Is Forex Right For You?

The Foreign Exchange Market (also known as Forex )

The size of Forex has now made any other investment market smaller to a great extent. It is becoming more and more popular every day.

Forex traders can make exchanges 24 hours a day 5 days a week, from Monday to Friday. There are many opportunities for the forex trader in the Forex market because of the constant movements of the exchange rates.

Traders can make profits both when the prices are high and low. Anyone can learn how to trade on the market. But it is very important to get the proper training and education before you start doing any live trading. The good thing is that anyone can practice with a demo account before starting any live trading. The good thing is the amount of money someone needs to place a trade is all that they can lose. Unlike other markets it is possible to start trading with only $100.

The transaction cost is very low and the market is the most liquid of all markets, so the trader can enter or exit it in almost any condition. Because of the forex market's twenty 24 hours trading, Orders are processed quickly without slippage. It is easy to find good brokers, with a little research who will close some or all of open positions if the account's fall below the level required to hold the positions. Everybody can trade online from home. It is a great opportunity for people who want to work from home, All that is needed to start trading is a computer with Internet access and a proper training.

The market is so huge in forex that it is impossible for anyone to control the market price for a long time. Trading currencies is much simpler than stocks. There are only a few major currency pairs. There is no waiting for months like in futures market. Trades in forex rarely take more than two days. The huge marketplace will grow bigger as more people are joining it every day.

Forex Day Trading - The Most Important Fact You Need to Know

If you are considering forex day trading, there is one fact you need to know above all others and its enclosed in this article.

The fact is that if you try it the odds are you will lose your money and lose it quickly.

Why?

Because all volatility within such a short space as a day is random and support and resistance levels are meaningless and you will may as well flip a coin. Of course if you think about it its obvious why:

You have millions of traders trading trillions of dollars each day and this mass of people and what they do cannot be measured in such a short time span as a day or less.

You will see a lot of day trading systems on the net and they all claim to make money - but there is a problem - none of them do, because none of them have been traded.

They all produce a track record in hindsight knowing the closing prices!

Well that's hard - if we all knew tomorrows price today we would all be rich but forex trading is not that simple. Whenever you see a day trading or forex scalping system with a track record look at the disclaimer and you will normally see the one below or a similar one:

"cftc rule 4.41 - hypothetical or simulated performance results have certain limitations. unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown".

Of course if you put this disclaimer on you can say anything you like and many vendors do. They know the system wont make money (that's why they have the good sense to not trade it themselves) better to sell it and make a guaranteed income by appealing to naive and greedy investors.

Day trading is a good story but that's all it is and it doesn't work in practice. I quite like Harry Potter as a story but I don't think I can fly!

If you want to make money in forex trading understand one key point:

You need to use data that allows you to calculate the odds and that means swing trading or long term trend following - where the data can be used to help you time your trading signal and enjoy long term currency trading success.

If you want to day trade the odds are not on your side and you will lose and if you don't believe me try and find a day trading system with a track record audited of trades and profit and loss and you simply won't get one.

How to Find Time to Trade the Forex

Have an interest in trading the forex market? However you feel you may not have the necessary time.

Here are the three biggest myths about the amount of time it takes to learn and then trade the forex:

1. You have to spend countless hours in front of your computer.

Nothing could be farther from the truth. In fact a primary reason trader's fail is because they spend to much time watching the market. Being glued to your computer is a bad thing. You read into things and make poor decisions.

One cardinal rule to follow, "plan your trade, trade your plan." All it takes is blocking out 30-45 minutes each day. This could be in the morning, afternoon or night. At a convenient time, use a planning worksheet to create a trading plan. Once this is done you can set an alarm on your trading platform that will email you or send you a text message alerting you to a potential trading opportunity.

2. I presently work so I cannot pursue the training process.

First, select the correct training environment. Look for programs that offer unlimited access. This means you can pursue the training at your own pace. When developing any new skill it is best to commit just a couple of hours per day 2-3 days per week. The individuals who overdo it and pursue an intensive crash course style of training always run into problems.

Statistically, the individuals who are currently working while pursuing a training process to learn how to trade do better because they approach the training process in a conservative fashion.

Secondly, look for training that is online. Classroom training with a fixed schedule is archaic. Online training allows you to have 7 day a week 24 hour a day to access via an online learning center. Unlimited access means a flexible training process tailored to your schedule.

3. Because of my job I need to trade on a large time frame.

Keep in mind the forex is open 5 days a week 24 hours a day. It has incredible volatility. Most individual traders get slaughtered trying to stay in this market for an extended period of time trading on large time frames (30 minutes or greater).

Here is the reality. Once you are in the market, as the hours pass the concern for your trade creates so much anxiety that you continually need to check on it throughout that time. Result: lost sleep, distracted at work. This particular myth is why so many fail.

Select a trading methodology that allows you to be in and out of the market in most cases in under an hour. Imagine this scenario. You create your plan at your own convenience. Hours later you receive a text message alerting you to a potential money making opportunity. You go online, set your trading order, 40-60 minutes later the trade is done. Profit achieved!

No lost sleep. No distractions while you are working. The reality is that trading on a small time frame works best for a working individual. It is the person with time on their hands that can trade on larger time frames. Here is another reality. Most people find they do not want to be in the market for extended periods of time because of the anxiety involved.

Forex Trading Using Technical Analysis

Technical analysis is the interpretation of price action through the use of charts and indicators.

Indicators have a very specific place in trading. The majority of popular indicators do not perform consistently in volatile conditions. There is too much whipsaw or up and down price activity. Because of this, indicators are best used on larger time frames and trading in markets with low volatility.

For this reason many individuals steer away from volatile markets. The reality is volatility is a good thing when traded correctly. Volatility equates to more profit taking opportunities, and the forex is the world's most volatile market. A key feature of the forex market is consistent price swings in very short periods of time. What this means to the trader is frequent short-term profit taking opportunities. It is important to understand this same volatility can get a trader into trouble trying to trade using the incorrect time frame. As one who trades technically based on price, you embrace this volatility. As a technical trader you do not care what the reason is behind this volatility. You just want to be able to understand the movement and, more importantly, take advantage of it.

Technical analysis operates on the theory that price reflects all known factors affecting supply and demand at that time. Hence a price chart is all we need to use to identify good trading opportunities or set-ups.

Markets are a reflection of human emotion. People make and move markets, not balance sheets. So by developing the skill to interpret price action, you develop an understanding of the view of all those trading it.

Price charts tells us what has happened in the past. And since the past tends to repeat itself, it can give us an indication of what might happen in the future.

In fact, technical analysis is the most powerful trading tool an individual can use. And because of this, technical analysis provides the framework for a systematic approach to trading. More importantly, it gives us the confidence to make our trading decisions. And both these aspects are critical for success.

Technical analysis provides precise mechanisms for trade entry and exit. Strategies that are based on technical analysis afford the trader higher probability trading opportunities.

One needs to remember there are countless patterns and strategies that fall under the umbrella of technical analysis. It is important to be trained in how to select the correct strategy to apply to the current market condition you are monitoring as well as the timeframe you are trading on.

INTRO TO FOREX

INTRO TO FOREX

There are millions of people around the globe who trade in foreign exchange. It can be pretty easy or difficult to trade in foreign exchange depending on whether or not you know how to.First of all some facts - Foreign exchange market operates 24 hours a day, 365 days a year. Trade in foreign Exchange is a multi trillion market. Yes, Multi trillion dollars change hands each and every day of the year.So it is really obvious that thousands of people are taking to trade in foreign exchange every day. But it is really surprising that only a few people know how to trade in foreign exchange. This is also a fact that more than 90% of the people who take to trading in foreign exchange lose lots of money because they fail on the first basic principle - They did not invest in learning how to trade in foreign exchange.There are a number of different strategies which you can choose from before deciding on how to trade in foreign exchange. The most important thing is you will need to come up with a strategy that suits you.At the end of the day exactly what strategy you decide to adopt is largely immaterial but, what is important, is that have you a strategy before you start to trade in foreign exchange.Many traders today choose to base their strategy on a technical approach to trading while others prefer to follow a fundamental approach. Both approaches are fine but the truly successful traders will tell you that the real secret lies in not selecting one or the other but in combining the two.Deep technical analysis reveals that prices follow trends and that markets possess clearly identifiable patterns which can be recognized if you know what you are looking for. Both knowledge and experience play an important role in technical analysis but here it is a case of knowledge and experience of not just the patterns in the market but of working with the barrage of tools which are now available.Many people who trade in foreign exchange like to work with what are called support and resistance levels. In this case a support price is a low price to which a currency repeatedly returns, effectively representing the bottom of the market or the price at which it supports the market. By contrast, a resistance price is the high price which a currency reaches from time to time but above which it tends to resist rising.The importance of these two levels is that once a currency price drops below its support level it will commonly continue to fall and, similarly, once the price exceeds its resistance level it will continue to climb.It is also common for many traders to make use of moving averages which show the average price of a currency over a given period of time within a longer period. This is extremely useful for eliminating short term fluctuations in a currency price and producing a clearer picture of the movement of a currency over time.These are of course just the two of the strategies. And there are many more if you want to learn how to trade in foreign exchange. I cannot stress it enough that how important it is to learn to trade in foreign exchange before you dive right in. You will owe it to yourself in the long run

India becomes 5th largest holder of forex reserves

India becomes 5th largest holder of forex reserves

India on Friday joined the elite group of world's five biggest holders of foreign exchange reserves as it added about $4.5 billion last week to take the kitty to $261 billion.

The country surpassed South Korea, which had $257 billion in forex reserves as of September-end, to stand at the fifth spot. While India reports its reserve position every week, South Korea does so on a monthly basis.

China leads the pack with $1,434 billion, followed by Japan ($946 billion), Russia ($440 billion) and Taiwan ($263 billion). According to Reserve Bank's weekly bulletin released today, India's foreign exchange reserves increased by about $4.5 billion during the week ended October 19.

The rate at which the country's foreign exchange kitty is growing, especially after the US housing mortgage crisis, the country will soon overtake Taiwan. Among the BRIC (Brazil, Russia, India and China) countries, Brazil has the lowest foreign exchange reserves of $164 billion, according to the latest IMF data. The other major holders of foreign exchange reserves in the world include Singapore ($152 billion), Hong Kong ($141 billion) and Germany ($126 billion).

Total foreign currency reserves of the members of the Eurosystem, including countries which have adopted Euro as their currency, have been estimated at $453 billion. India's foreign exchange reserves have continued to grow at a rapid pace despite the efforts of the government and the Reserve Bank of India (RBI) to moderate inflows and encourage outflows through various policy initiatives.

Learn Forex Trading - Getting Started In The Marketplace

Learn Forex Trading - Getting Started In The Marketplace

For someone with zero experience and knowledge in the Forex market, getting started in the trading can be an overwhelming task. Various pitfalls, such as huge losses, can discourage even the most experienced trader. Since Forex trading can be a confusing business, you need to follow several guidelines to success.

First, learn Forex trading by choosing the most qualified brokerage firm. Although some firms are better than others are, you have a ton of options in terms of age, reputation and courses to offer. Generally, you should choose a well-established company with a good reputation that is tied to banks or various financial institutions. To ensure that a brokerage firm is legitimate, check if the company is registered with the Commodity Futures Trading Commission.

To learn Forex trading effectively, the brokerage firm should provide you with multiple research tools, such as charts, real-time quotes, trading techniques and research reports. You should choose a firm that offers its account holders as much information as possible. Be aware that the more knowledgeable you are with Forex trading, the more successful you can become in the market. Lastly, choose a highly regarded brokerage form with favorable spread. Be aware that a company with a good spread means that the firm takes off the top of each trade, translating into more profit for you.

In order to learn Forex trading, you need hands-on courses that allow you to experience the market firsthand. Of course, investing money without proper knowledge can lead to disastrous losses, so opening up a demo account should be your next move. With this demo account, you learn Forex trading firsthand because you will be given a pretend balance, which you could use to play around and experience the feel for Forex trading before using real money.

Most demo accounts are free-of-charge for an entire month. During this time, you can learn Forex trading and all its features, techniques and tricks without losing any money. Plus, you are able to master the software, which enables you to make fast trades when the time comes to trade. It is important not to rush the 1-month trial period because this is the most important phase of your trading course.

Once you learn Forex trading and experience a whole month's worth of market experience, then you can now use a real account with actual money. However, never invest large amounts of money; start small and try not to break the bank when getting started in the market place. By choosing a good broker, maximizing the benefits of a demo account and taking your investment one-step at a time, you learn Forex trading can be a fulfilling experience when executed the right way.

Warning Read First Before Investing In The Forex Market

Warning Read First Before Investing In The Forex Market

The foreign exchange market, also known as FX or it is also found to be referred to as the FOREX. All three of these have the same meaning, which is the trade of trading between different banks, governments, and companies that are located in different countries. The financial market is one that is always changing leaving transactions necessary to be completed through brokers, and banks. Many scams have emerged in the FOREX business, as foreign companies and people are setting up online to take advantage of people who are not aware that foreign trade must take place through a broker or a company with direct involvement in foreign exchanges.

Stocks, cash, and currency is traded through the foreign exchange markets. The FOREX market always be present and exist anywhere where one currency is traded for another. Think about when you take a vacation to another country. How are you going to be able to trade your money for the value of the money that is in that other country? This is the basis of FOREX trading, and it is not available in all banks, and it is not available in all financial institutions.

Small companies and individuals are who are many times looking to make big money, are often the victims of scams when it comes to being educated about the foreign trade markets. As FOREX is seen as how to make instant cash, people do not question their participation in such an event, but if you are not investing money through a reputable Forex broker, you could easily end up losing more than you bargained for.

Scams to be aware of

A FOREX scam is one that involves trading but will turn out to be a fraud; you have no chance of receiving your money back once you have invested it. If you were to invest money with a business stating they are involved in FOREX trading you want look closely to learn if they are allowed to do business in your country. Many companies are not allowed in the FOREX market, as they have defrauded investors before.

In the last 5 years, with the help of the internet, FOREX trading has become all the rage. Banks are the #1 source for FOREX trading to take place, where a qualified and licensed broker is going to complete transactions and requirements you set forth. Commissions are rewarded on the transaction and this is the customary way they are compensated.

Forex Training - Finding The Best Techniques Of The Trade

Forex Training - Finding The Best Techniques Of The Trade

Foreign exchange (Forex) is a specific form of trading that involves the buying and selling of various currencies worldwide. Forex trading is traded via inter-bank, which makes it an over-the-counter transaction. It can also be traded via the Internet and telephone. It is a 24-hour global market with trading centers in London, Tokyo and New York. Unfortunately, trading Forex is a difficult undertaking; thus, this market should not be entered into lightly. While anyone who has undergone training can attest that it is not difficult to learn the basics, no one should enter into the market without any kind of training.

Whether you choose to attend a course on location or online, your training should offer a variety of market topics and provide you with a course outline. The training should be geared to newcomers and should tackle finance basics, trading background and overview. Once you have found a course that fits you well, you will see that learning Forex is easy and straightforward. How do you know a course works?

First, Forex training should teach you how the market works, make you understand important terminologies and master how to conduct a trade. It should also teach you about different trading platforms, including their functions, advantages, disadvantages and other important details. By the end of your training, you should be able to read currency charts, analyze prices, manage risks, handle or prevent losses and understand what spread means are vital.

Brokers and professional traders are great sources of learning Forex. While some of these experts offer classes only after opening an account, these courses are usually free and filled with insights, tips and knowledge they are willing to share. Some even let you participate in online Forex demos, seminars and interactive online lessons to scale your capability as an individual trader.

Investing in a high-quality training is a good step to becoming a successful trader in the market. While many people are lured to join this enticing market filled with opportunity, only the educated ones survive this speculative world. Since Forex trading has its risks, producing incredible losses, this business needs to be monitored, understood and mastered. Prevent losses and increase your chances of huge profits... attend a comprehensive Forex training before competing with the big boys.

The Basics Of FOREX Trading

The Basics Of FOREX Trading

If you want the potential of making a lot of money in a short time, then FOREX (Foreign Exchange, or FX) may be just what you are looking for. It has long been the means of the ultra rich to use FOREX principles of gaining their wealth, and it has, until recently been out of reach for the average person. Now, though, many people are trying their hand at gaining wealth this way. Here are some basic thoughts about how FOREX works.
FOREX is based on the trading of one currency for another. Every day, due to international trade and business, as well as political events, one currency's value will fluctuate. Money can be gained in FX by being able to know when the currency of one country will fluctuate - and in which direction.

Although the information in FOREX uses the US dollar as its basis in most currencies, it is not always the case. Where a nation's currency is stronger than the dollar, such as in the case of the English pound, and the euro, that currency is listed first. You will see the listings of what is happening on the FOREX market using a listing such as USD/JPY 117.36. In this case, one dollar will buy 117.36 Japanese yen.

On the same chart, you will also usually see an arrow indicating whether the relationship between the two is changing - and in which direction - up or down. Most currencies are listed with 4 digits beyond the decimal (Japanese yen is the only exception). When your FOREX trading and selling results in a difference of .0001, you have gained a pip.

Trading in FOREX is actually done in units of $100,000, although you do not need to have anywhere near that much. Trades in FX can be made with as little as $50, or so. A FOREX broker, which you must have in order to trade in FOREX, will add to your purchase enough to bring the trade up to $100,000. This is called leverage. Even though you may have actually only used $1,000, the broker brings it up to the needed $100,000. In some cases your leverage advantage can be as high as 400:1. The nice thing about FX, though, is that you keep the winnings as if you had actually used $100,000.

FOREX trading actually provides you with several advantages over trading in the stock market. First, because you are actually trading in currency values, your money is always liquid. Secondly, winnings are often quick - taking place within a few hours. A third advantage is that there may not even be any cost - no broker's fee. Some will charge, however, but when they do, it still is considerably lower than in the stock market.

Learning FOREX is different than the stock market because there are different factors. Everyone has the same data to predict those fluctuations and there is no insider information. You will also need to learn how to choose your own system of predicting when to invest - using a fundamental or a technical approach, and then refining your own methodology. Practice software is available and really is a necessity when it comes to investing safely in FOREX - once you think you are ready.