Can someone explain this?

Trading Discussion
1

8/10/2009 12:40:23 AM 54255345 Sell EUR/USD -100,000.00 1.42056

8/10/2009 12:41:05 AM 54255403 Buy EUR/USD 100,000.00 1.42074

8/10/2009 12:41:05 AM Total: -18.00

I accidentally pressed Sell first before buying, bought one lot for a higher price later and still seeing a negative amount. This happened in a practice account.

I’m a total newbie, learning and practicing. So please explain if what I did is valid in the actual world and please explain.

Thanks,
Thilak Raj

2

Hi Thilak,

You initially sold the EUR/USD at the price 1.42056. If you sell something, you need the price to go down in order to make a profit. You want to buy it back at a lower price.

If the price goes up, then there will be a loss. Your buy order was for the price 1.42074 which is a higher price. The market moved up so you incurred a loss.

3

Thanks for the explanations Jason.

I never thought this could be done and so was a bit confused.

4

You’re welcome, that’s one thing about currencies, you can take advantage of the market moving down just as easily as moving up. The BabyPips lesson here is a good place to get started with this Trading Forex: How to Make Money in Forex Currency Trading

It also gives an explanation as to what you are buying or selling.