Never Take Too Much Risk in Forex

Taking Risk too much of capital on a single trade is one of the most terrible mistakes that any trader can commit. It is for sure that the if you lose all your capital, you are out of the field indefinitely. There is a meaningful saying in poker that going all-in works every time but once. The same applies to the Forex trading in that if you risk all of your account on every trade, it only takes one loser to wipe you out and it is only a question of time.

Generally, you should risk only 1-3% of the available capital shared to a system on any individual trade. This calculation is done by using the size and, the difference between our entry price and our maximum stop price, and the amount of capital that is allotted to the system.

If these things are combined, you can assure yourself never to loose all of your trading capital. Actually, the chances of us hitting the maximum draw down for the year are very low. The size of all trades you make should almost seem painless to your future. If you are concerned about the size of a trade then it is too big for you and you should use a lower amount forthwith. Remember that longevity is the key to the making money by trading in any trading market. Trading slowly and steadily over a long period with minimal risk is better than the trading rapidly with too much risk.

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Article Source: http://EzineArticles.com/?expert=Anil_Kumar_Raju_Addipalli

Trading - A Common Indicator Mistake

I love it when I read forum entries from people suggesting trading strategies along the lines of:

- Enter long when the RSI(14) is above 50, the stochastic (14,5,3) has crossed positive, and the Williams %R(14) is rising from the oversold area
- Enter short when the RSI(14) is below 50, the stochastic (14,5,3) has crossed negative, and the Williams %R(14) is falling from the overbought area

(Disclaimer: I just made up that strategy, so don't trade it without testing it first - the fact is though - I seriously doubt it works)

Look, there are many problems with calling something like this a strategy, but the one I want to discuss today is simply that each of these indicators belongs to the same class of indicator. The RSI, the stochastic and the Williams %R are all oscillators.

An oscillator is a momentum based indicator that moves above and below a horizontal axis representing a position of neutral momentum.

Now each of these three oscillators measures momentum slightly differently. RSI measures it through comparing the magnitude of higher closes to lower closes over a set period of price bars. The stochastic measures it showing where the current close fits relative to a high/low range over a set period of price bars. The Williams %R works on the same concept as the stochastic, showing the relationship between the current close and the high/low range set over a period of price bars, however it does so through a different formula.

Basically, all are measuring the same thing. Quite likely, you've added some extra complexity to your strategy that serves no useful purpose at all.

Is there ever a need for more than one oscillator? Possibly, yes. It depends on what you're trying to achieve. You might use one for indicating oversold or overbought price areas, and a different one for indicating increasing or decreasing momentum. You might even use one indicator twice, with different parameters, to represent momentum over both a shorter and longer time period. In this case, it's fine.

However, I suspect many traders when developing their trading approach don't really think about it to this degree. I suspect most just slap an indicator on their chart for no other reason than their platform provides it, and then look through the price history to see whether it shows potential for profits.

In this case, they can probably benefit from removing any redundancy.

So, what indicator classes are there? With some exceptions, the majority will fit within one of these four classes:

1. Trend indicators, such as moving averages, directional movement or trendlines.
2. Volatility indicators, such as bollinger bands, average true range or standard deviation.
3. Oscillators such as RSI, stochastics and Williams %R.
4. Volume / Market Strength indicators, such as volume, on balance volume or money flow index.

Generally you shouldn't need more than one indicator to determine trend, one to determine volatility, one to determine momentum, and one to measure volume. In many cases, through a study of price action, you can even eliminate those single indicators and determine trend, momentum and volatility through price alone. Of course, that's not for all people.

What I encourage you to do is to look carefully at the indicators you're using. Do you have more than one indicator from any of the indicator classes? If so, is there a valid reason for it, or is it simply redundancy that has slipped unnoticed into your trading strategy? More often than not, I'd suggest your strategy could benefit from removal of that extra redundancy. Trading is one business where 'simple really is best'.

Happy trading,
Lance Beggs

Would you like to learn more about how I trade the forex and equity index markets? Check out the articles, videos and trading resources on my website right now at http://www.YourTradingCoach.com

Article Source: http://EzineArticles.com/?expert=Lance_Beggs

How is Forex Market Different From Stock Market?

As a result of global market players, the Forex market is open 24 hours a day. This can enables investors or traders to correct their positions at any time. Because of the large number of players like Banks, Institutions and Hedge Fund Managers etc, the Forex market has narrow spreads and nearly no price gaps. This lack of price gaps enables investors to count on no-slippage order execution. However do take note that in a very volatile market the likelihood for slippage do exists.

The Large volume of participants in Forex also reduces the chance for insider information or trading. Base on history, there has never been a case of complete currency collapse in a developed country. Forex volatility in the market rarely exceeds 1% per day unlike stock which can fluctuate up to 10% over one trading session.

Trading in the Forex market has the benefit of no transaction cost. Meaning forex brokers do not charge commissions. If they do it is usually relatively small. What you pay is only the bid/offer spread which can be view as transaction cost. Forex spreads can also be quite small in major currency. Unlike stock, once you buy you have to pay commission to your broker. It is usually a certain percent of the total amount of stock purchase.

Forex trading can involves in Long (buy) or Short (sell). It is just easy to take a short position as a long one. Unlike stock, there are some limitations imposed on selling short. Therefore forex trader can easily trade in a rising or falling market.

Forex trading involves leveraging too. With more buying power, you can increase you total return on investment with less cash upfront. However increasing your leverage also increase risk. E.g. With $1000 cash in a forex broker account that allows 200:1 leverage, you can easily trade up to $200,000 in estimated value.

In conclusion, Forex Trading offers a good option to make money in a 24 hours market. It provides leverage, low commission and low amount to start. There is also no insider trader to control the market. Last but not least you can also trade in a rising or falling market.

Find out more on successful forex trading at http://pickupforextrading.com

Yeo Kian Poh Pick Up Forex Trading offer a good advice on forex trading system.

Article Source: http://EzineArticles.com/?expert=Yeo_Kian_Poh

Forex Trading News - Discover How to Use it For Bigger Profits

We have better and faster news sources than ever, yet most traders fail to use the news correctly and end up losing. Here we will show you the right way to use it and how to make huge profits.

Here we will examine why you can't trade news by itself - but how you can use it to spot sentiment changes and great risk reward trades.

FACT: The News is unimportant by itself.

The news itself is not important in any financial market and that includes forex - it's how the participants as a group react to them which is important.

While all traders have the same facts to look at, they all draw different conclusions and their conclusions combined; all added up equal the price.

Markets Discount

Many traders make the mistake of trading news stories and opinions they see; what they fail to think about is - the news is instantly discounted and the market is looking forward to the future and in addition, the news reflects the greed and fear of the majority who lose.

Judging Sentiment

You can't follow news stories and trade them this is a recipe for disaster.

We know from history that markets collapse when they are most bullish and rally when they are most bullish.

Greed, Fear News and Profits

If you follow forex charts you can see the reality of price and you can also see price spikes, where the participants push prices to far away from fair value, due to greed and fear.

It is here the news is very useful.

You can see these spikes on a forex chart, they never last long and forex news can be very useful for taking a contrary trade and timing your trading signal.

Trading in a Contrary Fashion for Huge Gains

If you have news saying the market will never stop rising or falling chances, are you have climax of greed and fear. The herd will simply push prices to far from fair value.

You saw this in the recent dollar bottom as the bearish argument became totally discounted. If you believed the news, there were no problems in other countries (there were and are) oil was going to go to $200 a barrel (despite global demand falling) and the US economy would not see rate rises soon (despite the fact they indicated they would). If you sat back and looked at these facts, you would see that dollar selling was overdone - what happened next?

The dollar made a huge rally.

If you used your forex charts you would have seen the spike climax, then a collapse and made several thousand pips profit.

Will Rodgers once said, "I only believe what I read in the paper"

He was joking but traders often take what the papers say as gospel and lose.

If it were easy to follow the news and trade in the direction it recommended, far more traders would win.

The way to use news is to judge sentiment and look closely at its impact if you can do that forex news can give you some fantastic trading opportunities and profits.

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The Ultimate Forex Expert Advisor

As to leave no one outside here, I will assume that you're a complete newbie and that your first question is: What is a Forex Expert Advisor?

Okay, an Expert Advisor is an automated tool that does a lot of the forex trading work for you. Now don't get all too excited here, it won't do EVERYTHING for you, but most of it. It will show you where to enter and where to exit. Some EAs (expert advisors) can even pinpoint this to an exact. Most of the popular EAs right now is based on the Metatrader 4 platform, which is a very good thing. An mt4 expert advisor would probably be recommended by us. "Oh! Oh! I want one now! What are the best expert advisors?" Good question. We just happen to be experts on the subject :)

Now in Forex Trading, you do need to stay ahead of the pack, so to speak, if you want to be making a lot of money, and I mean - who doesn't? Right now these Automated Forex Expert Advisors are taking the forex world by storm and tons of people have gone from 'trading solo' to doing it with a partner - an expert advisor, that is.

If you're lazy like me, you always want to find something that can do the things you need to do for you, automatically and on autopilot. If you can't find anything of the like, you hire someone instead. Makes sense right?...you make all the money, something or someone else does all the work. Sounds almost too good to be true, right? Well, that's the exact point of these expert advisors! They allow some more chill time for you :) Now I did promise to give you the 'ultimate' expert advisor, and here it is: After a whole lot of testing with dozens of expert advisors, I and my team concluded that right now - the EA called Forex Funnel is indeed the best one.

Now you can out all about Forex Funnel, why it's the best one and what the alternatives are... I and the FXTX team put together an "ultimate EA resource" type thing where we list the best EA advisors on the market.

Forex Expert Advisor Reviews

So feel free to just check that out, and after that it's up to you to decide.

Expert Advisor Reviews

Article Source: http://EzineArticles.com/?expert=Michel_Brockworth

Forex Brotherhood Review

Forex Brotherhood is a brand new Forex package which is due for release in mid August 2008 (depending on when you read this, it may already have launched). As with most new forex products, people will be looking for the "forex brotherhood scam" articles and reviews in order to find out if this package is indeed the real deal, or just another scam. Well let's see what we can make of it so far.

Firstly, if you're not aware of exactly what the Forex brotherhood package is, then allow me to explain. This has been designed to provide everything you could possibly need as a forex trader. Don't be mistaken by thinking this is just another example of automated forex software, far from it. The Forex Brotherhood has some amazing features including:

• Forum- A private forum for members only, some of which have over 20 years trading experience.
• 2 live daily webinars- These will be undertaken by the long serving forex experts hired by Forex Brotherhood.
• 2 daily Hot Reports- These will include the latest information on the days trading and any hot trends to follow.
• Automated Expert Advisor - This software will allow you to trade the forex markets on auto pilot.
• Much more - This is just the pre launch information, the complete package will be revealed when it is launched.

The Forex brotherhood package is also limited to only 1000 members maximum. If it were a scam I don't think they'd limit the amount of people who could subscribe. Forex brotherhood also comes with a full 60 day money back guarantee, so if it is a scam simply request your refund.

I'm anticipating the launch and want to get in quick, as it's being promoted heavily and is likely to reach it's 1000 member capacity pretty quickly.

If you're still not sure, I've written a more in depth Forex Brotherhood Review. This contains all the known features to date and goes in to more detail of exactly what to expect, to read it Click Here.

Article Source: http://EzineArticles.com/?expert=Tommy_Cruzdale

Forex Trading Success - Do You Have What it Takes to Win?

What makes you think you can win when 95% of traders lose money? Here is a checklist for you to see your chances of succeeding as a forex trader and being one of the elite traders, who make huge long term profits.

Here are some ways to lose money if you are thinking of tying any of them you may wish to change your mind now to avoid losses and continue your forex education!

1. Following a Forex Robot with Simulated Gains

They promise you that you will achieve success with no effort and ask you to accept there track records that are simulated going backwards. Try them and your equity will get destroyed.

2. Day trading and Scalping

Simply doesn't work, as all short term volatility is random. The people selling these always have simulated track records like the robots just mentioned.

There are more but they all fall into the category of trying to find someone else to give you success and this doesn't work in forex markets.

Not only do you need a trading edge, you also have to understand how and why it will lead you to success - lets look at this in more detail.

Success Comes From Within

Forex trading is essentially a combination of a simple robust system which you understand and can trade with discipline.

To trade with discipline, you need to know what you are doing. This means having confidence and you don't get confidence from someone telling you what to do - but from your own knowledge and learning.

Discipline & Losses

Discipline is hard, as you have to keep executing trading signals through losing periods, until you hit a home run, even when the market is making you a fool and taking your money.

A Trading Edge

This is what separates out your forex trading system from the 95% of losers. Ask yourself what is your trading edge and how will it help you beat the majority?

Don't know what it is then you don't have one!

Forex trading looks simple yet few succeed and the ones that do have these elements in their forex trading strategy

- They use simple robust forex trading system

- They have solid grounding in the basics of forex trading

- They know exactly why their system will lead them to success

- They have confidence and discipline to stick with their plan

- They know they are responsible for their Forex trading success no one else

Forex trading requires you stand alone and have confidence in what you are doing and the discipline to follow your plan.

Success is in YOUR Hands

It sounds simple and it is if you approach forex trading with the right mindset and get the right education. In forex trading the market doesn't beat the trader the trader beats himself.

If you want to enjoy currency trading success - learn the basics, get a system, get confident, get an edge and be disciplined!

NEW! 2 X FREE ESSENTIAL TRADER PDFS
ESSENTIAL FOREX TRADING COURSE

For free 2 x trading Pdf's and more essential FREE Essential Trader PDF's and an exclusive risk free Forex trading Course visit our website.

Article Source: http://EzineArticles.com/?expert=Kelly_Price

Top Four Forex Brokers

This article contends that the best forex brokers are: Saxo Bank, GAIN Capital, GCI Financial Ltd., and CMS Forex. CMS Forex accepts no commission, demands a small amount of only $200 to establish a mini account, provides users with a Free Demo account, provides leverage as high as 400:1, and has a 3 to 4 pip spread on major currencies.

Saxo Bank’s ForexTrading.com offers 24 hour online trading, streaming news from three major providers, detailed analysis from in-house experts, direct online chat to dealers, and a secure
trading environment.

GAIN Capital gives its asset managers robust technology, wholesale dealing spreads, consistent liquidity, fast execution, and access to a wide range of sophisticated tools. GAIN Capital’s proprietary trading technology today supports over $60 billion in monthly trade volume. GAIN Capital’s FOREXTrader has streaming prices in 14 currency pairs, real time profit and loss account information, sophisticated risk management tools, a variety of simple and complex order types, and full reporting capabilities.

Professional dealing practices and a service-oriented approach has earned GAIN Capital a reputation as a world class provider of foreign exchange services. Client and partners from over 110 countries currently rely on their technology, execution and clearing services, and administrative tools.

For individual investors, GAIN Capital operates FOREX.com, which offers advanced, yet easy-to-use trading tools along with lower account minimums and extensive educational resources.

GCI Financial is one of the world’s largest online brokers offering commission-free trading in Forex. GCI Financial offers Internet trading software, fast and efficient execution, and the low margin requirements. GCI Financial’s free trading software gives the investor the edge in execution, market information, and account management.

GCI Financial offers forex and indices on an online dealing platform. In their forex trading platform the trader can add and remove instruments from the ""dealing prices"" window to fully customize the trading.

Forex Broker Info provides detailed information on forex brokers, forex trading and market makers, and other forex-related topics. Forex Broker Info is the sister site of Incorporating in Florida Web.

Article Source: http://EzineArticles.com/?expert=Eddie_Tobey

Third Party Signal Accounts

With the growing popularity and easy access to the foreign exchange (ForEx) market, more and more people are drawn to it as their financial vehicle of choice. Along with this popularity come all the extras. This includes all kinds of software, trading systems for sale, books, videos, and third party signal party providers. Today I’m going to touch on a few points when seeking out a third party forex signal provider.

Before we get into choosing a provider we need to have a good understanding of what a third party signal provider is. A signal provider is a trader or analyst that generates trades that in turn get placed on your account. You can have several signal providers trading your forex account or just one.

Like anything else, all third party signal providers are not created equal. At first glance a trader may look like a home run. That same trader may well end up completely torpedoing your entire account in one afternoon. To help make sure this doesn’t happen we’ll set down a few guidelines. These guidelines will give us something to look for when choosing our third party signal provider.

1. The first thing I look at is weather the trader is a winner or a loser. This may seem obvious to nearly everyone, but I often see losing signal providers with 50-100 people trading their signals.

2. The next thing I look at is how long they have been a winner. If a trader has been winning for a week that means nothing to me. I recommend that you don’t trade any signal provider with less than a few months of results to show you. Any one can place a few good trades one week and get lucky. If you are going to be trading this trader’s signals they need to be established.

3. Look at the max draw down. This is the largest peak to trough draw down in equity that the trader has historically had. Some traders refuse to take a loss. This causes them to hold on to losing trades forever or until they turn to a winner. Turning a loser into a winner sounds great, but it will eat up a huge chunk of margin and may never turn around. If it doesn’t turn in your direction, you will have your entire account destroyed by a trader that could have taken a 30 pip loss but held on until it was an 800 pip loss.

4. The first three are easy to look at. They will be displayed right on the main screen of signal providers to choose from. Once you get a few signal providers you are thinking of using, its time to dive a bit deeper into their history.

a. Look at their actual trades. Do they have a good win rate because they have opened a ton of trades all at the same time on the same currency pair? They may have 20 winners in a row. This looks great, but if you look a bit deeper you will see that its really only 1 winning trade places 20 times. Not as impressive is it?
b. Look at their draw down on individual trades. Do they let a trade go 300 pips against them and then close it out when it hits 5 pips of profit? This is a trader who lets their losses run out of control and cuts their winning trades short. It’s not a trader that you want in control of your money.
c. Do they add to losing positions? A trader who constantly adds to losing positions hoping it will turn for them is not someone you want trading your account.

5. Choose a signal provider that suits you. Some traders may provide larger returns over time, but take bigger risks leading to bigger draw downs. This might be OK with you. If you are more conservative and cannot stomach large drops in equity you probably should choose a more conservative trader.

These are just a few things to look for when choosing a third party signal provider to trade your forex account. You should always trade a demo account before opening a live account with real money. Remember it’s your account. In the end you choose the signal providers, and you are responsible for what happens.

Margin Accounts

The key to the FOREX market for the average investor is the margin. Without margin trading currency trading would be beyond most investors. I will explain what the margin is and how it works.
When you have a margin account you are able to control large amounts of currency with a relatively small cash deposit. When you have a margin account with a broker you are in effect borrowing money from the broker to control a larger lot of currency. Currency is normally sold in lots with a value of $100,000. A common term used when discussing margin accounts is leverage. Leverage is how much you can control with a certain amount of money. The leverage is usually displayed as a ration such as 1:100. That would allow you to control currency worth 100 times the amount of money you have invested.
To better explain this in a FOREX exchange with a 1% margin account you could control $100,000 worth of a currency while only investing $1000. Margin accounts can allow you to greatly increase your profit; they also allow you to increase your risk. With a margin account it is possible for a trader to lose more than their initial investment. With a little prudence though losses can be minimized. Most brokers will terminate a trade before the losses exceed the original deposit.

Benefits
As discussed before a margin account allows you to buy more with the money you have which can greatly increase your profit on successful trades. By controlling a $100,000 worth of currency for only $1000 the potential gain is greater. When dealing with large lots of currency even small changes can produce significant results.
Currency on the FOREX market is traded in far more precise units than actual cash is. As an example the American dollar is traded down to four decimal points. So when you were to quote the dollar against another currency you will see a price like $1.7834 instead of $1.78. A PIP is the smallest unit when trading currencies, when dealing with $100,000 lots then each pip is worth about $10.
If the price of the American dollar changes from $1.7834 to $1.7934, you have a net difference of 100 pips. If you have a lot of $100,000 then that 100 pips will translate to $1000 where as if you were not using the margin your original $1000 would only show a profit of $10. Hardly what most would consider a highly profitable trade?
In short the primary benefit of using a margin account is that it can greatly increase the profit margin of a trade.

Risks
Since there is such a significant increase in profit potential when using a margin account it only stands to reason that there is also an increase. In fact it is quite possible to have your entire margin account wiped out fairly quickly. When using a 1% margin account a shift in the currency of a single penny will cost you $1000.
The FOREX exchange has many safety features to help you reduce the risk of this happening. One example is a stop loss order. A stop loss order will automatically close out your position in a currency if the price crosses the point you have set. This allows you to limit your losses while still having the opportunity to realize a profit.
Another risk that many people overlook is that if the price nears the point where your losses are close to being equal to the value of your margin account your broker may close out your position. If you were trying to rid out a temporary downturn that you expect to turn around soon you could find that your broker has closed it causing you to lose your entire balance and have no option to make a profit if the price moves up again.

This is a basic introduction to margin accounts and how they work, visit the website listed below to learn more about the FOREX market.

Earn Thousands

Test-driving an online forex demo account is the preferred method of potential traders to minimize risk. A demo account readily allows a cautious person to go online and observe exactly how a paid account would work. Think of it like playing the popular wargame Command and Conquer: you send in the troops (gobs of fictitious money), make a few tactical maneuvers (invest in speculative exchanges) and conquer territories (reap profit).

It can be addictive. Without investing and risking any real money, the investor plays with ghost money in an account and initiates buys and sells the same way it would be done in reality. The software used for these demo accounts parallels what the real trading platform does. Real figures are pulled from exchanges, trend charts are generated, and profits are calculated from buy/sell maneuvers., A trader sees at the end of the day the net loss or gain should real money had been used in the transactions.

Even a novice can trade. Let’s assume an investor pretends to open a margin account with ten thousand dollars. He watches trends in the currency markets and believes that the dollar will go up in value against the British pound. The demo software empowers him to purchase at a ten to one margin; he then authorizes a buy of one hundred thousand dollars of dollars and sells one hundred thousand dollars of Pounds. There will be a spread, or difference, which accumulates to the gains, or “profit”.

Why invest time with demo accounts? Simple. It’s safe to learn the currency trade without having real money to lose.

Think of it like crashing your car in driving simulators or doing crazy rolls in an F-14 - on a Playstation. You stretch your creativity, test your reflexes and build your skills all behind the safety of a highly immersive computer screen. Your mind gets a full reflex workout without incurring damage to property and incurring lawsuits!

The same holds true for forex trading. Spending time with a demo account allows the potential trader to gain skills and learn the ins and outs of the game and the market place. A person is then able to see if they truly have the instincts necessary for the market and have sufficient knowledge to “play with the big boys.”

Almost all online companies involved in forex trading offer demo accounts, sometimes free and sometimes for a small fee. Even if a fee is paid, it is usually worth it because a forex trader can flex his skills and knowledge for vast profits after spending some time practicing with the forex demo software.

Setting up a demo account requires nothing more than a valid email address and your name. Upon activation, you will have access to the usual charts, graphs, ordering system and even prediction tools. The latter are quite interesting, particularly predictive implements based on Fibonnacci… but take care that such tools can never predict swings in the market. Too many social, political and environmental variables cause erratic fluctuations and no software can ever take those into consideration.

Richard Peyton, my good friend, benefited from a forex demo account. After months of study of the forex market, Jackson was convinced that he could make a go of it as a day trader in the forex market. His girlfriend, however wasn’t convinced and feared the inherent risk. She considered forex nothing more than sophisticated gambling.

Richard went to a brokerage company online that he felt held good reputation. He set up a demo forex account and began to make trades as though he were using real money. After several days, on paper, Richard garnered consistent profit. He continued learning and his confidence increased that he grew anxious to open a real forex account and invest a percentage of disposable income. His girlfriend also saw how on paper he had made a nice profit and relaxed, withdrew her objections.

Today Richard and his family do very well financially through forex trading, With a demo account, he leapt into a world of vast financial potential and built a fortune. He retired his day job.

Better way to Trade FX

The buying or selling of a currency within the same calendar day is known as currency day trading. In this case, all trades are completed in the same day and nothing is held overnight. The United States passed laws six years ago that enabled small investors and common men to participate in currency day trading; previously, only large banks and financial institutions and millionaires were engaged in the practice.

Industry analysts believe that currency day trading is a well-kept secret of the rich and powerful who have the power to control all the banks, corporations and foundations throughout the world. In currency day trading, the traders have vast buying power. For instance, it enables traders to use $1 to control an investment worth $200, and $500 to control $100,000.

The professional day traders are divided into two primary categories, those who work alone and those who work for a larger institution. Most of the traders work for a larger institution as they are given access to greater resources. Large amounts of capital and leverage, expensive analytical software, and a direct line to a dealing desk are some of the facilities given to the trader who work with big companies. On the other hand, individual traders mostly manage other people’s accounts or just trade their own. As these people have limited resource access, it prevents them from competing directly with institutional day traders.

There is a lot of software with which a person can learn currency day trading practices. One needs to be a keen learner with an Internet connection. Websites such as cmsfx.com.com, Choice Daytraders and CompuTrade are some of the portals through which a person can learn more about currency day trading.

Believing these Six Myths will Slash Your Currency Trading Profits

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!

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Article Source: http://EzineArticles.com/?expert=Stephen_Todd

Forex Money Management

Most traders think forex money management is just placing a stop and it's much more than that. Good money management can turn a losing system into a winner and mediocre system into one that makes triple digit gains.

If you want to win long term at forex trading, you need to defend what you have and keep losses small. As the old saying goes - to win you need to bet and you can't bet if you're not at the table! Obvious but true.

Most traders pay very little attention to money management - but it's the cornerstone of your forex trading strategy's success, so let's look at some tips you can incorporate in your forex trading strategy and become a winner.

Leverage

The first point to keep in mind is don't use all the leverage your broker gives you.

They will in many instances give you up to 400:1 and it's tempting to use it all however, if you do you will blow your account out the water.

A good leverage is maybe 10 - 20:1.

Trading Frequency

Cut your trading frequency back.

Most novice traders simply trade too much and take low odds trades. The good opportunities don't come around often and you need to be patient and wait for them.

I know traders who trade less than 20 times a year and make triple digit annual gains so - trade only when high odds trades present themselves.

Deciding Bet Size

How much should you risk on one trade?

Common wisdom often says 2% but for a small account this risk is so small it means 20 on 1,000 account. Well you won't make much money doing that! Risk 10 - 20% of your account equity on any single trade.

Forex trading is all about taking calculated risks at the right time and making meaningful bets - if you don't like risk don't trade forex.

Diversification

If you have a small account and a good trade and you think can make big profits, don't dilute its potential. Diversification is not guaranteed to reduce risk and in most instances dilutes gains.

Always Assume the Worst

Many traders think their risk reward is their stop minus their profit objective - but that's a trader's opinion nothing more. When entering a trade always assume the worst eventuality and from there, things can only get better!

The Biggest Mistake of Novice Traders!

In money management placing a stop is normally easy, where most traders go wrong is the way they trail it.

Most traders get so excited when they get a profit, they don't want to let it get away and they immediately move their stop up to close and get stopped out on a normal counter trend swing. The market then immediately goes back the way they thought and makes thousands and their not in!

To make the really big profits, you must accept drawdown in the short term in your open equity, to bank the big profits. Look at any forex chart and you will see that the big trends last weeks, months or in some instances years and you need to hold them as long as possible.

A good way to do this is a key moving average and we like the 40 day MA, then look for trend line support or resistance just below it. It's far enough back to keep you in the trend but close enough to protect you.

Forex money management is all about taking calculated risks at the right time.

It's a fact that most traders try so hard to avoid risk, they take too little which guarantees they lose. The above money management tips if used correctly will balance the risk reward just right and lead you to triple digit gains.

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Article Source: http://EzineArticles.com/?expert=Samuel_Leslie_Berkovits

Forex Trading Education

Everybody must be well aware as to how many people are making a killing income online through Forex Trading. Every year thousands of people are raking in profit of $1,00,000 alone through Forex market.

As a beginner, Forex trading seems somewhat a complicated and very knowledgeable system to start with. Since it involve taking risk with your money, so one can't simply jump into it without sufficient knowledge on the subject. But nowadays Internet is full of information, guidance and tutorials, which can help any beginners to start immediately.

But one must be aware that where should we look our for information, as Internet is also full of crappy and scam stuffs, so a dummy can get easily lost among this, and may pick bit of pieces here and there and create his own forex trading strategy, which can prove detrimental to him/her in course of time, But then it may be too late to realize it.

Some of the most common mistakes which a Dummies can do while learning forex trading online are:

1. Choosing Inexperienced Forex Brokers - Many newbies, without proper research may get into the trap o f fake Forex Brokers, who by their misleading and tempting talk persuade them to invest through them. Thus a newbie to avoid hassles of complexity of understanding forex trading does all his trading through forex Broker, without keeping any track. As a result, he becomes a puppet in the hand of cheat broker and makes a heavy loss.

2. Starting without having proper knowledge of Forex Terminology and market situation -
Beginners in tempt and greed of making money get lured by false misleading information provided by brokers and crappy piece of information spread on net. They don't know which is the correct place to look out for market situation and accordingly how to invest.

3. Taking Decision based on spreading rumors-Rather than going by accurate predictions in the market done by expert researchers, forex market-expert, they use their own intuitions and spread people rumor to make their investment decisions, as a result of which they loose several millions of money. But nowadays Autonomous Forex Trading software created by very successful Forex Trader expert has largely solved these problems, which do away with all the problem of manual trading through forex broker.

Now one don't need to browse here and there on net for crappy information on how to start with forex trading, Any beginner planning to step on Forex Trading can easily set up his account with this software. This provides very easy selling and buying interface with 24*7 online customer support. Plus all the latest currency trends, economy movement, expert researcher advise etc is provided in one single interface, so simply no experience is required to start. One can start straight away to make raking dollars online.

To Know more about how to make easy online money with autonomous Forex Trading software and read more reviews and information about how this software is helping me to generate 3000-5000$ per month online profit autonomously click here http://www.squidoo.com/forextracereview

Article Source: http://EzineArticles.com/?expert=Garima_Bajoria

About Forex Trading systems

Forex trading systems are all about getting investments in foreign markets. Foriegn exchange are shortened to Forex. The global trade in securities in companies and products in the course of the Forex trading system. There are more than a trillion dollars traded on the Forex market everyday. You can learn to chart and follow the market in the world Forex trading on your own, or you can count on a broker as you would in the New York Stock Exchange. The forex trading systems are similar in method, but each is a proven method of how to make money, how to learn about how companies and to follow what happens to the money you invest in the forex trading markets.

You can live anywhere in the world and trade and investments in companies involved in the Forex markets. There are no restrictions on the money you can make, or the money that you can lose. The Forex markets can be tapped into online, by phone or by contact with a broker in person. If you are interested in making money, you can do it on the Forex market without your employees, or a broker to do so. You can involved in learning about investment in the Forex markets, and take responsibility for your own money, and make your own money. Many have their own businesses using their training and experience in the Forex market to make money.

The Forex market is one that the whole world, so there is sure to be something of interest to just about anyone who wants to expand their investments and their learning about money in the world. There are many experts in the field of the Forex markets, and with the help of the forex trading system that you feel most comfortable with, you can Forex market as an expert.

There are no intermediaries, such as major banks or the like when you are involved in the Forex market. There is no need for fees and transaction costs as your own trading on the Forex markets. You can learn the forex trading system that best suits your needs, and businesses follow the diagram, chart growth, and invest in companies that have a solid future. There are companies and markets through the world that you can invest in to increase your ability and your investment portfolio.

A few different regions of the trade in the Forex markets, with sessions in Tokyo, Asia Pacific and Americas. Trading has always been non-stop, and the move from London to New York to Tokyo and so on again and again. You can invest in the U.S. dollar, euro, Japanese yen, Swiss francs or among others.
You can find more information about http://www.broker-trading-system.com/ on forex trading systems.

7 Reasons to Trade the Forex Markets

More and more knowledgeable investor and entrepreneurs are shunning traditional financial markets, such as stocks, bonds and commodities and building their fortunes in foreign exchange (forex) market.
The reason they are going to all the electronic world of Forex trading is its numerous advantages over any type of investment.
Even if you are an experienced trader Basic existence or you will discover how powerful Forex.
You can make $ 200 to $ 3000 in less than 30 minutes work every day.
Forex Trading is much less risky to trade in currency futures markets, much more profitable, and much easier to trade stocks.
Why should I trade the currency market?
Here's why ...

1) The forex market is open 24 hours, that never sleeps.
You can enter a position, or leave at any time, provided that it is six days a week. You do not need to await the opening bell, as if they trade stocks. is excellent for you as you choose the best time for you to trade.

2) The volume of daily operations of Forex is about $ 1.5 trillion
It is 30 times larger than the combined volume of all U.S. securities markets. This means that traders 1498574 expert could have every $ 1 million outside the currency market every day and FOREX still has more money than the New York Stock would have daily!

3) They benefit both the rise or fall of the market market.
You have equal chances of benefit to both an increase or decrease in the market, because it 's up to you to buy a currency, or to sell it, having given the trend in market trend.

4) Can trade from anywhere.
If you like traveling, this is a dream business, you just take your lap top with you and that 's, can earn money anywhere in the world, all you need is rest assured that you can access the Internet connection.

5) The influence is considerable.
In fact, you don 't need a lot of money with foreign exchange trading, it is recommended to start with $ 2000, but you can start with $ 300, then if you have a strategy result, your investment will grow accordingly, as you can until trade at 200 times their investment. You can trade 100000 - currency unit lots with just 1% margin, or $ 1000. there is no comparison with the stock market where you need a lot of money to begin with, if you want to see the real benefits. And with that, it is necessary to send the 50% margin.

6) price movements are very predictable.
Price movement or very volatile in the FOREX, however, the currency market moves in trends, and can identify these trends - such as repeated the cycle with technical analysis.

7) No commission fees.
Unlike the stock market, brokers don 't take on official transaction.

In currency trading, you don 't need to have a lot of money to get started; can trade anytime, from anywhere with an Internet connection, you do not have a warrant pending for lack of liquidity, will not have to work all day.

The currency market has many advantages over other traditional investments, and of course, give him more freedom and more money.

With the incredible growth of foreign exchange market will see an amazing amount of traders lose all their money. Unfortunately, they have not followed the simple steps that I have prepared for you. Go through these steps and give you the best opportunity to achieve their goals.

1. Have faith in yourself

To reach the elite level of forex, you must rely on yourself and your forex education. You must be prepared to do all their business decisions, instead of relying on someone else's thoughts or ability (or lack of). Of course, you are fully prepared before every risking any money.

2. Accepting his learning curve

Unless you are a veteran trader, lost money trading the currency market. This is a security fence. I do not say this to you talk about trade. In fact, quite the opposite. You will be negotiating with others that fall to this reality every day. You, however, not risking a penny until they have learned the skills you need to make money trading foreign currencies.

3. Decide what kind of trader you are

There are many ways to trade the forex. These range from very active to very patient. You must decide the style that suits you best. The best time to learn about you, this is the time you are a commercial demonstration. There is no need to allow your learning curve to cost money.

4. Get educated

Education is the shortest path to elite forex. Regardless of its ultimate goal, we reach them faster with a large forex education. Take some time to review the different options before deciding who to trust with their forex education needs. A seminar will help shorten their currencies learning curve dramatically.

5. Continue to get educated

In order to achieve and maintain elite forex skills, you must be constantly adding to its knowledge base. Your education should never stop. In fact, one of the key points to look for in an elite forex course is lifelong learning. It's good to have an ongoing relationship with the person or persons to help you achieve your goals.

What distinguishes an elite forex traders to all others is their desire and ability to be independent. Many traders are willing to follow signs, systems, strategies, or anything else you care to call them. By adopting this approach, however, these traders are only as good as the people they follow.

A forex elite lead. Their decisions are calculated and analyzed to near perfection. They will make decisions without hesitation, and manage the growth of your account at a certain, intelligent fashion. Take your trading to their level and never look back.

10 Good Reasons why YOU should jump into Trading FOREX

The forex exchange market is a market for traders to buy and sell currencies to make profits, when the value of the currency change their favor. People are a lot of funds from foreign exchange transactions. The forex market has a great potential, everyone, including companies from large enterprises to ordinary, everyday people like you and me.

This is a very exciting trade and a huge potential to make money. Imagine the comfort of your own sitting in your pajamas on your computer…… you put on the Internet and make some fast transactions and by the time, you, get a cup of coffee, you are a few hundred dollars of the rich! You want to do » I will!

I can hear you say: "Garry! This sounds like another one of those chaotic markets such as equities, options or futures tradition, so what makes this different from what the market" »

aaah! Good question! So, in answer to your question, here are 10 good (if not great) reasons, access to forex trade:

1. First and foremost, forex trading to allow small investment. You do not need to invest thousands of dollars to start the industry. You can start with less forex transactions from $200 to $350 and can be well on your way to earn more on your first day.

2. The forex market is always open! You can trade at any time and from anywhere in the world. No waiting for the Stock Exchange open. The market is ongoing, and generally only a slight break on the weekend.

3. Funds, you invest the liquid; you can cash at any time they want. Did not wait for the day so that your shares converted into cash efforts.

4. The value of the forex market is huge: This is 30 times greater than all the U.S. stock markets combined. It is the world's largest market and the Daily coverage from 1.5 to 2 trillion U.S. dollars. This huge value, make it a profitable and desirable trade and investment in.

5. This is a high degree of stability of the trade and provide greater strength than other markets. The state and people always need the money. Although the value of different currencies cloud up and down was not as dramatic fluctuations in the stock price and generally follow a predictable trend.

6. You do not have to worry about the Commission, exchange fees, no hidden charges when you trade foreign exchange. Forex brokers to make only a small percentage, the bid and have a very distinguished and provided free of charge and brokers. This is the most beautiful for you »

7. You make money, no matter which way the currency is going to. You do not worry about the decline in monetary value, if you know how to do it and make good profits.

8. Exchange is a very transparent market. Unlike the stock market, analysts have an unfair advantage over layman, because of their insider knowledge, relevant information for foreign exchange is also provided to each through the international news. Thus, all forextransactions are in a position to make the decision, according to current market conditions.

9. The forex market is very fast! It no more than 1-2 seconds to complete your transaction, as it is doing all electronic, online and real-time.

10. Finally the good news is that you do not need any formal education, licensing, foreign exchange trade diploma or degree. All you need is to know how it works, trade strategies and some tips and tricks, you can be on your way to earn big profits.

Foreign exchange trading online may be the fastest path, financial freedom and the end of all your financial worries. It really is a good, if not the best home business opportunities for ordinary people. Feel Free to view the top performing automated system
You have the responsibility to themselves to give it a try!
Prosperity and happiness for all!