Where to Get Forex Training
November 25, 2008
For those of you who are interested in forex trading, you may want to start off by getting some good forex training. Forex training is a necessity for anyone with this interest. This is because a lot of money is involved in forex trading. If you don’t get some forex training, you are bound to lose a lot of money.
Some of you may not even know what forex trading is. If you don’t know this, you defiantly need some forex training. Forex stands for foreign exchange. Forex trading is basically the exchange of one countries currency for another countries currency. This is done simultaneously in hopes of gaining a profit.
You can get forex training from several different places. The first place you should get forex training from is online. There are many websites that offer free forex training. The forex training these websites offer is both reliable and accurate. The forex training on these websites often offers a free demo account to teach you how to trade without actually using any real money.
How To Control Fear And Greed In Trading
November 16, 2008
There is an old saying that the market is driven by fear and greed. Anyone that has placed more than a couple of trades will surely have experienced these two emotions.
All traders experience emotion. The distinction between a successful trader and an unsuccessful trader comes down to how they deal with that emotion. Let’s look at how these emotions affect a successful trader and an unsuccessful trader in various scenarios:
1. The trader’s three previous trades have been losers. The unsuccessful trader will consider this before placing his next trade and be fearful that this trade will also end up a loser. This might result in a delay in placing the trade whilst waiting for the price to confirm that they were right - thus missing a perfectly good entry. They might suddenly discover that some other factor, previously unconsidered, is a reason not to enter the trade at all. Basically they will be fearful of another loss.
Getting a Forex Trading Education
November 9, 2008
Many Americans are interested in getting involved in forex trading. Before doing this, you should get a forex trading education. You should never get into forex trading without forex trading education. With the proper forex trading education, you can be on your way to making a tidy profit.
First you need to understand what forex trading is. Forex is short for foreign exchange. Forex trading is the simultaneous exchange of one countries currency for another countries currency. By doing so at the right times, you can gain a profit. A forex trading education can teach you how to do this.
The first part of a forex trading education is to learn the market background. The foreign exchange market is always changing. With forex trading education, you will learn how to monitor these changes to be beneficial for you.
The next part of your forex trading education is to learn about risk control and risk management. You learn to control yourself and not over invest at the thrill of the chance of making money. You will also learn how to cut your losses (how to exit losing trades before your losses exceed your limits). You will always lose money when you first begin forex trading. This part of your forex trading education is absolutely crucial to whether you will make it big or end up in a hole.
Sending Signals for Trading in Forex
November 1, 2008
Forex signals are sent by a forex firm to their subscribers in order to buy and sell currencies. These signals are called entry and exit signals for the forex dealers. The firms, which send this forex signal, do so after tedious and meticulous research and analysis into the currencies that their dealers are trading in. For example a firm may send the entry and exit signals at designated time frames in real time. These will remain valid for a short period only after which they are going to be different.
Let’s say that there is a forex trading company say Acme Forex traders who send entry and exit signals to their clients in the following way
The first signal is provided to the trader at 08:30, and this signal is going to remain actual till 12.30 The trader will receive the second signal at 12.30, which would remain actual till 16.30. The last signal would be sent to the trader at 16.30.
The transactions are given according to GMT. Please adjust for local time changes. The transaction shall be calculated till the signal is actual. The charges would be $300 per month per trader.
FOREX Trading Philosophy
October 25, 2008
Keen on starting FOREX trading? Why would you not be? Many beginning FOREX traders are captivated by the allure of easy money. FOREX websites offer ‘risk-free’ trading, ‘high returns’ and ‘low investment’ ? these claims have a grain of truth in them, but the reality of FOREX is a bit more complex. As with anything in life, what you put in will determine what you get out.
There are two common mistakes that many beginner traders make ? trading without a strategy and letting emotions rule their decisions. After opening a FOREX account it may be tempting to dive right in and start trading. Watching the movements of EUR/USD for example, you may feel that you are letting an opportunity pass you by if you don’t enter the market immediately. You buy and watch the market move against you. You panic and sell, only to see the market recover.
This kind of undisciplined approach to FOREX is guaranteed to lose you money, and have you waste your time. FOREX traders need to have a rational trading strategy and not allow emotions to rule their trading decisions.
6 Critical Factors For Successful Trading
October 17, 2008
Success in any profession can be broken down into a number of critical factors. Trading is no different. Does your trading tick all 6 boxes or are there any areas you need to work on:
1. Do you have an edge? Trading futures is a zero sum game - you must have an identifiable edge over the other market participants. Have you identified a high probability pattern that can be exploited time after time? Remember though, the only constant in trading is change - you will have to constantly evolve your trading edge to stay ahead of the crowd.
2. Disciplined Execution. There is no point in identifying an edge if you can’t execute the trade. Measure your trading success against your trading plan not the actual outcome of the trade. If you make a loss but you executed your trade exactly according to your plan than pat yourself on the back, don’t beat yourself up over it.
3. Money Management. If your risk per trade is too aggressive then you run too high a risk of blowing your account, too conservative and you will not optimize returns from your system. It is essential to establish the maximum expected draw down of any system and set money management rules accordingly.
FOREX - Where Fortunes Are Made Everyday
October 9, 2008
The Foreign Exchange Market ? better known as FOREX - is a world wide market for buying and selling currencies. It handles a huge volume of transactions 24 hours a day, 5 days a week. Daily exchanges are worth approximately $1.5 trillion (US dollars). In comparison, the United States Treasury Bond market averages $300 billion a day and American stock markets exchange about $100 billion a day.
The Foreign Exchange Market was established in 1971 with the abolishment of fixed currency exchanges. Currencies became valued at ‘floating’ rates determined by supply and demand. The FOREX grew steadily throughout the 1970’s, but with the technological advances of the 80’s FOREX grew from trading levels of $70 billion a day to the current level of $1.5 trillion.
The FOREX is made up of about 5000 trading institutions such as international banks, central government banks (such as the US Federal Reserve), and commercial companies and brokers for all types of foreign currency exchange. There is no centralized location of FOREX ? major trading centers are located in New York, Tokyo, London, Hong Kong, Singapore, Paris, and Frankfurt, and all trading is by telephone or over the Internet. Businesses use the market to buy and sell products in other countries, but most of the activity on the FOREX is from currency traders who use it to generate profits from small movements in the market.
Forex Training: Follow Your Gut or Your Broker
October 1, 2008
Which way will the forex market move? Do you just follow your gut feeling? Or do you have Neo’s sixth sense that would let you be one with the market and feel the underlying currents.
Trading forex is a non stop action movie but a good one, where you really don’t know who will win at the end. Every forex trader is trying to predict the winner of his own movie.
The forex markets move fast. Can we understand why they move? Yes, we can but only by having a feeling for the market, the instinct to know in which direction to move. Will our intuition enable us to predict the forex markets every move? Of course not. But understanding what makes the markets move will give the edge in making better trades.
What do we need to know!
- Who trades forex?
Traders, investment funds, corporations, banks and governments.
- Why do they trade?
Traders go for a quick speculative profit. Investment funds avoid risk and follow the long term trends. Corporations are trying to hedge on currency fluctuations. Banks are short term traders, market makers and hedgers. Governments trade currencies to keep there countries markets stable.
Psychology Of Trading
September 24, 2008
The psychological aspect of trading is usually underestimated by those new to trading. The psychological problem for most traders is the fear of losing - ironically it is this fear that causes most traders to lose money in the long run. The fear of losing can manifest itself in a number of ways:
Unable to pull the trigger and enter a trade. A trader can start to lose faith in a system that has produced a number of consecutive losing trades and might start to look for further confirmation before taking the next trade. Inevitably the trade that is not taken will be the winner. The point of a mechanical trading system is that it forces the trader to take the trades that they wouldn’t normally take just by looking at a chart.
Unwilling to accept a losing trade and cut a losing position short. Losing trades are an inevitable part of trading, many successful systems will produce more than 50% losing trades. The key is to never marry a position - if it hits your stop loss then exit it. Preserve your capital for the next trade.
Taking a profit too early to prevent a winning position become a losing one.
Money Management - The Holy Grail Of Trading
September 16, 2008
Money management determines how much to risk on each individual trade. This is a vital element of any trading system - risk too much and the chances of going bust are too high, risk too little and the reward for trading is too low.
The main methods for calculating trade size are:
Fixed Fractional
The number of contracts to trade is determined by a fixed percentage of current equity. As only whole futures contracts can be trade this, effectively, means that the trader uses 1 contract per $x of equity. For example 1 contract per $10,000.
Fixed fractional, however, requires unequal achievement at different contract levels. For 1 contract every $10,000 to move from 1 contract to 2 requires a profit of $10,000 from 1 contract. To move from 10 contracts to 11 still requires $10,000 profit but from 10 contracts. So for smaller account sizes it will take a long time for the money management to actually kick in and for larger account sizes the number of contracts traded will jump wildly around.
Using fixed fractional the number of contracts traded would be calculated as equity/x, where x=dollars per contract ($10,000 in the above example).
