The Trend of Forex Trading

Monday, January 25, 2010

Forex trading system of the world performs trade of about $2 trillion each day. The enormity of the gigantic financial capacity of the Forex trade can be truly grasped if you compare this mammoth amount to the $25 billion that New York Stock Exchange trader's trade per day.

The quintessential qualities of a Forex trader are discipline and endeavor. If you are diligent and logical in studying the Forex market trends then it wouldn't take you much time to hit the jackpot in Forex trade. However, if you cannot manually manage to analyze all the currency trends yourself then you might take the help of a automatic signal service or a Forex trading software which would send you alerts and signals about buying and selling currency after elaborate research and analysis.

If you use one of the automated Forex tools available in the market then you would be able to evaluate the trends of exchange rates and Forex market conditions within a few minutes with the help of the data provided by your FX software. As a result you will be able to close your forex deal in less than an hour. Thus an automated Forex tool would ensure that you are making optimum use of your trading time.


The global Forex trading market is only merely remarkable because of the huge volume of monetary transactions that happens through it but it is also a commendable phenomenon due to its geographical dispersion. With the help of automated FX software you can trade in various local as well as international Forex markets within different time zones without personally monitoring those various markets day in and day out.

However, before you decide to buy particular FX software, you need to put in a little effort to search for a Forex tool which is easy to use and is ideal for beginners. Glean information about that particular Forex tool which you plan to buy and thoroughly read the testimonials for that particular Forex trading software before you purchase it.

Forex Trading Errors

When we are trading we will all from time to time make a mistake when forex trading and it is normal and sometimes can be looked upon as healthy, so as to know that the decisions will either make or break you. However, if this becomes severe to a point wherein you lose more than you can afford to, then you would have to take measures in order to avoid further damage. This is why when you are trading you must make sure that you only trade within your limits. If you can't afford to lose it, don't trade.

When trading you must make sure that you keep your emotions in tact, do not let them take over. If you let your emotions take over the result is more than likely to cause even more rash decisions and can cloud your strategies, producing even more disastrous results. You should aim for more positive months with good turnovers but face it; there are some periods wherein gain is not achievable.

Before trading you should make sure that you have a plan and part of that plan is to employ a money management technique; in case is where you went wrong the first time. You should always consider what your losses are going to be. Since most traders would tend to gamble as opposed to trade, instead of making a calculated risk, their bank accounts would be drained each time there is a loss. They don’t have a great capital management system which causes damaging effects.

You must make sure that you educate yourself as much as possible about the Forex Market, a great place for education lessons is the CFD FX REPORT They specialize in offering free Forex Education as well as helping you find the Best Forex Broker.

Each trader has their own attitude towards forex trading and what risks they are personally prepared to take, but learning about the inherent principles can go a long way in helping you develop your own style and making you more successful in the long run. You can also develop a trading system and make sure to be disciplined enough to follow what you have created. Remember create the plan, plan the trade and trade the plan. You should have this next to your trading screen at all times and never forget it.

Do not associate loss with the feeling of being a loser, in order to be a successful trader you will take losses and the best traders can handle them. When trading you should know that you can't pick the market 100% of the time, so there is going to be losses it is how you handle those losses to how successful you are. The forex market is an objective industry wherein sound decision-making and strategies are employed and not about judging your emotional capabilities and dealing with them. If you can't handles losses, or losing money, do yourself a favor and don't trade.

Trading without Indicators

When it comes to trading most professional traders will be trading with indicators, so when most people hear that someone is trading with out them there is an instant look of bewilderment. To them it sounds like driving in the dark with no lights. But in fact it is the opposite.

So to people that trade without indicators they have to same reaction to people that trade with 10 indicators on their charts in order to place a trade. They will view all of these indicators as causing a blind spot to what is actually going on in the market.

FOREX Traders have been trading without indicators for as longs as the market have been around. This is what is simply known as price action. This particular trader is looking at the chart, looking at the current prices movements, comparing it to past price action movements to predict future price movements. So in simple terms everything we need know is sitting there right before our eyes, without the block of needless indicators.

Here is an example, within the FOREX Market there are certain patters that will be repeated on a constant basis. They are predictive in nature, as opposed to indicators like and RSI or MACD which are always lagging. They are only telling us what has already happened. Anybody can be a millionaire if they only tell you what has happened already. The real skill is using past information to make an informed decision about what the future holds. Trading without indicators is as close as we'll ever get to being a FOREX Trading psychic.

For more education lessons please feel free to visit the CFD FX REPORT they are helping traders become more educated.

Indicators In Forex Trading

Forex traders often look at indicators such as Bollinger Bands, Pivot Points, MACD, Moving Averages which help them to determine where to enter or exit trades. Using technical indicators is fine, however many traders overemphasize their importance or just plain misunderstand them.

Many Forex traders think that they can simply download an indicator and then mechanically apply it into their trading and do so profitably. This is just a plain illusion. Successful traders realize that there is a lot more to using indicators than just asking them to generate buy/sell signals or pin-point exact entry points. Technical indicators for them represent just one part of their trading strategy.

Let us take a look at some of the reasons why you should not put all your faith into those sometimes confusing little indicators.

Take Moving Averages for example. They are "supposed" to show the direction of the trend. The most common and often used are the simple 200day MA, 100day MA, 50day MA, 35day MA and the 21day MA but they are only valid on daily graphs. Some Forex day traders say that a good signal is when the 50day MA is crossed by the 13day MA and that when this occurs you should trade in the direction of the cross.

The problem with this (apart from the fact that it only works on daily graphs) is that these types of ¡°crosses¡± do not occur often enough for traders to exploit them. This can often lead to a situation where traders are seeing what they thought was a cross now reverse and uncross. Even worse, it can lead to a situation where day traders are "chasing" and trying to anticipate a cross. If you are doing this, you are distancing yourself from the market which you are trying to trade. Not only are you trying to guess what the price is going to do next but you are guessing what the indicator, based on the prices, is going to do next.

Other problems with technical indicators involve issues with the quotes and prices given to you by your broker. Forex brokers are market makers and as such different brokers will give you different quotes and prices at a specific point in time. Naturally, a different price could lead to a situation where different traders, trading the same market have the same indicators giving them different responses. Thats how arbitrary technical indicators can be.

Finally, a lot of these technical indicators were developed by people trading the stock market. With the growth of computers and software packages that incorporate these indicators, technical analysis has become very popular and spread to other markets such as the Forex market. What currency traders should be aware of however, is that as these indicators were developed in a time where real time information did not exist. As such, the limitations of technical analysis becomes even more exaggerated in Forex trading ¨C not only is technical analysis an interpretation of historical events but it becomes even more so in the Forex market, a market moved by real time events.

For Forex Traders

Forex trading can deal with lots of money and so when you are trading you need to be sure that you have optimal conditions. Too many traders trade out of habit and this can be a dangerous thing because it may not mean you have the best conditions. As a matter of fact trading in poor conditions can cost you hundreds and sometimes thousands of dollars. Trading conditions will not always be optimal and you cannot wait to only trade when they are. It isn't about recognizing the perfect time to trade. Instead it is about knowing when not to trade. When the market is moving sideways or not really moving at all it is unwise to trade real money. You have no indications of what is going to happen and so you are making your decisions off of pure guess and that is a dangerous place to be in. Do not trade real money when you are ill or overly tired. The condition of your body can have a big effect on how your mind thinks. If you dive into trading and you are tired, worn out or just sick it will have an effect on how quick you think and what you think. Trading when your mind is not at a high will mean trouble. Give you body the time to rest and save your bank account the funds of you trading while sick or tired. There is almost nothing worse than trading when you are emotionally distracted by other factors. It is horrible for two reasons. One your mind isn't on the trading take place, it is off trying to resolve or analyze the problem. The less focus you have the more mistakes you make. The second reason is that if you are emotionally distracted then you are already allowing your emotions to take precedence on your decisions. If you are emotionally distracted then the odds of you trading based on emotion are extremely high. And finally never trade with money you cant afford to lose or when you feel you have to make a certain amount. Those factors create unnecessary pressure on you and your trading.

Global Forex Trading

Forex is one of the greatest homey work opportunity to make money. It gives an opportunity to make money from the comfort of your home and spending the time with family at the same time.

It is also an opportunity which you can do along with your existing day job. Forex means foreign exchange and Forex trading means is the trading between foreign exchanges.

Forex trading requires some knowledge about the way the Forex market runs. You have to learn about he factors both local and the global which affects the market.

If you want to succeed in this particular trading you must have the knowledge about the basics and facts.

Global Forex Trading offers the chance to deal in real time online currency trading that makes millions of forex brokers become more rich every day.

Global Forex Trading has less publicity that stock and commodities market and even the futures, even more than $2 trillion of currencies are transacted every day on the global forex market.

Compared to stocks and shares or commodity markets that have specific opening and ending trading times. At the same time, Forex markets are available for trading anytime with price of currencies changes and fluctuates every time.

Forex trading has become an extremely popular way to trade the global market, the largest and most liquid market in the world.

The Forex Trading market is open 24 hours a day. Forex trading also gives free commission and available on more than 60 currencies worldwide.

Global forex trading boasts that they provide the only forex trading platform that is suitable for both beginners and professionals.

Forex Trading has no restrictions of getting profits no matter what the market condition.

Nowday, the Global Forex Trading is available not only for the large investors but the smaller one can take a part too.

Leverage is the main key and powerful tool to Forex Trading wealth. You should have a good education in Forex trading to reach gain and profits consistently.

In Forex trading, you can get a leverage of 20 to 50 times commonly up to 100% margin in some special cases. In stocks or shares, you may be able to get it of 50 - 70% of your stocks or shares.

Leverage is the main key and powerful tool to Forex Trading wealth. You should have a good education in Forex trading to reach gain and profits consistently.

With that leverage comparison, you may be able become a millionaire fastest in Forex trading.

All things you need to know and learn it up in Forex trading ; knowing risk level - how much you are willing to lose, understanding the different Forex trading systems as technical and fundamental and research the trading systems which you can be familiar with how they work.

Also learning the trading trends, price history, support and resistance lines, familiar with the fundamental economic factors and its issues that effect to the Forex market.

Be a Successful Trader

The share market today is as volatile as we have seen it, as stock prices continue to fluctuate the only way to preserve your money is to sit on the sidelines and the chaos goes on in the financials and other sectors. With the wild swings in the market as it continues at times to make no sense. We have seen days of down 500 points, followed by days of up 450 points, actual trading sessions moving as much as 1000 points. How do we make sense of these crazy markets and more importantly how do we make money.

Do not worry there is a systems out there that will teach you manage your trades. With this type of knowledge you can go from a learner trader to an Expert Trader
Forex Broker in no time.

Becoming a successful stock market trader requires learning and having a certain level of knowledge, confidence and the ability to control your fear and greed. Stock Market or Forex Trading is best explained as supply and demand, if a lot of people want the stock it goes up, if they don't want it then it falls. There are endless amounts of research available today from online reports, newspapers, education lessons the list is quiet long so how do you decide when and where to start. The first step you need to take is to decide that you want to become a trader. Then you need to right out your goals and your reasons why.

What you now need to do is to learn and understand that in theory things can seem simple however once you are trading in these at times crazy trading markets things can seem confusing. This is why it all comes back to having the right level of education and knowledge and where possible a great mentor or Broker. Using these steps almost anyone can become a trading success.

To learn more on the stock market or forex market feel free to visit the CFD FX REPORT as they have some excellent education lessons available, and they can also help you find the best online brokers in the market.

Successful Forex Trading

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Today there are many people in the world that are using Forex to make money. Forex trading is buying and selling currencies to make profit from it. It can be a great money making business if you can do it right. It is the type of business that you can make thousands of Dollars each month if it is done correctly
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There are some major advantages to Forex Trading.

* The long hours that the Forex market is open, it trades 24 hours a day for 6 days per week and is the most liquid market in the world. So even if you have a full time job you can still come home and trade. It is a great way to start out, paper trade build up confidence start achieving financial success then you can leave your current job.

* It doesn't matter what the market is doing as you can just as easy go long (buy currency) or go short (sell currency) so there is never a bad time unlike buying stocks. The liquidity means that you have no problem selling.

* You don't need thousands to start. The reason that you don't need massive bank balance is because you can use leverage, in some cases you can get 400:1 so if you have $1000 you can leverage that into $400,000, which can make for great profits. Also you don't pay brokerage or commissions. If you are looking for a great Forex Broker feel free to visit us and we can show you the best Forex brokers in the markets.

* The market will never go broke. Unlike share trading where companies can collapse it is very unlikely to happen in Forex. Imagine if the USD was worth $0, so you can see very unlikely.

* If you are new to the foreign exchange market, you do not have to worry about spending thousands of dollars to learn or buy a course. There is online Forex trading course that will explain how the forex market works and a Forex tutorial will also explain about fundamental and technical strategies that are available to you as a Forex trader.

* Work your own hours if you don't feel like trading then you don't have to, it will always be open tomorrow.

Elements of a Trading Plan

Here are some important elements of a trading plan.

1. Why am I trading? What are my goals?

The answers to these questions might seem obvious, but they usually are not. Take some time to ask them of yourself, and seriously consider the answers. You may be surprised by what you learn. And whatever the answers, you will have a clearer picture going forward of what this enterprise means to you, and that will help you survive any rough patches.

2. What markets am I going to trade and why?

It is often best to specialize, especially for beginning stock market traders. Many pros make a great living trading the same stock day every single day for years. Choose a market that is appropriate for your experience level and trading style. Consider other factors such as available margin, volatility and liquidity.

3. What is the concept or philosophy behind your trading methodology?

Your trading system must have a concept behind it. Whether you are a value investor like Warren Buffet or a trend trader like George Soros, you should understand why you are doing what you are doing, how your beliefs about the markets define what you will do as a trader.

4. What will be your specific method?

In other words, specifically how will you execute your trading ideas? Will you buy breakouts or pullbacks? Buy oversold or sell overbought? Or will you use specific technical setups such as moving-average crossovers or another indicator-based strategy? Under exactly what conditions will you enter? When will you know to exit?

5. How much money will you risk on any single trade? On trading in general?

This is critical. Of course, start small. But just as importantly, have a plan in place for how much you will risk, emotions don't cloud your judgment when the time comes. The key is to find an allocation that doesn't cause any stress but still makes the trade worthwhile financially. One of the biggest problems with newer traders is that they are trading way too big in relation to their account size. Like when you are forex trading. Trading forex at 100-1 leverage is like introducing your mistress to your wife. Yes, you can do it, but that doesn't make it a good idea. Normally they don't get along too well.

6. What will my trading rules be?

This is also critical. Your trading rules include entry and exit rules, rules governing maximum daily, weekly or monthly losses, maximum risk on any given trade, the maximum number of trades per week, etc., etc. These rules enforce discipline and keep you out of trouble. What stock price will enter at, what stock price will I will exit. Be discplined.

7. How will I record and evaluate my trading performance?

Allow me to repeat myself: This is critical. In fact, this might be the most important element of trading for new traders in the stock market. A new stock market trader who evaluates his trades, winners and losers, in an effort to learn what works and what does not, will make quantum leaps forward in terms of ability and profitability. If you have a working trading plan and evaluate every single one of your trades after you have closed it you have already beaten 95% of the competition.

8. What are my rules for managing profits?

What's the problem with profits? Well, believe it or not there is one, and it's a serious one. It's called euphoria, and it clouds the judgment perhaps more than any other emotion related to trading. Start piling up the profits for the first time and it won't be long before you are convinced you are king of the world. About 30 seconds later you'll be broke, following a series of unwise and exceedingly risky trades. So have a plan for protecting closed profits when you have reached your goals for the week or the month. Don't give them all back.

9. How will I reward myself for following my trading plan?

Don't leave this out. Following your trading plan will bring rewards in the form of profits, but you should also consciously reward yourself for doing so because it is such an important part of successful trading. So if you finish the week or the month (or even the day) without having broken any of your trading rules, find a way to reward yourself. You deserve it. You are in rare company.

Successful Stock Market Trading

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Successful stock market trading begins with a winning trading plan. It's as simple as that. If you develop a well-conceived trading plan to guide your actions in the stock market you will already have the advantage over most of your market competition. Put simply, it gives you the edge you need to win over the long haul when trading the stock market or forex market.

A stock market trading plan will not guarantee your success in the markets, but a good plan will enable you to work methodically toward your stock market trading goals while reviewing on a regular basis what is working and what is not. It will act as a roadmap for your trading journey. It will enable you to respond positively and constructively no matter what happens with your individual trades. And, most importantly, it will help you control the only thing a trader can control: his or her own actions.

Finally, stock market trading is a business. It can be a fascinating and sometimes thrilling business, but in the end it is a business. A trading plan helps you treat it as a business.

Learn To Trade Stocks

Learning to trade stocks is no easy matter. But it's not impossible. You have to set yourself out to spend some time to do research and to monitor your positions every once in a while. I have been trading stocks for over 15 years. I can remember my early years of trading. I would get into a position and then when I saw that it was going against me, I would get out, often at the very wrong time. I say that because the next day or week the stock surpassed where I had bought it from.

Learning to trade stocks requires some skill but it also requires you to shed some of your ingrained, inbred emotions. It's these very emotions that caused me to sell stocks too early in by beginning days of trading. I have overcome these emotions now and I have a set of rules that I follow religiously. That doesn't mean that I can't change the rules of my system but I have to give myself a good reason to do so. If I don't change my system than I stick to them. That is how I keep emotions out of the equation.

The most important way to help yourself when learning to trade stocks is to come up with your own system and practice. But practicing with real money can be costly. Some people refer to this as your tuition but what if you could avoid putting real money on the line and still get the practice you need?

A way to do that is by a concept known as paper trading. Now, there are critics of paper trading that state that because you are not putting real money on the line you will not have the same kinds of emotions that you would had you put your hard earned cash in. They also state that you will not get the same kind of fills that you would when you trade for real. There is some truth to these statements but it shouldn't stop you from pursuing paper trading because there are ways to reduce the aspects of paper trading that are criticized.

To counter the first item, paper trading is still experience. Yes, the emotions are not the same but what you are really doing is trying to get a feel for whether your system is working or going to work. The second item's counterpoint is if you take the midpoint of the bid and ask at any given time of the day or at the close, you would likely get filled at those levels had you traded real money. That's because it falls within the range of the bid/ask spread. I have used this technique when trading for real and with the exception of super fast moving stocks, I almost always got filled.

I think if you want to go about learning to trade stocks you need a system and you need to be able to practice trading. You want to be able to do both of these without putting up a whole lot of capital (none if you can get away with it). One system that I have found that is indispensable and reliable is the CANSLIM method.

FOREX Knowledge

With the dawn of further FOREX retail traders in the market, competition amongst brokers has led to a multiplication in platform flexibility and features. Therefore, every broker over the preceding few years has tried to provide a better and easier way into the foreign exchange market in support of the beginner. I will pose various of the more obvious questions you need to find out from or ask your broker.

First and foremost are 'spreads' and how the broker deals with them. Spreads are valuable as the beginner needs to minimise his chance and reduce any expenses when entering and exiting a trade. Frequently, spreads are quoted by the broker as being 'fixed' or 'variable' for every currency pair. I have noticed that these days, spreads are continuously 'variable' and few brokers offer really fixed ones. Although they may say EUR/USD has a 3 pip spread, what they mean is so as to this is the minimum spread. You can be guaranteed that in times of high volatility, as prices are moving quickly, the spread will expand. Note furthermore, that some brokers boost their spreads if the 'lot' size is lower - see the types of account beneath. This seems a bit odd as this certainly will not promote new business for the broker!

One point to bring up is that although this point is valuable for the beginner trader, as you get extra experience, spreads turn into less of an issue while choosing a broker as they become less important and more skilled traders will point out other features over spreads when taking into account what broker to pick out. Here are lots of websites listing broker details such as http://www.etoro.iwow.us so do your homework before choosing!

The next entity is whether the broker offers all three of the 'standard' accounts - regular, mini and micro. Regular accounts deal with full 'lots' ($10 loss or profit for each pip movement in the currency, if trading a USD pair) and therefore require the principal amount of opening capital of around $5000. Although mini accounts ($1 loss or gain for each pip movement) are now abundant and ordinary, they still require a certain amount of capital to open so as to may be further than some new traders. Micro accounts (Only 10c loss or gain for each pip movement) deal with such small sums of money that they are better than trading demo, but the chance is low when it comes to losing capital. Consequently, they require the smallest amount start-up capital in the region of only a couple of hundred dollars.

Various checks will be made when you open an account, and if the company is based in another country, you will need to fill in various tax exemption forms such as a W-8BEN previous to the account will be opened, don't let this put you off!

A further check you could wish to do previous to considering a broker is to check their performance at the Commodity Futures Trading Commission website www.cftc.gov to ensure they are listed and have the vital minimum turnover and liquidity. Any sizable court cases will also be listed.

If you expect to carry out 'position' or 'swing' trades, such that you will be holding overnight positions, you might want to check what rates of interest will be paid/debited from your account. This is now and again hard to find on some websites, but can be very informative as generally brokers offer poor 'carry' interest if you are in a trade for a lenghty period of time.

Check to ensure what currency pairs they offer - again, generally companies offer most of the most commonly traded pairs but it's nice to see how 'established' they are by seeing if they offer other trades such as gold, S&P, futures etc.

Unfortunately, something you can't check is the kind of service the broker offers. Mainly will be 'discount' brokers, which basically means that they offer no trade advice or all-purpose help and if you address to anybody on the trading floor about your trade, they will be usually be brief and 'to the point'.

Try to find a broker who has downloadable free software that you trade from on your computer. The other way is to trade 'live' from a website, but I discover this inflexible, especially if you constantly need to click between screens as this usually requires the loading of a new webpage and makes everything quite 'clunky' even if you maintain a fast broadband connection.

Tips For Day Trading

Thursday, January 21, 2010

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Day trading the stock market involves the rapid buying and selling of stocks on a day-to-day basis. This technique is used to secure quick profits from the constant changes in stock values, minute to minute, second to second. It is rare that a day trader will remain in a trade over the course of a night into the next day. These trades are entered and exited in a matter of minutes.

The main question that most people ask when it comes to day trading is simple: Is it necessary to sit at a computer watching the markets ALL day long in order to be a successful day trader?

The answer is no. It's not necessary to sit at a computer all day long. There are a number of factors to consider, but generally the rule of day trading is to trade when everyone else is trading. In other words, trade in the morning.

As with all financial investments, day trading is risky in fact, it's one of the riskiest forms of trading out there. The stock prices rise or fall according to the behavior of the market, which is entirely unpredictable. Day traders buy and sell shares rapidly in the hopes of gaining profits within the minutes and seconds they own those particular stocks. Simple to do in theory, harder to do in practice.

If you are constrained by a small amount of capital, you may not be able to buy large amounts of a stock, but buying only a small amount can add to the risk of a loss. And, obviously, it is impossible to predict with certainty which stocks will result in profits and which in losses. Even the best of traders must learn to accept both outcomes.

It's also important to know that in day trading, it is the number of shares rather than the value of shares that should be the focus. If you day trade, you WILL face losses, but even for the more expensive stocks, the loss should be marginal, because prices do not usually fluctuate to an extreme degree over the course of just one day.

The day trading industry deals in a large variety of stocks and shares. Here are just a few:

Growth-Buying Shares: shares made from profit, which continue to grow in value. Eventually, these shares will begin to decline in price, and an experienced trader can usually predict the future of this type of share.

Small Caps: shares of companies which are on the rise and show no signs of stopping. Although these shares are generally cheap, they are a very risky investment for day traders. You'll be safer to go with large caps and/or mid-caps, which are much more secure and stable thanks to a premium.

Unloved Stocks: company stock that has not performed well in the past. Traders buy these shares in the hopes of generating profits if and when the stock rises in value. As with small caps, unloved stocks can be a risky choice for day traders.

These examples are NOT your only options when it comes to day trading stocks. The best way to determine which type of stock is right for you is to invest some time for careful research, a knowledge of market patterns, a solid strategy, and a disciplined trading plan.
You need to learn to trade ONLY when the market gives the right signals, and ONLY when the volume of activity in the market supports a successful trading opportunity.