Big Figure
Big Figure: An Overview
The term big figure alludes to the stem, or whole dollar value, of a price quote. It is most frequently utilized in international currency markets, where it is frequently abbreviated as "big fig." In the U.S., big figure is additionally alluded to as the "handle."
The big figure is normally discarded when traders post citations in fast-paced markets, for example, the interbank currency market. The assumption is that the full number is common information and needn't bother with to be indicated.
Grasping the Big Figure
For instance, assume that the Japanese yen is trading versus the U.S. dollar in the interbank spot market at 95.50 (bid)/95.55 (offered). The big figure here is 95, however interbank traders will quote the price as 50/55. Any participant in the spot market will realize the current big-figure level of the yen, which vacillates in value between approximately 90 to 110 yen for each dollar.
While overlooking the big figure is accepted practice in interbank and institutional markets, it is only occasionally done while dealing with retail investors.
Even in the interbank markets, traders might require explanation on the big figure assuming the exchange rate is moving quickly. That can occur, for example, during currency intercessions by a central bank.
The big figure may likewise be explained when the exchange rate approaches round numbers, like 86.00 yen or 1.3500 euros to the US dollar.
How Big Figure Trades Work
Big figure trades mean to exploit retail investors' cutoff points. With the right strategy, trading against retail forex investors can be very productive.
The market frequently trades at levels that are critical at different times, which could be due to a Fibonacci level or a trendline.
However, on occasion, it likewise could be a Forex big figure level.
Forex traders frequently see one-sided developments. That is, there are sharp intra-day price developments. As a price arrives at a critical level, traders frequently think that it can't go higher, so traders begin to take short situations close to that critical level.
This strategy closes in tears for one party or the other and ought not be embraced delicately.
A Strategy for a Big Figure Trade
The best method for making a big figure forex trade is to recognize markets that move in one heading and side. These trends assist a trader with finding focuses on that are self-evident. Different rules:
- Set orders so that you can exploit a series of quick pips, or price developments.
- Sell astutely at different stops to make one, five, or ten pips.
- Try not to stand by over 15 minutes for a trade to work. Bail out before you lose more.
This sort of trade works generally speaking and hence conveys less risk. Even on the off chance that you lose, the losses are controlled.
Features
- The big figure is quoted just when the big figure is moving fast or moving toward another level, requiring explanation.
- Currency traders are expected to know the big figure, or round sum value, of a currency they are trading.
- Retail investors will typically see the full figure, not a shortening of it.
