1. Tips for Pips

2. What is the purpose of financial markets?
A place where buyers and sellers come together to trade in financial assets.

3. What can we trade? Currencies Bonds Commodities Equities
Market indices
Derivatives

4. Ways to Trade
Short Selling- selling a stock you don’t own and you have to buy it back later.
Long Selling- selling a stock after buying it yourself.

5. Introduction – About Elxi Markets
Online FCA regulated brokerage based in the heart of the City of London. Offering competitive spreads and low commissions via MT4. 100% STP Execution

6. What is MT4?
MetaTrader 4 is a free-of-charge program specially designed for online trading. It was developed by MetaQuotes Software and released in 2005.

7. Execution
Forex is an OTC (over the counter) product there's no central exchange – traded directly bank-to-bank and through electronic networks. The MT4 platform automatically routes each trade to our liquidity pools via STP (Straight Through Processing). Thereby all our trades are transmitted immediately to an execution broker. The execution broker receives and aggregates prices from a number of liquidity sources (e.g. Credit Suisse, JPMorgan, Commerzbank, etc.)

8. Straight Through Processing
Elxi Markets monitor all liquidity sources for the best available quote and executes the trades it receives from us on a matching principle. This works in a similar manner as a central order book on an exchange meaning that bid and asks are sorted by type, price and entry time remaining anonymous until executed.

9. Benefits of STP Here, you can see how a low execution
speed can affect your trading.
You might have an ideal entry point
in your chosen market (1).
However, when you attempt to place
the trade, it is not executed.
The market might then move in your
favour, unfortunately without the
trade being executed.
You would most likely be then offered
a “re-quoted” price (2). 

10. Advantage of trading FOREX?
Referred to as Forex, Retail FX, FX, Spot FX or Spot The largest financial market in the world, with a volume of around $USD 4.5 trillion a day Compare to NYSE which trades around $USD 39 billion a day It’s about three times larger than all the stock markets in the world combined...

11. 24 Hour Market
Starts Sunday 10pm GMT and finishes Friday 10pm GMT – does not actually close
Starts Sydney → Tokyo → London → New York

12. Forex Terminology
Pip stands for percentage in point, the smallest increment by which a Forex cross price changes. Take £1 = USD
Elxi Markets quotes to 5 decimal places.
We ‘care’ about the last 2 digits – these are referred to as ‘Pips’
So if we long ‘Cable’ at and we were looking to make 2 pips, we are looking to close our trade at
When trading the Yen there are only 3 decimal places – Example $/Yen
1 Pip is 1/100th % of change.

13. Forex Terminology
Spread: The difference between the Bid price at which you can sell the trading instrument and the Ask price at which you can buy the trading instrument.
Lot: Used in Forex and Futures contract trading to define a fixed contract size corresponding to a fixed amount of the item that will be traded in the future. For most currency pairs 1 lot is units of the base currency.

14. Forex Terminology
Currency pairs are usually traded in units of 100,000 (standard lots),  10,000 unit (mini lots) or 1,000 (micro lots) meaning buying / selling 100,000 of the base currency while selling / buying the equivalent number of units of the counter currency.
For example, if you open a long position of one lot for EUR/USD for the ask price of , you are purchasing 100,000 Euro while, selling 110,000 USD.
A standard contract (one Lot) in which the USD is the counter currency one pip will equal $10 ($1 for a mini lot). For all other pairs exact pip values are slightly different. Use our Pip Calculator to see the current pip value for all currency pairs.

15. Terminology
Margin: The amount of equity (collateral) required for an investment position, as a percentage of the current value. When trading on margin (also called 'gearing', or 'leverage'), you need to only deposit a fraction of the current value of the instrument you are investing in. For example, if the commodity you are trading in requires a margin of 5%, you are able to gear (or leverage) your investment 20 times. In other words, a deposit of USD can hold a position of USD
Leverage: The ability to hold an investment position of greater value than that of your equity (collateral). When leveraging (also called gearing) your investment, you need only deposit a fraction of the current value of the instrument you are investing in. For example, a leverage of 1:100 means that you need to deposit 100 times less than the contract size to make a transaction.

16. Other Factors
Storage is the charge to rollover a position overnight. It can be either positive (credited to your account balance!) or negative (debited from your account balance) depending on the difference between the interest rates of the countries whose currencies you trade.

18. MetaTrader 4

19. Japanese candlesticks display the high, low, opening and closing prices

20. MT4 - Market Watch
You use the “Market Watch” window to view the real time market prices – both the “Bid” and “Ask” prices.
The “Bid” price is the level at which you are able to sell (go short) that specific market.
The “Ask” price is the level at which you are able to buy (go long) that specific market.

21. FX The Base currency is ALWAYS EQUAL to ONE Lets take GBP/USD
In this example it is currently trading at
“Meaning” 1 GREAT BRITISH POUND is currently worth US Dollars

22. Placing an Order

23. Order Window
 Symbol – this shows you your chosen market / instrument which you have decided to trade in (above example is GBPUSD).
 Volume – quantity or size of the market which you wish to trade. A trading volume of 1.00 equals 100,000 units and 0.10 equals 10,000 units.
Stop Loss – a future price level at which you have specified to automatically close your position, realising a pre-determined and acceptable loss
Take Profit – a future price level at which you have specified to automatically close your position, realising a pre-determined and acceptable profit

24. Order Types
Market Execution Order : it allows you to place either a buy or sell order at the current market price.
Pending Execution Order : allows you to place an order which will only be executed when the market reaches a specific price as dictated by you.

25. Pending Orders
“Buy Limit” order : you wish to go long (buy) at a price below the current market price
“Buy Stop” order : you wish to go long (buy) at a price above the current market price
“Sell Stop” order : you wish to go short (sell) at a price below the current market price
“Sell Limit” order : you wish to go short (sell) at a price above the current market price

26. Finding Opportunities
There are two main ways traders attempt to find opportunities. Technical Analysis Fundamental Analysis

27. Fundamental Analysis
Fundamental Analysis: Using real data to evaluate market values, E.g. News, politics, financial statements, overall wellbeing of market etc. Every day economic data is released from different countries. Some information is more important that others. The greater the importance the larger the expected move in the markets will be, as more traders will be focusing on it. Unexpected data is more likely to move the market.

28. Analysis
The economic calendar displays the importance.

29. Factors affecting the Currencies
Growth (i.e. IR and inflation) Financial Risk (i.e. debt), Earnings (i.e. GDP, production, retail, home sales)

30. Factors affecting the Markets
Factors that may affect Shares: The company's financials and operations, sales, earnings, growth potential, assets, debt, management, products, and competition.
Factors effecting Commodities:
Demand > Supply = higher price, Supply > Demand = lower price, The weather, Crop planting/ production and stocks, Technology, Labour costs

31. Unemployment
High levels of unemployment indicate lower growth prospects for a country as unemployment gives rise to the opinion of poor job security in the wider economy.
= less disposable income = lower spending
Look at average earnings!
A high average earnings number would suggest that there is greater buying power and in turn this should impact equity markets in the same way.

32. Unemployment

33. Industrial Production

34. Economic Indicators

35. Technical Analysis
Technical Analysis: Studying price action and charts, looking at movements in price and making decisions according to calculations
E.g. Japanese candlesticks, moving averages, triangles, oscillators etc.

36. Technical Analysis
Ascending Triangle
Descending Triangle

37. Moving Averages
A moving average calculates the average price of a security over a specific period of time.
For example, if we take the closing prices of the last 10 trading days, we would add them all together and divide the result by 10.
There are different types of moving averages, the two main ones are:
Simple Moving Average (SMA)
Exponential Moving Average (EMA)

38. Simple Moving Averages
Calculated by adding the closing price of a security for a number of time periods and then dividing this total by the number of time periods. This shows the average price for a security over a set time, giving equal weighting to each unit of time. So it gives you an idea of what the price has done and as a result can be used to give you an idea of where the price is going without focusing too much on the noise.

39. The Three M’s Mind – Proper mental approach to trading.
Method – A working system
Money management – Good money management practices.

40. Contact Us 30 Crown Place, London, EC2A 4EB info@elximarkets.com