Forex Trading: 2009

Thursday, March 5, 2009

The 9 No’s of Forex Trading by fxreport

As a novice Forex Trader you should be aware that there are 9 big No No’s when it comes to forex trading. You should make sure that you don’t make the same mistakes that 90% of traders make, which is loose there money. These below are the 9 biggest reasons why people end broke from Forex Trading.

1. Scalping or Day Trading Although there are many articles about day trading or scalping as a new trader you should try to avoid it, as it is not a wise decision for a beginner. The reason for this as there is so much to learn about you can make. Forex Trading and learning to day trade first up is the most risky strategy that you can use.

2. Using a Guru There are experts everywhere that are willing to sell advice, but remember 90% of them will end up broke. They will offer to do it only commission, but ultimately it is your money that they will lose.

3. Using Bad Brokers- They are like gurus. Make sure that you research the brokers first and make sure that you check the figures of these brokers before committing. If you are looking for a Great Broker then view the CFD FX REPORTthey have recently researched all the brokers and have come up with some excellent brokers that can help you with your trading future.

4. Practice with demo accounts- for months If you use practice accounts for months, you are only kidding yourself as you don’t have the pressure of your money on the line.

5. Habitual trading Some Forex Traders trade just for the sake of it. They think that if they are not in the market they will miss a move. If you trade just for the sake of trading then chances won’t be in your favor. Over trading will only make you go broke faster.

6. Mix fundamentals and technical inputs- Just confusing yourself If you are trying to mix both you just confuse yourself and drain your bank account, not an ideal strategy for Forex Trading.

7. Breaking your Rules Patience is the key to forex success. So many traders get the perfect system but fail to wait it and will just trade for the sake of it, breaking there own rules. Have rules and stick to them.

8. All or Nothing- Massive Leverage Too many traders are trying to make it rich from the first trade if that is your plan then you will ultimately end up broke. Today there are many trading platforms that offer massive leverage, such as 400:1 which can be too high. Make sure you use money management skills when using leverage.

9. Using too many inputs Many traders think that complicated systems are the perfect system but with it they are more likely not to succeed. The best rule that you use is simple is best.

So make sure that you get as much as education as possible before starting to trade, as great place to get lots of free quality education lessons is the CFD FX REPORT. Happy Trading

About the Author:

The CFD FX REPORT is a real time trading tool that offers clients free trading reports, with trading ideas, stock market and forex market education as well helping them with. Also if you are looking for a Forex Broker, then feel free to visit our broker section as we recently reviewed all the forex brokers and have found the best on the market.

Avoid Common Mistakes

Beginning to trade on the Forex market can be a scary prospect. You can make things easier by being aware of some of the common mistakes that people encounter when beginning to trade.Don’t assume anything while trading on the market. For example, stops are important to avoid major losses. The stop should be set appropriately with the traders financial situation considered and should not be too close or too far away from the price.

Don’t get overexcited and start taking risks with leverage in hopes of getting rich quick. This rarely works and could end up costing you a lot of money.

Look at more than just the technical aspects of trading but also don’t let your emotions rule your decisions. You must look at everything combined when doing your research.

Another common mistake is following your system faithfully but not adjusting when it is necessary. Your system will need to change with the market or you could be facing a huge loss and have no idea why your system failed after it worked ten other times.

Forex-Money-Market

The Forex Money Market is the biggest market in the world, and it is worth over a trillion dollars a day. While this may seem like a lot of money, it is only because of the sheer scope and vision of the Forex market that this is so. The best thing about this market is that it is open to all and sundry. When it first opened, the Forex was closed to the small investors, and the banks required that you invest a minimum amount of money in the Forex. However, in a few short years all that has changed and today you can invest in the Forex.
The money market moves blindingly fast, so it is important to get a grip on the different mode through which you can get information. There are many different ways in which you can do this. Firstly, you can contact your broker and through him you will be able to make all the Forex actions that you will need to make. However, if you are looking for information on the latest price changes, the Internet is your best bet for fast, good and reliable information.

Forex Is Not As Hard As You May Think

The rewards of Forex trading are tremendous although the market can appear intimidating to a newcomer. Of course you have a number of so-called Forex professionals boasting about their track records and trading systems that claim to make you an instant success. However, Forex trading isn’t as complex as the industry experts have advertised.In actuality, Forex trading is something you truly have to experience for yourself to understand. This takes disciple in the form of developing strategies and thoroughly training yourself on the market.

Several educational tools can be found online at no cost. Trading charts are abundant and after learning how to effectively put them to use, you can be making real money in no time.

Equipped with knowledge, a sound strategy and a positive mind set, you too can achieve the financial freedom offered by Forex trading.

Facts About Forex

The Forex market was not available to everyone since it’s inception. In fact it has only been available to the public since 1998. The Internet brought the opportunity for everyone to get on there and trade on their own.

The Forex market is the largest trading market in the world and it is basically buying and selling the different currencies of the world. A typical Forex deal is made when one currency is bought and another is sold at the same time. Before Forex became available to the general public, trading was almost exclusively done by banks and other financial institutions.

Global trade has made countries more dependent on each other and the currencies interact much more than in the past. Economic fluctuations in different countries have an affect on all of the currencies. By following and analyzing the trends, someone could generate a tidy little profit by online trading on the Forex market but just as easily as it can go up, it can also go down.

Forex -Do It YourSelf- Part 4

36. Trading Short-term Moving Average Crossovers – This is the money sucker of the century. When the shorter term moving average cross the longer term moving average it only means that the average price in the short run is equal to the average price in the longer run. For the life of me I cannot understand why this is bullish or bearish. Easy to set up on software, complete with lights, bells and whistles, and good for the seller getting thousands for the software but in terms of creating profit it’s a zero.

37. Stochastic – Another money sucker. Personally I think this indicator is used backwards; when it first signals an overdone condition that’s when I think the big spike in the “overdone” currency pair occurs. To be overbought means strong and oversold means weak. Try buying on the first sign of overbought and selling on the first sign of oversold; you’ll be with the trend and likely have identified a move with plenty of juice left. So if %k and %d are both crossing 80; buy! (Same on sell side; sell at 20)

38. Simulated Results – Watch out for “black box” systems; these are forex trading systems that don’t divulge how the forex trade signals are generated. Great majority of them are absolute garbage. They show you a track record of extraordinary results but think about it; if you could build a trading system with half a dozen filters using the benefit of hindsight, couldn’t you too come up with a great system. Of course going forward is an entirely different story. High-speed number crunching capabilities allows for building great hindsight trading systems; BEWARE.

40. Master of None – Focus on one currency for technical trading; each forex currency has a unique way of trading and unless you get intimate with it you will never truly understand its underlying idiosyncrasies. Don’t spread yourself too thin – focus – master one currency at a time.

41. Thinking Long Term – Don’t do it. Stay in the moment. Especially if you’re a day forex trader. It doesn’t matter what happens next week or next month, if your trading with 30 to 50 point stops restrict your thought process to what’s happening right now. That is not to stay the long-term trend is not important; it is to say the long-term trend will not always help you when your trading a significantly shorter time frame.

Forex -Do It YourSelf- Part 3

22. Lucky or Good – Your Forex account balance changes don’t tell you the whole story about your trading; fact is if your taking a lot of risk and making money you will eventually crash and burn. Look at the individual trade details; focus on your big loses and losing streaks. Ask yourself this; if I had a couple of consecutive losing streaks or a couple of consecutive big loses, how would my account balance look. Generally, traders making money without big daily loses have the best chance of sustaining positive performance. The others are accidents waiting to happen.

Forex -Do It YourSelf- Part 2

11. Exiting Trades Poorly – If you put on a Forex trade and it’s not working make sure you exit properly; don’t compound the damage. If you’re in a winning trade don’t talk yourself out of the position because you’re bored or want to relieve stress; stress is a natural part of trading; get use to it.

12. Trading Too Short-term – If you’re profit target is less than 10 points don’t do the Forex trade; the spread you pay to enter the trade makes the odds way against you when you go for these tiny profits.

13. Picking Tops and Bottoms - Looking for bargains works well at the supermarket but not trading foreign exchange; try to trade in the direction the price is going and you’re results will improve.

14. Being Too Smart – The most successful forex traders I know are high school graduates. They keep it simple and don’t look beyond the obvious; their results are excellent.

15. Not Trading Around News Time – Most of the big moves occur around news time.
The volume is high and the moves are real; there is no better time to trade forex fundamentally or forex technically than when news is released; this is when the real money adjusts their positions and as a result the prices changes reflect serious currency flow (compared to quiet times when Bank traders rule the market with their customer order flow.

16. Ignore Technical Condition – Determining whether the forex market is over-extended long or over-extended short is a key determinant of near time price action. Spike moves often occur when the market is all one way.

17. Emotional Trading – When you don’t pre-plan you’re trades essentially it’s a thought and not an idea; thoughts are emotions and a very poor basis for doing trades. Do people generally say intelligent things when they are upset and emotional; I don’t think so.

18. Lack of Confidence – Confidence only comes from successful forex trading. If you lose money early in your trading career it’s very difficult to gain true confidence; the trick is don’t go off half-cocked; learn the business before you trade.

19. Lack of Courage to Take a Loss – There is nothing macho or gutsy about riding a loss, just stupidity and cowardice. It takes guts to accept your loss and wait for tomorrow to try again. Getting married to a bad position ruins lots of traders. The thing to remember is the market does crazy things often so don’t get married to any one trade; it’s just a trade. One good trade will not make you a trading success; rather it’s monthly and annual performance that defines a good trader.

20. Not Focusing on the Trade at Hand – There is no room for fantasizing in successful trading. Counting up and mentally spending profits you haven’t made yet is mental masturbation and does you no good. Same with worrying about a loss that hasn’t happened yet. Focus on your position and have a reasonable stop loss in place at the time you do the trade. Then be like an astronaut – sit back and enjoy the ride; no sense worrying because you have no real control; the market will do what it wants to do.

Forex -Do it YourSelf- Part 1

1. Knowledge Deficiency – Most new FOREX traders don’t take the time to learn what drives currency rates (primarily fundamentals). When news or a statement is due out they must close out their positions and sit out the best forex trading opportunities. They are taught to only trade after the market calms down. So essentially they miss the whole move and then trade the random noise that follows a forex fundamental price move. Just think for a moment about technically trading the aftermath of a price move; there is no potential.

2. Overtrading - Forex Trading often with tight stops and tiny profit targets will only make the broker rich. The desire to “just” make a few hundred dollars a day by locking in tiny profits whenever possible is a losing strategy.

3. Over leveraged - Leverage is a two way street. The Forex brokers want you to use high leverage because that means more spread income because your position size determines the amount of spread income; the bigger the position the more spread income the broker earns.

4. Relying on Others – Real Forex traders play a lone hand; they make their own decisions and don’t rely on others to make their trading decisions for them; there is no halfway; either trade for yourself or have someone else trade for you.

5. Stop Losses – Putting tight stop losses with retail brokers is a recipe for disaster. When you put on a trade commit to a reasonable stop loss limit that allows your trade a fair chance to develop.

6. Demo Accounts – Broker demo accounts are a shill game of sorts; they’re not as time sensitive as real accounts and therefore give the impression that time sensitive trading systems, such as short-term moving average crossovers can be consistently profitably traded; once you start dealing with real money reality is quick to set in.

7. Trading During Off Hours – Bank Forex traders, option traders, and hedge funds have a huge advantage during off hours; they can push the currencies around when no volume is going through and the end game is new traders get fleeced trying to trade signals. There is only one signal during off hours – stay out.

8. Trading a Currency, Not a Pair – Being right about a currency is half a trade; success or failure depends upon being right about the second currency that makes up the pair.

9. No Trading Plan - Make money is not a trading plan. A trading plan is a blueprint for trading success; it spells out what you see your edge as being; if you don’t have an edge, you don’t have a plan, and likely you’ll wind up a statistic (part of the 95% of new traders that lose and quit).

10. Trading Against Prevailing Trend – There is a huge difference between buying cheaply on the way down and buying cheaply. What was a low price quickly becomes a high price when you’re trading against the trend.

Forex Trading Short term strategy

Short-term Forex trading strategy:

1> Trade only the most liquid forex currency pairs, such as EUR/USD, GBP/USD, USD/JPY The most liquid pairs have the tightest trading spreads and fewer sudden price jumps.

2> Trade forex only during times of peak liquidity and market interest. Consistent liquidity and fluid market interest are essential to short-term trading strategies. Market liquidity is deepest during the European session when Asian and North American trading centers overlap with European time zones — about 2 a.m. to noon Eastern time (ET). Trading in other sessions can leave you with far fewer and less predictable short-term price movements to take advantage of.

3> Focus your forex trading on only one pair at a time. If you’re aiming to capture second-by-second or minute-by-minute price movements, you’ll need to fully concentrate on one pair at a time. It’ll also improve your feel for the pair if that pair is all you’re watching.

4> Preset your default trade size so you don’t have to keep specifying it on each deal.

5> Adjust your risk and reward expectations

to reflect the dealing spread of the currency pair you’re trading. With 2- to 5-pip spreads on most major pairs, you probably need to capture 3 to 10 pips per trade to offset losses if the market moves against you.

6> Avoid trading around forex data releases.

Carrying a shortterm position into a data release is very risky because prices can gap sharply after the release, blowing a shortterm strategy out of the water. Markets are also prone to quick price adjustments in the 15 to 30 minutes ahead of major data releases as nearby orders are triggered. This can lead to a quick shift against your position that may not be resolved before the data comes out.

Choose Your Forex Trading Style

Choosing Your Trading Style

1> Determining what trading style fits you best

2> Understanding the different trading styles

3> Developing and maintaining market discipline

Before you get involved in actively trading the forex
market, take a step back and think about how you want
to approach the market. There is more to currency trading
than meets the eye, and we think the trading style you choose
is one of the most important determinants of overall trading
success.
We’re frequently asked, “What’s the best way to trade the
forex market?” That’s a loaded question that seems to imply
there’s a right way and a wrong way to trade currencies.
Unfortunately, there is no easy answer. Better put, there is
no standard answer — one that applies to everyone.

offer every trading style (long-term, medium-term, or shortterm)
and approach (technical, fundamental, or a blend). So
in terms of deciding what style or approach is best suited to
currencies, the starting point is not the forex market itself, but
your own individual circumstances and way of thinking.
Real-world and lifestyle

considerations
Before you can begin to identify the trading style and approach
that works best for you, give some serious thought to what
resources you have available to support your trading. As with
many of life’s endeavors, when it comes to financial-market
trading, there are two main resources that people never seem
to have enough of: time and money. Deciding how much of each
you can devote to currency trading helps to establish how you
pursue your trading goals.

If you’re a full-time trader, you have lots of time to devote to
market analysis and actually trading the market. But because
currencies trade around the clock, you still have to be mindful
of which session you’re trading, and of the daily peaks and
troughs of activity and liquidity. (See Chapter 1 for tradingsession
specifics.) Just because the market is always open
doesn’t mean it’s necessarily always a good time to trade.

If you have a full-time job, your boss may not appreciate your
taking time to catch up on the charts or economic data
reports while you’re at work. That means you’ll have to use
your free time to do your market research. Be realistic when
you think about how much time you’ll be able to devote on a
regular basis, keeping in mind family obligations and other
personal circumstances.

When it comes to money, we can’t stress enough that trading
capital has to be risk capital and that you should never risk
any money that you can’t afford to lose. The standard definition
of risk capital is money that, if lost, will not materially
affect your standard of living. It goes without saying that borrowed
money is not risk capital — you should never use borrowed
money for speculative trading.

Forex Trading Trend or no Trend

When is a trend not a trend?

When it’s a range. A trading range or a range-bound market is a
market that remains confined within a relatively narrow range
of prices.

In currency pairs, a short-term (over the next few
hours) trading range may be 20 to 50 pips wide, while a
longer-term (over the next few days to weeks) range can be
200 to 400 pips wide.

For all the hype that trends get in various market literature,
the reality is that most markets trend no more than a third
of the time. The rest of the time they’re bouncing around in
ranges, consolidating, and trading sideways.

Although medium-term traders are normally looking to capture
larger relative price movements — say, 50 to 100 pips
or more — they’re also quick to take smaller profits on the
basis of short-term price behavior.

For instance, if a break of
a technical resistance level suggests a targeted price move of
80 pips higher to the next resistance level, the medium-term
trader is going to be more than happy capturing 70 percent
to 80 percent of the expected price move. They’re not going
to hold on to the position looking for the exact price target to
be hit.

Forex Trading Plan

Developing a Disciplined

Forex Trading Plan
No matter which trading style you decide to pursue, you need
an organized trading plan, or you won’t get very far. The difference
between making money and losing money in the forex
market can be as simple as trading with a plan or trading without
one.

A forex trading plan is an organized approach to executing
a trade strategy that you’ve developed based on your market
analysis and outlook.

Here are the key components of any forex trading plan

1> Determining position size: How large a position will you
take for each trade strategy? Position size is half the
equation for determining how much money is at stake in
each trade.

2> Deciding where to enter the position: Exactly where will
you try to open the desired position? What happens if
your entry level is not reached?

3> Setting stop-loss and take-profit levels: Exactly where
will you exit the position, both if it’s a winning position
(take profit) and if it’s a losing position (stop loss)? Stoploss
and take-profit levels are the second half of the equation
that determines how much money is at stake in each
trade.

That’s it — just three simple components. But it’s amazing
how many forex traders, experienced and beginner alike, open positions
without ever having fully thought through exactly what
their game plan is. Of course, you need to consider numerous
finer points when constructing a trading plan, and we focus
on them more in the full version of Currency Trading For
Dummies.

But for now, we just want to drive home the point
that trading without an organized plan is like flying an airplane
blindfolded — you may be able to get off the ground,
but how will you land?
And no matter how good your trading plan is, it won’t work
if you don’t follow it. Sometimes emotions bubble up and
distract traders from their trade plans. Other times, an unexpected
piece of news or price movement causes traders
to abandon their trade strategy in midstream, or midtrade,
as the case may be. Either way, when this happens, it’s the
same as never having had a trade plan in the first place.

Developing a forex trade plan and sticking to it are the two main
ingredients of trading discipline. If we were to name the one
defining characteristic of successful traders, it wouldn’t be
technical analysis skill, gut instinct, or aggressiveness —
though they’re all important. Nope, it would be trading discipline.

Traders who follow a disciplined approach are the ones
who survive year after year and market cycle after market
cycle. They can even be wrong more often than right and still
make money because they follow a disciplined approach.

Forex Trading Timing

The above Forex Market chart follow EST Time

GMT = (greenwich mean time)
EST = (eastern standard time)

Forex Euro Session

London Forex session opens daily at 8:00 GMT also 3:00 EST and closes at 17:00 GMT and 12:00 EST. London is one of the largest shopping centers in the world and has a market share of 30% minimum.
Some of the most active pairs during this session include USD/CHF, USD/CAD and EUR/USD.

New York Forex Session / American Session

This forex session opens daily at 13:00 GMT also 8:00 EST and closes at 22:00 GMT also 17:00 EST. The hot time in this session is usually when the euro traders are still active. Which is between 13:00 and 17:00 GMT also 8:00 EST and 12:00 EST. The most liquid pairs during this session would include USD/CHF, GBP/USD, USD/CAD and EUR/USD.

Asian Session

Tokyo starts off the morning @ 12:00 GMT also 19:00 EST and ends at 21:00 GMT also 04:00 EST Usually currency pairs with the GBP are the most active during this time. EG: GBP/JPY, GBP/CHF. The rates of USD/JPY, AUD/USD, NZD/USD pairs and there crosses are also quite lively during this session.

This concludes the article I hope this will be helpful to some of you.

Forex Trading Medium Term Strategy

Medium-term positions are typically held for periods ranging
anywhere from a few minutes to a few hours, but usually not
much longer than a day. Just as with short-term trading, the
key distinction for medium-term forex trading is not the length
of time the position is open, but the amount of pips you’re
seeking/risking.
Where short-term forex trading looks to profit from the routine
noise of minor price fluctuations, almost without regard for
the overall direction of the market, medium-term trading
seeks to get the overall direction right and profit from more
significant currency rate moves.

Almost as many currency speculators fall into the mediumterm
category (sometimes referred to as momentum trading
and swing trading) as fall into the short-term trading category.
Medium-term trading requires many of the same skills as
short-term trading, especially when it comes to entering/
exiting positions, but it also demands a broader perspective,
greater analytical effort, and a lot more patience.

Capturing forex intraday price moves for maximum effect
The essence of medium-term trading is determining where a
currency pair is likely to go over the next several hours or
days and constructing a trading strategy to exploit that view.
Medium-term traders typically pursue one of the following
overall approaches, with plenty of room to combine strategies:

1> Trading a view: Having a fundamental-based opinion on
which way a forex currency pair is likely to move. View trades
are typically based on prevailing market themes, like
interest rate expectations or economic growth trends.
View traders still need to be aware of technical levels as
part of an overall trading plan.

2> Trading the technicals: Basing your market outlook on
chart patterns, trend lines, support and resistance levels,
and momentum studies. Technical traders typically spot
a trade opportunity on their charts, but they still need to
be aware of fundamental events, because they’re the catalysts
for many breaks of technical levels.

3> Trading events and data: Basing positions on expected
outcomes of events, like a central bank rate decision or a
G7 meeting, or individual data reports. Event/data traders
typically open positions well in advance of events and
close them when the outcome is known.

4> Trading with the flow: Forex trading based on overall market
direction (trend) or information of major buying and selling
(flows). To trade on flow information, look for a broker
that offers market flow commentary. Flow traders tend to stay out of shortterm
range-bound markets and jump in only when a
market move is under way.

Tuesday, March 3, 2009

Forex Trading Indicators

Technical analysis is done through charts of various sorts, such as bar charts, that depict the currency price. In order to analyze these charts, Forex trading indicators are used in order to present a clearer view of the market status.
Forex trading indicators use information of the market, including open high low and close prices, in order to help traders make the right investing decisions to earn the most profits.
The most popular technical analysis indicators are :
The Relative Strength Indicator
Moving Averages
Momentum
Bollinger Bands

Forex Trading Bollinger Bands

Bollinger Bands are Forex trading indicators that were first developed by John Bollinger during the 1980s. Bollinger bands enable traders to know if a currency price is high or low. The upper band is the criterion for high prices, while the lower band is for low prices. Traders can use this indicator to recognize different Forex trading patterns and it is also useful to incorporate the use of this indicator in Forex system trading.

Bollinger bands use the standard deviation measure, which is used to figure out the spread of prices around the "true price". Bollinger bands will expand and contract as the currency price pattern expands to dynamic figures or contracts to close figures.

Forex Trading Relative Strength Indicator (RSI)

The relative strength indicator (RSI) shows if a currency is overbought or oversold.
Forex trading charts display the currency price that can be rising - with an uptrend, or falling - with a downtrend. If the currency price is on the rise it means the currency is overbought, because more and more traders buy the currency and raise its worth. If the currency price is dropping, then the currency is oversold.
Knowing if a currency price is overbought or oversold is crucial in your decision making process of investment, and this is exactly what RSI is for. The RSI is a Forex trading indicator of price fluctuations over a certain period of time.

Forex Trading Fibonacci Ratios

Fibonacci ratios are excellent tools for Forex trading, and in this guide we will make clear what most traders find complicated.
First, let's try to understand what Fibonacci ratios are. Fibonacci numbers are named after the Italian mathematician that found them. Each Fibonacci number consists of the summation of the previous two numbers. These numbers are: 1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144, etc… This way 3=2+1, 5=3+2 and so on.
Not including the first few Fibonacci numbers, the ratio of a Fibonacci number to the following one is always 0.618. For example, 89/144=0.618. The ratio between two alternate Fibonacci numbers is 0.382. These ratios are referred to as the golden mean, or divine ratio. These are one of the Fibonacci re-tracement levels and extension levels.

Forex Trading Momentum Analysis

Momentum analysis is a measure of the change in Forex trading trends over a certain period of time, similar to the RSI. The difference between momentum analysis and the RSI is that momentum gives you the option to analyze a specific rate variation in the time frame, while the RSI measures all of the rate changes in the time frame.

If the momentum is above 0, or it is seen as a rising curve, then an uptrend is present.

Monday, March 2, 2009

Become a Forex Pro In No Time

Forex is currently one of the largest and most flourishing financial markets in the world. Everyday, over $2 trillion is exchanged among several countries. The Forex doors are always open, giving you the opportunity to march right in and reap the benefits.

Here are a few tips to help you do just that:

Learning Restraint Impatience is the number one reason why investors fail at Forex trading. Once their investment shows the slightest sign of prosperity or trouble, they submit to emotions and sell immediately, resulting in a much smaller profit or an instant loss. Forex trading is very meticulous and calls for analytic skills, training and loads of patience.

Stay Updated

Stock investors keep their eye on the companies they are invested in. You should do the same. Keep yourself updated about your investments and how current events may impact that currency. Staying abreast on market trends will enable you to learn much faster.

Learn to Compound

Compounding is the act of reinvesting the profits from your initial investments. This is one of the fastest and easiest ways to prosper in Forex trading. Instead of going back into your account, use that $500 profit to invest into another currency.

How To Avoid Forex Failure

While Forex trading isn’t rocket science, it isn’t exactly child’s play either. Accordingly to statistics, almost 90% of the investors who try their hand at this flourishing market fail miserably. This article will help you elude some of the most common pitfalls.Stay Focused

Its no secret - there is a lot of money to be made with Forex trading. However, spending all that probable profit before it comes to fruition is a bad idea. Stay focused on your current position and discipline yourself with stop losses when it comes time to make a trade.

Stick to the Plan

Forex trading is big business, and as with any business, it requires a plan. If you profited on a carefully planned trade, going compulsive on an attractive teaser wouldn’t make any sense. Remain dedicated to your strategy and only invest profits on subsequent trades that meet your overall goals.

Trade Smart

Last but not least, you never want to trade for the wrong reasons. Do not make a trade in a vengeful attempt to redeem a significant loss or just because you’re bored. If you’re not sure about making a move or can’t see the potential your job is simple - don’t trade!

Take Emotions Out of FOREX Trading

Forex markets are very unpredictable. However, the major reason why money is lost relates to trading on emotion.This is a routine occurrence that happens every time a trader hesitates to make a move.

Its displayed when someone stays locked in a trade too long instead of raking money off the table. Both instances result in traders giving away potential profits to the markets.

Emotions weigh heavy on your decision making process - anxiety, shame, hope, anger, pride - you’re likely to experience them all. One of the most damaging of all is revenge. You were involved in a long trade only to suffer a huge loss that set you back tremendously. Now you’re out for vengeance, anxious to claim it on the Forex market that took your money. While it’s a part of human nature, this type of mentality can keep you out of the market for good.

Completely taming your emotions may be difficult, but you can manage them to a point where they are not interfering with important decision making. Becoming a successful trader takes discipline and the ability to replace your fears with a calm confidence. Some of the pros have termed this skill as “Emotional Intelligence”.

Strategies to Trade Forex..!!

1. As I always say, use extreme care when starting any trading program. I've created an area to advise you on how to save money and stay safe.

2. I've reviewed 30 of the most popular Forex trading programs; all but a few turned out to be a complete waste of time and money. In fact, the vast majority were simply re-hashed content that had been copied from other programs on the market.

3. I've listed 3 websites below - the best I've found. They're all very original and more importantly were produced by leading experts in the field of Forex trading. After consulting with some current members, they all seem to be very effective when it comes to quickly gaining profits.

Things to do..

Believe it or not, thousands of people just like you and me are making tens of thousands of dollars every single day — even though they don’t know the first thing about forex trading. I’m dead serious. These guys are on pace to earn $400,000+ EASY every year from now on.

What’s amazing is that these people aren’t investors, and they don’t have some big degree in economics... In fact, most of them have no idea how foreign currency trading even works. But they don’t have to. They’re still making money hand over fist. Without even trying thanks to one important element in this business... . .
They discovered the one key that unlocked the door to their future. And opened up a whole new world of wealth-building in the highly lucrative foreign exchange market. $3 trillion (yes, trillion) bucks change hands every single day in the forex market

Forex vs. Stocks

Unparalleled liquidity
In the forex market, over $3.2 trillion worth of trades are traded daily, which makes the currency trading market the most liquid market in the world – trading in 1 day what Wall St. trades in 1 month. No matter what time of the day or night it is, the forex market is always moving, and around the world active traders are buying and selling currencies.

Forex vs. Futures

The benefits of trading forex over futures may be significant. The forex market is the largest, most active financial market in the world, executing over $1.5 trillion a day – or about 46 times greater than all futures markets combined. Compared to the $30 billion futures trades executed daily, the volume of the Forex market is clearly superior. The daily futures volume on the CME is only slightly over 2% of the volume generated in the forex market. This tremendous liquidity is one of the many advantages that having full access to the forex market has over futures.

Fundamental Indicators

Fundamental analysis involves examining the intrinsic value of a nation’s currency based on economic news releases that reflect the strength, or weakness, of a country’s economy. Fundamental traders follow these news announcements, known as “fundamental indicators,” because they paint a picture of a currency's strength in relation to other countries. Fundamental indicators are reports that include statistical data on things such as employment, gross domestic product (GDP), international trade, retail sales, housing, manufacturing, and interest rates. The stability, growth, or decline in any of these sectors may have an effect – direct or indirect – on the value of a country’s currency.

Learn Forex Trading

FOREX (the Foreign Exchange market) is an international market where participants speculate on the value of different currencies, buying and selling dollars, pounds, euros, and other currencies.

This is your opportunity to find out how the real pros make a living trading the markets. Forex trading (also called Foreign Currency Trading) can be very lucrative. Profiting off the markets on a consistent basis, day in and day out, is the key to long term success. We have been showing people how to get consistent returns through all market conditions since 2004.
Imagine a business that has almost no overhead, you set your own hours, all your assets are liquid at all times, you are not tied to one location, you can never be fired or laid off, you can take a vacation when ever you want, you can work out of your home and if you do it well, you can also make as much money as you want

What Is Forex

Forex is an inter-bank market that took shape in 1971 when global trade shifted from fixed exchange rates to floating ones. This is a set of transactions among forex market agents involving exchange of specified sums of money in a currency unit of any given nation for currency of another nation at an agreed rate as of any specified date. During exchange, the exchange rate of one currency to another currency is determined simply: by supply and demand – exchange to which both parties agree.

Advantages

Liquidity:
the market operates the enormous money supply and gives absolute freedom in opening or closing a position in the current market quotation. High liquidity is a powerful magnet for any investor, because it gives him or her the freedom to open or to close a position of any size whatever.

FOREX is a highly profitable business which does not depend on time, place or political situation in your country. Advantage of this business is that you make deals using computer from any part of the world 24 hours per day 5 days per week.

What Moves Forex

Foreign Exchange is affected by various economic and political factors. The largest fluctuations in currency prices usually occur during Central Bank intervention, when governments trade in huge amounts forex in an attempt to either raise or lower the value of their own currency. This, as well as many other factors such as interest rate changes, economic figures, political instability and large lot transactions by hedge funds can move the market.

Participants

Commercial Banks
Central Banks
Currency Exchanges
Investment Funds
Brokerage Houses

Participants of this market are, first of all, large commercial banks through which the basic operations under the instruction of exporters and importers, investment institutes are carried out, insurance and pension funds, hedge and individual investors. Also these banks operations and in the interests due to own means, thus at large banks volumes of daily operations reach billions dollars, and at some banks even the basic part of the profit is formed only due to speculative operations with currency.