As the chart shows, XAU/USD climbed above the $4,000 mark today, a move likely driven by: → Weakness in the US dollar index – or a pullback from the resistance level discussed in yesterday’s DXY analysis. → Concerns over the ongoing US government shutdown – according to media reports, one consequence has been that American […]
The post Gold Price Surges Above $4,000 appeared first on Action Forex.
As the chart shows, XAU/USD climbed above the $4,000 mark today, a move likely driven by: → Weakness in the US dollar index – or a pullback from the resistance level discussed in yesterday’s DXY analysis. → Concerns over the ongoing US government shutdown – according to media reports, one consequence has been that American […]
The post Gold Price Surges Above $4,000 appeared first on Action Forex.
Market Overview The crypto market has gained 1% over the past 24 hours, the first increase after four days of decline. The market is stabilising at levels just above $3.4 trillion, close to May’s local highs. The situation currently resembles a pause in the decline rather than a serious reversal, due to somewhat cautious sentiment […]
The post Crypto Bulls Fail to Maintain Momentum appeared first on Action Forex.
Market Overview The crypto market has gained 1% over the past 24 hours, the first increase after four days of decline. The market is stabilising at levels just above $3.4 trillion, close to May’s local highs. The situation currently resembles a pause in the decline rather than a serious reversal, due to somewhat cautious sentiment […]
The post Crypto Bulls Fail to Maintain Momentum appeared first on Action Forex.
Eurozone retail sales disappointed in September, falling -0.1% mom, missing expectations of a 0.2% gain. The decline was driven mainly by weaker spending on non-food items, which slipped -0.2%, and a sharp -1.0% drop in automotive fuel sales. Meanwhile, sales of food, drinks, and tobacco were unchanged. Across the broader EU, retail sales managed a […]
The post Eurozone retail sales slip -0.1% mom as non-food demand softens appeared first on Action Forex.
The data is released earlier than expected by the source. US-based employers announced 153,074 job cuts in October this year, which is up a whopping 175% from the 55,597 cuts announced in October 2024. Even compared to September, the number of layoffs is up a staggering 183% last month. And historically for October, this is the highest one since October 2003.
“October’s pace of job cutting was much higher than average for the month. Some industries are correcting after the hiring boom of the pandemic, but this comes as AI adoption, softening consumer and corporate spending, and rising costs drive belt-tightening and hiring freezes. Those laid off now are finding it harder to quickly secure new roles, which could further loosen the labor market.”
Looking at the details, layoffs jumped in the tech sector last month with 33,281 job cuts announced in October. That is up sharply from the 5,639 job cuts in September. Meanwhile, retailers also continue to suffer with 2,431 job cuts in October. Year-to-date though, retailers announced 88,664 job cuts, which represent a 145% increase from the 36,136 job cuts announced through October last year.
This article was written by Justin Low at investinglive.com.
This article was written by Justin Low at investinglive.com.
The five stats, what they mean, and what they do not mean
1) Balance
What it is: Your account after all closed trades, deposits, and withdrawals. Open profits or losses are not inside Balance yet.
In the example: 50,432.07 USD.
What it does not mean: It is not your real buying power while you have open trades. Think of it as yesterday’s snapshot. The market cares about Equity.
2) Equity
What it is: Real time value of your account including open trades.
Formula: Equity = Balance + Floating PnL + Swaps + Commissions
In the example: 50,336.49.
Observation: Equity is lower than Balance, so you must have a small open loss.
Calculation: 50,336.49 – 50,432.07 = -95.58. So you are down 95.58 on open trades.
What it does not mean: Equity does not tell you how much margin is committed or how close you are to auto‑closure. For that you need Margin and Margin Level.
3) Margin (sometimes called Used Margin)
What it is: The “security deposit” the broker sets aside to keep your trades open. It is based on position size, instrument, price, and leverage.
Simple idea: Bigger positions or lower leverage require higher Margin.
In the example: 12,345.16 is locked as deposit.
What it does not mean: Margin is not a fee and you do not “spend” it. You get it back when trades close or when position size shrinks.
4) Free Margin
What it is: The part of your Equity that is not tied up as Margin. It is your cushion against losses and your capacity to open more trades.
Formula: Free Margin = Equity – Margin
In the example: 50,336.49 – 12,345.16 = 37,991.33.
What it does not mean: It is not spare cash to risk casually. If Free Margin goes to zero, you hit a critical limit even if you have not closed a single losing trade.
5) Margin Level %
What it is: A health meter that compares Equity to Margin.
Formula: Margin Level % = (Equity ÷ Margin) × 100
In the example: 50,336.49 ÷ 12,345.16 × 100 ≈ 407.74%.
Broker rules: At 100%, Equity equals Margin. You usually cannot open new trades. If it falls to the broker’s Stop Out level (often around 50% but this varies), the platform starts closing positions automatically to protect the account. Always check your broker or prop firm’s exact numbers.
What it does not mean: A high Margin Level does not guarantee you are safe from large losses. It only says you have a good buffer relative to your current Margin.
How these numbers move as your open trades win or lose
Assume you do not change position size.
If your open trades gain:
Equity goes up.
Margin stays the same.
Free Margin goes up because Free Margin = Equity – Margin.
Margin Level % goes up because Equity is bigger while Margin is unchanged.
If your open trades lose:
Equity goes down.
Margin stays the same.
Free Margin goes down.
Margin Level % goes down.
Using our example:
Add 2,000 profit:
New Equity = 50,336.49 + 2,000 = 52,336.49.
New Free Margin = 52,336.49 – 12,345.16 = 39,991.33.
New Margin Level % = 52,336.49 ÷ 12,345.16 × 100 ≈ 423.94%.
Add 2,000 loss:
New Equity = 50,336.49 – 2,000 = 48,336.49.
New Free Margin = 48,336.49 – 12,345.16 = 35,991.33.
New Margin Level % ≈ 391.54%.
Key insight: with no change in position size, only Equity moves. Everything else follows from that.
How much more can your trades lose before danger
Two quick checkpoints you can read right off the numbers:
Loss to 100% Margin Level
This is exactly your Free Margin.
In the example: you can lose another 37,991.33 on the open positions before Margin Level hits 100% and new orders are blocked.
Loss to Stop Out
Suppose your broker’s Stop Out is 50% (this is only an example).
Required Equity at 50% = 0.50 × Margin = 0.50 × 12,345.16 = 6,172.58.
Additional loss to reach that Equity = 50,336.49 – 6,172.58 = 44,163.91.
At that point the platform will start closing positions automatically.
Always confirm your firm’s actual Margin Call and Stop Out percentages because they differ.
Where Margin itself comes from
For forex:
1 standard lot = 100,000 units of the base currency.
Required Margin per position ≈ Notional ÷ Leverage, converted to your account currency.
Example: 1 lot EURUSD at price 1.1000 with 1:100 leverage
Notional is 100,000 EUR, which is about 110,000 USD.
Margin ≈ 110,000 ÷ 100 = 1,100 USD.
Open a second 1‑lot trade and your Used Margin doubles to 2,200 USD. If Equity is still 10,000, Margin Level goes from about 909.09% to about 454.55%.
Notes:
Indices, metals, and energies have their own contract sizes and margin formulas.
Some brokers reduce margin on fully hedged positions. Rules vary.
What these stats tell you about your trading style and risk
Pros
They give an instant x‑ray of account health in one line.
Equity shows real time gain or pain without closing trades.
Free Margin and Margin Level tell you how much buffer you have.
Margin reveals how much leverage you are actually using.
Cons
They do not show risk per trade or where your stop is.
They do not show correlation risk. Five trades in the same direction on related pairs can behave like one big trade.
A high Margin Level can be misleading if you still carry oversized positions relative to volatility.
Hedging can keep Margin Level high while hiding large exposure.
Signals to watch
Equity far below Balance for many hours or days often means you are “holding and hoping”.
Free Margin hovering near zero suggests you are one sharp move away from a margin call.
Big swings in Margin during the day mean you are adding or cutting size frequently, which can be fine if planned, but chaotic if not.
Flat Margin with rapidly changing Equity means your size is fixed but the market is volatile.
Common confusions cleared up
No open trades: Margin is 0. Equity equals Balance. Free Margin equals Balance. Margin Level is technically undefined because you would divide by zero. MT4 or MT5 may show it as 0% or a very large number. Either way, with no used margin you are safe from a margin call.
Swap and commissions: Overnight financing and commissions reduce Equity as time passes and can drag Margin Level down even if price does not move.
Prop firm rules: Many firms enforce daily or max drawdown based on Equity, not Balance. That means open losses can violate rules even if you never close the trade. Always read the rulebook for exact definitions and reset times.
Simple safety framework you can apply today
Know your two limits
Your firm’s Margin Call % and Stop Out %.
Keep a buffer
Many cautious traders aim to keep Margin Level well above 300% and often above 500%. That is not a rule, just a sensible buffer.
Size from risk, not from free margin
Decide risk per trade first, then derive lot size. Do not fill the account because Free Margin looks large.
Use stops and accept exits
Stops cap downside and protect Margin Level. No stop means the market decides when you stop out.
Beware correlation and news
Correlated trades chew through Equity together. News can widen spreads and make Equity drop faster than expected.
Quick cheat sheet
Balance – closed results only
Equity – Balance plus real time open results
Margin – deposit held for open positions
Free Margin = Equity – Margin
Margin Level % = (Equity ÷ Margin) × 100
At 100% – usually no new trades
At Stop Out – broker auto‑closes positions, starting with the biggest loser or by its internal rule
Putting our example together one last time
Balance 50,432.07
Equity 50,336.49
Floating PnL = 50,336.49 – 50,432.07 = -95.58
Margin 12,345.16
Free Margin = 50,336.49 – 12,345.16 = 37,991.33
Margin Level % = 50,336.49 ÷ 12,345.16 × 100 ≈ 407.74%
You could lose another 37,991.33 on the open trades before reaching 100% Margin Level. If your firm’s Stop Out were 50%, auto‑closure would start around 44,163.91 more in losses.
Use this line as your dashboard. If you learn to read it quickly, you can make smarter decisions about size, risk, and when to step back. This explanation is for education only, not trading advice.
Visit investingLive.com for additional education for trading and investing. Join our Telegram channel to see how real trades are planned live, and learn how to trade through them (this is not financia advice, see them for educational purposes only. You must always do your own research and always invest and/or trade at your own ris only).
This article was written by Itai Levitan at investinglive.com.
BASELINE
The Bank of England (BoE) is expected to hold the Bank Rate steady today at 4.00% and the QT pace unchanged. The vote split is expected to be 6-3 in favour of a hold with Dhingra, Taylor and Ramsden voting for a cut (Dhingra and Taylor could vote for a 50 bps cut but it won’t be unexpected). The central bank will also release updated economic projections where a slight downward revision to inflation is expected and a new minutes format that includes individual perspectives from MPC members.
Some are expecting a surprise cut given the 25% probability from
the market pricing, but I think it’s very unlikely at this meeting as it
makes much more sense to wait another month to see the Autumn Budget
and get more data ahead of the December meeting. In fact, the BoE will see two more employment and inflation reports before the next meeting.
STATEMENT
The statement is expected to remain mostly unchanged including the key lines “a gradual and careful approach to the further withdrawal of monetary policy restraint remains appropriate” and “monetary policy is not on a pre-set path”.
ECONOMIC PROJECTIONS AND NEW MINUTES FORMAT
The economic projections are expected to show a downward revision to near term inflation forecasts given the latest data. The focus will be on the new minutes format that will include individual perspectives from MPC members. Right now, we have a dovish camp (Dhingra, Taylor and slightly less Ramsden), a moderate camp (Bailey and Breeden) and a hawkish camp (Mann, Greene, Pill and Lombardelli). These camps are based on their recent comments and history of dissents.
Market’s expectation on the December cut will be shaped by the views of the members, especially those in the moderate camp (Bailey and Breeden) as they are enough to secure a majority. In fact, today’s decision will be all about Governor Bailey’s views as Breeden always voted alongside the Governor. That also holds true for the accompanying press conference.
The market expects the central bank to open the door for a cut in December, so if we get that, it shouldn’t be surprising but it could still weigh on the pound as rate cut probabilities would increase. On the other hand, the pound could strengthen if we don’t get any signal or hint for a December cut, or even a pushback against market’s expectation.
This article was written by Giuseppe Dellamotta at investinglive.com.
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