Hi, I’ve been trading on a demo account and so far I’ve been doing well but I’m interested in learning about different entry points and exits.
Can someone briefly define what a short entry and a long entry is?
And if there are different exit names, then those too.
Thank you!!
You will find all your answers here.
Take your time through it:)
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I’ve gone through all the grades but I can’t seem to understand the difference between the two. All I really understood was that they have to do with the main trend line 
That being said, thank you, because the school really is fantastic. I just have to tie some loose ends now… lol
Short or long relates to the order the order of your trade.
Going long means you buy in first, planning for price to increase. You’re a bull, or buyer in this case.
Going short means you sell in first, planning on price to drop. You’re a bear, or seller in this case.
Going long= Buy low, sell high.
Going short= Sell high, buy low.
Ah alright, so basically when you’re selling, you can call it going short, and when you’re buying, you’re going long.
Is there a reason for calling it short or long or is that just a word that stuck with it’s meaning?
Technically speaking, in spot forex trading (and futures) you don’t actually buy or sell anything. Long and short are actually the more proper terms as they indicate a price exposure rather than ownership.
Hi, J
[I]Buying[/I] means [I]going long[/I], if it applies to opening (entering) a position. [I]Buying[/I] does not mean [I]going long[/I], if you are buying to close a position.
Similarly, [I]selling[/I] means [I]going short[/I] if it applies to opening (entering) a position. It does not mean [I]going short[/I], if you are selling to close a position.
Let’s run through an example, to illustrate the terminology (key terms are shown in [I]italics[/I]).
Let’s say you have no position in the market. You think the EUR/USD is heading lower, and you decide to sell the EUR/USD.
[I]You have just gone short[/I], and while you are in this position, [I]you are short the EUR/USD[/I].
Now, let’s say you decide to close that position. You close it by buying the EUR/USD. But, this is NOT [I]going long[/I]. This is exiting your [I]short position[/I] on a buy-order. (In commodity futures trading, we refer to this as [I]covering your short[/I].)
Now that your short position is closed, you are out of the market. You are [I]neutral[/I].
Suppose you now think that the EUR/USD is headed higher, and you decide to buy the EUR/USD. [I]You have now gone long[/I], and while you remain in this position, [I]you are long the EUR/USD[/I].
When you decide to close your long position, you do so by selling the EUR/USD. But, this is NOT [I]going short[/I]. This is exiting your[I] long position[/I] on a sell-order. (In commodity futures, we refer to this as [I]liquidating your long[/I].)
Hope that helps.
This isn’t correct. To close and open position in futures and spot forex your enter an opposing position - going short when you’re long, going long when you’re short. That creates an offset, so your exposure becomes zero (it’s the same thing as “hedging”). In futures the clearing house handles things, matching up your prior long or short against someone else’s short or long. In forex your broker effectively does the same thing.
Think about the mechanics and you’ll see why it works this way. When you put on a position you’re actually entering into an agreement with another trader to do a future exchange. It’s a contract. Can you just get out of a contract because you decided you wanted to? Generally, no. It takes mutual concent. If you’re long and want to get flat, that means the short on the other side of the deal has to get flat as well. What if he doesn’t want to? Then you’re stuck. That’s why in futures there’s the clearing house, and in forex the brokers act in a similar fashion.
This isn’t like stocks. You don’t own something and then sell it when you no longer want the price exposure, passing ownership over to someone else. That’s why buy/sell is technically incorrect, though obviously it’s still the common parlance.
Yeah, but…
Do you really want to make communication as difficult as possible?
Communicating effectively with brokers and other traders requires a common language, or a “common parlance”, as you call it.
Every currency trader in the world knows exactly what we mean when we use the “common parlance”.
If I want to get out of a long position, I’m going to click a button on my trading platform which says “SELL”.
I’m sorry if that word upsets you.
It’s so much better than a button which says “MATCH MY PRIOR LONG POSITION AGAINST SOMEONE ELSE’S SHORT POSITION”.
I have to side with Clint on this one. At the risk of offending Clint, I’d have to say that Rhodytrader knows more about forex than Clint and I combined, but this site is called Babypips, not ForeignExchangeAnalystpips. 
Sometime it’s possible to provide too much information, even if it is good, correct information…
No offense guys, but not understanding what’s going on is one of the reasons new traders lose money. I don’t go around correcting buy/sell in normal posts, but when the discussion gets into the more functional elements of what’s going on I’m going to point out errors if I see them. I brought up the difference in terminology in this thread because JSchay seemed to be struggling. I’ve seen enough posts here where newbies think they are taking posession of currency in some way, shape, or form to know that it’s a point of confusion. I try to remedy that.
As for making communication more complicated, I think Clint’s whole buy to open/buy to close discussion handled that. For a second there, I thought I was reading something for options traders, where that sort of terminology is specifically used (at least with my broker). 