Buy or Sell in MT4?

Beginner Questions
1

Greetings to all,

I have never ever felt this dumb but maybe its proof of facts…
I downloaded MT4, started to read a beginners book on forex but I can not understand how
the currency pair works and the difference in “buy” and “sell” in MT4!??

Lets pretend I want to trade EUR/USD (since the Euro is weak against the dollar but I have forcasted strengthening in Eurozone and therefor I want to buy EURO.
And in demo account I have $1000 - but should I use “buy” or “sell” in MT4? Confused since I am selling my $dollars and want to buy EUR…or?

Its easy to understand when trading stocks but this has some kind wierd logic to it =)

Lets say I instead have forcasted that the dollar will increase strenght vs euro and in demo account I have $1000 - what to do now? Just wait untill dollar goes up against EURO?

2

In forex when you buy, it means that you buy the base currency and sell the counter currency. And when you sell, it means that you sell the base currency and buy the counter currency.
In EUR/USD, EUR is the base and USD is the counter. If you want to buy Euro then open a buy position, If you want to buy USD then open a sell position, because you are selling Euro and buying USd.
Hope this helps.

1 Like
3

Here is the simple logic that will not get you confused. Lets take the EURUSD for example, if you click the Buy Botton on your mt4 platform, your trade will be executed and it means you have bought the base currency EUR to sell the quote currency USD. When the price quote for this pair rises, you will make profit. If you sell the EURUSD and the price quote falls, you will make profit. If it moves otherwise, it is loss of money.

4

To understand it in a simple way, focus on the Base currency, which is the firts currency symbol on the pair. If you think the base currency is going to rise in value versus the quote currency or second symbol on the pair, then you Buy. If you think the base currency is going to drop in value versus the quote currency, then you sell.

5

Try this out. Go t utube and search [U]difference in “buy” and “sell” in MT4! forex[/U]
Good Luck
Gp

6

It is not a dumb question and better to ask and be clear than fumbling around. As mentioned above in forex you have a base currency (in your EUR/USD example the Euro is the base currency) and a quote currency (in your EUR/USD example the US Dollar is the quote currency).

Think of it this way, the EUR/USD indicates how many US Dollars are worth 1.00000 Euros (same applies to any other currency pair so the quote currency is the value of 1.00000 of the base currency (some currency pairs are quoted only to the third decimal such as the EUR/JPY).

7

There is even better and easier explanation - click sell when you think that price will go down and vice versa. Basically, you don’t need to know math behind the spread, lot and price decimals, just guess which currency will be stronger over another and you are in profit.

8

Think of that like you are buying only one thing (one currency pair).