The CFD Traders

Don't Be A Standby Trader

noreply@blogger.com (Rod) — Mon, 02 Feb 2009 10:45:00 +0000

The attraction of using a leveraged trading account such as a CFD account is that it is far more flexible than if a trader was using the normal way of purchasing or selling shares in a company. Considerable profits and losses can materialise when an investor uses derivatives for the purpose of profiting from the stock market fluctuations.

One of the phases, which most traders tend to go through is that after a while they seem to confuse "Building More Discipline" with being "Extremely Overcautious" with their trading, to the extend that they reduce the number of times they are prepared to trade drastically and become virtually idle or Standby Traders!

Markets are there to be traded and skilful experienced traders would not do their bank balances any favours by just being market watchers - in my experience once a trader has worked out that he has an advantage over the market, he should not hesitate too much to press the Buy or Sell button and this together with a bit of money management strategy should stand a frequent trader on a healthy and wealthy financial position in the long run for many years to come.

Stay A Daytrader

noreply@blogger.com (Rod) — Thu, 01 Jan 2009 11:29:00 +0000

With the new year started already, I am sure we will be hearing from lots of Stock Market Experts that this year is going to be a good year for the Stock Market and there are going to be lots of bargain shares (stocks) to be had if we do our homework properly.

Well, the opportunities may exist or they may not!

The essential thing to keep in mind is if you are a small investor (trader) you cannot really risk or tie down your small capital on looking weeks or even months ahead -- Instead as a small trader (investor), you would want to employ your funds in something, which would give you nearly an instant return on perhaps daily or at worst weekly basis.

So to achieve the above, you would really want to be a Daytrader and if you happen to have a margin account such as a CFD or a SpreadBetting account, you have the added advantage of both shorting the market or going long as and when you find the right trading opportunities - With short-term trading or daytrading you could virtually close your positions as soon as your initial capital or investment has shown a profit. In other words the flexibilities that daytrading offers you as a trader, should not be overlooked easily.

To stress the nicety of daytrading, let's take trading the Dow Jones Industrial as an example:

We all know that lots of professional traders trade the Dow Jones to make a good living out of .... and we also, know that on most trading days the Dow travels up and down on a certain range -- so if we got ourselves stuck on a long term position, we would consequently be missing on a lot of points which we would be making had we employed daytrading as a means of making our initial investment grew.

Happy Daytrading for the New Year.

Preserving Your Capital

noreply@blogger.com (Rod) — Mon, 20 Oct 2008 12:14:00 +0000

A Good Trader not only knows when to trade but he or she also knows when to stay on the sidelines. Undertaking the latter route is far more important than actually a lot of traders give it credence.

With the huge and unprecedented ups and downs that the Stock Markets across the world have been going through lately, the notion of Capital Preservation must be heeded more than any time before.

Full-time traders are particularly at risk in such market conditions for the simple reason that a lot of them solely rely on trading to make a living for themselves and their families. So it is highly advisable to make sure that they tighten their discipline and stick to their money-management systems more religiously than ever before.

The amateur traders who trade on leverage are particularly advised to be extremely cautious before they commit themselves to opening any trading positions. They at least must make sure they have devised a working strategy for this type of market environment before entering the trading arena and they ought to stop chasing their losses once they realise their trading plan has stopped being effective.

Do Not Get Margin Calls

noreply@blogger.com (Rod) — Wed, 01 Oct 2008 09:33:00 +0000

Due to the financial "Bailout" uncertainty that has been going on for the past few days in America, STOCK MARKETS across the world have been having the biggest degree of volatilities that has ever been recorded in the history of the Equity Markets -- traders have got to be extra cautious if they intend to stay active in this type of environment. Already, some traders have incurred heavy losses and some have gone completely bust as a result of the markets wild swings within the past few days. Remember Stock Market will take no prisoners!

Good traders will always try to adopt the following rules if they want to stop getting "Margin Calls" from their brokers
or getting wiped out completely:

Do not be tempted to open large positions if you can help it.

As soon as your position is in profit, move up your stop losses accordingly.

Do not add to your losing positions.

Stay away from the markets, if you have not traded in such environments before.

Lehman Has No Brothers

noreply@blogger.com (Rod) — Tue, 16 Sep 2008 10:53:00 +0000

With the collapse of Lehman Brothers and the search for more funding by the American giant insurance company, AIG, the stock markets throughout the world have been having one of its worst moments of its recent times as regards to daily losses they have encountered. The "Dow Jones Industrial" lost a massive 504 points (more than 4%) last night during the market hours and a further 100 points when the Asian Markets were going through their "free fall parachuting".

However, if you were lucky to be a very experienced trader then you would definitely be able to take advantage of such market volatilities. But my advice to inexperienced and newbie traders would be, in such market environments, simply try to be an observant rather than a participant of the market -- this type of market, when it happens, does offer an "Excellent Opportunity" for the "Novice Players" to take in, what really can happen when markets go through wild swings -- if you can fight the urge from trading by opening a hasty position based on compulsion, then as an amateur trader you will be quids in and at the same time you will be extremely happy with yourself afterwards that you did not gamble your money away in an irresponsible manner!

Traders, Close All Positions At The End Of The Day!

noreply@blogger.com (Rod) — Mon, 08 Sep 2008 15:28:00 +0000

The News of the US Federal Government to take over the two "Mortgage Giants" Fannie Mae and Freddie Mack at the weekend, had a frantic effect on the opening of the World Stock Markets.

The Dow Jones future prices gapped up nearly 300 points when it reopened on Sunday, Nikkei closed up over 400 points, the ASX200, the Australian Index ended up nearly 200, the Footsie gapped up nearly 300 points at the open ......

The essence of the above, should make it clear to all "traders" that they should think twice if they are tempted to leave their positions open to the next day, specifically where the weekend is involved, as the after market news could really prove to be detrimental to their trading accounts! Of course this is if "Guaranteed Stops" have not been put in place.

In situations like above, where the market can gap up or gap down by a large margin, a trader could risk losing all his or her capital in one day if he or she has left his or her destiny to fate. So please make sure you apply tight discipline to your trading method, if you are to avoid having painful days during your trading careers.

Dow Jones Contrarians

noreply@blogger.com (Rod) — Fri, 05 Sep 2008 08:08:00 +0000

If your style of trading is to be a "Contrarian", I would recommend, if you are an index trader who happens to trade the Dow Jones, S P 500, Nasdaq etc Do Not rush to open any trading positions as soon as the index you're trading has dropped or gained only 2% or less in either direction, unless you're just scalping for a few points.

The nature of the US Indices recently has proved that in the case of days where there are a bunch of good or bad news, they seem to over-react to the situation.

Let's analyse yesterday's US market actions as an example:

The ADP Employment figure came in as 33k which was a shade above the forecast.

The Initial Claims was 24k worse than the estimated forecast.

The Productivity-Rev did come in better than it was forecasted.

The ISM Services was above 50 and better than consensus.

Taking all the above factors into account, "one" would not have expected for the "Dow Jones" to have dropped 344 points (nearly 3%) and for all other indices "S P 500" and others to have done the same. So we can see how the market over-reacted negatively to the Employments News.

I wrote this article specially for the beginner investors, who may use margin accounts for trading. As by having studied their way of trading, I see a lot of them falling into the trap that if an Index or an stock sheds 1% it's time to buy that stock or Index!

Don't Be An Angry Trader

noreply@blogger.com (Rod) — Wed, 27 Aug 2008 10:40:00 +0000

It's happened to me, it's happened to you and it's happened to all those who have been trading for a while ..... Getting Angry When We Have:

- just hesitated to push the activation button to place a High Probability Trade (HTP) which we thought had the ideal set-up and the trade has gone to be a real winner! So what do we do next ...? Can we forget about the incident and still keep our composure and carry on trading as normal....?

Unfortunately, as we humans are controlled by our emotions, the pre-programmed chip inside of us takes over our "central processing unit" and buggers up all our previous positive efforts in a matter of a few minutes after having allowed our anger to get the better of us and went on to place a chancy trade to win what we should have won in the good trade, which we have just missed due to our indecisiveness.

(Had I been an sceptic (me..? never!) ..... I would have said "it seems that this emotion chip must have been designed mostly for the benefit of CFD or SpreadBetting companies like the CMC markets, IGINDEX or their Irish counterpart spreadbetter Paddy Power", who incidentally today announced a profit of over 40 million Euros, thanks for the existence of the "emotion chip" inside most of us stock market traders!)

Now, when a trader gets himself to a situation like that and ends up getting wiped out, he must sit down and do some serious thinking as whether he is going to continue trading or give up the business completely -- I would advise all traders and "would be traders" specially those who trade on margins i.e. trade using CFD's or SpreadBetting .... "unless you are completely in charge of your emotions DO NOT TRADE!"

S & P 500 Declines 29%

noreply@blogger.com (Rod) — Mon, 25 Aug 2008 15:48:00 +0000

According to Standard & Poor's report the second-quarter earnings for companies which are listed in the S&P 500 index were 29% lower than the previous year. This was the 4th declining quarter in a row for the companies in the index.

During the second quarter the Energy Sector have contributed 25% towards the operating earnings of the S & P 500, whereas the Financials have been the culprit for depreciating the index's components by %28.

Fuld not The Man at Lehman!

noreply@blogger.com (Rod) — Mon, 25 Aug 2008 15:46:00 +0000

The Observer reported on Sunday that Richard Fuld the-in-trouble chief executive of the investment bank Lehman Brothers is fighting an internal battle to keep his job.

The company has lost nearly 80% of the value of its share price this year despite the stock price surging last Friday as a result of take-over speculations.

But even if a buyer comes forward, still Fuld will have to step down from his position according to well informed sources within the company.

According to The Observer Lehman's Chief Operating Officer Bart McDade is carrying out several of Fuld's previous duties.

Mind the Oil Spillage!

noreply@blogger.com (Rod) — Tue, 12 Aug 2008 19:28:00 +0000

It wasn't long ago that everyone thought Oil would soon reach the near boundaries of 200 bucks per barrel. In fact, I know of several traders who were holding to their long CFD positions for exactly the same reason. But unfortunately for them the bubble burst before the price ever reached $150. I wonder if the Goldman Sachs's people managed to get out of their long positions in time before they really burnt their fingers seriously. Because as some of you may know Goldman were heavily long on the black stuff. In fact they were part of the reason if not all, for the Oil to have reached the price level that it did, as they upgraded the price on a number of occasions. What a joke ...!

What's been happening in the last week or so, has now been the reverse of before ... i.e. the fall in price cannot be stopped -- from $148 a couple of weeks ago, it is now down to $114 a barrel.

Obviously, the strength in Dollar has caused some of the fall, but who can argue with the famous saying of "Let The Trend Be Your Friend..."?!

Don't Get Burned by Oil

noreply@blogger.com (Rod) — Fri, 09 May 2008 18:23:00 +0000

Making a living out of trading, whether you trade using a leveraged account such as CFDs, Futures or otherwise, on normal day to day stocks is hard enough, never mind trying to catch the wild swings we have been having on Crude Oil, recently.

I know of quite a number of experienced traders who have burnt their fingers trying to play with the black stuff with the limited amount of margins they have had at their disposal.

If you are the type of trader who is compulsive in trading an instrument such as Oil, I could only recommend to you that keep your initial stakes at minimal and most definitely use Stop Losses to limit your losses. It is extremely possible that in trading such an instrument a trader could easily get wiped out and throw away the results of months of earnings and efforts on a single trade.

One other thing you should never do as a good trader is try to guess the top or the bottom of any market -- you should just be content with taking a day's pay as how you see a trade develops on any given day, unless you are a big player with a deep pocket, in which case, you could try having swing trades aiming for the big pay-outs.

Day Traders, are you making money?

noreply@blogger.com (Rod) — Mon, 11 Feb 2008 10:56:00 +0000

If you are not, you should be back on the drawing board and reviewing your strategies - the choppiness in the market should always suit the day traders style of trading. Scalping the markets could be very rewarding in the present market conditions if you are day trading and sitting in front of your monitors for many hours of the day - pick your market and use your charts effectively and with a leveraged account such as CFD, Spread betting or Futures, you should be making good money.

Stick to making some 10 points here and there and by the end of the day, you should be showing 50 points profit at least - if you are not making any money in these market conditions then stop trading altogether and go back to learn more as you are definitely doing something wrong!

Have faith in your ability and press that buy/sell button and don't allow your profits turn into a loss by being greedy - be ruthless to the market as the market will be ruthless to you if you let your concentration abandon you.

Above all, only trade using an instrument which you are comfortable trading with.

Futures Trader Faces Uncertain Future

noreply@blogger.com (Rod) — Tue, 22 Jan 2008 12:07:00 +0000

The Markets across the world have been racing against each other to see which market can lose more of its value!

In the meantime, some traders have been losing serious amount of their hard earned capital.

Normally, volatility in the stock market can be considered as a great opportunity for the experienced traders to make vast amount of money. This is more so when trades are being struck on margins i.e. trading CFDs, futures etc. Leveraged trading has its disadvantages too, as it was brought to my attention that this Futures Trader lost most of his capital on a trade position he opened last Friday before the US Market closed.

When I read about his losses, I really felt his pains -- we traders do really have a lot of sympathy for other traders, as "trading the stock markets successfully" requires enduring a lot of pains and lonely days sitting behind a screen to master.

To try to avoid financial disasters like the one happened to our colleague trader, traders must be very vigilant in such market environments of the recent days. Money Management is the absolute "must" - risk and reward must be precisely measured before a trader commits himself to opening a new trade - all trade positions must be closed before the end of the market on the same day, unless a trader trades with unlimited amount of margins!

Trading With No Confidence

noreply@blogger.com (Rod) — Thu, 29 Nov 2007 17:49:00 +0000

All traders at some stage during their trading careers go through a period of time, which they lose their confidence.

This applies even more to those traders who trade on Margins, such as CFD or FOREX traders. The reason is because of the high frequency in the number of trades that some of these daytraders use in order to make their profits -- and the more a trader trades the more he or she is likely to get it wrong -- and when they happen to go through a bad patch, it could really hurt their pockets deeply -- and I guess that is one of the dangers and disadvantages of being a CFD TRADER.

Recently, a CFD TRADER who happens to be a good friend of mine and I have a lot of respect for, has decided to stop trading CFDs and he is trying to take on FOREX TRADING instead -- when I found out about his decision, I was extremely surprised, as he had done pretty well at daytrading using CFDs in stocks and indices for a number of years -- but apparently he must have had a few big hits, which had made him make such a decision.

So, what should a TRADER do when he starts having a bad run and his confidence plummets?

He could do a number of things:

The obvious thing he could do would be to pack up trading for a few weeks and take a break.

But what I would do as a professional CFD daytrader, and I have done this in the past, would be to lower down my stake money to absolute minimum and cut down on the number of my daily trades -- and only trade when I think the odds are heavily in my favour -- I can always increase my stake money when I start getting things right again --- remember the market is always there for you but your money may not!

Some traders may have the opinion that the best thing to do in cases like that would be to stop trading but watch the market more carefully than before and start trading again when you get your full concentration back -- lack of concentration have cost a lot of us a lot of money in this game I am sure -- it's always best not to trade when we cannot fully focus on our trading.

Trade What You See

noreply@blogger.com (Rod) — Thu, 20 Sep 2007 11:21:00 +0000

One of the most used sayings in the Stock Market Trading Business is "Trade What You See ...." and if most traders took this simple advice seriously and understood its real meaning then I am sure they would increase their trading profits multi-fold.

When reading through some of the CFD or Forex forums, one cannot help noticing that the majority of traders seem to form a rigid opinion on how the market will shape or perform in the future; something which I doubt many traders could possibly forecast correctly.

At the moment with the financial mess which the banks have got themselves into it would be extremely unlikely that even the biggest financial guru would be able to come up with "a viable scenario" as what would happen to the stock market 2 days from now never mind months ahead.

Bearing the above comments in mind and having access to a leveraged account such as CFD why not just be content to grab whatever profits that you can make from a market which is not really sure of itself and its direction until the time that a solid trend is formed on the basis of good fundamentals in all foundations which are required to hold a stock market together. So trade what you see and not what you think you will see in order to stay in the game or even prosper from it!

Day Traders' Paradise

noreply@blogger.com (Rod) — Tue, 21 Aug 2007 08:32:00 +0000

The volatility in the STOCK MARKETS across the world due to credit problems with financial establishments in recent weeks have offered some great opportunities for experienced day traders to accumulate wealth.

Most experienced TRADERS and MARKET WATCHERS would agree that the market will carry on being panicky, hence volatile until the day that the credit crisis are put behind us. So if you are trading daily and watching the market's every move you should be well placed to make good profits - in my opinion these are not times for long-term trading and anybody who does that is only throwing away valuable time and of course his or her hard-earned money.

Last Friday, the US Federal Reserve cut down the lending rate to banks, which was a temporary measure to calm down the market and this made a positive effect on the day and consequently made all the major WORLD MARKETS to rally.

The credit crisis cannot disappear overnight and it will stay with us for a while. For instance, last night Capital One, after the close of the US market, hit the market with more negative news that it will close down its wholesale mortgage unit. TODAY, the German Bank WestLB AG warned that it has become very difficult to acquire FOREIGN CREDITS and the FUTURES are already down as a result a considerable amount.

My advice to junior traders who use CFD or other leveraged accounts to trade, is a word of caution. Make sure your stakes are kept to a sensible size and in a volatile market I would always take profits when they arise for the reason that profits can turn to a loss in a blink of an eyelash.

Practise being a patient Trader

noreply@blogger.com (Rod) — Thu, 28 Jun 2007 13:24:00 +0000

If you have been TRADING as long as I have, you ought to agree with the statement that "one of the factors that most short-term traders like CFD and FOREX traders cannot make regular profits from the STOCK MARKET or the CURRENCY MARKET is because they trade too often (overtrade)".

This is exactly the habit, which I followed when I first started my trading career a few years ago. The number of times, which I had made huge amount of money in the mornings from scalping using CFDs and by the time the market was ready to close, I had given it all back, was numerous.

So I kept pressing myself for applying more control and self-discipline -- eventually, I managed to apply the discipline, which was and is necessary for any traders to come on top at the end of a each trading session.

As good traders, we must remember AT ALL TIMES that not losing in TRADES we enter, is just as important as winning the TRADES we get ourselves into.

For instance, I was very pleased with myself last night, I did not fancy opening one single CFD POSITION the whole day yesterday as the US MARKET looked unsure which direction it was going to head, but as we approached the closing times the MARKET seemed on its way for an upday, so I took this opportunity in opening 2 LONG CFD positions in ASX200 and the German DAX30 and to my delight when the markets opened in Europe this morning, I managed to close both positions well in profits.

I like to add another point, which a good trader needs to have in order to practise being a patient trader --- and that is vision about the markets he or she trades in -- the more clearly one can see what FACTORS move the MARKET the better timing a trader can apply in entering the trades within that market.

Markets are very Edgy at the Moment

noreply@blogger.com (Rod) — Fri, 22 Jun 2007 08:28:00 +0000

Short-term TRADERS would love it when there is volatility in the market .... and fears are necessary to have if the markets are going to be volatile -- and what type of traders are going to benefit most from this type of market's volatility ....?

Well, due to the very nature of what CFD trading has got to offer, I would say the CFD TRADERS are amongst the first group of traders who could make a killing when the market is going up and down in a short space of time during same day of trading.

Needless to say that in order to take advantage of a volatile market, one must be a fully professional Stock Market Trader.

Yesterday, was a great example of how the market's wild movements can really produce big rewards for us CFD TRADERS:

The Dow Jones started the session going down by about 90 points to roughly 13400 and within minutes it recovered all of its losses and more - soon after it was down again by 50 and up once more to a session high of 13565 and eventually ending the day up by 57 points at 13546.

So fears in the market can be great for short-term traders like the CFD traders and currently the cause of these fears are partly due to the Bonds' rates going up and also, some major selling off of the Bear Stearns hedge funds -- In the meantime if you are using CFDs for your trades, you may wish for more times like this as I do ...!!

Recent Market Rally

noreply@blogger.com (Rod) — Tue, 19 Jun 2007 10:51:00 +0000

Has the recent Market Rally been justified ....?

Well, let's look at how it all happened:

Last Wednesday, the Beige Book Day, the market rallied (the Dow) 187 points, basically on no fresh news except a hint from the Fed that the inflation seemed to be within the expected range!

The following day came the results for the PPI which itself was above the forecast of +0.6% BUT the Core PPI was as expected and yet again the market reacted positively to these numbers and pushed the Main US Index, the Dow higher by another 71 points.

Friday, the market looked to yet another inflationary gauge the CPI -- the CPI itself was slightly higher than the estimated figure of +0.6% BUT the Core CPI emulated the previous day's C.PPI by matching the market's estimates at +0.6% AND YET AGAIN the market astonishingly rallied for the 3rd day on the same fundamentals by another 86 points as far as the Dow was concerned.

The extent of the 3-day rise was such that even the most optimistic of the bulls could not have thought they had been given another Christmas day in a short space of time, specially that early in the week some of the bulls were about to think that their run may have come to a halt when the US market had a very bad day on the Tuesday --- Even the slight chance that the bears may have thought they may have had in the sense of Friday having been the Options Expiry day, hence the possible volatilities, did not materialise in the sense of any opportunities for some consolations and markets finished the week on a very strong footing.

How to place Stops and Limits

noreply@blogger.com (Rod) — Thu, 14 Jun 2007 11:51:00 +0000

One of the most important factors in accumulating winnings as a Stock Market Trader is knowing when to terminate a trade. This is more so when a trader is trading through highly leveraged trading methods such as CFDs or FOREX. Recently, Doug Newberry has given his views on this subject matter which I would like to share it with you:

Getting into a trade is often the most glamorous part of stock trading. Knowing which trades are likely to turn a profit and diving into those trades can make a day trader feel really knowledgeable and involved in the market.

Being a good trader doesn't only mean knowing when to get into a trade, it also means knowing when to get out. The following guidelines are meant to get you started, but remember that trading is a continuing journey of discovery about the tradable nuances of market moves.

Make sure you're familiar with historical support and resistance levels. Also, check out momentum readings as well as Bollinger Bands to inform you about where to put stop and limit orders.

It's also a good idea to use trailing stops. They will allow you to ratchet up a sell stop slowly as your positions change to be in your favor.

When getting involved in stock trading, sometimes avoiding mistakes is more important than doing the right thing. Don't place your stops according to how much money you need to make. The market doesn't distribute profits based on the needs of its investors. Just because you need to make 500 dollars this week and you can't afford to lose more than 250, the market doesn't really care.

Sometimes the amount of money you need to make will correlate with how you set your limits and stops. However, these figures rarely work out to be the same. Thus, you should never use your needs as a guide to where to place your stops and your limits.

Another important thing to remember is not to invest when you are "on tilt". Being on tilt means that you have just lost some money on a trade and you want to make it back quickly. Suppose you have just lost $300 on your last trade. You shouldn't set your exit limits to make all that money back on your next trade. After all, the smart limits on this next trade are not dictated by how well (or how poorly) you did on your last trade.

Stock trading "on tilt" is a sure way to lose money. Use the stock trading tips mentioned earlier to guide your trades rather than using impulses based on flimsy reasoning and financial need.

Always let the market determine where you should put your stops and how you should set your limits. Letting go of your expectations will help you be an objective trader and will increase your profits.
About the Author:

Doug Newberry founded Investing Systems Network. As one of its directors, he helps provide Stock Trading tools and services to more than 20,000 customers in more than 70 countries to help them become more disciplined, better investors.

Do You Want to be a Forex Trader

noreply@blogger.com (Rod) — Fri, 08 Jun 2007 09:01:00 +0000

Forex or CFD? Although, these two methods of trading the financial markets have lots of things in common, but it seems to me that a lot more people are trading in Forex than CFDs. If you are thinking to join the millions of Forex traders already out there, here is some good tips by Phil Smulin:

Currency trading a.k.a. Forex Trading must be one of the most controversial subjects of our time and all with very good reason. The world of Currency Trading is no longer the exclusive playing grounds of Banks, governments and influential financial institutions; we live in an era where the Currency Market is available to anyone who can at least open a trading account of $300.00.Trading Currencies have never been more accessible to the individual than now. But like every industry there are a group of role players that make the rules and the obviously they are always winning (making money that is) despite of anything in the market place.

Thousands and thousands of individuals have tried their "luck" on the currency market the past 10 years but only a handful are making a consistent success of currency trading. The average live span of a self directed currency trader is anything from 3 - 6 months before they quit- these are figures that were announced by one of the biggest retail brokers a while back. This makes one think why only a handful are successful and why a whole lot of people claim they are successful currency traders while they are not. One can argue that people would very much like to be successful at currency trading and when they realize they are not making it they simply fake their success by ways of a website claiming that they have discovered the gold mine and the gold.

There are many ways to engage on your currency-trading journey and chances are that you will get hurt, in fact if you go to Google and type in the word learn currency trading will soon realize that every second guy on the Internet has a currency-trading product to sell you.

The proposed steps to start trading are to firstly familiarize yourself with the language used in the Currency Market Place and secondly you need to understand the rules of the Currency Trading Market environment. These two aspects are very important but the most important part is to learn how to think like a profitable currency trader. These three aspects are very important and they are the only potential barriers to prevent you from success. You need to get in contact with a decent Currency Trading service provider, someone who can introduce you to the right and important aspects of Currency Trading. We recommend that you look very selectively when you decide on such a currency trader service provider. Make contact with them and challenge them with questions like "why you should choose them to educate you on the subject of currency trading"? Also check out their website, most of these websites do not give enough information about currency trading and some of these websites simply look trashy!

If you are after decent currency trading education, support and mentorship, you do not need to look further than Euro Traders Euro Forex Trading System. This is a group of Currency Traders who decided to make their system available to the whole wide world and also to back that up with quality support free of charge. What make them different is the fact that they are actually anticipating market activity (like traders should do) rather than discussing what the market have done. "The proof is in the pudding", so the saying goes, so go and have a look at what Euro Traders have to offer and look at what their happy currency trader clients have to say about them

There is after all hope for you to become a profitable self directed currency trader, the question is whether you have the discipline to take the right steps to make it happen. To Your Success!
About the Author

Phil Smulian is a reviewer for Forex training specialists, Euro Forex Trading Systems (www.euroforextradingsystem.com) or for more info on currency trading (http://www.euroforextradingsystem.com/currency-trading.html)

Go With the Trend

noreply@blogger.com (Rod) — Tue, 29 May 2007 16:38:00 +0000

This time I have picked an article by David D. Wells, which some of the newer traders may find useful. In it David tries to explain how you can make lots of money by jumping on the bandwagen or following the trend as we traders say:

Money is one of the biggest concerns for most people. Learn to master money and that success can transfer over to every other part of your life if you let it. As you already know mastering money is not easy but it can be made simple with some little-known techniques.

The techniques I am going to reveal here have been responsible for literally millions of dollars being created and even billions of dollars, as mentors such as Jim Rogers have taught me.

Jim Rogers is one of the greatest commodities traders in history. By my estimates he has made well over $1 billion trading commodities. Learning some valuable lessons from Jim allowed me to turbo-charge my profits.

FOLLOW THE MONEY: You can earn large amounts of profits by first letting the wealthy use their money to search for opportunities and then jumping on board. Find out where the big money is investing and get in. This is sometimes referred to as following the trend.

You can literally make tens of thousands of dollars doing this. The trend is your friend is a phrased used often by me and other successful traders.

KNOW WHEN TO GO: You must be careful to recognize when the trend has ended. Amateur traders often get in when it is too late because the trend has ended. Another challenge is they get in a trade and stay too long.

Unless the market is already trending down there really is no way to know if it is too late however you can limit your exposure to risk. Use a tool called a STOP LOSS. This does exactly what it implies, it stops your loss.

This tool should be used on every trade every time. This tool also keeps you from staying too long in a trade. It is easy to use. At the time you place your trade also place your stop loss meaning where you want to exit a trade if it does not continue to go in your favor.

BONUS TIP: As you make profits cancel your old stop loss and enter a new one so that it locks in a certain amount of profits. As you continue to make money keep moving your stop loss to lock in more and more profits.

USE LEVERAGE: You must learn how to effectively use your money. Most people use their money on a 1:1 basis. A few people know how to use their money on a 1:2 basis. The great traders use their money on a 1:10 or even a 1:20 basis. This means that for every $1 they invest they control $20.

For example, if you invest $1,000 do so to control $20,000. This is leverage at work. Your risk has not been enhanced because as previously discussed you will use a STOP LOSS.

This type of leverage that David has just mentioned is what we CFD Traders use.

Now let us take a look at a market to apply these techniques. Since 2001 Gold has been in an uptrend. Will it end soon? Who knows for sure but the analysts tell us that it will not end anytime before the end of the decade.

If you had invested $1000 in Gold in 2001 you would have $40,000 at the time of this writing. In six years you would have earned 40 times your investment!

This is just one market. There are many, many other markets where these techniques can be applied.

Crude oil, of which gasoline is made from, is also in an uptrend. If you had invested $2,000 in crude oil at the end of 2003 as of this writing you would have $30,000. In four years you would have earned 15 times your investment.

The good news is if you invest correctly there is still plenty of money to be made.

Learn more by visiting http://www.WealthCodeBreaker.com.
© Copyright David D. Wells. All rights reserved. You are welcome to forward the entire Article to anyone interested as long as it is not edited in anyway and includes the Resource Box. He is a superstar trader and bestselling author. Let him show you how fortunes are made in the 21st century. Subscribe to his free newsletter at www.themoneymotivator.com.

The Dow took a Bow

noreply@blogger.com (Rod) — Fri, 25 May 2007 08:53:00 +0000

Strange behaviour by the Dow yesterday - When the figures for the New Home Sales were released 30 minutes after the US market opened, which turned out to be way above the forecast, 981K vs 860K expected, the Dow spiked up by nearly 70 points to the all time record of 13,625. Minutes later the market as a whole were struggling to hold on to their gains and soon found themselves on the red carpet - in fact NASDAQ Composite and NASDAQ-100 were even bigger losers than the Dow in terms of percentages - they both shed nearly 1.5% by the time it was time to go home.

Ironically, the reason for the sell-off was the strong Home Sales figures, hence the possibility of FED having to raise the interest rates!!

Regarding my own CFD Trading, my plan for the day paid off - earlier on in the day, I had set a Limit Sell Order at 10 points above the nearly previous high; at 13,620 which got hit by the system ... and closed the position when it descended to 13,545 for a juicy profit of 75 points - as usual with hindsight, I could have got a lot more out of my CFD short position as the Dow went a lot lower into the low 13400's whereabouts - but still a nice profit at the end of yet another trading day...

Hard Commodities Fall

noreply@blogger.com (Rod) — Tue, 22 May 2007 22:15:00 +0000

Despite upgrades by Goldman Sach for the prices of copper, aluminium, nickel and zinc for 2007, the prices fell today on LME and US markets, with the biggest losers being nickel -5.13% and copper -4.65%. Gold also lost some of its recent shine.

Goldman still believes that “strong” growth in China will offset “weakness” in US demand.

In a separate note JPMorgan is calling "Investors who think it is too late to get into commodities-related stock" Crazy! Whether they are saying this because they are concerned about me and you as individual investors or they are worried about the returns on JPMorgan Natural Resources Fund (UK-registered), nobody will ever know!

I have found the best way to play the Natural resources is to have CFD positions on the Australian index ASX200, which is heavily biased towards the miners. So far I have been showing good profit on my CFD trades. Hope my luck continues ...