Archive for May, 2010

The Trend Is Your Friend

May 31st, 2010

If the price is really not going anywhere, then the lines that you draw thru the highest highs and the lowest lows will either be horizontal and parallel to each other, or they will be converging (drawing closer together) or diverging (drawing apart). If they are horizontal, you might use them as support and resistance lines in the same way. Wait for a trend to form.

If the lines are converging, they can indicate a breakout. In this example you shouldn’t treat the lines as support and resistance lines but wait for the price to go past any one of them and continue that way. So if the price breaks above the upper line you would buy, expecting it to resume in that way for a while. Like all currency exchange systems, these aren’t warranted. Always test your system in a demo account before going live. These steps will help you to develop a successful foreign exchange trading strategy..

Foreign Exchange Day Trading Course

May 23rd, 2010

Many currency trading systems are too complex for amateurs who are trying to follow a day trading course plan. When you’re day trading you have to stay in contact with the market all the time. If there are too many indicators to test before you can open or close a trade, it is way more likely that mistakes and missed opportunities will occur. You also don’t want to be operating more than one currency pair, at least not in the beginning. Look for a straightforward system that you understand and can operate quickly . Sadly, customers think that more means better and this is applicable to forex trading systems as well as anything more. It suggests that somebody selling an easy but highly worthwhile system will receive a ton of refund requests because their e-book was too short or easy to understand. The result is that many writers will make their system more complex than it must be, simply to keep buyers happy. It’s a mad situation. Do not buy into that process but look for the simplest rewarding system that you can find. We are lucky nowadays to have some ways of testing currency trading systems. Free foreign exchange charts give us all the past price information that we need for complete back testing, and brokers are falling over each other to make us try their demo accounts. But if you’d like to make any money with forex trading, the moment must come when you step into the real market and take a real risk. If your forex day trading course has prepared you well, you should be able to handle it.

Can You Use Stochastics for Day Trading?

May 18th, 2010

There are such a lot of indicators available in technical charting it’s sometimes tough to know which to use. Often we are accustomed to seeing stochastics given in examples of trends on daily chart, referring to the price at the close of everyday. The stochastic indicator is then just as helpful for a stock trader as it would be for a trader following long term trends.

Stochastics measure the difference between the last final price and the price movement over a certain prior number of time periods. You can adjust the quantity of time periods in your technical charting according to your system, but 14 is the number generally used. It seems to be a magical number for oscillating signals, giving a long enough range to be comparatively correct without being so long that it loses relevance for the present time.

Trading Software for Forex and How to Manage It

May 10th, 2010

Trading software is something that all forex traders use every day. Currency trading was never established on the phone in the same way that stock trading was, simply because foreign exchange rates were fixed for a while. Most traders worked for banks and investment corporations. It was actually the rise of the web that opened up forex trading for the average tiny financier. Brokers developed trading software so that their customers could access the market immediately. This cut brokers’ costs and made it advantageous for them to take on clients with smaller account balances. You need good Internet access over a trustworthy broadband connection, in order to receive streaming price info and send in your orders without slippage. Any delay in the transmission of your order can imply you lose the price you wanted, so dialup just won’t cut it.

What is Different About The Currency Market

May 4th, 2010

This is the first of two articles taking a look at foreign exchange vs stocks from the viewpoint of the retail stock trader. Currency exchange has been getting a lot of press lately and has attracted many new traders home-working, as well as many investors looking to expand into FOREX trading. But what exactly is the forex market? How does it work?

Global Market

foreign exchange trading is a global affair. You aren’t restricted to dealing in the currency of your own country. Transparent Market

The value of a stock is affected by the performance of a company whose figures could be manipulated or known to insiders for a while before it is disclosed publicly. Currency prices, on the other hand, are driven by the business performance of a complete country. This means that a trader working at home, out of the loop of private monetary info, is on a more level playing field in the currency market than in stocks.