FOREX trading

Forex Trading | ForexGen
by: forexgenpivot Keywords: forexgen, forex, online, option, trading, online, forex, broker, forex, information, global, forex, forex, factory, forex, stock, trading, forex


In FOREX trading, there are six major reasons traders lose money. If you can avoid these pitfalls then you can join the minority of winners that pile up the big profits consistently.
Here are the trading traps that will cause you to lose money:



1. The Contrarian’s DiseaseYou should have a contrary opinion to the other Forex traders in the market – most traders lose money, so you want to trade in opposition to the herd.
Most traders lose because they lack discipline and money management - but they’re very often right about market direction. It’s the trader’s inability to maximise these opportunities when they’re trading the FOREX - and stay with the trend, that makes them lose money.
Many traders are looking to pick tops and bottoms, and never focus on trend following. Picking tops and bottoms is impossible. You can’t predict the turning points in FOREX trading - so you need to change your focus to trend following, not prediction.
2. The Chartists Trap
In FOREX trading many traders fall into the trap of putting all their efforts into studying charts. Studying charts is important - but you must not be too subjective, or you will end up losing.
Avoid methods that need too much subjective analysis, such as Elliot Wave and cycles - and gravitate towards indicators that define trends - such as moving averages and momentum oscillators.
Be objective and not subjective in your FOREX trading.
3. Ego
FOREX trading attracts some of the cleverest people in the world, these traders are smart - but they also have big egos. An ego is a bad trait in FOREX trading - as it means you always want to see the market, as you want to see it - and not how it really is.
Traders need to ask themselves this question: Do you want to make money or feel smart? The market won’t accommodate both of these desires – if you want to make money, leave your ego behind.
The humble trader who has an objective and disciplined FOREX trading plan, realizes the market can make him (and everyone else) look stupid. However, he’s only interested in making money, and he’ll generally out perform an ego filled trader, who wants to beat the market.
4. Guru Syndrome
When you’re trading in the FOREX market, it’s tempting to follow someone who’s made money - or says they have.
It’s a fact that most traders want success given to them by someone else, and these traders can’t take responsibility for their own actions.
In the game of FOREX trading, the only way to succeed is on your own - if you can’t accept this, then do something else.
5. Chasing your Tail
Many traders get impatient when FOREX trading - they start trading using one method, get frustrated with it when it’s not performing - they then switch to a different method, and so on.
Bad periods are normally followed by good trading results (if you’re using a soundly based system) - so patience and discipline are needed. By frequently chopping and changing systems, you’ll lose money.
If you have a trading plan that you believe in, then stick with it - and stop chasing your tail. Stay focused, and be patient with your system.
6. Using Options Incorrectly
When you’re FOREX trading, using options gives you staying power - and limited risk, which makes options a great trading tool.
Many traders use options incorrectly - they focus on buying options with small time value, and that are way out of the money. This is a guaranteed way to lose money when options trading! What you need to do is focus on buying options, at or in the money - with lots of time value - also use spreads to increase your chances of success.
In conclusion - Don’t try and be too smart - the above pitfalls are made by some of the brightest traders around. In most cases these mistakes come from thinking you have to be clever, or use complicated methods to succeed - however the reverse is true.
Keep your method simple, keep your focus, accept responsibility for your actions, and accept that the market will make you look stupid at times – it does it to everyone!
If you watch out for the six pitfalls outlined above, you’ll be able to make big long-term profits - and that’s the ONLY goal in FOREX trading.
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Aug 31, 2008 at 15:16 o\clock
Introduction To Forex Trading | ForexGen
by: forexgenpivot Keywords: forexgen, trading, forex, broker, online, forex, trading, forex, market, forex, trading, software, forex, trading, system, forex, trade, forex

There are many markets: markets for stocks, futures, options and currencies. These are probably the most accessible markets for everyday traders like you and I. People easily understand the basics of trading shares. I began trading shares first and then I moved on to trading currencies.If you do not know a lot about currency trading, allow me to introduce it to you. It is what I trade and I believe that it is one of the best markets to trade because of its efficiency. The transaction costs to execute a trade are minimal and most brokers provide you with the tools and data you need to make your trading decisions, they usually provide them for free.
The market is open 24 hours a day which allows you to design your trading hours around your daily commitments. It is very volatile, which is great for those people who are looking for day-trading opportunities.

The foreign exchange market is the market in which currencies are bought and sold against one another. People may loosely refer to this market under different labels, including foreign exchange market, forex market, fx market or the currency market.
The foreign exchange market is the largest market in the world, with daily trading volumes in excess of $1.5 trillion US dollars. All transactions involving international trade and investment must go through this market because these transactions involve the exchange of currencies.
It is the most perfect market that exists because it has a large number of buyers and sellers all selling the same products. There is a free flow of information and there are little barriers to participate.
The currency exchange market is an over-the-counter (OTC) market which means that there is not one specific location where buyers and sellers can actually meet to exchange currencies. Instead, transactions are conducted by phone, fax, e-mail or through the websites of brokers who specialize in currency trading.
The major dealing centers at the time of writing are: London , with about 30% of the market, New York , with 20%, Tokyo , with 12%, Zurich , Frankfurt, Hong Kong and Singapore , with about 7% each, followed by Paris and Sydney with 3% each. Because of the fact that these centers are all over the world, foreign exchange traders can execute transactions 24 hours a day. The market only closes on the weekends.
THE MAIN ‘PLAYERS’ IN THE FOREX MARKET
The five broad categories of participants are: consumers, businesses, investors, speculators, commercial banks, investment banks and central banks.
Consumers, including visitors of countries, tourists and immigrants, do need to exchange currencies when they travel so that they can buy local goods and services. These participants do not have the power to set prices. They just buy and sell according to the prevailing exchange rate. They make up a significant proportion of the volume being traded in the market.
Businesses that import and export goods and services need to exchange currencies to receive or make payments for goods they may have bought or services they may have rendered.
Investors and speculators require currencies to buy and sell investment instruments such as shares, bonds, bank deposits or real estate.
Large commercial and investment banks are the ‘price makers’. They are the ones who buy and sell currencies at the bid-and-offer exchange rates that they declare through their foreign exchange dealers.
Commercial banks deal with customers on one hand, and with the Interbank or other banks, on the other hand. They profit by utilizing the bid-and-offer spread. The bid price is the exchange rate that the buyer is willing to buy and the offer price is the exchange rate at which the seller is willing to sell. The difference is called the bid-offer spread. They also make profits from speculating about whether the exchange rate will rise or fall.
Central banks participate in the foreign exchange market in their effective duty as banks for their particular government. They trade currencies not for the intention of making profits but rather to facilitate government monetary policies and to help smoothen out the fluctuation of the value of their economy’s currency.
WHAT CURRENCIES TO TRADE IN THE FOREX MARKET
You can trade any country’s currency by exchanging it to another country’s currency, however the list below are the ones that are the most popular and are usually made available by most online brokers for you to trade.

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Aug 31, 2008 at 15:11 o\clock
FOREX Trading Strategy | ForexGen
by: forexgenpivot Keywords: forexgen, client, easily, manage, mostly, orders, quotes, trader, within, forex, types, using, mode, news, user, whom, cfd, forex, forex


I ventured into the FOREX market a little more than 1 year ago. I have tried and tested many different types of trading techniques and styles. Most were failures and some were successful. From my experience, traders making money in FOREX will not reveal their trading system, simply because somebody has to lose money in order for you to make money.Currently I have two strategies working for me. I started with a demo account a little more than one year ago and used the obvious techniques such as technical analysis and fundamentals. Technical analysis seemed to be the easiest method for an inexperienced trader since it only required looking at charts as opposed to watching the news. I used indicators such as MACD, Fibonacci, and RSI to help assess the market and make a prediction on price movement. Needless to say I was successful in my demo account, however when I went live, fear set in and I could not trade using the same techniques I had developed over 4 months of trading with a demo account.

The stress was too much and like a lot of people, I started looking for a FOREX signals provider to minimize the time spent and stress. After some due diligence on quite a few FOREX signals providers, I did find a reliable FOREX charting software package that provided excellent signals. To my surprise, the signals worked. The only difficult part was to discipline myself to take each signal whether I agreed with it or not. After all, the company I chose had a winning track record for 3 consecutive years.
Now that I had a positive flow of income from a FOREX signals provider, I decided to open a second account using my own trading system. This is where I discovered what I feel is a full proof system when it comes to making a fast 30 to 50 pips in FOREX.

Trading now for a little more than 1 year, I noticed that the market moved on speculation. Speculation based on fear and news events, such as the CPI and retail sales. I noticed that between the times of 4:30 am eastern and 8:30 am there was a lot of critical news in majors such as the Euro and the British Pound. The market would move at the exact moment these major news events were released. If a news event was due out at 4:30 am on the British Pound, more than likely the market spiked at that exact moment 30 to sometimes 50 pips up or down. What I started to do was trade on these news events. I would wait until that exact moment the news was due out and execute a trade when the market moved more than 7 pips from its current price 15 seconds before the news is released. A stop-loss should be set at 10 pips above or below the current price.

The trick to this method is executing the trade at the right time and discipline yourself to keep your stop-loss very tight, setting it to no more than 10 pips after you got into the trade. The reason being, this works all of the time, but if you click too soon or too late you could fail to predict the direction of the market. However, when you are right, your winning trades will outweigh your losing traders significantly since you are looking to make a gain of 30-50 pips and if you a wrong a loss of only 10 pips. I have used this method for 5 months and it works.
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