At any given time, the push and pull of the currency value force a specific currency to either appreciate or depreciate in comparison to its base currency. The rise and fall movement signifies the need for learning about the currency pairs and what they indicate;
- Malaysian forex involves trading currencies in pair. Exchanging Malaysian ringgit (MYR) for Euros involves sets of transaction. The chart offers you an overview of the weight to Malaysian ringgit in relation to Euros. The MYR/EUR price, for instance, signifies how many Malaysian ringgit it takes to buy one euro (EUR).
- Notably, all forex trading platform uses currency symbols in its chart. Such characters include euro(EUR), U.S. dollar (USD), Malaysian ringgit (MYR), British pounds (GBP) and Canadian Pounds (CAD)
- Each forex pair has a direct correspondence to the market price associated with it. The price signifies how much of the second currency is required to buy one unit of the first currency. Looking at the following two currencies; KES and MYR, if the price of 1 MYR to KES is 26.0620 means that it takes Kenyan shilling 26.0620 to buy one Malaysian ringgit. On the other hand, it takes 0.0383700 MYR to buy one Kenyan shilling.
To better trade in the malaysian Forex Market, it is crucial to get familiar with some new terminologies which describe the price of currency pairs. Having clarity on what they mean and how they affect the market will give you an insight into calculating the trade profit.
Notably, many currency pairs move about 50 to 100 pips per day. A pip (Point In Percentage) is the name used to indicate the sixth decimal place in the currency pair. Using the previous example, when the price of MYR/KES moves from 0.0383700 to 0.0383750, that's a 50 pip move, which means if you bought the pair at 0.0383700 and sell at 0.0383750, you will make a 50 pip profit.
For the trading purpose, the first currency listed in the pair is always the directional (lead) currency on a forex price chart. Take a sneak peek at Malaysian forex chart, MYR/KES means that the MYR is moving higher relative to the KES. The vice versa means the MYR is declining in value relative to the dollar.
Note that the best ways to learning forex are to watch the trend on how the prices move in real-time. Several best forex brokers in Malaysia offer online or mobile phone app-based paper trading accounts that work exactly like the live trading accounts, without risking your capital too much. Many local and foreign investors with foreign currency have become open and active in all manner of investment vehicles, including forex trading.