The OANDA fxTrade trading platform automates the process for closing a position for you. Trading in the Spot Forex Market.

Putting It All Together. This is for general information purposes only - Examples shown are for illustrative purposes and may not reflect current prices from OANDA.

How to Close a Long Position in Forex | OANDA

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Download our Mobile Apps Currency Converter App Forex Trade App. Currency Trading Conventions — What You Need to Know Before Trading. Overview Active trades are referred to as open positions.

Open positions remain subject to fluctuations in the exchange rate. Open positions are closed by entering into a trade that takes the opposite position to the original trade. The net effect is to bring the total amount for the currency pair derivative back to zero.

Only when you close a position do you actually realize the gains or losses for the trade, thereby affecting the actual cash balance of your account. Closing a Long Position To close a long position, you must sell an equal amount of the same currency pair derivative to reduce your long position to zero.

If you receive more when you sell than you paid to buy the order, you earn a profit. If you receive less, you realize a loss. Closing a Short Position A short position is the opposite of a long position — think of it as holding a negative amount of a currency pair derivative.

In order to close a short position, you need to buy enough of the currency pair derivative to bring your position back to zero. If you can buy this back for less than you earned when you sold it originally, the difference is retained as profit.

Partial Position Close It is possible to partially close an open position by only selling or buying enough to partly offset the open position. Trading in the Spot Forex Market 3. Losses can exceed investment.