Dirty Forex Secrets

Archive for December, 2009

Forex trading is the new way to make money through online currency trading. With a worldwide market and over 60 currencies for you to trade there has never been an easier way to make money online.

Forex trading until recently was reserved for banks and other large financial industries but thanks to the power of the internet and online currency trading, forex has now become feasible for everyday people. The forex market has become the world’s largest trading market and each day there is an estimated turnover of over $1.5 trillion dollars. Another added bonus is that forex trading is available 24 hours a day, 5 days a week unlike most other markets that operate on an 8 hour day. This means that people wishing to trade forex can do so at any given time.

Forex currency trading is done is pairs and these are known as crosses. These pairs are always against the US dollar and the main crosses you will find when trading forex are the USD/EUR and the USD/GDP. The most popular crosses are known as majors and these can make forex traders great profits. Currencies change on a regular basis and are based on the how the world financial markets see the value of the currencies. You can sell or buy these currencies and forex brokers do not charge commission fees.

There are two types of forex accounts; a mini forex account and a regular forex account. Mini forex trading is an excellent way for small investors to learn about and take part in forex trading and with the most forex brokers offering a leverage of 100:1, mini forex trading will allow you to control a $10,000 currency position with a deposit of only $100. Mini forex trading is a great way to get a feel for forex trading and learn the tricks and skills needed to succeed without having to go to great expense. Why not try mini forex trading now and see just how easy it is to profit with forex trading.

Disclaimer: The information provided on this site is presented for entertainment purposes only. It is not professional advice of any kind or a recommendation to act. The owners of this site will not be held responsible for any form of  loss that may result from the use or misuse of any information contained herein. All visitors to this site are solely responsible for their own actions and assume all risks involved.

Affiliate Disclosure: In order to keep this information free, this site receives compensation from the purchase of some or all of the products or services that  it links to.

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Should new Forex traders take Forex trading courses or get a Forex trading tutorial? Definitely yes; by now you have probably heard that only 5% of traders achieve consistent profitable results when trading the Forex market. The main reason for this is the lack of education. Don’t get me wrong here, taking a Forex training program or a Forex trading turorial won’t guarantee profitable results, nothing can, but choosing the right Forex training program or Forex trading tutorial will definitely put the odds in your favor.

Before spending any amount of money on any Forex trading tutorial, there are some important aspects you need to take in consideration. There are many training programs available, but not every one of them suits the needs of every trader.

The first thing you should be looking in a Forex trading tutorial is the content of the material. Unfortunately, most courses or training programs focus or spend most of the time on basic concepts. Though these basic concepts are important, spending most of the course on them won’t help the trader to make consistent results.

The following subjects are what I consider the most important aspects of trading and every training program or  forex trading tutorial should address:

Forex trading basics.
Review basic concepts such as: margin, type of orders, a little background, bid/ask, rollover, etc. You need to make sure you have a crystal-clear understanding of every one of these concepts.

Main drawbacks of Forex traders.
Being aware of the common mistakes made by Forex traders and knowing how to handle them will prevent new traders from making those mistakes.

Technical and fundamental analysis.
These are the two main approaches adopted by Forex traders. Knowing how to properly apply each concept will definitely put the odds in your favor.

The three pillars of Forex trading. I consider that these three subjects have the most impact on every trader trading account.

Forex trading system development.
Having the right system is a must if you want to have consistent profitable results. Having a system that doesn’t fit you will cause a series of problems that will make your trading account vanish away (second guessing the system, not following your system, etc.)

Money management.
This is considered by many successful traders to be the most important single aspect of trading. Money management helps to increase your profits geometrically and at the same time limit your losses (i.e. a good risk reward ratio of about 2:1 will make you money in a Forex trading system that is right only 38% of the time.)

Trading psychology.
Being aware and knowing how to handle the psychological barriers that affect every trader decision will put the odds in your favor.

Other important aspects every forex trading tutorial should include are:
Developing habits for success (such as discipline patience, taking responsibility of every action, commitment, etc.,) understanding and taking on trading as a business, risk and trade management.

Another important consideration when choosing a Forex trading tutorial is the mechanics of it,  knowing how the training program works.

A good Forex trading tutorial will have the following:

A live conference room, where you can apply everything learned under live market conditions.

One-on-one feedback, every trader has different needs and requires special attention. For instance a trader wanting to improve the system and requires individual feedback from the instructor about it.

Online trading course, a course that could be accessible through internet. A plus is a course where you are able to access the course at the convenient time for you, so you don’t have to change your lifestyle.

A forum, where members can talk just about everything related to the Forex market and the Forex trading tutorial.

Trading the Forex market is no easy task. It requires a lot of hard work. Making the right decision about a Forex trading tutorial will definitely put the odds in your favor. Take your time when doing your diligence because it is a big and important step in a trader’s trading career.

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Disclaimer: The information provided on this site is presented for entertainment purposes only. It is not professional advice of any kind or a recommendation to act. The owners of this site will not be held responsible for any form of  loss that may result from the use or misuse of any information contained herein. All visitors to this site are solely responsible for their own actions and assume all risks involved.

Affiliate Disclosure: In order to keep this information free, this site receives compensation from the purchase of some or all of the products or services that  it links to.

Forex Secrets: This 35-Year Trader Was Losing Money Hand Over Fist Until He Discovered This One Weird (But Legal) Trick. CLICK HERE to Learn His Shocking Discovery!

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We’re focusing on technical analysis in this article with a description of some of the important indicators.

We could say, all wealthy traders use technical analysis but not all technical analysis traders are wealthy although T.A. is the most precise way of trading the Forex market. It’s also useful note that fundamentals play their part in indicating whether a price will move up or down. It gives you the edge over other traders.

Technical Analysis is so powerful because of a few reasons

1)    It represents numbers. All information and its impact on the market and traders is represented in a currency’s price.
2)    It helps to predict trends and the foreign exchange market is very trendy.
3)    Certain chart patterns are consistent, reliable and repeat themselves. T.A. helps us to see them.

Here’s one way of putting technical analysis into perspective (wish I had a dollar each time I said technical analysis). We all know that prices move in trends. Research has shown that those that trade with the trend greatly improve their chances of making a profitable trade.

Trends help you become aware of the overall market direction and often rescue us from less then profitable entry points.  Learning the tools of the trade the technical indicators and their applications will help you to diagnose what the market is doing but even then you need to expect ups and down and trade with emotional control.

Stay with the trend, follow the price.

Find out what the price of the currency pairis.  If EUR/USD is 1.4224 and moves to 1.4180 then 1.4090, that means that the market is in a down trend. Concern yourself only with what the market IS doing not what it might do. Listen to the markets and the indicators will backup what they are telling you.

Moving Averages.
Tell you the price at a given point of time over a defined period of intervals. They are called moving because they give you the latest price while calculating the average based on the selected time measure.

They lag the market so to give you an indication of a change in trend, use a shorter average such as a 5 or 10 day moving average. By combining a shorter term and longer term M.A. you can detect a buy signal when the shorter term crosses the longer term moving average in the upward direction. Or a sell signal if it crosses in a downward direction. For example, you could use a 5 day versus a 20 day moving average or a 40 day versus a 200 day moving average.
There are simple moving averages, linearly weighted which gives more importance to the recent prices or exponentially weighted. The latter is a favorite because it considers all prices in a time period but emphasizes the importance of the most recent price changes.

MACD
Based on moving averages, a MACD plots the difference between a 26 exponential moving average and a 12 day exponential moving average, with a 9 day used as a trigger line. If a MACD turns positive when the market is still plummeting it could be a strong buy signal. The converse also works.

Bollinger Bands (sounds like an elastic band)
Prices tend to stay between the upper and lower bands. They widen and become more narrow depending on the volatility of the market at the time. A sell signal would be when the moving average is above the Bollinger bands and vice versa for a buy signal. Some traders use it in conjunction with RSI, MACD, CCI and Rate of Change.

Fibonacci Retracement
Describe cycles found throughout nature and when applied to technical analysis can find shifts in the market trends.  After a climb prices often retrace a large portion sometimes all of the original move. Support and resitance levels often occur near the Fibonacci retracement levels.

RSI
Relative Strength Index measures the market activity to see whether it’s overbought or oversold. This is a leading indicator so helps to indicate what the market is going to do (awesome!). A higher RSI number indicates overbought (so expect a bearish shift) and a lower number indicates oversold.

Successful traders will generally use 3 or 4 signals to provide a more conclusive signal before entering a trade.

Always remember, ìf in doubt, stay out!  Technical analysis doesn’t factor in political news, a country’s economic profile or fundamental supply and demand.

Technical Analysis helps us figure out how much money to risk on a trade. How and when to enter the market and how to exit the trade for profit or to minimize loss.

I sincerely hope you found this article useful.

STOP! Avoid devastating mistakes and learn the one weird (but legal) trick this pro-trader learned the hard way in this article—>  Click Here Now!

Disclaimer: The information provided on this site is presented for entertainment purposes only. It is not professional advice of any kind or a recommendation to act. The owners of this site will not be held responsible for any form of  loss that may result from the use or misuse of any information contained herein. All visitors to this site are solely responsible for their own actions and assume all risks involved.

Affiliate Disclosure: In order to keep this information free, this site receives compensation from the purchase of some or all of the products or services that  it links to.

Forex trading has one goal: to make money. Unfortunately, like any speculative venture, there is a potential for losing money. The same holds true with the stock market the commodities market, and the money market. Any investment that entices of great gain poses a certain level of risk. As a forex trader you want to reduce your level of risk. Observe the following Best Practices:

Stay informed. Peruse the current events magazines and political journals. Know how the global political and social landscapes. Have been shifting.

Brush up on economics.  A college refresher course can keep you out of the red. Journals by economists like John Maynard Keyes, Kenneth Galbraith and Walter Williams can aid you in  guesstimating potential forex uptrends.

Read periodicals like the Asian Wall Street Journal and Business Investors Daily.

Start practicing on a demo account and get a feel for the game before diving into the market.

Befriend a broker you trust.

Cultivate friendships with other traders into active trading.

Understand historical trends and their impact on the charts.

Take a short course on forex trading to get your skills up to speed. These cost under $200 and can help you avoid $20000 losses.

Research forex on the Internet. Forums provide great sources of information.

And finally, invest money that you can actually afford to lose if worse comes to worse. Then you won’t be out of the game completely.

Cut your losses early. When a portfolio is losing week after week, shed it. It may take months to recover which means money tied unproductively.

Invest in multiple currency pairs, such as EU-GBP, GBP-USD, CHF-USD. This frees the trader from monumental losses incurred when all eggs are thrown into one currency pair.

Don’t hang to a position for extended periods. This isn’t the stock market where equities tend to go up in the long term. Sell positions when minor up movements are made and reinvest in other currency pairs.

Good luck and happy trading!

Disclaimer: The information provided on this site is presented for entertainment purposes only. It is not professional advice of any kind or a recommendation to act. The owners of this site will not be held responsible for any form of  loss that may result from the use or misuse of any information contained herein. All visitors to this site are solely responsible for their own actions and assume all risks involved.

Affiliate Disclosure: In order to keep this information free, this site receives compensation from the purchase of some or all of the products or services that  it links to.

The information provided on this blog is presented for entertainment purposes only. It is not professional advice of any kind or a recommendation to act. The owners of this blog and all those associated with it will not be held responsible for any form of loss that may result from the use or misuse of any information contained herein. All visitors to this blog are solely responsible for their own actions and assume all risks involved. The owners of this blog receive compensation from the purchase of some or all of the products that it links to.

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