Common Pitfalls in A Forex Trading Strategy

Avoiding Common Pitfalls in A Forex Trading Strategy

by Tyler Green

Forex Trading Strategy: Getting The Most Out of It

The foreign exchange currency market is a complex international marketplace where currencies are traded just like stocks and bonds. Every currencies' economies are diverse, making the Forex market, or just Forex, highly complicated. To study Forex, an adaptable trading system and platform is a must. Analyzing and researching on the various world economies can be tedious and time consuming. It is easier to applying proven warnings and guidelines called market indicators on Forex trading systems. This way, it's easier to find movements and trends on the many currencies. For people who wish to study Forex trading, here are some principles that could help:

- You can maintain profits and control losses with the correct stop-loss orders. - Let a high-earning pair run. If not, it is advisable to cut your losses and don't think that it will improve and turn profitable. - Market trends have their rise and fall. Market trends are usually changing across various pairs. At times it takes a bit of looking at the market differentlyin a different way. - Standing aside is a choice you can take. You don't always have to trade or have a pair. - Don't pick tops and bottoms; instead, trade with the trends. Apply tested market indicators as a fraction of your Forex trading strategy to search for trends and trade on those. forex trading

Using a Forex trading system based on market trends and indicators are so much easier than trying to stay on top of all the economies included. Forex is a complex market, and these are only some strategies to help you trade. forex trading

Forex Trading Info - Getting the Right Info For Forex Success

Forex Trading Info - Getting the Right Info For Forex Success

by Kelly Price

The fact is anyone can learn forex trading and get the right forex trading info to success but you need to get the right in of succeed. It's a fact that 95% of traders fail because they simply fall prey to common myths, or don't get the right forex education. forex trading

The first point to make is there are no secrets to successful trading it's simply based upon a logical, robust method which you understand can have confidence in and apply with discipline. forex trading

Forex trading success is very much a personal affair and only you can give yourself success. Many traders make the mistake of trying to follow other traders. forex trading

The problem is they don't understand the logic or method and therefore don't have confidence in it and as soon as a few losses come, discipline goes out of the window and they lose. forex trading

If you want to start trading then the simplest and most time efficient way to do it is to use forex charts and technical analysis to time your trading signals. forex trading

All the information you need is available on the net and you can get it for free.

A Great Methodology That Works

The hard bit is combining the indicators to generate the signal. The easiest way to do this is to use a breakout methodology. This methodology is simple to understand, timeless and works and you only need to understand the concept of support and resistance. You then need some momentum indicators to help you gauge the strength of the breakout and use them for timing. forex trading

The above is a simple robust method which can and will, make you big gains and we have discussed all the above in our other articles.

Should You Pay for Advice?

There is a lot of forex trading info for sale, most is junk and normally tries to sell you a mechanical trading system, with a simulated track record of gains - avoid them. Also avoid any vendor who sells material that stresses the following:

- Day trading is a good way to make money - You can predict forex prices with scientific accuracy - They have secrets they will reveal - You can make regular profits

All the above are myths and are simply designed to appeal to naivety and greed.

If you want to pay for forex trading info look for - sensible advice, the logic of the forex trading system is revealed and you have some sort of money back guarantee.

Information From the Best

If you want some great advice from traders who have walked the walk then go to your online bookstore and you can get some wisdom from some of the greatest traders of all time. Two great books to start with are "Way of the Turtle" by Curtis Faith and Market Wizards by Jack Shwager. These will give you an insight into what makes a great trader. forex trading

The Combination for Currency Trading Success

Forex trading is a combination of the right knowledge, confidence in it and the discipline to apply it. This is why you can't simply follow someone else blindly - you need to have confidence in what you are doing to have the all important trait of discipline. forex trading

If you do your homework and get the right forex trading info, avoid the myths and understand success comes from within, you could soon be trading and enjoying currency trading success. forex trading

Forex Trading - 3 Simple Tips for Triple Digit Profits

Forex Trading - 3 Simple Tips for Triple Digit Profits

by Kelly Price

If you incorporate these two tips in your forex trading strategy then you can increase your forex profits dramatically and really supercharge your gains so here they are. The first one is.

1. Reduce Your Trading Frequency

Many traders think the more they trade the more their profit potential will be and they don't like not being in the market in case they miss a big move. They end up trading to much and taking low odds trades and lose. forex trading

You don't get rewarded for how often you trade - you get rewarded for being right with your trading signal and that's it. forex trading

I know trades who trade only a few times a year and make triple digit profits.

Their not interested in the buzz of trading, just taking trades they know will be big trends they can hold and make money with. forex trading

2. Do Not Diversify!

You will here a lot about not putting your eggs all in one basket as a way to reduce risk but there is a problem - it dilutes profit potential and most traders who start trading in forex simply don't have big enough accounts to diversify. forex trading

When you see a high odds trade on your forex trading system then you need to focus on it and not be tempted take other marginal trades for the sake of it, this leads onto the next point. forex trading

3. Load the Trade Up

Another common wisdom is only risk 2% per trade - but for most forex traders this is too little and simply ensures they get stopped out by normal volatility. forex trading

Let's say you are trading a small account of $3,000, risking 2%, that's just $60!

You won't make much risking that. forex trading

Risk and reward go hand in hand, so the more you risk the more you can make.

This doesn't mean that you have to be rash but you need to take calculated risks at the right time and if you believe in a trade load it up. forex trading

If you have a small account then you should be risking between 10 - 20% on these trades. The high odds trades don't come around often, so you need to milk them for all there worth.

Finally....

If you don't like risk or try and restrict it to much, you will simply consign yourself to failure. You also need to have the courage to hit trades hard at the right time and be patient to wait for the high odds set ups to emerge. forex trading

If you are a trader who wants to make more money from their trading then the above 3 tips will help you do so and enjoy currency trading success. forex trading

Success In Forex Trading Markets

Success In Forex Trading Markets

by Eric Long

The more you know about them, the more data you have to analyze to spot the trends, which will increase your chances of success. forex trading
The foreign currency market is one of the most exciting attractive and lucrative markets in the world, but it is also extremely fast moving and volatile. While you can make tremendous profits, you can also make substantial losses if you do not have a very clearly defined game plan. At the heart of Forex trading is a wealth of information which has to be not only constantly updated but which also has to be accurate. forex trading

The principle behind technical analysis is simply that, while political, economic and social factors do drive the forex market, it is not necessary to study them in depth because history repeats itself and these factors in whatever combination you choose have occurred time and again in the past so their affect can be seen by simply studying the historical pattern of currency movements. Fundamental analysis thus looks at political events and economic data such as inflation, interest rates and trade figures, as well as social data such as employment rates.

Too often you will see sites that are promoting ways in which you can get rich through Forex trading as long as you purchase their book for $100. The prices vary but one thing is certain the beginner must study the market before investing any significant money. Technical analysis holds that prices follow trends and that markets possess clearly identifiable patterns which can be recognized if you know what you are looking for. forex trading

Perhaps one area of general agreement however is that analysis of a country's balance of payments is crucial to the success of fundamental analysis. The balance of payments is important because it reflects the flow of currency in and out of a country and a situation in which money is flowing into a country faster than it is flowing out, or vice versa, will clearly affect currency prices. For this reason the very first thing that any novice forex trader needs to do is to sit down, study the foreign exchange markets carefully and learn the ins and outs of trading before putting any money at risk. forex trading

Both knowledge and experience play an important role in technical analysis but here it is a case of knowledge and experience of not just the patterns in the market but of working with the barrage of tools which are know available to the technical analyst. In other words an analysis of, for example, the effect that rising or falling interest rates have had on currency prices in the past is used to predict the effect that a rise or fall in rates today will have. forex trading

Today's forex traders have the option to abandon fundamental analysis in favour of technical analysis. Perhaps one area of general agreement however is that analysis of a country's balance of payments is crucial to the success of fundamental analysis. Historical data is then used as the basis for predicting movements in the light of current figures. Analyzing just how forex prices will be affected is of course something which is hotly debated by fundamental analysts. forex trading

Accordingly, the main tool of the technical analyst is the chart, or more accurately a series of charts, which provides a graphical representation of the market over time. Your broker will make his profit from the 'spread' on each trade, which is the difference between the buying and selling price of a currency pair and is a subject all of its own. Both technical and fundamental analyses are of course not in themselves trading strategies but are the foundation on which you will need to build your trading strategy. forex trading

Unfortunately a lot of people starting out in Forex trading have often heard that you can make good money through day trading. Look at the various tools and systems that are available and soon you will discover that you are able to trade on the markets much more easily after just a couple of weeks. So if you do not want to end up in the same situation as many before you, here are some tips in relation to Forex currency trading online that can help you gain more and lose less. forex trading

The more you know about them, the more data you have to analyze and spot trends, which will increase your chances of success. Although this is easier said than done, you can't get greedy or nervous and ignore what it tells you. Simple Forex trading systems work much better than the more complicated types. As like many before you, when you first start trading on the Forex market you will soon realize that a lot of the traders lose money rather than gain. If you include these few tips to any plan you are devising for your Forex currency online trading then you should soon be on your way to making some decent money. forex trading

Forex Beginner Systems: A Step-by-Step Guide to Trading Profit

Forex Beginner Systems: A Step-by-Step Guide to Trading Profit

by Joseph Ward

This forex beginner systems article is a comprehensive guide to the steps needed in devising a forex trading system as a beginner. Knowing which way to jump with all the information floating around can be a daunting proposition; so having a step-by-step guide by a successful experienced (and humble: lol) trader is obviously a great start. There aren't any in depth explanations here as the purpose is to highlight the areas which require further investigation, and in what order of importance. I have articles specific to each category on my website which I will link to at the bottom of the page. Anyhow, follow through with each of these steps and you will be well on the way to forex trading profit. forex trading
The main steps are:
1.) Get background information on what forex trading entails. forex trading
2.) Learn how to manage risk and size positions correctly.
3.) Find a strategy you are comfortable with.
4.) Test your strategy.
5.) Interpret the numbers.
6.) Find a broker.
7.) Rake in the cash!

Basics:
First of all, with forex beginner systems, it is important to know just what you are getting into. Forex trading is just like any other business. You wouldn't go off and try to build houses without reading a book or getting some lessons now would you? Constructing systems is much the same. Without any knowledge of the market you are essentially building a "house of cards". You don't need a Phd in macro-economics, but a solid knowledge base will only aid in your trading decisions and help ease your mind throughout the entire process. forex trading


Risk Management:
The next thing to learn is how to manage risk and size positions. These factors should be the cornerstones of any system. In essence: you need to know how much to risk losing on each trade. People often make the mistake of ignoring this factor; that's why over 90% of traders fail. Think of it in terms of being a gambler or being a casino; we know who always wins right? Do your due diligence on risk management and position sizing and you will be well on the way to becoming one of the 10% of successful traders. forex trading

Strategies:
Once you understand the numbers a little better you can look at specific strategies to trade. Forex beginner systems should be quite simple. As with many other things; simple can also be very effective. I have found that trend trading and swing trading in particular can be very simple and also very effective. The main thing though, is that you feel comfortable trading a strategy. Psychology plays a large part in forex trading too, so having a simple yet effective strategy is often the best. It's a case of K.I.S.S. (keep it simple stupid!). forex trading


Testing:
The next aspect of creating forex beginner systems is testing. Testing your system is all important in knowing if you will turn a profit or not. Don't "go off half cocked"; you may wind up with a "blown up" trading account. It's a step closer to being a "casino" and another step away from being a "gambler". To add further perspective; just imagine if boeing didn't test their planes before they used them..... Would you be getting on one? I didn't think so! It's much the same with trading; test your hypotheses and make sure they work. forex trading


Analysis:
Analyzing the results of these tests is the next thing to do. Anyone can see if a system will be relatively profitable from the results of testing. The hard part comes with understanding how to interpret the results and how they will effect your trading in real time. Analyzing the results and making necessary changes to your forex beginner systems will also likely make you substantially more profitable. There is no end to what can be done with statistics. Again let's look at our jet-plane analogy. From flying the plane we know it doesn't crash. But how much fuel per mile did it use? How much will we need to fly from our place to a nice island in the Maldives? How can we get their faster or without using as much fuel. You get it? Knowing how to get there is one thing; but getting there the cheapest and fastest way possible is harder. forex trading


Brokers:
Now it's time to find a broker to trade your forex beginner systems with. Brokers offer free trial accounts with play money to check out their wares. By all means take advantage of these offers. Also, you should be aware of some of the different types of brokers and the features they offer. This is important as well. Think of it as choosing to fly "Econo-miser" or "Champagne" airways. forex trading


Conclusion:
Now you should be all geared up with some shiny new forex beginner systems if you have investigated all these things thoroughly. If you're still not sure, there is loads more information on my site and others. There are loads of people researching new ways to make money in the currency markets, so please, check the web regularly and see what else they have found. Some offer their information free (like me) and others charge for their info. Do not be too tight with the purse strings though; as one profitable trade can often see an item paid for many times over. Now off you go and rake in some of that cash! forex trading

How to Use a Forex Trading Signal

How to Use a Forex Trading Signal

by Ryan Lee

Forex trading signals are triggered when technical conditions signal a good trading opportunity. Email and SMS (text message) are popular delivery methods for forex trading signal alerts, but Web-based option can often be best if you're at your PC when the signal emerges. forex trading
For example, some forex trading signal services have automatic pop-up software to indicate the perfect entry (or exit) point of a trade. These will often include candlestick currency charts that may flash or blink so long as the entry (or exit) point remains valid. If you trust the service provider and you don't have any conflicting information telling you the trade is bad, right then is the perfect time to execute the trade. forex trading

But other forex trading services specialize in catering to traders who have medium- or long-term strategies, rather than short-term. A medium- or long-term trade may have a forex trading signal that remains valid for an entire day (or longer), so for traders specializing in longer-duration trades, these forex trading signals services can be delivered via email or SMS at no detriment. forex trading

Another way to use signals is to pair them with a service that automatically executes your trades. This can be a risky prospect for traders who prefer to use forex trading signals as mere recommendations and like to do their own homework before making their trades, and such services are better for short-term traders who don't have time to do their own analysis before pulling the trigger on a trade, anyway. The good news is that, thanks to modern technology, forex traders have the option to choose which style of trading -- and which style of corresponding forex trading signals -- works best for them. forex trading

Some forex trading signal services allow you to sign up for a free trial; usually consisting of ten or fourteen days. Take advantage of these free trials to make sure your style of trading is compatible with their forex trading signals. If you are new to the forex market, then you can sign up for a free trial and use the signals with a free "practice" account in which you trade "demo money". This way you can learn how to use signals without undue risk. forex trading

But ultimately, if you want to make money in the forex market, you're going to have to risk money in a real account, and unless you are incredibly good (or lucky), you're probably also going to have to spend money on a good forex trading signal service. The forex market is not for passive investors -- it is for active traders who wish to rely solely on their wits... And a little help from forex trading signals, of course! forex trading

Forex Trading Not Only For Banks and Investment Houses

Forex Trading Not Only For Banks and Investment Houses

by Ove Nordkvist

Forex trading online is a booming business and a lot of people make a good living from it. Forex trading is a very interesting business idea, simply because it allows people from all over the world the chance to trade and strike it rich in a market that has enormous liquidity. Forex trading is a serious business and it is vitally important that you gain proper education, before committing your hard earned money to the markets. forex trading
Online forex trading are spreading like wildfire as people are looking to generate income. Online currency trading allows you to make transactions any time of the day, at your own convenience. The reason why this market has grown much more than other financial markets, is because of the rise in the number of traders working online rather than using the more old fashioned method of trading by the phone. forex trading

Systems for Forex trading are methods that makes it possible to verify entry and exit points, based on parameters, which have been validated by historical examination, on quantifiable data. Whether you are a smalltrader with as little as $200 to start with or a bigger investor wanting to trade multiple contracts, you'll need to have a reliable trading system. forex trading

To be able to trade with profit, you must be able to define and choose low risk entry points. A lack of self discipline in following a well thought out trading strategy will lead to losses. Now, with the proper education and big amount of self discipline, this is a striking and profitable Internet investing opportunity. You can trade from your PC or connected laptop from any place in any country in the world. forex trading

There is a wide variety of online training available. Therefore You'll be able to get educated from the comfort of your own home. Now, if you're interested in forex trading, you must start off by getting some good forex training. Make sure that your education includes currency simulation training, to help you understand the process and to minimize mistakes when you switch to the real deal. forex trading

Forex trading is an extremely lucrative, yet volatile and therefor risky market. It is very appealing to the online trading newcomer as it is a controlled environment, and quite simple to understand. Currency trading is no longer the private playground of the banks and investment houses. Forex trading is one of todays hottest business opportunities. forex trading

Forex Trading - Fascinating and Challenging, But Not Effortless

Forex Trading - Fascinating and Challenging, But Not Effortless

by Matthias Lutz

Forex is one of the names that presenting the trading of the world's currencies. Other manes are Forex Exchange or FX. The trading volume in Forex market is the biggest in the world, 1.5 trillion USD a day. Forex trading is performed when two counterparts are ready and willing to make a currency trade. Trading can be done all over the world by using networks.
A major advantage of Forex trading over other markets is the ability to trade 24 hours a day. The main centers are in Frankfurt, New York, London, Tokyo and Sydney. The market is constantly moving and creating trading opportunities all the time. forex trading

Check the review of the decent 5ema Forex Trading System course. forex trading

The currencies movements can be naturally caused due to supply and demand, but more likely by geopolitics news/changes, world financial reports, nature disasters, other global events and more. A single event can cause a dramatic currency change. forex trading

Since Forex trading is a very dynamic market it is important to have money and risk management system that helps to control the outcomes. Using this system you should be able to predict ranges for gains and losses, know what the variables that affect your investments are, protect unwelcome outcomes and manage the a risk profile strategy.

Check the review of the new decent Profitable Trend Forex System course. forex trading

There are important terms to learn in Forex trading. Besides the following two basic terms you should know what is Appreciation, Base currency, Bear, Bull, Cross, Long, Liquid, Margin, Position and more. Spread - The difference between the bid rate to the ask rate. Pips - A pip is the smallest increment in any currency pair. forex trading

Forex trading earning potential is great and you can take an action and start earning money, but you must know exactly what do and how to do it correctly. There are so many Forex guides and courses, but only few are comprehensive, successful with unlimited support and updates. forex trading

Mobile Trading For Profit in Forex

Mobile Trading For Profit in Forex

by Paul Bryan

Forex Mobile Trading is a unique service that has been developed to allow the investors and traders worldwide to trade and manage their accounts from anywhere in the world using their mobile handsets or PDAs. Forex mobile trading software works with the same efficiency as any other automated forex trading stations. forex trading
Forex mobile trading software enables investors to:

· trade Forex with the same ease as would have done with desktop or laptop computers. · view real time prices, access live charts with technical indicators. · view a real time account summary and historical account information. · have a sound alert notifying them the changes in the market. · receive technical analysis and updates from the market. forex trading

The forex mobile trading software includes all necessary components for brokerage services via internet including the operations of the back office and dealing desk. Once the forex mobile trading software is installed on your PDA or communicator, you can get quotes and news in the real-time mode and can perform all usual trade operations. The trader will also be able to control and manage open positions and pending orders. forex trading

In order to make trading decisions, you need prompt and reliable information. The forex mobile trading software is the ideal solution as now one can analyze and trade in forex using live real time quotes from anywhere in the world and when 'on the go'. forex trading

Forex mobile trading software needs specific computer operating system and the latest technology based mobile sets. To install the forex mobile trading software, you will have to download it in your PDA or any other bluetooth enabled mobile set. Once installed, the mobile set works exactly as your desktop or laptop personal computer. Many companies now offer the software with the facility of free testing period. After that you simply register and start working if you find the software to be satisfactory. forex trading

The next step will be to open an account using the forex mobile trading software. For example, you can open a demo accounts or a real account. Demo accounts will enable you to work under training conditions, without real money. But you will be allowed to work and test trading strategy. forex trading

With a real account, your forex mobile trading software establishes a connection between the server of the agency and your mobile set. You can manage the trade account and can accesses the market information. forex trading

These forex mobile trading software are safe and secured. As the systems work with password protection and necessary firewall techniques, your personal data is protected and safe. The forex mobile trading software ensures security of trading as well. Advanced security systems based on digital signature algorithm of RSA are even smarter. It provides nearly full proof security system based on electronic digital signatures. forex trading

With advanced features of your mobile set, you can even customize the forex mobile trading software and the appearance as well. For efficient and faster operations, you can decide on a suitable number of popup at any point of time. To use the mobile as a phone you can simply disable the forex mobile trading software and again enable it once the call is over. So the forex mobile trading software is the perfect mobile solutions for your forex trading in this fast paced mobile life. forex trading

Forex E-Book Of Trading Strategies

Forex E-Book Of Trading Strategies

by Rick Williamson

With Forex trading, you can be in charge of your finances. It has the reputation for being the largest market in the world, and the cost at the beginning is also low. This industry is tuned to several billions of dollars, and there is the opportunity to earn a lot of money by a few hours. All one needs to do this, is the determination and an Internet connection.
When it comes to Forex trades, one must keep growing with learning about methods to make more money. There are excellent Forex e-books that deal with trading strategies, and which are highly informative for the growth of an individual in this industry. There are several Forex trading strategies that are available in the e-book, which will take individuals to greater heights. forex trading

The e-book states several methods that can be followed, and not one of them has false claims. Each one has been proved, and the methods will allow you to maintain a consistent trading record. This e-book can be vouched for, because a professional team has taken effort into researching the best ways to optimize the trading strategies. forex trading

If you are the one who has lost money in this business, and needs professional help with what you want, there is no better place to look for plans, other than this Forex e-book. In any business, one needs determination and focus to succeed, and so it is with this one. The loss must not stop you from trying these strategies to get where you want to get. forex trading

With the help of this e-book, you will be able to understand when and how to enter the market, and also when you need to find exits. This has to be done at the time, when you think you are about to lose money. These Forex trading strategies have been coined in such a way, that a trader needs to spend only a few hours gaining access to success. forex trading

Not only is the e-book charted out with simple steps, it is also a moral boost for those who have lost money. It allows the trader to understand the market better. Once these strategies are understood, one can make sure that he is never going to lose money in this business again. Once you understand the methods, you will also know when you need to enter a trade. forex trading

This way, you will not be left out from the crowd. forex trading

Forex Trading and Money Management

Forex Trading and Money Management

by Andrew Daigle

As part of your Forex trading strategy, you must be able to manage the money that you invest in trades and determine when it is advantageous to enter or exit a trade. Most trading strategies are good for determining when a trade should be entered, but not all strategies establish an exit. If your Forex trading strategy does not provide exit points, you will still need some method of determining when to exit.

Profit and Loss (P/L) - Forex trading systems provide one of the easiest forms of executing and monitoring profit and loss (P/L) in investments. P/Ls in the spot market are generally measured in decimal units. A calculation of the long and short position for a leveraged currency pair will easily provide you with the amount of profit and the amount of loss.

Gains to Losses - You also need a method of predicting the chance of profiting from your trades in order to decide how much money to invest in your Forex trading strategy. By calculating the ratio of gains to losses you will be able to determine if your trades are providing a higher percentage of gains than losses. If your trades are gaining then you need not invest more money into already winning trades.

Risks to Reward - Since Forex trading systems involve risk, you need to able to measure the risk taken as compared to reward received. A risk/reward ratio may be determined by dividing a take-profit spread by a corresponding stop-limit spread. No rollover or interest rate differential is required. You are cautioned against allocating more than 10% of your total investment funds into a single trade as either margin or risk. Your Forex trading techniques should include enough funds to allow you to engage in multiple trades. If some trades result in loss, those losses have the potential to be recovered with other winning trades. If half or more of your trades result in loss, you need to analyze and adjust your Forex trading strategy.

Limiting Losses - You may limit the amount of loss by adjusting take-profit and stop-limit orders relative to the entry market price. By raising stop-limit orders and lowering take-profit orders, you may reduce loss potential. If prices create adverse results, you may eliminate any further loss by manually liquidating the trade. If price moves are favorable, you may increase your limits. In some instances it may be advantageous to raise the stop-limit order above the market entry price. This guarantees a profit of at least the originally targeted price and at most, the newly established price.

If you have taken a long position, you should avoid lowering stop-limit orders and accept a loss or trade a different currency pair. Take-profit orders should only be lowered in long positions if a reversal is anticipated. Otherwise, you should liquidate. If you have taken a short position, you should avoid increasing stop-limit orders and only increase take-profit orders in anticipation of a reversal. Many large losses are due to moving and removing stop-loss orders. The Forex trading strategy for uncertain traders should be to liquidate trades for small losses or small profits rather than hanging around to suffer a greater loss.

With most Forex strategies, stop-loss orders are typically placed below and above previous highs or lows. However, you may find it advantageous to set your stops according to market volatility. Using charts of recent currency pairs you should be able to gauge shifts in volatility. This information could then be used to set stops and price objectives. This method may also be used to establish entry points in the market.

Forex Charts the Basics You Need To Know

Forex Charts the Basics You Need To Know

by monica hendrix

Here we are going to give you an introduction to the basics of forex charting and how to use them to successfully catch and hold forex trends for big profits.

Forex markets (or any financial market for that matter) move to this basic equation:

Fundamentals + Investors Perception of them = Market price

The fundamentals are the supply and demand facts and we all see them but being humans we all draw our own subjective judgements on what they mean and we are not just influenced by logic - but the emotions of greed and fear as well.

It's very difficult to trade the fundamentals, because all the facts are instantly known and discounted in the price and of course you never quite know how humans are going to view them.

A basic premise of using forex charts is to simply assume that all fundamentals are instantly discounted in the price and no study of them is needed - while this sounds essentially simple (and it is), it means a chartist is not interested in knowing them - he is only interested in price movement generated by them and investor psychology.

How and where prices move is decided not by the facts or supply and demand situation but is down to how investors as a whole see them, this then becomes the market price.

A basic foundation of forex technical analysis is that history repeats.

Why?

Because human nature is constant it will be reflected in forex charts as repetitive price patterns that can be traded for profit.

In essence forex charts allow us to study the fundamentals and investor psychology all at once - a technical analyst is not interested in how or why prices move - he just studies the charts and wants to make money when they do.

Another foundation of technical analysis is that a trend in motion is likely to persist and the aim is to lock into these trends and hold them for profit.

The fact is anyone with the right forex education can make money using forex charts but it's an art not a science and you need to learn a method based upon sound logic.

Many forex traders base their currency trading systems on trying to predict forex prices but this is wrong.

Why?

Because it's simply another word for hoping and guessing and that won't get you far in any walk of life and that includes forex trading.

Forex charting is a game of odds - not certainties and you need to keep this in mind while chart patterns do repeat they do not move to a scientific theory.

If you want to learn currency trading and be successful then charting is a quick simple and profitable method and takes very little time. You can learn it in a few weeks and you can then cover your currencies daily in around 30 minutes and that's it.

Forex charting basics are enclosed but you will now say - I like the idea how do I use them for profit? That is the subject of part 2 of this article series.

Forex Education: Why Retail Traders Fail

Forex Education: Why Retail Traders Fail

by Harold Hsu

There are many reasons why Forex traders often wipe out their accounts. In fact, there are so many factors that cause Forex traders to lose money, that only 10% of all traders are consistently profitable.

Almost all of these loss-causing factors, however, can be generally narrowed down to 4 basic reasons:

1. Not understanding what the Forex market is about

Many retail traders make the mistake of treating the currency markets the same way they treat other financial markets. I knew of a well-performing stock trader that lost more than $50,000 because he traded Forex the same way he traded stocks.

Even though the trading charts used in the stock and currency markets are similar (or even identical), the underlying natures of both markets are vastly different. To be able to trade profitably in the Forex market, you’ll have to first understand its characteristics and nature: don’t think that Forex trading is the same as other forms of trading!

2. Not understanding your position in the Forex market

There are many players in the Forex market, and each type of trader has different strengths and weaknesses. Many losing traders don’t realize that the trading strategies of one type of trader won’t work for the other types. For example, the trading strategies used by institutional traders will fail miserably for retail traders. This is because the strategies used by institutional traders are based on their strengths and weaknesses, which are very different from that of retail traders.

3. Not understanding the effects of greed, fear, impatience and pride on traders

This point is self-explanatory. Instead of using this knowledge as a tool to trade well, losing traders often fall into the habit of suffering from these emotional effects instead.

4. Listening to bad trading advice

It’s easy to find Forex trading information and advice on the internet today.

Unfortunately, most of this advice is provided by people who aren’t profitable traders themselves. While their advice is generally well-intentioned, the fact is that much of it is pure hogwash and cannot be practically implemented into any sustainable trading strategy. Be careful about where you learn about Forex trading from.

Forex Prices - Factors That Determine Price Movement

Forex Prices - Factors That Determine Price Movement

by kelly price

If you want to be successful at forex trading then you need to know how and why prices move - many traders think this is obvious but its not and that's why 95% of traders lose. Here we will look at the factors that move currency markets and how you can profit.

First let's start with a simple equation:

Supply and Demand Fundamentals + Investor Perception = Price

While the above equation is simple enough, it's deceptive and most traders fail to understand its significance, when they learn forex trading.

Fundamentals

These are the supply and demand facts and they help move price but the person studying these facts has a problem - while the facts are there for all to see, we all see them differently and draw our own conclusions about what they mean.

Our actions combined with millions of other traders, creates the price.

The facts are there for all traders to see but we all draw different conclusions that's why the facts alone are not enough to help you trade.

It's a fact that markets collapse when they are most bullish and rally when they are at their most bearish - this is investor psychology at work.

Investor Perception

Of the facts creates the price and we are not creatures of logic, we are creatures of emotion and these are reflected in the price.

It's a fact that greed and fear dominate investors and these emotions cause price spikes away from fair value. These price spikes never last long and are easy to see on any forex chart and they never last long and return to fair value.

So what do you need to understand in terms of the above, in terms of your forex education? Here are the salient points:

- Never predict price movement as humans behaviour cannot be predicted - Trading fundamentals by themselves is hard as its only half the equation - Trading is a game of odds and you need to get the odds in your favour to win

Now you know the above how do you get a forex trading strategy for currency trading success?

The simplest way is to base your forex trading strategy on forex technical analysis.

Not only does it take into account the fundamentals it also takes into account how investors perceive them.

Technical analysis simply assumes that all fundamentals will be quickly be reflected in price action and in today's world of instant communications and online trading, this is truer than ever before.

Technical analysis more importantly, takes into account how investors perceive the fundamentals. While prices do not move to a scientific theory, human nature is constant and this is reflected in repetitive price patterns on any forex chart.

While charting is not a science, certain formations that present themselves do offer trades where you can put the odds in your favour, with a robust currency trading system.

You won't win every trade - but if you trade the odds, you will win more than you lose and pile up huge long term profits.

Most novice traders when they try and learn currency exchange don't understand the way prices really move and think they can predict, trade news stories and use scientific theories and they lose. To win at forex trading the best way to trade is to trade the reality of forex prices changes - without predicting, focus on the odds and assume any trade can go wrong.

The equation for forex price movement is essentially simple but deceptive.

Now you know how and why forex prices really move, you can build a forex trading system to help you enjoy currency trading success.

Forex Trading Strategies for Profit for Profit

Forex Trading Strategies for Profit for Profit

by kelly price

There are many different forex trading strategies as there are many different ways of achieving forex trading success but if you are devising one for yourself there are some key elements the best forex trading strategies incorporate and that the subject of this article.

1. They are Simple

There is a big myth that science can help you trade and the buzz words are neural networks and artificial intelligence systems and other complicated trading systems. The problem is complex forex trading systems with to many inputs mean there are more elements to break and these systems fail in real time.

The base of your forex trading strategy should be a simple trading system that will be robust in the face of ever changing brutal market conditions.

2. Objectivity

The best forex trading strategies tend to be based around objective criteria and rules that are clear and do not have too much subjectivity. For example, a moving average cross over is an objective forex trading signal - Elliot wave and cycles are not and involve subjectivity.

By keeping your strategy objective rather than subjective, you will keep your emotions out and stay disciplined.

3. Trade Valid Data

If your forex trading strategy involves technical analysis and forex charting then you need to use valid data. Forex day trading systems don't work, as volatility in short time frames is random and prices can and do go anywhere. You need to get the odds on your side and that means trading longer term - swing trading or long term trend following.

4. Breakouts

Most of the top trading systems use breakout methodology, as it's a fact most major moves start from new market highs not market lows.

Traders who want to get in at a lower price miss these moves - breakout traders know that the odds favour a continuation of the move when a significant level of support and resistance has been penetrated.

5. Money Management

The best forex strategies know there is risk involved in any trade and manage not just the risk per trade but have their eye on the overall risk to the account and the risk of ruin. You need to take care of the losses first and if you have a sound robust currency trading system the profits will look after themselves.

6. Acting on Confirmation

Many forex trading strategies liked to try and base themselves on so called scientific theories of market movement but the fact is trading is a game of odds NOT certainties and this is obvious. If markets did move to a scientific theory we would all know the price in advance and there would be no market.

While this is obvious many traders like to trade far out theories like: Gann Fibonacci and Elliot wave. None of them are scientific by nature and all involve subjectivity from the user - this is a contradiction in terms of a scientific theory.

Predicting means you are hoping or guessing and that won't get you far in life and certainly not FX trading.

7. Realism

The best forex trading strategies have realistic aims in terms of profits and while many can make triple digit profits in short periods of time over the longer term the best do 30 - 50% compounded and if you had one that did similar you would quickly compound a lot of money and be very wealthy.

If you understand the above you will see that forex trading strategies that are successful tend to be simple, robust, objective and have strong money management linked to realistic goals. If you do the same in your forex trading strategy you can make a lot of money in global forex markets.

Mini Forex Trading - What You Should Know About Mini Forex Trading

Mini Forex Trading - What You Should Know About Mini Forex Trading

by Abhishek Agarwal

Forex is one of the greatest ways to make money over the net. And thanks to the versatility and easy access through broadband, and to the fact there are over sixty currencies being traded every day, it is one of the most profitable money schemes.

In olden days the foreign exchange trade was restricted to multinational corporations, and banks. But thanks to the net, it is now possible for the everyday person to enter the market on an individual basis.

This market is the biggest in the world and it has a daily turn over of over 1.9 trillion US dollars. Moreover, this market is open round the clock seven days a week, so you can trade at any time you please to.

There are 2 kinds of currency accounts: the forex account (regular) and the mini account. Right now we will discuss the mini version..

Mini forex trading

Smaller investors can get great leads in the market by starting off their new venture with mini Forex.These markets are open to investors with minimum experience.

Mini forex accounts allow the operator to deposit only $100 and control a currency position worth $ 10000. With the regular exchanges of news items the positions could become $ 100000. These accounts are thus a tenth of the scale of a normal account, thereby being inviting to new traders. They offer a beginner at trading a great chance to get into the business with a minimum capital investment.

Traders who do not have a lot of money and want to do business with just less than $ 10000 are advised to preferably go with mini forex accounts. Not only does this strategy allows them more flexibility in the implementation of various strategies, but also gives them a lengthier stay in the market without taking the risk of over spending.

You may think that's impossible to trade 10000 value of the currency with only a small deposit, but this is a reality in mini forex trade. That's thanks to what they call a leverage.

Leveager allows you to buy and sell more of a particular product than what your account and you can draw, letting you have great performance. Too much leverage is risky, so do be careful you don't over spend on it.

The advantages of mini foreign currency account are not really different from ordinary forex account. You always have the ability to have access to small spreads, and a free trade platform.

But, as mentioned earlier, the greatest advantage of the opening of account forex mini is that you don't have to spend as much in order to see the gains. You might see less money, but the potential gains are still attractive.

Forex Day Trading - Scalping Your Way To a Fortune

Forex Day Trading - Scalping Your Way To a Fortune

by kelly Price

Today there are more forex day trading and scalping systems available online than ever before. It's the dream of many traders to buy one and day trade for a living and make an income by scalping regular profits and here we will look at this in more detail.

Well the theory, says regular profits - the reality is different and is:

All forex day traders and scalpers always lose.

The systems that you see on the net make big claims and track records that look great - but the track records are never real - there simulated.

This is a disclaimer you will see (or similar) read it carefully:

"cftc rule 4.41 - hypothetical or simulated performance results have certain limitations. unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown".

Any forex day trading system you see will be simulated and of course anyone can make a profit in hindsight - but in reality we have to trade not knowing the closing price in advance.

So why don't you ever find a forex day trading system with a real track record?

Quite simply - because forex day trading or scalping doesn't work.

The reason for this is all volatility in daily time periods is random, support and resistance levels are meaningless and prices can and do go anywhere in a day.

You can't get the odds on your side and you can't win - Period.

The proof of course is in the track record and you will never ever see a day trading or scalping system with a real one - try and find one and if you do let me know, I have been looking for 25 years!

HOW TO WIN

If You want to win at forex trading then you are going to need to look at longer time periods, you have a choice:

Forex trading following looking for trends that last for weeks or month or forex swing trading which looks for trends that last for a few days to around a week.

The one you choose is up to you but both allow you to get the odds on your side because they use data over longer periods.

If you want to win leave forex scalping to the dreamers, naive or greedy traders and concentrate on ways to get the odds in your favor and enjoy currency trading success.

Online Forex Brokers - A fantastic Idea for Novice Traders

Online Forex Brokers - A fantastic Idea for Novice Traders

by kelly Price

Will you make money at currency trading? This is a question most traders try and answer by trading a demo account - but the problem with demo accounts is there is no pressure, i.e no money on the line and it proves nothing.

Most traders who make money with demo account lose when they open an account with a forex broker. Now there is a fantastic way for traders to see if they have what it takes. There is a new account called a protected account and it acts as a bridge between a demo and a full trading account. The concept is:

The Protected Account works as a funded demo account in which the client pre-determines their risk level. Among its features are:

-Trade up to 100 times your initial deposit, even with a negative balance.

- Make as many trades as desired, 24 hours a day, using any currency pair.

- At the end of the a set period, (normally two weeks) any positive balance is the clients to keep the broker covers the losses. This has significant advantages over a demo account, as it simulates the feeling of trading real money on the Foreign Exchange and let's face it when money is on the line we feel and act differently.

Trading is probably 20&% method and 89% mindset and it's a fact that most traders fail because they don't trade with discipline.

To make money you not only need a method but you need the discipline to follow your method when the going gets tough. Its easy to score a penalty goal in your back garden but not so easy when its a huge game and you have to score to win and have 100,000 people watching you!

The Protected Account acts as a bridge between a demo account and a real one, providing an authentic trading experience, but of course the risk is managed and a huge advantage is - even if you go debit on the first day you can still keep trading so you get plenty of trades and plenty of practice.

These accounts are being now provided by forex brokers and they are a fantastic way to get your feet wet, before progressing to a full trading account and will help you determine if you have what it takes to become a successful forex trader.

Best Forex System - Beware of Backtesting!

Best Forex System - Beware of Backtesting!

by Harold Hsu

What is backtesting?

Backtesting is essentially the testing of a trading system using historical market prices, to see how profitable that system can be. This testing is usually done with computer software that runs the trading system through a period of time in the past.

Why beware of backtesting?

Many new traders think that good backtesting results will guarantee similar results in the future. This is a big mistake because a system that has worked in the past may not necessarily work in the future. This is because the Forex market is always changing and evolving. The Forex market today can be very different from the Forex market last year. The past does not equal the future... if it did, we'd all be millionaires by now!

What about trading systems with good backtesting results?

Because everyone knows what has happened in the past, it's easy for anyone to create a trading system that can be very profitable during that time (in the past). But remember: we're not trading in the past; we're trading in expectation of the future. Trading systems with good backtesting results may very well fail miserably in the future.

But this fact has not stopped unscrupulous people from selling Forex trading systems based on "excellent" backtesting results. They use impressive hypothetical (i.e. backtested) results as a sales tool. Unfortunately, many traders purchase these trading systems only to have them fail miserably and causing them to lose thousands of dollars.

What can I do to protect myself?

When looking for a good trading system, ask the system developer whether the trading results are actual or hypothetical. Many people assume that hypothetical returns are actual returns, but that's just not the case.

Now that you know it's easy to create a trading system based on backtesting (i.e. hypothetical) results, you'll hopefully be more skeptical about trading systems with little or no actual trading results.

Summary

While backtesting can be a very useful way to test a trading system, it's definitely not an accurate measure of how the system will perform for you in the future. Be wary of scammers who use hypothetical returns to try and sell you something!

Forex Trading Systems - Want to win 90% of the time?

Forex Trading Systems - Want to win 90% of the time?

by Harold Hsu

Online, you'll often read about Forex trading advertisements that boast of more than 90% winning trades.

Sounds great doesn't it? Would you pay $100 for a trading system that may win 90 out of every 100 trades?

If you answered "Yes", you're in trouble!

Unfortunately, the truth is that a high winning percentage has little to do with being a profitable trader. In reality, it's easy to have 90% of winning trades and still lose money.

Don't believe me? Go ahead a search online search for the "turtle traders". If you're familiar with them, you'll know that they are very profitable traders with only a 20% winning trade percentage.

Allow me to explain...

Imagine you make 10 trades in a month, and 9 of these trades are profitable for $1 per winning trade. This means that you have a winning percentage of 90%, with $9 in profit.

And if you have only 1 losing trade out of 10 (i.e. 10% losing trades), but you lose $10 on that one losing trade. In total, you would have lost ($9 - $10) $1 among all your ten trades.

Can you now see why a high winning percentage doesn't mean that you'll be a successful trader? You see, it's not about how often you win, but how MUCH you win.

So don't fall for the marketing tricks

Many advertisers use high winning percentages as a sales tool to get you to buy the trading systems they are selling. They know that traders like to win all the time, and who doesn't like to win often? These advertisers try to appeal to everyone's desire to win, and unfortunately many people fall for their trap.

Conclusion

It's easy to have 90% winning trades and still be a losing trader. At the same time, you can have a low winning percentage, but be a very profitable trader. In reality, winning percentages have very little to do with a trader's success.

So don't fall into the advertisers' trap when you see their "high winning percentage" claims next time. When people use high winning percentages as a sales pitch, chances are that they know very little about what it truly takes to be a successful trader. Be careful!