You Can Exit Your Forex Trading Transactions at the Best Price Levels

Posted by admin on Mar 29th, 2010 | 0 comments

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We are going to cover what we regard as the most challenging part of Forex trading: – When to exit a Forex trade. In preceding articles in this series on no stop, hedged Forex trading we covered “Currency trading without stops” and “Currency trading not caring which way the price moves”.

How often have you exited a Forex trade positively and then looked on as the price travelled another 100 pips in the same direction? How often have you watched as the price retraced all the way back to your entry or even beyond after you tried to squeeze the last 5 pips out of a good Forex deal? Knowing when to cash in a forex trade, one of the most challenging aspects of Forex trading.

When you enter a Forex trade all the trading signals are aligned and you can tick all entry criteria on your checklist. That is why the entry is the easy part. You are entering on your terms. When the price takes off in its intended direction it enters a mystery zone where you are dependent of the volatility of the move for the Forex transaction to succeed. You very seldom have reference points. When to cash in, or not, is always the question on every traders mind. The price tends to revisit previous support and resistance levels which makes this even more challenging.

Negative deals make things even worse. You are 30 pips down. Do you close the deal at a loss or do you wait for a small retracement to reduce your loss? Surely the price has gone as far as it can go?

It can’t go more negative? Then the transaction goes even more negative. You start thinking: “I’ve lost so much another 20 pips can’t hurt I’ll give it more room”. And so on. Many Forex traders can identify with this.

With Grid trading you don’t have that problem. You would divide the expected trading range for a particular currency for the next say 6 months (say 4000 pips) into grid levels with gaps of say 200 pips. The guesswork of when to cash in your Forex deals has been eliminated. You cash in your positive deals every time the price touches a grid level. It is as simple as that. When the result of all your deals add up to a profit you would close them all and start again. How simple can trading be? No ifs, buts or maybe’s. This is a reason why no Forex charts are required. You trade price levels, with no stops (Because each price level has a buy and sell active) and you don’t care about which direction the price moves.

The question of when to enter a Forex trading transaction is also answerred. You would use the same price levels that you use to exit profitable deals (as determined above) as the entry levels for your no stop, hedged, Forex trading grid system strategy. The process of determining the price levels is very important as some trading groups are reporting gains of one thousand percent a year on capital employed using this Forex trading technique.

This is only one example of a way of finding a grid structure. As you will see in future articles grid levels can be designed to meet the trader’s requirements in many more ways. For more information (which is freely available) on this great trading system why not search the web for “no stop Forex trading”.

This is the third in a series of seven articles on the no stop, hedged, Forex trading technique which will be presented in this article directory on an ongoing basis. Make sure that you do not miss any of them.

Spot Forex Trading – Multiple Timeframe Analysis for the Spot Forex

Posted by admin on Mar 26th, 2010 | 0 comments

Multiple time frame analysis is the inspection of forex trend indicators, starting with the largest trends and timeframes, and working backwards down through successively smaller timeframes to see how the smaller timeframes and trends feed the larger ones. When the smaller timeframes are in agreement with the larger forex trends you can enter a spot forex trade. If no forex trends exist the smaller timeframes and trends will, at some point, build a larger trends.

Multiple timeframe analysis has been around for nearly 25 years.  The MTFA method is applicable to stock and commodities trading, equity options and the spot forex trading. The method is applicable to any currency pair. We are respectful of the strong technical work of Kathy Lien and Brian Shannon outlining MTFA and their technical papers are available on the Forexearlywarning.com website.

MTFA works, it is that simple. Pips can be made from the forex daily and the method is effective, especially when larger timeframes and forex trends are traded for larger pip totals. Money management ratio for your forex trading  also improves when you are entering a larger trend.

By applying MTFA to many currency pairs your odds increase again, this is because you can choose to trade the best and largest trend available in the spot forex and ride the trends longer.

In order to conduct and accomplish a multiple timeframe analysis of the spot forex you need the proper forex chartint platform and a set of trend analysis tools and indicators to facilitate the process. Some forex tools and indicators are very expensive some are free. You must be able to analyze 7 to 15 timeframes per currency pair to conduct a complete MTFA on onecurrency pair. You also must analyze the top 15-20 traded currency pairs to seek out the best opportunity and understand todays forex trends..

The first step when conducting a MTFA on a currency pair is to inspect the largest 3 or 4 trends. See what currency pairs have established larger trends, whether the trending currency pairs are at the beginning, middle or deep into the trend. Also determine which pairs are not trending (oscillating) and which currency pairs could be developing a brand new trend. If there is a currency pair that interests you check the next support and resistance area and set a price alarm to monitor that pair. When the price alarm hits check the smaller timeframes to see if they are in agreement with the larger timeframes and forex trends, and if so enter a spot forex trade.

A forex trader can use off the shelf trend indicators to conduct a multiple timeframe analysis of any currency pair. Simple forex indicators like exponential moving averages work fine. Just apply them across multiple timeframes.

Is it possible to make forex multiple time frame analysis better?? I believe the answer is yes. Incorporating parallel and inverse analysis into the market analysis as well as support and resistance to set price alarms for notification of momentum or a possible forex trade entry point can all help.

Forex scalpers may find the method to be to their liking because you will never trade against the larger trends and potentially hang onto your forex trades much longer. One of the biggest reasons people scalp the forex is that they have no idea which direction the trend is on the pair they want to trade. Or they only look at one timeframe. Traders scalp the foreign exchange but statistics show that people who hang on longer and ride longer trends make the most pips.

Why do traders not use multiple timeframe analysis? Mostly because analyzing alot of pairs and timeframes takes time and people basically are lazy. Most forex scalpers only look at one timeframe and could possibly be trading against a larger trend, or a scalper may be at the beginning of a very large move and exit way too early. If you are near the end of a trend you may also enter a trade after a long move and be entering near the end of the trend. This is bad forex money management under any scenario. Scalpers need MTFA but forex traders  who would like to stay in their trades longer would, by nature require knowledge of MTFA.

MTFA analysis of the spot forex is here to stay. Forex traders worldwide are accepting and learning to understand the method.  MTFA is a rigorous method of analyzing the forex. But it is not difficult to learn. When combined with parallel and inverse analysis of the spot forex it is quite powerful. It can be applied to any currency pair using free forex trading tools and forex charting systems available on the internet from many spot forex brokers.

Online Forex Trading: How to be Successful

Posted by admin on Mar 23rd, 2010 | 0 comments

How to trading in Forex is just not enough to be successful. In the largest and the most liquid financial market in the world, you have to need more than the knowledge and skill to be successful. You need to know about different things involved in Forex to earn lots of money

It simply knows about how to trade in Forex and about the major currencies trading, like the US dollar, the Japanese Yen, and others are just the basics. It is also equally essential to know when to trade and what to trade in Forex. For all of these you have to know about trading strategy. Also know about different kind of strategies needed in Forex.

There are different kinds of strategies that can be use in Forex market for trading.

After using these strategies correctly. You can earn lots of money in very short time.

But you have to know online forex trading is very different from stock trading. So that, using strategies are also different. In the first strategy that you can use for earning lots of money in Forex market is Leverage Forex Trading strategy. In this strategy you are an investor in the Forex market, to borrow money to increase earning potential .by this method you can easily made money to 1:100 ratio. But risk factor is involved here. Most commonly used strategy is leverage Forex trading by Forex traders

In second strategy called stop loss order. Where Forex trader predetermined a point in the trade where trader will not trade. This strategy can be use to minimize risk and loss. Also this technique backfires to you as a Forex trader. It is depend to you to decide which technique to use

Some of the techniques that you can use when trading in the Forex market.

Forex trading is a 24 hour market where trader can trade anytime and anywhere. If trader thinks that the Forex market conditions are good at a specific time, then he can trade at that specific time. Also, the Forex market is the most liquid market in the world. This means that trader can enter or exit the market anytime. This is to minimize the risk and there is no daily trading limit.

Here are some of the tips that you should remember to earn money in the Forex market

1) The first and the last ticks are the most expensive. So, the rule of thumb is getting in late and get out early in market.

2) When you are losing, and you want to reduce the risk of losing more money. So, do not add more money when you are losing.

3) Select trades that move with the trend. This may minimize the risk of losing money and maximize chances of profits.

There are some of tools that you can use when trading in the Forex market. One is the Forex charts. For the speculator, the chart is the most important tool that traders can use to determine market trends and accurately predict the future value of the currency. Although it is not actually 100% accurate, you can use the Forex charts as a guide to what’s happening in the market.

Trader need to know how to read the different charts involved in the Forex market. There are daily charts, hourly charts, 15 minute charts and even 5 minute charts to the action. You can compare each of the data in the chart to check market trends and at the same time, spot potential money making trends.

This can help you minimize the risk when trading in Forex. Learn how to read charts effectively and you will be well on your way to become successful in the Forex market.

These are some the techniques and tips that you should always keep in mind in order to minimize the risks and maximize your earning potential in Forex trading. Depending on your skills and how you apply your techniques, you can really make huge money in the Forex market. However, to be a truly successful Forex trader, you have to accept the fact that you will lose money sometimes. Never get discouraged when you loss. Analyze where you made mistake, and think of a solution to get back what you lost and continue trading.

Profitable Forex Trading Strategie

Posted by admin on Mar 20th, 2010 | 0 comments

As you know, the only way to make money in the forex currency exchange market is to have profitable forex trading strategies and good money management. Without these two skills, you will certainly fail as a trader and if you master these, you will be a very profitable forex trader.

It sounds so easy, doesn’t it? Two simple rules to follow and you will be profitable in this business. The problem with this however, is that most people can’t follow these rules. They let their emotions get in the way of their trading and make bad decisions. They may not take any trades at all because they’re afraid they’ll lose money. They may be in a profitable trade and decide to close it early to lock in their small profits. They may decide to let their losers run longer than they should because they “know” the currency is about to reverse and go in their direction. There are many reasons why people fail in this business and these are just a few of the examples.

Before you start trading, you need to learn about this business. You not only need to learn how and when to trade forex, but you also need to know when “not to trade”. This is just as important. You also need to know how much “risk” you should take on any given trade. If you over leverage your account, you will lose money very quickly and you could actually blow your entire trading account.

Once you learn how to trade, the next step would be to open a forex demo trading account. This is the trading platform you would use from the forex broker of your choice to make trades in the market. Most forex brokers have all the charts and tools you need and the platform on which to execute your trades. Demo accounts allow new forex traders to trade fake money while trading the live market. You get to trade on a live trading platform but you risk absolutely no money. There aren’t any businesses I know of where you can learn everything you need without costing you a dime.

Demo accounts are a great way for new traders to get a feel for trading the forex market without risking any money. But be careful. When you trade a forex demo account, and you know in your mind that you have no money at risk, you can start making stupid trading decisions. You may use poor money management skills and risk far too much money on each trade. You may double up on trades to make up for losing trades. These are bad habits, and the last thing you want to do in this business is treat it like a game. It’s not a game. It’s a real business and should be treated as such.

Before getting into trades, you should also know exactly what price you’re getting in to the market and also know what your stop loss and take profit targets should be. If you don’t know these three things, do not trade. Every profitable forex trading strategy you learn will have the rules for determining these entry and exit points. Also know that a profitable forex trading strategy does not have to be complicated. Most of the best forex trading strategies are very simple to learn and use.

If you follow the simple rules we mentioned above, you will see how profitable this business can be. It’s no wonder why trading forex is becoming one of the fastest growing home businesses today. You get to work from your home using your personal computer and an internet connection. Pick up a great forex trading strategy and open up a forex trading account with a broker and you have everything you need to start trading.

Forex Trading Systems – How Well Do They Work?

Posted by admin on Mar 17th, 2010 | 0 comments

For some forex traders, using special forex trading systems are the only way to go if they want to enter the world of forex trading. Since Forex market is a very complex world it is only appropriate for the forex traders to have the assistance of different systems. These forex trading systems will allow the forex traders to have an edge when it comes to boosting and increasing the odds of earning loads of money in the long run.

First and foremost, you have to understand the basic ways how the forex market works before making any forex trading transactions. Forex market has three markets which allow for the forex traders to trade all day long, 24 hours a day. Though the 24 hour market has some advantages, you should not also neglect the fact that this can be difficult and confusing at some point. The main objective of the forex market is to deal all the different currencies in the world. This exchange causes the rates of the different kinds of money all over the world to fluctuate. A lot of people have earned a lot of money just by trading Forex. However, getting to the top of the Forex market is not that easy that’s why you will need the help of different forex trading systems to aid you on how to make trades successfully.

With this in mind, here are the different kinds of trading systems that will help you earn a lot of money as far as making forex transactions are concerned.

The trading platform is a system used in forex trading which basically contains all the important skills that you will need as you go through the training process of making the right decisions when it comes to trading. This software or system has all the information and basic knowledge that will aid you to make wise decisions in the world of forex trading. Though this software will help you to eliminate all the guess work, this does not necessarily mean that it is the perfect forex trading system for everyone.

Another type of trading system used in the forex market is the signal software. As the name of this system suggests, it will help you to look for the signals that are significant when it comes to making forex trading. Though this system may help you in most advantageous ways, this has also some limitations and therefore an extra attention when it comes to trading is required on the part of the forex trader.

Charting applications is another form of forex trading systems. This system allows the forex traders to understand the current trends of foreign exchange and it enables them to receive important tips when it comes to purchasing and and making the right decisions when it comes to foreigh exchange. A single forex trading system is not enough for you to earn lot money as far as forex trading is concerned. The combination of these three Forex trading systems is one of the best recipes for earning huge amount of profits.