A beginner's guide to Forex signals

A trading signal is a trade idea. It usually tells you which currency pair to look at, whether to buy or sell, and the price levels to use. This guide explains the terms used by the Signal Bot in 2MUCH GLOBAL UPDATE so you can read them correctly.

Risk warning: Forex and similar markets carry a high risk. You can lose some or all of your money. Signals are for information only and are not financial advice. Never trade money you cannot afford to lose.

Your signal (valid for 5 minutes)

For information only. Not financial advice.

The parts of a signal

Pair and direction

The pair is what you trade, for example EUR/USD or XAU/USD (gold). Buy means you expect the price to rise. Sell means you expect it to fall.

Entry

The price at which the trade is opened. Markets move fast, so a signal may be valid only near its entry price.

Stop loss (SL)

The price at which the trade is closed automatically if the market goes against you. It limits how much you can lose on one trade.

Take profit (TP1, TP2, TP3)

Price targets where you close all or part of the trade to lock in profit. Many traders close a part at TP1, move the stop loss to the entry price, and let the rest run to TP2 and TP3.

Basic risk management

• Risk a small part of your account on each trade. Many traders use 1% to 2%.
• Always use a stop loss. Do not move it further away because you hope the market will turn.
• Do not over-trade. More trades do not mean more profit.
• Start on a demo account before you use real money.
• Keep a journal of your trades so you can learn from mistakes.

Example (for learning only)

Suppose a signal says: Buy EUR/USD, Entry 1.1000, SL 1.0950, TP1 1.1050, TP2 1.1100. The stop loss is 50 pips below the entry and TP1 is 50 pips above it. That is a 1:1 reward-to-risk at TP1 and 1:2 at TP2. This example uses made-up prices and is not a real signal.

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