What Does FOREX Tick Actually Signifies?
February 14th, 2012
A lot of people ask me about what FOREX tick is, and how this trivial thing affects FOREX trading. FOREX tick isn’t that small insect that wants to suck blood. In FOREX, tick is an event, when price of a currency pair changes from A to B.A new tick takes place once the new price is registered.
FOREX market is discrete. It is influenced by discrete price changes, known as FOREX tick. There is a central computer system that functions to combine all buy orders and all sell orders, and calculates a new price based on the supply/demand rule. This computer generates FOREX ticks with price changes, and these changes are spread to all FOREX brokers all around the world.
In the event that everyone wants to sell USD, and only a few people want to purchase it, can often see on FOREX live charts that the rate of the USD goes all the way down. By its character, FX market can’t be steady. The next price of a currency pair could only be figured out when you have merged all sellers and all buyers.
Some Foreign currency trading strategies are usually based on FOREX ticks. Gap trading for example is based on ticks. Many scalping strategies are based on ticks.
You can often predict the next tick movement and make a few pips of profit every few minutes by looking at the tick chart.
You may also watch my video tutorial by clicking on the button below for more details on how exactly it is done.
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