Trading Rules MetaFX

This article describes the rules for Forex trading with a MetaFX account on the MetaTrader4™ trading platform.

If you haven’t traded on the Forex market before, this article will help you understand how to make transactions and earn on the Forex. The focus will be on using MetaTrader4™ to trade currencies on the Forex market.

If you have experience trading on the Forex, this article will help you understand how the МetaTrader 4 platform differs from other trading applications available from FOREX CLUB, learn its distinctive features and understand terminology used in the platform.

How to make money on the Forex market

1) Making a profit

To make a profit, you must buy currency low and sell it high or vice versa, i.e. sell it high and then buy it cheap. The profit you earn depends on the difference between the buying and selling prices.

If you correctly forecast price movement trends, you make a profit. If your forecast was wrong, you lose money.

Even though you have your deposit in US dollars, you can sell any other currency from the list of the currency pairs at any time. Thus you can earn both when a currency appreciates and when it declines.

2) Transaction amount. Trading account balance. Rate of return and risk.

The amount of profit you earn also depends on the amount of the transaction, i.e. the volume of currency bought or sold. The bigger the amount of the transaction, the more profit you can gain when the price changes, but risk of loss is also higher. MetaTrader4™ measures transactions in lots, or portions thereof (one lot is 10,000 units).

The maximum transaction you can make depends on your deposit, i.e. the amount of money in your MetaFX account. When trading on the Forex market, you can buy and sell currency amounts exceeding your deposit amount by means of leverage. FOREX CLUB applies floating leverage based on total position volume to all of its MetaFX accounts. MetaFX accounts with total open positions of less than $5 million carry a maximum leverage of 1:200. This means that the nominal value of a trader’s total open positions at any given time may be up to 200 times greater than his/her current account balance. Accounts with total open positions greater than $5 million carry a maximum leverage of 1:100. Accounts with total open positions greater than $30 million carry a maximum leverage of 1:20. For all MetaFX accounts, the maximum possible leverage is 1:200.

Your account funds are used as the margin for your transactions. Your margin is neither a commission, nor a transaction fee: the money still belongs to you, and you can withdraw it at any time if it is not being used to cover current open positions.

You can specify a transaction amount for the given deposit, which means you can manage your leverage and risks accordingly.

Here is an example of how MetaFX floating leverage works:

1. Position 1

Buy 20 lots of GBPUSD at 1. 5860
Nominal value: 20 * 100,000 * 1.5860 = USD 3,172,000
Because the nominal value of USD 3,172,000 does not exceed USD 5,000,000, the margin requirement is calculated using leverage of 1:200.
Margin: 3,172,000:200 = USD 15,860.

2. Position 2

Sell 10 lots of EURUSD at 1.3694
Nominal value: 10 * 100,000 * 1.3694 = USD 1,369,400
Total nominal value for Positions 1 and 2:
3,172,000 (Pos. 1) + 1,369,400 (Pos. 2) = USD 4,541,400
Since the total nominal value of the positions does not exceed USD 5,000,000, 1:200 leverage still applies.
Margin: 3,172,000:200 + 1,369,400:200 = USD 22,707,

3. Position 3

Buy 10 more lots of GBPUSD at 1.5850
Nominal value: 10 * 100,000 * 1.5850 = USD 1,585,000
Total nominal value for Positions 1, 2 and 3:
3,172,000 (Pos. 1) + 1,369,400 (Pos. 2) + 1,585,000 (Pos. 3) = USD 6,126,400
Now that the total nominal value of the three open positions exceeds USD 5,000,000, the total margin is calculated differently: leverage is 1:200 for the first USD 5,000,000 and 1:100 for the remaining amount (USD 1,126,400).
Total margin:
5,000,000:200 + 1,126,400:100 = USD 36,264

4. Close Position 2 (nominal value of USD 1,369,400)

Once the position is closed, the total nominal value for Positions 1 and 3 is:
3,172,000 (Pos. 1) + 1,585,000 (Pos. 3)= USD 4,757,000
Closing Position 2 reduces the total nominal value of the open positions and significantly reduces the required margin by bringing the client’s open positions under the cutoff point beyond which margin requirements increase (remember, positions over USD 5 million are subject to 1:100 leverage).
New margin: 3 172 000:200 + 1 585 000:200 = USD 23,785

3) Instruments

The Forex market trades in currency pairs. For example, when you trade the EURUSD (EUR/USD, EURUSD) instrument, you buy or sell the desired amount of Euros (EUR) for US dollars (USD), for example at an exchange rate of 1.35624 US dollars for 1 Euro. Traders typically call this type of transaction buying or selling the EUR/USD instrument. The currency that you buy or sell is usually referred to as the base currency.

The currency used to buy the base currency (which is a reference for the value of the base currency) is referred to as the counter currency (or quote currency).

4) First transaction

Before executing a transaction, you must decide on the following:

  • Select an instrument (MetaTrader4™ uses the term "symbol" instead of "instrument") – this is the currency pair on which you want to make a profit from exchange rate movements (such as EURUSD, if you have an opinion on how Euro will change its relative value against US dollar).
  • Select the amount of transaction - the larger the amount, the more you can gain when the price changes, but your risk of loss is also higher.
  • Choose whether you want to buy or sell the given instrument (if you think that Euro will appreciate against US dollar, you buy EURUSD; otherwise you sell it).

To execute the transaction, you must submit a corresponding order to the brokerage company. MetaTrader4™ uses the term "order" (instead of "transaction", as in Rumus). In the Order window you will see a list of financial instruments (symbols) for which the terminal receives quotes from the server. The data in the window is presented as a table. The Symbol field shows the name of the financial instrument, the Bid and Ask fields show prices, and the Time field shows when the prices were received from the server. The Maximum and Minimum fields are calculated based on price dynamics over the course of the day. You can use this window to place market and pending orders and open new charts. Just right click in the Order window to open a context menu with all the necessary commands. Make your choice and click Buy or Sell. The words "Order sent for execution" will appear briefly in the same window, followed by confirmation that your order was placed. Once your order is placed, the transaction is executed at the price you clicked and an open position appears on the Trade tab in the Terminal window.

You can also execute an order from the chart: right click anywhere in the chart, click Trade and then New Order. This will open a window for your order.

5) Opening a position

Once a transaction is executed in MetaTrader4™ you have an open position. When you have an open position, each change in the quote for your instrument (symbol) causes a change in your profit or loss. This is the so-called current or floating profit. Pay careful attention to how your order is displayed in the Terminal window. The Trade tab contains information about the current status of your trading account, open positions and pending orders. Your open positions can be sorted using any of the fields. The Trade tab also shows your account balance and the financial result of your open positions, followed by a list of pending orders. When a pending order is triggered, a new position opens and the pending order line is deleted and replaced by an open order line. MetaTrader4™ uses the following terms:

  • Order — transaction ticket number, unique to a specific trade.
  • Time — time the position was opened, displayed in YYYY.MM.DD HH:MM format (year.month.day hours:minutes).
  • Type — type of transaction. Several types of transactions are possible: Buy (long position), Sell (short position), and multiple types of pending orders (Sell Stop, Sell Limit, Buy Stop, Buy Limit).
  • Volume — number of lots in the transaction. The brokerage company sets a minimum number of lots, and the maximum number of lots is determined by your account balance.
  • Symbol — name of the financial instrument in the transaction.
  • Open Price — the price at which the position was opened (don’t confuse this with current price, defined below).
  • S/LStop Loss level. If the order has not been placed, there will be a zero in this field.
    You can learn more about working with orders in the order section of this guide.
  • T/P — Take Profit level. If the order has not been placed, there will be a zero in this field.
    You can learn more about working with orders in the order section of this guide.
  • Current Price — the current price for the instrument (don’t confuse this with the open price, defined above).
  • Commission — the commission charged by the brokerage company on trading operations.
  • Swap — displays accrued swap points.
  • Profit — displays the financial result of completing the transaction at the current price. A positive result indicates that the transaction is profitable, while a negative result indicates a loss.
  • Comment — this column lets you add comments to your trading transactions. Comments can only be added when you open a position or place a pending order. Modifying an order or position does not let you add comments. The brokerage company may add comments to your trading transactions.

6) Closing a position

A position is opened every time you buy or sell a financial instrument (symbol). In order to earn a profit on exchange rate fluctuation, you have to close the position by performing an opposing transaction. The MetaTrader4™ client terminal differentiates between closing a single position, closing a position with an opposing position, and closing multiple opposing positions.

Closing a single position

A single open position is automatically closed when the Stop Loss or Take Profit prices are met.

Important: When you close a long position the Bid price must correspond to the Stop Loss or Take Profit level. When you close a short position, the Ask price must correspond to one of those levels.

To close a position manually, go into the Trade window and choose the command from the context menu for the open position. You can also double click on the position. If the instrument for which you want to close a position is traded using request execution, you must first click Quote to request a quote. This will activate the button for closing the position.

Important:

  • Quotes are only active for a few seconds. If you can’t make a decision in that amount of time, the Close… button will be locked again.
  • The client terminal lets you partially close positions. Simply specify less than the full number of open position lots in the Volume field before clicking Close...
  • The broker may also close positions, such as when the Stop Out level established by the broker is reached.
  • The terminal draws historical charts using only BID prices, but some of the prices displayed in charts are ASK prices. To turn on the ASK price for the last bar, check the Show Ask Line option in the terminal settings.

Closing opposing positions

MetaTrader4™ defines an opposing position as being in the same instrument (symbol) but in the opposite direction. If your open positions include one or more opposing positions, you can close a selected position along with its opposite. First, open the Order window (we describe how to do this above). Under Type, choose Close by the opposite. You will see a list of all opposing positions in the lower half of the window. From this list, choose the opposing position. The Close Order button will become active, and if clicked will close both positions simultaneously. If the opposing positions were for different numbers of lots, only one of them will remain open with a volume (number of lots) equal to the difference between the closed positions. The direction and open price for the position (short or long) will be equal to the greater of the closed positions (by volume).

Closing multiple opposing positions

In MetaTrader4™ you can close multiple opposing positions in the same instrument simultaneously. To do so, open the Order window (we describe how to do this above). Under Type, choose "Multiple close by". In the lower part of the window you will see a list of all opposing positions and the button "Multiple close by", which will be active. Clicking this button will close all of your opposing positions. Positions are closed in pairs according to the time each position was opened by means of special algorithm. If the difference between two opposing positions is not equal to zero, a new position will be opened with a volume equal to this difference. The new position will also be included in the multiple closure based on the time it was opened. This process continues until all positions are closed or until a final difference position is opened.

Important: Closure of opposing positions is noted on the Account History tab and internal information about the transactions is listed in the Comment field.

  • Remember that attempts to close an open position by other means (by making a transaction in an instrument in which you already have an open position, whether Buy or Sell) will open a new position instead of closing the existing position.

7) Traded instruments

Choose an instrument to trade by clicking New Order.

MetaFX accounts can trade the following currency pairs:

EUR/USD Euro/US dollar,
GBP/USD British pound/US dollar,
USD/JPY US dollar/Japanese yen,
USD/CHF US dollar/Swiss franc,
EUR/JPY Euro/Japanese yen,
EUR/CHF Euro/Swiss franc,
CHF/JPY Swiss franc/Japanese yen,
AUD/USD Australian dollar/US dollar,
NZD/USD New Zealand dollar/US dollar,
USD/CAD US dollar/Canadian dollar,
CAD/JPY Canadian dollar/Japanese yen,
GBP/JPY British pound/Japanese yen,
EUR/GBP Euro/British pound,
GBP/CHF British pound/Swiss franc,
AUD/JPY Australian dollar/Japanese yen,
EUR/CAD Euro/Canadian dollar,
GBP/CAD British pound/Canadian dollar,
AUD/CAD Australian dollar/Canadian dollar,
AUD/CHF Australian dollar/Swiss franc,
EUR/AUD Euro/Australian dollar,
CAD/CHF Canadian dollar/Swiss franc,
NZD/JPY New Zealand dollar/Japanese yen,

8) Pip. Tick. Pip value. Calculating profit.

A tick is the smallest possible change in an instrument quote. A pip is the lowest order digit in the quote. If a quote moves 1 pip, it has moved by one lowest order digit. For currency pairs, the tick is usually (but not always) equal to the pip. For MetaFX accounts, all currency pairs have a floating market spread and an extra digit (either a third or fifth place after the decimal, depending on the currency pair). For pairs in which JPY (Japanese yen) is the quotation currency, one pip is equal to 0.01. For all other pairs, one pip is 0.0001.

For currency pairs, the pip value is the profit you will earn if you sell an instrument at a price one pip higher than you bought it. Pip value varies for different instruments and also depends on position volume.

The pip value is approximately $1 for a position volume of 10,000.

For instruments quoted in USD (US dollar), the pip value is $1 for a position volume of 10,000.

For instruments quoted in any other currency, such as CHF (Swiss franc) or CAD (Canadian dollar), the pip value is always equal to 1 unit of the quotation currency (1 CHF, 1 CAD) for a position volume of 10,000. However, pips are always displayed immediately in US dollars (you may choose to display profit in pips, order currency or deposit currency). To do so, divide 1 by the current quote for the currency pair (for example, the current USD/CHF or USD/CAD exchange rate).

For instruments quoted in GBP (British pound) or AUD (Australian dollar), the pip value is equal to $1 multiplied by the exchange rate for the quotation currency against the US dollar (for example, the GBP/USD, AUD/USD or NZD/USD exchange rate) for a position volume of 10,000.

For instruments quoted in JPY (Japanese yen), the pip value is $100 divided by the current USD/JPY exchange rate for a position volume of 10,000.

Profit may be calculated for any position as follows:

Divide position volume by 10,000, multiply by the pip value for a position volume of 10,000, and multiply by the difference in points between the open price and the close price for the position.

9) Spread, No-dealing desk (NDD)

At any given moment the price to buy an instrument is somewhat higher than the price at which you can sell it. Therefore, if you buy an instrument and sell it immediately, you will suffer a small loss. This difference is called spread, and it is a source of profit for the brokerage company.

FOREX CLUB uses the No-Dealing Desk system for its MetaFX accounts.

The No-Dealing Desk system directly connects traders to the financial market, where they can execute transactions without dealer participation. The NDD system offers tight dynamic spreads and fast order execution.

With NDD, FOREX CLUB traders can trade on MetaFX accounts with tight spreads (starting at 0.6 pip) on the interbank market. In addition, client orders of any volume are processed without dealer participation, significantly enhancing execution speed.

Along with NDD, MetaFX accounts have access to quotes to the fifth decimal place for more precise spreads.

Spreads are measured in pips:

Symbol Minimum spread Typical spread
EUR/USD 0,6 1,1
USD/JPY 0,8 1,3
GBP/USD 1,8 2,3
USD/CHF 1,6 2,1
AUD/USD 1,6 2,1
USD/CAD 1,8 2,3
NZD/USD 1,8 2,3
EURCHF 1 1,5
EURJPY 1,8 2,3
CHFJPY 2,2 2,7
EUR/GBP 1 1,5
AUD/JPY 2,2 2,7
GBP/JPY 3,2 3,7
GBP/CHF 3,4 3,9
EUR/CAD 3,2 3,7
GBP/CAD 5,5 6
AUD/CAD 3,4 3,9
AUD/CHF 3,8 4,3
CAD/JPY 3,8 4,3
EUR/AUD 3,6 4,1
CAD/CHF 3,8 4,3
NZD/JPY 2,6 3,1

10) Order types

The MetaTrader4™ client terminal prepares orders, sends them to the broker for execution and includes tools for monitoring and managing open positions. An order tells the brokerage company to execute a specific trading transaction on the client’s behalf. MetaTrader4™ uses the following types of orders: Market order, Pending order, Stop Loss and Take Profit.

  • Market order
    A market order tells the brokerage company to buy or sell a financial instrument at the current market price. Execution of a market order results in an open position. Instruments are bought at the ASK price and sold at the BID price. Stop Loss and Take Profit orders can be added to a market order (these types of orders are described below). The mode in which market orders are executed depends on the financial instrument.
  • Pending order
    A pending order tells the brokerage company to buy or sell a financial instrument at a set future price. This type of order results in an open position once the market price reaches the level set in the order.
  • Stop Loss
    A Stop Loss order limits losses if the price of a financial instrument begins to move into the loss area. Once the price of the instrument reaches the set level, a position opens automatically. This type of order is always linked to an open position or pending order and is only placed along with a market or pending order. When verifying the terms of a Take Profit order, use the ASK price for long positions and use the BID price for short positions.
    A Trailing Stop is used to make the Stop Loss price adjust as the market price fluctuates.
  • Take Profit
    A Take Profit order is used to fix profits once the price of a financial instrument reaches a set level. Execution of a Take Profit order results in the closing of the position. Take Profit orders are always linked to an open position or pending order and are only placed along with a market or pending order. When verifying the terms of a Take Profit order, use the ASK price for long positions and use the BID price for short positions.

Important:

  • The execution price for all trading transactions is established by the FOREX CLUB broker.
  • Stop Loss and Take Profit orders are only executed for open positions, not pending orders.
  • Historical charts are created using only BID prices, but some of the prices displayed in charts are ASK prices. To turn on the ASK price for the last bar, check the Show Ask Line option in your terminal’s settings.

11) Pending order

In order to open a position using a pending order in the MetaTrader4™ platform, first you must place the order. Once the current price corresponds to the pending order terms, the pending order will automatically be executed and a new position opened. On the Trade tab, execution of a pending order deletes the pending order status line and creates a new open position status line. If the pending order included a Stop Loss or Take Profit order, these will automatically be linked to the newly opened position.

MetaTrader4™ uses four types of pending orders:

  1. Buy Limit — buy when the future ASK price reaches the set value (used when the current price is higher than the order price). This type of order is usually placed on the assumption that the instrument price will rise again after declining to a certain level.
  2. Buy Stop — buy when the future ASK price reaches the set value (used when the current price is lower than the order price). This type of order is usually placed on the assumption that once the instrument price reaches a certain level it will continue to rise.
  3. Sell Limit — sell when the future BID price reaches the set value (used when the current price is lower than the order price). This type of order is usually placed on the assumption that once the instrument price reaches a certain level it will begin to fall.
  4. Sell Stop — sell when the future BID price reaches the set value (used when the current price is higher than the order price). This type of order is usually placed on the assumption that once the instrument price reaches the set value it will continue to fall.

Current market Forecast

Stop Loss and Take Profit orders may be linked to a pending order. Once the pending order is processed, its Stop Loss and Take Profit levels are automatically linked to the open position.

To place a pending order, you must open the Order window. There are several ways to do this:

  • go to Tools – New order,
  • click the Order button on the Standard tool bar,
  • press the F9 key,
  • choose New Order from the context menu in the Market Watch window,
  • go to Terminal - Trade,
  • double click on the financial instrument in the Market Watch window.

Under Type, choose Pending order. Then select the financial instrument (symbol), set the volume, and set the Stop Loss and Take Profit levels. You may also make any comments in the Comment field. In the Pending Order field, you must set the following:

  • Type — choose the type of pending order you want: Buy Limit, Buy Stop, Sell Limit or Sell Stop,
  • At Price — set the price level at which the order will activate,
  • Expiry — set the date and time at which the order will automatically be deleted if it has not been activated yet.

Important: an order cannot expire in less than 10 minutes!

Clicking the Place button sends the order for execution, which happens in two steps. After you place the order, the brokerage company accepts it and a line with the pending order number and status appears on the Trade tab. If the Show Trades option is turned on, the chart will show the pending order’s levels (including any Stop Loss and Take Profit levels). In the second step, if the prices match the order conditions, the pending order is deleted and a position is opened. The unique identifying ticket number is the same for the open position as for the pending order. These changes are displayed in the Trade window.

Important: Stop Loss and Take Profit orders only activate for open positions, not pending orders.

Modifying pending orders

Traders often encounter situations when they need to modify or delete a pending order. To do this in MetaTrader4™, choose the command Modify or delete pending order from the pending order context menu or double click on the pending order line in the Trade window. This will open the order management window, where you can set a new trigger price, new Stop Loss and Take Profit levels and change the order expiry date. After making all modifications, click Modify.

Important: Setting the Stop Loss and Take Profit levels at zero is the same as turning off these functions.

Once your order is successfully modified, the field values will change in the Trade window. If the Show Trades option is turned on, the chart will show the pending order’s levels (including any Stop Loss and Take Profit levels).

Deleting a pending order

Market changes may cause you to delete a pending order. To do this, choose the command Modify or delete pending order from the pending order context menu or double click on the pending order line in the Trade window. This will open the order management window, where you can click Delete to delete the pending order. Pending orders are deleted automatically when the Expiry date is reached without the price conditions being met. Once you delete a pending order, the information will appear in the Account History window.

12) Trailing Stop

  • A Stop Loss order limits losses if the price of a financial instrument begins to move into the loss area. When an open position becomes profitable, you can move the Stop Loss manually to the zero-loss level. In MetaTrader4™, Trailing Stop is a very useful tool for automating this process when there is strong price movement in one direction or when you are unable to follow the markets closely.
  • A Trailing Stop is always linked to an open position and is executed in the client’s terminal, instead of on the server like a Stop Loss. To place a Trailing Stop, in the Terminal window right click on an open position and choose the Trailing Stop command from the context menu. From the list that opens, choose the distance you want to set between your Stop Loss level and the current price. You can only place one Trailing Stop for each open position.
  • Once your Trailing Stop is placed, every time the terminal receives new quotes it will verify that the open position is profitable. As soon as the profit in points becomes equal to or greater than the level you set, the terminal will issue an automatic Stop Loss order at the distance you set from the current price. If the price moves in a profitable direction, the Trailing Stop will automatically move the Stop Loss to keep up with the price. If the position’s profitability decreases, no modification is made to the order. This mechanism automatically locks in the profit for your position. Every automatic modification to the Stop Loss order is recorded in the system log.
  • You can turn off a Trailing Stop order by clicking None in the control menu. If you select Delete All Levels, the Trailing Stops for all your open positions and pending orders will be deleted.

Important: Trailing Stops are carried out in the MetaTrader4™ client terminal instead of on the server (like Stop Loss or Take Profit orders). As a result, all Trailing Stops cease to function when you turn off your terminal. Only a Stop Loss order placed by a Trailing Stop will remain active when your terminal is turned off.

13) Calculation of maximum available transaction amount.

The maximum amount available at any given moment for a new transaction on a MetaFX account depends on your usable margin, which is the amount of funds in your account inclusive of the results of all open positions and the amount of your deposit already used.

So if you have an open position(s) with a current profit,
Usable margin = balance- margin amount used + current profit.

If you have an open position(s) with a current loss:
Usable margin = balance - margin amount used - current loss.

The maximum amount of a new currency transaction depends on the usable margin as follows:
Maximum amount of a new transaction = 100 * (usable margin - spread * pip value).

14) Multiple open positions for the same instrument.

If you have an open position for an instrument (symbol) and you think that the quotes will move in the chosen direction, you can open additional positions for the same instrument (symbol). In order to do this you need to execute another transaction involving the same instrument (symbol).

If you are not sure in the chosen trend, you can open an opposite position for the same instrument because in MetaTrader4™ you can simultaneously execute both buy and sell transactions for the same instrument. This trading method is called hedging or locking.

Let’s say you opened a long position but the price went down. As the price moves closer to your imagined Stop Loss level, you decide that you simply opened the position too soon; you still expect it to turn around and head up again. However, you know that you might not have sufficient margin to withstand unfavorable price movement in the interim. So on the one hand, you do not want to get a margin call (stop out), but on the other hand you do not want to close the position with a loss.

In the situation described above, you can kill two birds with one stone by opening a position in the opposite direction. Your losses in one direction are compensated by your profit in the other direction, and your current deposit is protected. As soon as the price reaches what you consider to be the floor from which it will rebound, you close the short position with a profit that bolsters your margin. Now you are no longer in danger of a margin call (stop out) and you can wait for the price to return to a level at which you can close the original long position with a profit.

You can hedge all open positions simultaneously or only hedge some of them. To hedge a position, right click on it and choose Hedge from the context menu. Then choose the amount you would like to hedge. This sends the FOREX CLUB broker an order, and a new open position in the opposite direction appears in your list of open positions.

15) Decreasing open positions

Always remember that if you already have an open position in any instrument (symbol) but believe that the price may turn on you, you can reduce your risks by decreasing the volume of the open position. This is done by means of partial closure.

To partially close a position in the Trade window, click Close… and adjust the volume downward.

For example, if you have an open position with a volume of 0.2, you can close it partially by setting the volume at 0.1.

16) Modifying positions

You can modify a current position by setting new Stop Loss or Take Profit levels. To modify a position, right click on the position and choose Modify or Delete from the context menu. Another option is to double click in the Terminal window on the Stop Loss or Take Profit fields for the open position line. In the new window, set new values for Stop Loss or Take Profit and click Modify.

Enter new values in the Stop Loss or Take Profit fields to change these levels. To set an order at a certain number of The smallest increment of change in a quote (foreign currency price). For example, if the current price of the EUR/USD currency pair is 1,4181 and it changes to 1,4180 this means the price has dropped by one pip from the current price, enter the value you want in the Level field and click Copy as. If these fields are set at zero, the order will be filled with the minimum allowable deviation set by the broker.

If, after you modify a position, the Stop Loss or Take Profit levels are too close to the current price, the Modify button will be locked. When this happens, set the levels further from the current price and click Modify. Your position will be modified once the brokerage company establishes the new Stop Loss and Take Profit levels. On the Trade tab, the S/L and T/P values will also change for the open position. If the Show Trades option is turned on, the positions of any modified orders will change.

Important: Setting the Stop Loss and Take Profit levels at zero is the same as turning off these functions.

17) Rollover fee

While trading on FOREX, you don’t actually buy foreign exchange currency but rather take it on credit from a broker’s company, and at the same time you trust the other currency of the combination to the company. Interest arises since each transaction is essentially a loan. You pay interest to the company on the currency you bought, and you receive interest on the currency you used to buy the Base Currency. Interest rates on various currencies differ; therefore the interest rate you pay and the interest rate you receive do not cancel each other out. The difference between interest rates is called Rollover Fee. This fee depends on whether you buy or sell the instrument; it also contributes to the broker’s profit. A negative Rollover Fee is debited from your account and a positive Rollover Fee is credited to your account.

The Rollover Fee is accrued at end of each business day at 21:00 GMT. In the Table you can see the number of pips that will be debited from or credited to your account at 21:00 GMT. If you close a position before 21:00 GMT, no Rollover Fee will be charged.

18) Market order price changes. Maximum deviation.

Exchange rate values on the Forex market are subject to rapid changes; sometimes they change several times a second. During market volatility, the price you saw in your terminal when you clicked the Buy or Sell may no longer available by the time your order reaches the brokerage company’s server. In this case you receive a Price Changed notice listing the new price. If you agree to the offered price, confirm it with a click. If the broker does not accept the requested price, you get a Requote, meaning that the broker states the prices at which the order can be executed.

When the market is active, a trader often needs to close a transaction by all means, and in such cases it is not crucial that the price may differ by a few pips. If that is the case, a trader can set Trading Range. By setting Trading Range (MetaTrader4™ uses the term Allowable/Maximum deviation), a trader agrees that if the price changes within the stipulated range, he will make a transaction at the offered new price.

19) Automated trading

Developing a successful trading strategy is the best way to operate on the financial markets; however, emotional involvement can make it difficult to difficult to stick to a strategy when trading manually. Automated trading strategies remove that problem. The MetaTrader4™ client terminal offers a wide selection of tools for developing, testing and applying automated trading strategies (expert advisors). Expert advisors don’t just provide trading alerts – they can fully manage all of your trading transactions in real time.

MetaTrader4™ features a built-in programming language (MetaQuotes Language 4), MetaEditor and a variety of tools for testing expert advisors. Use these tools to create:

  • Expert Advisors — programmed trading strategies that let you completely automate your research and trading,
  • Custom Indicators — user-defined technical indicators for analyzing price dynamics,
  • Scripts — programs that run once on command.

20) MetaQuotes Language 4

The MetaTrader4™ client terminal lets you access MetaQuotes Language 4 (MQL 4), the built-in language for creating automated trading strategies. Write your own expert advisors, automate your trading processes and optimize your trading strategies. MQL 4 also lets you create custom indicators, scripts and function libraries.

MQL 4 syntax is very similar to C, and is easy to learn and use. MQL 4 features a large number of functions for quote analysis, position management, launching technical indicators and more. Write your own expert advisors in MetaEditor and use the built-in MetaQuotes Language Dictionary to find descriptions for all MQL 4 constructions and functions.