Introduction to Trading

WHAT IS TRADING?
 WHAT IS FOREX?

What is Forex? Largest Financial Market

Forex is an acronym for It is the world’s largest
the Foreign Exchange financial market
Market.
conducted over-the-
Component counter (OTC) through
It is a component of electronic trading
financial markets platforms.

Speculating
Financial Market It involves speculating
Financial markets is a in changes in the value
broad term describing of currencies, aiming to
any market place make a profit.
where trading of
securities such as
equities, bonds and
currencies occurs.

Trading in margined products carries high level of risk.

 WHAT ELSE CAN YOU TRADE WITH FXPESA?

FOREX
Buying and selling one currency for another.

INDICES
A stock index is a measurement of the price performance of a group of shares from a particular exchange. The FTSE 100, for example,
represents the 100 largest stocks trading on the London Stock Exchange. If those stocks increase in price, the FTSE 100 goes up. If those
stocks decrease in price, the FTSE 100 goes down..

CURRENCIES
COMMODITIES
With FXPesa you can trade energy commodities (Oil, Natural Gas), metals (Gold, Silver) and even agricultural commodities
(cotton, cocoa, coffee).

STOCKS
You can buy or sell you favorite company sticks. For example: Facebook, Boing, Netflix and many more

Trading in margined products carries high level of risk.

 Introduction
A B
A. Microsoft

B. Apple

C. Mercedes Benz

D. Adobe

C D
Q&A/Quick concept check questions
CURRENCIES TRADED

Trading in margined products carries high level of risk.

 HOW TO READ A FOREX QUOTE

01 Quoted Pairs
Currencies are
always quoted in
pairs since; in every
foreign exchange
transaction, you are
simultaneously
buying one currency
and selling another. 02 Base/Quote
The first listed currency to the
left of the slash is the Base
currency (the British pound),
while the second one on the
right is called the Counter or
Quote currency (the U.S. dollar).

Trading in margined products carries high level of risk.

 HOW TO READ A FOREX QUOTE

Base Quote

01
Currencies are
always quoted in
pairs since; in every
foreign exchange
transaction, you are
simultaneously
buying one currency
and selling another.

Trading in margined products carries high level of risk.

 TYPES OF ANALYSIS

01 Fundamental analysis
This is the study of economic factors that affect the value of
an asset in order to determine its intrinsic value. This form
of analysis is based on external events and influences, as
well as financial statements and industry trends.

02 Technical analysis
This involves evaluating investments and identify trading
opportunities by analyzing statistical trends gathered from past
trading activity, mainly from price movement and volume.

03 Sentiment analysis
It identifying the positioning of traders,
whether net long or net short, to
influence your own trading decisions.

Trading in margined products carries high level of risk.

 Support & Resistance

Trendlines
Pricing

Traders Path Breakouts

Technical
analysis
Price Action

Candlesticks
 TECHNICAL ANALYSIS

3.
1.
As a trader, you study past
This is the study of historical prices trends and patterns in the
to anticipate the future movement charts to predict future
of prices using the charts as a basic direction of market price.
tool.
The intention is to capture
good trading opportunities.
2.
The origin of technical analysis
is derived from Charles Dow
Theory developed in the
1900’s.

Trading in margined products carries high level of risk.

 TYPES OF FOREX CHARTS – LINE CHART

• A simple line chart draws a line from one closing price to the next closing
price.
• When joined together with a line, we can see the general price movement of a
currency pair over a period of time.

Trading in margined products carries high level of risk.

 TYPES OF FOREX CHARTS – BAR (OHLC) CHART

• Bar chart shows the opening and closing prices, as well as the highest and
lowest price.
• The bottom of the vertical bar indicates the lowest traded price for that time
period, while the top of the bar indicates the highest price the market has
reached.
• The horizontal hash on the left side of the bar is the opening price, and the
right-side horizontal hash is the closing price.

Trading in margined products carries high level of risk.

 TYPES OF FOREX CHARTS – CANDLESTICK CHART

• Candlestick charts show the same price information as a OHLC (bar) chart, but in a
graphic format.
• In candlestick charting, the larger block (or body) in the middle indicates the range
between the opening and closing prices.
• The thin line (shadows/ wicks) show the lowest and highest price reached within that time
range.

Trading in margined products carries high level of risk.

CANDLESTICKS ANATOMY

Trading in margined products carries high level of risk.

 SUPPORT AND RESISTANCE

• These two concepts form the foundation of technical analysis.

• Resistance is a zone where market price pauses before reversing downwards after an uptrend as buyers
may consider the price to be too expensive for them to continue buying.
• It is a ‘ceiling price’ level within a give range of time.
• Traders seek to sell upon market bouncing off resistance as that is a zone of low risk and high potential.

Trading in margined products carries high level of risk.

Sideways (Range)
Keywords
 Getting Set

The Market Strategy

Emotional trading – When personal feelings Trading strategy – A fixed trading plan Economic calendar – Calendar containing all
and emotions impact decision making. designed to achieve profitable returns over time. market moving events. Important for strategy.

Imaging and Keywords

 Getting Set

The Market Strategy Expectations Overtrading

and Emotions

Emotional trading – When personal feelings Trading strategy – A fixed trading plan Economic calendar – Calendar containing all
and emotions impact decision making designed to achieve profitable returns over time market moving events. Good for strategy

Imaging and Keywords

 Getting Set

The Market Strategy Expectations Overtrading

and Emotions

Economic Technical
Calendar analysis

Emotional trading – When personal feelings Trading strategy – A fixed trading plan Economic calendar – Calendar containing all
and emotions impact decision making designed to achieve profitable returns over time market moving events. Good for strategy

Imaging and Keywords

 Getting Set

The Market Strategy Expectations Overtrading

and Emotions

Economic Technical Risk

Calendar analysis

Emotional trading – When personal feelings Trading strategy – A fixed trading plan Economic calendar – Calendar containing all
and emotions impact decision making designed to achieve profitable returns over time market moving events. Good for strategy

Imaging and Keywords

 Getting Set

The Market Strategy Expectations Overtrading

and Emotions

Economic Technical Risk

Calendar analysis

Emotional trading – When personal feelings Trading strategy – A fixed trading plan Economic calendar – Calendar containing all
and emotions impact decision making designed to achieve profitable returns over time market moving events. Good for strategy

Imaging and Keywords

Recap