08Start this lessonBid, ask and spreadWritten content
Brief excerpt · The bid is the price at which the market buys from you (so where you sell). The ask (or offer) is where the market sells to you (so where you buy). Bid is always lower than ask.
- 09Start this lessonLong vs shortWritten content
Brief excerpt · Long = buying, betting on a rise. Short = selling, betting on a fall. On forex, short-selling needs no authorisation: the pair mechanics let you short as easily as long.
- 10Start this lessonComputing P&LWritten content
Brief excerpt · P&L = (Exit price − Entry price) × Size × Pip value. For a long: profit if exit > entry. For a short: profit if exit < entry.
- 11Start this lessonBase vs quote currencyWritten content
Brief excerpt · In a pair X/Y, X is the base currency, Y the quote currency. The price shows how many Y equal 1 X. EUR/USD = 1.0850 ⇒ €1 = $1.0850.
- 12Start this lessonMarket participantsWritten content
Brief excerpt · Five big categories drive forex. Central banks (FED, ECB) set rates and intervene rarely but heavily. Commercial banks handle most volume — the interbank market.
- 13Start this lessonDrill: compute 5 P&LsWritten content
Brief excerpt · Hands-on drill: turn five moves into P&L. Work each one out by hand before peeking at the answer — the gesture is what locks the mechanic in.
- 14Start this lessonBasics checkpointWritten content
Brief excerpt · Checkpoint for the "basics" track. Three things to lock in before moving on: vocabulary (pip, lot, leverage, spread), mechanics (long/short, P&L computation), and guardrails (why max leverage is rarely a good idea).