Position

A position is an open trade in the market. When you buy or sell a currency pair, you establish a position. You hold a long position if you bought (expecting price to rise) or a short position if you sold (expecting price to fall). The position remains open until you close it or get stopped out.

Each position has several components: the instrument (which pair), the direction (long or short), the size (how many lots), the entry price, and optionally, attached stop-loss and take-profit orders. Your open positions collectively determine your market exposure and risk profile at any given moment.

Managing positions is where theory meets reality. Deciding when to exit — whether to take partial profits, move your stop to breakeven, or let the trade run — is one of the hardest aspects of trading. Many traders find that their entry strategy is fine but their position management costs them money through premature exits or letting winners turn into losers.