FOREX 101


While there are many investment vehicles to put your money to work these days, none are as large, and potentially as lucrative as the foreign exchange markets. With a daily turnover of over $1.4 Trillion! (yes you read that right…daily). Needless to say it offers a freedom that many other markets just cannot compete with.

Along with the fact that it is a huge market, it also comes with a stack of other benefits…

Anytime…anywhere
Open 24 hours on weekdays, the fx market gives you the ability to trade any time of the day or night. Compare that to other markets that operate at specific hours of the day, the forex market is a buzz of activity and opportunities throughout the week. Investors can react to specific news events and trends that happen within the week, anytime.

Freedom
This also gives traders another type of freedom. The freedom to choose where you work, and when. This has allowed many new traders enter the market that may work during the day. If you have a laptop, then you can trade no matter where you are!
Less Cost
Due to the size, and daily turnover of the fx market, and the fact that it is traded electronically, the costs of trading are far less significant than trading normal equities (shares/stocks). The majority of fx trading cost is built into the opening spread (the difference between the buy and sell price when you enter the trade). The spreads here are usually smaller than the spreads in other markets, which again makes the ability to earn a profit much easier.

Leverage
Unlike other markets where leverages are small, forex trading allows for bigger leverages, giving you the chances to trade (at times) up to four hundred times your investment. Of course, like any investment of this nature, leverage also carries a significant degree of risk. Thankfully with the forex market in particular you can easily manage your risk. At times risking only a handful of dollars per trade in order to place your trade.

Stable Price
Since your trade is executed immediately, your trades are done with precision, and you have less risk that the prices will slip if you set up orders to enter at specific prices. Due to the rapid nature of the markets, you can be in and out of a trade and not have your funds tied up in the markets.

Transparency
With the speed, liquidity, and popularity of the fx markets this also means that the market moves in predictable patterns. This means you can formulate a trading plan based on these repeatable patterns, and ensure you can predict the market with a certain level confidence and consistency.

Stable Profit Chances
Since your trading involves two currencies and not other markets and trends, one always has the opportunity for profit. There is no bulldog watching of rising or falling of markets, goods and industries. Whether the market is bullish or bearish does not really need to worry you. What really matters is that you pick the right currency to trade.

Forex trading is considered the perfect competition for logical reasons. Everybody is presented with an equal playing field. Even if the currency is falling, it just means that there is currency rising somewhere and the opportunity of profit exists. An unlimited earning potential, the freedom, and the even opportunity makes the foreign exchange market an exciting opportunity for anyone.

What To Avoid With Your Automated Forex Trading System


Automated Forex trading system is an answer for some traders. Some would say that using this kind of system enabled them to win and earn profits that they would unlikely earn when doing manual trading. Successful users of the Forex trading software would say that not only would they earn money, but they would earn it consistently.

But not everything is a walk in the park. There are traders that would say that getting an automated system and using it for their Forex trade did not help them at all, worse even made them lose profit. Actually, failure in using the automated Forex trading system would depend on the how we take advantage and use this system. Some would commit common mistakes which they can readily avoid.

What are the things that we should be conscious about and at the same time what are the commonly made mistakes when using the automated Forex trading system.

Mistakes would oftentimes start when you are just beginning to choose your Forex trading software. Of course you can check the testimonials of the customers. But do not solely rely on them, it can be fictitious testimonials. So, what you can do is check forums where not only opinions about the software are tackled, but also about the problems encountered and how customers were able to resolve them.

Another mistake is that traders would think that just because that the software they want got god ratings in the market and good customer feedback, it is already perfect. It can still encounter some problems on the way. So make sure that the software you will be choosing have a live support, whether it is over the internet or phone.

It is also a mistake to believe that since you have a trading software, losing is next to impossible. Even the best and most expensive trading programs, can still make mistakes and in the end, make you lose some profits. Winning and earning big profits does not happen in a matter of weeks. In Forex trading, you could have fewer transactions but these transactions could give you more profits. You would have to build solid transactions andtrades that can give you bigger accumulated profits in the long run.

Some would think that winning trades could happen everyday. But that is not the case. Very good deals and trades do not happen everyday. You need patience to be able to earn big profits. Making a lot of trades or overtrading does not mean you would be able to get big profits in the end.

Some traders would rely too much on their trading software and forget getting involved manually on the trade. Being lazy in learning your trade is a big, big mistake. Just because computer programs are working for you, does not give you any excuse not to understand and learn the Forex market.

But listening to all experts and following what they say do not guarantee success altogether. Knowledge is meant to compliment your trading style and system. Just because they say that a particular strategy or system works for them, it could also work for you.

Also, if you have encountered a bad software in past, do not think that all Forex trading programs are scams. It is a mistake to stop looking for ideal trading software. Be patient and keep looking.

It is common for everybody to make mistakes, even if you are using an automated Forex trading system. You just have to make sure that your software compliments your trading style and knowledge.

Strategies You Can Use In Forex Trading


Being a trader in the Forex market has its ups and downs. There are times when you earn lots of profits but there are also times when you lose a great deal too. Foreign Exchange is a complicated, profitable, and risky endeavor. If you’re not ready to take some risks, you can’t be an effective and efficient trader.

Are you aware that the Forex market is the largest market to conduct trade all over the globe? This is true and so if you want to earn more money, learn how to trade in the Forex market.

Currencies are traded in the Forex market. This market was primarily created to meet the demand and supply of different kinds of currencies by individuals, companies, and government. It was also created to assist exporters and importers. Most of the traders are investors, businesspersons, speculators, businesses, and those in the industry of banking.

As you probably know by now, countries have different kinds of currencies. The values of these currencies also vary. In Forex trading, two currencies are being traded which are also called ‘trading pairs’. When you sell a currency, you’re also purchasing another. For example, you can get the British pounds by using US dollars. If there is a small supply of British pounds, you will need to pay more US dollars. In this transaction, the buyer of the British pounds hopes to sell it at a much higher price (more than what he ir she paid for it).

Speculators accept the risk of any adverse movements in the exchange rate and in the case of a favorable currency movement, the speculator can earn lots of profits.

You must have your own trading system. This is a must for all traders and beginners in the industry are encouraged to develop their own system. For starters, you can start with a small investment. With the system in place, you can easily decide when to enter the market and when to exit. The cost for every transaction is very minimal and so you can trade for as many times as you like in a day; besides, the Forex market is open round the clock.

It’s quite hard to manipulate the Forex market because it is extremely huge. The market is also often influenced by global events and news. Insider trading is definitely eliminated because of these factors.

Never enter the Forex market with limited knowledge. You must be aware that around 90% of all Forex traders suffer great loses. Only 5% are able to gain profitable results while the remaining 5% are only break-even.

You will need to have adequate knowledge about the Forex market. You can start by researching online for useful information about Forex trading. Try to choose among the many Forex software programs available in the market and you have to ensure that you’re using an efficient program. That way, you can easily monitor the activities and changes in the Forex market online. With an internet connection at home and efficient trading software, you can make educated transactions. You can’t rely on sheer luck if you want to succeed as a trader. You need to study and analyze the market trends while considering market indicators and generators. You can also get a broker to help you out with your trading concerns. You can’t keep afloat in the Forex market without adequate help and knowledge. Know the strategies to use.