How forex trading works, from quote to closed position
Base and quote currencies, bid and ask, lots, pips, margin and the daily rollover, followed through one illustrative trade from start to finish.
Forex and gold
The DravoTrader long read
Forex Explained: Guides, Tools & Market Hours
Forex explained the slow way: what a currency quote actually says, why a pip is worth what it is worth, what leverage does to a small deposit, and who is on the other side of your trade. Then the same patient treatment for gold, shares and crypto, and for the firms that want your money.
Every article is free to read. Nothing on this site is for sale, and nothing here is advice.
Read this first: DravoTrader is not a trading platform
The name sounds like a broker. It is not one. DravoTrader is an independent publication that explains markets and how to check the companies that sell access to them.
- No accounts, logins or sign-ups exist on this site.
- We never take deposits, place trades or hold anyone's money or coins.
- We never send trading tips, "signals" or investment offers by message, phone or social media.
If someone offers you an account, a bonus or a recovery service under the DravoTrader name, it is an impersonation. Read how trading scams work and tell us about it.
- Ten checks before you hand a firm your moneyLicences, clone firms and the withdrawal test.
- The costs nobody puts in the advertSpreads, swaps, conversion charges and network fees.
- MetaTrader is software, not a brokerWhy a genuine app can still connect you to a fake firm.
Featured long reads
Pull up a chair: the guides worth your full attention
Each of these takes ten to fifteen minutes. They are written to be read start to finish, with worked numbers you can check yourself.
How to spot trading scams before they spot you
Romance-to-investment schemes, cloned firms, fake apps and "recovery" agents, and the questions that expose them.
Safety
How crypto works under the hood
Keys, wallets, blocks and confirmations, and why a mistaken transfer usually cannot be reversed.
CryptoThe stock market for beginners
What owning a share gives you, how orders reach an exchange and why indices move the way they do.
StocksWhat is USDT, and what could go wrong?
How a dollar stablecoin is meant to hold its value, why the network matters, and the risks that remain.
CryptoScam watch
Four warning signs that end the conversation
Most investment fraud follows a script. If you meet any of these, stop, keep your money where it is, and check the firm independently.
- Returns are promised or "guaranteed"Real markets fall as well as rise. A fixed weekly or monthly return is the signature of a scheme paying old investors with new money.
- You were approached firstA friendly stranger, a wrong-number text or a dating match that turns to trading is how many losses begin.
- Withdrawals need a fee or a "tax" firstA genuine firm deducts its costs from your balance. Being asked to send more money to release your own is a hallmark of fraud.
- The firm is not on the regulator's registerOr it is, but the phone number, website or email address differs from the one listed there, which points to a clone.
The full walkthrough is in our scam guide, and how to choose a broker turns these warnings into a checklist you can run on any firm in about twenty minutes.
Forex explained in four ideas
The vocabulary you need before any chart makes sense
Currencies are always priced against each other, so every quote is a pair. Four ideas carry most of the weight.
Pairs
EUR/USD at 1.0800 means one euro costs 1.08 US dollars. Buying the pair means buying euros and paying in dollars.
Pips
The standard step in price: 0.0001 on most pairs and 0.01 on yen pairs. On one standard lot of a dollar-quoted pair, a pip is worth $10.
Lots
Trade size. One standard lot is 100,000 units of the first currency; mini and micro lots are a tenth and a hundredth of that.
Leverage
Borrowed exposure. At 30:1, a margin deposit of $1,000 controls a $30,000 position, and losses are measured against the whole $30,000.
Gold is usually quoted the same way, as XAU/USD, with a lot commonly set at 100 troy ounces. Our markets overview compares forex and gold with shares and crypto side by side.
Which markets are trading right now?
Your device time: –
Worked out in your browser from each market's regular session. Public holidays and early closes are not included, so treat it as a guide.
MarketNowRegular hours (local time)Guide
Spot goldXAU/USD–Sunday 18:00 to Friday 17:00, New York, with a daily one-hour breakGold margin maths
Tokyo stocksTokyo Stock Exchange–Monday to Friday 09:00 to 11:30 and 12:30 to 15:30, TokyoMarkets overview
Calculators
Do the maths before the market does it for you
Four small tools, each with its formula on show. They run on your device and store nothing.
Pip valueWhat a one-pip move is worth on any size, before you set a stop.lots × lot units × pip size ÷ ratePosition sizeWork backwards from the amount you can afford to lose.risk amount ÷ (stop in pips × pip value)Leverage and marginHow much of your balance a leveraged trade locks up.notional value ÷ leverageCrypto profit and lossThe real result of a buy and a sell once fees are taken twice.coins × sell price × (1 − fee) − stake
Everything in the feed
Every guide on DravoTrader, grouped by what you want to understand.
Forex and gold
Who is behind DravoTrader?
A small independent editorial team that writes, checks and updates these guides. We have no trading desk, no clients and no products. We take no payment from brokers or exchanges to mention them, which is also why you will not find a "top ten platforms" table anywhere on this site.
How we work is set out in about DravoTrader and our editorial policy. The legal detail sits in the disclaimer.