Every year has about 220 working days and if FOREX trader earns 1% a day he would be able to get over 200% of year interest. And in this case a trader would be solely concentrated on intraday trading for he would never predict the right time to profit.
An intraday trader mostly uses the technical analysis for fundamental factors affect the market on long-term basis. The main intraday approaches are the trend following and support and resistance levels trading. These methods may be used for positional trading as well.
To follow the trend you have to evaluate several charts taking the longer time periods for they can show the perspective better and short-term movement would just confuse you. Having designated the long-term trends you need to analyze the intraday charts. The basic rules for your trading are to buy low at short-term charts if the long-term trend rises and to sell vice versa. These rules allow traders to confidently follow the prices.
This method has more successful deals though it is hard on traders for they assume the breakouts as picks and think they work against the rules.
When trading upon the support and resistance levels a trader has to determine the intraday trend direction. When trend is determined it reveals the support level at trend rises and resistance level at trend falls. When the trend is rising traders should buy when prices get close to the support level and when the trend is falling – close to resistance level. This one is effective but you might not be able to determine the trends and levels directions correctly for trends may rapidly switch their directions. So, manage your risks and losses all the time.
Getting profits from speculations
The currencies rates mutual changes are the real chances to profit.
The exotic currencies rates vary greatly and Euro against USD may vary only by 1% a day, for example.
Often, you would see such pairs on the market EUR/USD, EUR/GBP, USD/CAD, USD/JPY, EUR/JPY and GBP/USD. Still, the traders are not recommended to use over 3-4 currencies as they won’t be able to keep an eye on lots of changing rates. Also, the beginners should never work with exotic currencies for they are not liquid and their spread may reach 200 points and standard pairs have spreads not exceeding 2-4 points.
Ok, the bank opens a trading account providing a trader with a credit exceeding his deposit by 100 times. So, even with slight market changes you are able to get a profit equal to tenth part of a percent.
Though only a big investor may use 1:100 credit shoulder for he is always at his PC. It’s better to operate with shoulder not exceeding 1:30. Again, always use the stop orders allowing you to fix a profit or limit a loss.
The bank never gets any fee for supporting the deals for it profits on difference between the market quotes and the price of currency for a single client.
The bank also deducts 13% profit tax enabling the client not to make a tax declaration. So, the bank also works as the investor’s tax agent.
The selection of a foreign currency trading service is not an easy task. And one shouldn’t hurry up to make a decision on such a service.
It is very important that you follow a final piece of advice – today the online technologies give you a really unique chance to choose what you require at the best terms which are available on the market. Funny, but most of the people don’t use this chance. In real life it means that you should use all the tools of today to get any foreign currency trading information that you need.
Search Google and other search engines. Visit social networks and have a look on the accounts that are relevant to your topic. Go to the niche forums and participate in the discussion. All this will help you to build up a true vision of this market. Thus, giving you a real chance to make a wise and nicely balanced decision.
And also sign up to the RSS feed on this blog, because we will everything possible to keep updating this blog with new publications about the topic of foreign currency trading companies and important trends on the currency exchange market.
What is that widely known but still a “secret” place in Internet called FOREX?
Any web search would give you an answer as the worldwide web got lots of information on that. Summarizing all ideas we might define FOREX as the mean of profiting for everyone interested in independence, success and the life progress.
The companies providing FOREX access as well as many others offer the courses for FOREX trading skills development. Learning is essential for beginners so should never be ignored. You need to choose a high quality education to have the results (i.e. profits) in nearest future.
So, this education may be paid for and free. The distance learning is widely used here for trading is also performed via Internet. Still, some people choose the full-time education and attend different seminars getting the complete knowledge of FOREX.
The distance learning is about learning in time suitable for you as you receive a set of lessons you go by on your own. This set is being sent in parts accompanied by various tasks following the course tests. In time of your learning you may ask the specialists but the free courses provide you with just basic skills and contain no additional consultations.
After your education you would never receive a guarantee of immediate FOREX profiting for even if you go through several courses it might not bring the desired results. In this case it’s better to pick the most high quality education course from those companies who are experienced and have a good teaching reputation. To success in trading you have to constantly practice and educate yourself. When you learn on daily basis it won’t be too hard to trade for you. You just need to make your deals thoughtfully and sequentially.
As modern book stores provide lots of literature on FOREX every investor regardless of his trading experience has to educate himself by reading the books on trading. Russia entered FOREX only in late 90s that’s why the majority of books is written by the overseas authors and translated in Russian. Surely, some books of Russian authors appear that teach the trading basics, philosophy and various tactics. Some books are considered to be the classics and are widely used at seminars and FOREX study courses.
Presently, we have lots of electronic books that are being freely distributed via Internet. To be able to read any of them you just have to click on “Download”. Still, this distribution is illegal for any book has copyright. So, every respectable investor may purchase these books legally either through the Internet shop or at regular book store.
Reading the FOREX books in English (i.e. the original language) is said to be the most effective way. And to do so you have to have a pre-intermediate English level. If it does not work than you can use the book’s translation.
The experienced investors would advise to read the books not only on trading but also on topics that seem to have no relation to FOREX such as philosophy, psychology and others
The selection of a foreign currency trading service is not an easy task. And one shouldn’t dash to make a decision on such a service.
It is very important that you follow some general tips – today the Internet technologies give you a truly unique chance to choose what you require for the best price on the market. Strange, but most of the people don’t use this opportunity. In real life it means that you should use all the tools of today to get any foreign currency trading info that you need.
Search Google or other search engines. Visit social networks and check the accounts that are relevant to your topic. Go to the niche forums and participate in the online discussion. All this will help you to create a true vision of this market. Thus, giving you a real chance to make a wise and nicely balanced decision.
P.S. And also sign up to the RSS feed on this blog, because we will everything possible to keep updating this blog with new publications about the topic of learn foreign currency trading and important trends on the currency exchange market.
Playing at FOREX international currencies exchange
To become a FOREX player you have to sign a contract with some company that provides the access to trading areas and have to have some capital. It’s easy to become a financial market player but it’s hard to succeed. The professionals recommend playing with virtual account before opening the real one.
The FOREX is about buying and selling different countries currencies to profit from differences in rates. This trading is performed 24 hours a day and the currency traders are able to react to situations affecting the rates faster than the stock market players.
How to enter FOREX
First, chose a bank or investing company providing the access to trading areas and opening a broker’s account. You can open such account via Internet or by visiting such company office.
You may trade with your trader but most people prefer to play on their own.
The opening of FOREX account implies the player’s registration and getting an access code to his personal page. The next step is submitting the client’s application which is a base for opening deposit for certain player’s amount.
Though the trading process is virtual it acts with real money. The investing company loans the player by amount 10s times more than his own money and the game is played for loaned money that come back to company in a form of commission on deals.
The deals are finished when a trader’s losses become equal to his deposit. In case of winning the player is able to take his profit out of deposit at any time notifying the dealing company that receives its commission for that.
Usually the investing companies allow the trader to play with demo account where he would be able to practice without losses. Though it works as real one it does not have the time gap of 30-40 seconds and the real world the rates may be changed at that time.
Still, even being experienced a FOREX trader may not close the rising rate and lose his money so you always need to be able to stop.
FOREX as an intellectual casino
To work at FOREX you need to have an intuition accompanied by tested trading scheme, i.e. you need to know when to buy/sell and what factors might prevent you from making deals.
FOREX may be affected by any news forcing the players to act. Also traders need to use the technical analysis. Some traders make deals right after the news and some wait for the rates’ stabilization. The charts of rates may help you to predict the currency dynamics and detect the right time to deal with it.
Make your own trading system as others’ experience never guarantees the success. The trading system effectiveness may be analyzed by the ratio of successful to busted deals. If it is 60:40 than your system is good enough. The beginners should never deal with big amounts until their systems are not tested for couple months and also never use the whole deposit for the 10th part of it would be enough to trade.
The choice of a foreign currency trading service is not an easy task. And one shouldn’t hurry up to make a decision on such a service.
It is very important that you follow some general tips – today the online technologies give you a truly unique chance to choose exactly what you want at the best terms which are available on the market. Funny, but most of the people don’t use this chance. In real practice it means that you should use all the tools of today to get any foreign currency trading information that you need.
Search Google and other search engines. Visit social networks and have a look on the accounts that are relevant to your topic. Go to the niche forums and join the online discussion. All this will help you to create a true vision of this market. Thus, giving you a real chance to make a wise and nicely balanced decision.
P.S. And also sign up to the RSS feed on this blog, because we will everything possible to keep updating this blog with new publications about the topic of foreign currency trading companies and important trends on the currency exchange market.
The money can be sold…
The money is a good that can be bought and sold. Today there’s no need to set contracts with international companies, to search for partners and persuade them in cooperation and to spend on insurances and transportation. You also don’t need to search for market niche and spend money for advertising as well as for storing your good.
Gosh, the scheme is awful: customs services, bribes, fees and taxes with thousands of obstacles at every step!
The money is a good that is real and ideal by all parameters. It would never spoil or demand any storage. It moves immediately and is always demanded without custom services and fees and taxes of any kind. It always has a specified price and hidden from the competitors.
The hardest part about it is to realize the money is a good. If you can go with it than your mind is not ready and you better sell drinks, chocolate of pampers. Sorry, but this business you won’t handle. Just as you understand the money is a good than start dealing on it.
You business would also have great advantages over the other trading and your chances for profit would be times more than those who sells other goods. Learn to sell and buy in a right way and the world would kneel to you. All you need to do is to get the scheme of buying cheaper and selling more expensive. Your main interest now is how to buy some currency for another one giving less and getting more after selling it.
All currencies are quoted in pairs one against another. So, we buy when some currency is cheaper than the one we pay with and we sell it when its price rises. Sounds simple? It sure does. The rest of it is to get to know when it would be the right time to buy and the right time to sell. The technical and visual charts analyses are designed just for that.
The FOREX to retirement relation
Often the traders are thought to search for quick and easy profits. Let’s compare the work of trader to any other specialist working for salary. With every year such specialist comes closer and closer to his retirement and its amount would be determined not by years worked but by the investments he made in his lifetime.
In nearest future the retirement situation would become more problematic. The birth rate is thought to decrease so the amount of working people and sources for retirement funds would decrease respectively. See, pretty soon one working person would have about 20 on retirement he would have to donate to.
In this case there’s no reason to count on the government and many people bet FOREX would provide their retirement.
The ways you can save the money for your older ages:
1. Non-governmental retirement insurance
As we see more and more such funds appearing we have to understand the most of them are just frauds.
2. Shares
Connection to such exchanges may lead to big losses and in relation to capital management is really time consumed
3. Real estate investing
You just need to have big money to start
4. Entrepreneurship
All risks and profits are dependable on your personal skills
So, after having evaluated all of the above many people chose FOREX still keeping in mind it is a hard and thorough work.
The selection of a foreign currency trading service is not an easy task. And one shouldn’t hurry up to make a decision on such a service.
It is very important that you follow a final piece of advice – today the Internet technologies give you a truly unique chance to choose exactly what you require for the best price on the market. Strange, but most of the people don’t use this chance. In real life it means that you should use all the tools of today to get any foreign currency trading info that you need.
Search Google or other search engines. Visit social networks and have a look on the accounts that are relevant to your topic. Go to the niche forums and join the online discussion. All this will help you to create a true vision of this market. Thus, giving you a real opportunity to make a wise and nicely balanced decision.
And also sign up to the RSS on this blog, because we will do the best to keep this blog tuned up to the day with new publications about the topic of learn foreign currency trading and important trends on the currency exchange market.
Why is it hard to trade at FOREX?
FOREX trading might seem easy: you need to pick the effective trading system that would allow you to earn more than lose and then using trade indicators you may buy and sell with the right software. That is it!
Numerous authors of FOREX books tell about their methods that allowed them to profit so much to even quit their jobs. So, every beginner wants to purchase the newest trading system, invest in new benefiting possibility increasing their capitals picturing their reach lives thanks to virtual trading and real earnings.
Most beginners dream of that and still 90% of traders lose all their investments (it usually happens for the first 6 months). Why it happens? Why the reality does not match the expectations?
See, to achieve high results you have to work a lot to get an experience and skills that come with time. You have to be highly disciplined and have a clear mind.
Your success does not depend on the system you chose. The trading system may help you to solve some questions but never to solve all the problems. What suits one trader doesn’t work for another for everybody have different trading methods.
The beginning trader must develop his own approach based on his knowledge and beliefs that would help him to control the risks and manage the investments. With own discipline a trader may successfully manage the trading process and himself as well. Often the inability to “get the brains together” leads to people leaving their undertakings. The market situations develop in people greed and fear that should always be controlled.
When you start trading at the market you have to take into account “both sides of the coin”. Besides profiting you always may suffer the losses so you have to be ready for that and realize that it might happen. The success should be earned by hard work and easy money won’t stay in your pocket to long. Sometimes the years pass before you start having essential results. If you are confident, never panic because of your losses and work hard all the time you are going to be successful!
What makes FOREX so popular? Let’s ask those who participate in other side of business and whose opinion is extremely worthy for the beginning traders.
Erick Nyman, the author of books for traders, thinks its high popularity is conditioned by the potential profitability, suitable work schedule and relative easiness to be profitable (pay attention to lead analysts’ recommendations, know the news about the shares rates, etc.) Nyman thinks those reasons to be the basic one adding the publicity in countries of ex-USSR as FOREX was introduced there in 1995 and stock markets came later.
The expectations of fast profits, advertisement and successful traders’ experience enroll many newcomers to FOREX. Still, the advertisements give just a general overview as only the active traders are able to say how much you can earn. The newcomers face many obstacles as they cannot evaluate the situation because of adrenalin and desire to earn a lot on constant basis. Still, learning many analytical theories they become able to develop their own profitable strategies.
The selection of a foreign currency trading service is not an easy task. And one shouldn’t hurry up to make a decision on such a service.
It is very important that you follow some general tips – today the Internet technologies give you a truly unique chance to choose exactly what you want at the best terms which are available on the market. Funny, but most of the people don’t use this opportunity. In real practice it means that you should use all the tools of today to get any foreign currency trading information that you need.
Search Google or other search engines. Visit social networks and check the accounts that are relevant to your topic. Go to the niche forums and join the online discussion. All this will help you to build up a true vision of this market. Thus, giving you a real chance to make a wise and nicely balanced decision.
And also sign up to the RSS feed on this blog, because we will do the best to keep updating this blog with new publications about the topic of learn foreign currency trading and important trends on the currency exchange market.
The trading laws and experienced players advices
The law of probability. Sooner or later the price should either rise or fall and all oscillators work based on it.
The law of occasion. You can never be sure of what would happen next so you have to be prepared to any turn – either big profit or big loss. When do your market calculations make certain corrections to them for any occasions.
The law of meanness. Just when you calculated everything and are 100% sure in your profits and make a deal someone completely messes the game rules. Always consider that as the rules may rapidly change anytime.
The law of optimism. People love to overestimate their chances to success. This dangerous trait of your mind may force you to go with risky and suspicious deals. You are your own worst enemy on the market. So, be aware of yourself!
The law of time. Here’s how it is formulated: “The longer you are out of the market the bigger your desire to conclude a deal.” It means that long staying out of the market harms your effective prices evaluation and makes you striving to deal no matter what. Big part of your losses is connected to the lack of patience. So, learn to wait and be patient.
The cause and consequence law. When you notice some movement try to find the cause of it. If you don’t have complete understanding of why the rates changed to one side or the other than you should stay out of making deals for there’s no movement without a reason.
The experienced players’ advices:
-Never work opposite to the trend.
-The good humor is a key to success.
-Think twice before making a deal.
-Learn to wait
-Fear yourself (impatient, greedy, etc.).
-Don’t be greedy for it’s better to have a little for sure than a lot for maybe.
-Never regret amounts you didn’t earn.
-Never let your insufficient losses become essential. Also, never relax when everything goes right.
-If you lose deal by deal than take a break. Learn to rejoice your losses and be upset with your victories (just never do it excessively).
Playing with nerves
After several successful deals a trader may somewhere lose his concentration and trusting his intuition may get broke completely for in this case a trader would try to make it up.
Here might be a big mistake in risking with the whole capital with a deal that might make you go bankrupt. People enter the currency exchange to earn at first place but many people get so deep into the game that stay in the market for the sake of process and not of the result. Some investors wait for chances to earn constantly losing their money from trading accounts because of unlucky deals. Even the professional players sooner or later lose parts of their capitals or all money on currency market but very limited number of them feels to go back to FOREX after that. The experts advise to take the FOREX activities as serious intellectual actions where all the emotions have to be put behind for the brain may just not handle the excitement.
The psychologists classify the players by their tactics and strategies determining three types: intellectual, intuitive and instinctive one.
The data reveals that only 20% of traders may be successful and the rest of them have no chances from the start.
The selection of a foreign currency trading service is not an easy task. And one shouldn’t dash to make a decision on such a service.
It is very important that you follow some general tips – today the Internet technologies give you a really unique chance to choose what you want at the best terms which are available on the market. Strange, but most of the people don’t use this chance. In real practice it means that you should use all the tools of today to get any foreign currency trading info that you need.
Search Google or other search engines. Visit social networks and check the accounts that are relevant to your topic. Go to the niche forums and participate in the discussion. All this will help you to create a true vision of this market. Thus, giving you a real chance to make a smart and nicely balanced decision.
And also sign up to the RSS feed on this blog, because we will everything possible to keep this blog tuned up to the day with new publications about the topic of foreign currency trading companies and important trends on the currency exchange market.
The futures and the options
Modern futures markets derive from Japanese rise future contracts originated in the middle of XVIII century. In USA that recently has the most futures deals futures grain contracts received their demand in the middle of XIX century in Chicago. Presently, the derivative financial instruments trading (including futures and options) is the world leader financial industry by volume as contracts for variety of goods, financial instruments, currencies and indexes are being traded. And the specter of available markets increases year by year.
The futures contract is a standard agreement reached by two parties obliging one party to sell and the other party to buy the specified amount of goods at specified price by specified date in future. By “good” we presume the wide range of actives: currencies, bonds, stock indexes of largest world economies (S&P, Dow Jones, FTSE, DAX) and goods (oil, gas), as well as metals (precious and industrial ones) and agricultural derivatives (grain, soy, coffee, wood, etc.)
Futures contracts can be delivery and non-delivery. You can close the delivery contract either by delivering goods or by signing the opposite contract (off-set deal). It means that closing of non-delivery contract is possible only with signing an opposite deal. The market cost of futures contract directly depends on current supply and demand for when you have more buyers than sellers the price would increase introducing new sellers to the market until the amount of buyers and sellers is balanced again.
The option for futures contract unlike the contract itself offers not an obligation but the right to buy or sell the futures at the execution price before the preset date (or at the date) with paying the certain premium for that.
All participants of derivatives market may be split up into speculators and hedgers.
The speculators try to profit from the changes of goods’ prices in time as the nature of futures trading (the starting and supporting margins concept) provides the possibility to work (and control) with big capitals having relatively small deposits on brokers’ accounts. For example, having $3000 deposit you are able to buy/sell 125000 Euro, gold for $50000 and oil for $45000. Still with futures you are able to profit with rising and decreasing markets as well and it attracts lots of risk investments. The derivative markets are the ones of the most liquid markets in the world decreasing a trader’s transaction costs and providing easily opened/closed positions.
The hedgers, unlike the speculators, use financial derivatives markets to minimize the risks of their base activities. Hedging presumes the knowledge of futures positions opposite to ones on the spot-market, i.e. the air company to control the fuel prices rise should hold a long position on it. Presently, the hedging risk management is widely used by small enterprises and international corporations.
Futures and options trading advantages
-Variety of tools for many markets available from single trading account
-Marginal trading
-Deals clearness and legal support
Besides the futures and options markets may be more attractive for traders because of their high volatility.
The choice of a foreign currency trading service is not an easy task. And one shouldn’t dash to make a decision on such a service.
It is very important that you follow some general tips – today the web technologies give you a really unique chance to choose what you want for the best price on the market. Funny, but most of the people don’t use this chance. In real life it means that you should use all the tools of today to get any foreign currency trading information that you need.
Search Google and other search engines. Visit social networks and check the accounts that are relevant to your topic. Go to the niche forums and join the discussion. All this will help you to build up a true vision of this market. Thus, giving you a real chance to make a wise and nicely balanced decision.
And also sign up to the RSS on this blog, because we will do the best to keep this blog tuned up to the day with new publications about the topic of learn foreign currency trading and important trends on the currency exchange market.
Methods of FOREX analysis
To start working at FOREX you have to understand what moves the market and what are the essential factors affecting the currencies quotes for any of them can cause the market rapid change.
The prices moves imply the possibilities of rapid profiting and the same rapid losing. So, the right market movement forecasting, evaluation of situations and rumors and expectations manipulating are the key factors of brokers’ and dealers’ success. Lots of factors affect the currency exchange as a whole and certain currency.
You can analyze the market by 2 methods – fundamental and technical. First implies the situations evaluation based on politics, economy and financial and credit policies. The second is based on charts and mathematical analysis.
Fundamental analysis
The fundamental factors are the basic macroeconomics indicators of national economies that affect the currency exchange participants and levels of currency rates. Knowing the dates and times of economic publications you can easily get them via Internet.
For currency exchange fundamental analysis as for any stock or goods market analysis people use the special analytical overviews and charts and tables of value indicators.
Fundamental factors affecting currency rates:
Economy growth indicators
Trade balance state and level of external sources dependence
Growth of monetary volume at internal market
Inflation level and expectations
Interest rates levels
The country’s pay ability and level of trust to national currency at world market
Currency exchange speculations
The level of development of other world financial market sectors (e.g. secured loans) competing with currency exchange
It’s hard to do the fundamental analysis for the same factors in different cases may unequally affect the market or turn into insufficient one from essential. So, the trader’s success basically depends on knowledge and understanding the financial markets rules and ability to correlate even the insufficient situations.
Technical analysis
The majority of small and mid-level financial markets players use technical analysis.
The basic tools of this analysis are the charts of currencies price changes at specific time periods preceding the deals and technical indicators obtained by mathematical processing of mean and other price movements characteristics. The technical analysis tools are universal and may be used with any financial markets tools, any currencies and any time periods. They may be used by all FOREX players regardless of their trading plans, strategies and deals durations. Presently, the technical analysis is performed with computer which is important as tools for technical analysis become more and more complicated.
Basically, the technical analysis is a statistics and mathematics analysis of preceding quotes with further prices forecasting.
Regardless to differences in approaches the fundamental and technical analysis are the mutually supplementing systems. Those acting based on fundamental analysis still have to take into account the certain market technical characteristics (the basic levels of support and resistance and overbuying and overselling levels) and those who use the technical analysis evaluate the latest news (interest rates and important political events).
The choice of a foreign currency trading service is not an easy task. And one shouldn’t dash to make a decision on such a service.
It is very important that you follow some general tips – today the online technologies give you a truly unique chance to choose exactly what you want for the best price on the market. Funny, but most of the people don’t use this opportunity. In real life it means that you should use all the tools of today to get any foreign currency trading information that you need.
Search Google and other search engines. Visit social networks and have a look on the accounts that are relevant to your topic. Go to the niche forums and participate in the online discussion. All this will help you to create a true vision of this market. Thus, giving you a real chance to make a smart and nicely balanced decision.
And also sign up to the RSS on this blog, because we will everything possible to keep updating this blog with new publications about the topic of foreign currency trading for dummies and important trends on the currency exchange market.
The FOREX trading strategies and 7 basic rules
Working with right trading strategy is critical for successful FOREX traders. The strategies based on fundamental and technical analysis mix eliminate profits at big time scales. The key to FOREX big profits is in identification of big trends at right time.
Today the exchange participants have several analytical tools that are able to forecast the market movement. To understand and be able to use these tools is essential for beginning traders. You have to have a good knowledge of basic notions to be able to use the successful strategies.
The prices trend keeps moving until it breaks the support or resistance level. Every time a currency breaks the resistance level the price would still rise for some time. The same as when a currency breaks the support level the price would still decrease for some time. If you can detect it at the right time than the luck “would turn its face to you” resulting in big profits.
FOREX has several internal and external factors affecting the trend changes. To identify that you need to be aware of all major factors and to understand that they depend on general and technical reports.
The charts analysis is one of the most reliable ways to detect a trend at the right time. To determine support and resistance levels you have to analyze the prices chart at several time intervals. The longer the chart and the longer intervals it has the more trustworthy your analysis would be. Traders then use these levels to take a decision on specific currencies buy and sell operations.
The mean values analysis and shifting is another trend identification general method. The mean values shifting provide you with better overview of changes in prices as this eliminates the short price waves in time periods. If the price moves over the mean shifted value it might go to the next level. And if the price is lower than it would need some more time to pass.
7 FOREX unbeatable trading rules
Rule #1. Never risk with bigger amounts than you may easily lose as you might lose all your money. All experienced traders insist that you may never “put everything on last card”.
Rule #2. Never risk with amounts bigger than 2% of your trade account. It’s different for mini-trading. Say you’ve got $300 on your account but you need to risk with close to $15. Well, go for it but as your account grows limit yourself with 2% risks.
Rule #3. Always set stop-losses. If it is unclear where to put the stop-loss don’t make a deal.
Rule #4. Before you enter you have to know your exit point.
Rule #5. Before you open a real account become a successful trader with virtual one.
Rule #6. If your share “jumps in water” take a break.
Rule #7. Don’t let your emotions to rule over your mind and actions. You can beat the system only with clear mind and patience.
The choice of a foreign currency trading service is not an easy task. And one shouldn’t dash to make a decision on such a service.
It is very important that you follow a final piece of advice – today the online technologies give you a truly unique chance to choose exactly what you require at the best terms which are available on the market. Funny, but most of the people don’t use this chance. In real life it means that you should use all the tools of today to get any foreign currency trading information that you need.
Search Google or other search engines. Visit social networks and have a look on the accounts that are relevant to your topic. Go to the niche forums and participate in the online discussion. All this will help you to create a true vision of this market. Thus, giving you a real chance to make a wise and nicely balanced decision.
And also sign up to the RSS feed on this blog, because we will do the best to keep this blog tuned up to the day with new publications about the topic of foreign currency trading for dummies and important trends on the currency exchange market.
The traders: mistakes and advices
Unfortunately, most traders are often get caught by the same traps that could be avoided when followed certain rules. So, let’s discuss them now.
1.Buying on top
Most traders open their positions when they have to be closed. By Elliot’s theory it’s a moment of 3rd and 5th waves ending. You would surely have some chances to get the big tip but the risks are greater. Resulting such actions a trader gets a little profit but promptly the rates move down and a trader suffers losses. To avoid that always remember:
-if the volumes increase and the rates are on top of the market and prices don’t rise than you should never buy;
-buy only at the market that is growing and volume supported and in case there was a resistance level breakout;
-to every buy there’s a sell where a trader finishes his long deal or enters in short position;
-the currency prices and volumes always make trajectories characterized by same direction.
2. Selling at base
It’s also a frequent mistake. It is a reverberation of previous one for here we have a mix of volume increase and rates decrease. People may lose lots of money on that for with short position you may not hold the market growth. So, remember:
- if the volume grows and prices are at the market base you should never sell. Use it when all support levels are broke and there’s no predisposition for prices drop;
-sell only at the market that is going down and is supported by volume and in case of support levels breakout.
Trading advices
1. A trader should never play against the market
As currency exchange is characterized by rates movement directions you should learn the market “mood” and open most positions towards priority trends.
2. Follow the strategies and not picks
Basically, you should buy at the base and sell on top but to enter the market you have to first understand its high and low sides. Beginners should first learn the market “mood” and then try to get the top and bottom sides of current trend. If you predict the other players’ expectations you would have success.
3. Trader must “give birth” to every decision
Trader should act only according to his plan and be disciplined. If you think you may not control the situation than fix all previously opened positions as chaos may bring you losses. Before you enter you should analyze the market, set all necessary levels and watch the trend development until it matches your assumptions.
4. Equalize take profits with stop losses.
These two are essential as they can regulate your losses. Any beginner noticing some profit takes it right away but may not close his loss position hoping the trend would go to needed side. As the result the loss of capital occurs in early stages. When market start opposite side movement close your loss positions if it is not beyond the logical reasoning.
The selection of a foreign currency trading service is not an easy task. And one shouldn’t dash to make a decision on such a service.
It is very important that you follow a final piece of advice – today the online technologies give you a really unique chance to choose what you need for the best price on the market. Strange, but most of the people don’t use this chance. In real life it means that you should use all the tools of today to get any foreign currency trading information that you need.
Search Google and other search engines. Visit social networks and check the accounts that are relevant to your topic. Go to the niche forums and participate in the online discussion. All this will help you to build up a true vision of this market. Thus, giving you a real chance to make a smart and nicely balanced decision.
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