FX Online Trading

All About Forex – What You Need To Know

2010-03-27T21:55:00.001+02:00

In order to succeed successfully in forex trading you need to know what the purpose of trading forex is. Forex trading as you know is the trading of online currency and the key to success is to buy low and sell high just as with any other market. You task as a forex trader is to try to determine the trend of the particular currency you are looking to either buy or sell and to utilise the forex trading strategies to ensure that a profit is made.

Now that you know the purpose of forex trading the next step in knowing all about forex is to understand the codes, definitions and numbers used when trading. All currencies used in forex trading are assigned a three letter code. An example of this is the US dollar which is USD or the Euro EUR. Online currency trading is done in combinations that are known as a cross and these are represented by 6 letter words with the more expensive currency coming first. An example of this is GBPUSD which will show you how many US Dollar you will need to pay for one British pound. These rates are shown as five digit numbers for example GPBUSD = 1.6262 which means that 1 British pound is worth 1.6262 US dollars. When the rate changes the change will be displayed in bold, eg GPBUSD = 1.6264 which will mean that the rate has moved by 2 points. Knowing this is the key to successful forex trading and your key to profit.

When you enter the forex trading market you will enter as a buyer or a seller of a particular currency. If you are a seller you price is known as the ASK price and the buyers price is known as the BID. You can only buy currency from a seller with an asking price the same as the BID price.

These are the main beginner’s points to note when it comes to forex trading and knowing what the purpose of trading forex is and knowing all about forex before you enter into the market can make a big difference when it comes to your profits.

Forex Trading Education: Things You Should Know About Forex Trading

2010-03-16T17:32:00.001+02:00

How difficult is it to make money trading the Forex market? How much time does it take to actually be able to make a living trading the Forex market? These and other important aspects of trading are to be discussed in this article.

Trading the Forex market has many benefits over other financial markets, among the most important are: superior liquidity, 24hrs market, better execution, and others. Traders and investor see the Forex market as a new speculation or diversifying opportunity because of these benefits. Does this mean that it is easy to make money trading the Forex Market? Not at all.

Forex brokers agree that 90% of traders end up losing money, 5% of traders end up at break even and only 5% of them achieve consistent profitable results. With these statistics shown, I don’t consider trading to be an easy task. But, is it harder to master any other endeavor? I don’t think so, consider musicians, writers, or even other businesses, the success rates are about the same, there are a whole bunch of them who never got to the top.

Now that we know it is not easy to achieve consistent profitable results, a must question would be, Why is it that some traders succeed while others fail to trade successfully in the Forex market? There is no hard answer to this question, or a recipe to follow to achieve consistent profitable results. What we do know is that traders that reach the top think different. That’s right, they don’t follow the crowd, they are an independent part of the crowd.

A few things that separate the top traders from the rest are:

Education: They are very well educated in the matter; they have chosen to learn every single and important aspect of trading. The best traders know that every trade is a learning experience. They approach the Forex market with humility, otherwise the market will prove them wrong.

Forex trading system: Top traders have a Forex trading system. They have the discipline to follow it rigorously, because they know that only the trades that are signaled by their system have a greater rate of success.

Price behavior: They have incorporated price behavior into their trading systems. They know price action has the last word.

Money management: Avoiding the risk of ruin is a primary subject to the best traders. After all, you cannot succeed without funds in your trading account.

Trading psychology: They are aware of every psychological issue that affects the decisions made by traders. They have accepted the fact that every individual trade has two probable outcomes, not just the winning side.

These are, among others, the most important factors that influence the success rate of Forex traders.

We know now that it is not easy to make money trading the Forex market, but it is possible. We also discussed the most important factors that influence the rate of success of Forex traders. But, how much time does it take to have consistent profitable results? It is different from trader to trader. For some, it could take a life time, and still don’t get the desired results, for some others, a few years are enough to get consistent profitable results. The answer to this question may vary, but what I want to make clear here is that trading successfully is a process, it’s not something you can do in a short period of time.

Trading successfully is no easy task; it is a process and could take years to achieve the desired results. There are a few things though every trader should take in consideration that could accelerate the process: having a trading system, using money management, education, being aware of psychological issues, discipline to follow your trading system and your trading plan, and others.

Currency Trading

2010-03-08T21:18:00.001+02:00

Have you heard about FOREX? How currencies are traded?
When you think about Forex, what do you think of first? Which aspects of Forex are important, which are essential, and which ones can you take or leave? You be the judge.
Let’s talk about FOREX and advantages of FOREX trading.

The good thing about FOREX is that the amount of money you need to place a trade (known as "margin") is all that can be lost!

Of course, with the proper self-taught education you will win more than you will lose, but you should know that despite the high leverage of FOREX trading (200:1 is possible, which means that when you put up $1 the trading vendor will allow you to trade it as if you have $200), it’s still less risky than futures (commodities) trading. And when you trade stocks you can’t get this type of leverage.

Because of the FOREX market’s liquidity and twenty four hours continuous trading, dangerous trading gaps and limit moves are eliminated. Orders are executed very quickly, without slippage. If you do your research and find good brokers, they will automatically close some or all of your open positions if your account’s equity falls below the level required to hold the positions. You’ll never lose more than you have in your FOREX account.

Currencies are traded in dollar amounts called *lots* -- One lot is equal to $1,000, which controls $100,000 in currency.
This is the "margin" I talked about above. You can control $100,000 worth of currency for only 1,000 dollars.

Currencies are always traded in pairs. The most popular currencies and their symbols are:

USD - The US Dollar
EUR - The currency of the European Union "EURO"
GBP - The British Pound
JPN - The Japanese Yen
CHF - The Swiss Franc
AUD - The Australian Dollar
CAD - The Canadian Dollar

A currency can never be traded by itself, so you can't trade a USD by itself. You always need to compare one currency with another currency to make a trade possible.

The most commonly traded currency pairs are:

EUR/USD   Euro / US Dollar
"Euro"

USD/JPY   US Dollar / Japanese Yen
"Dollar Yen"

GBP/USD   British Pound / US Dollar
"Cable"

USD/CAD   US Dollar / Canadian Dollar
"Dollar Canada"

AUD/USD   Australian Dollar/US Dollar
"Aussie Dollar"

USD/CHF   US Dollar / Swiss Franc
"Swissy"

EUR/JPY   Euro / Japanese Yen
"Euro Yen"

The currency on the left is called the base currency. The currency on the right is the counter currency. For example, when you place an order to buy EUR/USD pair, you are actually buying the EUR and you are selling the USD. When you place an order to sell EUR/USD you are selling the EUR and you are buying the USD. Buying or selling a currency PAIR means buying or selling the base currency, and doing the opposite with the counter currency.

It might seem a little confusing, but actually it is easier to treat the currency PAIR as one item. It means when you place trades you simply sell or buy the pair. The base/counter concept is only important for fundamental analysis.

To decide when to sell or buy you will need to learn technical analysis and/or fundamental analysis.

In currency trading you can make money both, when the currencies go up or down.

The FOREX currency trading is a great way to work from home in your free time. You can trade any time you want, from Monday to Friday. But you must know that you can lose money in FOREX. So, getting the proper education and trading before doing any real trades is a must. Fortunately you can first practice on a demo account, until you get to the point that you win 70% of your trades. Nobody wins 100%. But you can be in profit even with 50% wins.

A Short Explanation Of “Buying” and “Selling” In Forex Trading.

2010-02-16T18:30:00.001+02:00

These days everyone is talking about a new profitable activity called Forex trading and the great opportunity this activity represents for people willing to brake free from the corporate world and start working from home or any where else without losing their current lifestyle and even improving it.

Most experienced traders consider that the best and most profitable of the capital markets is the Forex market. For many years Forex trading was the sole domain of major banks, large financial institutions and countries central banks; for example the U.S. Federal Reserve Bank. But these days, thanks to the internet the market has been opened to everyone willing to learn the best techniques in forex trading and with the intention of making substantial profits as the institutions mentioned above that annually and consistently make pretty high profits from trading in the Foreign Exchange market.

You have many advantages when trading the forex markets, for example; you don't have to worry about fees you may have to pay to your broker; there are also none of the usual fees to which futures and equity traders are accustomed to pay always; no exchange or clearing fees, no NFA or SEC fees.

The forex market has five major currencies: US Dollar, Japanese Yen, British Pound, Euro and the Swiss Franc. It is due to their great popularity in world's commerce transactions and its high activity that these five currencies account for over 70% of North American trading. Of course there are other tradable currencies; they include the Canadian, Australian and New Zealand Dollars. These minor currencies account for 4% - 7% of the total market volume. Together, all this five majors and minors currencies constitute the backbone of the Forex market.

The concept of “Buying” in Forex refers to the acquisition of a particular currency pair to open a trade and “Selling short” refers to the selling of a particular currency to open a trade, i.e, just the opposite. When you Buy, you are expecting the price of the currency pair to increase with time, i.e., you buy cheap to sell high; which is easy to understand. In the case of Selling short, it looks a bit more complicated. Here the way to make money is to initially sell a currency pair that you think will lose value in a given period of time and then, once it happened, you will buy it back at the new price but now you can sell it at the previous greater price the currency had when you opened the trade, so you earn the difference in prices. It may seem kind of tricky when you are starting, but once you are in front of your trading station it will look much simpler.

Do You Have A Back Up Plan?

2010-02-12T17:36:00.001+02:00

I know a woman in her sixties. She worked for a company for a little more than a decade as an administration and office assistant for a staff of one hundred sales people, who loved her dearly. She always made sure all the faxes got to their desks; the stationery stock was full and each staff member had what he needed.

Beyond her job description, she was like a mother to all of them: making sure the toilets got cleaned, old food was removed from the fridge and decorating the entire floor which the department occupied. She worked hard and never complained. She was always smiling, friendly and polite.

She felt good about being a ‘mother’ to all the people who entered and left that department. She was comfortable with her position. No-one else could do the things she did. And she did them better than anyone else in the building.

One day, she went to work as usual. After doing her morning chores, she was invited to the office, where she was told her services were no longer needed. The company was undergoing certain cost-cutting measures in every department and unfortunately, her role would have to be sacrificed. She was then asked to leave the building as soon as possible. She was assured, however, that before having made the decision, every attempt had been made to find a position for her somewhere within the company.

She has financial obligations to fulfil and she still hasn’t saved enough for her retirement. She still has credit to pay off and she was saving for a trip overseas, something she never got around to doing in her younger years. She wanted to save up to establish a book-selling business. Suddenly, she would have to re-evaluate her plans. Losing a job and nearing retirement age, she will have to relinquish some of the things she had dreamt for herself.

I am sure you have heard hundreds of similar stories like these. Just five months before writing this article, I had already read about companies cutting costs by laying off jobs. Their main reason is to remain competitive, so they would not have to raise the prices they charge to their customers. Companies are outsourcing jobs overseas because the labour costs in other countries are relatively cheap compared to the local currency and sometimes because of significant skills or technological advantages. Other businesses lessen staff when sales drop and they can no longer sustain to pay the same number of people they have on their payroll. No organisation – not even a big, established business – is immune from the need to become leaner in an ever-increasingly competitive market environment.

In the past, most people believed the companies or the governments – whom they work for – could guarantee them a job for life. Nowadays, I think more and more people are becoming increasingly aware that expecting to have a job-for-life is unrealistic. It is a dire predicament to be working everyday, taking care of someone else’s business and realising that at the end of one’s career, years of service do not guarantee one’s well-being. Because of this, I believe that people are now looking to improve their chances of having enough funds to meet their needs and wants after retirement.

I think there is a dawning awareness that the ultimate responsibility for one’s own well-being lies within each individual. People are beginning to understand that their boss or the company they work for does not have an obligation nor the ability to ensure that they are taken care of when they finish working for them.

According to an article written by John Roskam*, based on a forthcoming Institute of Public Affairs (IPA) Backgrounder on self-employment and the self-reliant society, the trend to self-employment will speed up in coming decades. Five reasons explain this change:

1. Our societies will continue to develop knowledge-intensive and service industries.
2. Jobs of the future need more education; however, better educated workers might opt to work for themselves instead.
3. Older workers are more comfortable with being self-employed than the younger workers, which might indicate individuals would prefer to work for themselves as they grow older.
4. Individuals want more control and flexibility over their working arrangements and self-employment allows for this.
5. Individuals are more willing to assume responsibility for the decisions that affect their lives and their families.

In addition to this trend, more and more people are now seeking to gain greater control over their financial assets.

What we can all learn from this article is the idea that we do not have to rely on our employers to be there for us when we desperately need them to pay us our periodic paycheques at the end of our working days. There are alternatives and, while we still can, I believe we owe it to ourselves and our families to have a back-up plan and look at every single opportunity available. The question for you is this: Do you have a back-up plan?

Trading the FOREX, your most profitable investment opportunity?

2010-02-10T21:23:00.001+02:00

Forex stands for the Foreign Exchange market, or Forex (FX). The foreign exchange market (FOREX) is the largest financial market in the world, with a volume of over $1.5 trillion daily in the US alone; more than three times the total amount of the US Equity and Treasury markets combined.

Traditionally, investors only way to gain access to the foreign exchange market was through banks that transacted large amounts of currencies for commercial and investment uses. Now because of federal rule changes, Forex trading is no longer a monopoly of the banks and investment houses, that means you too can enter and profit from the largest financial market in existence.

Forex trading is an alternative to the unpredictable fluctuations and ups and downs of the other markets. Trading is about making money and the opportunities in this market are boundless, they far exceed the slim pickings in the other markets.

Today, foreign exchange market brokers are able to offer small traders like you and me the opportunity to buy or sell any number of smaller money lots with the option to trade them at the same rates and price movements as the big players who once dominated the market.

You can start with as little as US $ 300 in your account, and you would be surprised to find out that trading currencies is far less risky than any other kind of trading. And that is why before long all the other traders won’t fail to discover the FX market and the immense wealth creation possibilities it has to offer. This is your time to get in one of the biggest, and most exciting, opportunities that has come along in decades, and you can learn forex trading strategies easily, there is even a free course “Forex Freedom” you can grab and start on your way to Forex profits.

Still need more reasons to give the Forex trading your full attention?
There are many different advantages to trading forex instead of futures or stocks:

1.Lower margin

The margin requirements that are needed for trading futures are usually around 5% of the full value of the holding, or 50% of the total value of the stocks, the margin requirements for forex are about 1%. For example, the margin required to trade foreign exchange is $1000 for every $100,000. That means trading forex, your money can play with 5 times as much value of product as a futures trader’s, or 50 times more than a stock trader’s.
When you are trading on margin, this can be a very profitable but it’s important that you understand the risks that are involved as well. Here is where a great Forex trading course comes in to help and support you all the way to real profits.

2. No commission and no exchange fees

When you trade in futures, you have to pay exchange and brokerage fees. Trading forex has the advantage of being commission free, which is much better for you. Currency trading is a worldwide inter-bank market that allows buyers to find sellers in an instant.

3. Limited risk and guaranteed stops

When you are trading futures, your risk can be unlimited. For example, if the price for an item falls dramatically, you can’t leave your position and this could wipe out the entire equity in your account as a result. If the price keeps falling, you have to find more money to make up for the deficit in your account.

4. 24 hours marketplace

With futures, you are generally limited to trading only during the few hours that each market is open in any one day. Unlike other financial markets, the Forex market has no physical location, no central exchange. It operates through an electronic network of banks, corporations and individuals trading one currency for another. Forex market operates 24/5. You can trade any time you like from Monday to Friday.

5. Free marketplace

Foreign exchange is perhaps the largest market in the world about $ 1,9 trillion and with the huge number of people trading forex around the globe, it is very hard for even governments to control the price of their own currency, the prices are fair.

6.You Can make money in rising and falling markets

There are no restrictions to sell currencies short, which means that with forex currency trading you can make money just as easily in rising and falling markets.

Forex trading is simply a great alternative to futures and commodities trading. Unless you are a broker, you will likely want to get some help in forex trading to help ensure that you are successful with it. As with all trading, there are always some risks involved, but if you follow the tips and teachings of people who made the Forex easy to trade, there is nothing which can stand between you and substantial profits.

Now I ma sure you have some questions like:

Where do you start?
Who would teach you the great profitable strategies?
Who would mentor you so your risks are minimalized?
Who would explain to you the special Forex terminology and its nuts and bolts?
Who would show you how to trade the Forex for profits working just a few hours the week?

The easiest way to get started is to get the free course “Forex Freedom” and study it carefully. You will see and feel the advantages of such an investment over all other kind of investments and you know you can start with as little as $300.

Be A Forex Expert

2010-01-30T10:05:00.004+02:00

Any one who has ventured into the real market place would definitely have an idea what a Forex is and share the many promises and possibilities this horizon can bring.

What Is Forex?

FOREX stands for the very popular Foreign Exchange Market. Sometimes, though, people associate it or equate it to mean also currencies.

Basically, forex is where people trade. The objects of the trading are the different foreign currencies. People buy and sell the currencies.

The exchange market and the trading as we know it today started in the 1970’s. It has no definite place. It has no definite location. The foreign exchange market is found wherever there is a financial center where people conduct constant exchanges and buying and selling.

To ensure definite success in this field, the main goal has to be kept in mind. The keywords to traders in the foreign exchange market are to ‘buy low and sell high.’ This is the way to get the profits coming in.

Why Are People Trading in the Forex?

More and more people are turning into the forex trading now. It has become popular once again and people want to enjoy the success this can bring.

There are also no strict requirements to join the market. Anybody can enter it and learn how to trade. Some even study beforehand to be prepared for the big trading.

Another good aspect about forex is the absence of too many fees to be able to join in. There are no commissions, no brokerage fees and no government fees.

The best thing by far is that trading can be done at home. Anyone can initiate a trade online. This spells big for people who stay at home, especially those who do not feel comfortable in engaging on online businesses. With proper training and computer with internet access at hand, success is within the bounds of the home.

How Does One Trade Successfully in the Foreign Exchange Market?

The purpose of ‘to buy low and to sell high’ must be kept in mind when trading in the forex. This will be the main vision of a trader to succeed.

The next task at hand is to know the trends. This means knowing when a particular currency will buy low or sell high. This is not mere prediction of possible turn of events.

Thus, forex requires strategies that have been tested to make sure that a decision will be profitable. There are two basic strategies employed in forex that one can learn from tutorials or from the actual exposure to the market.

The first strategy is the technical analysis.

This provides that a particular price chain reflects all the necessary information regarding the market. This entails a close analysis of the various aspects of the currency like the lowest and highest prices or the opening and closing prices.

The other strategy is the fundamental analysis.

As the name implies, it takes the overall situation. It focuses beyond the currency. It takes into account the situation of the country, economy, politics and even the rumors. Thus this requires more exposure and knowledge from the part of the trader.

Conclusion

The foreign exchange market promises so many possibilities to the trader. Many people may be interested in the forex but are only afraid to take the first step. This attitude should be turned around. Just have a good vision, take the necessary steps and make the forex venture a success.

All Rights Reserved, This content may be reprinted as long as it remains unchanged and the links are intact and active.

Would You Like To Forex Or DayTrade?

2010-01-27T14:00:00.003+02:00

Online trading is great way for serious investors to make money, but inexperienced traders often wind up with big losses. A good set of instructions can minimize the risks and save months of expensive trial-and-error learning.

Day Trading

Day Trading had its heyday during the bull market of the 1990's. All the amateurs have since dropped out, but day trading is still being practiced by professionals. There are fewer opportunities in the current market, but skilled investors can still find them if they know what to look for.

FOREX Trading

The Foreign Exchange Market (FOREX), the world's largest financial exchange market, originated in 1973. It has a daily turnover of currency worth more than $1.2 trillion dollars.

Unlike many other securities, FOREX does not trade on a fixed exchange rate; instead, currencies are traded primarily between central banks, commercial banks, various non-banking international corporations, hedge funds, personal investors and not to forget, speculators. Previously, smaller investors were excluded from FOREX due to the huge amount of deposit involved. This was changed in 1995, and now smaller investors can trade alongside the multi-nationals. As a result, the number of traders within the FOREX market has grown rapidly, and many FOREX courses are appearing to help individual traders increase their skills.

As a matter of fact, it's advisable to take FOREX training even before opening a trading account.
It is vital to know the market mechanics of FOREX, leveraging in FOREX, rollovers and the analysis of the FOREX market. Due to this fact, potential FOREX traders would do well to either enroll in a FOREX training courses or even purchase some books regarding FOREX trading.

There are pros and cons to enrolling into a FOREX course. For beginners a FOREX course is a rapid method of learning the basics of FOREX trading. Not much time is spent on history of the market or arcane economic theories. Often, on-line or phone support from a skilled FOREX trader is available to answer any questions. Also, the information is condensed and practical, often with graphs and charts.

The disadvantage is the price, as courses are more expensive than a paperback from the bookstore. Also,
the course may just teach the approach of the trader who wrote it, and individuals have different trading strategies. The student may grow accustomed to the logic and focus of the teacher without coming to realise that nothing is predictable in the FOREX market, and many different strategies will bring profits in varying market circumstances. Also, knowledge of practical applications may not be enough, as the FOREX is highly unpredictable and there are many external factors, such as political issues, affecting the flow of finances in the market.

Forex

2010-01-26T21:40:00.003+02:00

Money. We all need it. We all want it. Trillions and trillions of dollars, pesos, euros, pounds, levs, francs, and more change hands every day for goods and services around the world. Most of us are only familiar with the money that is exchanged for goods and services in our own country and are only concerned with getting more of that.

But there is a lot more to money than that. What is the relationship between the currency in your country and the currency of some other country and why should it matter to me? I’m glad you asked. In this article we will explore some of the currencies around the world and answer some questions you may not even know you had.

First, if we are going to discuss currency and it’s relationship to other currency, we have to talk about Forex. That’s short for foreign exchange or the exchange of currency for a different type of currency.

There is no market in the world, including Wallstreet that can compare to Forex in volume of cash traded daily. Retailers, Governments, Currency Speculators, Banks, Corporations, and other financial institutions engage in forex or foreign currency exchange to the tune of trillions of dollars and other currency each day.

It is a truly amazing thing to see. People making money just by trading one country’s currency for another. Keeping up with the latest news in each country, economic trends and indicators, real-time monitoring of current currency values in comparison to another currency are all things required if you are going to speculate in this arena.

More than that, some forex speculators will tell you is, you have to have a good feel for it. You have to understand economies and be able to recognize the events and conditions that will cause people to lose confidence in one currency or another. You have to know when to hold em and when to fold em, as the Kenny Rogers song goes.

If you would like to check the exchange rates for each of these currencies against other currencies, you can open a new browser window and put this url into your address bar. It’s a Forex Calculator. http://uk.finance.yahoo.com/currency-converter?u

The following is a list of world currencies. It may not be every currency in the world, but it will give you an idea of the complexity of forex.

Albanian Lek, Algerian Dinar, Aluminium Ounces, Argentine Peso, Aruba Florin, Australian Dollar.

Bahamian Dollar, Bahraini Dinar, Bangladesh Taka, Barbados Dollar, Belarus Ruble, Belize Dollar, Bermuda Dollar, Bhutan Ngultrum, Bolivian Boliviano, Brazilian Real, British Pound, Brunei Dollar, Bulgarian Lev, Burundi Franc.

Cambodia Riel, Canadian Dollar, Cayman Islands Dollar, CFA Franc, Chilean Peso, Chinese Yuan, Colombian Peso, Comoros Franc, Copper Ounces, Costa Rica Colon, Croatian Kuna, Cuban Peso, Cyprus Pound, Czech Koruna.

Danish Krone, Dijibouti Franc, Dominican Peso. East Caribbean Dollar, Ecuador Sucre, Egyptian Pound, El Salvador Colon, Eritrea Nakfa, Estonian Kroon, Ethiopian Birr, Euro.

Falkland Islands Pound, Gambian Dalasi, Ghanian Cedi, Gibraltar Pound, Gold Ounces, Guatemala Quetzal, Guinea Franc, Haiti Gourde, Honduras Lempira, Hong Kong Dollar, Hungarian Forint, Iceland Krona, Indian Rupee, Indonesian Rupiah, Iran Rial, Israeli Shekel,

Jamaican Dollar, Japanese Yen, Jordanian Dinar, Kazakhstan Tenge, Kenyan Shilling, Korean Won, Kuwaiti Dinar, Lao Kip, Latvian Lat, Lebanese Pound, Lesotho Loti, Libyan Dinar, Lithuanian Lita.

Macau Pataca, Macedonian Denar, Malagasy Franc, Malawi Kwacha, Malaysian Ringgit, Maldives Rufiyaa, Maltese Lira, Mauritania Ougulya, Mauritius Rupee, Mexican Peso, Moldovan Leu, Mongolian Tugrik, Moroccan Dirham, Mozambique Metical.

Namibian Dollar, Nepalese Rupee, Neth Antilles Guilder, New Turkish Lira, New Zealand Dollar, Nicaragua Cordoba, Nigerian Naira, Norwegian Krone, Omani Rial.

Pacific Franc, Pakistani Rupee, Palladium Ounces, Panama Balboa, Papua New Guinea Kina, Paraguayan Guarani, Peruvian Nuevo Sol, Philippine Peso, Platinum Ounces, Polish Zloty, Qatar Rial, Romanian Leu, Romanian New Leu, Russian Rouble, Rwanda Franc.

Samoa Tala, Sao Tome Dobra, Saudi Arabian Riyal, Seychelles Rupee, Sierra Leone Leone, Silver Ounces, Singapore Dollar, Slovak Koruna, Slovenian Tolar, Somali Shilling, South African Rand, Sri Lanka Rupee, St Helena Pound, Sudanese Dinar, Surinam Guilder, Swaziland Lilageni, Swedish Krona, Swiss Franc, Syrian Pound.

Taiwan Dollar, Tanzanian Shilling, Thai Baht, Tonga Pa'anga, Trinidad&Tobago Dollar, Tunisian Dinar, U.S. Dollar, UAE Dirham, Ugandan Shilling, Ukraine Hryvnia, Uruguayan New Peso, Vanuatu Vatu, Venezuelan Bolivar, Vietnam Dong, Yemen Riyal, Zambian Kwacha, Zimbabwe Dollar.

Can you imagine sorting out all of the relationships between each of those currencies and precious metals. Forex is not for the faint of heart it would seem, but it does make a facinating topic. In some of the currency names you can see how it relates to world history.

I hope you find this article has helped you with at least an explanation of what Forex is and how it works. There is a lot more out there about Forex. Learn more!

Big profits from Currency Trading

2010-01-23T16:47:00.002+02:00

If you want to make big profits from currency trading, you need to lock into and follow the longer-term trends.

“The art of contrary” thinking is one of the most powerful tools a trader can use, and is a trait with which all true great traders are familiar with.

What is the Art of Contrary Thinking?

Humphrey Neill’s book, "the art of contrary thinking,” the best known work on the subject, is based on a simple powerful idea that:

"When everybody thinks alike, everybody is likely to be wrong"

“The art of contrary” thinking consists in training your mind to ruminate in directions opposite to general public opinions; but basing your opinion in the light of current events and human behavior”.

Why Contrary Trading Works

By spotting situations when the consensus of a currency is either extremely bullish or bearish, means that a trend change is imminent, as it is likely the emotions of greed and fear have pushed prices too far away from true value.

If you can step aside from the crowd and take a contrary view at these turning points, you can make big currency trading profits. Contrary thinking can be used in any market and is highly effective in currencies.

Contrary thinking can be used to make really big currency trading profits and if used selectively, when markets are extremely over bought or oversold, you can be in right at the start of the trend for maximum profitability.

In any currency you look at - The Yen, Euro, British Pound Swiss Franc Canadian or Australian dollar and many others, there are always occasions where a currency trend in the news is forecast to continue, due to overwhelming evidence in its favor and it then promptly collapses!

Big profits from currency trading can therefore be made by using the art of contrary thinking when the market is extremely bullish or bearish.

Why? Because everyone who has bought has taken positions and there are no buyers left. Prices have moved away from fair value. When there is no more buying to enter the market, a trend change is imminent.

It is clear that to succeed and make big profits in currency trading you need to think independently of the majority at important market turning points.

You can make big profits in currency trading from trend following, but you can with a little practice spot potential turning points in currencies as well which will help you bank profits, tighten stops or open new trades right on the turn, for maximum profitability.

Contrary trading will not only make you big profits in currency trading but in ANY market and has worked for centuries, as human nature never changes.

FOREX: Exiting positions at a right time

2010-01-22T18:15:00.002+02:00

The presented article covers one of the most important (in author’s opinion) aspects of trading in general and FOREX trading in particular – managing of orders and positions. This includes choosing entry points, making decisions about exit points, stop-loss and take-profit of the trader. I hope this article will help new traders, who just began to work with FOREX, and also to experienced traders who trade regularly and regularly make or loose their money to the market.

When I started to trade FOREX and made my first big losses and profits I began to notice when very important thing about the whole trading process. While the right time to enter a position was rarely a problem for myself (nearly 80% of all my open positions had gone into the “green” profit zone), the problem was hidden in the determining the right exit point for that position. Not only was it important to cut my risk on the potential losses with stop-loss orders, but to limit my greediness and take profit when I can take it and make it as high as I can. There are many known guidelines and ways to enter a right position at a right time – like major economic news releases, global world events, technical indicators combinations, etc. But while the entering into a position is optional and trade can decide to miss as many good/bad entry point moments as they wish, this is untrue if we talk about exiting a position. Margin trading makes it impossible to wait too long with an open position. More than that, every open position in a certain way limits trader’s ability to trade.

Choosing the good exit points for positions could be an easy task if only the FOREX market wasn’t so chaotic and volatile. In my opinion (backed by my trading experience) exit orders for every position should be toggled constantly with time and as the new market data (technical and fundamental) appear.

Let’s say, you took a short position on EUR/USD at 1.2563, at the time you are taking this position the support/resistance level is 1.2500/1.2620. You set your stop-loss order to 1.2625 and your take-profit order to 1.2505. So now, this position can be considered as an intraday or 2-3 days term position. This means that you must close it before it’s “term” is over, or it will become a very unpredictable position (because market will differ greatly from what it was at the time you have entered this position). After the position is taken and initial exit orders are set, you need to follow the market events and technical indicators to adjust your exit orders. The most important rule is to tighten the loss/profit limit as time goes by. Usually if I take a middle term position (2-4 days) I try to lower the stop and target order by 10-25 pips every day. I also monitor global events, trying to lower my stop-losses when very important news can hurt my position. If the profit is already quite high, I try to move my stop-loss the entry point, making a sure-win position. The main idea here is to find an equilibrium point between greed and caution. But as your position gets older the profit should be more limited and losses cut. Also, trader should always remember that if the market began to act unexpectedly, they need to be even more cautious with exit order, even if the position is still showing profits.

Every trader has their own trading strategy and habits. I hope this article will make its readers think about such an important aspect of trading as the exit orders and this will only improve their trading results.

Avoiding Forex-Related Frauds and Scams

2010-01-07T11:51:00.003+02:00

A lot of people have been ‘burnt' from scam operations on the Internet. Their sites may look so perfectly legitimate that you doubt whether they would have gone through all that trouble building a trading platform just to steal your money. Beware.

The first thing I look for is the geographical location of the broker. If I find that they are based in a country where the financial industry is, in my opinion, relatively unregulated and under-developed, I quickly forgo signing up. This is terrible news for honest brokers in those countries, but your job as a trader is to protect your capital. If you lose that, then you cannot trade. The onus is on them to convince you that they will do the right thing by you as an investor.

I started out with an Australian broker. Currently I am using an American one. I have not tried UK-based brokers but the British financial industry is one of the best. Companies that are based in countries such as Japan , Germany and France are probably just as good too, if their website speaks your language.
Notice any license numbers that they may have registered with regulatory bodies that act like government watchdogs who oversee the finance and investments industries. These are organisations that impose strict rules to safeguard your investment. Some of these rules may include the requirement that brokers segregate all customer funds from the operational funds of the business. Your money is required to be put in highly-reputable banks and the funds are only withdrawn from these accounts upon specific withdrawal requests.

Take note that there are some fake regulatory bodies being thrown around in cyber-space as well. Take a look at how long they have been operating for. Try and search out any reviews or comments made about them. See if you can find forums where traders have discussions about their brokers.

Below is a list of things to keep in mind to help you avoid being a victim of a scam:
• Stay Away From Opportunities That Sound Too Good To Be True

There are people who may have just acquired a large amount of money just and recently are the same and are shopping around for safe investment vehicles. These may include retirees who have access to their retirement funds. It is understandable why retirees would be drawn to ‘high-return, low-risk investments'. This is also what makes them very vulnerable. If you identify yourself to be one of these people, be careful. A lot of deceitful characters are after your money. Furthermore, only allocate a tiny amount of your money to trading until you can start growing it. Not all people can trade successfully, so it is a venture you should take on haphazardly. It is your life savings at risk.

• Avoid Individuals Or Organizations Who Claim To Predict Or Guarantee Large Profits

Any form of trading is hard. Trading currencies is no different. Be wary of statements that make it sound easy. Statements like:

• “Whether the market moves up or down, in the currency market you will make a profit”;
• “Make $1000 per week, every week”;

• “We are out-performing 90% of domestic investments”;
• “You'll make returns of 70% a year”;

• “Here is a no-risk strategy”.
If they could make such returns, why would they even bother letting you know about it.

• Be Wary Of Companies Who Downplay Investment Risks

Hold your wallet tight and zip up your purse when companies say that written risk disclosure agreements are routine formalities imposed by the government. Watch out for statements like:

• “With a $10,000 deposit, the maximum you can lose is $200 to $250 per day”;
• “ We promise to recover any losses you have ”.

• Be Wary Of Companies That Claim To Trade In The ‘Interbank Market'

Do not believe it when some people say that they have access to the ‘Interbank market' or that they can give you access to trade in that market because that's where bargain prices can be obtained. This is not true. The ‘interbank market' is not a place, it is not a physical building. It is simply a loose network of currency transactions that are negotiated between big financial institutions and other large companies.

• Ethnic Minorities Are Often Targeted

Ethnic newspapers and television ‘infomercials' are sometimes used to attract Russian, Chinese and Indian minorities. Sometimes these ads offer so-called ‘job opportunities for account executives to trade foreign currencies', whereby the recruited ‘account executive' is expected to use his own money to trade currencies and would often times be encouraged to recruit members like their friends and family to do the same.

• Seek Out The Company's Background

Check any information you receive to be sure that the company is who they claim to be. If at all possible, try and get the background of the people operating the company. Do not rely solely on oral statements and promises made by the company's employees.

• If You Are In Doubt, It Is Not Worth Risking Your Money

If after trying to solicit information and at the end of it all, you are still in doubt about the credentials of a particular company, my suggestion is to start looking elsewhere.

You may find further information by contacting government ‘watchdogs' because they keep up to date with trends and reports regarding scams and other fraudulent activities. Please check the resource section of this site for the information of organizations that regulate the securities industry, sorted by country.

Believing these Six Myths will Slash Your Currency Trading Profits

2009-12-23T21:18:00.001+02:00

Below you will find the six common beliefs followed by the bulk of traders - and if you believe these myths as well, then they will restrict your chances of making significant currency trading profits.

Ninety percent of currency traders believe at least one or more of these myths - which explains why ninety percent of traders don’t make much profit by trading currencies!

1. You should always be in the Market in Case you Miss a Move

Traders love excitement, and their view is, if they are in the market they may catch the big move. Well they may - but chances are they won’t.

The big trends only come a few times a year in each currency - and you should stay out the market until they come, otherwise you will take losses, and run up commissions that will deplete your account.

Wait for the big trades - patience is a virtue in trading.

2. Diversification Reduces Risk, and Increases Profit Potential

Diversification simply dilutes your profits.

You hit a big move, and your other trades that lose, or give you only marginal profits, eat up all your currency-trading profits.

You need to have confidence to go for the big moves, when they occur, and load up these trades.

Currency trading is about calculated risks - if the trade looks good, hit it hard for big profits.

3. Day Trading is Better than Long Term Trend Following, as it’s Less Risky.

Many brokers spread this myth - and why not? - They make more commission if you believe it!

You will end up having more losses than profits in your trading. You will never make enough money in a day to cover your inevitable losses. When you add in commission and slippage, it’s inevitable that you will lose.

You need to hold longer-term trends, as these yield the big profits to cover your smaller losses.

4. Timing the Market is the Correct Way to Make Profits

Timing the market means you are trying to PREDICT where prices are going to top and bottom - this is not a good way to trade and the odds are against you.

A better way to trade is to wait for the market to CONFIRM a trend is under way, and jump on board. You may not buy the bottom or sell the high, but you can catch the major chunk in between - and with currency trends lasting for many months or years, you can still get plenty of profits from the trend.

5. Markets are the Same Today as they Were Hundreds of Years Ago

Rubbish! Trends now are much more volatile than they were even 50 years ago. Why? Today, with the Internet, price information reaches every corner of the globe in a split second. This increases volatility as everyone has the same information at once - and everyone tries to enter the market at the same time.

This was not the case even 50 years ago - the trends are still there, but volatility is much higher - traders get the direction of the trend right, but they find themselves stopped out by the volatility. How often has this happened to you? - It happens to all traders. Look at using options to give you staying power.

6. You can use a Black Box System to Make Money

You can buy a system from a vendor for a few thousand dollars - and it can make 50 to 100% profit per annum.

These systems normally have a hypothetical track record - and use price information where the results are already known, and of course, the logic of the system remains hidden from you - as it’s unlikely to have a sound basis.

Have you ever wondered why these vendors sell systems, when they could simply get a bank loan and trade their own systems?

Enough said on this one!

How about some Positive Advice?

If you want to make big currency trading profits, you need to do it for yourself.

Get a plan you have confidence in, and execute the plan with discipline - and have the courage to trade for large gains when they occur.

Good luck!

FOREX Currency Systems – Four Tips to Pick a System that Makes Money

2009-12-16T22:34:00.000+02:00

With the many FOREX currency systems available, you can in theory, simply turn your computer on and follow the signals to generate automatic profits.

That’s the theory - but the fact is, there are many FOREX currency systems sold that are obvious scams, and the systems will never work.

This article aims to give you tips on picking systems that can make money, and avoid the scams.

There are two main reasons why most FOREX currency trading systems fail to live up to their Hype:

1. Black Box Systems

These are systems where the logic is not revealed to the buyer - and for a FOREX currency trading system to be used successfully, the trader must have confidence in it.

If you don’t know the logic of the system, you will not have the confidence to follow it when a losing period occurs.

You need to follow a system rigidly to make money - otherwise you may as well not have a system in the first place.

Using a FOREX Currency trading system is all about having the discipline to follow the system - and if you don’t have confidence in the logic, you will never do this.

2. Curve Fitting and Optimization

Another indication of a currency trading system that is a scam, is one that involves curve fitting, or optimization.

These systems give a fantastic performance in back testing - because of the tweaking of the system rules, to make them fit the data, and produce profits.

A trader once likened this to shooting holes in a barn door, and then drawing circles around every hole - to make each shot look like a bull’s-eye.

Let’s face it, we would all be millionaires, if we had tomorrow’s news today - but we don’t.

Avoid any system that offers unique rules, or many variations for trading different markets.

If the system is based on solid logic - it should work on ANY trending market, and should not be optimized, or curve fitted to an individual market.

You will never see a hypothetical performance that fails!

Most unscrupulous vendors achieve great performance by making the system fit the data - and this causes the system to fail in real time trading.

Here are four tips, to help you separate out the scams, from the good FOREX currency-trading systems:

1. The Rules and Logic are Fully Explained

You will then have confidence in the system when it suffers a string of consecutive losses.

2. Some Evidence of a Real Time Track Record

Has the system has made money in the real world of trading?

This is the acid test of a system. If there is not a real record, look for a hypothetical audit done in real time - many systems do this before launching, and this gives a good indication of how the system will perform.

3. Look for Simple Systems

There is absolutely no correlation between how complicated a system is, and its profit potential. In fact, simple systems tend to work best, and will tend to be more robust in the brutal world of trading.

Most of the top FOREX currencies trading systems are based on simple logic.

4. Avoid any Optimized System

As already mentioned, if the system has sound principles, and then it should work on a broad spectrum of financial instruments - avoid any system that optimizes individual markets.

Not all FOREX currency trading systems fail - but if you want to get one that works, be realistic and do your homework first.

An Overview Of Forex Trading

2009-12-12T21:04:00.002+02:00

Forex, is an exchange that allows investors to trade national currencies through the foreign exchange. This is the worlds largest market for currency, based on the Dollar, anywhere between 1 – 2 TRILLION dollars are traded upon this market on a daily basis. This type of trade is typically performed online or on the telephone. By taking advantage of the world wide web, you are enabling yourself to make your investments in a reliable, easy, safe and fast way.

Some investors are able to enjoy returns of around thirty percent on a monthly basis, this takes a great deal of experience to gain this type of enormous return on your investment. The Forex market does not have one specific place of trade like many of the other markets do, for this reason alone is why most of the trade is performed by internet, fax, or telephone. In the beginning for currency trade was not all that popular, they were bringing in only about seventy billion dollars on a daily basis, with the invention of Forex, that number grew massively.

Of course, the currencies do not only deal with the American dollar, these currencies can be translated to over 5,000 currency institutions world wide, which include, commercial companies, large brokers, international banks, and government banks. Many major countries have forex trading centers such as, Frankfurt, London, New York, Paris, Hong Kong, Tokyo, and Bombay to name a few.

When trading online there are many benefits such as, the ability to trade or track your investments at anytime day or night, from anywhere within the world that offers an internet connection. Another added benefit, is that some online exchange sites allow you to start with a small investment, known as a mini account, some with as little as two-hundred dollars. With online trading, the trade is instant. When you trade offline you have to deal with paperwork, with online trading there is no paper work involved.

The world of the internet, has allow us to do many things with just a click of a button, where else can you bank, trade, talk to your family and friends, research your investments and earn money all at the same time? Make the internet work in your best interest by implementing online trading into your portfolio. There’s a whole world of money waiting for you to earn with your online investments, and it’s all available at the click of your mouse button.

Electronic Currency Exchange: Trading Digots for a profitable living

2009-12-10T20:40:00.002+02:00

First of all, if you're just finding out about electronic currency exchange trading, then probably you're still asking "what in the world does this electronic currency business is", and most importantly, "how do I make money from it?" Well, you are reading this at the right time, because electronic currency exchange is a business that is expanding and offering new ways to profit from it. This means that in the next months learning how to trade digots will prove to be more profitable than it is today. But what does "digot" mean? Digot is the value of a given currency when using the electronic currency exchange system. So if your account is in dollars, then a digot will stand for a dollar. If you are reading this, it means you are interested in making more money, and I must congratulate you, because electronic currency exchange is a fantastic vehicle to make money without much work required. This is why some people call this opportunity the anti-business. If you like the old saying "the less you work, the more you make" then you will love the electronic currency exchange business. Let me explain how it works: You get started with whatever amount of money seems reasonable to you. I got started with $200, but I've heard of people getting started trading digots with amounts ranging from $50 to $10,000 so it's entirely up to you and what you can afford. Keep in mind that the more you start with, the faster you will see profits, so it may be worth not buying that new PC to put in as much as you can from the start. After you have the electronic currencies set up, every 24 hour period you will generate from 2 to 4 percent of your investment. What makes this system so profitable, is that you have the option of reinvesting your profits, so that you gain interest of what you gained interests the day before AKA "Compounded interest" over your digots. It's very easy to see how your money can have the snowball effect and turn into a truly automatic cash machine. When I was looking to get started, I started with an online course, so I had no learning curve. This is the path I recommend, but if you are short of money, you can also exchange your time and efforts and research online for how to trade ecurrencies.

Accepting Losses With Grace

2009-12-08T22:22:00.003+02:00

The lack of a proper trading plan which includes precise rules for entering and exiting a trade will most certainly guarantee failure over the long term. Beginners usually suffer from the same common ailments. They abandon trading plans purely on impulse because things are not going exactly as how they had envisioned. Repeatedly they use unreliable methods that fail to produce a profit. Many traders hold on to losing positions telling themselves “it is going to turn” when every indicator says otherwise because they cannot bear the thought of a loss.

Why do they torture themselves? Why don’t they just identify what’s going wrong and make a change? For some people recognizing that a trade or even a trading method is not working and making a change is easy, but for others it’s very difficult. They have to look at their limitations admit that they have made a mistake and that’s hard because it hurts our ego. Psychologically it’s risky, it’s often easier to fool ourselves. Just keep going, living in a state of denial until your account is depleted. If you recognize any of these traits in yourself you must stop trading immediately.

Take a good look at what has been happening, try and identify the problem. If you look close enough you may see a pattern. This is why it is vital to record every trade and as much information about it as possible. You have to break out of old patterns and see things in a new light.

You will never be a successful trader if you continue to live in a state of denial. What can be done to return to reality? There is a lot you can do. First of all make sure you are not trading under stress. When stressed out you can’t see clearly, you become rigid and unable to see alternative views. One of the easiest solutions is to trade smaller. The smaller the trade the less the stress, especially for the beginner. If you are experienced and in a loosing streak reduce your contracts until you get your confidence returns. Some people need to take a break altogether. Get away from it all. Take your mind off the trading.

The second thing you can do is to make sure you have a life. Trading can be addictive especially when you are winning. Do not put all your emotional eggs in the trading basket. You need to have other roles that give your life meaning and purpose. By defining your identity in a variety of ways, you will not place un-natural importance on trading events. Therefore, you will be able to take losses in stride and look at your trading more objectively.

Finally, radical acceptance is a key mental strategy for coping with market uncertainty. Many traders make the mistake of thinking they can control the markets. Nobody can control the markets. We must learn to accept anything that comes our way and to trade accordingly. Adopt the attitude that trading is a journey and that all we can do is go where the markets take us.

To succeed on this journey you cannot afford to lose too much. Manage risk and just accept what you get and enjoy the ride. This way you will trade more freely and creatively. Don’t live your life in denial. Accept your limitations, work around them, and become a winning trader. Write out your trading plan with precise entry and exit points. Most important set your stops and mentally decide you will not break them. Test your system on paper and when confident test in real time with the minimum contract size. You will have losing trades, accept them with grace and go on to the next trade.

Forex Profits by buying and selling at the same time?

2009-12-06T21:52:00.002+02:00

This article is one of a series which looks at the advantages and weaknesses of trading using the hedged, grid trading system to trade volatile markets.

We will look at how money can be made by breaking a number of trading truths or principles; * cut your losses and let your profit run and * there is nothing to gained by entering into buy and sell deals at the same time.

The hedged grid trading system uses the principle that one should be able to cash in at a gain no matter which way the market moves. No stops are therefore required at all. The only way this is logically possible is that one would have a buy and sell active at the same time. Most traders will say that that is trading suicide but let’s take some to look at this more closely.

Let’s say that a trader enters the market with a buy and sell active when a currency is at a level of say 100. The price then moves to 200. The buy will then be positive by 100 and the sell will be negative by 100. At this point we start breaking trading rules. We cash in our positive buy and the gain of 100 goes to our account. The sell is now carrying a loss of -100.

The grid system requires one to make sure that cash in on any movement in the market. To do this one would again enter into a buy and a sell transaction. Now, for convenience, let’s assume that the price moves back to level 100.

The second sell has now gone positive by 100 and the second buy is carrying a loss of -100. According to the rules one would cash the sell in and another 100 will be added to your account. That brings the total cashed in at this point to 200.

Now the first sell that remained active has moved from level 200 where it was -100 to level 100 where it is now breaking even.

The 4 transactions added together now magically show a gain:- 1st buy cashed in +100, 2nd sell cashed in +100, 1st sell now breaking even and the 2nd buy is -100. This gives an overall a gain of 100 in total. We can liquidate all the transactions and have some champagne.

There are many, many other market movements that turn this strange “buy and sell at the same time” activity into gains. These will be covered in future articles and are covered in a free grid trading course which is available at the expert-4x.com website for those traders whose curiosity has been aroused.

There will be more on the hedged grid trading articles to be issued regularly. Please watch this site.

Yes, You Can Start Trading Forex For Free!

2009-12-05T16:19:00.003+02:00

Yes, it’s true, you can trade the forex markets for free and using
the same state-of-the-art software packages that professional Forex traders, around the world, are currently using to make real-time, live currency trades.

And you can also experience the same dynamic market action and go through the same process of making decisions based on breaking news, reacting to charting patterns, and tracking ones performance the same way professional Forex traders do.

And all this can be done even if you don't put any real money into your account, you won’t see any difference in how the market behaves and how you react to the market. In short, at some point, every new forex trader needs to start Demo-trading.

Once you start placing demo trades, you will learn a lot about how Forex transactions are placed. I can’t emphasize you enough, that this is a very important step for you in order to be able to learn how to become a trader. A demo account allows one to become familiar with trading procedures, such as placing Market, Limit, Stop, OCO Orders without any risk. All dollar losses or gains on a demo account are imaginary but, as mentioned above, the trading experience you acquire is not.

You should notice that making big gains in a demo-account does not guarantee profits in live trading; however, those who are not successful trading on paper rarely are successful when money is on the line. So, yes, just playing around and getting familiar with a demo account can be a great learning experience; however, you will not learn how to become a trader this way. You need to have a trading strategy.

Once you sign up for a mini-demo account, you will need to try one of the trial charting packages from the broker you choose. Any demo software you choose will do because they all have the necessary indicator tools you need. Once you have downloaded the software you can then set up your demo account and start drawing trendlines, marking support & resistance levels, monitoring moving averages, etc. This is also a very good way to get used to how orders are placed. Once you have a real trading system, you will already know how to place orders properly.

And remember, everyone makes mistakes placing orders. So you need to experiment before in a demo account so you can make your mistakes without losing any real money.

Forex And Commodities Futures And Options. What To Know Before You Trade.

2009-12-04T18:11:00.001+02:00

The popularity of trading futures and options has been growly rapidly for several years. The ease of accessing constantly updated data online has prompted an increased fever by day traders to attempt to be successful and make money in this risky investment area. Individuals can now trade these markets with the same ease and speed as large companies.

Trading forex ( foreign exchange ) and commodity futures and options is not for everyone. It is a complex and risky business that experiences volatile price and value swings. Before you invest any money in forex, commodities futures or option contracts, you should:

• Consider your financial trading experience, goals, and financial resources and know how much you can afford to lose above and beyond your initial payment.

• Understand commodity futures and option contracts and your obligations before commiting your finances into trade contracts.

• Understand your risk exposure and aspects of trading by thoroughly reviewing the risk disclosure documents your broker is required to give you.

• Know who to contact if you have a problem or question.

• Ask more questions and gather more information before you open an account.

Commodity futures and option contracts:

A futures contract is a legally binding agreement between two parties to buy or sell a specific financial product or commodity in the future, on a designated exchange, for a specific quantity of a commodity at a specific price. The buyer and seller of a futures contract will agree now on a price for a product to be delivered, or paid, for at a specifically set date and time in the future, which is known as the "settlement date." Actual delivery of the commodity can take place in fulfillment of the contract, but most futures contracts are actually closed out or "offset" prior to delivery.

An option on a commodity futures contract is a legally binding agreement between two parties that gives the buyer, who pays a market determined price known as a "premium," the right (but not the obligation), within a specific time period, to exercise his option. Exercise of the option will result in the person being deemed to have entered into a futures contract at a specified price known as the "strike price." In some cases, an option may confer the right to buy or sell the underlying asset directly, and these options are known as options on the physical asset.

In the United States, an individual, cannot trade futures contracts and options on futures contracts directly on an exchange. A person or firm must trade on your behalf. People and firms who trade on your behalf as a customer generally must be registered with the Commodity Futures Trading Commission.

Two general categories of trading accounts:

• Individual Account. In an individual account, trading is done only for you. An individual account may be setup as either a "non-discretionary" or a "discretionary" account. A "non-discretionary" account, means that you will make all of the trading decisions and the broker may not execute any transactions without your prior approval and consent. A "discretionary" individual account, means that you give permission to the broker firm carrying your account or some third party to make trading decisions on your behalf.

You may open an individual account with a registered Futures Commission Merchant or through an Introducing Broker. An Introducing Broker may accept your orders and transmit them for execution to a Futures Commission Merchant with which the Introducing Broker has a relationship. You deposit funds directly with the Futures Commission Merchant. In an individual discretionary account, you grant power-of-attorney to a Futures Commission Merchant, an Introducing Broker, one of their Associated Persons, or a Commodity Trading Advisor to make trading decisions on your behalf.

Commodity Pool. You may also trade commodities through a "commodity pool." This means you are purchasing a share or interest in the pool, and trades are executed for the pool as a whole, rather than for the individuals who have interests in the pool. Pool participants share in any gains or losses.

If you have a dispute or a problem arises out of your commodity futures or option account, first try to resolve the problem with your broker. If that is not successful, then you have options for resolving disputes: (1) the CFTC Reparations program; (2) industry sponsored arbitration; or (3) court litigation. In selecting a particular approach, you may want to consider the cost, length of time involved and whether or not the assistance of an attorney is required. More information on dispute resolution is available from the CFTC's Office of Proceedings (202-418-5250).

A Checklist "Before You Trade":

Make sure you have:

• Clearly identified your financial goals, including the amount of risk and loss you can handle?
• Determined how much assistance and help you may want from a trading advisor in making trading decisions?
• Checked the registration status and disciplinary history of the advisor or pool you select with the National Futures Association?
• Received and thoroughly reviewed the disclosure document -- before you open an account?
• Clearly understood the disclosure document, including the statement of fees, the potential for loss, your right to withdraw your funds and the "break-even analysis?"

Make sure you ask questions for anything that you do not understand. Remember, it is your money, make sure you know where it is going.

“How To” Start Trading The Forex Market?

2009-12-03T21:44:00.001+02:00

What Is FOREX or FOREX MARKET? PART I

The Foreign Exchange market (also referred to as the Forex or FX market) is the largest financial market in the world, with over $1.5 trillion changing hands every day.

That is larger than all US equity and Treasury markets combined!

Unlike other financial markets that operate at a centralized location (i.e. stock exchange), the worldwide Forex market has no central location. It is a global electronic network of banks, financial institutions and individual traders, all involved in the buying and selling of national currencies. Another major feature of the Forex market is that it operates 24 hours a day, corresponding to the opening and closing of financial centers in countries all across the world, starting each day in Sydney, then Tokyo, London and New York. At any time, in any location, there are buyers and sellers, making the Forex market the most liquid market in the world.

Traditionally, access to the Forex market has been made available only to banks and other large financial institutions. With advances in technology over the years, however, the Forex market is now available to everybody, from banks to money managers to individual traders trading retail accounts. The time to get involved in this exciting, global market has never been better than now. Open an account and become an active player in the largest market on the planet.

The Forex Market is very different than trading currencies on the futures market, and a lot easier, than trading stocks or commodities.

Whether you are aware of it or not, you already play a role in the Forex market. The simple fact that you have money in your pocket makes you an investor in currency, particularly in the US Dollar. By holding US Dollars, you have elected not to hold the currencies of other nations. Your purchases of stocks, bonds or other investments, along with money deposited in your bank account, represent investments that rely heavily on the integrity of the value of their denominated currency ¨the US Dollar. Due to the changing value of the US Dollar and the resulting fluctuations in exchange rates, your investments may change in value, affecting your overall financial status. With this in mind, it should be no surprise that many investors have taken advantage of the fluctuation in Exchange Rates, using the volatility of the Foreign Exchange market as a way to increase their capital.

Example: suppose you had $1000 and bought Euros when the exchange rate was 1.50 Euros to the dollar. You would then have 1500 Euros. If the value of Euros against the US dollar increased then you would sell (exchange) your Euros for dollars and have more dollars than you started with.

Example:

You might see the following:

EUR/USD last trade 1.5000 means
One Euro is worth $1.50 US dollars.

The first currency (in this example, the EURO) is referred to as the base currency and the second (/USD) as the counter or quote currency.

The FOREX plays a vital role in the world economy and there will always be a tremendous need for the exchange of currencies. International trade increases as technology and communication increases. As long as there is international trade, there will be a FOREX market. The FX market has to exist so a country like Germany can sell products in the United States and be able to receive Euros in exchange for US Dollar.

RISK WARNING:

Risks of currency trading

Margined currency trading is an extremely risky form of investment and is only suitable for individuals and institutions capable of handling the potential losses it entails. An account with an broker allows you to trade foreign currencies on a highly leveraged basis (up to about 400 times your account equity).The funds in an account that is trading at maximum leverage may be completely lost if the position(s) held in the account experiences even a one percent swing in value. Given the possibility of losing one's entire investment, speculation in the foreign exchange market should only be conducted with risk capital funds that, if lost, will not significantly affect the investors financial well-being.

Forex : How To Handle A String Of Investment Losses

2009-12-01T22:25:00.002+02:00

Everybody hates to lose and unfortunately no one is blessed with the ability of foresight, therefore losses are an unavoidable part of trading. When we enter a trade we will either be right, or wrong, and even if we broke-even we'd still be classed as being wrong - as nobody enters into a trade just to break-even! When unsuccessful traders encounter a string of losses they begin to engage in self-destructive patterns that help them escape the pain they are experiencing.

Bring to light these self-destructive actions that can help you realize what you are doing before it takes hold of your physical health. If you find yourself already engaged in these patterns hopefully this article can help you to get you back on track as quickly as possible.

What are the destructive patterns?

If you find yourself caught in a string of losses or a bad performing week/month be sure to monitor your behavior. It is during this time that you will be at your most vulnerable. You will begin to indulge in activities that at first seem harmless, but upon excessive use (or in time), begin to cause physical damage to your health.

Ask yourself the following question: during drawdown periods do I find myself over-indulging in these activities:

Food (especially junk food - e.g. chocolate, ice-cream, chips)?

Sex (includes viewing pornography)?

Alcohol?

Drugs (includes excessive smoking)?

Laziness (find it difficult to wake up in the morning)?

Entertainment?

All of the above taken in excessive doses can be detrimental to your own physical health (some even in small doses!).

These activities above during your losing period are only covering up the pain of confronting the true issue, and your body tries to rid the emotional pain by trying to "fix" it with physical pleasures. Unfortunately it is going about it in the wrong way, so what should you do?

Firstly... REALIZE WHAT YOU ARE DOING AND STOP IT!

You need to realize what you're doing and you need to STOP doing it immediately! You can either decide to stop, or you'll be forced to stop when your body eventually breaks down and prevents you from any form of movement. It will be much more beneficial to you in the long-term if you can decide to stop *NOW*.

Once you have stopped you now need to figure out a way to solve the pain - not by cutting out or neglecting it, but by staring it in the face. Bring your problems out into the light, be honest with yourself. There can be no growth without pain; you are experiencing the emotional pain, now it is time to find the error and therefore your growth.

Begin Your Review

The review process begins in two separate areas: You & Your System. Here are some checklists for you to go through to find out where the problem could lie:

"YOUR SYSTEM" CHECKLIST

Was your system thoroughly tested prior to trading it (or paper traded if you do not have the capacity to program your system into back testing software)?

Did you test with out-of-sample data?

Do you even have a system???? If you do not, how do you even know if the method that you are trading is even profitable??

Is your system's code correct?

Did you over-optimize your system? (What have we discussed about over-indulging?)

Did you paper trade your system prior to placing capital on it?

Did you trade with a small amount of capital prior to placing the rest of your funds on it?

Do you know the system's limitations?

Did you properly drill your system? (See our blog article on why I am the system designer from hell)

"YOU" CHECKLIST

Is the current drawdown you are exhibiting with your system normal?

Are you comfortable with your system's historical drawdown performance?

Are you fully aware of the risks involved with your system and the instrument(s) you are trading?

Are you trading with funds that you are comfortable risking?

Are you relying too heavily on your performance?

Have you set realistic goals?

As you can see there are generally two areas that you need to explore: the mechanical aspect - your system - and the emotional aspect - you. Both can be responsible for making the way you feel the way you do. It will either be an error on the system's side with how the system was tested and/or programmed, or it can be your own psychological profile not being comfortable with the system's performance.

Your Answers = Change = Your Growth

What steps should we now take? Now that we have begun a corrective process where we have stopped the evil nature of our over-indulging ways to take control we should continue our "corrective nature" by invoking our findings and taking ACTION in correcting our errors.

If the problem was mechanical - fix it, if the problem was emotional either go about setting up new thought patterns, or change your current system. The answers lie in whether you need to expand your knowledge in system development, or whether you need to grow emotionally as a person.

Unfortunately there is no easy road, and even if there was everybody would be doing it. Hopefully this article has made you ponder over some of your behaviors during drawdown periods, be sure to keep an eye on yourself and as always take care of your body, because there's no use in making all the money in the world when you don't have the physical capacity to enjoy it

My Forex Stretegy will make you 20-40% Monthly!

2009-11-14T10:15:00.005+02:00

You have found the right one! My Forex Strategy have prove to pay a return of 40-100% per month for more then two years now. I have decided to open up for new managed forex accounts.

Don't you feel safe about transferring all your savings to a stranger?

Most Forex program required you to transfer the money you want to have traded the their account. In this way you don't have much control over your money and you have to trust the Forex managers to pay you the profit. Most of the time you don't see your money again.

I don't ask you to send any money to me at all! My Forex Managed Program works different, You set up your own account with any MT4 broker and give me access to trade the account. By the end of the month you pay me the profit. Yes that's correct. You are the one with the control over the money. You never have to trust a Forex manager again for getting your profit. Since the money is in your account I can not take out any of the money!

What is your trading strategy and how does it work?

I use a combination of a break-out system and a intra-day trading system to getting the results. Part of the system is running on an EA (automated forex trading program) and part is manually trading. You can not buy the EA, and I never put it up for sale.

Beginners Forex Trading: How To Start Out Forex Trading

2009-08-13T09:19:00.000+03:00

By: Trevor Johnson

Forex trading is not as difficult as it is exciting and rewarding. In order to be successful in this field you must begin by understanding certain principles that any forex trader should know. When you decide to go into business, no matter the field, you must get acquainted with the essential principles that separate successful people from those who fail and forex trading is no exception.

The first thing a beginner should know is that forex trading does not bring about a spectacular return on the initial capital in a couple of months; it may take a year or more to see good results and even this period may have ups and downs, i.e. only a few number of bumper months between consecutive losing months. Being realistic is thus most important here.

The forex markets can't be controlled as they are influenced by millions of traders if not more. No one can predict the direction and manner in which the markets may move. There is a good chance for anyone to lose on many trades before gaining on one but this is no reason why you should worry. Which activity does not imply any risk at all? None. What you should learn is how to make enough money to cover for your losses and eventually manage to grow your capital. This principle will help you to wait patiently enough for the gain to come your way instead of rushing for immediate profit which might be slippery and dangerous.

One of the most important pieces of advice that beginners should take about forex trading is using a tested system of rules, something that is known to have brought money to experienced forex traders, rather than some new system which reckless traders expect to perform miracles. In this way you can be sure you will never get sleepless nights and will be able to spare time as well.

Probably the most important aspect of a trading system is money, though many people taking up forex trading tend to neglect it and concentrate on some lesser aspects. That is why you need a solid and sound money management strategy that will protect you from big losses or final account blow out.

The fundamental economic principles are meant to attract long-term reward. You must understand that and stop thinking of short-term profit as these principles will not have any effect and will not be safe to use for day trading situations.

One last thing that you should keep in mind: Do not trust the so-called experts who make comments and recommendations all the time. Forex trading may be very stressful for a beginner if he listens to different opinions which may be contradictory most of the times. If you are a newcomer to foreign exchange trading you may listen to any piece of information but you had better not believe everything you hear. The best choice is to stick to a certain system that you have chosen and trade according to it. Anything additional may cause confusion, which is lethal to beginners.

Published At: Isnare Free Articles Directory http://www.isnare.com

Forex Trading Systems - Your Key to Building Wealth With Forex Trading

2009-08-13T09:14:00.000+03:00

By: Richard M. Davieess

In my very humble opinion Forex trading systems are the very foundation of successful trading.

In brief, a trading system simply put is a set of rules or instructions to be followed in order to enter and exit a trade. Trading systems are also referred to as trading methods, trading techniques, as well as trading strategies.

Usually when we speak of trading systems we are referring to those constructed using technical analysis.

Trading systems have become even more popular as the power of personal computers have increased tremendously. The power to analyze your trading ideas has never been greater and many traders are now taking advantage of that fact.

When it comes to acquiring a trading system you usually have two choices. You can create your own or you can buy or lease a trading system created by someone else. Which route you decide to go depends on your level of skill and technical analysis, your time, and your budget.

So why use a trading system?

There are numerous reasons that trading systems have become so popular. There used by everyone from the newest trader to multibillion-dollar financial institutions. Trading systems are effective and they are here to stay.

One reason that trading systems are so effective is that they essentially eliminate guesswork. In a properly constructed trading system the trader is instructed as to when to give in, how much to risk, and when to get out. Those are the components of a very basic Forex trading system.

Knowing exactly what to do prior to entering a trade can go a long way towards minimizing the emotions associated with trading. Controlling your emotions in trading is so important there is an entire field of psychology dedicated to it. It makes perfect sense that trading can become an emotional issue, however, because money has many emotions attached to it.

Another reason that trading systems are so popular is that they are verifiable. This simply means that a trader can take their trading system and run that system on historical data to see how it would have performed in the past. While past performance is absolutely no guarantee of future results a trained technical analyst can gain valuable insight as to how a trading system might perform in the future.

There are numerous commercial Forex trading systems available for those who have neither the desire nor the time to build and test their own. These commercial trading systems are so numerous in fact that it seems that I receive a notification of a new one just about every day.

A simple word of caution when you're looking at commercially available trading systems... take your time and evaluate them thoroughly before making your purchase or lease. I say this simply because I've taken a look at many of the numerous systems that are currently available and it appears that not all of them are created equal. Some systems look great at the outset and may appear very exciting because they trade frequently. Unfortunately once you figure in the transaction costs associated with each trade the systems don't look quite as good and some of them actually even fail miserably.

The next step is to educate yourself enough to properly evaluate a trading system. By learning to evaluate trading systems effectively you can save yourself a lot of time and money in the long run.

Published At: Isnare Free Articles Directory http://www.isnare.com