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Forex Trading Articles

Currency Trading Mastery – 5 Tips to Master Your Emotions in Forex Trading

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Many people lost money in forex trading not because they do not have a good forex trading system, a forex strategy or a set of rules they do not follow, but it’s the psychology barrier that they have to get over it. They cannot beat their emotions and that caused them to make wrong decisions and lose their trading capital in a flash.

Forex trading psychology is the most important factor for trading success or failure, but it’s sad to say that many traders do not have that factor as priority and instead keep looking for better forex trading strategies.

1. Do what you are supposed to do. When the trend is weakening, you should take steps to protect your profits regardless of the forex systems that you are using. Remember that in forex trading, you should be thinking how to minimize losses first and not thinking how to win.

Even a breakeven trade is considered a successful trade because it’s not a loss. Likewise when the trend goes in your direction, you will want to set a higher level profit target and on the same time protect your floating profits.

2. You do not like, hate or fall in love with your trades. The currencies pairs are not your friends in the forex market and your only friend is forex trading psychology. Trading with a plan is the #1 forex tips because when a trader is already in a trade position, he/she tends to see the market differently from the first time of analysis. He hopes that the trade will move in favor of him and neglect the factors which may change the market conditions.

3. Increase your position size accordingly. Increase your position size when you have an increase of maybe 10% of your account, this is to build up your trading capital. Likewise, you should reduce the lot size that you are trading when your account have reduced by 10%.

4. Expect the unexpected. In forex trading, always be prepared for both good and bad things. Understand those events and be prepared, so that you can take necessary actions when it happens to you. A good forex trading psychology is where you can take into consideration things that are unpredictable in the forex market.

For example, if the trade is going in your direction, you must have a mental preparation that it can go against you anytime, so that you will not be surprised if that really happens.

5. Remain emotionally detached. A good forex strategy is that you don’t check how is your trade going on every now and then. If you keep watching it, you are going to make wrong decisions I can guarantee you! This is because greed and panic may happen and therefore you adjust the trade. Just leave it to the market to hit stop loss or profit target once you have traded.

General Forex

Learn To Trade Forex – You Don’T Mess With The Forex Trading Signals

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Forex trading signals are a great way to help you protect your forex investment from not maximizing your profits and from taking too much in a loss. When you set up your forex trading signals, you are basically setting up the parameters to alert you of a trading situation.

Once your forex system is setup and tested to be profitable, don\’t mess with it. In other words, you set a limit as to where you would take the profit and at what losing point you need to get out of the trade, then stick with it.

Forex trading signals can be executed manually or using an automated forex trading system. The latter are basically forex trading software that can trade for you automatically. For example, if you are using the Metatrader platform, you can use forex Expert Advisor (EA) feature on the software to do automated forex trading. You can either run the EA on your own computer (which must be turned on for it to execute online forex trading.

Alternatively, you can run the EA on a Virtual Private Server (VPS). All you need to do is open an account with a VPS provider, log in to your VPS, and set up your EA like you normally would on your home computer. You can also set up any other forex trading platform on your VPS. Then, disconnect and go about your normal day and you can turn off your home computer without missing a trade!

Regardless of whether the forex signals generated is from manual or automated forex trading system, you have to be very precise when you set these limits as they are going to dictate when you enter and exit a trade. The exit strategy is key as it is the one guideline a trader must obey to avoid falling into the pratfall of trying to predict which way and how far in one direction or another the currency pair will go.

This is sometimes an area where a trader will fail as they do not listen to their own signals and they let their emotions get involved. Your forex trading signals are based on consistency in your trades and when you try and predict how much further the profit margin will go or think that the loss will go the other way and the currency trade will come back. You must follow the safeguards that you set up.

It cannot be stressed enough that you not only need to maximize your profits, but you absolutely must prevent yourself from taking losses that are larger than your acceptable margins. To pretend that you are not going to take a loss is foolish, they are going to happen from time to time and setting the proper loss signal will stop you from letting those losses get out of control.

One thing that you are going to have to do when setting up your forex trading signals, is not only develop an entry strategy, but they will also aid you in setting up your exit strategy which is just as important. When you do a deal, you absolutely must know where you are going to get out on both ends of the spectrum.

You still need to remember thought that forex trading signals are tools, they are not gospel on dictating what types of trades that you are going to get involved in. For instance, if your entry signal alerts you of a possible trade, you then evaluate the trade to see what your risk factors are and what your exit strategy is going to be. If those parameters are not acceptable, you do not do the trade. For that particular trade to be successful, you may have to expand your loss settings to be too wide of a range and therefore it is a bad trade.

General Forex

Currency Trading – He’S Just Not That Into Forex Day Trading

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To say forex day trading is not risky would be a lie because it is definitely the riskiest form of trading in the forex market, but you can make money if you know what you are doing and have the ability to contain your emotions in this high paced environment. The risk and tempo are what keep a lot of people out of this aspect of it and going the long term way.

I once had a student Alvin who attended my forex training course and one day, he asked me if he should go for forex day trading using the forex scalping methods I’ve thought him. I told him forex day trading may be lucrative but may not be suitable for everyone. I went on to analyze the pros and cons of forex day trading with him.

Firstly, something that is a draw to forex day trading is the fast trading cycle. Many traders like the rush and potentially, it could actually be more fruitful than long term trading. Each individual trade may not make as much as a long term trade, but because you may be making 10 trades to every one of theirs, if not more, your profitability can actually be higher than that of the long term forex trader.

Another drawing characteristic of day trading is that you do not have the overnight worries of the long term trader. Your money is out of the market at the end of the day and if anything happens to affect the currency of a certain country, you just roll over and go back to sleep. The long term investor will be chewing on their nails waiting for the market to reopen.

Of course, with any positive there are negatives that have to be considered. The first of these is that the plain fact of the matter is that about 4 out of every 5 people that day trade end up losing money. There are several reasons for this. One of them we have already mentioned in the risk factor and another is that traders are pulled in by the lure of making very fast money and don’t do the work that is necessary to be a successful day trader.

Also, a lot of the people that are day trading are doing so on borrowed money. They are leveraging against their forex account and they end risking too much on one trade and then they end up in massive debt when a trade goes bad. It is not the forex market that is causing this, it is the trader that is not putting in the necessary work and effort to be an effective day trader.

Another thing about forex day trading you should know is that it will take up quite a fair bit of your time as you need to monitor the forex market very closely. Some part time forex traders overcome this by using automated forex trading system that trades for them.

If you’re having a full time job, it can also be quite distracting. Having heard my analysis, Alvin said he’s just not that into forex day trading as he has a full time job and he does not have the time to monitor the forex market. Also, he said he does not need the extra excitement as his job is already stressful enough for him.

If you are still interested in day trading and have the time, give it a shot, but just do it conservatively. There are plenty of very successful day traders, but they take the time to create a successful forex day trading system that works and gives them an overall profit day in and day out. If you find that it is too much for you, just explore the long term aspect of this market niche as there is plenty of money to be made!

General Forex

Forex Technical Analysis – Using Forex Charts for Bigger Profits Part 1

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Here we are going to give an introduction to using forex technical analysis and using forex charts for bigger profits. Forex technical analysis if done correctly is the best and most time efficient way of seeking profits and should be considered as part of any forex trading strategy.

The first point to keep in mind is:

Forex technical analysis is a game of odds not of certainties, so forget about predicting with scientific accuracy, no one can achieve that – but if you understand the following equation, you can make big forex profits:

Fundamentals + Investor Psychology = Price

It is a fact that the fundamentals have an influence on price – all investors have the facts at their disposal but they see them in their own way and this mass of millions of people determines forex prices.

Investor psychology

Human psychology is constant and never changes.

Traders will always be influenced by emotion and these emotions of greed and fear, will push prices to far away from fair value and these price spikes are easy to see on forex charts.

The important point to keep in mind is that investor psychology repeats – and so do chart patterns.

Seeing the Whole Picture

Another very important point to keep in mind with forex technical analysis is that it studies the fundamentals.

All it does is simply assume that in today’s world of instant communications, they show up straight way in price action.

Studying forex charts however does something more:

It studies how investors perceive the fundamentals.

Its is not enough to simply look at the facts, as we all draw our own conclusions from what we see and emotions ensure that investors don’t act logically – they push prices to far ( either up or down) based upon their emotions.

Studying forex charts gives you the whole picture – it reflects the fundamentals and more importantly, how investors perceive them.

When using forex charts you don’t care how and why prices move, you simply look at the reality of price and try and make profits from the moves.

It sounds simple as a concept and it is – but it’s extremely powerful and if you incorporate it in your forex trading system, you can make big profits by trading when the odds are on your side.

Forex Technical Analysis Is Time Efficient

Using forex technical analysis is time efficient, you are studying price and don’t need to make assumptions of where they may go based upon the news – you can see the price as it is and simply trade the truth.

Many traders continually look at news and try and trade off it – but this is hard – the fundamentals are discounted instantly and you have very little chance of winning. Furthermore, if you look at the opinion of others your emotions get involved and any trader who lets emotions dictate their forex trading strategy, is destined to lose

Trading forex charts lets you see the reality as it is – no opinions or guessing and that gives you a huge advantage when trading for profits.

Forex Charting is An Art

Of course, all people use forex charts in different ways and it’s an art not a science.

It is similar to being a ships captain – use your charts correctly and you can get from A – B safely and earn a living; use your charts in the wrong way and you will hit the rocks and drown.

There are many myths perpetrated about using forex charts and if fall victim to them and you will lose.

The good news is anyone can become a successful forex chartist and if you follow basic rules, you can trade with the odds on your side and execute your forex trading signals correctly and win.

In part 2 of this article on forex technical analysis, we will look at basics points to incorporate into your forex trading plan, to be successful and look at common myths regarding forex charts you need to avoid.

General Forex

The Joy of Automated Forex Trading

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Automated forex trading is setting the trend of the time. In this type of forex trading, Forex robots known as expert advisors are fully automated forex trading software that have come to the rescue of an average person who has interested in investing money in the forex market but is unfortunately not able to do so due to paucity of time. The phenomenon of automated forex trading has gained momentum within a short span of time and today almost every forex trader is going for one or the other kind of automated forex trading system that can enable them to make big money without any hassles.


Automated forex trading offers a plethora of benefits over self directed trading. Most of the self directed forex traders suffer from two major shortcomings; one being emotions tend to interfere with the strategy of forex trading and the other being that money is often managed poorly. Let us take each of the aspects one by one. Considering the former aspect of emotions, greed and fear often create problems for the forex trader and inhibit his/her thinking. What happens is forex traders who rely on their own judgment tend to close their position too soon due to fear and on the other hand, their greed compels them to keep their position open for too long. It is because of these emotions that they suffer losses and thus move out of forex market soon. It is here that automated forex trading more popularly known as forex robot comes into play.


The second issue is that most of the self directed forex traders fail to mange their time effectively and this in turn leads to poor money management. Automated forex trading does not give rise to these kinds of problems and is thus highly preferable. It is not that in automated forex trading, you have no control over your forex trading transactions. It’s just your forex robot or expert advisor that will follow the pre set instructions and this way enables you to concentrate on the more important issues. As far as the instructions are concerned, either you give the instructions or your trading mentor and then your automated computer program will take care of rest of the things and keep doing as you want things to be done.


You can set as many parameters as you want such as you can give clear specifications regarding the price pattern, averages, trading rules, technical indicators, market trend and many more. The system will identify your requirements and develop an algorithm which will work for you automatically.


There are varied kinds of automated forex trading systems available online. Some of them are offered for free while others are chargeable. The two most commonly used automated forex trading systems are desktop based systems and web based systems.


The first one is not very popular as there are some limitations associated with its use. Since the entire data is stored in the computer, it is highly prone to virus attack. Also, this system is likely to face some security issues. If a problem crops up in the computer, it is tough to retrieve the data. On the contrary, web based forex system is hosted on highly secure servers and thus there is greater reliability. It can be accessed from any computer having internet connection and is compatible with almost every internet browser.


To conclude, in the contemporary time, more and more people are becoming aware of the benefits of using automated forex trading systems.