Forex Technical Analysis

Fundamental analysis of the currency for many people is the bread and butter of successful forex trading. There is no doubt that there is a lot of truth in the statement that the currency markets are primarily driven by changes underlying the economies of the world. That is why so many professional traders ensure that their information is based on the best and latest information available. The question of whether someone needs to be an expert in fundamental analysis in order to be a highly profitable home forex trader is debateable.

So what is fundamental analysis? In its simplest form is a review of all the real economic data, political decision, national and international events that have the possibility of impacting on the perceived collective awareness of the forex market that in turn will potentially drive currency movements.

It is vital to understand the enormous volume of information that comprises fundamental data. Many of the financial institutions have departments dealing with analysis, teams of strategists and economists who do their best to try to foresee market movements. And the frightening thing is that with the availability of information over the internet, every home trader also has access to that information. The sheer volume of information for many traders is overwhelming.

When I first started to look at forex trading as part of my part-time home business, I bought into the statement that I needed to understand how the markets work, the impact of all the various drivers. I could see that the task was enormous and i likened it to standing on a station platform, stretching our your hand and grabbing onto a high-speed train. The consequences can be disastrous!

So then I thought, well if the object of my analysis is large how do I tackle? As someone once said, how do you eat an elephant? The answer is one bite at a time. Now that is all well and good, until I realised that the currency market is more like the size of a prehistoric 100 ton huge dinosaur than an elephant. I have by profession been very open to the concept of analysing information prior to decision-making. Unfortunately with the scale of information, I quickly became a victim of “analysis paralysis.”

If you are starting in forex trading, have your normal 9 to five job the time available to you is very limited. I found that by the time I factored in the time travelling to and from work that only left me three hours a day during the week for my research and analysis. I quickly came to the conclusion that despite some of the advice given, for me and many others another approach had to be taken.

Thank goodness for the internet. There are a number of sites now providing free information on the times of all the key economic announcements across the world. Some provide basic data i.e. interest rate announcement in the US at 9am Eastern Time. Others will provide details of past announcements and their impact on a currency as well as a forecast for what the announcement maybe.

The home forex trader will need to gain is an understanding of the impact an announcement may have on the market. If there is one thing a market does not like, it is unexpected announcements. Very often markets will move in anticipation of an announcement, If the announcement is not in line with the anticipated result the market will move.

I personally do not see the possibility of a home forex trader being able to compete with the financial institutions. However, that is not as bad as it seems. I would suggest that a trader needs to understand that when these announcements are made, that they have a potential to move. How much is not something that can be ascertained, so why be concerned about it?

Fundamental analysis therefore is an important tool to have in ones armoury, however, those running a home forex business, do not need to become an expert in this area. For me personally, the day when I learnt that there are alternative ways of being highly successful as a forex trader without being an expert in fundamental analysis, I felt an enormous weight lift of my shoulders.

By: Kaz Kowalski

Forex traders are frequently looking for the 10 essentials of Forex trading. This article will discuss the top 10 essentials of Forex trading. Keep reading to get instant access to a Forex $100.000.00 demo account.

Forex trading is not a game, it’s a business. Only a select 10 percent of Forex traders are consistently successful. These 10 essentials of Forex trading will help you get into the select 10 percent and stay there.

Essential of Forex Trading Number 1: The majority of your time should be spent on the 15 minute chart only.

Essential of Forex Trading Number 2: Don’t overdo it. If you are new to Forex trading then only try and carve out 20 pips at one time. Once you have done that turn it off and do some more Forex study.

Essential of Forex Trading Number 3: Try not to dwell much at all on the 5 minute chart as it could only serve to distract you and confuse you.

Essential of Forex Trading Number 4: Don’t use MACD for buy and sell signals as it is useless as a trigger.

Essential of Forex Trading Number 5: Do all you can to protect your money by using 20-30 pip stops in your Forex trading. You will generally lose 3 out of 10 trades so it’s important to keep your losses to an absolute minimum.

Essential of Forex Trading Number 6: Consider employing trailing stops where you keep moving your Forex profits up to protect your losses.

Essential of Forex Trading Number 7: Keep an accurate and detailed log of all your good and bad trades. Analyze where you went wrong and what you could hav done better.

Essential of Forex Trading Number 8: Your “gut feeling” can get you into a lot of financial trouble. Only react to bona fide indicators and ignore all others.

Essential of Forex Trading Number 9: Everyone has different pivot points because everyone uses different market markets.

Essential of Forex Trading Number 10: If you’re not going to take Forex trading seriously then don’t even start!

There are many fundamentals that successful Forex traders follow to ensure they reach and stay in the select group of 10 percent of Forex traders who are consistently Forex winning traders.

By: Karin I Manning

Are you thinking of maximizing trading profits with Forex robots? The foreign exchange market is a highly volatile environment in which trades occur around the clock five days each week. It can become extremely complicated to keep track of all movements of currencies in real time. This is where you acquire the upper hand by investing in a reliable Forex robot. These types of automated trading software will help you keep track of real-time market changes and assist you in making well-informed decisions that may result in profitable trades.

You won’t be able to do much without good Forex software, as the whole Forex trading experience is about quick decisions and correct timing. Doing all your data gathering and financial analyses manually will only let you miss good opportunities as they come by. What’s more, without automation, you could sustain heavy losses without making much of a profit.

You can make lots of money consistently when you are make an investment in a Forex robot. You will still be trading 24 hours a day, five days a week, but most of the work will be done by your automated trading system. The Forex robot will track the market changes for you and alert you each time an indicator or signal redounds to your benefit.

It will be a very good idea to make this investment to help you predict the trends in the foreign exchange market correctly. With this kind of automated trading software at your disposal you will often make the right decisions to enter or exit a trade.

By: Timothy Rohrer

When you decide to trade Forex, you want to make money as soon as possible. This often leads to jumping in the currency market with real money before you are ready. That is the quickest way to lose money and lose your confidence in Forex trading. But there is a way to start making money trading currency with little or no experience that is pretty safe. Sounds good, right?

Now, before we get started, I want to make one thing absolutely clear. I am not saying you should attempt or even want to trade Forex without experience. Forex trading is a skill based activity, which means the more experience you have and the better your trading skills, the better you will do. Trying to take the “easy” way out is only going to lead to you falling prey to products and services that promise easy profits, but that don’t deliver.

But this does not mean you have to DEMO trade for months or years before you trade for real money. As a matter of fact, demo trading is only good in the beginning. Your trading changes when you have real money on the line. And the only way to understand how you will react emotionally to losing and winning real money is to have money at risk in the real market. At some point, you have to gain experience with real money at risk, as this is the best education you can get.

Here is how you can get started trading in the live markets, and gaining the necessary experience you need, even when you are just starting out and have little experience. Use a Forex signals service that also has mentoring. This method allows you to get in the real market using a professional traders signals, but also learn why the trades were taken and how you react to real money at risk in the market.

In my opinion, this is the fastest and best way to get into the Forex market. Placing trades with real money takes confidence. You can either spend the time to gain this confidence in your system by practicing on demo and making the transition to live trading. Or you can follow a professional trader you trust and get into the market without experience, and then gain the experience you need in the live market. If there is mentoring involved, you can learn way more about trading by actually trading in the real market than you can practicing system after system.

Let me make this clear. You do need experience to succeed as a Forex trader. But the fastest and best way to get that experience is in the live market following a professional Forex traders signals and getting mentoring to understand trader psychology, money management and treating your trading like a business.

By: Edward Lomax

In forex trading there are two types of brokers. The market maker type of
broker and the ECN broker. Lets cover these individually.

Market Maker Broker:

Market maker brokers is a firm authorized to create and maintain a market in an instrument. They are
usually a brokerage firm or a bank who quotes both a buy and a sell price in a
financial instrument or commodity, hoping to make a profit on the turn or the
bid/offer spread. Market makers are very important for maintaining liquidity and
efficiency for the particular finanacial instrument, as they make markets by
taking a short or long position for a time, thus assuming some risk, in return
for hopefully making a small profit on the bid/ask/offer spread.

This type of broker usually takes the other side of the trade and usually widen the spread at times
especially in volatile times. These type of brokers usually advertise that they
charge no commission on trades but in fact make their commission on the spread
between the bid/ask ie 3-4 pips depending on the currency.

Although some of these brokers offering the market maker forex trading platform have wide spreads, some offer more narrower spreads as well as offer benefits such as extensive trading
resources, free trading platforms, news etc.

ECN Broker:

On the other side of the industry there are brokers that are ECN brokers. What
is ECN? ECN stands for Electronic Communications Network. These ECN brokers do
not have a dealing desk but offer a computerised market place consisting of
multiple market makers, banks. Traders can enter competing bids and offers into
the trading platform either inside and outside the spread thereby offering
better spreads, more liquidity. By trading through an ECN a currency trader
generally gets a better price than trading with a market maker. Therefore a
forex order is routed to the best bid/ask offer. The spreads are usually quite
small 0.5-2 pips. These type of brokers usually charge a small commission fee.
This small commission fee is how the ECN broker makes their commission, they
don’t take the other side of the order as the market maker does. They only match
and route your offer to the best bid/ask order in the electronic market place.

You become the market maker in using a ECN Forex broker. Place your order inside the spread or out and see if your order is taken up by one of the liquidity providers.

By: John Cas