Browsing Archive: August, 2009
Posted by Forex Trader on Saturday, August 29, 2009,
Forex is a big market to participate in and surprisingly only the top 5% are making money. That means the remaining 95% of traders are either breaking even or losing money. The small minority at the top in this business have their own hidden techniques and strategies that they use to profit. I hope to give you a glimpse into what they do. The expert trader also knows when it is appropriate to drop the training wheels, which happen to be the demo platforms. I’m not saying demos are bad becaus... Continue reading ...
Byuing and Selling Currencies
Posted by Forex Trading on Saturday, August 29, 2009,
Top 10 Forex Trading Tricks: You Won’t Lose
Posted by Forex Trader on Saturday, August 29, 2009,
The foreign exchange market or forex is the
largest and most liquid markets in the world. Its growing popularity
can be seen by the whooping $2 trillion trades a day. While
the forex can be an extremely lucrative market, it can also
be somewhat complicated. These ten tricks will help insure
trading success in the foreign exchange market.
First, make sure you implement
... Continue reading ...
Psychology of the Trader
Posted by Forex Trader on Friday, August 28, 2009,
What should the psychology of the trader be?
Before placing trades, traders must sufficiently
analyze the position they are about to take. However, many do not
thoroughly plan out their actions, and instead make trades based on
guesses and hunches. This psychological viewpoint can result in traders
losing a
lot
of money very fast. How can this be avoided? Through careful planning
and analyses, including where to place stop and limit orders, a trader
can keep losses to a minimum while allowing... Continue reading ...
Risk Management
Posted by Forex Trader on Friday, August 28, 2009,
There are three basic questions that every trader should answer BEFORE entering a trade.
How much do I believe the market will move and where do I want to take my profit?
Limit Orders allow traders to exit the market at profit targets. If you
are short (sold) the system will only allow you to place a Limit Order
below the current market price because this is the profit zone.
Similarly, if you are long (bought) the system will only allow you to
place a limit order above the current market p... Continue reading ...
Support and Resistance
Posted by Forex Trader on Friday, August 28, 2009,
Support
and Resistance
At the core of all technical
analysis th... Continue reading ...
Technical Analysis
Posted by Forex Trader on Friday, August 28, 2009,
What is so great about technical
analysis?
Once a trader masters
t... Continue reading ...
Currency Pair Relations
Posted by Forex Trader on Friday, August 28, 2009,
EUR/USD
When the dollar
weakens... Continue reading ...
Fundamental Analysis
Posted by Forex Trader on Friday, August 28, 2009,
What influences prices in the forex market?
Prices
in the currencies market are affected by macroeconomic factors, such as
inflation, unemployment, and industrial production. Information on
events such as these is easy to find and are based on their analysis of
economic data, which traders take positions on the market to make
profit.
There are three main macroeconomic factors a trader should focus on when analyzing foreign exchange rates:
Interest Rates: Each
currency has an overnight len... Continue reading ...
Trading Costs
Posted by Forex Trader on Friday, August 28, 2009,
How much does it cost for a trader to make a trade?
Traders
do not take positions on a currency pair at the exact rate at which the
currencies are trading. Instead, there are two rates for the currency
pair: the bid rate and the ask rate.
• The bid rate is the price at which traders can Bid the pair.
• The ask rate is the price at which traders can Ask the pair.
This
is an example of a currency pair. The ask (Ask) rate is higher than the
bid (Bid) rate and the spread is 3 pips, mea... Continue reading ...
Concept of Leverage
Posted by Forex Trader on Friday, August 28, 2009,
What is leverage?
Leverage
allows traders to borrow money and use that money to invest in the
foreign exchange market. Because of leverage, clients without a huge
amount of capital are able to make large investments, whereas in other
markets such as the equities market, clients would have to pay 50% of
the full amount for each share of stock they were investing in. Most
market makers allow positions to be leveraged up to 100:1. This means
that if a trader wanted to Ask a “lot” worth $100... Continue reading ...
Currency Pairs
Posted by Forex Trader on Friday, August 28, 2009,
What is the significance of currency pairs?
A
currency pair represents the exchange rate between the two currencies.
For example, the rate at which the EUR/USD is trading that represents
the number of US Dollars one Euro can purchase. The first currency is
called the base currency and the second currency is called the counter
currency.
An example of how
currency pairs trade is if a trader believes the Bank of Japan will
intervene to cause a decrease in the Yen against the US Dollar, then
t... Continue reading ...
Basic Concepts of Forex
Posted by Forex Trader on Friday, August 28, 2009,
Currencies
are quoted in pairs, such as EUR/USD or USD/JPY. The first listed
currency is known as the base currency, while the second currency is
called the counter or quote currency. The base currency is the “basis”
for the Ask or the Bid. For example, if you Ask EUR/USD you have bought
Euros (and simultaneously sold dollars). You would do so in expectation
that the Euro will appreciate (go up) relative to the US dollar. FX is
traded in lots, which represent 100,000 units of the base cur... Continue reading ...
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