Forex Trading: A Solution to Wealth Creation in Today's Economy

By: Donald Ogilve

During this year, we have witnessed just how badly the global economy has been affected by challenges and setbacks. The dreary economic landscape however does not have to be a stumbling block in our efforts to create wealth and financial well-being for ourselves. Instead, we could view it as an opportunity to break with old habits and seek out new and creative ways to find new sources of income that could propel us to new heights of success, even during these trying times. One of the ways to create income and build wealth is Forex Trading. In the last few years, it has essentially gone from being in the realm of the big time investors to being accessible to regular people. The Forex market turns over more than 3 trillion dollars everyday. With those kinds of figures, there's plenty of room for everyone. The question, of course, is why someone like you would be interested.

5 Advantages of Forex Trading

Scale: The Forex marketplace is a buzzing 24 hour economic hub with seemingly endless activity. It is the most liquid market in the world, with more than 3 trillion dollars in trade changing hands each and everyday. It really doesn't matter which part of then world you are currently in because the markets are open twenty-four hours a day from Sunday Evening to Friday evening in the US. That means there's always time for you to be part of this marketplace and get a taste of the action. For instance, if you work full-time, you can see considerable return by trading after normal working hours.

Bi-Directional Opportunities: When trading Currency pairs, down does not necessarily mean a loss. You can make profits by either buying or selling, as the situation demands. If you own stocks and things go bad for the industry or company you own - as was the case during the economic crisis - then you lose money as the prices fall. While shorting stock is an option, it isn't the same as selling a currency pair. This means that getting involved in currency trading does not mean you need to find an asset at a "cheap" price so you can make money when it rises in value. You can simply get in and determine whether to sell or buy.

Small Start up Capital: One of the major advantages in about Forex trading is that you don't need a huge start up capital to make things work for you. In fact, you don't really need money at all to start practicing in real market conditions, as most brokers will allow you to trade on a demo account to sharpen your skills before you start using real money. Once you're ready to get going, you can usually open a mini-account for a few hundred dollars to begin trading. Of course, care has to be taken as new traders might easily wipe out their accounts. The point here is that this opportunity was not available, but it is now. I personally started out with less than a thousand dollars in my account, and built it up from there. You can start with a small amount of investment and slowly build up your wealth and power as your own knowledge and mastery of the Forex marketplace grows.

Plenty of Courses: There are plenty of successful Forex traders eager to share their knowledge on ways to be successful as a Forex trader. You don't really have to invest a lot of money to find valuable information about Learning Forex Trading. You can surf the internet to get plenty of free material that will give you a good insight of what it entails. Brokers will also often give you free lessons to encourage you to trade. You just have to invest a little time to get the basics.

Information Updates: We live in the information age. With an internet connection and a wide variety of news sources, you can easily keep up to date with fundamental and technical information that affects the Forex Markets.

With all of the above to take into consideration, Forex Trading has become another valuable avenue for wealth creation today.

Article Source: http://www.articlesnatch.com

About the Author:
Donald Ogilve is a Forex Trader who runs the Online Forex Blog ForexInitiate.com where he offers tips and a free subscription to an eCourse "Insider's Guide to Forex Trading", a complete introduction to Key Forex Trading Concepts. Visit ForexInitiate.com for Forex Information and Resources

Forex Trading Information - Facts All Novice Traders Need to Know

By: K Price

Before you start trading you need the right Forex information and education and in this article, we will look at some essential facts all novice traders need to know. Let's look at the first obvious fact...

1. Forex Trading is Not Easy!

Before you start trading, you should be aware that 95% of traders lose. There are lots of vendors telling you that you will get rich with no effort but that's not true in real life and certainly not true in Forex trading. You can win but first let's look at the method most traders use when seeking Forex Profits and it's the subject our next fact:

2. Forex Robots and Expert Advisors all Lose Money

Many traders think they will win by following a cheap robot or Forex Expert Advisor and they all lose their money. hese trading systems make grand claims but have no results that are verified to back up the claims. If every one could get rich by paying hundred dollars or so a lot more traders would win and they don't.

3. You Have to Work Hard or Be Clever to Win at Forex

Hard work does not guarantee profits and neither does being clever. Forex trading is essentially simple and you don't get rewarded for effort, you get rewarded for being right with your trading signal and that's it.

4. Simple Systems are Best

This leads on from the above fact and it's true. If you make your trading system to complicated it will simply have too many elements to break, simple systems are more robust and more profitable.

5. Money Management is the Key to Success

Most novice traders lose because they over leverage their accounts and don't pay attention to equity preservation. To win at Forex you must have robust money management that protects your equity at all costs.

6. Discipline

Most traders can't trade with discipline because they follow other traders systems and have no confidence when they start to lose or they simply can't take losing, because it hurts their ego and their emotions get involved. If you can't follow a trading system with discipline you don't have one!

7. Anyone Can to Trade and Anyone Can Win

Forex trading is a learned skill, if you take time to get the right Forex education and mindset, there is no reason you can't make a great second or even life changing income.

To win at Forex trading, requires you get the right Forex trading information and get confidence in what you are doing. When you have done this, you will have the mindset to trade with discipline and will be on the road to long term currency trading success.

Article Source: http://www.articlesnatch.com

About the Author:
NEW! 2 X FREE ESSENTIAL TRADER PDFS
ESSENTIAL FOREX TRADING COURSE For free 2 x trading Pdf's, with 50 of pages of essential trading info and more Forex Trading Tips visit our website at: http://www.learncurrencytradingonline.com

The Use of Currency Trading Pairs

By: Pete Miguel

If you plan to go into forex, one of the most important points you need to understand is how currency trading pairs work. Although you are free to experiment and sift through other currencies where you can possibly make a profit, pairs in currency trading are the basics where you will base your trading plans from. If you are new in the field of currency trading, you should definitely consider being an expert with the currency pairs before you explore other fields.

In forex, currency pairs work by relating their values against each other. Each pair is composed of a base currency and a quote currency. The base currency is the first among the pair which is the target currency that you wanted to buy. Meanwhile, the quote currency is the second among the pair which tells you how much of it do you need to buy the base currency or the first one. Using the USD to Euro conversion, a quote presented as USD/Euro=.067 simply means that you will need 0.067 Euros to be able to purchase one US dollar.

Working with Currency Trading Pairs

To be able to plot out your plan in the forex business, you will constantly need to consult your own currency pairs. Among the most popular trading pairs are the combinations of US dollars and Euros, US dollars and Japanese Yen, US Dollars and Swiss Franc. Most of the forex traders use US dollars as their quote currency since it is the most widely used currency in the world. The Euro, Swiss Franc, and the Japanese Yen are among the highest yielding and also most volatile base currencies in the trading game.

As a forex trader, it is your responsibility to keep track of currencies individually. In reality there really are no hard and fast rules about currency pairs. You are the one who gets to ultimately decide which of these pairs you plan to keep an eye on and develop. But it helps to have a separate track of these currencies individually so that if a raise occurs in each of them, you can easily form your pairs and make a sell or buy them at the soonest possible time. The thing about currency pairs is that they may not last as long as you would like them to. Sometimes, you need to make quick pair ups to keep ahead of the game.

Choosing the Best Currency Trading Pairs

As mentioned, there are actually no limits to which currencies must be paired against each other. What it takes is a watchful eye and keen observation to make sure that you have the right combination to trade in the currency market. But if you are a newbie and you are still trying to gain your momentum in the currency market, it will be good to stick with major currencies, such as dollars and euros, as your quote currency.

Although these currencies fluctuate as much as the others, they are also the more frequently used. These currencies will help you develop your own style when it comes to scouting the currency trading game since they are widely used. It is also a good idea to keep only two pairs at a time and gradually increase as you gain more confidence in buying and selling your existing currencies.

Article Source: http://www.articlesnatch.com

About the Author:
The secret to becoming successful with forex is to always be on top of the game, keep yourself abreast with the important updates about currency trading: Forex Currency News Trading website will certainly guide you. Never ever be a victim of wrong decisions about any forex programs you get involved with. Learn from the best online forex scam reviews site available.

Traders Resource

It doesn't matter if you trade Forex, Futures, Stocks, Commodities or any market for that matter. This code that I am talking about will rock everything you have ever learned about trading! Learn More

Forex Trading (Best seller)
How To Trade The Forex Market With A Secret Trading Formula Only a Handful Of Traders Know. 5 years of research to produce the most deadly accurate trading system ever.

Learn More

How To Trade The Futures Market (Best Seller)
On the Internet it is hard to know who to believe; there are so many people making big claims, claims that their products simply do not live up to. I truly believe that any trader, whether novice or experienced, will gain valuable and profitable insights into trading by reading my course. Learn More

Trading For Beginners(Best Seller)
The secrets of scientific trading are revealed in this must have amazing book. Year after year new and experienced traders have been amazed by the straight talk, no nonsense approach to trading. This should be the first and most important book in your library. Learn More

Being A Technical Analyst

One of the main ways traders approach the market is that of technical analysis. A technical analyst doesn't look at income statements, balance sheets, company policies, or anything fundamental about the company. The technician looks at the actual history of trading and price of a security or index. This is usually done in the form of a chart. The security can be a stock, future, index, currency or a sector. It is flexible enough to work on anything that is traded in the financial markets.
The technical analyst believes that the market price reflects all known information about the individual security. It includes all public and insider information and reflects all the different investor opinions regarding that security.

Just as fundamental analysis looks at the past to help make a decision, technical analysis also incorporates the past to aid in the decision making process. However, the technical analyst believes that securities move in trends and these trends continue until something happens to change that trend. With trends, patterns and levels are detectable.

The tools of the technical analyst are indicators, patterns and systems. These tools are applied to charts. Moving averages, support and resistance lines, envelopes, Bollinger bands and momentum are all examples of indicators.

These indicators help tell a story and just as a doctor looks at x-rays to help him make a decision, an analyst looks at charts to help him make a decision.

Many people believe that to buy and hold is the right strategy for owning securities and this is fine in some circumstances. It can also be beneficial to buy and sell the same security many times in a given period.

ABC.inc might be a company you want to own for the long term and that's fine. However, there's nothing wrong with buying at 50, selling at 67 and buying it back at 55. There's also nothing wrong with buying at 50, selling at 67, shorting the security at about 67 then closing your short at 55 and buying it back. In the previous example you have made your money work a little more efficiently. In the case of buying and holding you only make money when the security goes up. Why not make money when the security goes up, comes down, and goes back up again. This way, your money has worked harder for you. Technical analysis can help in predicting turning points and direction in prices.

Before applying technical analysis make sure you thoroughly understand the principals that you are applying. Read as much as you can and find a few forms of technical analysis that you feel comfortable with. Remember you only need to find one thing that works in order to make money.

Good Trading

Article by
Mark McRae
http://www.traderssecretcode.com

Envelopes

We are going to use some basic indicators in a different way to try and get a precise entry into a trade.

What we are going to show here is the use of Envelopes, which form trading bands. The particular trading bands we are going to use will be based on exponential moving averages. This will help us form a method to trade. This is basically an intraday strategy, which works well on the 10min/15min time frame.

Envelopes are used to indicate the trading range of a given market above and below an average price. Basically, moving average envelopes or trading bands are calculated by taking a moving average and calculating upper and lower trading bands as a fixed percentage above and below the moving average respectively.

These are considered to suggest extreme overbought or oversold conditions. The assumption is that, price should not deviate from the average of the underlying price element (high or low) by the percentage utilized.

They differ from Bollinger bands, since Bollinger Bands place boundary lines based on standard deviation, whereas envelopes place lines at fixed percentage points above and below a moving average line. The upper and lower limits specify entry and exit points for traders.

But, instead of using them to indicate overbought or oversold conditions, we will attempt to create a narrow trading range and base the rules for this method on this narrow band. We will keep our settings for the Trading Bands as (40, 0.30)

This means you have a band of two moving averages of 40, with a fixed percentage of 0.30 above and below. We then use another Exponential moving average with a setting of 15. The additional moving average is to help identify when the market is beginning to trend.

The first rule is - do not enter a trade when the price is within the band. A trade is signaled only when the price moves outside the band. The general policy is to go long when the price is above the band, and to go short when the price is below the band.

The second rule is for confirmation - don't trade when the 15 exponential moving average is flat. Only trade when the 15 exponential moving average starts rising or falling in the direction of the trade.

This method keeps you out of the market when there is consolidation, which means more chances of getting whipsawed.

The chart below, clearly shows that price was within the band for the first part of the chart and entering a trade here would have got you whipsawed. As a matter of fact, the EUR/USD was in a major uptrend on the daily charts at this time and this method gave us a precise point to enter the trade on a lower time frame.

The red line is where the market was in consolidation. The market then began to rise slightly and the 15 exponential moving average also began to rise - this is the set up.

Even though the market was set up for a trade, the safe play was to wait for 15 exponential moving average to start to trend and for the price to be well above the bands.

The market then pulled back forming resistance. This resistance area is what we are looking for. A break of the resistance is the final confirmation that we have a high probability trade.

The entry is made on a breach of the previous resistance with an initial stop just below the support area that formed.

Suniiel A Mangwani

Good Trading

Best Regards
Mark McRae

Bollinger Bands Revealed

Bollinger bands are an integral part of just about every charting system I have ever seen but many traders are unfamiliar with how to use them. In this lesson we will cover the basics of Bollinger bands and one particular technique which I have found to be very reliable.

Bollinger Band History

Bollinger Bands were invented by John Bollinger as a means of determining what could be considered as high or low around a give price.

The bands are plotted at a standard deviation (statistical term for measuring volatility) around a moving average. Typically the standard deviation used is 2.

The bands appear on charts as 3 bands.

A simple moving average in the middle. Most charting software defaults to a 20 period moving average.

An upper band calculated around a simple moving average plus 2 standard deviations.

A lower band calculated around a simple moving average minus 2 standard deviations.
For our examples we will use the most common setting of a 20 period simple moving average. This will give us 3 bands, the middle band of a 20 period simple moving average and the upper and lower bands calculated around the middle band with standard deviation of 2. The closing price is most commonly used to calculate the moving average.
Bollinger bands can be used to generate buy and sell signals but that is not their primary use. The main purpose of the bands are to:

To identify areas of high and low volatility
To identify periods when prices are at an extreme and possibly ready for a reversal.
To identify a trending market.

The squeeze (tightening) is a period of low volatility and often happens before a big move. It can also help identify potential breakout areas.

Reversal
In conjunction with other indicators you can identify potential reversal points.Trending Following
Although Bollinger bands will not tell you when the trend has started if you combine it with certain indicators they will confirm the trend. It is also easily identifiable visually.My Use Of Bollinger Bands

As I mentioned earlier Bollinger bands are not really meant to be used as a signal generating indicator but in conjunction with another indictors can be very useful.

I like to use Bollinger bands and RSI together to generate possible buy and sell signals or to confirm overbought or oversold areas.
I normally set the RSI at 14 and when it reads over 70 and price is at or pushing through the upper band then I know we are overbought and ready for a reversal. I will either start thinking about shorting the market or if I am already in a long position will start to cover.

When the RSI reads below 30 and price is touching or pushing through the lower band then I know we are oversold and I will either consider buying the market or close existing short positions.

Experiment with the settings until you find the right parameters for the market you are trading. I have found the bands to be effective on all time frames from 5 minutes to monthly bars.

Good Trading

Best Regards
Mark McRae

www.traderssecretcode.com