(by Joe Ward)
This forex beginner systems article is a comprehensive guide to the steps needed in devising a forex trading system as a beginner. Knowing which way to jump with all the information floating around can be a daunting proposition; so having a step-by-step guide by a successful experienced (and humble: lol) trader is obviously a great start. There aren't any in depth explanations here as the purpose is to highlight the areas which require further investigation, and in what order of importance. I have articles specific to each category on my website which I will link to at the bottom of the page. Anyhow, follow through with each of these steps and you will be well on the way to forex trading profit.
The main steps are:
1.) Get background information on what forex trading entails.
2.) Learn how to manage risk and size positions correctly.
3.) Find a strategy you are comfortable with.
4.) Test your strategy.
5.) Interpret the numbers.
6.) Find a broker.
7.) Rake in the cash!
Basics:
First of all, with forex beginner systems, it is important to know just what you are getting into. Forex trading is just like any other business. You wouldn't go off and try to build houses without reading a book or getting some lessons now would you? Constructing systems is much the same. Without any knowledge of the market you are essentially building a "house of cards". You don't need a Phd in macro-economics, but a solid knowledge base will only aid in your trading decisions and help ease your mind throughout the entire process.
Risk Management:
The next thing to learn is how to manage risk and size positions. These factors should be the cornerstones of any system. In essence: you need to know how much to risk losing on each trade. People often make the mistake of ignoring this factor; that's why over 90% of traders fail. Think of it in terms of being a gambler or being a casino; we know who always wins right? Do your due diligence on risk management and position sizing and you will be well on the way to becoming one of the 10% of successful traders.
Strategies:
Once you understand the numbers a little better you can look at specific strategies to trade. Forex beginner systems should be quite simple. As with many other things; simple can also be very effective. I have found that trend trading and swing trading in particular can be very simple and also very effective. The main thing though, is that you feel comfortable trading a strategy. Psychology plays a large part in forex trading too, so having a simple yet effective strategy is often the best. It's a case of K.I.S.S. (keep it simple stupid!).
Testing:
The next aspect of creating forex beginner systems is testing. Testing your system is all important in knowing if you will turn a profit or not. Don't "go off half cocked"; you may wind up with a "blown up" trading account. It's a step closer to being a "casino" and another step away from being a "gambler". To add further perspective; just imagine if boeing didn't test their planes before they used them..... Would you be getting on one? I didn't think so! It's much the same with trading; test your hypotheses and make sure they work.
Analysis:
Analyzing the results of these tests is the next thing to do. Anyone can see if a system will be relatively profitable from the results of testing. The hard part comes with understanding how to interpret the results and how they will effect your trading in real time. Analyzing the results and making necessary changes to your forex beginner systems will also likely make you substantially more profitable. There is no end to what can be done with statistics. Again let's look at our jet-plane analogy. From flying the plane we know it doesn't crash. But how much fuel per mile did it use? How much will we need to fly from our place to a nice island in the Maldives? How can we get their faster or without using as much fuel. You get it? Knowing how to get there is one thing; but getting there the cheapest and fastest way possible is harder.
Brokers:
Now it's time to find a broker to trade your forex beginner systems with. Brokers offer free trial accounts with play money to check out their wares. By all means take advantage of these offers. Also, you should be aware of some of the different types of brokers and the features they offer. This is important as well. Think of it as choosing to fly "Econo-miser" or "Champagne" airways.
Conclusion:
Now you should be all geared up with some shiny new forex beginner systems if you have investigated all these things thoroughly. If you're still not sure, there is loads more information on my site and others. There are loads of people researching new ways to make money in the currency markets, so please, check the web regularly and see what else they have found. Some offer their information free (like me) and others charge for their info. Do not be too tight with the purse strings though; as one profitable trade can often see an item paid for many times over. Now off you go and rake in some of that cash!
The original article with links to all relevant articles can be viewed here
Joseph Ward is an experienced, successful currency trader. He teaches his simple, practical and profitable forex trading methods, for free, via his website www.forex-trading-profit.org Take a look at some articles, tutorials or reviews and start your journey to forex trading profit today for free!
Wednesday 22 August 2007
Monday 20 August 2007
A Simple Swing Trading Strategy You Can Put To Use Right Now
(by Dean Saunders)
I started to develop a swing trading strategy after 2 years of trying to day trade the EURUSD. I found trading the longer time frames were not only far more profitable but also less stressful and freed up allot of time to do things I enjoy.
A good swing trading strategy must trade with the longer term trend, all we are looking to do is cut our losses short and let our profits run. It must be simple, anything complicated is only making our trading decisions more difficult.
Lets go through what rules I follow and how I identify a good trade. I trade the 4 hour charts with this swing trading strategy, it works well on this time frame and I suggest you do the same.
First we need to find the trend direction on the daily charts, if price starts in the bottom left and finishes in the top right of your screen then we are in a up trend. If price starts in the top left and finishes in the bottom right then we are in a down trend. If you have trouble show the chart to a child they will get it right every time!
Next we have to go back to the 4 hour chart to find an entry point that gives us good odds of price going in our favour. Look for retraces to the 50% fib level that coincides with good support/resistance levels, I also like to target 00 areas as this is what the larger institutions will be targeting for there orders. Remember only take trades with the trend on the daily chart!
Once you have found a suitable entry point set your order with a 50pip trailing stop loss. Please note that if you trade a currency pair with higher volatility then you will have to increase your stop to suit, 50 pip stop is for the EURUSD which is the main pair I trade.
Once your order is triggered just sit back and watch, do not interfere with the trade, you have a trailing stop to do the work for you. As soon as your position is in profit the trailing stop will move up keeping your stop exactly 50 pips behind and locking in any profit along the way.
Although many new comers looking for a swing trading strategy will laugh at this simple system I can assure you that it works. The more you get a feel for the market the more you will profit with this strategy. Trading forex does not need to be difficult, it is the human physiology that makes it hard for people to see profits disappear. Unfortunately this is part of the business and you must focus on the month to month gains not the day to day gains.
Do You Want To Make Consistent Money In The Forex Market? Dean Saunders has created the *Ultimate* FREE trading system that has helped 100's of forex traders make consistent money. Click Here and grab your FREE copy of Dean's amazing trading system!
I started to develop a swing trading strategy after 2 years of trying to day trade the EURUSD. I found trading the longer time frames were not only far more profitable but also less stressful and freed up allot of time to do things I enjoy.
A good swing trading strategy must trade with the longer term trend, all we are looking to do is cut our losses short and let our profits run. It must be simple, anything complicated is only making our trading decisions more difficult.
Lets go through what rules I follow and how I identify a good trade. I trade the 4 hour charts with this swing trading strategy, it works well on this time frame and I suggest you do the same.
First we need to find the trend direction on the daily charts, if price starts in the bottom left and finishes in the top right of your screen then we are in a up trend. If price starts in the top left and finishes in the bottom right then we are in a down trend. If you have trouble show the chart to a child they will get it right every time!
Next we have to go back to the 4 hour chart to find an entry point that gives us good odds of price going in our favour. Look for retraces to the 50% fib level that coincides with good support/resistance levels, I also like to target 00 areas as this is what the larger institutions will be targeting for there orders. Remember only take trades with the trend on the daily chart!
Once you have found a suitable entry point set your order with a 50pip trailing stop loss. Please note that if you trade a currency pair with higher volatility then you will have to increase your stop to suit, 50 pip stop is for the EURUSD which is the main pair I trade.
Once your order is triggered just sit back and watch, do not interfere with the trade, you have a trailing stop to do the work for you. As soon as your position is in profit the trailing stop will move up keeping your stop exactly 50 pips behind and locking in any profit along the way.
Although many new comers looking for a swing trading strategy will laugh at this simple system I can assure you that it works. The more you get a feel for the market the more you will profit with this strategy. Trading forex does not need to be difficult, it is the human physiology that makes it hard for people to see profits disappear. Unfortunately this is part of the business and you must focus on the month to month gains not the day to day gains.
Do You Want To Make Consistent Money In The Forex Market? Dean Saunders has created the *Ultimate* FREE trading system that has helped 100's of forex traders make consistent money. Click Here and grab your FREE copy of Dean's amazing trading system!
Saturday 18 August 2007
Day Trading Futures Contracts - How To Win
(by D.Bennett)
The successful futures day trader knows that trading is a form of betting. It is a numbers game based on probabilities. The trader’s task is to adopt a strategy with favourable odds and execute the strategy as perfectly as possible.
To be successful, the trader identifies one or more setups which signal high expectancy trades. The setups are most often related to some kind of chart pattern, or a signal given by one or more technical indicators. I look at some ideas for setups in other articles. For now it is sufficient to understand that a setup should be measurable. It is a clear, unambiguous signal to enter a trade, and each trade should be managed in exactly the same way so that the results of the trade can be accurately determined in a theoretical test situation.
The expectancy of a trade cannot be estimated without testing the strategy. You test by either trying out the strategy on historical data (back-testing), or paper trading the strategy for a period of time. In either case you are unlikely to get a decent estimate unless the sample includes a minimum of 20 trades, preferably more.
You should observe the results for the trades in your test sample and calculate the Probability of Winning - P(W), the Probability of Losing - P(L), the Average Win in dollars - A(W), and the Average Loss in dollars - A(L). Use the following formula to estimate the Expectancy for your strategy:
E = P(W) x A(W) - P(L) x A(L)
For example, you test 50 trades resulting in 30 wins (60%) and 20 losses (40%), with an average win of $300 and average loss of $200.
E = (60% x 300) - (40% x 200) = 180 - 80 = $100
This means that in the long run you expect to make $100 per trade using this strategy.
Many people examine historical data to determine a good trading strategy. After this, you cannot use the same data to estimate Expectancy, because the strategy is optimised for this particular set of data. To estimate Expectancy, back-test data from a different period or run an independent paper trading trial. Ignoring this principle results in curve fitting and you delude yourself into thinking your strategy is better than it really is.
No strategy can be profitable unless it has a positive expectation, but higher expectation does not necessarily lead to higher profit. You must also consider the opportunities to trade generated by your strategy. A strategy averaging 10 trades per day with an Expectancy of $50/trade is better than a strategy providing 2 trades per year with an Expectancy of $1,000/trade.
You can see from the formula that Expectancy is a function of both the Probability of Winning and the Average Win to Average Loss ratio. If you only win 1 in 4 trades, but the average win is $400 versus an average loss of $80.
E = (1/4 x 400) - (3/4 x 80) = 100 - 60 = 40
This is a situation where a strategy with a low probability of winning has a positive Expectancy because wins are much bigger than losses. In contrast, suppose you win 8 out of 10 trades with an average win of $80 and an average loss of $300:
E = (0.8 x 80) - (0.2 x 300) = 56 - 60 = -4
This strategy wins much more often than it loses, but has a negative Expectancy because losses are substantially bigger than wins.
There is no right answer for the balance of these parameters, other than that the Expectancy for your trading strategy must be positive. Often, improving your average win to average loss ratio will decrease the probability of winning, and vice-versa.
However, for a small trader there is an advantage in gaining positive Expectancy by having a high probability of winning. Sticking to a strategy that generates a lot of winners is less strain on the trader!
A positive Expectancy is no guarantee against a run of losses. Indeed, with most strategies it is almost certain that there will be significant strings of losses at some time. However, a positive Expectancy should lead to profits in the long run, providing the trader uses proper money management and can survive losing sequences.
In summary, the trader needs to specify clearly defined strategies which can be traded in a mechanical manner whenever their setup occurs. The strategy should be tested (avoiding the trap of curve fitting) to ensure that it has a positive Expectancy. Thereafter, the trader should execute the strategy at every possible opportunity.
That is how to win.
David Bennett trades US commodity futures from his home on the Gold Coast in Australia. He provides coaching and mentoring services for people wanting to start trading for themselves. Visit http://www.12oclocktrades.com to read more futures trading articles.
The successful futures day trader knows that trading is a form of betting. It is a numbers game based on probabilities. The trader’s task is to adopt a strategy with favourable odds and execute the strategy as perfectly as possible.
To be successful, the trader identifies one or more setups which signal high expectancy trades. The setups are most often related to some kind of chart pattern, or a signal given by one or more technical indicators. I look at some ideas for setups in other articles. For now it is sufficient to understand that a setup should be measurable. It is a clear, unambiguous signal to enter a trade, and each trade should be managed in exactly the same way so that the results of the trade can be accurately determined in a theoretical test situation.
The expectancy of a trade cannot be estimated without testing the strategy. You test by either trying out the strategy on historical data (back-testing), or paper trading the strategy for a period of time. In either case you are unlikely to get a decent estimate unless the sample includes a minimum of 20 trades, preferably more.
You should observe the results for the trades in your test sample and calculate the Probability of Winning - P(W), the Probability of Losing - P(L), the Average Win in dollars - A(W), and the Average Loss in dollars - A(L). Use the following formula to estimate the Expectancy for your strategy:
E = P(W) x A(W) - P(L) x A(L)
For example, you test 50 trades resulting in 30 wins (60%) and 20 losses (40%), with an average win of $300 and average loss of $200.
E = (60% x 300) - (40% x 200) = 180 - 80 = $100
This means that in the long run you expect to make $100 per trade using this strategy.
Many people examine historical data to determine a good trading strategy. After this, you cannot use the same data to estimate Expectancy, because the strategy is optimised for this particular set of data. To estimate Expectancy, back-test data from a different period or run an independent paper trading trial. Ignoring this principle results in curve fitting and you delude yourself into thinking your strategy is better than it really is.
No strategy can be profitable unless it has a positive expectation, but higher expectation does not necessarily lead to higher profit. You must also consider the opportunities to trade generated by your strategy. A strategy averaging 10 trades per day with an Expectancy of $50/trade is better than a strategy providing 2 trades per year with an Expectancy of $1,000/trade.
You can see from the formula that Expectancy is a function of both the Probability of Winning and the Average Win to Average Loss ratio. If you only win 1 in 4 trades, but the average win is $400 versus an average loss of $80.
E = (1/4 x 400) - (3/4 x 80) = 100 - 60 = 40
This is a situation where a strategy with a low probability of winning has a positive Expectancy because wins are much bigger than losses. In contrast, suppose you win 8 out of 10 trades with an average win of $80 and an average loss of $300:
E = (0.8 x 80) - (0.2 x 300) = 56 - 60 = -4
This strategy wins much more often than it loses, but has a negative Expectancy because losses are substantially bigger than wins.
There is no right answer for the balance of these parameters, other than that the Expectancy for your trading strategy must be positive. Often, improving your average win to average loss ratio will decrease the probability of winning, and vice-versa.
However, for a small trader there is an advantage in gaining positive Expectancy by having a high probability of winning. Sticking to a strategy that generates a lot of winners is less strain on the trader!
A positive Expectancy is no guarantee against a run of losses. Indeed, with most strategies it is almost certain that there will be significant strings of losses at some time. However, a positive Expectancy should lead to profits in the long run, providing the trader uses proper money management and can survive losing sequences.
In summary, the trader needs to specify clearly defined strategies which can be traded in a mechanical manner whenever their setup occurs. The strategy should be tested (avoiding the trap of curve fitting) to ensure that it has a positive Expectancy. Thereafter, the trader should execute the strategy at every possible opportunity.
That is how to win.
David Bennett trades US commodity futures from his home on the Gold Coast in Australia. He provides coaching and mentoring services for people wanting to start trading for themselves. Visit http://www.12oclocktrades.com to read more futures trading articles.
Friday 17 August 2007
Are Your Stops Being Hunted In Forex? Don't Let This Happen To You!
(by Dean Saunders)
A stop in trading is one of the most important things you will ever use, not only does it protect your account if a trade goes against you it also defines the risk you are willing to take on a given trade.
Many traders will not give the placement of a stop any thought at all, they see it merely as a last resort, "if all else fails my stop will be hit" attitude. Stop hunting is what you will fall victim to time and time again if you do not think about where you are placing your stops. Try not to place them too tight, think outside the box and place them where you are sure if price goes the trade will no longer be valid at all. False breakouts are one of the most common trades that take out stops, in this case I always try to trade the retrace of the breakout as appose to the first breakout which reduces you stop dramatically and you can be sure that if price falls back inside the support/resistance line that was broken the trade is no longer valid.
To give you an idea of the stop size I use, I trade 3 main systems which use's 5 minute, 4hour and daily charts stops on the 5 min charts are for scalping so they are very small at 5 pips + spread. Stops on the 4 hour charts are generally around 50 pips and on the daily charts stops are around 100 pips. My stops give me room to make a mistake which is very important in the forex market, if I misjudge my entry by 20 pips I am fine because my stop is still way back behind the closest support/resistance.
It is always a good idea to try to keep your stops a good distance away from price and give the trade breathing room this ensures that the swings will not take you out, there is nothing more irritating than being taken out of a position only to have it move hundreds of pips into your favour afterwards.
If you are ever unsure where you stop should be use this little trick that has helped me in the past, choose a place you would normally put your stop. Now move it further back to the next best support/resistance, you see the first place you choose is most likely where 90% of traders have placed there stops, large institutions will be targeting these areas to trigger positions in the market. Stops are not just a last resort for your trade, they are the trade. You should be thinking about the placement of your stop as much as where you take profit.
Do You Want To Make Consistent Money In Forex? Dean Saunders has created the *Ultimate* FREE forex trading system that has helped 100's of Forex Traders become profitable. Click Here and grab your FREE copy of Dean's amazing trading system!
A stop in trading is one of the most important things you will ever use, not only does it protect your account if a trade goes against you it also defines the risk you are willing to take on a given trade.
Many traders will not give the placement of a stop any thought at all, they see it merely as a last resort, "if all else fails my stop will be hit" attitude. Stop hunting is what you will fall victim to time and time again if you do not think about where you are placing your stops. Try not to place them too tight, think outside the box and place them where you are sure if price goes the trade will no longer be valid at all. False breakouts are one of the most common trades that take out stops, in this case I always try to trade the retrace of the breakout as appose to the first breakout which reduces you stop dramatically and you can be sure that if price falls back inside the support/resistance line that was broken the trade is no longer valid.
To give you an idea of the stop size I use, I trade 3 main systems which use's 5 minute, 4hour and daily charts stops on the 5 min charts are for scalping so they are very small at 5 pips + spread. Stops on the 4 hour charts are generally around 50 pips and on the daily charts stops are around 100 pips. My stops give me room to make a mistake which is very important in the forex market, if I misjudge my entry by 20 pips I am fine because my stop is still way back behind the closest support/resistance.
It is always a good idea to try to keep your stops a good distance away from price and give the trade breathing room this ensures that the swings will not take you out, there is nothing more irritating than being taken out of a position only to have it move hundreds of pips into your favour afterwards.
If you are ever unsure where you stop should be use this little trick that has helped me in the past, choose a place you would normally put your stop. Now move it further back to the next best support/resistance, you see the first place you choose is most likely where 90% of traders have placed there stops, large institutions will be targeting these areas to trigger positions in the market. Stops are not just a last resort for your trade, they are the trade. You should be thinking about the placement of your stop as much as where you take profit.
Do You Want To Make Consistent Money In Forex? Dean Saunders has created the *Ultimate* FREE forex trading system that has helped 100's of Forex Traders become profitable. Click Here and grab your FREE copy of Dean's amazing trading system!
Wednesday 15 August 2007
Forex Trading? Take Forex Courses First!
(by F.Robey)
Forex trading (also called foreign exchange trading) is very popular as a way to invest from the comfort and privacy of your own home. This particular method of investment has been growing in popularity since 2005.
Forex online trading is just like any other investment vehicle—full of risks that can cost you dearly if you don’t know what you’re doing or fail to act responsibly.
Some people, looking for quick cash with minimum effort, make the serious mistake of investing their money in Forex before they have any idea of what they're doing. Unless they get extremely lucky, they lose their money.
While Forex is relatively easy to understand, it is not a trading platform an amateur should try without first obtaining the proper training and information.
If you are interested in Forex, then you should look into courses that teach the basics of Forex as well as how to minimize your risks.
There are plenty of Forex course that give instruction at a classroom or online. Many people choose to learn the basics of Forex from the privacy of their own home and on their own schedule.
There are many Forex classes available and some of them are very affordable at less than $200. You can find them easily on the net, usually just by doing a search for “learn Forex.” There are some online Forex classes that actually let you sit in on a real trades in session so you can see the process of trading Forex as it happens.
While there are many fine free resources for learning about the Forex, a professional course is preferred if you want to get serious.
So if you would like to get into Forex trading, look into Forex courses.
For more free Forex tips and strategies on how to succeed in the exciting and profitable world of Forex Trading, visit http://www.ForexTipsAndTechniques.com
Forex trading (also called foreign exchange trading) is very popular as a way to invest from the comfort and privacy of your own home. This particular method of investment has been growing in popularity since 2005.
Forex online trading is just like any other investment vehicle—full of risks that can cost you dearly if you don’t know what you’re doing or fail to act responsibly.
Some people, looking for quick cash with minimum effort, make the serious mistake of investing their money in Forex before they have any idea of what they're doing. Unless they get extremely lucky, they lose their money.
While Forex is relatively easy to understand, it is not a trading platform an amateur should try without first obtaining the proper training and information.
If you are interested in Forex, then you should look into courses that teach the basics of Forex as well as how to minimize your risks.
There are plenty of Forex course that give instruction at a classroom or online. Many people choose to learn the basics of Forex from the privacy of their own home and on their own schedule.
There are many Forex classes available and some of them are very affordable at less than $200. You can find them easily on the net, usually just by doing a search for “learn Forex.” There are some online Forex classes that actually let you sit in on a real trades in session so you can see the process of trading Forex as it happens.
While there are many fine free resources for learning about the Forex, a professional course is preferred if you want to get serious.
So if you would like to get into Forex trading, look into Forex courses.
For more free Forex tips and strategies on how to succeed in the exciting and profitable world of Forex Trading, visit http://www.ForexTipsAndTechniques.com
Tuesday 14 August 2007
Forex Day Trading - A 100% Way To Lose All Your Money Quickly
(by Kelly Price)
Having been a forex trader for 25 years it amuses me when I see writers defend day trading. They say it really can make money! - Of course they have no track record to back it up just empty words. Fact is you are guaranteed to lose in day trading for one simple reason:
All Movements in Short Time Frames Are Random
Trillions of dollars trade hands each day and million of trader’s trade, all with different objectives and opinions and to say that you can predict what they do in a few hours or a day, is ridiculous. You can’t.
Volatility takes prices anywhere in a day and support and resistance levels are meaningless, so you would have the same success rate flipping a coin.
It’s absolutely impossible to get the odds on your side – PERIOD
This is of course why you NEVER see any of the vendors selling these systems give you a real time track record – Why?
Because they don’t dare trade it!
They would rather write some enticing copy and appeal to the greed and naivety of traders and make their money selling you the system – they win you lose – period.
But I have seen a track record you may say and yes will have, but it’s NOT real.
If you check the disclaimer on it you will see there all hypothetical!
What does that mean?
It means done in hindsight knowing the closing prices!
Now who can’t do that it’s not exactly hard.
If we all knew tomorrows price today we would all be millionaires but we don’t – and neither do we know what will happen tomorrow, so there not worth the paper their written on.
Day trading is a good story but the logic doesn’t add up and the biggest lie about day trading is you can make money at it longer term.
If you could you would see a track record or the vendor would shut up and trade it himself and not need your few hundred dollars.
If you want to win
Appreciate that trading is an odds game and to trade the odds you need to trade over longer periods, where the data is valid and you can have a chance of getting the odds on your side.
Finally
Don’t day trade, get real and trade with the odds on your side.
GRAB 3 X FREE TRADER PDF'S NEWSLETTERS AND MUCH MORE!
On all aspects of becoming a profitable trader including features, downloads and some critical FREE Trader PDF's and more FREE Forex Education visit our website at http://www.net-planet.org/index.html
Having been a forex trader for 25 years it amuses me when I see writers defend day trading. They say it really can make money! - Of course they have no track record to back it up just empty words. Fact is you are guaranteed to lose in day trading for one simple reason:
All Movements in Short Time Frames Are Random
Trillions of dollars trade hands each day and million of trader’s trade, all with different objectives and opinions and to say that you can predict what they do in a few hours or a day, is ridiculous. You can’t.
Volatility takes prices anywhere in a day and support and resistance levels are meaningless, so you would have the same success rate flipping a coin.
It’s absolutely impossible to get the odds on your side – PERIOD
This is of course why you NEVER see any of the vendors selling these systems give you a real time track record – Why?
Because they don’t dare trade it!
They would rather write some enticing copy and appeal to the greed and naivety of traders and make their money selling you the system – they win you lose – period.
But I have seen a track record you may say and yes will have, but it’s NOT real.
If you check the disclaimer on it you will see there all hypothetical!
What does that mean?
It means done in hindsight knowing the closing prices!
Now who can’t do that it’s not exactly hard.
If we all knew tomorrows price today we would all be millionaires but we don’t – and neither do we know what will happen tomorrow, so there not worth the paper their written on.
Day trading is a good story but the logic doesn’t add up and the biggest lie about day trading is you can make money at it longer term.
If you could you would see a track record or the vendor would shut up and trade it himself and not need your few hundred dollars.
If you want to win
Appreciate that trading is an odds game and to trade the odds you need to trade over longer periods, where the data is valid and you can have a chance of getting the odds on your side.
Finally
Don’t day trade, get real and trade with the odds on your side.
GRAB 3 X FREE TRADER PDF'S NEWSLETTERS AND MUCH MORE!
On all aspects of becoming a profitable trader including features, downloads and some critical FREE Trader PDF's and more FREE Forex Education visit our website at http://www.net-planet.org/index.html
Monday 13 August 2007
Forex Trading Fact - If You Try and Predict In forex Trading You Will Lose
(by Monica Hendrix)
Most forex traders think they have to predict where currencies will go next to win but this relies on hope and guessing and the market will kill you – most novice forex traders make this mistake and lose. There is another way and it will make you money so let’s look at it.
The Myth of Market Prediction
There are many people on the net that claim you can predict markets in advance and their Wrong and the facts confirm this:
1. If you could predict prices in advance with scientific theory then we would all know the price and there would be no market – that’s common sense! A market is market because it’s unpredictable and moves because people hold different opinions.
Now you get a lot of scientific theories the king being Elliot wave but that never made Elliot any money and is not scientific its all subjective judgment – if its subjective its not a scientific predictive theory!
You also get Fibonacci numbers prices are supposed to retrace to exact levels but they don’t – try it and lose. This theory is nothing to do with financial markets and was actually devised to solve a problem based on the copulation of rabbits! And has nothing to do with finance.
So if you can’t predict how can you win?
You trade the odds and trade on confirmation and this means simply following price momentum.
For example if prices dip towards a level of support you don’t assume it is going to hold - you WAIT and get confirmation and that means prices testing support and then turning up. You then trade with price momentum.
You are not guessing or hoping you are trading the reality of price.
If you don’t use momentum indicators now is the time to learn. There are many indicators to choose from, but two of the best are the:
Relative Strength Index and Stochastic
Why the odds are in your favour?
You are trading the odds.
Forex is an odds game you will lose trades but if you trade with the odds, you will have more winners than losers and pile up big money over time.
So when you trade forex don’t predict and rely on hope trade the reality, trade the odds and make money – losing forex traders think they need to predict to win but as we have just shown, you this is a myth and will simply see you lose.
Trade the smart way on confirmation and get the odds in your favour for big forex profits
NEW! 5 X Critical Trader PDF's & Much More
Claim your FREE PDF's and demo account and learn Forex Trading and also get: Breaking financial news, tight pip spreads, guaranteed stops $100.00 minimum investment and 400:1 leverage at http://www.freeforexguidesonline.com
Most forex traders think they have to predict where currencies will go next to win but this relies on hope and guessing and the market will kill you – most novice forex traders make this mistake and lose. There is another way and it will make you money so let’s look at it.
The Myth of Market Prediction
There are many people on the net that claim you can predict markets in advance and their Wrong and the facts confirm this:
1. If you could predict prices in advance with scientific theory then we would all know the price and there would be no market – that’s common sense! A market is market because it’s unpredictable and moves because people hold different opinions.
Now you get a lot of scientific theories the king being Elliot wave but that never made Elliot any money and is not scientific its all subjective judgment – if its subjective its not a scientific predictive theory!
You also get Fibonacci numbers prices are supposed to retrace to exact levels but they don’t – try it and lose. This theory is nothing to do with financial markets and was actually devised to solve a problem based on the copulation of rabbits! And has nothing to do with finance.
So if you can’t predict how can you win?
You trade the odds and trade on confirmation and this means simply following price momentum.
For example if prices dip towards a level of support you don’t assume it is going to hold - you WAIT and get confirmation and that means prices testing support and then turning up. You then trade with price momentum.
You are not guessing or hoping you are trading the reality of price.
If you don’t use momentum indicators now is the time to learn. There are many indicators to choose from, but two of the best are the:
Relative Strength Index and Stochastic
Why the odds are in your favour?
You are trading the odds.
Forex is an odds game you will lose trades but if you trade with the odds, you will have more winners than losers and pile up big money over time.
So when you trade forex don’t predict and rely on hope trade the reality, trade the odds and make money – losing forex traders think they need to predict to win but as we have just shown, you this is a myth and will simply see you lose.
Trade the smart way on confirmation and get the odds in your favour for big forex profits
NEW! 5 X Critical Trader PDF's & Much More
Claim your FREE PDF's and demo account and learn Forex Trading and also get: Breaking financial news, tight pip spreads, guaranteed stops $100.00 minimum investment and 400:1 leverage at http://www.freeforexguidesonline.com
Friday 10 August 2007
Forex Trading - If 95% Of Traders Lose Then To Win You Need To Do This
(by Kelly Price)
Do the opposite of what they do! This may sound obvious but most traders like to follow accepted market wisdom and trade in the direction of the crowd. If you want to win at forex trading you need to step away from the crowd – and that’s what this article is all about.
In terms of following accepted market wisdom like day trading, buying low – selling high and predicting the market, these are 3 examples of how to lose when devising a forex trading strategy and if you don’t know why read our other articles!
Here we want to focus on taking trades that the majority take and see their equity slaughtered and how you can trade in the opposite direction at the right time.
FACT:
If you buy into extreme bear markets and sell into extreme bull markets, as greed and fear blinds the participants to the reality – you will win.
Not only that - but you will trade with low risk and high reward.
It’s a fact that humans push both bull and bear markets too far and if you can spot these extremes and hit the turn you will rack up fantastic gains with low risk.
But How Do You Spot Them?
There are of course forex charts, where you can use technical analysis to look for price spikes - but this does NOT tell you how bullish or bearish the participants are - it just shows you price spikes and trends.
What you need are some sentiment indicators that show how much emotions are moving prices and when the turn is coming.
The best one of all is the CFTC Net Trader Positions and their FREE!
Not many traders use them, but this bi-weekly report is essential for all forex traders.
They show the breakdown of the futures forex markets - but these positions are just as useful when trading cash.
What do they do?
Quite simply they break the position into three main groups:
- Hedgers: These guys are the real pros and are simply hedging a cash position. There not trying to make money so are not influenced by greed or fear.
- Large Speculators: These are large funds who are mostly trend followers
- Small speculators: Everyone else
So why is the above breakdown so relevant?
Quite simply, you can look for extremes either bullish or bearish in speculative positions – with commercials holding and opposite position and moving the other way.
History shows us that the commercials are the right way around at EVERY major top or bottom and the speculators get slaughtered as the market turns.
Be careful!
You have to look for extremes. Once you see speculators heavily net long and commercials moving to the short side – a turn is coming - Prices are to far from fair value and its time to look for a position.
Watching these positions and spotting extremes in sentiment will allow you to:
Trade against the majority when everyone else thinks you are crazy!
You will have the confidence to do this, as the commercials are right about market extremes time after time and you can then look to enter your trading signals, knowing your trading with the smart money.
A Word of Caution
Net Traders positions alert you to the fact a big contrary trade is coming against the herd – but they should not be used on their own – they are not a timing indicator.
You need to use your forex charts and your normal indicators to enter a trade when price momentum turns in your favour.
Trade With the Pro’s
Want to know what the real pros are doing?
Then that’s what following the commercials via Net Trader Positions gives you.
If you want to trade with the smart money and catch the big profits from the big moves - trade with the commercials for bigger forex profits!
GRAB 3 X FREE TRADER & FREE TRADER PROFITS NEWSLETTER
More on becoming a profitable trader some critical FREE Trader PDF's and more FREE Forex Education visit our website at http://www.net-planet.org/index.html
Do the opposite of what they do! This may sound obvious but most traders like to follow accepted market wisdom and trade in the direction of the crowd. If you want to win at forex trading you need to step away from the crowd – and that’s what this article is all about.
In terms of following accepted market wisdom like day trading, buying low – selling high and predicting the market, these are 3 examples of how to lose when devising a forex trading strategy and if you don’t know why read our other articles!
Here we want to focus on taking trades that the majority take and see their equity slaughtered and how you can trade in the opposite direction at the right time.
FACT:
If you buy into extreme bear markets and sell into extreme bull markets, as greed and fear blinds the participants to the reality – you will win.
Not only that - but you will trade with low risk and high reward.
It’s a fact that humans push both bull and bear markets too far and if you can spot these extremes and hit the turn you will rack up fantastic gains with low risk.
But How Do You Spot Them?
There are of course forex charts, where you can use technical analysis to look for price spikes - but this does NOT tell you how bullish or bearish the participants are - it just shows you price spikes and trends.
What you need are some sentiment indicators that show how much emotions are moving prices and when the turn is coming.
The best one of all is the CFTC Net Trader Positions and their FREE!
Not many traders use them, but this bi-weekly report is essential for all forex traders.
They show the breakdown of the futures forex markets - but these positions are just as useful when trading cash.
What do they do?
Quite simply they break the position into three main groups:
- Hedgers: These guys are the real pros and are simply hedging a cash position. There not trying to make money so are not influenced by greed or fear.
- Large Speculators: These are large funds who are mostly trend followers
- Small speculators: Everyone else
So why is the above breakdown so relevant?
Quite simply, you can look for extremes either bullish or bearish in speculative positions – with commercials holding and opposite position and moving the other way.
History shows us that the commercials are the right way around at EVERY major top or bottom and the speculators get slaughtered as the market turns.
Be careful!
You have to look for extremes. Once you see speculators heavily net long and commercials moving to the short side – a turn is coming - Prices are to far from fair value and its time to look for a position.
Watching these positions and spotting extremes in sentiment will allow you to:
Trade against the majority when everyone else thinks you are crazy!
You will have the confidence to do this, as the commercials are right about market extremes time after time and you can then look to enter your trading signals, knowing your trading with the smart money.
A Word of Caution
Net Traders positions alert you to the fact a big contrary trade is coming against the herd – but they should not be used on their own – they are not a timing indicator.
You need to use your forex charts and your normal indicators to enter a trade when price momentum turns in your favour.
Trade With the Pro’s
Want to know what the real pros are doing?
Then that’s what following the commercials via Net Trader Positions gives you.
If you want to trade with the smart money and catch the big profits from the big moves - trade with the commercials for bigger forex profits!
GRAB 3 X FREE TRADER & FREE TRADER PROFITS NEWSLETTER
More on becoming a profitable trader some critical FREE Trader PDF's and more FREE Forex Education visit our website at http://www.net-planet.org/index.html
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