This is an act of utility or speculation . In the retail world, you "sell" a pair even if you don't own the base currency. You are essentially borrowing the currency to sell it now, hoping to "buy it back" later at a cheaper price. 3. The Hidden Cost: The Spread You’ll notice two prices: the Bid and the Ask .
The price at which the market is ready to buy from you (always lower). buying versus selling currency
The price at which the market will sell to you (always higher).The gap between them is the "Spread." This is the friction of the market—the "tax" you pay to the house for the privilege of trading. 4. The Macro View This is an act of utility or speculation
The second currency (USD) is what you use to settle the bill.If you think the Euro will get stronger or the Dollar will get weaker, you Buy (Go Long). If you think the opposite, you Sell (Go Short). 2. The Psychology of the Trade The price at which the market will sell
In the world of forex, buying and selling aren't two different actions—they are two sides of the exact same coin. When you "buy" a currency, you are simultaneously "selling" another to pay for it.