The following example will show you the method and process of profit and loss calculation: Suppose the current quote EUR/USD is 1.4616/19, which means you can buy 1 at 1.4619, or sell 1 euro and buy $1.4616 at the same time.
Suppose you predict that the euro will appreciate against the dollar, so you are willing to buy EUR (and sell USD at the same time) and wait for the rise.
So you buy 100,000 euros (100,000 x 1.4619) for $146,190.
To take advantage of a 1:100 margin leverage, you need to have $1,461 in your margin account.
As you mentioned, EUR/USD rises to 1.4623/26.
To make a profit, you sell 100,000 at 1.4623 and get $146,230.
You bought 100,000 euros for $146,190, now you sell 100,000 euros and get back $146,230.
The difference between them is 4 points, or $40 ($146,190 – $146,230 = $40).
In the same example, suppose you bought 100,000 euros for $146,190 at 1.4616/19 EUR/USD.
However, this time EUR/USD fell to 1.4611/14. To cut your losses, you chose to trade at this level, that is, sell 100,000 and exchange it for $146,110.
The difference between buying 100,000 euros for $146,190 and selling 100,000 euros for $146,110 is 8 points, or $80 ($146,190 – $146,110 = $80).
Total losses: $80 Safe-haven demand pushed the dollar to a two-decade high, while recession fears in Europe dragged down the euro.
Please pay attention to the specific operation, the market is changing rapidly, investment needs to be cautious, the operation strategy is for reference only.
