Tag Archives: Trading

Forex Trading Articles

Forex Trading Terms For Beginners

As you enter the Forex trading world you might be introduced to a number of different terms. You may not know what they mean, and you might need further explanation.

Understanding Forex trading jargon is vital to your success as a trader. Therefore, some of the most commonly used terms are defined below:

Bid-This is what the buyer of a currency would be willing to pay for a foreign currency. This amount is usually based on current market trends. This is the price that the seller is usually expecting to pay in order to purchase currency they later can sell for a profit.

Ask-This amount is what the seller is expecting to make when selling a particular foreign currency. Just like the bid it is based on current market price. It may not be exactly what a seller will get but it is the goal of the seller to make a profit and sell for at least the current market price.

Spread-The simplest way to define this term is this: It is the difference between ask and the bid price. This is the key to profit (or unfortunately sometimes to loss).

PIP-The smallest price of a currency is referred to as this. Calculations based on this unit is what helps figure out exchange rates more accurately.

Base currency-The currency that you start with is called by this term. It would be compared to another (base currency to determine exchange rate, as well as profit or loss.

Secondary currency-This term is used to describe the current that is exchanged with the base currency. For instance, if you originally traded in the British pound and want to switch to the American dollar the American dollar would become the secondary currency.

Margin-When referring to working with a broker this term is usually used. It is the amount that you would be expected to deposit in a new financial account opened. It is also the commission that would be paid to a broker every time a trade is made.

Leverage-This term describes the weight of a margin. Forex trading deposit accounts are usually set up in this way so that large amounts of security deposits are managed with as little capital as possible.

Margin call-This is a phrase that is used to describe a time when a trader’s deposit does not even cover the transaction made. It is in some ways like having taken out a business loan and not making a profit. Worse yet, it could be a significant loss.

Currency pair-This is simply the two different mediums of financial media being exchanged. It is made up of the base currency and the secondary or “quote” currency. A trading duo such as this can also be thought of as a single unit being bought/sold.

Volatility-This is the measure of the amount of risk involved in making a specific Forex trading transaction. This is an evaluation tool that helps determine whether making a certain type of investment is potentially profitable or not.

Clearing price-The value of a currency pair is described by using this phrase. It is the specific monetary value assigned to a security or asset and it is determined by current bid and ask price.

Forex Trading Articles

Fx Trading Hours – Three Advantages Of Forex Trading Hours

Forex trading hours give investors three wonderful advantages. These investors can work any time from Sunday afternoon through Friday afternoon. Because the market is always open somewhere, the market instantly reacts to worldwide events 24 hours a day. Best of all, investors make money while they are sleeping. Successful investors understand what Forex is and how it works.

As the largest financial market in the world, Forex trading, which is short for foreign exchange trading, cannot be manipulated by any one country or industry. Every trading day between 1 billion and 1 1/2 billion dollars is exchanged in this active marketplace. The commodities are the values of different countries money and are traded in pairs. The seven most popular currency pairs are Euro/US dollar, US dollars/Japanese yen, Great Britain Pound/US dollar, US dollar/Swiss franc, Australian dollar/US dollar, US dollars/Canadian dollar and New Zealand dollars/US dollar. Currency investing is simple; good news for one country is usually bad news for another. When the price of oil rises, oil-producing countries make more money causing their currency to be worth more.

Investors can work any time with the expanded Forex trading hours. Part-time traders working around a full-time job enjoy the flexibility and freedom. For example, the Australian market opens at 5 PM Eastern Standard Time, followed by Tokyo at 7 PM, Singapore/Hong Kong at 9 PM, Frankfurt at 2 AM and London at 3 AM. New York City, of course, opens at 8 AM and closes at 5 PM.

No matter what happens in the world, the market is ready to react. If war erupts in an oil-producing country, all of the countries affected have changes in the value of their money. Good economic news in the United States increases the value of the US dollar while higher than expected unemployment claims reduces this commodity.

The most exciting advantage to Forex trading hours is investors can make money while they sleep. Because the market is actively trading around the clock, the value of the currency pair changes from minute to minute. Investors able to correctly forecast the value of money reap great rewards as the market rolls from one time frame to another without shutting down.

As Forex trading hours allow people to choose when they work, they can work any time from Sunday afternoon until Friday afternoon. Because the market does not close during this time, this marketplace responds quickly to anything that happens. Finally, investors make money while they sleep.

General Forex

Forex Trading Courses

If you’re looking to cash in on day trading on the foreign exchange market, also known as the Forex or FX, Forex training is a great place to start. Understanding day trading and developing a trading strategy is difficult, so don’t try to go it alone. Whether you’re completely new to trading, or you’re an established trader that’s struggling with the market, a course in Forex trading can help you increase your earning potential. Day trading courses are available to help you get into this great career or hobby today!

Forex training will teach you the ins and outs of the foreign exchange market. You’ll learn how to interpret FX currencies trading information to spot which currencies are trending up or down. You won’t have to go it alone – day trading courses offer guidance and feedback. Forex courses are taught by professionals that are experts in the field of day trading. These are people that have made a career out of day trading, and they’re ready to show you how to do the same. If you’re having trouble spotting profitable currencies, an instructor will work with you, explain in detail what you’re looking for, and make suggestions to improve your trading strategy.

Learn real trading skills that will make you money:

– How to get into forex trading, including information on investment needed to get started
– How to spot profitable trends on the foreign exchange market
– How and why to buy and sell currencies
– Managing profits and losses
– Balancing your investment portfolio for optimum performance

You’ll learn how to utilise computer applications to keep constant track of currencies that are trending up and down, on a daily, monthly, and yearly basis.

Forex trading is a proven money-maker, but you have to have the skills and the know-how to become a successful day trader. Trying to figure out the foreign exchange market on your own is nearly impossible unless you’re already well-versed in the field of finance. Don’t spend a penny of your hard-earned cash on foreign exchange trading before you learn how to do it right. Courses are available in person and online, and can have you day trading in a matter of weeks! If you’d like to start a money-making hobby or begin a lucrative career as a Forex day trader, sign up for a traders’ skills course today to make your financial dreams come true!

Forex Trading Articles

You Too Can Make Big Profits in Forex Trading

Currencies are traded in the Forex market relative to other countries currencies. This unique interaction results in currency being exchanged in pairs. For example, the Euro can be traded against the Dollar. Therefore you can buy a currency pair of EUR/USD (more on that later), which represents how many US Dollars one Euro is worth. Forex markets do not have a physical site, meaning there isn’t a big building on Wall Street where a bunch of people yell and waive dollar bills in an attempt to get other people to buy them. Instead, the Forex Market is considered an Over-the-Counter (OTC) market as it is run entirely through a continuous network of banks and brokers. This does not mean you purchase currency at your local drugstore, it just means that there isn’t a centralized location for exchange like many of the famous commodities markets.

The basic goal of Forex trading is to swap one currency for another currency then cross your fingers and hope the currency you bought will increase in value relative to the one you sold. Then once it increases in value you sell it back in order to receive more of your original currency in exchange.

The Forex markets involve a web of currencies from around the world, and currencies fluctuate in value frequently. A Forex trader will try to make a profit in the foreign exchange market by taking advantage of these market movements.

There are hundreds of currencies throughout the world (most of which are tradable) but there are several key currencies which account for the majority of Forex volume. The most popular currencies are referred to as the major currencies. The majors are as follows:

* Dollar (USD) – United States
* Euro (EUR) – European Union Members
* Yen (JPY) – Japan
* Pound (GBP) – Great Britain
* Franc (CHF) – Switzerland
* Dollar (CAD) – Canada
* Dollar (AUD) – Australia
* Dollar (NZD) – New Zealand

Types of Forex Markets

There are three potential markets for a Forex investor to Trade currency. These markets are: the spot market, the forward market, and the futures market. The spot market is currently the largest market for exchange, however in the past the futures market was popular since investors could hold currency for long periods of time.
The spot market is where currencies are bought and sold according to their current price. A particular currency is exchanged for another currency based on the currently agreed upon exchange rate. These exchanges are typically facilitated by either a broker or a bank.
In the futures market, contracts are bought and sold based upon a standard size and settlement date on public commodities markets. Investors agree to buy or sell a fixed amount of a specific currency at a fixed exchange rate on a fixed date in the future.

Forwards markets are similar to futures markets; however the terms of a contract between two parties are determined by solely by the parties involved and don’t have to be based on a public commodities market.
Forwards and futures markets are often used to hedge against trades made in the spot market. Some investors will specialize in one type of market while others will try and use all of them to their advantage.

Forex trading is an exciting and fast-growing marketplace. Exciting opportunities exist as Forex trading continues to evolve and grow.

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Forex Trading Articles

Swing Trading Strategies – How You Use It

A swing trader usually has his trades open from days to weeks. Keeping a position open for that long can be quite risky, especially in forex market where the market movement is really volatile, thus you’ll need solid swing trading strategies. These strategies can be applied by all traders, but it’ll be easier if they match your trading style.

Identifying the Trend

The purpose of swing trading is entering trades in the direction of the major trend. Thus, identifying the trend is an extremely essential initial step to master for a swing trader. The sooner you can identify the trend, the higher your chance to get massive profits.

The problem is aside from identifying a trend, you have to be able to avoid whipsaw (a condition where a sharp price movement is quickly followed by sharp reversal) too. It can be misleading and looked just like the market is trending, so make sure you can avoid it. These are several common methods to discover trends:

– Making use of indicators: probably the most widely used indicators are Moving Averages and Relative Strength Index.
– Price Action Trend
– Pivot Point Trend
I recommend using 15 minutes and 4 hours charts for this.

Look Forward To Pullback

As soon as you identify the main trend, don’t rush and place your order. Wait for some kind of pullback first to get a good entry point. By waiting for a good price level before truly entering the market, you’ll enter at a great price and have much better opportunity to score winning trades.

Stop Loss Order

Every good trader implements strict risk management and stop loss is one of it. For stop loss, just use the latest swing high or swing low. Make sure you place your fund in a trusted broker that won’t ignore your stop loss.

Exit Point

The easiest way is to shoot for exactly the same quantity of the pips you are risking. Illustration: if your stop loss is twenty pips below your entry point, then just set 20 pips above your entry point as the exit point (take profit order). Needless to say, it’s possible to aim higher than the amount of pips you risk; it’s completely up to you.

This is just one example as there are a lot of swing trading strategies out there. A few of them may need you to learn more advanced strategies or making use of more sophisticated software; nonetheless, if you’re still learning, it is advisable to stick to one currency pair and get used to it. Also, know the best time to trade for that specific currency pair.

There are hundreds of strategies variation for swing trading, but the fundamental is the same: finding a trend and ride on it to get as much profit as you can. Just like that. People just discover a lot of different way to do that, so just go with one that suits you the best.