1) What makes forex different from other markets?

Forex is decentralized and traded OTC. Prices are quoted by banks and liquidity providers; brokers aggregate feeds. Trading runs 24/5 with fragmented regulation.

2) What is a pip, and why does it matter?

A pip is the smallest standardized unit of price movement—typically 0.0001 for most pairs and 0.01 for JPY pairs. It underpins P/L, spreads, and sizing.

3) What are currency pairs, and which ones trade most?

Forex is always traded in pairs. The Majors (EUR/USD, USD/JPY, GBP/USD, USD/CHF, AUD/USD, NZD/USD, USD/CAD) dominate volume and liquidity.

4) What is the spread and how is it calculated?

The spread is the difference between bid and ask prices—your implicit cost to enter. Narrow for liquid pairs, wider for exotics.

5) What is a carry trade?

Borrow in a low-rate currency and invest in a higher-yielding one to capture the rate differential. Risky during policy shifts or risk-off events.

6) What times is the forex market most active?

Session overlaps, especially London–New York (13:00–16:00 UTC), show deepest liquidity and tightest spreads.

7) How do I start trading forex?

Choose a regulated broker, practice on a demo, and build a plan combining technicals with economic awareness. Use stop-losses to define risk.

8) What’s the best way to manage risk in forex?

Risk only a small fraction per trade, set stop-losses, avoid over-leverage, diversify pairs, and size positions consistently.

9) What types of accounts exist (micro lots, cent accounts)?

• Micro accounts: 1,000 units per lot, precise risk control.
• Cent accounts: balances in cents, allowing very small trades.

10) What should I look for in a forex broker?

• Regulation & safety of funds
• Trading conditions: tight spreads, fast execution
• Stable, user-friendly platforms
• Strong support & education

11) What is leverage in forex and how should I use it safely?

Leverage magnifies both gains and losses. Keep it modest, size by volatility, and cap risk per trade.

12) What is margin, and what triggers margin calls or stop-outs?

Margin is collateral. If equity falls too low, brokers issue margin calls or close positions. Maintain buffers.

13) What is slippage and how can I reduce it?

Slippage is the gap between expected and filled price. Reduce by trading liquid sessions, using limit/OCO orders, and avoiding major news spikes.

14) What order types should forex traders know?

• Market
• Limit
• Stop / Stop-Limit
• Trailing stop
• Time-in-force: GTC/IOC/FOK

15) What are swaps/rollovers and why do they affect P&L?

Overnight financing credits or debits interest depending on currency rate differentials. Factor carry into expectancy and watch triple-swap days.

16) How can I trade economic news more safely?

Consider standing aside, hedge with options, or trade post-release moves once spreads normalize.

17) Which indicators are most useful for forex traders?

Popular: Moving Averages, RSI, Stochastics, MACD, ATR. Use as context with structure, avoid overfitting.

18) How do I choose currency pairs that fit my strategy?

Match spread, volatility, session activity, correlations, and carry profile to your edge. Backtest per pair.

19) How do correlations impact a forex portfolio?

Pairs can move together, increasing risk. Monitor correlations, avoid stacking similar exposures, diversify or hedge.

20) What should a trading plan include, and how do I measure performance?

Define setups, entry/exit rules, and risk limits. Track expectancy, win rate vs payoff, drawdown, and journal trades.