My Signature Forex

Reasons to Choose Forex over Stocks

2008-12-02T08:38:00.000-08:00

Reasons to Choose Forex over Stocks

No Middlemen

Centralized exchanges provide many advantages to the trader. However, one of the problems with any centralized exchange is the involvement of middlemen. Any party located in between the trader and the buyer or seller of the security or instrument traded will cost them money. The cost can be either in time or in fees. Spot currency trading does away with the middlemen and allows clients to interact directly with the market-maker responsible for the pricing on a particular currency pair.

Forex traders get quicker access and cheaper costs. Buy/Sell programs do not control the market How many times have you heard that "fund A" was selling "X" or buying "Z" ? Rumor had it that the funds were taking profits because of the end of the financial year or because today is "triple witching day", all as an explanation of why this stock is up or the market in general is down or positive on the session.

The stock market is very susceptible to large fund buying and selling. In spot trading, the liquidity of the Forex market makes the likelihood of any one fund or bank to control a particular currency very slim. Banks, hedge funds, governments, retail currency conversion houses and large net-worth individuals are just some of the participants in the spot currency markets where the liquidity is unprecedented.

Analysts and brokerage firms are less likely to influence the market Have you watched TV lately ? Heard about a certain Internet stock and an analyst of a prestigious brokerage firm accused of keeping its recommendations, such as "buy" when the stock was rapidly declining? It is the nature of these relationships.

No matter what the government does to step in and discourage this type of activity, we have not heard the last of it. IPO's are big business for both the companies going public and the brokerage houses. Relationships are mutually beneficial and analysts work for the brokerage houses that need the companies as clients. That catch-22 will never disappear.

Foreign exchange, as the prime market, generates billions in revenue for the world's banks and is a necessity of the global markets. Analysts in foreign exchange don't drive the deal flow, they just analyze the forex market. 8,000 stocks versus 4 major currency pairs. There are approximately 4,500 stocks listed on the New York Stock exchange. Another 3,500 are listed on the NASDAQ.

Which one will you trade ?

Got the time to stay on top of so many companies ? In spot currency trading, there are dozens of currencies traded, but the majority of the market trades the 4 major pairs. Are'nt four pairs much easier to keep an eye on than thousands of stocks ?

I'd say so. Thats why you should dive in now and get your copy of the forex killer software. It will help you to open up this great money machine called Forex for you !

Good Luck !
To Your Trading Success

Wingcent Ning
Success-Biz Marketing
wingcent@gmail.com
http://mysignatureforex.blogspot.com
Singapore

Order Types in Forex

2008-12-02T08:33:00.000-08:00

Order Types in Forex

There are some basic order types that all brokers provide and some others that sound weird. The basic ones are :

Market Order

A market order is an order to buy or sell at the current market price. For example, EUR/USD is currently trading at 1.2140. If you wanted to buy at this exact price, you would click buy and your trading platform would instantly execute a buy order at that exact price. If you ever shop on Amazon.com, it's ( kinda ) like using their 1-Click ordering. You like the current price, you click once and it's yours ! The only difference is you are buying or selling one currency against another currency instead of buying Britney Spears CDs.

Limit Order

A limit order is an order placed to buy or sell at a certain price. The order essentially contains two variables, price and duration. For example, EUR/USD is currently trading at 1.2050. You want to go long if the price reaches 1.2070. You can either sit in front of your monitor and wait for it to hit 1.2070 ( at which point you would click a buy market order ), or you can set a buy limit order at 1.2070 ( then you could walk away from your computer to attend your ballroom dancing class ).

If the price goes up to 1.2070, your trading platform will automatically execute a buy order at that exact price. You specify the price at which you wish to buy/sell a certain currency pair and also specify how long you want the order to remain active ( GTC or GFD ).

Stop-Loss Order

A stop-loss order is a limit order linked to an open trade for the purpose of preventing additional losses if price goes against you. A stop-loss order remains in effect until the position is liquidated or you cancel the stop-loss order. For example, you went long ( buy ) EUR/USD at 1.2230.

To limit your maximum loss, you set a stop-loss order at 1.2200. This means if you were dead wrong and EUR/USD drops to 1.2200 instead of moving up, your trading platform would automatically execute a sell order at 1.2200 and close out your position for a 30 pip loss ( eww ! ).

Stop-losses are extremely useful if you don't want to sit in front of your monitor all day worried that you will lose all your money. You can simply set a stop-loss order on any open positions so you won't miss your basket weaving class.

When using the Forex Killer Software, we will always place stop loss orders ... To close a potentially loosing position early, while we let the profits ride. Download Forex Killer Software from here now.

Good Luck !
To Your Trading Success

Wingcent Ning
Success-Biz Marketing
wingcent@gmail.com
http://mysignatureforex.blogspot.com
Singapore

Trading in Foreign Exchange Market

2008-12-02T08:09:00.000-08:00

Trading in Foreign Exchange Market

In the FX market, you buy or sell currencies. Placing a trade in the foreign exchange market is simple : the mechanics of a trade are very similar to those found in other markets ( like the stock market ), so if you have any experience in trading, you should be able to pick it up pretty quickly.

The object of Forex trading is to exchange one currency for another in the expectation that the price will change, so that the currency you bought will increase in value compared to the one you sold. An exchange rate is simply the ratio of one currency valued against another currency.

For example, the USD/CHF exchange rate indicates how many U.S. dollars can purchase one Swiss franc, or how many Swiss francs you need to buy one U.S. dollar. How to Read an FX Quote Currencies are always quoted in pairs, such as GBP/USD or USD/JPY. The reason they are quoted in pairs is because in every foreign exchange transaction you are simultaneously buying one currency and selling another.

Here is an example of a foreign exchange rate for the British pound versus the U.S. dollar : GBP/USD = 1.7500 The first listed currency to the left of the slash ( "/" ) is known as the base currency ( in this example, the British pound ), while the second one on the right is called the counter or quote currency ( in this example, the U.S. dollar ). When buying, the exchange rate tells you how much you have to pay in units of the quote currency to buy one unit of the base currency. In the example above, you have to pay 1.7500 U.S. dollar to buy 1 British pound.

When selling, the exchange rate tells you how many units of the quote currency you get for selling one unit of the base currency. In the example above, you will receive 1.7500 U.S. dollars when you sell 1 British pound. The base currency is the basis for the buy or the sell. If you buy EUR/USD this simply means that you are buying the base currency and simultaneously selling the quote currency. You would buy the pair if you believe the base currency will appreciate ( go up ) relative to the quote currency. You would sell the pair if you think the base currency will depreciate ( go down ) relative to the quote currency.

Sounds complicated ? It really is easier than you think. When you decide to go for the forex-killer software you will get an exact step by step instruction pdf manual.

The software tells you what to buy and when to buy it. Basically you would not even need any information at all but its always good if you actually know what you are doing Download the software here and start making money today.

Let`s move on ...

Long/Short First, you should determine whether you want to buy or sell. If you want to buy ( which actually means buy the base currency and sell the quote currency ), you want the base currency to rise in value and then you would sell it back at a higher price. In trader's talk, this is called "going long" or taking a "long position".

Just remember : long = buy. If you want to sell ( which actually means sell the base currency and buy the quote currency) , you want the base currency to fall in value and then you would buy it back at a lower price. This is called "going short" or taking a "short position". Short = sell.

Bid/Ask Spread All Forex quotes include a two-way price, the bid and ask. The bid is always lower than the ask price. The bid is the price in which the dealer is willing to buy the base currency in exchange for the quote currency. This means the bid is the price at which you ( as the trader ) will sell. The ask is the price at which the dealer will sell the base currency in exchange for the quote currency. This means the ask is the price at which you will buy. The difference between the bid and the ask price is popularly known as the spread.

Let's take a look at an example of a price quote taken from a trading platform : Forex Spread On this GBP/USD quote, the bid price is 1.7445 and the ask price is 1.7449. Look at how this broker makes it so easy for you to trade away your money. If you want to sell GBP, you click "Sell" and you will sell pounds at 1.7445. If you want to buy GBP, you click "Buy" and you will buy pounds at 1.7449.

In the following examples, we're going to use fundamental analysis to help us decide whether to buy or sell a specific currency pair. If you always fell asleep during your economics class or just flat out skipped economics class, don t worry !

We will cover fundamental analysis next. For right now, try to pretend you know what s going on EUR/USD In this example Euro is the base currency and thus the basis for the buy/sell. If you believe that the US economy will continue to weaken, which is bad for the US dollar, you would execute a BUY EUR/USD order. By doing so you have bought euros in the expectation that they will rise versus the US dollar.

If you believe that the US economy is strong and the euro will weaken against the US dollar you would execute a SELL EUR/USD order. By doing so you have sold Euros in the expectation that they will fall versus the US dollar. USD/JPY In this example the US dollar is the base currency and thus the basis for the buy/sell. If you think that the Japanese government is going to weaken the Yen in order to help its export industry, you would execute a BUY USD/JPY order.

By doing so you have bought U.S dollars in the expectation that they will rise versus the Japanese yen. If you believe that Japanese investors are pulling money out of U.S. financial markets and converting all their U.S. dollars back to Yen, and this will hurt the US dollar, you would execute a SELL USD/JPY order. By doing so you have sold U.S dollars in the expectation that they will depreciate against the Japanese yen.

Good Luck !
To Your Trading Success

Wingcent Ning
Success-Biz Marketing
wingcent@gmail.com
http://mysignatureforex.blogspot.com
Singapore

The Advantages of Forex Over Other Finanical Instrument

2008-12-02T07:47:00.000-08:00

The Advantages of Forex Over Other Finanical Instrument

Why Trade Foreign Currencies ?

There are many benefits and advantages to trading Forex. Here are just a few reasons why so many people are choosing this market :

No commissions
No clearing fees
No exchange fees
No government fees
No brokerage fees

Brokers are compensated for their services through something called the bid-ask spread.

No Middlemen

Spot currency trading eliminates the middlemen, and allows you to trade directly with the market responsible for the pricing on a particular currency pair.

No Fixed Lot Size

In the futures markets, lot or contract sizes are determined by the exchanges. A standard-size contract for silver futures is 5000 ounces. In spot Forex, you determine your own lot size. This allows traders to participate with accounts as small as $250.

Low Transaction Costs

The retail transaction cost ( the bid/ask spread ) is typically less than 0.1 percent under normal market conditions. At larger dealers, the spread could be as low as .07 percent. Of course this depends on your leverage and all will be explained later.

No Waiting for Opening Bell

A 24-hour market. There is no waiting for the opening bell - from Sunday evening to Friday afternoon EST, the Forex market never sleeps.

This is awesome for those who want to trade on a part-time basis, because you can choose when you want to trade - morning, noon or night. No one can corner the market. The foreign exchange market is so huge and has so many participants that no single entity ( not even a central bank ) can control the market price for an extended period of time.

Leverage

In Forex trading, a small margin deposit can control a much larger total contract value. Leverage gives the trader the ability to make nice profits, and at the same time keep risk capital to a minimum. For example, Forex brokers offer 200 to 1 leverage, which means that a $50 dollar margin deposit would enable a trader to buy or sell $10,000 worth of currencies.

Similarly, with $500 dollars, one could trade with $100,000 dollars and so on. But leverage is a double-edged sword. Without proper risk management, this high degree of leverage can lead to large losses as well as gains.

High Liquidity

Because the Forex Market is so enormous, it is also extremely liquid. This means that under normal market conditions, with a click of a mouse you can instantaneously buy and sell at will. You are never "stuck" in a trade. You can even set your online trading platform to automatically close your position at your desired profit level ( a limit order ), and/or close a trade if a trade is going against you ( a stop loss order ).

Free Demo Accounts, News, Charts, and Analysis

Most online Forex brokers offer 'demo' accounts to practice trading, along with breaking Forex news and charting services. All free! These are very valuable resources for poor and SMART traders who would like to hone their trading skills with 'play' money before opening a live trading account and risking real money.

Mini and Micro Trading

You would think that getting started as a currency trader would cost a ton of money. The fact is, compared to trading stocks, options or futures, it doesn't. Online Forex brokers offer "mini" and micro trading accounts, some with a minimum account deposit of $300 or less. Now we're not saying you should open an account with the bare minimum but it does makes Forex much more accessible to the average ( poorer ) individual who doesn't have a lot of start-up trading capital.

With the Forex Killer Software at your fingertips you can start trading with 1000 usd or even less. Just keep in mind that more capital will minimize the risk of loosing + give you greater profits.

Best wishes my friend and make it a wonderful day !

Good Luck !
To Your Trading Success

Wingcent Ning
Success-Biz Marketing
wingcent@gmail.com
http://mysignatureforex.blogspot.com
Singapore

What is Technical Analysis ?

2008-11-26T12:25:00.000-08:00

What is Technical Analysis ?

Technical analysis attempts to forecast future price movements by examining past market data. Most traders use technical analysis to get a "big picture" on an investment's price history. Even fundamental traders will glance at a chart to see if they're buying at a fair price, selling at a cyclical top or entering a choppy, sideways market.

Technical analysts make a few key assumptions :

All market fundamentals are reflected in price data. Moods, differing opinions, and other market fundamentals need not be studied.

History repeats itself in regular, fairly predictable patterns. These patterns, generated by price movements, are called signals. A technical analyst's goal is to uncover a current market's signals by examining past market signals.

Prices move in trends. Technical analysts believe price fluctuations are not random and unpredictable. Once an up, down or sideways trend has been established, it usually will continue for a period.

Get In and Get Out - at the Right Time

Traders rely on price charts, volume charts and other mathematical representations of market data ( called studies ) to find the ideal entry and exit points for a trade. Some studies help identify a trend, while others help determine the strength and sustainability of that trend over time.

Technical analysis can add discipline and minimize emotion in your trading plan. It can be hard to screen out fundamental impressions and stick with your entry and exit points as planned. While no system is perfect, technical analysis helps you see your trading plan through more objectively and dispassionately.

Price Chart Types

Bar Charts
The most common type of chart showing price action. Each bar represents a period of time - a "period" as short as 1 minute or as long as several years. Over time, bar charts show distinct price patterns.

Candlestick Charts
Instead of a simple bar, each candlestick shows the high, low, opening and closing price for that period of time it represents. Candlestick patterns provide greater visual detail as they develop.

Point & Figure Charts
Point & figure patterns resemble bar chart patterns, except Xs and Os are used to mark changes in price direction. Point & figure charts make no use of time scale to associate a certain day with a certain price action.

Technical Indicator Types

Trend
Trend indicators smooth price data out, so that a persistent up, down or sideways trend can be easily seen. ( Examples : moving averages, trend lines )

Strength
Strength indicators describe the intensity of market opinion on a certain price by examining the market positions taken by various market participants. Volume or open interest are the basic ingredients of strength indicators.

Volatility
"Volatility" refers to the magnitude of day-to-day price fluctuations, whatever their directional trend. Changes in volatility tend to anticipate changes in prices. ( Example : Bollinger Bands )

Cycle
Cycle indicators indicate repeating market patterns from recurrent events such as seasons or elections. Cycle indicators determine the timing of a particular market pattern. ( Example : Elliott Wave )

Support/Resistance
Support and resistance describes the price levels where markets repeatedly rise or fall and then reverse. This phenomenon is attributed to basic supply and demand. ( Example : Trend Lines )

Momentum
Momentum indicators determine the strength or weakness of a trend as it progresses over time. Momentum is highest when a trend starts and lowest when the trend changes.

When price and momentum diverge, it suggests weakness. If price extremes occur with weak momentum, it signals an end of movement in that direction. If momentum is trending strongly and prices are flat, it signals a potential change in price direction. ( Example : Stochastic, MACD, RSI )

Using Technical Indicators

Price charts help traders identify trade-able market trends - while technical indicators help them judge a trend's strength and sustainability.

If an indicator suggests a reversal, confirm the shift before you act. That might mean waiting for another period to confirm the same indicator's signal, or checking out another indicator. Patience will help you read the signals accurately and respond accordingly.

Types of Moving Averages

One of the most widely used indicators, moving averages help traders verify existing trends, identify emerging trends, and view overextended trends about to reverse. As the name suggests, these are lines overlaid on a chart that "average out" short-term price fluctuations, so you can see the long-term price trend.

A simple moving average weighs each price point over the specified period equally. The trader defines whether the high, low, or close is used, and these price points are added together and averaged, forming a line.

A weighted moving average gives more emphasis to the latest data. It smoothes out a price curve, while making the average more responsive to recent price changes.

An exponential moving average weighs more recent price data in a different way. An exponential moving average multiplies a percentage of the most recent price by the previous period's average price.

Finding the best moving averages and period for your pair

It can take a while to find the best combination of moving average and period length for your currency pair. The right combo will make the trend you're looking for clearly visible, as it develops. Finding that optimal fit is called curve fitting.

Usually traders start by comparing a few timeframes for their moving averages over a historical chart. Then you can compare how well and how early each timeframe signaled changes in the price data as they developed, then adjust accordingly.

When you've found a moving average that works well for your currency pair, you can consider this as a line of support for long positions or resistance for short positions. If prices cross this line, that often signals a currency is reversing course. Here's an example:

Longer-term moving averages define a trend, but shorter-term MAs can signal its shift faster. That's why many traders watch moving averages with different timeframes at once. If a short-term MA crosses your longer-term MA, it can signal your trend is ending - and time to pare back your position.

Stochastics

Stochastic studies, or oscillators, help monitor a trend's sustainability and signal reversals in prices. Stochastics come in two types, %K and %D, measured on a scale from 0 to 100. %K is the "fast", more sensitive indicator, while %D is "slow" and takes more time to turn.

Stochastic studies aren't useful in choppy, sideways markets. In these conditions %K and %D lines might cross too frequently to signal anything.

Relative Strength Index ( RSI )

Like stochastics, RSI measures momentum of price movements on a scale of 0 to 100.

Always confirm RSI signals with other indicators. RSI can remain at lofty or sunken levels for a long time, without prices reversing course. All that means is that a market is quite strong or weak - and likely to stay so for a while.

Adjust your RSI to the right timeframe for you. A short-term RSI will be very sensitive and give out many signals, not all of them sustainable; a longer-term RSI will be less choppy. Try to match your RSI timeframe to your own trading style: short-term for day traders, longer-term for position traders.

Divergences between prices and RSI may suggest a trend reversal. Of course, make sure you confirm your signals before acting.

Bollinger Bands

Bollinger Bands are volatility curves used to identify extreme highs or lows in price. Bollinger Bands establish "bands" around a currency's moving average, using a set number of standard deviations around the moving average. Creator Jon Bollinger recommends the following:

Touching a high or low band doesn't necessarily mean an immediate trend reversal. Bollinger Bands adjust dynamically as volatility changes, so touching the band just means prices are extremely volatile. Use Bollinger Bands with other indicators to determine the trend's strength.

MACD - Moving Average Convergence Divergence

Developed by Gerald Appel, MACD (pronounced "Mac-Dee") plots the difference between 26-day and 12-day exponential MAs.

A 9-day MA serves as a trigger line: when MACD crosses below the trigger, it's a bearish signal; when MACD crosses above the trigger, it's a bullish signal.

If MACD turns positive and makes higher lows while prices are still tanking, this could be a strong buy signal. Conversely, if MACD makes lower highs while prices are making new highs, this could be a strong bearish divergence and a sell signal.

Fibonacci Retracements

Fibonacci retracement levels are a sequence of numbers discovered by the noted mathematician Leonardo da Pisa in the 12th century. These numbers describe cycles found throughout nature; technical analysts use them to find pullbacks in the currency market.

After a significant price move, up or down, prices often "retrace" most or all of the original move. As prices retrace, support and resistance levels often occur at or near the Fibonacci Retracement levels. For currencies, that means retracements usually happen at 23.6%, 38.2%, 50% or 61.8% of the previous move.

Good Luck !
To Your Trading Success

Wingcent Ning
Success-Biz Marketing
wingcent@gmail.com
http://mysignatureforex.blogspot.com
Singapore

Introduction to Fundamental Analysis

2008-11-26T12:20:00.000-08:00

Introduction to Fundamental Analysis

Fundamental analysis studies the core underlying elements that influence the economy of a particular entity, like a stock or currency. It attempts to predict price action and trends by analyzing economic indicators, government policy, societal and other factors within a business cycle framework.

If you think of the markets as a big clock, fundamentals are the gears and springs that move the hands around the face. Anyone can tell you what time it is now, but the fundamentalist knows about the inner workings that move the clock's hands towards times ( or prices ) in the future.

Are you a Technician or Fundamentalist ?

There's a tendency to pigeonhole traders into two distinct schools : fundamental or technical. In fact, most smart traders favor a blended approach versus being a purist of either type.
Fundamentalists need to keep an eye on signals derived from price charts, while few technicians can afford to completely ignore impending economic data, critical political decisions or pressing societal issues that influence price action.

Forecasting Economic conditions using Models

Fundamental analysis is very effective at forecasting economic conditions, but not necessarily exact market prices. Studying GDP forecasts or employment reports can give you a fairly clear picture of an economy's health and the forces at work behind it. But you still need a method to translate that into specific trade entry and exit points.

The bridge between fundamental data and a specific trading strategy usually comes from a trader model. These models use current and historical empirical data to estimate future prices and translate those into specific trades.

Beware of "Analysis Paralysis"

Forecasting models are both art and science, with so many different approaches that traders can get overloaded. It can be tough to decide when you know enough to pull the trigger on a trade with confidence.

Many traders switch to technical analysis at this point to test their hunches and see when price patterns suggest an entry.

Look for Fundamental Drivers first

The fundamentals include everything that makes a country and its currency tick. From interest rates and central bank policy to natural disasters, the fundamentals are a dynamic mix of distinct plans, erratic behaviors and unforeseen events.

That said, not every development will move a country's currency. Try to start by identifying the most influential contributors to this mix versus following every fundamental out there.

Good Luck !
To Your Trading Success

Wingcent Ning
Success-Biz Marketing
wingcent@gmail.com
http://mysignatureforex.blogspot.com
Singapore

Forex Market Drivers

2008-11-26T12:11:00.000-08:00

Forex Market Drivers

Rising interest rates strength that country's currency

A common way to think about interest rates is how much it's going to cost to borrow money, whether for our mortgages or how much we'll earn on our bond and money market investments. Interest rate policy is a key driver of currency prices and typically a strategy for new currency traders.

Fundamentally, if a country raises its interest rates, its currency prices will strengthen because the higher interest rates attract more foreign investors.

For example, higher rates in the Eurozone may prompt U.S. investors to sell U.S. dollars and buy bonds in Euros. Similarly, if interest rates increase in Switzerland, those investors may decide to sell their Euro-bonds and move into bonds in Swiss francs ( CHF ), driving Euros down and Swiss francs up.

When gold goes up, the USD goes down ( and vice versa )

Historically, gold is a "safe haven", a country-neutral investment and an alternative to the world's other reserve currency, the U.S. dollar. That means gold prices have an inverse relationship to the USD, offering several ways for currency traders to take advantage of that relationship.

For example, if gold breaks an important price level, you'd expect gold to move higher. With this in mind, you might sell dollars and buy Euros, for example, as a proxy for higher gold prices.

Rising gold prices help major gold producers

Australia is the world's third largest exporter of gold, and Canada is the third largest producer worldwide. These two major currencies tend to strengthen as gold prices rise. You might consider going long these currencies when gold is increasing in value, or trade your GBP or JPY for these currencies when gold is on the rise.

Oil-dependent countries weaken as oil prices rise

Just as airlines and other oil-dependent industries are hurt by rising oil prices, so are the currencies of oil-dependent countries like the U.S. or Japan, both of which are massively dependent on foreign oil.

If you believe oil prices will continue to rise, you can consider buying commodity-based economies like Australia or Canada or selling oil-dependent currencies.

Good Luck !
To Your Trading Success

Wingcent Ning
Success-Biz Marketing
wingcent@gmail.com
http://mysignatureforex.blogspot.com
Singapore

What are Economic Indicators ?

2008-11-26T11:54:00.000-08:00

What are Economic Indicators ?

Economic indicators are snippets of financial and economic data published regularly by governmental agencies and the private sector. These statistics help market observers monitor the economy's pulse - so it's no surprise that they're religiously followed by almost everyone in the financial markets.

With so many people poised to react to the same information, economic indicators have tremendous potential to generate volume and to move prices. It might seem like you need an advanced economics degree to parse all this data accurately - but in fact traders need only keep a few simple guidelines in mind to making trading decisions based on this data.

Mark your economic calendars

Know exactly when each economic indicator will be released. You can find these calendars at the New York Federal Reserve Bank's site ; FOREX.com clients can simply login to MyAccount and click on Economic Calendars.

Watching the economic calendar not only helps you consider trades around these events, it helps explain otherwise unanticipated price actions during those periods. Consider this scenario :

Monday morning and the USD has been in a tailspin for 3 weeks, with many traders short USD positions as a result.

On Friday, however, U.S. employment data is scheduled to be released. If that report looks promising, traders may start unwinding their short positions before Friday, leading to a short-term rally in USD through the week.

What does this data mean for the economy ?

You need not understand every nuance of each data release, but you should try to grasp key, large-scale relationships between reports and what they measure in the economy. For example, you should know which indicators measure the economy's growth ( gross domestic product, or GDP ) versus those that measure inflation ( PPI, CPI ) or employment strength ( non-farm payrolls ).

Not all economic indicators can move markets

The market often pays more attention to certain indicators under certain conditions - and that focus can change over time.

For example, if prices ( inflation ) are not a crucial issue for a given country, but its economic growth is problematic, traders may pay less attention to inflation data and focus on employment data or GDP reports.

Watch for the unexpected

Often the data itself may not be as important as whether or not it falls within market expectations. If a given report differs widely and unexpectedly from what economists and market pundits were anticipating, market volatility and potential trading opportunities may result.

At the same time, be careful of pulling the trigger too quickly when an indicator falls outside expectations. Each new economic indicator release contains revisions to previously released data. Here's an example :

Don't get caught up in details

While your macroeconomics professor may appreciate all the nuances of an economic report, traders need to filter data judiciously for their own purposes: making intelligent trading decisions.

For example, many new traders watch the headlineNew line of the employment report, for example, assuming that new jobs are key to economic growth. That may be true generally, but in trading terms non-farm payrolls is the figure traders watch most closely and therefore has the biggest impact on markets.

Similarly, PPI measures changes in producer prices generally - but traders tend to watch PPI excluding food and energy as a market driver. Food and energy data tend to be much too volatilve and subject to revisions to provide an accurate reading on producer price changes.

There are two sides to every trade

Hopefully this has helped you realize the importance of watching economic indicators - and knowing which data are most likely to move markets and impact currency traders.

Just remember that no trader's knowledge can be complete all the time. You might have a great handle on economic data published in the U.S. - but there are times when data published in Europe or Australia might have surprising impact on your currency market. Doing your homework before trading any currency will help you stay on guard.

Economic indicators : a currency's vital signs

Traders can measure the economic health of a given country ( and its currency ) through its economic indicators - but, just like a doctor monitoring a patient's vital signs, not all stats count equally. Here's a primer of the key economic indicators that often impact currency traders.

Economic indicators divide into leading and lagging indicators :

Leading indicators are economic factors that change BEFORE the economy starts to follow a particular trend. They're used to predict changes in the economy.

Lagging indicators are economic factors that change AFTER the economy has already begun to follow a particular trend. They're used to confirm changes in the economy.

Major economic indicators

Gross Domestic Product ( GDP )

The sum of all goods and services produced either by domestic or foreign companies. GDP indicates the pace at which a country's economy is growing ( or shrinking ) and is considered the broadest indicator of economic output and growth.

Industrial Production

A chain-weighted measure of the change in the production of the nation's factories, mines and utilities, industrial production also measures the country's industrial capacity and how fully it's being used ( capacity utilization ).

The manufacturing sector accounts for one-quarter of the major currencies' economies, so it's critical to watch the health of factories and whether their capacity is being maximized. Purchasing Managers Index ( PMI )

The National Association of Purchasing Managers ( NAPM )
( now called the Institute for Supply )

Management, releases a monthly composite index of national manufacturing conditions. The index includes data on new orders, production, supplier delivery times, backlogs, inventories, prices, employment, export and import orders. It is divided into manufacturing and non-manufacturing sub-indices.

Producer Price Index ( PPI )

Measures average changes in selling prices received by domestic producers in the manufacturing, mining, agriculture, and electric utility industries.

The PPIs most often used for economic analysis are those for finished goods, intermediate goods, and crude goods.

Consumer Price Index ( CPI )

Measures the average price level paid by urban consumers ( 80% of the population in major currency countries ) for a fixed basket of goods and services. It reports price changes in over 200 categories.

The CPI also includes various user fees and taxes directly associated with the prices of specific goods and services.

Durable Goods

Durable Goods Orders measures new orders placed with domestic manufacturers for immediate and future delivery of factory hard goods. A durable good is a product that lasts over three years, during which its services are extended.

Companies and consumers sometimes put off purchases of durable goods during tough economic times - so this figure is a useful measure of certain kinds of customer demand.

Employment Cost Index ( ECI )

Payroll employment is a measure of the number of jobs at larger companies in more than 500 industries in all 50 U.S. states and 255 metropolitan areas. ECI counts the number of paid employees working part-time or full-time in the nation's business and government establishments.

Retail Sales

Measures total receipts of retail stores from samples representing all sizes and kinds of business in retail trade throughout the nation. It is the timeliest indicator of broad consumer spending patterns and is adjusted for normal seasonal variation, holidays, and trading-day differences.

Retail sales include durable and nondurable merchandise sold, and services and excise taxes incidental to the sale of merchandise. It doesn't include sales taxes collected directly from the customer.

Housing Starts

Measures the number of residential units on which construction is begun each month. A "start" refers to excavation of the foundation of a residential home.

Housing is usually one of the first sectors to react to interest rate changes. Significant reaction of start/permits to changing interest rates signals interest rates are nearing trough or peak. To analyze, focus on the percentage change in levels from the previous month. Report is released around the middle of the following month.

Good Luck !
To Your Trading Success

Wingcent Ning
Success-Biz Marketing
wingcent@gmail.com
http://mysignatureforex.blogspot.com
Singapore

8 Trading Tips to Your Success

2008-11-18T05:59:00.000-08:00

8 Trading Tips to Your Success

You can never have too many tips when you are trading !
Read on ...

Tip A. )
Trading strategies that work well in an up-market may not work in a down-market. Same as : systems that work well in a good trending market may not be applicable at all to a ranging market. The solution is either to have a system for each type of the market or make sure that one solid system will work well under all market conditions — extensive testing is the way to know the truth.

Tip B. )
Do not try to pick tops and bottoms of the price. It is a very wrong approach that unfortunately many traders have adopted. Searching for bargains is a good thing when you go shopping, but will put you in troubles if applied to Forex trading. Simply spot the trend and join it like other traders who are serious about trading do.

Tip C. )
Always remind yourself that the first and the last market bars/ticks are the most expensive. Delay entering the market on the first ticks and be out of the market early. On the open, never trade in the direction of a gap.

Tip D. )
Never worry about missing out on a trading opportunity. Do not provoke yourself to take a trade that does not meet all entry rules. Just because it seems to be too good to pass up is not an excuse for trading. You are never going to run out of trades, so be firm and stick to your rules.

Tip E. )
By using knowledge about currency correlation traders can easily avoid opening positions that cancel each other ( e.g. +10 pips on one pair and -10 on another = 0 ). Find out which currency pairs move simultaneously and which — in opposite direction. Currency correlation information.

Tip F. )
Did we say : "Have your stop loss order in place" ? Yes we did. Anyway, we will repeat it one more time. Even if your trading system needs no stops, still have it. Not that you are going to use it, but just for the safety of your capital. A sudden huge move in the market may cost you a big portion of your trading account especially if margin call is triggered.

We use insurance for many things in our life, why don't have one for your trading account ? For trading systems without a stop loss orders — put one on a decent distance, for example 100+ pips. Also do not use too tight stop orders as they will most likely be hit more often then you need to.

Tip G. )
Spend less time trading Forex but make it quality time. Trade only when you can be 100% focused. Time spent in front of the monitor does not assume profitability, so don't fool yourself and do not trade half-ready.

Tip H. )
And finally, it is wrong to trade with the money that you cannot allow to lose. That is also why traders switching from Demo to real account often may find themselves losing a trade after trade with a system that used to be profitable. This is because with a real account they've got fear to lose money, while on Demo account their minds were free.

Do not trade if you cannot afford to lose your money. Moreover, do not trade if you must make X amount of money per month to pay your bills in order to avoid financial trouble. Trading scared is the best way to mess up all trading rules, discipline and get additional stress.

Trading smart is what we wish you to achieve, and believe us, being focused and serious about the job you do will make you successful !

Good Luck !
To Your Trading Success

Wingcent Ning
Success-Biz Marketing
wingcent@gmail.com
http://mysignatureforex.blogspot.com
Singapore

What is Fundamental Analysis ?

2008-11-18T05:46:00.000-08:00

What is Fundamental Analysis ?

Fundamental Analysis in Forex is a type of market analysis which involves studying of the economic situation of countries to trade currencies more effectively.

It gives information on how the big political and economical events influence currency market. Figures and statements given in speeches by important politicians and economists are known among the traders as economical announcements that have great impact on currency market moves. In particular, announcements related to United States economy and politics are the primary to keep an eye on.

What is economic calendar ?

Economic calendar is created by economists where they predict different economics figures and values according to previous months. It contains next data : Date — Time — Currency — Data Released — Actual — Forecast — Previous

For example : If the forecast is better than the previous figure, then US dollar usually is going to strengthen against other currencies. But when news are due, traders have to check the actual data.

If to look at oil prices, a rising price will result in weakening of currencies for countries which depend on huge oil import, e.g. America, Japan. A good example of detailed economic calendar can be found here : Forex Economic Calendar

Whose speeches to keep an eye on ?

Chairman of the Federal Reserve Bank of USA, Secretary of the Treasury, President of the Federal Reserve Bank of San Francisco and so on. Speeches of those prominent people are watched closely by traders.

What are the most powerful figures that move Forex market ?

Interest Rate

Traditionally, if a country raises its interest rates, its currency will strengthen because investors will shift their assets to that country to gain higher returns.

Employment Situation

Decreases in the payroll employment are considered as signs of a weak economic activity that could eventually lead to lower interest rates, which has negative impact on the currency.

Trade balance, budget and treasury budget

A country that has a significant Trade Balance deficit will generally have a weak currency as there will be continuous commercial sellings of its currency.

Gross Domestic Product ( GDP )

GDP is reported quarterly and is followed very closely as it is a primary indicator of the strength of economic activity. A high GDP figure is usually followed by expectations of higher interest rates, which is mostly positive for the currency.

Less powefull economic indicators are :

Retail sales

It is the first real indicator of the strength of consumer expenditure.

Durable goods

Rising Durable Goods Orders are normally associated with stronger economic activity and can therefore lead to higher short-term interest rates, which is usually supportive for a currency.

How do traders use all this ?

There are few useful tips that can be followed :

1. ) Keep an economic calendar on hand. Watch for the events when data are due to be released.

2. ) Know what indicator is gaining the most of attention at any given time as it becomes a catalyst for future price moves. For example, when the U.S. dollar is weak traders will watch closely the inflation indicator.

3. ) When the difference between the expectations and real results occur, watch for corrections in the market price moves.

4. ) Pay attention to news revisions if any, the situation on the market can change quickly.

Another important thing to consider — your Broker !

Because of the high volume of trades made at the time of important economic announcements some brokers may block new orders from being conducted.

For traders it means they should enter the trade before the "major action" begins and, what is more important, they must always have their protective stops placed. Being not able to access the trade desk to close your losing position in time is the most frustrating thing traders should always try to avoid.

Good Luck !
To Your Trading Success

Wingcent Ning
Success-Biz Marketing
wingcent@gmail.com
http://mysignatureforex.blogspot.com
Singapore

Forex Chart Trend Lines

2008-11-18T05:34:00.000-08:00

Forex Chart Trend Lines

Plotting a trend line on a Forex chart gives very valuable information. Not only the trend line will show a current trend ( direction ) of the price move, it will also depict points of support and resistance levels for market price.

In addition, it will also help to determine good entry and exit points, best positioning for profit taking and placing protective stops. This very simple, but yet quite powerful tool will be one of the crucial indicators of possible trend reversal ( when market price starts move in the opposite direction ).

So, shall we learn how to draw trend line to make it our good friend in profitable forex trading ?

In the uptrend market trend line is drawn below the pattern formation ; in the downtrend — above. ( That is why when the trend is going to change our trend line will be crossed, which therefore will give us a signal that the price can start moving in another direction. )

In the uptrend, Forex trend line is drawn through the lowest swing-points of the price move. Connecting at least two «lowest lows» will create a trend line.

In the down trend, trend line is drawn through the highest swing-points of the price move. Connecting at least two «highest highs» will create a trend line.

A trend line confirms its validity when the price respects this line. The more «lowest lows» / «highest highs» the trend line contains, the stronger it becomes.

Another sample of drawing trend lines : main and inner downtrend lines.

Good Luck !

To Your Trading Success

Wingcent Ning

Success-Biz Marketing

wingcent@gmail.com

http://mysignatureforex.blogspot.com

Singapore

Forex Market Hours

2008-11-18T05:27:00.000-08:00

Forex Market Hours

When to trade and when not to.

Forex market is open 24 hours a day. It provides a great opportunity for traders to trade any time of the day or at night. However, although it seems to be not very important at the beginning, the right time to trade is one of the most crucial points to be successful in trading at the forex market.

So, when should one consider trading and why ?

The best time to trade is when the market is the most active and therefore has the biggest volume of trades. More active currency moves will create a good chance to catch the trade and make some profit. A calm, slow market is literally wasting of time — turn off your computer and don't even bother !

Forex trading hours, trading time :

New York opens 8:00 am to 5:00 pm EST
Tokyo opens 7:00 pm to 4:00 am EST
Sydney opens 5:00 pm to 2:00 am EST
London opens 3:00 am to 12:00 noon EST

And so, there are hours when two sessions are overlapped :

New York and London — 8:00 am — 12:00 noon EST
Sydney / Tokyo — 7:00 pm — 2:00 am EST
London / Tokyo — 3:00 am — 4:00am EST

For example :

Trading EUR/USD, GBP/USD currency pairs would give good results between 8:00 am and 12:00 noon EST when two markets for those currencies are active.

At those overlapping trading hours you'll find the highest volume of trades and therefore more chances to win in the foreign currency exchange market.

Good Luck !
To Your Trading Success

Wingcent Ning
Success-Biz Marketing
wingcent@gmail.com
http://mysignatureforex.blogspot.com
Singapore

What Is Forex ?

2008-11-18T05:17:00.000-08:00

What Is Forex ?

The Term

The term “FOREX” stands for Foreign Exchange FOREX ( or FX as a short abbreviation ) is a global currency exchange market where foreign currencies from all over the world are bought and sold for profit.

Forex is the largest and most liquid market in the world

Forex is the largest and most liquid market in the world where trillions of dollars exchanges take place every day. That’s an enormous money flow. No stock market exchange in the world come close to these numbers.

Currencies in the Forex market are traded 24 hours a day 7 days a week. Market literally follows the sun around the world. Trading moves from major banking centers of the United States to Australia and New Zealand, then to the Far East, gets to Europe and finally returns back to the States.

Trading Forex is all about exchanging currencies

Trading on Foreign exchange market simply means buying of one currency and selling another at the same time. In other words, the currency of one country is exchanged for currency of another country at the current exchange rates.

Foreign currencies are always traded in pairs - EUR/USD, GBP/USD, EUR/JPY etc ... Around 70% of all transactions made with major currencies like U.S. dollar, Australian Dollar, British Pound, Swiss Franc and Japanese Yen.

Nowadays Forex is available to small investors

While in the past Forex market was not available to small investors ( individuals ) due to large minimum transaction sizes, today Forex brokers are able to break those large sizes into a smaller unit lots and thus offer small investors an opportunity to buy or sell currencies side by side with regular core Forex market investors such as large banks, central banks, multinational corporations, hedge funds and other financial institutions.

Being incompetent in Forex can be expensive

Forex market is huge and plunging into trading without knowing its rules, without knowing "what is Forex" will be equal to swimming in the pool with ocean sharks. The dominant Forex players such as banks and hedge funds have a power to influence market moves and currencies exchange rates. For inexperienced traders investing own money in such game is as risky and uncertain as gambling. It could turn into a million fortune only in a couple of weeks or become a disaster for those who was ignorant in learning.

Forex brokers offer very big leverage to individual investors. A trader can trade at huge leverage as much as 300 to 1, meaning that for every dollar trader puts in for trading he can trade $300.

For example, having an account equal to $1,000 trader can trade as much as $300,000.It is a huge opportunity, but it also is very dangerous. No experienced trader will ever trade with such big leverage unless he has a really strong argument for a particular trade, and even after that it is an enormous risk.

Is trading Forex profitable ?

Trading in the Forex market is profitable, but only for 5% out of all beginner traders who start trading Forex. New traders need to learn the basics of trading well, and practice a lot on demo accounts before going real.

Like in every business, when trading money in Forex, trader gets paid depending on his knowledge and trading experience.

Good Luck !
To Your Trading Success

Wingcent Ning
Success-Biz Marketing
wingcent@gmail.com
http://mysignatureforex.blogspot.com
Singapore

Facts about Scalping in Forex

2008-11-11T22:24:00.000-08:00

Facts about Scalping in Forex

The only way to make small account big in a short period of time is through the use of really high leverage. But wait ... do not jump of the cliff right away. Start with reasonable leverage for scalping, for example 20:1 or at most 50:1, then move on as you see scalping skills improve. But even before that do not be lazy to demo trade your scalping system – make sure it will not disappoint you later ...

The only way to trade with high leverage without risking blowing up an entire account in only 10-15 trades is by trading with a tight stop loss. Trading without stop loss will “kill” your investment in no time.

It is wise to decide on the size of the trading lot and exposed risk in advance. Do a simple math : calculate the worst possible situation, e.g. : 10 consecutive losses in a row ; then see if your account will survive and if there be something left to move on. And, although 10 losses in a row is a very unlikely scenario, you cannot deny it ...

Although Forex is active 24/7, not every hour is suitable for scalping.
No scalper wants to sit in front of the monitor for numerous hours bored and disappointed with the “sleeping” price as it literally moves nowhere. Scalpers hunt for volatile, liquid market. There are 4 major market sessions : London, New York, Sydney and Tokyo session. To trade effectively scalper needs to learn behavior of a chosen currency pair and define most active sessions, even particular hours for this pair to be able to catch good price moves.

Another thing to keep in mind is spread which brokers charge for different currencies. The higher the spread the harder it will be to collect desired pips ( because once trading position is opened, trader must cover spread cost – earn pips for broker first – and only then collect own pips ). And, of course, the lower the spread the easier/faster it is to accumulate pips.

Another factor to consider is an average daily range of the price for chosen currency. The wider it is the more realistic is an opportunity to profit from price moves. One of the scalpers’ favorite currency pair is EUR/USD with its low spread and good daily price range.

While using high leverage combined with high frequency trading, scalpers should be very cautious about the cost of actual trading, as each pip here makes a dramatic difference after a large number of trades.

This means being very careful with entries and exits, stops and limit orders, and also be very realistic about profit targets.

Once in the trade, scalpers should manage trading risks by :
1 ) moving stops to break-even as soon as situation permits ;
2 ) taking profits at a logical levels : at round market price numbers : 00, 10, 20, 50 etc ..., at previous support/resistance levels, at Fibonacci levels etc ...
3 ) getting out of the trade if the price freezes for longer time than expected.

Scalp-trading is very demanding and requires a lot of concentration, constant monitoring of the price and very quick decision making. Also, short time frames used in scalping strategies, require a good grasp of trading complemented with sound technical analysis skills. It is not a place where beginners feel very comfortable as it demands from traders a good chunk of experience.

Scalping involves substantial risks

A lot of beginners have common problem when trading highly leveraged accounts – they tend to maximize profits by trading with full capital at once. Do not do that ! Maximizing chances for higher profits goes hand in hand with maximizing risks ! The size of positions opened must be calculated very accurately so that your entire account will not be wiped out with just one( ! ) very unfortunate trade.

Another factor that increases risks for scalpers is the spread traders pay when open a trade. Each time a new trade is open, the spread cost is paid to the broker, thus opening 10 small trades instead of 1 long term trade increases the cost of trading in 10 times. If to measure risk/reward ratio of such scalping activity it may show very risky and potentially losing trading.

Example :

With GBP/USD currency pair a scalper sets profit target of 10 pips and stop loss of 10 pips. So far it is 1:1 risk/reward ratio. In the next step, when the spread is added, the picture changes.

For example, the spread his broker charges for GBP/USD is 4 pips. When scalper opens a position he is -4 pips ( the spread has been charged ). Now in order for him to reach the target of 10 pips profit, the price has to move +4 and +10 pips = 14 pips.

On the other hand, in order to trigger his stop loss the price should move ... -4 is already in place ... so, only -6 pips and he will be stopped at total of -10 pips ... the risk-reward ratio has changed in over 2:1, not very promising situation indeed ...

To understand the full challenge of scalping as a trading style, consider this : hard work and small gains accumulated over a decent period of time could easily be wiped out with one large loss. Finding a balance between profit levels and size of acceptable losses presents the most difficult challenge to scalper’s strategy.

Best of luck in achieving your goals !

Good Luck !
To Your Success

Wingcent Ning
Success-Biz Marketing
wingcent@gmail.com
http://mysignatureforex.blogspot.com
Singapore

How to Profit Trading Forex

2008-11-11T22:13:00.000-08:00

How to Profit Trading Forex

Basic yet important things every trader should know.

If you hear from anyone that making money in Forex is easy, do not believe it. It is a myth. The truth is – being profitable in Forex requires a lot of work, dedication, practice, more than a good discipline, sharp knowledge of money management and understanding of the psychology of the currency market. Not so little and therefore not so easy ...

Trading Forex was never about gambling

Trading is not a gambling by guessing where the price will move, although there are many traders ( mostly beginners ) that are exactly gambling ... Trading currencies on the Forex market requires logical and analytical calculations based either on fundamental or technical analysis of price moves.

Making money in Forex requires a set of rules

Making money starts with a plan to make money. Such plan is of enormous importance when it comes to trading foreign currencies. But, besides creating a plan, a trader needs constantly follow it. How often trader brake his rules will affect how much money he will make trading Forex.

Sounds simple : create and follow ... However, there is a real challenge when trader follows the rules but rules fail to make money ... it happens inevitably for every trading system known. If system had proven to be successful, sticking to the trading plan and firmly following the rules even when losing money will eventually yield profitable outcome. Having strong trading discipline and taking losses when necessary is a sign of serious trading approach.

Succeeding in Forex by using money management

To profit in Forex sticking to a set of rules is not enough. Good money management is also needed. Knowledge of how much to trade per each open position and where and when to stop – is what separates successful trader from bankrupt trader. Many beginner traders over-leverage themselves being attracted by big and promising leverages offered by Forex brokers. The truth is that a big leverage is not only about a big win, but also when it comes to be so – a big loss. Leverage higher than 1:20 will not attract serious investors.

Know your losses, before counting profits

Opening a new trading position must be first of all about how much money may be lost and then what would be the profits. Good money management implies that trader is expecting to win at least twice as much as he could lose on each trade. This way being right only 50% of the time will still make trading profitable. Using good money management in Forex trading is hundred times more important than having any great trading system itself.

Forex traders' mind

And last but not least is trader’s psychology. Going in profit or losing money always create psychological challenge for trader to act responsively. Not being greedy and also cutting losses short is the key to this game.

Trading Forex, you need to accept losses. They are inevitable and occur in any money involving operations. Therefore, instead of battling losses trader needs to accurately analyze unfavorable situations and take lessons from losing trades.

Every experienced trader would also suggest – there must be no attempts for revenge when losing money. Trying to return your money at any cost will put a trader in deeper troubles. Instead, the trader should return to trading rules and honestly analyze own mistakes, accept that the market was not in his favor and try to improve the trading plan for future success.

Successful traders are learners, what about you ?

And finally, even successful traders are constant learners. Up-to-date knowledge about Forex market opportunities is what also makes them continuously profitable in their trading career.

Happy learning and trading !

Good Luck !
To Your Success

Wingcent Ning
Success-Biz Marketing
wingcent@gmail.com
http://mysignatureforex.blogspot.com
Singapore

22 Forex Trading Tips

2008-11-11T21:33:00.000-08:00

22 Forex Trading Tips

Dear Traders, take a look on those important tips given to you.
Read on ...

Tip #1 : No Gamblers
Gamblers go to casino. All unproved, spontaneous actions in Forex trading — are a part of pure gambling. Any attempt to trade without analysis and studying the market is equal to a game. Game is fun except when you are losing real money ...

Tip #2 : Practice on Forex Demo Account
Never invest money into a real Forex account until you practice on a Forex Demo account ! Allow at least 2 month for demo trading. Consider this : 90% of beginners fail to succeed in the real money market only because of lack of knowledge, practice and discipline. Those remaining 10% of successful traders had been sharpening and shaping their skills on demo accounts for years before entering the real market. So, starts practicing on your Forex Demo account first.

Tip #3 : Go with the Trend
Go with the trend ! Trend is your friend. Trade with the trend to maximize your chances to succeed. Trading against the trend won't "kill" a trader, but will definitely require more attention, nerves and sharp skills to rich trading goals.

Tip #4 : Looking at Time Frame
Always take a look at the time frame bigger than the one you've chosen to trade in. It gives the bigger picture of market price movements and so helps to clearly define the trend. For example, when trading in 15 minute time frame, take a look at 1 hour chart ; trading hourly would require obtaining a picture of daily, weekly price movements.

If a trend is hard to spot — choose a bigger time frame. Up and down market patterns are always present. Always make sure you know the dominant trend, unless you are a scalper. Scalpers have no need to spend their time studying big trends, what's happening in the market here and now ( during 5-10 minute time frame ) should be of only importance to a Forex scalper.

Tip #5 : Never Risk
Never risk more than 2-3% of the total trading account. One important difference between a successful and an unsuccessful trader is that the first is able to survive under unfavorable conditions on the market, while an unsuccessful trader will blow up his account after 5-10 unprofitable trades in the row.

Even with the same trading system 2 traders can get opposite results in the long run. The difference will be again in money management approach. To introduce you to money management, let's get one fact : losing 50% of total account requires making 100% return from the rest of money just to restore the original balance.

Tip #6 : Trade Calm
Put emotions down. Trade calm. Don't try to revenge after losing the trade. Don't be greedy by adding lots of positions when winning. Overreaction blocks clear thinking and as a result will cost you money. Overtrading can shake your money management and dramatically increase trading risks.

Tip #7 : Choosing the Time Frame
Choose the time frame that is right for you. Choosing wise means that you are comfortable and have time enough to analyze the market, place and close orders etc ... Some people can't wait for hours for the price to make a move, they like action and therefore prefer smaller time frames. On the contrary, for others 10-15 minutes is a hustle to be able to make the right decision.

Tip #8 : Stay Out
Not trading or standing aside is a position. When in doubt — stay out. If it is not clear where the market will move — don't trade. In this case saving present capital is and absolutely better choice than risking and losing money.

Tip #9 : Use Protective Steps
Learn to use protective stops. Respect them and don't move. Hoping that market will turn in your direction is a very delusive hope. By moving a stop loss further a trader increases his chances to end up with much bigger loss.

When holding to a losing trade too long, and even if funds permit, traders as a rule are very reluctant to accept big losses, thus often continue "hoping for best". In the mean time invested money is stuck in the open trade for unknown period of time ( weeks and even months ) and cannot be used for opening new positions. Not working money — dead money. Also this will result in constant interest payments for holding open positions.

Tip #10 : Keep it Simple
"Keep it simple, stupid" — applies to indicators, signals and trading strategies. Too much information will create a controversial picture of where to trade and when not to. To avoid lots of confusion create a simple but working method of trading Forex.

Tip #11 : Risk Ratio
Think about risk/reward ratio before entering each trade. How much money can you lose in this trade ? How much can you gain ? Now, make a decision if the trade is worth entering. Example : if trader is looking for possible 35 pips gain and possible 25 pips of loss, such conditions are not worth trading. Compare it with the situation when a trader has 100-120 pips of potential gain and only 10-20 pips of possible loss. This is the trade to open !

Tip #12 : Proven Trade
Never add positions to a losing trade. Do add positions when the trade has proven to be profitable. Don't allow a couple of losing trades in a row become a snowball of losing trades. When it is obviously not a good day, turn the monitor off. Often not trading for one day can help to break a chain of consecutive losses. Trying to get revenge can often make things worse.

Tip #13 : Let Profits Run
Let your profits run. Let your position be open for as long as the market wishes to reward you. Of course, for this traders need a good exit strategy, otherwise they risk to give all profits back ... Running two or more open trades gives an option to close some positions earlier and keep others running for higher profits.

Tip #14 : Cut Losses
Cut your losses short. It's better to finish unprofitable trade quickly than wait for the situation to get worse. Don't put a stop loss too far — it's your money you risk. Better calculate the best spot to enter when a potential loss would be minimized. Again : respect your stop and don't move it "cherishing hopes".

Tip #15 : Overlapping Market Hours
Trade currency pairs in respect to their active market hours. Learn about overlapping market hours : when two markets are open and highest volume of trades is conducted. For example, Australian and Japanese trading sessions are overlapped from 8pm to 1 am EST. At that time trader can successfully trade AUD/JPY currency pair.

Tip #16 : Choosing Right Day
Choose the right day to trade. This recomendation is often wrongly taken as an optional thing, because everyone knows that Forex market is open 24 hours a day 7 days a week. Yet, choosing the time to trade can make a difference between successful and hopeless trading.

It's proved and highly recommended not to trade on Mondays, when the market has recently awaken and is making first "probation steps" to form a new or confirm a current trend ; and on Fridays afternoon, during the huge volume of closing trades. The best days to trade are Tuesdays, Wednesdays and Thursdays.

Tip #17 : Fibonacci Levels
Learn about Fibonacci levels and how to use them for trading. Fibonacci can be very helpful in trading, even partially using the study, for example, to determine the best exit, can bring traders to a new edge of trading.

Tip #18 : Signaling Bar
Always ensure that a signaling bar/candle on the chart is fully formed and closed before you enter a trade. A golden rule of trading : "Always trade what you see, not what you would like to see" is the best explanation here.

Tip #19 : Live Trading Signals
If you ask for someone else's advice as about how and when to trade, in other words, choose to rely on live trading signals from other traders, make sure you do it for your benefit, not for disaster. If you use such signals to discover how other traders do analysis and study on the price — you are on the right track and soon you'll be able to do analysis yourself. But if you're just blindly following recommendations and your only task is to push the correct button ... think again.

Tip #20 : Leveraged Account
Using a highly leveraged account comes at a cost. It will, of course, give a trader more financial gear to trade, and also trader's broker will be happy as it will mean higher spread income for him. On the other side a trader signs up for additional risks that multiply with higher leverage in a "friendly tight" proportion.

Tip #21 : Measure Trading Success
Learn to measure trading success by the end of the day, week and then month and year. Do not judge about your trading success on a single trade. To be successful traders don't need to win every trade, they also don't become rich in one trade — they need to be profitable in a long run.

Tip #22 : No Secret Approach
There is no such thing as a secret approach to understanding the market. Take the time to develop a solid trading system and find out that the secret to trading success lies in hard work and constant learning.

Good Luck !
To Your Success

Wingcent Ning
Success-Biz Marketing
wingcent@gmail.com
http://mysignatureforex.blogspot.com
Singapore

6 Forex Trading Tips for Newbies

2008-11-10T09:21:00.000-08:00

6 Forex Trading Tips for Newbies

You have decided to be a trader in the Forex market, and you have no idea on how to begin. Let's first start by defining what the Forex market is and what it does.

The term "FOREX", also known as the FOReign EXchange is a market for the sale and purchase of all kinds of currencies. It originated in the early 1970's when floating currencies and free exchange rates were first introduced. At this time, the Forex market traders were the ones who set the value of one type of currency against another.

Nowadays, the market forces determine the value of a currency against another. One unique aspect of the Forex market is that very little trading qualifications are required of anyone intending to trade therein.

Independence from external control ensures that only the market forces influence the currency prices. As the largest financial market, with trades reaching up to 1.5 trillion U.S. dollars, or USD, the money moves so fast, it’s impossible for a single investor to substantially affect the price of any major foreign currency.

In addition, unlike any stock that is rarely traded, Forex traders are able to open and close any positions within seconds, because there are always a number of willing buyers and sellers.

1. ) The first thing you need to do is open a Forex account. You will have to fill an application form which includes a margin agreement stating if the broker will be allowed to intervene with any trade when it appears too risky. Since most trades are done using the broker's money, it is only logical that he protect his interests. However, once you have established an account, you can fund it and begin trading in the Forex market.

2. ) Adopt a trading strategy, that has proven to be successful for you. Remember that strategies will work differently for different traders, so don't try to adopt a strategy that works well for another trader. It might backfire on you. The two available approaches are either Technical analysis or Fundamental analysis. A combination of the two is a more preferred choice for experienced traders.

3. ) Understand that prices move by trends. Forex has a popular saying, “The trend is your friend.” There are certain movements that have been studied over many years in order to identify a pattern in the trend. These trends need to be understood in order to understand a good trading strategy. For small accounts that are $25,000 and under, trading with a trend may help improving your odds when compared to bi-directional trading. Most newbie’s will look to trade in any direction, when they should be trading with a trend.

4. ) Ensure you know which are the top five currencies pairs in the foreign exchange. These are USD/Yen, Swiss franc/USD, Euro/Yen, Euro/USD and Pound/USD.

5. ) For newbies, it is advisable to maintain two accounts to ensure you learn to play the trading game. Keep one real account, one that you will actually use to trade real money ; and the second account should be a demo, one that you can use to test alternative moves in the trading game. You can easily use your demo account to shadow the trades in your real account so you can widen your stops to see if you are being too conservative or not.

6. ) Always examine the one hour, four hour and daily charts that concern your trades. Although you can trade at 15 and 30 minute time intervals, doing so requires a handful of dexterity.

Good luck !
To Your Success

Wingcent Ning
Success-Biz Marketing
wingcent@gmail.com
http://mysignatureforex.blogspot.com
Singapore

Forex - Putting The Odds

2008-11-10T09:02:00.000-08:00

Forex — Putting The Odds

How does an investor set themselves up for success when thinking about a market as large and volatile as the Forex ?

Also known as the Foreign Exchange market, the Forex allows investors to speculate on the movement of currency exchange rates between different countries. It is impossible to accurately predict the movements of the market all the time but many of the top investors maintain that there are ways to increase your odds of anticipating market fluctuations and capitalizing from them. Here are just a few ways to enhance your chances for success with Forex technical trading :

* Only trade at end of day
* Avoid over-trading
* Do not read FX reports
* Backtest, backtest, backtest !

All investors are tempted to believe that they must constantly be "in the know" or risk getting caught out of position. Thus, these dedicated investors may sit in front of a computer screen all day and monitor their investments for fluctuations. For those living in North America, the end of the business day is 5p.m. EST or 2 p.m. on the West coast and this really is the best time to consider trading — and note the word consider !

At the end of the business day, there are two factors in your favor :

First, traffic tends to be down so there are fewer chances for price fluctuations.

Second, if you wait until the end of the business day, then you can look at information flowing in from the East to help guide your decisions.

Over-trading is basically like going back and back to a casino thinking your odds are actually improving — because they are not !

Over-trading increases your chances of jumping into a position too late and getting burned or out of position too early and missing out on profits. Put stops in place that can safe guard you from losing more than you can afford — and then let them alone and relax !

Reading what someone else says about the outlook on the market is going to do one thing : cause you to question your strategy. None of us are going to get it right every time and no one can predict the future, so reading those reports can only harm, not help, once you have purchased a position. If you are going to read those reports, do so before buying in — after that, just leave them be.

Investors buy and sell positions based upon their theory of the market and where a particular currency pair is headed. While you should not change your stops while already having a position, you can certainly continue to test your theory by backtesting. People capitalize in the Forex market by identifying trends and buying a position on that trend and riding it for as long as possible. Continuous backtesting helps investors hone their theory and better identify trends quickly and take advantage of them for profit.

The Forex market may be the largest and most volatile — but it also holds the greatest potential for profit. The few tips listed above will help ensure your success in Forex trading and they will greatly enhance your odds of success. Be sure to review them carefully !

Good luck !
To Your Success

Wingcent Ning
Success-Biz Marketing
wingcent@gmail.com
http://mysignatureforex.blogspot.com
Singapore

Why You Can Become Wealthy From Trading Forex

2008-11-10T08:48:00.000-08:00

Why You Can Become Wealthy From Trading Forex

Forex Trading has long been touted as a method to Financial Freedom. Is Forex trading as difficult to become involved in as some might have you believe ? Find out how and why you can become wealthy from trading Forex.

For those of you not familiar with Forex Trading, the goal is to profit by moving foreign currencies around. It's a method of investing in international market currencies and it's all about why you can become wealthy from trading Forex.

As more and more people become familiar with how and why you can become wealthy from trading Forex, the popularity of it grows and more and more people jump on the bandwagon. It's avery lucrative and exciting business that can bring wealth to those who get involved. And you can take part from the office, home, and from any country in the world.

There are no time constraints - buy and sell 24 hours a day. It's all done electronically so there are no time constraintsand, it's just another reason why you can become wealthy from trading Forex.

Forex Trading is both difficult and easy to get involved with. It takes a bit to get the hang of it, to understand that it really isn't a game of chance and that there are some proven strategies and that's why you can become wealthy from trading Forex.

What Forex requires is discipline, commitment, a choice of a trading system. As a trader, you have to be able to cut your losses when they are small and when things are doing well you reap the profits. These are very important pointers when it comes to being a Forex trader and it is the secret to success and why you can become wealthy from trading Forex.

If you get in and out of trades in a short period, you reduce your risks which is why many have turned it into a day trading event. There are time honored traditional strategies like swing trading and position trading both of which reduce your risk and that's why you can become wealthy from trading Forex.

Cutting edge technologies with the internet allow you to view real time information and currency prices and it is all for free. Your dream of independence is just a few clicks away. You can make a full time income all from the comfort of your home. That's why you can become wealthy from trading Forex.

Good luck !
To Your Success

Wingcent Ning
Success-Biz Marketing
wingcent@gmail.com
http://mysignatureforex.blogspot.com
Singapore

A Forex Primer — Forex 101

2008-11-10T08:27:00.000-08:00

A Forex Primer — Forex 101

The Forex — or Foreign Exchange — market is the largest, most fluid investment vehicle the world has ever known. Nearly two trillion dollars are exchanged each day across a vast network of computers found in central banks, investment banks, hedge funds, and brokerage firms around the world. This is the most fluid market in the world because it operates 24 hours per day Sunday through Friday afternoon when it shuts down completely.

Around clock trading means that you rarely have problems with gaps ( difference between what commodity closes at and what it opens at the following day — in stocks, the gap can sometimes be devastating ), this never-ending array of profit-making opportunities can sometimes lead to over trading — a very costly mistake because it often defies the logic of most Forex investment strategies and often leads to missed opportunities to maximize profit.

Traders in the Forex operate in units known as "lots". A lot is the equivalent of $100,000 ( unless you opt for the "mini" lot ) and you are essentially trying to predict how the exchange rate between two currencies will fluctuate in the future. While there are literally dozens of potential pairs, the six main players in the Forex are :

* U.S. Dollar
* Euro
* Swiss Franc
* Japanese Yen
* Canada Dollar
* British Pound

International corporations and nations must exchange currency to help finance payroll, secure resources, pay vendors, support infrastructure, etc ... This constant exchange of money is done based on a rate that fluctuates due to a variety of factors, including :

* Psychology — fear, greed, and other emotions play a large role in the markets and can sway rates dramatically ; however, human emotions have always influenced the markets making them predictable based upon enough data and proper analysis.

* Current Events — with a 24-hour news cycle, events from around the globe can quickly influence exchange rates and cause substantial price fluctuations. If investors allow fear ( emotion ) to affect their decision-making, then a "sell-off" panic can set in and artificially deflate exchange rates. However, the "sell-off" and panic may have been predicted if caused by historically relevant factors that triggered a similar trend in the past. Doing your homework is a good way to judge if current events are truly relevant to the true exchange rate before deciding to sell.

* Government Reports — Many analysts gauge the economy and the way exchange rates are trending by a number of reports released by the government on a periodic basis by a variety of agencies. GDP, the prime rate, unemployment figures, consumer confidence, and many other reports have been known to play temporary roles in the exchange rates between nations.

Many investors in Forex use margin to secure lots and you can typically secure 1-$100,000 lot for as little as $1,000. It is not very likely in this day and age of advanced technology and rapid connections for you to lose more than your investment — the account will typically be shut down automatically when it becomes negative but be sure to check with your broker. Small fluctuations in the market can make a big difference for those that are highly leveraged so it is best to ask very carefully about the potential risks when thinking about this option.

While there is no central exchange for Forex traders to congregate, the market remains a great place to seek opportunity and profit. However, be sure to research any investment carefully — especially for hidden costs.

Brokers are not paid a traditional commission — they are actually paid the difference between the bid and ask price on orders so make certain that all decisions are made only after careful research.

To Your Success

Wingcent Ning
Success-Biz Marketing
wingcent@gmail.com
http://mysignatureforex.blogspot.com
Singapore

Begin Forex Trading

2008-11-10T08:15:00.000-08:00

Begin Forex Trading

The object of Forex trading is to determine the rise and fall of the value of a particular currency and trade when a profit can be made.

To learn to trade Forex, investors should select a well-developed and comprehensive program that, at minimum, explains how to :

* Understand the logic behind Forex trading

* Recognize and capitalize on market trends

* Minimize risk and protect open positions

* Build a consistent and valuable portfolio

* React to major economic events impacting global currencies

Review and know the basics.

* What does margin mean ?
* What about types of orders ?
* Or bid/ask ?
* Rollover ?

The more you know the better off you are.

Another important concept to know about is the two important approaches to analysis. These are technical and fundamental analysis. To increase the odds of success, you should understand both of these methods and how to properly apply them.

You will want to belong to at least one forum for Forex traders where members chat about anything related to the Forex market and trading. However be aware that just because someone posts in a forum does not mean he is an expert.

If you are going to choose a Forex training course or program, it is important to do your research. Not all of these programs are equal. Nor will each best suit your individual needs and style.

Often these programs do not go beyond the basics. While basic concepts and a solid foundation are vital, these are not going to be where you will see your results.

Trading the Forex market is not an easy task. A lot of hard work is required. If you do your work and learn a foundation of information to trade on you may gain true financial rewards.

A number of the websites that you can sign up with to do this offer free trial accounts to help you learn before you invest your money. While you won't make any money in the trial accounts if you do well, it is just pretend money essentially, but with the real market conditions.

To Your Success

Wingcent Ning
Success-Biz Marketing
wingcent@gmail.com
http://mysignatureforex.blogspot.com
Singapore

Three Simple Forex Trading Strategies

2008-11-10T07:57:00.001-08:00

Three Simple Forex Trading Strategies

No one ever said that trading success was easy. It takes time and you need to know and understand your market, as well as have a good bit of self control. These three simple Forex trading strategies will help keep you on track.

If someone tells you that you can continuously make money in a foreign exchange market, they are either lying or they have no idea about the market they talk about. Foreign exchange has always been a volatile market and it still is today. Add trading on margin and the volatility goes up even more. But three simple Forex trading strategies can keep you in the green.

For you to make successful trades you need to understand and take into account the data and then make an informed decision based on your understanding and what you expect from the market. Just three simple Forex trading strategies will make all the difference to you.

Never trade with money unless you can afford to loose it

Trading on Forex markets is speculative and don't let anyone tell you differently. That means losses can occur. It's also exiting and somewhat addictive and the more you get involved the harder it is to clearly see what the right thing is to do. These three simple Forex trading strategies will certainly help keep you on track. Trading on Forex should enhance not hurt your life.

One of the keys to the three simple Forex trading strategies is to know your exit strategy. You should also determine what time frame you are making your trades on. What is it you want to get out of your money and the market ? Sure you enjoy the thrill of the hunt but you really need to have a time frame and a goal of where you are going.

Use your three simple Forex trading strategies to do what the pro traders do. 9 and 14 RSI are the most common trend lines and then there are 9, 20, and 40 day moving averages. The closer you want to get to where the pro traders do the more precise your calculations for your estimates are going to have to do.

These three simple Forex trading strategies are just a start to the strategies available to try. If your life needs a little excitement and you could use a few extra dollars do give Forex trading a try.

Let these three simple Forex trading strategies be your guide.

To Your Success

Wingcent Ning
Success-Biz Marketing
wingcent@gmail.com
http://mysignatureforex.blogspot.com
Singapore

Make Money with Currency Trading

2008-11-10T07:34:00.000-08:00

Make Money with Currency Trading

For those unfamiliar with the term, FOREX ( FOReign EXchange market ), refers to an international exchange market where currencies are bought and sold. The Foreign Exchange Market that we see today began in the 1970's, when free exchange rates and floating currencies were introduced. In such an environment only participants in the market determine the price of one currency against another, based upon supply and demand for that currency.

FOREX is a somewhat unique market for a number of reasons. Firstly, it is one of the few markets in which it can be said with very few qualifications that it is free of external controls and that it cannot be manipulated. It is also the largest liquid financial market, with trade reaching between 1 and 1.5 trillion US dollars a day. With this much money moving this fast, it is clear why a single investor would find it near impossible to significantly affect the price of a major currency. Furthermore, the liquidity of the market means that unlike some rarely traded stock, traders are able to open and close positions within a few seconds as there are always willing buyers and sellers.

Another somewhat unique characteristic of the FOREX money market is the variance of its participants. Investors find a number of reasons for entering the market, some as longer term hedge investors, while others utilize massive credit lines to seek large short term gains.

Interestingly, unlike blue-chip stocks, which are usually most attractive only to the long term investor, the combination of rather constant but small daily fluctuations in currency prices, create an environment which attracts investors with a broad range of strategies.

How FOREX Works

Transactions in foreign currencies are not centralized on an exchange, unlike say the NYSE, and thus take place all over the world via telecommunications. Trade is open 24 hours a day from Sunday afternoon until Friday afternoon ( 00:00 GMT on Monday to 10:00 pm GMT on Friday ). In almost every time zone around the world, there are dealers who will quote all major currencies. After deciding what currency the investor would like to purchase, he or she does so via one of these dealers ( some of which can be found online ). It is quite common practice for investors to speculate on currency prices by getting a credit line ( which are available to those with capital as small as $500 ), and vastly increase their potential gains and losses. This is called marginal trading.

Marginal Trading

Marginal trading is simply the term used for trading with borrowed capital. It is appealing because of the fact that in FOREX investments can be made without a real money supply. This allows investors to invest much more money with fewer money transfer costs, and open bigger positions with a much smaller amount of actual capital. Thus, one can conduct relatively large transactions, very quickly and cheaply, with a small amount of initial capital. Marginal trading in an exchange market is quantified in lots. The term "lot" refers to approximately $100,000, an amount which can be obtained by putting up as little as 0.5% or $500.

EXAMPLE :

You believe that signals in the market are indicating that the British Pound will go up against the US Dollar. You open 1 lot for buying the Pound with a 1% margin at the price of 1.49889 and wait for the exchange rate to climb. At some point in the future, your predictions come true and you decide to sell. You close the position at 1.5050 and earn 61 pips or about $405. Thus, on an initial capital investment of $1,000, you have made over 40% in profits. ( Just as an example of how exchange rates change in the course of a day, an average daily change of the Euro ( in Dollars ) is about 70 to 100 pips. )

When you decide to close a position, the deposit sum that you originally made is returned to you and a calculation of your profits or losses is done. This profit or loss is then credited to your account.

Investment Strategies : Technical Analysis and Fundamental Analysis

The two fundamental strategies in investing in FOREX are Technical Analysis or Fundamental Analysis. Most small and medium sized investors in financial markets use Technical Analysis.

This technique stems from the assumption that all information about the market and a particular currency's future fluctuations is found in the price chain. That is to say, that all factors which have an effect on the price have already been considered by the market and are thus reflected in the price. Essentially then, what this type of investor does is base his/her investments upon three fundamental suppositions. These are : that the movement of the market considers all factors, that the movement of prices is purposeful and directly tied to these events, and that history repeats itself. Someone utilizing technical analysis looks at the highest and lowest prices of a currency, the prices of opening and closing, and the volume of transactions.

This investor does not try to outsmart the market, or even predict major long term trends, but simply looks at what has happened to that currency in the recent past, and predicts that the small fluctuations will generally continue just as they have before.

A Fundamental Analysis is one which analyzes the current situations in the country of the currency, including such things as its economy, its political situation, and other related rumors. By the numbers, a country's economy depends on a number of quantifiable measurements such as its Central Bank's interest rate, the national unemployment level, tax policy and the rate of inflation. An investor can also anticipate that less quantifiable occurrences, such as political unrest or transition will also have an effect on the market. Before basing all predictions on the factors alone, however, it is important to remember that investors must also keep in mind the expectations and anticipations of market participants. For just as in any stock market, the value of a currency is also based in large part on perceptions of and anticipations about that currency, not solely on its reality.

Make Money with Currency Trading on FOREX

FOREX investing is one of the most potentially rewarding types of investments available. While certainly the risk is great, the ability to conduct marginal trading on FOREX means that potential profits are enormous relative to initial capital investments. Another benefit of FOREX is that its size prevents almost all attempts by others to influence the market for their own gain.

So that when investing in foreign currency markets one can feel quite confident that the investment he or she is making has the same opportunity for profit as other investors throughout the world. While investing in FOREX short term requires a certain degree of diligence, investors who utilize a technical analysis can feel relatively confident that their own ability to read the daily fluctuations of the currency market are sufficiently adequate to give them the knowledge necessary to make informed investments.

To Your Success

Wingcent Ning
Success-Biz Marketing
wingcent@gmail.com
http://mysignatureforex.blogspot.com
Singapore

Forex ? What is it ?

2008-11-10T07:16:00.000-08:00

Forex ? What is it ?

The market

The currency trading ( FOREX ) market is the biggest and the fastest growing market on earth. Its daily turnover is more than 2.5 trillion dollars, which is 100 times greater than the NASDAQ daily turnover.

Markets are places to trade goods. The same goes with FOREX. The Forex goods ( or merchandise ) are the currencies of various countries. You buy Euro, paying with US dollars, or you sell Japanese Yens for Canadian dollars. That's all.

How does one profit in Forex ?

Very simple and obvious : buy cheap and sell for more ! The profit is generated from the fluctuations ( changes ) in the currency exchange market.

The nice thing about the FOREX market, is that regular daily fluctuations, say - around 1%, are multiplied by 100 ! For example, the exchange rate of "your" pair of currencies increased by 0.6% in the last 4 hours, your profit will be 60% on your investment ! Such can happen in one business day, or in a few hours, even minutes.

Moreover, you cannot lose more than your "margin" ! You may profit unlimited amounts, but you never lose more than what you initially risked and invested.

You can implement your choice ( the pair of currencies, the volume amount ) under any direction to which the market is moving, and yet make profit. It does not matter whether the exchange rate is going up or down : you can always decide to buy Euro and sell dollar, or vice versa - buy dollar and sell Euro. You don't have to physically possess certain currencies in order to perform "buy" or "sell" with them.

How do I trade Forex ?

You select the pair of currencies with which you wish to make a Forex deal. You determine the volume ( the amount of the deal ). You deposit the "margin" ( collateral needed to facilitate the deal. Usually - only a very small portion of the whole deal, say : 1% or 1:100 ).

Before you finally activate the deal, you can still "freeze" it for a few seconds. That enables you to either change the terms, or accept it as is, or altogether regret the whole idea.

When your Forex deal is running ( you hold an "open position" ), you can monitor its status and check scenarios online, whenever you wish. You may change some terms in the deal, or close it ( and cash the profit, if any, or minimize the loss, if any ).

Forex trading involves substantial risk of loss, and may not be suitable for everyone.

Good luck !
To Your Success

Wingcent Ning
Success-Biz Marketing
wingcent@gmail.com
http://mysignatureforex.blogspot.com
Singapore

Forex Currency Trading

2008-11-10T06:42:00.001-08:00

Forex Currency Trading

What is FOREX ?

FOREX stands for the FOReign EXchange market, which is an international financial market where currencies are traded. The foreign exchange market began in the 1970s and is now the largest financial market in the world, with an average daily turnover of US$1.9 trillion. That's thirty times the amount of daily activity on all of the US stock exchanges.

Each Forex trade involves simultaneously buying one currency and selling another. For example, if you think that the Euro will rise relative to the dollar, you would place a Euro/Dollar trade. The forex system would then buy the Euro and sell an equivalent amount of the Dollar. Then, when you want to close your position, you would place a Dollar/Euro trade. This would buy the Dollar and sell the Euro. If the Euro had risen against the Dollar, you would make a profit, but if it had fallen relative to the Dollar you would make a loss.

What currencies are traded ?

Most of the world's currencies are available to trade, but the majority of market action involves a group of major currencies, including the US Dollar, the Euro, the Yen, the Swiss Franc and Sterling.

Where is the Forex market located ?

Unlike most financial markets around the world, Forex is not centralized on an exchange. Instead it operates on a basis known as the interbank market or Over the Counter ( OTC ). As each Forex trade involves two reciprocal trades ( buy one currency and sell another ), these are conducted electronically with any broker who is willing to accept the trade.

Who can trade in the Forex market ?

Traditionally, access to currency trading was restricted to banking organisations, including central banks, commercial banks and investment banks. That's the reason it operates on a system known as the interbank market.

However, the number of non bank participants in the Forex market, which includes multinational companies, money managers, money brokers and private speculators, is growing rapidly. And thanks to the relatively small amount of capital required to open a trading account ( often $500 ) Forex is opening up to more and more people all the time. If you're over 18, have internet access the enough money to open a trading account, the world of Forex is open to you.

When is the Forex market open for trading ?

As Forex doesn't exist within a traditional exchange, it's the only 24 hour financial market in the world. Forex trading begins every day in Sydney and then moves around the globe as the major international financial markets in Tokyo, London and New York open.

In other words, there are always traders somewhere in the world who are actively trading foreign currencies. This means you can make trades and respond to major social, economic and political events day or night. However, there is a short rest period from close of trading on the American financial market on Friday until trading begins in Australia on Monday morning. However, due to the time differences around the globe, this period only lasts for approximately 48 hours.

What is a trading margin ?

Forex trades are made in lots of $100,000. If you had to provide that amount of money to cover your position before you could trade, the market would once again be restricted to banks and other institutional investors. So brokers have established the principle of margin trading. In effect they allow people to trade $100,000 blocks of currency if they can provide an element of security against potential losses.

For example, they may allow people to trade on a margin of 1%( in comparison, traditional stock brokers often require a 50% margin ). This means that they can trade $100,000 blocks, provided their account contains at least $100,000 x 1% = $1000. One thousand dollars will protect the broker against any potential losses that their client makes ( currency values rarely fluctuate by more than 1% in a single day ). If a client's account is reduced by losses ( i.e. reducing the broker's security below acceptable levels ), the broker will close all trades and require an additional deposit before further trades can be made.

Trading margin allows people to control vast amounts of currency with relatively small amounts of capital ( often 50, 100 or even 200 times the amount of capital that they have invested ). This can lead to massive gains, but increases the risk of losing most or all of your investment capital.

How much does it cost ?

Thanks to the trading margin offered by most Forex brokers, it's possible to open an account and get started trading with a relatively small amount of capital.

Forex trades are made in lots of $100,000. However, most Forexs brokes will provide you with a leverage ratio of up to 100:1, which means that you have the ability to control a $100,000 trade with as little as $1000 in your account. Some brokers will provide leverage of 200:1 or even 400:1, which allows you to start with as little as $500 or $250 in your account.

However, please remember that although greater leverage allows you to maximize your profit potential, it also increases the risk factor. The higher the leverage ratio, the smaller trading fluctuation that will be required to wipe out your trading capital. So choose the amount of leverage that you use wisely.

For new traders, it may be safer to begin with leverage of 20:1 or 50:1. This will increase the amount that you need to open an account, but it will reduce the risk of seeing all your trading capital disappear due to a small shift in the value of a currency.

For more information on Forex Trading, please visit at http://www.forexcurrencytradingguide.com

To Your Success

Wingcent Ning
Success-Biz Marketing
wingcent@gmail.com
http://mysignatureforex.blogspot.com
Singapore