An open trade in forex is a position that has been entered but not yet closed. It represents a contract between a trader and a broker to buy or sell a specific currency pair at a specific price. Open trades can be either long or short, depending on whether the trader is expecting the value of the currency pair to rise or fall.
Open trades are typically displayed in a trader’s account as a list of positions, each with its own entry price, stop loss level, and take profit level. The value of an open trade can fluctuate as the market price of the currency pair changes.
Traders can close open trades at any time by placing an opposing order to the original trade. For example, if a trader has entered a long position by buying a currency pair, they can close the trade by selling the same currency pair. Closing a trade at a price that is higher than the entry price results in a profit, while closing a trade at a price that is lower than the entry price results in a loss.
Open trades can be managed using a variety of trading strategies, including trend following, scalping, and hedging. Traders can also use stop loss and take profit orders to limit their risk and lock in profits.