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Forex Trading Articles

Forex Strategy Trading Guidelines Learn The Essentials Of Trading

Forex strategy trading is an unusually money-making investment to get into. It is the exchange of foreign commodities internationaly sold for a profit determined by what the market us doing.

The market is originated by the individual speculators, the banks, and many other international corporations that make up the more than 4.3 trillion dollars of trading volume that takes place on a daily basis. On the other hand, there are still lots of people who are puzzled as to exactly what Forex trading is and how it works. As a result, in this short article I am going to explain it very simply so that you get the fundamental concept down.

With Currency Trading you buy currencies at an exchange rate for another currency, both currencies together are called a currency pair. To illustrate, you might exchange the Canadian dollar for the Japanese yen or you may exchange the New Zealand dollar for the Mexican peso.

You are going to use the American dollar as the unit to figure out what the value of the other currencies are, because the less the American dollar is worth the less of any international currency it will buy you. This rule applies to every other currency as well.

If the currency would get you less in US dollars then the currency isn’t worth that much.

What you are trying to do with Forex strategy trading is make what it known as a pip. a pip is the smallest movement a currency pair can make. Decimal format is utilized to assess the exact exchange rate for currency pairs internationally.

To be more specific, a US dollar might get you 1.5617 Euros. You make a profit when the number moves up a point(or a pip). The more this number moves up the more pips you make. A pip can be a unit of twenty dollars, ten dollars, or less depending on what type of account you are playingtrading with and the size of the lot.

Trading the foreign currency is not like the stock market where they are dictated by the SEC. In Forex most of the trading is done through online trading platforms and a network of banking brokers.

A big part of the money that is exchanges comes from only five percent of the market banks and big companies.

The other 95% comes from smaller market players who may have a few thousand dollars in their account to play with.

Of course there is a lot of technical jargon involved like, Fibonacci retracement, which tells you where the level at which a market trend will break, and fundamental analysis which simply means information you are fed over the news.

These kinds of terms frighten a lot of beginner foreign exchange traders, but trust me they are easy to learn and there is no reason why you can not pick them all up.

The main principle is to buy one currency at an exchange rate that will move up enough in value to be able to buy more of a currency which is worth less now because of the boosted value all centralized around the US dollar.

The 0.0001 example I gave above is spot on for most of the major markets, but for the smaller ones sometimes the price might be measured differently.

I hope this article has been useful in assisting you to comprehend just how Forex strategy trading works.

To your success,
Jay Molina
Senior currency trader & coach

Forex Trading Articles

How To Create And Share Your Forex Trading Strategy With The World

Due to the advances in technology, forex trading (currency trading online) is accessible to pretty much anybody who wants to start trading forex. The marketing of different conservative, aggressive, scalping, news and automated trading strategy ideas show how alluring trading forex markets is to the population. In other words, forex markets are no longer limited to those with high net worth or bank trade teams.

In any power trading strategy, a proven trading method will mean that through forex strategy testing and by using trading risk management, no more than one or two per cent of a total account value is put at risk in a single trade. This is key in the path to big forex profits. In order to start trading forex, any breakthrough strategy will start with the basics and have clear forex trading strategy rules set out so that at least part of the trading is automated in terms of the decisions that need to be made whilst trading spot.

Hence, making money with forex trading (currency trading) can mean making big forex profits. It also means that trading risk management must be in place or else there is a real risk of wiping out an entire account. You could just go right ahead and download some brokerage charting software and start forex trading today if you wanted to. The way to start is so simple these days and leverage provided by forex brokers enables practically anyone with anything to invest (literally) to be able to start with a forex trading strategy.

Predicting forex prices from forex trading tips is not enough it must be stressed. Whilst there is no reason you cannot get a good forex education online, or even pick up some forex trading online tips from a forex trading guide, if you want to make money with forex trading, you simply must have a sound currency trading strategy.

Currency trading strategy rules for a forex business can be developed by amalgamating forex trading systems of others or simply garnering a forex education to include: fundamental and technical analysis; trading money management (risk management); a daily forex strategy briefing from a “third party” and a way of creating forex forecase signals (in other words a means of predicting future forex prices from perhaps a technical setup on a currency pair or simply from forex strategy testing that has been carried out.

Forex strategy testing can either be done through using a practice account through your broker or by paper trading your strategy. A third option is to use software such as forex strategy tester which can run a simulation of what could happen if you trade by your rules with some limitations on accuracy.

Researching forex trading tips on the internet will find any trader millions of websites offering services from paid-for technical and fundamental analysis to free forex ebooks webistes right the way through to a breakthrough strategy that may “promise” to enable you to become proficient in predicting forex prices or giving you an aggressive forex trading strategy that promises to allow you to cash in and make big forex profits from a power currency trading strategy.

Predicting forex prices has become a forex business in itself with companies offering forex forcase signals which aim to predict the forex market prices and give trading ideas on an intraday, daily, weekly and monthly basis for the different trade styles.

Your trading strategy is going to evolve through the hurdles and hoops that anyone who wants to create forex trading strategy rules needs to go through. A power trading strategy is possible, but to make big forex profits is going to take a lot more than one of the free forex ebooks webistes out there today. Indeed predicting forex prices is going to be a journey and not a destination for the rest of your trading career as no one gets it right all the time – not even the latest “breakthrough automated trading strategy”

What that means is that your forex business runs largely like an automated trading strategy, only with the input of your knowledge from what you have taken in learning to trade forex online. To make this happen, you will start to think about what you may need in order to implement your trading strategy. For example, will you be needing a daily forex strategy briefing from either a paid service or a free provider of forex strategy briefings – such as perhaps your broker or a third party service.

Your charts created by forex trading software will give you a pictorial representation of what has been happening up to present in the markets and enable you to make predictions of forex price movements by learning and applying various indicators. Alternatively forex brokers may provide forex trading tips through charts they have paid employees or third parties to create to help or give ideas to their clients.

Some online forex trading tips websites may be able to offer professional opinions on the current market action. However this is no substitute for learning online currency trading for yourself and starting forex trading with your own strategy – you could even share your forex strategy with others.

So it’s also important to work out the forex trading costs in terms of time, investment in forex education and starting a forex business.

Forex Trading Articles

How To Make Money In The Forex Niche – Some Alternative Approaches

Every year thousands of people enter the forex niche. Some go on to become highly profitable traders, whilst others end up losing money. However it’s important to point out that there are many ways you can make money in this industry.

It may be the case that you are making some decent profits from your trading, but are still trading relatively modest amounts. In which case you will probably want to find a way to make a little extra money, and one way of doing that is by selling your trading signals.

If you are a profitable trader, then your trading signals will always be in demand from other traders. So you could either start up your own website and promote it heavily in order to attract monthly subscribers, or you could sign up to an automated signal provider and let people access your signals this way instead.

There are a few of these websites up and running now and they work by bringing signal providers and people looking for signals together. The visitors can subscribe to as many providers as they like from one central website. As a signal provider you will get a small commission per trade per subscriber, so you can make a very nice income if you are a profitable trader because you will inevitably attract many subscribers.

The second way you can make an additional income from forex trading is by selling your trading system, or creating some kind of information product detailing everything you know. Again if you have a proven system in place and are clearly a very successful trader, then you should have no problems finding buyers for your product.

You can take this one step further by getting in touch with some of the main bloggers and marketers in this niche. These people will have very large email lists so you can offer them a commission for every sale that they generate in order to encourage them to promote your product to their list.

One final way you can make some extra money is one that is ideal if you are not yet a profitable trader. You can simply set yourself up as an affiliate marketer and promote various products that you come across, that other people may be interested in buying. Product owners will often pay a sizeable commission (sometimes as high as 50-75% per sale) so this alone could provide you with a full-time income.

It is certainly a lot less stressful than trading the markets yourself. All you do is create a website or blog and set about building an email list so you have a large list of prospects. Then you can sign up to affiliate programs and do deals with product owners to start making some sales and generating some serious cash.

So the point is that there are a lot of opportunities in the forex niche. If you are making money from trading, then you have even greater opportunities to make even more money. However even if you are a poor trader yourself, you can still make a big profit from promoting various products and services in this niche.

General Forex

Forex Trading Tips – Prepare Yourself Well Or Lose Everything

There are iron rules in each business and ignoring these rules will make the players kicked out quickly from the game, this is also applied in forex trading. Apply these forex trading tips in your trading career to make steady profits, keep your account save, and play by the rules:

1. Never Make An Entry Without Doing Analysis First

There area always times when you will stumble upon something that looks very promising, perhaps from news or trends. These ‘hunch’ may bring you profits once or twice, but it just coincidence, you will never survive in forex trading if all that you got is ‘hunch’ instead of proper analysis and logical decisions.

This has happened to the majority of the traders when they started; they manage to make a profit by speculating, thinking that they already master the secrets of forex trading, and start giving forex trading tips to their acquaintances. This attitude is identical to a gambler in a casino: throw the dice and pray. You’ll be thrown out from the game in no time with this kind of attitude.

2. Learn Step by Step

Foreign exchange has many factors and elements; it is purely not possible to grasp it instantaneously. If you are a novice, do not deposit USD10,000 in your new account and have various tests with it. Trading currency is similar to gambling; when someone lose, there are always a winner at the other side. These winners will finish your USD10,000 in no time and by reading this forex trading tips you have learned to avoid it.

The best ways to go is take it slow. Start with a practice/dummy account while learning. It is possible to test a variety of methods, currency pairs, robots, and signals there without concerns. If you have discovered a system that is effective, you can proceed to a mini account for further test. Nevertheless, if you have confidence in your system, go ahead and open a live account.

By “system that works”, I refer to a system that can generate profits on regular basis at the end of the month without you have to spend your entire time maintaining your open positions. If you have confidence in it, learn to control your emotion and allow it to do the work.

3. Utilize Trusted Forex Trading Platform/Forex Broker

No matter how good your system is, trading in a poor quality platform will ruin your opportunity to gain profits. Usually, you will get free trading platform from your broker; these are what you need to look in your trading platform/forex broker:

– Support all currency pairs that you interested in. At the minimum it must support popular currency pair like EUR/USD, GBP/USD, and USD/JPY.

– Allow you to put take profit and stop loss order; this is very important risk management method.

– Provide charting feature, news feed, advices, and research material; to make it short: all that you need to make proper analysis. If possible, a daily forex trading tips can be beneficial as well.

– Customer support available. If possible, get the one that provide 24 hours support so you can contact them any time when you get problems.

– Currency trading is a global business, so it is great if your broker take deposit in multiple currencies.

– Simple procedures applied in their services, including withdrawal.

4. Figure out how to Use Stop Loss and Take Profit Order

Stop Loss and Take Profit is orders that you put to close your position at certain price. Instance: you buy GBP at 1.678; then you place Stop Loss order at 1.648 to limit your loss by 30 pips. You also put Take Profit order at 1.708 which means you will close it when you get 30 pips profit.

This is important so that you can prevent your emotion to take part on the “close decision” and screw it up. If the market is move against you, you won’t close the position since you are hoping the market to swing back to your side, thus turn potential loss into profits. In most cases, this will only bring you more losses. This is very important since it is the cause of many traders falls. If you don’t remember everything that I mentioned in this forex trading tips, remember this: emotion is only going to make your trader career short.

Other possibility: the market moves in your favor and you start to gain profits, but you still hold it because you want even larger profits. You can ever predict when the market will moves against you and when it really does, it will be already too late. In both scenarios, greed is the one in movement. But when logic dictates, you can control greed.

Main point here: you should not rush everything when you learn or trade forex. Take your time to learn the rules, test, practice, analyze, and read several forex trading tips for the day. However, I don’t recommend you to do it by yourself since it can be long and painful process.

Forex Trading Articles

How To Engage In Profitable Forex Trading

Markets are known to reward those who pursue correct behavior. Our whole economic paradigm is based on the market structure and there is no bigger market in the world than the forex market. This is why forex trading is one of the most rewarding professions in the world today.

Here are some guidelines on how to do this profitably.

* Seek Expert Advice: Currency trading is very dynamic and you need to be up to date with all the happenings in the world. This quite honestly is impossible. There are a large number of central banks, dealers and other participants that may have more information than you. As a retail investor, it is impossible for you to keep track of all of these. So if you cannot beat them, join them. However, be careful whose advice you heed. Test their records and align yourselves only with the best.

* Cut Transaction Costs: Transaction costs have a tendency to eat chunks of your profit. The world’s greatest investors, Warren Buffet and George Soros, are very averse to transaction costs. FX Trading requires constant buying and selling and transaction costs have a potential to dent your margins largely. The best intermediaries will often have the best costs because of their large transaction bases. This is another benefit of aligning yourself with the best.

* Understand Derivatives Instruments: Derivatives instruments are what make foreign exchange markets exciting. They offer you leverage, which enables you to amplify your profits. However, at the same time, they also create risk, which needs to be managed. There are various strategies available, which enable you to hedge risk. This means you can decide the upper and lower range of possible outcomes. What’s more, instruments such as options allow you to get asymmetric payoffs, which mean that you can control your risk while maintaining full upside potential. The largest volume of derivatives instruments is traded on the forex market and its total value is close to seven times the GDP of the entire world! There is a lot of money to be made and there are options to control your risk too.

* Technical Analysis: Apart from predicting movements based on current events, analysts use statistics to predict movements. They create charts and identify patterns that repeat. On an average, these people make more returns than the market because the market tends to behave in similar ways repeatedly. Ensure that you are in touch with a technical analyst and make a decision only after considering both fundamental and technical analyses.

Forex trading requires understanding of the marketplace and the instruments available. Explore your options well. Perfecting the marketplace is a utopian strategy that can get you stuck in an endless analysis paralysis loop. Most investors tend to get better with time. Start with smaller bets and ensure that you do not risk too much on one bet. Spread them over time and currencies for steady profit.