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Are you a forex trader? Take this (Intermediate) forex trading quiz.

The ForexLive.com quiz for intermediate forex traders:

1. What is the difference between a long and short position in forex trading?

A. A long position is a trade in which a trader buys a currency with the expectation that its value will increase.

B. A short position is a trade in which a trader sells a currency with the expectation that its value will decrease.

C. A long position is a trade in which a trader sells a currency with the expectation that its value will decrease.

D. A short position is a trade in which a trader buys a currency with the expectation that its value will increase.

2. What is the difference between a currency pair’s bid and ask price?

A. The bid price is the highest price a buyer is willing to pay for a currency.

B. The ask price is the lowest price a seller is willing to accept for a currency.

C. The bid price is the lowest price a seller is willing to accept for a currency.

D. The ask price is the highest price a buyer is willing to pay for a currency.

3. How is the value of a currency determined in the forex market?

A. By the supply and demand for that currency.

B. By the central bank of the country.

C. By the stock market performance of the country.

D. By the political stability of the country.

4. What is a pip, and how is it used in forex trading?

A. A unit of measurement equal to 0.0001 of a currency’s value.

B. A type of chart used in technical analysis.

C. A type of order used to limit potential loss.

D. A type of order used to lock in profits.

5. What are the benefits and risks of using leverage in forex trading?

A. It allows for larger trades with smaller capital, with higher risk of loss.

B. It allows for smaller trades with larger capital, with lower risk of loss.

C. It allows for larger trades with larger capital, with higher risk of loss.

D. It allows for smaller trades with smaller capital, with lower risk of loss.

6. What is a forex spread, and how does it affect a trader’s potential profits?

A. The difference between the bid and ask price of a currency pair.

B. The cost of the trade, taken by the broker.

C. The profit made on the trade.

D. The loss made on the trade.

7. How do central banks influence currency values in the forex market?

A. By adjusting interest rates.

B. By purchasing or selling their own currency.

C. By implementing monetary policy.

D. By adjusting inflation rates.

8. What are the most important economic indicators for forex traders to watch (you may choose more than one answer)?

A. Gross domestic product (GDP)

B. Inflation

C. Unemployment rate

D. Balance of trade

9. How do you set stop-loss and take-profit orders in a forex trade?

A. A stop-loss order limits potential loss by closing a trade at a certain price.

B. A take-profit order locks in profits by closing a trade at a certain price.

C. Both A and B

D. None of above

10. What is the role of volatility in forex trading?

A. It determines the level of risk involved in a trade.

B. It affects the potential profit or loss on a trade.

C. It is used to measure market trends.

D. All of above

The answers to the above ForexLive.com intermediate forex traders quiz are:

  1. A

  2. A

  3. A

  4. A

  5. A

  6. B

  7. D

  8. A,B,C

  9. C

  10. D

What this forex trading quiz fun? What was your score? Kindly share your thoughts within the comments below. Which question was more of a challenge? Would you like to get some more of these quizes in the future? Thanks for your inputs.

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