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Forex Trading Downtrend Strategy - Selling at the Top

Posted by NAZIM | Friday, December 25, 2009 | Labels:

When new investors view downtrends, they often avoid placing transaction, because they do not understand that the Forex trading market can be profited from in both ways - through buying and through selling.
In order to use Forex trading downtrend strategy, first glance at the hourly chart and try to figure out what the big picture is concerning the currency. Take special notice of support and resistance levelsthat will be a good guide to invest within. Also glance on the 15 minute chart and compare the Forex trading downtrends of this chart with the hourly chart.
Ask yourself this - Is the current trend a Forex trading downtrend? If so, is it a substantial one? What are the odds the currency price will continue in this direction, and for how long? You do not have to have exact answers to these questions, only assumptions based on the knowledge you'll attain over time. Using this Forex trading downtrend strategy, you will eventually be able to use Forex trading for a living.
Other techniques include :
Using the moving averages indicator, and comparing the current price with 60 other price examples. The current price should be lower than the moving average, and this indicator should point to a downtrend.
Comparing the current price with the previous highs and lows of the currency.
Noticing the levels of tops and bottoms over the last week.
If the previous information point to a Forex trading downtrend, then you should go ahead and sell the currency pair. If the results are ambiguous, stay updated and continue to keep track of changes in the currency that can point to a good timing for entry.


at 11:21 PM 0 comments

ForeX Trading for Maximum Profit

Posted by NAZIM | | Labels:


Description of ForeX Trading for Maximum Profit

Take an in-depth, how-to look at Forex trading using the methods, analysis, and insights of a renowned trader, Raghee Horner. As the fate of the dollar against foreign currency generates both anxiety and opportunities, currency trading has been drawing much interest and a growing following among traders in the United States. The Forex market is particularly attractive because it trades with no gaps and has unlimited guaranteed stop-losses. The liquidity of the Forex market and worldwide participation makes for more reliable and longer lasting trends as well. Raghee Horner, legendary not only as a top Forex trader but as a master teacher of trading systems and techniques, draws on her winning tools and methods, including classic charting techniques, in this book. She'll enable you, regardless of your skill level as a trader or investor, to understand how the Forex operates and lays out a blueprint for getting starting in this little-understood but high-potential trading vehicle.
Contents of ForeX Trading for Maximum Profit
Introduction
1. Trading ForeX
2. Getting Started
3. History Repeats Itself
4. The Major Players
5. Prime Trading Times
6. Reading ForeX Quotes
7. Tools of the Trading Game
8. How to Draw Trendlines
9. The Difference Between Major and Minor Trendlines
10. Fibonacci Levels
11. Visual Tools
12. Measuring Trends with CCI on Short-Term and Long-Term Charts
13. Trading Versus Investing
14. The Funnel Mindset
15. The Difference Between Scalping, Momentum, Swing, and Position Trading
16. Two Cornerstone Steps of Trade Setups
17. "Prep Work"
18. Three Classic Tools to a Three-Step Setup
19. Building a Trade
20. Rewriting Trade management
21. A Trade Going Astray
22. Placing Your Orders
23. The Five Stages of Loss
24. Tips and Tricks of the Trade
25. News "Discounting"
26. Charting the U.S. Dollar with Other Currencies
27. Raghee's Rules for Successful Trading
28. A Day in the Life of a ForeX Trader
29. Conversation with Raghee Horner
30. www.raghee.com


at 11:19 PM 0 comments

Forex Trading Inflation indicators and Interest Rates

Posted by NAZIM | | Labels:

Forex inflation indicators are used very commonly when traders analyze the Forex market. The inflation effects the interest rates, which in turn can effect the currency markets.
In order to fight inflation, interest rates are raised, and thus the country's currency is strengthened in relation to other currencies. In this way, in the short term, If inflation rises, the currency also rises in value.
On the other hand, if interest rates go higher, then investors withdraw from their investment in the country, and the currency weakens. Thus, in the long run. If inflation rises, the currency will eventually drop in value.
As a counter measure of rising inflation indicators, interest rates rise usually after meeting of BOE (Bank of England), FED (US Federal Reserve), ECB (European Central Bank), BOJ (Bank of Japan) and other central banks.
In order to measure inflation traders use different economic indicators.
Economic Indicators that Influence Inflation Indicators
Gross Domestic Product (GDP) – This measures the total market value of all goods and services that companies make within the country. This is an indicator of the growth pace of a country, and can tell the trader much about the prospect of inflation indicators.
Producer Price Index (PPI) - This measures price changes in manufacturing. It measures the changes in selling prices for the various manufacturers. The prices of manufacturing are at a close link with inflation indicators, and thus can help predict the online Forex trading direction.
Consumer Price Index (CPI) - This measures the average price that consumer pay for a fixed basket of goods and services. When the inflation indicators point to a rising inflation level, goods' prices also rise, and this can be viewed through the CPI.
These measures have been used throughout forex history to evaluate the market and make hard decisions about investments. They should also be used by you when you make fundamental analysis.


at 11:18 PM 0 comments

Trade

Posted by NAZIM | | Labels:

Trade is the voluntary exchange of goods, services, or both. Trade is also called commerce. A mechanism that allows trade is called a market. The original form of trade was barter, the direct exchange of goods and services. Modern traders instead generally negotiate through a medium of exchange, such as money. As a result, buying can be separated from selling, or earning. The invention of money (and later credit, paper money and non-physical money) greatly simplified and promoted trade. Trade between two traders is called bilateral trade, while trade between more than two traders is called multilateral trade.


at 11:16 PM 0 comments

Online Forex Trading Introduction

Posted by NAZIM | | Labels:

The online Forex market, also known simply as Forex, FX or the foreign exchange market is the biggest trading market in the world, with daily Forex trading that exceed $2 trillion.
Even tough we are talking about a huge market, Forex trading is quite simply - the buying of one currency while at the same time selling of another currency. If the trader can predict correctly which currencies will drop and which will rise - he will benefit from his investment.
There are a lot of benefits in Forex investing over other investment markets.
Why is Online Forex Trading Profitable?
The online Forex market has existed since the early 70's. Only in the past few years though, it has become accessible to millions of people through the development of the internet. Because the Forex market is available 24 hours a day, it's the only market that allows you to trade at your convenient time.
Today, because the economy is much more dynamic than it used to be, and the world has become a global village, economic conditions in various countries are also constantly changing, according to such factors as production rate, inflation and unemployment.
As a result, the rate of a specific currency changes and moves up and down in comparison to other currencies. This is the main reason of the process of rate fluctuations in the online Forex market.
In order to evaluate and predict these Forex market changes a trader can use fundamental analysis or technical analysis as a tool for investment. Where as fundamental analysis is a more broad exploration into the economic factors influencing the online Forex, technical analysis uses charts and other indicators to asses price patterns taht re-occur over time and can help predict the forex market.Foreign Currency exchange rate
Currency exchange rate is the ratio of one currency valued against another. For example, "EUR/USD exchange rate is 1.2505" means that one euro is traded for 1.2505 dollars. If you've already invested in other markets before, you'll find the Forex trading system quite similar, and the transaction to online Forex trading smooth. An example of a Forex trade: During October 2006 you buy 10,000 BRP when the BRP/USD rate was 0.56. A month later, the exchange rate grew to 0.58. This means a profit of $350 in less than a month time.
Online Forex Trading Profits
Another example of an online Forex trade: If you buy EUR/USD, this means you are buying euros, and simultaneously are selling dollars. Your expectation therefore is that the euro will appreciate (go up) relative to the US dollar.
If you believe that the US economy will weaken and this will hurt the US dollar, you would execute a buy EUR/USD order. By doing so you will buy euros in the expectation that the currency will appreciate against the US dollar. If you believe that the US economy is strong and the euro will weaken against the US dollar you would execute a sell EUR/USD order. By doing so you have sold euros in the expectation that they will depreciate against the US dollar. More information concerning online Forex trading is available at Forex Floor .


at 11:03 PM 0 comments

Forex Trading Psychology

Posted by NAZIM | Thursday, December 17, 2009 | Labels:

While learning a lot about market analysis and money management is an obvious and necessary step to be a successful Forex traders, you also need to master your emotions to keep your trading performance under strict control of mind and intuition. Controlling your emotions in Forex trading is often a balancing between greed and cautiousness. Almost any known psychology practices and techniques can work for Forex traders to help them keep to their trading strategies rather to their spontaneous emotions. Problems you'll have to deal while being aprofessional Forex trader:
Your greed
Overtrading
Lack of discipline
Lack of confidence
Blind following others' forecasts
These are very professional books on psychology written specially for financial traders:
Calming The Mind So That Body Can Perform
Emotion Free Trading
The Miracle of Discipline.


at 6:07 AM 0 comments

Forex Trading Psychology

Posted by NAZIM | | Labels:

While learning a lot about market analysis and money management is an obvious and necessary step to be a successful Forex traders, you also need to master your emotions to keep your trading performance under strict control of mind and intuition. Controlling your emotions in Forex trading is often a balancing between greed and cautiousness. Almost any known psychology practices and techniques can work for Forex traders to help them keep to their trading strategies rather to their spontaneous emotions. Problems you'll have to deal while being aprofessional Forex trader:
Your greed
Overtrading
Lack of discipline
Lack of confidence
Blind following others' forecasts
These are very professional books on psychology written specially for financial traders:
Calming The Mind So That Body Can Perform
Emotion Free Trading
The Miracle of Discipline.


at 6:07 AM 0 comments

Forex Trading Solutions Guide

Posted by NAZIM | | Labels:


Forex Trading Solutions
Forex trading solutions are sold in many forms, such as forex classes, books, and ready-made systems.In fact, there are an increasing number of sellers willing to sell you a complete system, with the trading rules completely, partially on not at all revealed.
If the rules of the system are not revealed, the system is called a “black box” system, where you have to rely on the signals the system gives without knowing how they are generated.Constructing a profitable system is not cheap and thus you’ll find many of the systems sold for $3,000+. However, despite the system being profitable in the past, nothing guarantees that any buyer will make any money with it in the future.
Forex Trading Solutions - Strategies
When purchasing a solution for forex trading, one of the first things you have to think about is the strategy that you want the system to use.The major strategies in forex trading have to do with fundamental analysis and technical analysis.With fundamental analysis, you make your own view as to where the markets are headed based on economic and other indicators. Or, you rely on fundamental analysis of a third party. Based on this view, you then make your trading calls.As for technical analysis, you make your trading decisions on historical data (price, volatility etc.) of the forex currency pair. Technical analysis gives you signals whether you should be short or long of the currency pair or stay in the sidelines.Fundamental analysis is much harder to teach of these two because it can place extraordinary weight on appearances and interpretation of situations. To assist in the analysis, many use a variety of econometric tools.Some traders use a mix of the two, with fundamental analysis sometimes overruling the signals given by technical analysis.You can purchase solutions for both of these approaches. There are many technical analysis solutions sold as PC software, books and taught in seminars and classes. As for fundamental analysis, possibilities are to look for good books on the subject or enroll in a mentoring program that teaches you to analyze the fundamental information.
Forex Trading Solutions - Techniques
Once you have a trading strategy in place, learning about trading techniques will show you how to place actual intraday trading calls, how to use market stops and other orders and how to choose the best forex dealer.What techniques you use in placing trades can make a difference in your trading results. This is particularly true for day trading, where slippage (difference between intended trade price and actual price) can easily make otherwise feasible system useless.You can learn techniques from trading books, seminars, and mentoring. In fact, mentoring is probably the best way to learn how to effectively make trades. However, mentoring is also the most expensive of the trading solutions to learn techniques.
Forex Trading Solutions - Systems
Forex trading systems are turnkey forex trading solutions. The system gives signals for the selected currency pairs and the profits and losses are made by following these signals.There are many ways to purchase or subscribe to systems. Some companies offer subscriptions to trading signals via emails based on their system. Others let you buy their software, which is used with selected currency pair’s data to get the trading signals.Some systems are sold with all of the trading rules revealed. Others will be sold as black box systems, where you just get trading signals, but no detailed information what triggers the signals.


at 6:06 AM 0 comments

Forex Trading Support and Resistance Levels

Posted by NAZIM | | Labels:

In this Forex trading guide we will try to describe in detail exactly what support and resistance means in the following Forex trading lesson. Support and resistance levels are important indicators that can be used to set stop loss and take profit orders using technical analysis.
Support levels are the places where the price of the currency is expected to rise. This happens when there is enough demand for the currency in order to stop the downtrend and therefore causes it to go up.
In order to recognize support levels in Forex trading, take a look at the Forex chart, and try to find a few lows that fluctuate in a horizontal line. This line will be set as the session's support level.If a support level is penetrated, and the currency drops below it, then it becomes a resistance level. This is caused when the currency reaches the support level again most traders will sell their currency and cause it to go down again.
Forex trading Resistance levels are also horizontal lines that appear on the upper side of the chart. Resistance levels are used to set the upper level of Forex trading, when supply levels surpass demand for the currency. After a resistance level is broken there is usually a change in the bid/ask price of the currency, and sometimes leaps upwards.
Hopefully, this Forex trading guide will help you make the right decisions in investments, and help you understand this concept of suport and resistance.


at 6:05 AM 0 comments

Forex Trading Uptrend Strategy - Buying for Low Prices

Posted by NAZIM | | Labels:

So you've recognized an uptrend, what then? How can you use your knowledge in order to invest in the Forex trading currency more wisely? In this guide we will teach you the Forex trading guidelines for uptrend strategy.
It is actually not very difficult to invest using uptrend. We will make it easier for you and dissect it into segments.
Uptrend are very useful for technical analysis, because they help you know when to buy a certain currency that is on the rise.
- First, make sure you are certain about the occurrence of the uptrend, and remember that the steeper the uptrend is the more profits are there, but also the sooner it is expected to change direction.
- Next, examine the previous developments of the Forex trading trends, and especially notice the length of previous uptrends. A common phenomenon is for recurring lengths of uptrends.
- Do not wait for the uptrend to finish rising, and try to invest in just starting trends. Placing stop and limit orders can help you be protected in cases of currency drops.
Using uptrend strategy is a basic in forex trading education, and the rest of the rules for uptrend will be gathered as you practice the real thing.
Jim Barns, Market Analyst


at 6:05 AM 0 comments

Forex Trading Uptrend Strategy - Buying for Low Prices

Posted by NAZIM | | Labels:

So you've recognized an uptrend, what then? How can you use your knowledge in order to invest in the Forex trading currency more wisely? In this guide we will teach you the Forex trading guidelines for uptrend strategy.
It is actually not very difficult to invest using uptrend. We will make it easier for you and dissect it into segments.
Uptrend are very useful for technical analysis, because they help you know when to buy a certain currency that is on the rise.
- First, make sure you are certain about the occurrence of the uptrend, and remember that the steeper the uptrend is the more profits are there, but also the sooner it is expected to change direction.
- Next, examine the previous developments of the Forex trading trends, and especially notice the length of previous uptrends. A common phenomenon is for recurring lengths of uptrends.
- Do not wait for the uptrend to finish rising, and try to invest in just starting trends. Placing stop and limit orders can help you be protected in cases of currency drops.
Using uptrend strategy is a basic in forex trading education, and the rest of the rules for uptrend will be gathered as you practice the real thing.
Jim Barns, Market Analyst


at 6:05 AM 1 comments

Forex Trading Tips

Posted by NAZIM | | Labels:

The failure to accept and take losses is the most frequent mistake by currency traders. Traders must accept the fact that losses are a permanent part of their trading existence. Taking controllable losses are just part of trading but most struggling traders spend their entire trading career to run away from losses, it’s hard for them to accept they can be wrong.Taking a loss does not always mean you were wrong in your trading decision but it can tell that your timing in entering the market was perhaps incorrect. Sometimes, it is better to close the trade for a loss and to re-enter the market at better prices.Successful currency trading is determined by how well we can manage our losing trades and not how well we can avoid them. Keeping your losses under control is the key to become a master in trading!
Tips on How to Eliminate the Sin of Failing to Cut Losses Short:
1. Never place a trade without first determining where you will close the trade if things go the wrong direction - Never place a trade without a predefined stop loss order, taking a trade without a stop is like racing down a steep hill at top speed without any brakes.2. Always adhere to your predetermined stop loss order - Never move your predefined stop loss further away from the market in the hope your losing position will reverse, doing this will often lead to much bigger losses or you can get stuck in an open trade for unknown period of time. Your stop loss is there to minimize your losses, if you continue to move it away from the market price you will lose more money for sure in the end.3. You cannot afford to win if you cannot afford to lose - Losses are a permanent part of trading existence, if you are not in a position to accept losses, either emotionally or financially, you have no business currency trading. Becoming disciplined enough to cut your losses takes time but it is the key to become a master in forex trading and remember, “you should not invest money that you cannot afford to lose.


at 6:03 AM 0 comments

Forex Vs Currency Futures

Posted by NAZIM | Saturday, December 12, 2009 | Labels:

If you have read our article comparing forex to equities you probably already know why Forex is a superior market in measuring up to the equities market. In this article we will evaluate the Forex market in conjunction with the currency futures market. Of course there are various points of distinction between each of these markets – historical, philosophical and technical to name a few. In this article we will review some significant differences between the two markets that reflect the way you trade and make money in each of them.
One of the biggest advantages the Forex market has to offer is its unparalleled volume. In fact, the amount of money traded every day on the Forex market is over 50 times bigger than the volume on the futures market. If you have read our previous Forex trading articles you probably already know that the Forex market is the biggest financial market in the world. Fact is that this size does not only indicate the popularity of the market but most of all it shows the amount of trading opportunities you can find on this market. The Forex market offers a place for any trader, from the smallest pastime traders to the professional, high-rollers.
Margin accounts and leveraging in the Forex market is quite different from the currency futures market. Currency futures brokers give different margin and take different commissions for 'day trade' and 'overnight' positions. Also, the margin rates that the futures brokers give usually depend on the size of the deal. On the other hand, Forex brokers offer the same leverage and the same margin rates at all times, day or night and with no concern to the size of the trade.
The learning curve of a new trader in the Forex market is not as steep as the one in the futures market. The methodology and quotes used in the Forex market are very easily understood and are quite intuitive, even to new traders. The futures market on the other hand is completely different. The price quotes of currency futures are inversions of regular prices that are used only in this market.
Furthermore, the futures market demands many complicated adjustments. To name a few, the futures prices include time factors, interest rates and discrepancies between interest rates of different currencies. This turns the futures market into a much less intuitive and friendly market.In summary, the Forex market has many significant advantages over the currency futures market that turn it into the natural choice for any entrepreneur or smart investor.


at 10:55 PM 0 comments

Forex Trading Trend Patterns - The Double Top

Posted by NAZIM | | Labels:

A double top is a type of Forex trading reversal patterns. A double top is recognized like so:
- First you see a long rise in currency price.
- This rise is followed by a top and a small drop, and a bottom.
- Then another small rise appears.
- The double top Forex trading pattern is complete when another top is formed and the currency starts to drop again.
The last drop of the reversal pattern is a long one, and it indicates the trader to either liquidate the currency he already has, or perform a sell order for the bid price.
The quick recognition of this 'M' shaped trend pattern can help your investment, and can justify the saying forex trading made easy'.
Double tops usually don’t appear as perfect 'M's, but over time these trend patterns are easily recognized as the more basic Forex trading trends are.
Tania Raven, Market Analyst


at 10:55 PM 0 comments

Forex Vs Equities

Posted by NAZIM | | Labels:

Any novice Forex trader questions himself sooner or later – "Why did I choose the Forex market, is it definitely the best financial market for me?" Usually this question arises from curiosity and nothing else, but curiosity must be satisfied.
In the next two articles our team will point the evident advantages the Forex market has over other well-known financial markets, starting with the famous US equities market. Any person with a feel for economics and trading experiences some sensation to the sound of Wall Street, but does it truly measure up to the colossal forex market?
First, the key benefit the forex market offers is its 24-hour accessibility. When you are trading forex it doesn’t matter at all whether it is 5am or 5pm. Time differences and market dynamics make sure there will always be an eager trader somewhere around the globe looking for a deal. This feature gives you the privilege to respond to any financial developments, as soon as they transpire. Furthermore, the prices of forex can not be affected from after-hours trade.
An additional key aspect of the forex market is its unmatched liquidity. This legendary liquidity is derived from the market's immense size, more than 50 times larger than the total trade in the US stock exchange. None the less, it's seemingly impossible size, which sometimes creates certain repulsion, and its liquidity creates stability like in no other market. The forex market is one of the most solid financial markets throughout the modern financial history.
Online forex has many advantages that the equities market can't even dream of. The leveraging that online forex brokers present is significantly better than any possible offer you can find on the equities market. The margin that the online forex http://www.forexfloor.com/fx-equities.html firmsms can offer is extremely larger than the standard 2:1 you'll get from your equity broker. The margin you get while trading forex can go even up to 100:1, and in some cases even 200:1. You are welcome to learn more about margin and leveraging in our "Margin trading overview.
Read more about the advantages in the next article that will compare the forex market to the equities market.


at 10:51 PM 0 comments

Fundamental Analysis Vs Technical Analysis in the Forex Trading Market

Posted by NAZIM | | Labels:

The main difference between fundamental vs technical analysis of the Forex trading market is that, while fundamental analysis uses economic, political, social and other factors that affect supply and demand of the trading Forex market to foresee price movements, technical analysis uses mathematical and graphical charts of previous market action, in order to analyze the Forex trading market.
The basic difference between Forex fundamental and technical analysis is therefore that:
- Forex Fundamental analysis uses various factors that influence supply and demand to predict the currency change.
- Technical analysis uses charts of previous currency change to predict the currency change.
Cause and Effect of Market Price - Forex Fundamental analysis looks at causes of currency change.
Forex Technical analysis looks at effects. Fundamental analysis causes, such as government policy, can later be seen in the technical analysis charts that constitutes the effects of the certain policy.
Types of Analysts - Fundamental investors would research a currency from top to bottom, looking at interest rates, balance of trade, the gross domestic product, unemployment and other economic factors, in order to see if a certain currency is about to rise or drop in value. Technical investors, on the other hand, would look at the price action of the Forex trading market, and view chart details such as open, high, low, close, volume and open interest for the currency price of a certain time to notice changes in the currency. This is why fundamental analysis is more suited for long term Forex forecasting, while technical analysis foresees short term changes in the Forex trading market.
Combination analysis - The most recommended method of Forex trading is to use both fundamental and technical analysis together. This way, you can study fundamental analysis of a currency, and find out what are its economic factors and what is its future direction. After this you turn into technical analysis, and study those currencies charts, trying to see the right timing to step in, and buy/sell the certain currency.
After using both types of analysis you can be sure you are covered both ways, and you can now turn to invest in Forex trading, with the confidence that you know what currency to trade with, and when to trade as well.


at 10:41 PM 0 comments
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