Everyone wants to know the number 1 way to trade Forex profitably. Or they want to know the "best" way to trade Forex. This leads to questions like...
Is it with a "secret" system?
Is it scalping?
Is it day trading?
Is there a magic indicator?
Is it an automated FX robot?
And when you think about it, there really are a lot of ways you can go about trading Forex!
Well, I'm going to tell you something that is both profound... and might make you mad.
The number one way to trade Forex is to find the trading method that fits your personality, goals, risk tolerance, etc.... and then FOCUS on learning the methods, gaining experience and developing your trading skills. Don't get distracted by all the hype, and focus on the style of trading Forex that feels right to you. Then just put in the time to MASTER that trading method or style.
I know, this might not be what you were hoping for. I'm sure you were looking for more of a definitive answer. But the truth is, the "number 1 way", or "best" way to trade is different for each individual trader.
But I will give you an hint...
Understanding that the best way to trade Forex really depends on YOU, there is one form of trading that most successful traders migrate towards. This is Price Action Forex Trading. So, if you want to jump to the head of the class as fast as possible... this might be where you should be looking for the right way to trade Forex for you.
You see, many traders go on a journey that includes using robots, black box systems and plenty of indicators. But when the robots fail to perform, or the system doesn't work in certain market conditions or they fail to find the "magic" combination of indicators... they turn to price action trading.
I've heard many stories of this being the turning point in their trading careers. When they stopped looking for something else to trade for them (robots, systems, indicators), and learned how to read price action and make their own trading decisions... they finally found success.
So, if you are still looking for the number 1 way to trade Forex, you might want to give price action Forex trading a try. If you are sick of looking for the Holy Grail combination of indicators, it might be time to get rid of them all together. Price action Forex trading is a skill that can help you turn the corner and go from struggling trader, to profitable trader.
Check out Price Action Forex Trader for the best price action trading resources. Make sure to take the free Price Action Trader Evaluation to find the right price action Forex trading resource for YOUR trading personality, style and expectations.
Saturday, July 17, 2010
What Are the Best Times to Trade Forex?
The best times to trade Forex:
There are a lot of nuances a trader needs to know to be successful in the Forex market. The best times to trade is one of the important ones. Not only do you need a good method. You should also know the best times to implement it.
This will depend on the currency pairs you trade as well. For example when trading the USD/ GBP pair. The best time to trade it would be during the time that the financial center is open in the US and/or the financial center in the UK is open. Preferably both. This is extremely important to anyone who wishes to become a day trader. The times that these two financial centers are open is between the hours of 8am Est time (New York time) and 12pm Est. and is when there is the most volatility and liquidity in the market. This is not surprising considering the US and UK account for more than 50% of all trades that take place on a given day. Coupled with the fact that most of the economic news is released for these economies as well during these times.
The Girl with the Dragon Tattoo
So lets review all sessions and which are the least active. Starting with the slowest, the Asian session. The Australian market combined all of Asian markets still pale in comparison to the size of just one of the two mentioned above. Big moves do occur during this session but they are not often and usually due to a big news release.
Next to open is the European session which starts with Frankfurt at 2am Est. time and then London at 3am Est. time. Note that the Asian session is in the 2nd half of their day at this time also. There is usually good volatility and liquidity at this time also since Asia is winding down their day while Europe is starting theirs. This session ends at 12pm Est. time as mentioned above.
Last is the US session that opens at 8am Est. and closes at 4:30 pm when US equities close. Volatility and liquidity usually drop off after the European session closes and the market gets slow for the last part of the trading day in the US. Obviously the time the market is thinnest will be the few hours between US close and Asian open.
One way of using this knowledge to your advantage is to study price action during these times which will give you an edge. There are certain times that price will show you where the market is headed and this will add confidence to your trade and your profits. Good luck.
Nial Fuller has been a successful Forex trader for many years. He started studying price action when he was 15. Now at 25 he has traded at a major firm for over 6 years. His website offers a lot of free material. To get free video tutorials on price action visit this link: learn to trade
There are a lot of nuances a trader needs to know to be successful in the Forex market. The best times to trade is one of the important ones. Not only do you need a good method. You should also know the best times to implement it.
This will depend on the currency pairs you trade as well. For example when trading the USD/ GBP pair. The best time to trade it would be during the time that the financial center is open in the US and/or the financial center in the UK is open. Preferably both. This is extremely important to anyone who wishes to become a day trader. The times that these two financial centers are open is between the hours of 8am Est time (New York time) and 12pm Est. and is when there is the most volatility and liquidity in the market. This is not surprising considering the US and UK account for more than 50% of all trades that take place on a given day. Coupled with the fact that most of the economic news is released for these economies as well during these times.
The Girl with the Dragon Tattoo
So lets review all sessions and which are the least active. Starting with the slowest, the Asian session. The Australian market combined all of Asian markets still pale in comparison to the size of just one of the two mentioned above. Big moves do occur during this session but they are not often and usually due to a big news release.
Next to open is the European session which starts with Frankfurt at 2am Est. time and then London at 3am Est. time. Note that the Asian session is in the 2nd half of their day at this time also. There is usually good volatility and liquidity at this time also since Asia is winding down their day while Europe is starting theirs. This session ends at 12pm Est. time as mentioned above.
Last is the US session that opens at 8am Est. and closes at 4:30 pm when US equities close. Volatility and liquidity usually drop off after the European session closes and the market gets slow for the last part of the trading day in the US. Obviously the time the market is thinnest will be the few hours between US close and Asian open.
One way of using this knowledge to your advantage is to study price action during these times which will give you an edge. There are certain times that price will show you where the market is headed and this will add confidence to your trade and your profits. Good luck.
Nial Fuller has been a successful Forex trader for many years. He started studying price action when he was 15. Now at 25 he has traded at a major firm for over 6 years. His website offers a lot of free material. To get free video tutorials on price action visit this link: learn to trade
Online Forex Trading - Learn the Best Way to Trade Forex
When It comes to the world of online Forex trading, there is simply just too much information on what you have to do. You just have to follow your instincts when it comes to taking advice and practice before you put your life-savings on the line.
In fact, when it comes to Forex - you never want to put money you really need on the table because you'll simply lose it in a short amount of time if you make the wrong decision - high risk, high reward is what Forex truly is.
Now let's talk about these so-called experts that are all across the internet and claim that they have to key to Forex Success Heaven. Most of the experts are just ordinary people like you or me who have seen success using their specific method which may or may not work for you.
One of these things is known as Day-Trading. It's a common thing to see people claiming that day trading can earn tons of cash [which it can], but it's no necessarily the best way to go.
You may experience inconsistent profits, or even worse - consistent losses; especially if you have no idea what you are doing.
If you are not seeing the types of margin you want to - you also have to remember that the broker has to take a cut as well, which is the difference between the bid and ask prices.
So no matter if you profit or not, you will always have to pay the Broker - after all, they have to make their money too! You have to become experienced and learn the ins and outs, how to spot trends and know what works for you; so how do you do that?
Advice Accumulation & Paper Trading
Before you even put down tons of money - unless you just have money to throw away which the majority do not; you will have to start accumulating advice from the internet that you think that can help.
I do not recommend spending a sum of money on tons of Ebooks, unless it's really convincing (convincing in a matter that you'll get the information you'll need as opposed to a get rich quick scheme) simply because you be spending more than your making with the "Forex Ebook Spending Trap"
Now when you get this advice, you will want to paper trade - simulate on paper how your trades will go with the advice you are accumulating.
When you start seeing profits on a consistent basis with paper trading, then consider putting a small amount of cash and increase it slowly!
Knowledge is ultimately power; and you have to know that on Forex you will be taking risks. It's just a matter of reducing those risks to the point where you'll see more profit than loss is the way to go.
Remember, you can do it, Forex is a market in which Trillions of dollars are traded on a regular basis! Start today!
Achieve Auto-Pilot Forex Profits 24/7. Earning small yet consistent profits through Forex while you are at your computer or away is a possibility with the Forex Auto-Pilot System. Complete beginners will have the ability to earn without any knowledge of how Forex works! For more information, visit: http://autopilotforexprofits.blogspot.com
In fact, when it comes to Forex - you never want to put money you really need on the table because you'll simply lose it in a short amount of time if you make the wrong decision - high risk, high reward is what Forex truly is.
Now let's talk about these so-called experts that are all across the internet and claim that they have to key to Forex Success Heaven. Most of the experts are just ordinary people like you or me who have seen success using their specific method which may or may not work for you.
One of these things is known as Day-Trading. It's a common thing to see people claiming that day trading can earn tons of cash [which it can], but it's no necessarily the best way to go.
You may experience inconsistent profits, or even worse - consistent losses; especially if you have no idea what you are doing.
If you are not seeing the types of margin you want to - you also have to remember that the broker has to take a cut as well, which is the difference between the bid and ask prices.
So no matter if you profit or not, you will always have to pay the Broker - after all, they have to make their money too! You have to become experienced and learn the ins and outs, how to spot trends and know what works for you; so how do you do that?
Advice Accumulation & Paper Trading
Before you even put down tons of money - unless you just have money to throw away which the majority do not; you will have to start accumulating advice from the internet that you think that can help.
I do not recommend spending a sum of money on tons of Ebooks, unless it's really convincing (convincing in a matter that you'll get the information you'll need as opposed to a get rich quick scheme) simply because you be spending more than your making with the "Forex Ebook Spending Trap"
Now when you get this advice, you will want to paper trade - simulate on paper how your trades will go with the advice you are accumulating.
When you start seeing profits on a consistent basis with paper trading, then consider putting a small amount of cash and increase it slowly!
Knowledge is ultimately power; and you have to know that on Forex you will be taking risks. It's just a matter of reducing those risks to the point where you'll see more profit than loss is the way to go.
Remember, you can do it, Forex is a market in which Trillions of dollars are traded on a regular basis! Start today!
Achieve Auto-Pilot Forex Profits 24/7. Earning small yet consistent profits through Forex while you are at your computer or away is a possibility with the Forex Auto-Pilot System. Complete beginners will have the ability to earn without any knowledge of how Forex works! For more information, visit: http://autopilotforexprofits.blogspot.com
FAP Turbo - An Automated Trading Tool For Forex Traders
When it comes to using new technology especially in business, man is naturally doubtful and skeptical to try something they lack knowledge about. This also happens with traders who are being offered to use a new technology like a fully automated Forex software robot. One of these Forex software systems is the FAP Turbo. It has always been doubted to perform better than other Forex robots.
Like any other products, FAP Turbo has undergone several testing and enhancements before it were launched in the market. And these tests took several months before it succeeded. This software was also checked for its quality and ability to give satisfactory results to its possible users. And so as for the manufacturing of the software, FAP Turbo is assured to be offered to the public in its full potential and efficiency.
FAP Turbo offers a 95 percent success rate to its users. This is why it has quickly gained popularity among traders. Of course, traders are looking for tools that can give them profit and thought that FAP Turbo might become a big help for them.
This software has the ability to provide accurate computations and predictions which other Forex robots cannot provide. It also has a low percentage of errors which is not acceptable in the Forex market. A single mistake can turn your money into a loss. And its main promise is to give higher winnings and better profits from the Forex market. This is now the professional way of earning from the Forex trading scene with a more touch of technology.
These machines only help humans get faster results and improve work quality. But it is still the human mind that has created such effective tools and without humans, these tools are non-existent. With these robots, men can fully use the power of technology to gain and earn more in their businesses.
Top Forex Robot: As Seen on CNN, CNBC and FORBES Money. If you'd like to try an Automated Forex Robot that has been proven on video to double the deposit of my trading account in under 1 week, visit my site and see the Top 3 Forex Robots and learn how you can TRIPLE your Forex Account within a Weeks! Get the Latest Version of All Forex Trading Robots Via my Forex Robot Review sites. Updated Daily! Also See: Forex Megadroid Vs FAP Turbo Vs IVY Bot
Like any other products, FAP Turbo has undergone several testing and enhancements before it were launched in the market. And these tests took several months before it succeeded. This software was also checked for its quality and ability to give satisfactory results to its possible users. And so as for the manufacturing of the software, FAP Turbo is assured to be offered to the public in its full potential and efficiency.
FAP Turbo offers a 95 percent success rate to its users. This is why it has quickly gained popularity among traders. Of course, traders are looking for tools that can give them profit and thought that FAP Turbo might become a big help for them.
This software has the ability to provide accurate computations and predictions which other Forex robots cannot provide. It also has a low percentage of errors which is not acceptable in the Forex market. A single mistake can turn your money into a loss. And its main promise is to give higher winnings and better profits from the Forex market. This is now the professional way of earning from the Forex trading scene with a more touch of technology.
These machines only help humans get faster results and improve work quality. But it is still the human mind that has created such effective tools and without humans, these tools are non-existent. With these robots, men can fully use the power of technology to gain and earn more in their businesses.
Top Forex Robot: As Seen on CNN, CNBC and FORBES Money. If you'd like to try an Automated Forex Robot that has been proven on video to double the deposit of my trading account in under 1 week, visit my site and see the Top 3 Forex Robots and learn how you can TRIPLE your Forex Account within a Weeks! Get the Latest Version of All Forex Trading Robots Via my Forex Robot Review sites. Updated Daily! Also See: Forex Megadroid Vs FAP Turbo Vs IVY Bot
Forex Trading Tools For Better Trading
Today we all know that one of the best ways to make big money is by trading in the Forex trading market, where the top powerful financial countries currencies are being bought and sold on a daily basis. Trading in the Forex market is not an easy job, it requires one to be intelligent, attentive and possess a mind that takes quick decisions in buying, selling and stopping in the thriving market. It also needs people to be able to predict how the market will progress in various conditions. For this basic reason experts in the field of finance and Forex trading have created certain automated tools to help investors to deal in the Forex trading platform with ease.
It is a normal practice where each Forex dealer tends to use a Forex trading tool to assist them in making the right decisions with trade in the market. One can find many such tools that are easily available for individuals to purchase. These tools are user friendly and can be easily installed on any computer, where the Forex trading platform can be accessed by using an internet connection. This is most beneficial for Forex traders who love working from home where they would be updated with the current standings of the currencies in the trading market.
These Forex trading tools would benefit an individual in the following ways:
o Creates and trades Forex signals by itself
o The individual does not have to work
o Low risks involved with great returns
o Not much of experience required by the individual to trade online
o Trading can be carried out with any currency
o Test and proven to be a profit making program
These trading tools that has been designed, tested and proven a success by specialist, who possess a vast knowledge of the complex mathematics and algorithm that is needed for profit making. Additionally to make one's trading more efficient they should consider installing charting software that can evaluate and direct the trend and movements of the currencies in the Forex market. This will lead to the individual performing professionally using the technical data and trade options to decide when to buy and sell in the market.
To actually begin trading in the Forex market one has to have an online Forex trading account in order to carry out the process of trading online. This Forex account can be easily acquired through a reliable brokerage firm that would assist them in achieving their goals to make the big bucks. The normal trend that most Forex sites follow is that when opening an account the individual has to place down a deposit which can be transacted by means of e-wallet.
It would also help the individual that is intending to deal in the Forex market to get some Forex advice from firms offering advisory services or Forex trading sites which would provide feedbacks or reviews to understand and predict the general movements in the currencies.
It is a normal practice where each Forex dealer tends to use a Forex trading tool to assist them in making the right decisions with trade in the market. One can find many such tools that are easily available for individuals to purchase. These tools are user friendly and can be easily installed on any computer, where the Forex trading platform can be accessed by using an internet connection. This is most beneficial for Forex traders who love working from home where they would be updated with the current standings of the currencies in the trading market.
These Forex trading tools would benefit an individual in the following ways:
o Creates and trades Forex signals by itself
o The individual does not have to work
o Low risks involved with great returns
o Not much of experience required by the individual to trade online
o Trading can be carried out with any currency
o Test and proven to be a profit making program
These trading tools that has been designed, tested and proven a success by specialist, who possess a vast knowledge of the complex mathematics and algorithm that is needed for profit making. Additionally to make one's trading more efficient they should consider installing charting software that can evaluate and direct the trend and movements of the currencies in the Forex market. This will lead to the individual performing professionally using the technical data and trade options to decide when to buy and sell in the market.
To actually begin trading in the Forex market one has to have an online Forex trading account in order to carry out the process of trading online. This Forex account can be easily acquired through a reliable brokerage firm that would assist them in achieving their goals to make the big bucks. The normal trend that most Forex sites follow is that when opening an account the individual has to place down a deposit which can be transacted by means of e-wallet.
It would also help the individual that is intending to deal in the Forex market to get some Forex advice from firms offering advisory services or Forex trading sites which would provide feedbacks or reviews to understand and predict the general movements in the currencies.
Forex Trading Strategies and the Trader's Fallacy
The Trader's Fallacy is one of the most familiar yet treacherous ways a Forex traders can go wrong. This is a huge pitfall when using any manual Forex trading system. Commonly called the "gambler's fallacy" or "Monte Carlo fallacy" from gaming theory and also called the "maturity of chances fallacy".
The Trader's Fallacy is a powerful temptation that takes many different forms for the Forex trader. Any experienced gambler or Forex trader will recognize this feeling. It is that absolute conviction that because the roulette table has just had 5 red wins in a row that the next spin is more likely to come up black. The way trader's fallacy really sucks in a trader or gambler is when the trader starts believing that because the "table is ripe" for a black, the trader then also raises his bet to take advantage of the "increased odds" of success. This is a leap into the black hole of "negative expectancy" and a step down the road to "Trader's Ruin".
"Expectancy" is a technical statistics term for a relatively simple concept. For Forex traders it is basically whether or not any given trade or series of trades is likely to make a profit. Positive expectancy defined in its most simple form for Forex traders, is that on the average, over time and many trades, for any give Forex trading system there is a probability that you will make more money than you will lose.
"Traders Ruin" is the statistical certainty in gambling or the Forex market that the player with the larger bankroll is more likely to end up with ALL the money! Since the Forex market has a functionally infinite bankroll the mathematical certainty is that over time the Trader will inevitably lose all his money to the market, EVEN IF THE ODDS ARE IN THE TRADERS FAVOR! Luckily there are steps the Forex trader can take to prevent this! You can read my other articles on Positive Expectancy and Trader's Ruin to get more information on these concepts.
Back To The Trader's Fallacy
If some random or chaotic process, like a roll of dice, the flip of a coin, or the Forex market appears to depart from normal random behavior over a series of normal cycles -- for example if a coin flip comes up 7 heads in a row - the gambler's fallacy is that irresistible feeling that the next flip has a higher chance of coming up tails. In a truly random process, like a coin flip, the odds are always the same. In the case of the coin flip, even after 7 heads in a row, the chances that the next flip will come up heads again are still 50%. The gambler might win the next toss or he might lose, but the odds are still only 50-50.
What often happens is the gambler will compound his error by raising his bet in the expectation that there is a better chance that the next flip will be tails. HE IS WRONG. If a gambler bets consistently like this over time, the statistical probability that he will lose all his money is near certain.The only thing that can save this turkey is an even less probable run of incredible luck.
The Forex market is not really random, but it is chaotic and there are so many variables in the market that true prediction is beyond current technology. What traders can do is stick to the probabilities of known situations. This is where technical analysis of charts and patterns in the market come into play along with studies of other factors that affect the market. Many traders spend thousands of hours and thousands of dollars studying market patterns and charts trying to predict market movements.
Most traders know of the various patterns that are used to help predict Forex market moves. These chart patterns or formations come with often colorful descriptive names like "head and shoulders," "flag," "gap," and other patterns associated with candlestick charts like "engulfing," or "hanging man" formations. Keeping track of these patterns over long periods of time may result in being able to predict a "probable" direction and sometimes even a value that the market will move. A Forex trading system can be devised to take advantage of this situation.
The trick is to use these patterns with strict mathematical discipline, something few traders can do on their own.
A greatly simplified example; after watching the market and it's chart patterns for a long period of time, a trader might figure out that a "bull flag" pattern will end with an upward move in the market 7 out of 10 times (these are "made up numbers" just for this example). So the trader knows that over many trades, he can expect a trade to be profitable 70% of the time if he goes long on a bull flag. This is his Forex trading signal. If he then calculates his expectancy, he can establish an account size, a trade size, and stop loss value that will ensure positive expectancy for this trade.If the trader starts trading this system and follows the rules, over time he will make a profit.
Winning 70% of the time does not mean the trader will win 7 out of every 10 trades. It may happen that the trader gets 10 or more consecutive losses. This where the Forex trader can really get into trouble -- when the system seems to stop working. It doesn't take too many losses to induce frustration or even a little desperation in the average small trader; after all, we are only human and taking losses hurts! Especially if we follow our rules and get stopped out of trades that later would have been profitable.
If the Forex trading signal shows again after a series of losses, a trader can react one of several ways. Bad ways to react: The trader can think that the win is "due" because of the repeated failure and make a larger trade than normal hoping to recover losses from the losing trades on the feeling that his luck is "due for a change." The trader can place the trade and then hold onto the trade even if it moves against him, taking on larger losses hoping that the situation will turn around. These are just two ways of falling for the Trader's Fallacy and they will most likely result in the trader losing money.
There are two correct ways to respond, and both require that "iron willed discipline" that is so rare in traders. One correct response is to "trust the numbers" and merely place the trade on the signal as normal and if it turns against the trader, once again immediately quit the trade and take another small loss, or the trader can merely decided not to trade this pattern and watch the pattern long enough to ensure that with statistical certainty that the pattern has changed probability. These last two Forex trading strategies are the only moves that will over time fill the traders account with winnings.
Forex Trading Robots - A Way To Beat Trader's Fallacy
The Forex market is chaotic and influenced by many factors that also affect the trader's feelings and decisions. One of the easiest ways to avoid the temptation and aggravation of trying to integrate the thousands of variable factors in Forex trading is to adopt a mechanical Forex trading system. Forex trading software systems based on Forex trading signals and currency trading systems with carefully researched automated FX trading rules can take much of the frustration and guesswork out of Forex trading. These automatic Forex trading programs introduce the "discipline" necessary to actually achieve positive expectancy and avoid the pitfalls of Trader's Ruin and the temptations of Trader's Fallacy.
Automated Forex trading systems and mechanical trading software enforce trading discipline. This keeps losses small, and lets winning positions run with built in positive expectancy. It is Forex made easy. There are many excellent Online Forex Reviews of automated Forex trading systems that can do simulated Forex trading online, using Forex demo accounts, where the average trader can test them for up to 60 days without risk. The best of these programs also have 100% money back guarantees. Many will help the trader pick the best Forex broker compatible with their online Forex trading platform. Most offer full support setting up Forex demo accounts. Both beginning and experienced traders, can learn a tremendous amount just from the running the automated Forex trading software on the demo accounts. This experience will help you decide which is the best Forex system trading software for your goals. Let the experts develop winning systems while you just test their work for profitable results. Then relax and watch the Forex autotrading robots make money while you rake in the profits.
About The Author: Ben Theranbak is an avid student of history, economics, statistics and the markets. He has an MBA, an MS in Aeronautical Engineering and is a graduate of the Naval War College. A former Naval Aviator, Ben is a skydiver and world traveler.
Get a FREE report on a SPECIAL new development in FOREX trading at his website at http://trueairspeed.ws/. This site also offers reviews of several of the best available FOREX automatic trading systems that offer fully automated trading capability along with the ability to fully test the systems using Demo accounts or paper trading for a full 60 days along with full, unconditional 100% money back guarantees.
The Trader's Fallacy is a powerful temptation that takes many different forms for the Forex trader. Any experienced gambler or Forex trader will recognize this feeling. It is that absolute conviction that because the roulette table has just had 5 red wins in a row that the next spin is more likely to come up black. The way trader's fallacy really sucks in a trader or gambler is when the trader starts believing that because the "table is ripe" for a black, the trader then also raises his bet to take advantage of the "increased odds" of success. This is a leap into the black hole of "negative expectancy" and a step down the road to "Trader's Ruin".
"Expectancy" is a technical statistics term for a relatively simple concept. For Forex traders it is basically whether or not any given trade or series of trades is likely to make a profit. Positive expectancy defined in its most simple form for Forex traders, is that on the average, over time and many trades, for any give Forex trading system there is a probability that you will make more money than you will lose.
"Traders Ruin" is the statistical certainty in gambling or the Forex market that the player with the larger bankroll is more likely to end up with ALL the money! Since the Forex market has a functionally infinite bankroll the mathematical certainty is that over time the Trader will inevitably lose all his money to the market, EVEN IF THE ODDS ARE IN THE TRADERS FAVOR! Luckily there are steps the Forex trader can take to prevent this! You can read my other articles on Positive Expectancy and Trader's Ruin to get more information on these concepts.
Back To The Trader's Fallacy
If some random or chaotic process, like a roll of dice, the flip of a coin, or the Forex market appears to depart from normal random behavior over a series of normal cycles -- for example if a coin flip comes up 7 heads in a row - the gambler's fallacy is that irresistible feeling that the next flip has a higher chance of coming up tails. In a truly random process, like a coin flip, the odds are always the same. In the case of the coin flip, even after 7 heads in a row, the chances that the next flip will come up heads again are still 50%. The gambler might win the next toss or he might lose, but the odds are still only 50-50.
What often happens is the gambler will compound his error by raising his bet in the expectation that there is a better chance that the next flip will be tails. HE IS WRONG. If a gambler bets consistently like this over time, the statistical probability that he will lose all his money is near certain.The only thing that can save this turkey is an even less probable run of incredible luck.
The Forex market is not really random, but it is chaotic and there are so many variables in the market that true prediction is beyond current technology. What traders can do is stick to the probabilities of known situations. This is where technical analysis of charts and patterns in the market come into play along with studies of other factors that affect the market. Many traders spend thousands of hours and thousands of dollars studying market patterns and charts trying to predict market movements.
Most traders know of the various patterns that are used to help predict Forex market moves. These chart patterns or formations come with often colorful descriptive names like "head and shoulders," "flag," "gap," and other patterns associated with candlestick charts like "engulfing," or "hanging man" formations. Keeping track of these patterns over long periods of time may result in being able to predict a "probable" direction and sometimes even a value that the market will move. A Forex trading system can be devised to take advantage of this situation.
The trick is to use these patterns with strict mathematical discipline, something few traders can do on their own.
A greatly simplified example; after watching the market and it's chart patterns for a long period of time, a trader might figure out that a "bull flag" pattern will end with an upward move in the market 7 out of 10 times (these are "made up numbers" just for this example). So the trader knows that over many trades, he can expect a trade to be profitable 70% of the time if he goes long on a bull flag. This is his Forex trading signal. If he then calculates his expectancy, he can establish an account size, a trade size, and stop loss value that will ensure positive expectancy for this trade.If the trader starts trading this system and follows the rules, over time he will make a profit.
Winning 70% of the time does not mean the trader will win 7 out of every 10 trades. It may happen that the trader gets 10 or more consecutive losses. This where the Forex trader can really get into trouble -- when the system seems to stop working. It doesn't take too many losses to induce frustration or even a little desperation in the average small trader; after all, we are only human and taking losses hurts! Especially if we follow our rules and get stopped out of trades that later would have been profitable.
If the Forex trading signal shows again after a series of losses, a trader can react one of several ways. Bad ways to react: The trader can think that the win is "due" because of the repeated failure and make a larger trade than normal hoping to recover losses from the losing trades on the feeling that his luck is "due for a change." The trader can place the trade and then hold onto the trade even if it moves against him, taking on larger losses hoping that the situation will turn around. These are just two ways of falling for the Trader's Fallacy and they will most likely result in the trader losing money.
There are two correct ways to respond, and both require that "iron willed discipline" that is so rare in traders. One correct response is to "trust the numbers" and merely place the trade on the signal as normal and if it turns against the trader, once again immediately quit the trade and take another small loss, or the trader can merely decided not to trade this pattern and watch the pattern long enough to ensure that with statistical certainty that the pattern has changed probability. These last two Forex trading strategies are the only moves that will over time fill the traders account with winnings.
Forex Trading Robots - A Way To Beat Trader's Fallacy
The Forex market is chaotic and influenced by many factors that also affect the trader's feelings and decisions. One of the easiest ways to avoid the temptation and aggravation of trying to integrate the thousands of variable factors in Forex trading is to adopt a mechanical Forex trading system. Forex trading software systems based on Forex trading signals and currency trading systems with carefully researched automated FX trading rules can take much of the frustration and guesswork out of Forex trading. These automatic Forex trading programs introduce the "discipline" necessary to actually achieve positive expectancy and avoid the pitfalls of Trader's Ruin and the temptations of Trader's Fallacy.
Automated Forex trading systems and mechanical trading software enforce trading discipline. This keeps losses small, and lets winning positions run with built in positive expectancy. It is Forex made easy. There are many excellent Online Forex Reviews of automated Forex trading systems that can do simulated Forex trading online, using Forex demo accounts, where the average trader can test them for up to 60 days without risk. The best of these programs also have 100% money back guarantees. Many will help the trader pick the best Forex broker compatible with their online Forex trading platform. Most offer full support setting up Forex demo accounts. Both beginning and experienced traders, can learn a tremendous amount just from the running the automated Forex trading software on the demo accounts. This experience will help you decide which is the best Forex system trading software for your goals. Let the experts develop winning systems while you just test their work for profitable results. Then relax and watch the Forex autotrading robots make money while you rake in the profits.
About The Author: Ben Theranbak is an avid student of history, economics, statistics and the markets. He has an MBA, an MS in Aeronautical Engineering and is a graduate of the Naval War College. A former Naval Aviator, Ben is a skydiver and world traveler.
Get a FREE report on a SPECIAL new development in FOREX trading at his website at http://trueairspeed.ws/. This site also offers reviews of several of the best available FOREX automatic trading systems that offer fully automated trading capability along with the ability to fully test the systems using Demo accounts or paper trading for a full 60 days along with full, unconditional 100% money back guarantees.
Online Forex Trading Secrets
ForeX Trading for Maximum Profit: The Best Kept Secret Off Wall Street
I am here to share some knowledge, tips, strategies and insights of how to successfully buy, sell, trade and invest in online Forex trading. FOREX or Foreign Exchange is the largest as well as the most liquid trading market in the world and there are many people involved in FOREX trading all over the world. A lot of people claim that the FOREX is the best home business that could be pursued by any person. With each day, more and more are turning to FOREX traders, via electronic means of computer and internet connectivity.
This means that foreign exchange is not delivered to a person who actually buys like stock trading, FOREX trading also has day traders that purchase and sell foreign exchange same day. Thus, FOREX is not a get-rich-quick scheme as many people thought which complicates the real concept of online Forex trading.
Unlike stocks and futures that trade through exchanges, Forex trading is done through market makers that include major banks as well as small to large brokerage firms located around the world who collectively make a market on 24 hours - 5 days basis. The Forex market is always "open" and is the largest financial network in the world (daily average turnover of trillions of dollars).
Forex trading involves trading currency pairs such as the EUR/USD pair (Eurodollar/US dollar pair) where a buyer of this pair would actually be buying the Eurodollar and simultaneously selling short the US dollar.
Here's the deal: Just like any other market, most "traders" are losing when trading Forex. And the reasons for their failure are mainly because some lack good trading methods, sound money and risk management principles and indiscipline trading attitude. In most cases, it could be wrong mindset and motive towards the market. Some don't even understand the trend of the market, of which the trend plays a vital role in the life of any trader, as it is simply says that "the trend is your friend".
Moreover, many have been mislead by dishonest individuals or questionable brokers promising outwardly overnight riches and hidden policies.
Forex is still a little like the "wild west", so there's naturally a lot of confusion and misinformation out there but I'm here to cover many tactics and strategies used by successful Forex traders all over the world. Unfortunately, only few Forex traders are actually aware of this information.
Forex trading is all about regulation, willpower and determination. Leveraging your strength could be extravagant by organizing the appropriate Forex trading strategy. You may find hundreds and thousands of Forex trading strategies out there. All Forex trading strategies use a variety of indicators and combinations. These indicators and studies are just calculating support and resistance and trend in the Forex trading market.
What you are about to read is more valuable to you than what you will find in many trading courses or seminars that you'd have to pay for. Anyway, I don't believe in sugarcoating anything or giving you false hopes of success. There are enough swindlers doing that already. I want to give you the facts, like 'em or not, so you're empowered to take action and make positive decisions on how to succeed in the Forex markets.
There's nothing magical about the Forex markets, because all markets are ultimately driven by human psychology - fear and greed - and supply and demand. Sure, every market has its own peculiarities, but if you understand how the basic drivers of human emotions work, you can potentially succeed big in Forex market, because the market controls 95% of live trader's emotions. Some traders think it's a "get rich quick" trading the popular Forex markets.
There are many advantages of Forex trading over other types of financial instrument trading like bonds, stocks, commodities etc. But it does not mean that there are no risks involved in the Forex trading. Of course there are risks associated with Forex trading. Therefore, someone needs to understand all the terms related to Foreign Exchange carefully. There are many online sources as well as offline sources that provide hints on trading of Forex. These hints are basically the SECRETS.
As I said above, the foreign exchange trading is considered as one of the most profitable and attractive opportunities for investment as any person can easily do at home or office and from any part of the world. For succeeding the Forex trading, a person is not required to do any online promotion, marketing etc. The only requirement in the Forex trading is the account that a person is required to open with reliable and registered brokers, a computer system and fast internet connection.
Now, you have to be careful when opening a Forex account with any broker because some could be SCAM. The Commodity Futures Trading Commission (CFTC) in US has jurisdiction over all Futures and Forex activity. When trading in the foreign exchange markets, individuals should only trade with a CFTC registered entity that is also a member of the National Futures Association (NFA) and is regulated by the CFTC. For non-US broker/ bank entities, be sure that the broker or bank is registered with that country's appropriate regulatory bodies.
The Forex account could be opened with any amount between $300 (mini) and $2000 (standard). After opening the account, a person is required to learn how the Forex market works, demo trade and after a while go live trading. Moreover, there are some secrets that have to be followed.
A person can also apply all the secrets when demo trading and can see if the secrets really work. It could be said without any doubt that if someone can apply all the secrets in right way, he/she can easily gain good money by way of Forex trading.
All successful traders have Forex trading strategies that they follow to make profitable trades. These Forex trading strategies are generally based on a strategy that allows them to find good trades. And the strategy is based on some form of market analysis. Successful traders need some ways to interpret and even predict the movements of the market.
There are two basic approaches to analyzing the movements of the Forex market. These are Technical Analysis and Fundamental Analysis. However, technical analysis is much more likely to be used by traders. Still, it's good to have an understanding of both types of analysis, so that you can decide which type would work best for your Forex trading strategies.
There has been misconception about the Forex market because there are different types of traders and advert out there full of exaggerations that makes the business unreal to so many people and that is why I am here to show you the SECRETS in Forex Trading.
What is traded on the Forex market? The answer is money. Forex trading is where the currency of one nation is traded for that of another. Therefore, Forex trading is always traded in pairs and the most commonly traded currency pairs are traded against the US Dollar (USD). They are called 'the Majors'. The major currency pairs are the Euro Dollar (EUR/USD); the British Pound (GBP/USD); the Japanese Yen (USD/JPY); and the Swiss Franc (USD/CHF). The notable 'commodity' currency pairs that traded are the Canadian Dollar (USD/CAD) and the Australian Dollar AUD/USD. Because there is no central exchange for the Forex market, these pairs and their crosses are traded over the telephone and online through a global network of banks, multinational corporations, importers and exporters, brokers and currency traders. But if you really want to make it big in the Forex market, I will strongly advise that as a "beginner" in the business. Kindly get acquainted with one or two major currency pairs. Study them very well and make sure you understand their volatility period.
And to further simplify Forex trading, you could easily limit your trading to the two most liquid and widely traded pairs, the EUR/USD and the GBP/USD. This really starts to reduce demands on your time for trading activities without giving up good profit potential.
Traditionally, currency trading has been a 'professionals only' market available exclusively to banks and large institutions, however, because of the invention of the new E-economy, online Forex trading firms are now able to offer trading accounts to 'retail' traders like you and I. Now almost anyone with a computer and an Internet connection can trade currencies just like the world's largest banks do.
Do you want to know how to trade the forex market without losing a dime?Then go over to [http://quickforexpips.blogspot.com] you will get free tons of information there.
I am here to share some knowledge, tips, strategies and insights of how to successfully buy, sell, trade and invest in online Forex trading. FOREX or Foreign Exchange is the largest as well as the most liquid trading market in the world and there are many people involved in FOREX trading all over the world. A lot of people claim that the FOREX is the best home business that could be pursued by any person. With each day, more and more are turning to FOREX traders, via electronic means of computer and internet connectivity.This means that foreign exchange is not delivered to a person who actually buys like stock trading, FOREX trading also has day traders that purchase and sell foreign exchange same day. Thus, FOREX is not a get-rich-quick scheme as many people thought which complicates the real concept of online Forex trading.
Unlike stocks and futures that trade through exchanges, Forex trading is done through market makers that include major banks as well as small to large brokerage firms located around the world who collectively make a market on 24 hours - 5 days basis. The Forex market is always "open" and is the largest financial network in the world (daily average turnover of trillions of dollars).
Forex trading involves trading currency pairs such as the EUR/USD pair (Eurodollar/US dollar pair) where a buyer of this pair would actually be buying the Eurodollar and simultaneously selling short the US dollar.
Here's the deal: Just like any other market, most "traders" are losing when trading Forex. And the reasons for their failure are mainly because some lack good trading methods, sound money and risk management principles and indiscipline trading attitude. In most cases, it could be wrong mindset and motive towards the market. Some don't even understand the trend of the market, of which the trend plays a vital role in the life of any trader, as it is simply says that "the trend is your friend".
Moreover, many have been mislead by dishonest individuals or questionable brokers promising outwardly overnight riches and hidden policies.
Forex is still a little like the "wild west", so there's naturally a lot of confusion and misinformation out there but I'm here to cover many tactics and strategies used by successful Forex traders all over the world. Unfortunately, only few Forex traders are actually aware of this information.
Forex trading is all about regulation, willpower and determination. Leveraging your strength could be extravagant by organizing the appropriate Forex trading strategy. You may find hundreds and thousands of Forex trading strategies out there. All Forex trading strategies use a variety of indicators and combinations. These indicators and studies are just calculating support and resistance and trend in the Forex trading market.
What you are about to read is more valuable to you than what you will find in many trading courses or seminars that you'd have to pay for. Anyway, I don't believe in sugarcoating anything or giving you false hopes of success. There are enough swindlers doing that already. I want to give you the facts, like 'em or not, so you're empowered to take action and make positive decisions on how to succeed in the Forex markets.
There's nothing magical about the Forex markets, because all markets are ultimately driven by human psychology - fear and greed - and supply and demand. Sure, every market has its own peculiarities, but if you understand how the basic drivers of human emotions work, you can potentially succeed big in Forex market, because the market controls 95% of live trader's emotions. Some traders think it's a "get rich quick" trading the popular Forex markets.
There are many advantages of Forex trading over other types of financial instrument trading like bonds, stocks, commodities etc. But it does not mean that there are no risks involved in the Forex trading. Of course there are risks associated with Forex trading. Therefore, someone needs to understand all the terms related to Foreign Exchange carefully. There are many online sources as well as offline sources that provide hints on trading of Forex. These hints are basically the SECRETS.
As I said above, the foreign exchange trading is considered as one of the most profitable and attractive opportunities for investment as any person can easily do at home or office and from any part of the world. For succeeding the Forex trading, a person is not required to do any online promotion, marketing etc. The only requirement in the Forex trading is the account that a person is required to open with reliable and registered brokers, a computer system and fast internet connection.
Now, you have to be careful when opening a Forex account with any broker because some could be SCAM. The Commodity Futures Trading Commission (CFTC) in US has jurisdiction over all Futures and Forex activity. When trading in the foreign exchange markets, individuals should only trade with a CFTC registered entity that is also a member of the National Futures Association (NFA) and is regulated by the CFTC. For non-US broker/ bank entities, be sure that the broker or bank is registered with that country's appropriate regulatory bodies.
The Forex account could be opened with any amount between $300 (mini) and $2000 (standard). After opening the account, a person is required to learn how the Forex market works, demo trade and after a while go live trading. Moreover, there are some secrets that have to be followed.
A person can also apply all the secrets when demo trading and can see if the secrets really work. It could be said without any doubt that if someone can apply all the secrets in right way, he/she can easily gain good money by way of Forex trading.
All successful traders have Forex trading strategies that they follow to make profitable trades. These Forex trading strategies are generally based on a strategy that allows them to find good trades. And the strategy is based on some form of market analysis. Successful traders need some ways to interpret and even predict the movements of the market.
There are two basic approaches to analyzing the movements of the Forex market. These are Technical Analysis and Fundamental Analysis. However, technical analysis is much more likely to be used by traders. Still, it's good to have an understanding of both types of analysis, so that you can decide which type would work best for your Forex trading strategies.
There has been misconception about the Forex market because there are different types of traders and advert out there full of exaggerations that makes the business unreal to so many people and that is why I am here to show you the SECRETS in Forex Trading.
What is traded on the Forex market? The answer is money. Forex trading is where the currency of one nation is traded for that of another. Therefore, Forex trading is always traded in pairs and the most commonly traded currency pairs are traded against the US Dollar (USD). They are called 'the Majors'. The major currency pairs are the Euro Dollar (EUR/USD); the British Pound (GBP/USD); the Japanese Yen (USD/JPY); and the Swiss Franc (USD/CHF). The notable 'commodity' currency pairs that traded are the Canadian Dollar (USD/CAD) and the Australian Dollar AUD/USD. Because there is no central exchange for the Forex market, these pairs and their crosses are traded over the telephone and online through a global network of banks, multinational corporations, importers and exporters, brokers and currency traders. But if you really want to make it big in the Forex market, I will strongly advise that as a "beginner" in the business. Kindly get acquainted with one or two major currency pairs. Study them very well and make sure you understand their volatility period.
And to further simplify Forex trading, you could easily limit your trading to the two most liquid and widely traded pairs, the EUR/USD and the GBP/USD. This really starts to reduce demands on your time for trading activities without giving up good profit potential.
Traditionally, currency trading has been a 'professionals only' market available exclusively to banks and large institutions, however, because of the invention of the new E-economy, online Forex trading firms are now able to offer trading accounts to 'retail' traders like you and I. Now almost anyone with a computer and an Internet connection can trade currencies just like the world's largest banks do.
Do you want to know how to trade the forex market without losing a dime?Then go over to [http://quickforexpips.blogspot.com] you will get free tons of information there.
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