Forex and the Risk Element

Time and time again I hear the statement that trading on a margin account is a risky business. In fact the NFA and CFTC require that all brokers and agents inform the public of the risks of trading on the foreign exchange.

So how much risk is actually involved in trading Forex? Is it any riskier than engaging in any other kind of business?

Let us first look at the hypothetical case of John and Mary. Each of them opened a forex trading account and funded it with $50,000. Both of them operated on a margin set at 100:1

John traded very conservatively using one regular lot per trade and applying reasonable money management principals. Unfortunately, John was a poor decision maker and did little to improve his trading skills. Over a period of time, John lost his entire investment.

Mary had no intention of being shackled by the constraints of money management and traded to the maximum of her account margin, each trade carrying the maximum lot size permitted. After a few spectacular gains, Mary's luck ran out and her account was wiped out. Despite being in profit to the tune of $2,500,000 she had lost it all and her original investment was gone too.

So who took the most risk?

If you answered Mary - you are wrong!

Mary is a multi-millionaire. She has several mansions two yachts and a private jet. Her main income is from oil and her company owns some of the largest oil reserves in the world. The possibility of losing $50,000 for Mary is a very small risk. It is similar for her to that of anyone purchasing a lottery ticket - nice if it gives you a few million dollars, but no big deal if it doesn't.

John on the other hand was in a very different situation. John had taken a mortgage on his house to fund his trading account. He had no savings and had even given up his job to start full time trading.

As you can see from the two tales above, risk is about more than what percentage of your account you put at risk.

In our next example, Mike and Sarah both open mini accounts with $5,000. Both are using a margin of 100:1. Neither Mike nor Sarah are independently wealthy but each can easily afford to lose their $5000 without it adversely affecting their lives.

Both start trading and due to lack of experience do not fare very well. After a short time Mike stops live trading and starts to practice in a demo account. Mike seeks help and knowledge and then practices in his demo account to hone those new found skills.

When Mike starts to trade his live account again he uses very strict money management and a well developed trading system. Mike has not yet made a fortune, but he is starting to recover some of the investment that he lost.

Sarah continued to trade without any help. She is still managing to stay afloat.

So who was at the most risk in this example? I would suggest that it was Sarah. Her luck is still holding but if your trading style is built upon luck. You are at great risk.

Trading the forex market requires that you develop a style of risk management. It is necessary to understand the true risk of each trade as it applies to both the market in general and to you in particular.

If you always trade with money that you can afford to lose, your total risk is reduced. If you learn how to trade effectively, then your risk is further reduced and likewise if you adopt a strict regime of money management your risk is again reduced.

Trading will always carry a level of risk. If you intend to adopt trading as a career or investment vehicle, it is up to you to do everything in your power to learn how to properly assess and manage the risk.

Picking Up Forex Signal

There is lots and lots of Data forex and forex signal trading on the internet. You need to be extremely cautious and careful when finding the right forex signal to follow. Basically a forex signal is a way some people use to invest there money. A Forex signal is also fore people to follow who usually do not have time to research on how to invest on a daily basis. You need to be careful though, most people will completely ignore any forex trading signals because they have been scammed to many times.

Do you know the best way to prevent being scammed? EDUACTION! The word you can’t get enough of. If you educate yourself your will run less risk of being scammed than anyone out there. Remember the forex market is the largest market in the world which consists of over 2 trillion dollars traded on a daily basis! 2 TRILLION! That 2 trillion is mainly made up of multi-national corporations and large financial institutions. Single investors are starting to make an impact in this market today.

So what exactly are online trading signals? These are services offered buy a lot of companies out there today. You can either buy or sell these signals. If you want this type of service you may find yourself spending thousands and thousands of dollars a month and it may not even be worth it. What you need to do is learn forex the right way. Start out with forex training sites that let you train with “play money” to get a feel for this market. You can create an account for free and trade as much as you would like with play money to get a feel for what it would be like with real money. This is seriously the best tool out there that you need to take advantage of right away.

The more experience you gain on a daily basis, the more knowledge and know how you will have to perform well in today’s highly liquefiable forex trading market. The trouble with people today is they like to jump into this market or spend thousands of dollars a month on some “so called” expert currency trader, which in fact is no better than you! You need to seriously stop throwing your money away and start learning the forex currency trading on your own. All you need is a great forex currency ebook and a never give up attitude willing to take risks. You do not need to break your pockets either. You can start out in the forex trading market for as little as $25.00! 25 dollars has the potential to start earning you thousands and thousands of dollars a day. For a nice meal, you have the potential to grow into a multi-millionaire. Sounds too good to be true? It is not at all! You need to nose dive head first into this untapped and unregulated market. There is no limit on the amount of earning potential you can earn in this market. The sky is the limit!

It Really Pays to Learn FOREX

The fact that foreign exchange trading can be very profitable makes it exciting, but there is one important aspect that shouldn’t be overlooked. The risk factors in FOREX trading are significant. A good FOREX trader must fully understand margin trading and the implications that it has, as well as the particular opportunities and pitfalls offered by foreign exchange trading.

There are many reasons why the foreign exchange market is so popular and why some many traders want to learn FOREX. Some of the most important reasons include the high liquidity, the 24-hour availability, the very low dealing costs, and the leverage available.

Participants in the foreign exchange trading include many commercial organizations, but their presence on the market is related to currency exposure due to export and import activities. However, it is the financial institutions that are responsible for most of the turnover on the FOREX market. Banks, funds, brokers – these are the major players on the market, and investing in FOREX is still predominantly their domain. Still, any investor can make the most of these advantages, provided that he/she has solid knowledge of the functions of FOREX market.

Due to the advancement of technology, a FOREX trading account can be opened, and individuals can start trading, without becoming involved with a trading institution or a bank. But the question is, are you ready for FOREX trading?

It is highly recommended that you learn FOREX before you actually start trading. As stated before, this market offers some opportunities that allow the prospect of huge profits. But the losses can be just as big as the profits, and no one wants to learn FOREX by trading their own money. Fortunately, there’s no need for any of your money to be lost before you can crack the code and really master the FOREX market functions. Thanks to the same technology, you can chose a FOREX trading course and learn everything you need to know about this way of making money, a lot of money.

There are excellent websites offering powerful FOREX trading courses that provide you with all the necessary information, including tips and secrets of foreign exchange trading that you can use to your advantage. Think about it, if you start to trade on the FOREX market without having learned FOREX, you might as well throw your money out the window. However, if you learn FOREX before you start investing, chances are you will do very well. But learning the basics will only get you among the other traders for whom stress is a constant feature. You need to choose a good FOREX trading course that will put you on top of the other traders, and give you the ability to make serious profit. And the good news is that such a course really exists!

Trading on the FOREX market does not come with any restrictions of time and place. You can live in any corner of the world you please, or you can travel anywhere you like, as long as you have access to a computer and an Internet connection. And it gets even better. You don’t have to start with a huge sum of money, a small amount will do, and soon you’ll be making so much money, that you’ll feel sorry you haven’t considered trading foreign exchange sooner. The only condition to being really successful is that you learn FOREX from people who have had and still have their share of the market.

Forex Trading Journal

If you are serious about trading successfully, you need to be keeping a forex trading journal. I remember a long time ago when I first got started trading, I was just doing so so until the day when I decided to start keeping a trade journal.

Your trading will see drastic improvements pretty quickly when you start keeping a journal because keeping a trade journal sends signals to your entire being saying that you are serious with whatever you're doing.

So if you're with me so far and want to start your own trade journal, read on and let me give you a guide as to what should be in your trade journal.

#1 - Record Date and Time of Trade

This will help you refer back to the charts and see when you entered and exited the trade

#2 - Record Currency Pair and Direction

Record which pair you were trading at that time ... be it GBPUSD or EURUSD or whatever. Also record if it is a long or short trade. E.g LONG EURUSD

#3 - Record Your Trade Entry Price

This is a no brainer ... I personally use Excel for this.

#4 - Record Your Exit Price For Your Trade

The difference between your exit and entry price will determine whether your trade is a profitable or loss trade.

#5 - Record Your Trade Size

In other words, how many lots did you take on that particular trade? If you're trading in mini-lots, record that as well.

#6 - Record Your Nett Pips

Record in numbers ... That way you can see your trading performance at a glance. E.g -22 pips or +34 pips

#7 - Record Your Nett P&L

Make a record of how much you made or lost with that particular trade in terms of dollars and cents. By doing so, you can see which are your biggest losers.

#8 - Record If You Were Trading Countertrend or With The Trend (Optional)

I'm personally very detailed and so I record this sort of details as well.

#9 - Trading Session

If you like you can also record the session you were trading in such as european open or asian close.

#10 - Screenshots (Optional)

Sometimes it will really help when you take screenshots of what you saw at that time you entered the trade.

#11 - Additional Remarks

This column or detail is good for recording how you felt about the trade (before and after it)

You can use your favorite document editors such as excel or word for logging your trades. Ok, this pretty much wraps it all up. Reading all these doesn't help you as much as actually doing it so if you've not been keeping a trading journal, why not do so right now?

Happy trading and happy journaling!

Forex Pivot Points

Forex pivot points are a valuable tool which needs to be used with any time of forex trading. If you are new to forex trading and are just starting out, you must understand that this is a risky but highly profitable business. When you are starting out in forex trading you must understand that a lot of work goes into being very profitable in this business. The great thing is though; you do not need much capital investment when starting out. $300.00 or less can get you a long way in this investing wheel.

Before you jump into forex trading you must understand the basics and without a doubt you must understand that this is way different than trading stock. You must study the global and local markets as a whole and any trends will affect any of these markets. Forex trading is a highly liquefiable market in which you can exchange currency 24 hours a day.

Without the proper training in the forex industry you must be prepared to fail. You need to devote a lot of time to learning the forex system in its entirety. The worst thing you could do is jump right into forex trading not knowing a thing, and risk losing thousands and thousands of dollars. You can go into online forex situations which present you with real life trading events and you can make real life decisions, but all it will cost you is play money. You can see how much you would have gained or lost depending on the market. This is a great training mechanism and will gain great experience in order for you to truly understand forex trading.

I recommend you use a forex platform trading mechanism that will net you great money and great results. Even some predict forex software can help you score millions. There is some high tech software out there that can even teach your what the currency exchange iraq can be. It doesn’t matter what currency you are actually trading for, as long as it is profitable. Knowing when to invest and how to invest your foreign currency will be your one way ticket to success. The forex market is a wide open, highly profitable market. Check out the free forex forum and chat room next time you are snooping around on the internet for as much free forex information as you can. You can even go to a forex seminar to increase your chances and raise your profitability of making money for as low as 100 bucks.

The greatest way to learn forex trading is through forex ebooks offered through many established sellers. Learning as much on hands information with a guide to follow will be your best way to earn lots and lots of income. There is tons and tons of forex software out there, you just need to be careful what you buy. I highly recommend you stay away from such software and focus yourself more towards hands on learning and forex ebooks. As always, I wish you the best of luck in your trading!

Trade Currency for Profits

Foreign exchange trading, also known as Forex trading, has become more and more popular with investors and traders these days. With the ongoing recession in the capital markets, a lot of folks believe buying and selling of currencies is a safe investment. Whenever you look at the mechanics of a currency spot trade, the chance of making money is somewhere around 50%. With each currency spot transaction, someone loses money while the other individual makes some. Despite this, not everyone is profitable from trading currencies. As a matter of fact, it is estimated that almost 80% of all currency traders lose money in their attempts.

Using these statistics, one can easily assume that the 20% of profitable traders either have access to some kind of insider info or a mysterious way to manipulate the market. But even the United States, British, and Japanese governments have systematically failed in their previous attempts to manipulate the world's currency markets; which squelches that possibility all together.

The fact is, profitable currency traders are simply better at using accessible info than their unprofitable counterparts are. Profitable traders know how to choose the most applicable information from the enormous heap of economical data that's released by governments and institutions on a day by day basis. They understand how to head off information overload and zoom in on exclusively the most important facts and numbers that are most probable to have an effect on the currency market. With that in mind, these are the five major national economic reports that each successful trader looks at:

Unemployment Reports. Unexpected surprises in unemployment figures generally have a big impact on the Forex market. If, for example, the anticipated unemployment rate is 6% for a specific country, but the report shows an actual rate of 4%, then this can cause a strengthening of the national currency.

Interest Rates. Interest rates are directly related to the strength of a specific currency. When interest rates move up, it draws in foreign investors and will lead to a stronger currency. The opposite takes place when interest rates go downward.

Consumer Price Index. The CPI is a monthly report that measures the costs of goods in a country and compares this to salaries. An abrupt hike up in inflation is always damaging to the strength of a currency and so it's vital to maintain a close eye on this economic indicator.

Trade Balance. The trade balance measures how much a country exports and how much it imports. A trade deficit means that exports surpass imports and a country is sending out more money than it is taking in. This has a very noticeable impact on the demand for a countries currency. But one must remember that a trade deficit isn't always a bad thing. One must take into account the specific conditions of a country to see why a trade surplus or deficit exists.

Retail Sales. A monthly report of retail sales is possibly the most effective indicator of the average person's thoughts about his nations economy. Sentiment plays a highly critical role in spending patterns, which, in turn, affects the strength of a nations currency.

For currency traders who may plan on being intermediate or permanent players, successful Forex trading means that you need to gain some basic knowledge about worldwide economics and trade. Trading currencies without an awareness of the economic circumstances that bear upon a particular currency market will ultimately lead to losing money. To earn money with Forex trading over the long-run, you also need to learn how to adhere to stable trends and indicators and place your orders accordingly. That is the surest, if not the only way, of trading currency for profits.

Effective Forex Training

It's important to succeed at Forex trading, is it not? So, what's it like when you imagine quickly and painlessly trading the Forex successfully?

Then, just imagine how great you'll feel when you can quickly and easily spot the market conditions and setups that will lead to successful and profitable trades.

It's easy to do for traders who use proven methods , tested Forex trading strategies, and most importantly good coaching and training. After all, winning is what proven coaching and Forex training does for you.

The role of the truly effective trading coach is to create the right conditions for learning to happen, and to continually motivate their students. Most Forex traders are already highly motivated and therefore the task is to maintain that motivation and to generate excitement and enthusiasm.

The roles that an effective trainer/coach undertake are many and varied. At some stage they will be your: instructor, assessor, friend, mentor, facilitator, demonstrator, advisor, supporter, fact finder, motivator, counselor, organizer, planner and the fountain of all knowledge - so it's important to find a good one.

With the thousands of different Forex training courses available, how do you know who's got one that works? There are many to choose from, all making the same claims. Plus, Forex training is notorious for being filled with charlatans out there selling their get-rich-quick snake-oil.

The reality is that not everyone can make thousands of dollars overnight. If you could, we would all just buy the latest "Miracle Money System" DVD set for $500 and quit our jobs tomorrow. Yeah right!

The problem with being new to the Forex is that you don't know who to trust. So let me show you seven "must haves" to get a real, genuine education in Forex.

You should get, as a minimum:

One - 24/7 Access to online training materials - professional videos, recorded live trading sessions etc. It's important to be able to have access to them on your own time, and at your own pace. Plus, it's nice to review things when you're trading.

Two - A comprehensive written manual - some people learn better by reading than watching videos and nothing can substitute for well written teaching materials.

Three - Look for courses that offer live interactive sessions that let you look over the shoulder of a professional trader in real-time. These should be offered at least monthly but weekly or daily is even better.

Four - You want live monthly extended day-long online classes that allow you to review, all the information you received, get updates on the current market, and learn what's working now.

Six - One-on-one mentoring (this one should probably be #1) to give you specific actionable trading advice. Encourage you to make progress and correct bad trading habits or techniques. This is the big one! Nothing works better than personalized coaching.

Seven - The live onsite option - Look for courses that offer periodic onsite training opportunities. An in-person seminar has its own dynamic and its own unique learning opportunities that you miss in ebooks, videos, or email and telephone mentoring.

Look for those seven features in a Forex training course that is offered by a successful professional trainer, with proven abilities to teach. After all, just because someone's a great trader does not mean they can teach. Michael Jordan was a legendary basketball player, but openly admits he can't coach.

Remember, success comes with commitment and action "period".

Forex Swing Trading

Forex swing trading is easy to learn and apply and is an ideal method for novice traders to make money with – let’s look at the advantages.

Essentially you have 3 time frames you can target trends in and they are:

Forex day trading, swing trading and long term trend following and forex swing trading is the easiest for novice traders - so lets compare these 3 methods and see why.

1. Day Trading

More novice traders try this method than any other - but it doesn’t work at all!

All short term volatility is random, you can’t get the odds on your side and you can’t win – PERIOD.

For those of you who are still are thinking about it – try and find a track record that has made real profits (not simulated or hypothetical) and you won’t find one.

It’s a loser’s game, so don’t try it.

2. Forex Trend Following

This will give you the best profit potential if you can lock into the long term trends and hold them.

This looks a lot easier than it really is and requires tremendous discipline and discipline is a hard skill to learn.

1. You need to be patient.

You need to wait for the right opportunities and it requires discipline, to sit for weeks or months on end waiting for them.

Most traders want to be in trading and trend following simply only suits patient traders and most are not.

2. You need discipline to accept big gains!

This may sound easy as we all, want to make big gains but sitting on a big open gain while volatility eats into your gains is anything but and most novices snatch profits early – trend following is simply hard - sure you can learn it, but if you’re a novice trader swing trading is a great place to start here’s why:

3. Swing Trading

You can swing trade with just a few indicators and support and resistance and the advantages are:

1. It’s very simple to learn and apply. You can learn a swing trading system in a few days.

2. There are trades at least a few times a week, so for the trader who likes action they will see it quickly.

3. Trades are right or wrong quickly and the discipline and patience needed is less in this than in trend following.

Its very easy to do – you are trading for periods of 2 days to a week or so and its easy to master the mindset to do it to and while the profits maybe smaller per trade than trend following, you can make huge profits over time if you have a logical robust system.

A Basic Swing Trading System

A swing trading system is easy to build and a good one would be based upon trading into support and resistance.

You then use momentum oscillators to confirm the trade and price direction is with your trading signal and finally, always have a target no trailing stops – hit the trades, hit target and bank them.

Stop losses in association with support and resistance are obvious and finally, incorporate breakouts in your swing trading strategy for greater profit potential.

Forex swing trading is easy to learn, easy to apply and can be profitable and fun – discover it and see for yourself.

Forex Trend Following

If you want to make money in forex trading then you need to learn forex trend following and how to lock into the big trends and milk them for all there worth. The big trends last for months or even years and can offer fantastic profits, if you learn to follow them.

So how do forex trend follow correctly?

Let's start with some basics:

The big trends in currencies last a long time, because they reflect economic cycles and they last for months or years, so currency trends do too.

Forex trend following does not mean trying to day trade or scalp this is a way to lose money, as all short term volatility is random so don't try it.

How do you catch and follow forex trends? You need a robust, simple, forex trading system which is based on forex charts. Here are the basics of a system that will catch EVERY Big move.

Buy breakouts - FACT:

Most major forex trends start from new market HIGHS, so you need to buy breaks of resistance.

The more times a resistance level has been tested the more valid it is and if possible the time frames should be weeks or months apart. The more tests, in more time frames and the wider they are apart the better.

When you buy these breaks make sure price velocity is on your side.

You can find out by using some momentum indicators these are covered more fully in our other articles - but two great ones are the stochastic and RSI Indicators. If they support the break then you have a potential high odds trading signal.

The stop is then easy - right below the breakout point.

With this method you're not interested in trading for the sake of trading, you need to be patient as the big high odds trades don't come around every day and sometimes you need to wait weeks or even months for a high odds trade to present itself but they always do and when they do offer stellar profits.

Your not interested in trading for fun - your interested in trading for big gains so forget all the lows odds trades.

Once you have locked into a trend and it's underway, you need to get ready for the hard part:

Following the trend and this takes a lot of discipline.

The bigger a profit becomes the more tempted a trader is to take it or lock in profits by moving his stop. The bigger the profit becomes the bigger the temptation is to take it, that's human nature - but you must stand firm.

You are going to have to sit on open equity swings against you which eat your open equity however so long as the long term trend is intact, hold it.

Trail your stop very slowly and way outside of random volatility and accept the fact when the trend changes you are going to have to give a good chunk back - but that's ok, if you caught 70% of every major trend you would be very rich.

Forex trend following is all about having a simple system, being patient, buying valid breakouts and following breakouts with discipline - its not easy to do - but if you can do it, you will make huge gains and enjoy currency trading success.

Top-ten Mistakes Forex Traders Make

You are ready. You’ve done your homework. You have read the all right trading books, watched all the right professional trading videos and attended a few of the right live seminars presented by big-name professional traders. You’ve researched your brokers, did your trials of various electronic trading platforms, and have your trading account ready to go. It’s day one of your new career—hopefully the one that will finally send you down the road to financial freedom. Congratulations, you are now a FOREX Trader.

But the odds are against you. You know that. You’ve read the statistics and heard the critics; but you are confident you won’t be the one to fail. You have the best trading system and you have planned for every contingency you can think of. Your charts, analysis and research are up-to-the-minute and instantly ready for every market you are going to trade. It’s go time. You take a deep breath and click the mouse…your first trade is LIVE; you’re in the game.

Fast forward six months. Your account balance is lower than when you started. Sure—you had some great trades and looking back, your analysis of most of the markets you traded was correct; but where is the profit you could have had? How did this happen? How do you get back on track?

I’ll tell you how it happened—because it happened to me; more than once. It happened because the real world of trading and the textbook world of trading are two completely different things. You need to be ready for that reality or you run a very big risk of being the one who makes part of the statistics.

If you want to read the whole story of how I got to be a professional FOREX and Futures trader pick up a copy of The Art of the Trade (Wiley & Sons publishing August 2008). I think you will be surprised to learn what is really required to be successful. In fact, I bet you are downright shocked to discover what is required.

If you would rather not read another book and simply want to get down to making your fortune, then I would encourage you to at least take the next few pages very seriously. Find a way to keep the thoughts you find here at your fingertips and consider them equally or more important than all your pre-trade preparation and analysis. If you seriously want to avoid the worst that could happen; then take some advice from someone who knows.

Before we get to The Top Ten Mistakes FOREX Traders Make, I want to give you some perspective. I started my career at a time when the markets were only just beginning to see the growth and public interest that they have today. The technology you and I take for granted today hadn’t even been invented yet. It took me years to learn what I needed to learn to be successful, without any of the help you have available FOR FREE anytime you want. You need to accept one very critical thing: the most important part of lasting trading success has nothing to do with the markets. It’s all in your head. All this FREE stuff is not going to offer you an easy road.

If you are willing to consider that the human element—the way you think and how you behave—is the REAL variable to lasting trading success; then I think you will get where you want to go a lot faster and with a lot less headache. If you are ready to get serious about your personal trader psychology then please come to my twice daily FOREX training sessions. If you really want to avoid the disasters you have read about then take my advice; don’t make these mistakes.

So let’s get’s started…

MISTAKE # 10

PAPER TRADING TOO LONG

Paper trading is hypothetical trading. If you have never traded anything before, you will probably do some paper trading. The benefit of paper trading is that it will help the new trader become acquainted with the basics of interfacing with the markets. This is often a “demo” account with a broker or clearing firm that provides real-time market data but provides a hypothetical balance. You are allowed to buy and sell as much as you want, just like in a “live” or “real” account. Your hypothetical gains and losses are accrued against your hypothetical account balance over time. As time goes on, most traders find that they can gain quite a surprising amount of paper-profits in a very short period of time. These traders are now completely convinced that they can easily duplicate those hypothetical results in real time with real money. They open their real trading account and POW! Within about three to four weeks they are down usually more than 50% of their equity. This is not my opinion—this is actual fact. Ask any broker in the industry what happens to “paper-traders” who open a real account. The ratio of “paper-traders” to “winning traders” is about one in ninety.

Why does this happen?

Because there was never any real risk to the trader.

Let me illustrate by telling you a story:

I am a private pilot. I soloed on my 17th birthday. In 1979 I was an Air Force academy appointee. I have flown a T-38 Jet fighter in extreme conditions. Just knowing that, I think most people would agree that I probably have a certain amount of experience flying airplanes.

Here in the suburbs outside of Chicago there is a small airport that has a “Fighter Pilot for a Day” program. This is where you fly co-pilot with a retired military pilot in high-performance aircraft. You are allowed to fly the aircraft (with the real pilot’s hands on the controls) in an attempt to “shoot down” an “enemy” fighter; which is another co-pilot flying another airplane with HIS retired military pilot. You are awarded a “kill” if your laser guns hit your opponent. It’s like a very expensive high-stakes game of laser-tag.

I went for a day to have some fun. As it turned out, I was flying against a complete novice. Of course, I didn’t tell him I had some Air Force training. I asked my adversary what kind of training he had. He very confidently told me that he was the top scoring “ace” from his on-line club and various other national methods of playing of high-tech video games. He told me that he could “out-fly” almost anyone in the Microsoft Flight Simulator in both the F-16 Falcon and F-15 Eagle. I agreed that his credentials were very impressive and proceeded to blow him out of the sky no less than six times in 20 minutes. To start with, this novice had never flown in aerobatic conditions so he spent most of his time trying not to throw-up. He stalled and spun most of the other time. If he wasn’t flying with someone he’d be dead. In the end he had to quit early because he simply couldn’t take the physical punishment. To add insult to injury, I have never played Microsoft Flight Simulator (ever). I do the real thing. BIG DIFFERENCE between the two as you can see.

Do you see the point I’m getting at? PRETENDING to do something is never the same as actually doing it. Yes, it is helpful up to a certain point to simulate certain things but that can only take you so far. In the case of air-to-air combat, PRETENDING to be a fighter pilot will likely get you killed if you ACTUALLY go up against a trained fighter pilot. In fact, the US Army Air Corps learned this the hard way back in WWI. They sent young men into combat with oftentimes less than 10 hours of actual flying time. Imagine how fast those men were killed when they went man-to-man with Richthofen, Boelke and Immelmann. Everyone concluded flying was “dangerous” when in fact it was the lack of training that was “dangerous”

I’m not trying to impress you with my flying skills. I’m trying to impress on you that paper-trading is exactly like playing Microsoft Flight Simulator. It is pretending to be something you are not while convincing you that you know what you are doing. Paper trading hides from you the need for real skills. Paper-trading will get you killed because when you go up against real traders with real money it’s not a game anymore. If you make the wrong move you lose equity. There is no “do over” button. If you stall your F-16 in the simulator, you get another chance; stall your F-16 in combat and you die. Lose money in your paper-trading account; just sign up for another trial account. Lose money in your real account and you go home broke.

Paper-trading is a waste of time because paper-trading will never give you the real skills you need to trade. All paper-trading can do is help you learn how to use the functions of your trading platform. In fact, that is a good thing. But once you learn the functions of your platform and your account is ready to trade, everything you learned paper-trading goes out the window because NOW IT IS DO OR DIE. There are no second chances.

Don’t make mistake #1; don’t think you know what you are doing because you pretended to trade without taking any real risk.

HOW TO MAKE THIS MISTAKE WORSE: Continue paper-trading for more than 30 days and/or go back to paper-trading if you have lost money in your first real account.

SOLUTION: Open the absolute smallest account your broker will allow and trade for 90 days the absolute smallest size possible. If you are ahead, increase your equity size and your trade size by a factor of 20%. If you are losing, stay with the real thing; it’s the only way to learn.

MISTAKE # 9

NOT HAVING A TRADING PLAN

Suppose you called your 401K manager this afternoon. Suppose you asked him “What is your plan for the next six months?” Suppose he told you “Oh—whatever. I just try to get on the right side and if I don’t I just get out”

How long would that guy be managing your retirement money if you had any say in the matter?

Many traders take the same attitude with their daily work habit and many don’t even know they do it. Not having a clear and concise plan for your daily trading presence is a serious mistake and you need to address it. The best way to describe a sound plan is to let you read one from a professional full-time trader. This is an actual trade plan form a friend of mine who is an E-mini trader:

2006 Trading Plan

My goal is to earn 100% on my trading equity before the end of the year. To maintain my focus I will set a near term goal every quarter to be at a 25% gain and I will plot my equity daily. If I reach my quarterly goal ahead of the last trading day of the quarter I will take a two-day break. I will hold any open positions that are at a profit but any open trade losses I will close at that point before I take a break.

If my open trade gains continue into the new quarter I will add to those winning positions by a factor of 25%. I will move my protective stops up to reduce my exposure on the entire position.

If I am behind on my trade goal for the quarter, I will take a five-day break. I will re-evaluate my trade system and ask the question: “Has my market quality changed to something my system is not able to perform at best?”

During the year I will not trade more than three markets. I have learned I cannot focus well on more than three markets at a time.

If I have more than four losing trades in a row in any of my three markets I will take a trading break for five days. Again, I will leave open position winners alone in the other markets but close all losing positions. I will again roll protective stops to reduce my risk.

When I take a trading break, I will enter resting limit orders in the open trade winners to take the objective profit should I be unavailable and the market gets to those levels during my break.

If I am ahead of my plan for the year at any point I will take a break. I will take 30% of the new equity out of my account and place that into a secure place. If I am behind I will not add equity under any circumstances. If I reach a 40% drawdown from my high equity I will quit for the year.

I will record my daily trade activity in my trading log and review this weekly. I will know my ratios and results; I will look to improve them by 5% each week.

I will trade only from the bull side because my analysis tells me that all three of the markets I have selected have more than a year of solid bullish fundamentals. I will learn how to use options this year because I see from last year I could have protected more trades if I had a solid grasp of when to use options and when not to. I will invest two-hours a week on option knowledge.

My son is leaving for Europe in May. I will not trade the week before he leaves or the week after. I plan to join him in the fall for Oktoberfest for one week and will not trade the three days before I leave or when I get back. I know I suffer from jet-lag so the week after I am back I am not at my best. I have blocked out these times on my trade calendar so I will not be tempted to trade anyway.

If you read between the lines you will notice that his trade plan included all the things that were in his control—NOT things outside of his control; like the markets. If you want to get serious about writing a solid trading plan pick up a copy of my first book Trading Rules That Work: the 28 essential lessons every trader must master (Wiley & Sons Publishing, October 2006). I also teach about trading plans in my daily broadcasts and in my Psychology of Trading course. Please see my website for details.

HOW TO MAKE THIS MISTAKE WORSE: Base your trading plan on hypothetical profits or on how well you did paper-trading, Ignore your personal emotional needs when compiling a plan, Ignore your family while making a plan, keep thinking you can trade everyday or all the time, average your potential over a period of time and think results will equal a daily amount.

SOLUTION: Ask a professional trader to show you his daily/weekly/monthly or annual trading plan. Ask yourself if you can make a plan that addresses similar things. If the professional you have selected can’t show you or won’t show you his plan then ignore what he has to say. If he isn’t using a plan then he is likely unable to assist you in building wealth. There are resources for writing trade plans on my site; please use them.

MISTAKE # 8

TRADING TOO LARGE FOR YOUR ACCOUNT

The fastest way to go broke is to bet it all—all the time. Most traders don’t learn this lesson until they have had at least one blow-out; by that I mean they have lost all their equity quickly and have had to start over.

For some reason, there is a tendency for traders of all age and experience levels to trade too large for the actual cash in their account. This is a symptom of a larger problem and unless you are willing to consider that you personally might have this problem already you most likely will be trading too large for your account right now today.

What is this larger problem?

GREED, BABY—GREED

It is unrealistic for you to believe you are going to make a killing on THIS ONE TRADE RIGHT NOW. Sure, you might be on the right side of a large move but that will take time and evidence to see. For this moment, any trade you have on has the potential to run the other way against you and if you are trading too large, your potential to lose a lot on only a few trades is huge. No matter your age, education, skill or experience level you are not going to make 100% winning trades. Therefore a certain percentage of your trades will simply not work. Those trades cannot be so large that you lose a significant portion of your equity in the process.

To beat the greed habit you need to make a few changes to both your equity management and more importantly to your thinking.

First, trading is a business. You need to treat it like one. There are certain things every business needs to run effectively and the first thing is liquidity. Simply put, if you run out of cash to play you can’t remain open.

Second, if you had a reasonable plan in place already then it is a good guess that your plan calls for only a reasonable amount of percent gain on your equity regularly. If you were to use some basic mathematics while creating a sound trading approach one of the things you would be looking for was a realistic “risk-to-reward” ratio. That means for every dollar you lose you expect to make a certain number of dollars and out of every 100 trades a certain percent will be winners and some will be losers.

If you put this all together and asked the “what-if?” questions you get this base-line number that statistically will be a winning set of results:

42% winning trades out of 100 taken

Two dollars out for every dollar you give back

This is not my opinion, this is the Probability of Ruin Matrix and you can research it yourself if you have time. Of course, if you have higher percentages of winners and take more out on those winners you make money a lot faster but the point is if your results are at least this good consistently you are on your way to success. I teach more about that in Trading Rules that Work and in my Psychology of Trading course.

It’s great to be on the high side of the matrix but most of us didn’t start there and that is why you have to TRADE SMALL at first. To protect yourself from being greedy about your trading and to help you stay focused on long-term success it is important to make your trade size small enough so that it won’t leave you in a position of not being able to play at all should you have a string of losses all at once. I found that limiting your risk/reward ratio to a factor of about 1.5% on any one trade is a great way to stay focused and not get greedy.

This means that for any one trade you take, no matter how you think of the trade or how certain you are of a win; you will not risk more than 1.5% of your account balance at any one time. This means that if you are trading so that your average loss is 3-5% of your account balance at any one time—you are trading TWO to THREE TIMES TOO LARGE for your account size. In that case, the Probability of Ruin Matrix will work against you and you will likely run out of capital before you make money with your approach.

If you are the greedy trader right now and you are guilty of making this mistake; If this means you have to drop your trading size down a few notches then you had better call your broker today and fix it—because if you don’t you are an accident waiting to happen. It only takes making this mistake THREE TIMES IN A ROW to drop your account balance 15% or more in a heartbeat; especially if you are day trading!

HOW TO MAKE THIS MISTAKE WORSE: Convince yourself you are so good at trading that this couldn’t possibly happen to you, convince yourself that your analysis is good enough to help you find 80-90% winning trades all the time, trade without a stop-loss order “just this once”, double-up on the next trade after taking a large loss.

SOLUTION: Immediately reduce your account balance; take 20-30% of your cash home. Trade position sizes that are no more than 300% as valuable as your account balance. In other words, if your account size is $10,000, don’t trade anything that has a total contract value larger than around $30,000. If that means trading mini’s instead of big-board you had better do it.

---------------------------------------------------------

We hope you’ve enjoyed the first few mistakes that traders make, and that it opens up your eyes to the Forex markets a little more! This is a mini version of our TOP 10, which we like to spread around for your overall knowledgebase, and to show you the quality you get with the Forex Brotherhood. Once you become a member with us, you get the rest of this guide, two daily live webinars/broadcasts, two daily hot reports, an automatic EA, a VIP forum to mingle at, and obviously a learning curve that will be shortened 10 fold with our curriculum and premiums.

Please consider me a friend in the business. I have many products and services available to you that have been created from my hard-won experience. They are all designed to help you do two things: Stay focused on what really matters when trading FOREX and stop making costly mistakes. I hope you will consider joining me and my online community for my twice-daily internet FOREX broadcasts.

Good luck and Good Trading

Forex Robot Revolution

More millionaires have gained their wealth from the stock market than any other one source. And now, automated currency trading programs like Forex Tracer are changing the way profits are being reaped, and those doing the reaping. A market once dominated by professionals is now gaining momentum with ordinary opportunists seeking and gaining wealth thanks to these smart robot programs. Not only are they capable of making profitable buy/sell decisions but they do what humans can't - work 24/7. As long as there is a market open somewhere, robots are trading and turning profits. So while you're making dinner, watching TV, playing golf, and even sleeping, you can be building wealth. And the trend isn't expected to stop anytime soon, if ever.

How does it work?

In plain English, computer programmers and seasoned currency traders have joined forces to write software capable of detecting peak buying and selling signals. Devoid of human emotion, and able to execute at precise moments, they rival or defeat even savvy professionals. No human intervention is required, or recommended. This is commonly referred to as "running on auto-pilot."

Sound complicated?

While the mathematical logarithms integrated into Forex Tracer are highly complex, the program itself is easy to use. No prior trading experience is needed. This is a large factor of its success. Not only are industry traders buying into it; but also are home-based business entrepreneurs, and other seekers of supplemental part-time income. Its inexpensive entry point, money back guarantee, and demo account features make an attractive package. Moreover, the upside potential is not just tens of thousands of dollars per year, but possibly hundreds of thousands. Not having to quit the day job to give this a go with a 30-60 day demo account before investing the nest egg is another sought after perk.

How much does it cost?

It varies by manufacturer with most systems listing in the $300 range. Forex Tracer at the time of this writing is offering a promotional price of $97. The recommended strategy is to run the test environment 30 days to see results prior to investing real dollars. Once the user is familiar with expectations, go the next 30 days with a live account. Accounts can be opened with as little as $500. With this approach, both demo account and live account results are realized within the 60 day return window offered by Forex Tracer.

Is it foolproof?

Demos will illustrate that while some trades will be negative; they are generally small losses with the majority of trades being positive and larger gainers. Thus the net is a gain. Running in the test environment will demonstrate this.

Where can I get more information?

The link below will provide additional information, including a compelling YouTube video capturing actual trading results from an experienced independent trader and tester.

Best Forex Expert Advisor

To find the best Forex expert advisor is indeed a daunting task as there is a vast amount of options available on the market these days. A Forex expert advisor is a sophisticated tool designed for the Metatrader trading platform which helps you make more intelligent and informed trading decisions in the market, and they can also completely automate your Trading if you wish. You can download the software's for free from some websites, while other programs that have been thoroughly tested and proven, require you to pay a certain sum to seek the services of their so called "Forex Robots".

Not all expert advisor are the same and they all contain unique features and benefits, depending on their trading plan and strategy. Some EA's are very simple and could've been designed by anyone who has a basic understanding of Forex Trading, while others are remarkably complex and require immense experience and knowledge within the Forex Market. This is why you will see some Expert Advisors out there that are priced a little bit higher than others; it also depends on how the EA has performed in Live market Conditions and if it can offer regular updates, however with that being said a good Forex expert Advisor can range from anywhere between $100-$400.

Recently expert advisors have gained immense popularity amongst the Forex Trading community, and I believe this can mainly be attributed to their exceptional benefits, which easily outweigh their costs. After purchasing a Forex expert advisor for a small payment its benefits are endless, they can help you make a ton of money off the Forex Market and also organize your time more efficiently, as they can be completely automated, meaning you don't have to sit infornt of your computer and monitor the market all day long. The money you invest on these systems can be made back within minutes as just one winning trade will probably lead you to get your money back and after that it is all profits (if you stick to proper money management techniques). Traders that are just learning the ropes of how the market works are easily attracted by expert advisors as they can help them make some money while they are still learning the ins and outs of the market. However I strongly recommend that you have a firm grasp of Technical analysis and how the Forex Market Operates before you purchase any expert advisor and risk your own money on Live Markets, this is just to make sure you know exactly what your doing and how the Forex EA functions.

Now before you go out and part with Your Hard Earned Money here a few key principles to consider when looking for The Best Forex Expert Advisor:

- Firstly always make sure that the seller of the EA is fully legitimate, there are a lot of scammers out there and you don't want to fall prey to these vultures. The best way to see if the site is legit is to look for an email contact, most likely if there is no email contact then the site is a scam and should be avoided.

- Look for a trading system that suits your trading personality and personal requirements. You may want an aggressive strategy with a moderate level of risk involved or you may want to trade with a conservative strategy with minimal drawdown. It is entirely up to you so make sure you do your research and look around to make comparisons of different systems to see which one is best suited for you and your situation.

- Always look for Forward Test Statements, or better yet Live Forward test statements. Live forward test are conducted on real money accounts in real time and are the closest things to letting you know how the EA will perform in actual live market conditions. Forward Test statements will easily let you know the profitability of a certain EA and are the most important things to look for when purchasing an expert advisor; do not buy an EA that doesn't provide Forward Test Statements.

- Lastly I believe it is absolutely essential that the seller of the EA is the creator of the EA and offers regular ongoing after sales support about his product. Ideally the site should contain some sort of a Forum, Live chat support or email support. By offering after sales support it lets you know that the seller is dedicated to making his system work for himself and others and is serious about helping people make money off the Forex Market. It also lets you know that you are in good hands as you will receive regular updates and will have prompt answers to your inquires if you shall encounter any problems.

Therefore if you adhere to the guidelines above then they will certainly help you when choosing a profitable Forex expert advisor and you should be able to give any expert advisor a through examination before you make any final decisions.

Best Forex Trading Indicators

What are the best forex trading indicators and how do you use them to make your forex trading strategy succeed? Here we will look at how to do just that.

Firstly, there is no such thing as a best forex trading indicator on its own, as no indicator works all of the time however if you combine the right Forex trading indicators you can build a robust forex trading strategy and seek currency trading success.

Here we are going to give you a subjective view, of the best forex indicators and how to combine them for success.

When trading forex markets, we always like to use simple bar charts and see support and resistance as the initial paint on the canvas. We can see support and resistance and the direction of the market clearly and then decide with our indicators areas of value to buy and sell.


Here are some indicators we have been applying for 25 years and have made money with and the some advantages we think they give to any trader.

Simple Moving Averages

We all know prices come back to an average and we find the most useful the 40 day MA, for defining the biog long term trends and in strong trending markets, we like to buy or sell back to the 20 day MA, to enter fresh positions in the direction of the trend.

Bollinger Bands

Gives you the volatility of the market and they are a great help in determining the standard deviation of the market from the norm. This of course gives you clues to overbought and oversold scenarios, entry points and targets.

Anyone who trades forex, needs to be aware of volatility and standard deviation, so make it part of your essential forex education and use Bollinger Bands.

While you can see trends support and resistance and volatility, this is just setting up areas to trade now you need to do market timing. You should never predict a move, you should always confirm it with momentum indicators to get better market timing.

Here are two great forex trading indicators to do this.

Relative Strength Index

A great indicator you can use it to time entries if the RSI is in your favour and strong, in existing trends - or when it diverges from trends ( particularly when its over bought or over sold) to enter contrary trades.

Stochastic

We love the RSI - But our ultimate indicator to trigger trades is the stochastic; it's simple and very effective. We always use crossovers to confirm any move we are looking at. In contrary trades we love stochastic crosses with bullish or bearish divergence ( from over bought or oversold areas) against the prevailing trend.

A Great Toolbox Of Indicators for Any Forex Trader

So there you have our best forex trading indicators and they can be used for trend followers, contrary trading or swing trading. We can't give you every advantage of them here but look them all up and study them and you can blend them, into a powerful forex trading strategy for profit.

Best Forex Training Programs

It has been statistically proven that only about 5% of Forex traders actually maintain consistently profitably results. Although there are other factors involved experts agree that the main culprit for this is a lack of education and knowledge of the Forex market. Nothing can guarantee your success, but choosing the best Forex training program or Forex trading course will definitely put the odds in your favor.

There are many programs available, but not every one of them suits the needs of every trader. Below are some important aspects to consider when searching for the best Forex training program.

One of the first indicators of a good program is the content. Many programs and courses spend most of the time going over the basics, and although they are important, just learning the basics isn't going to allow the student to create consistent results in the long run.

The best Forex training program will cover much more in depth subjects like technical and fundamental analysis and the three pillars of Forex trading. Lets take a brief glance at these.

Technical and fundamental analysis are the two main approaches adopted by all successful Forex traders. Technical analysis attempts to forecast future price movements by examining past market data while fundamental analysis studies the core underlying elements that influence the economy of a particular entity.

Now lets look at the three pillars. If a course does not mention these then it is definitely not the best Forex training program.

1) Money management.

Many successful traders consider this to be the single most important factor of trading. It helps to increase profits while at the same time limit your losses.

2) Forex trading system development.

If you want to have consistent profitable results it is a necessity to have a good system in place. If you ever second guess your system then it is not the right system for you and you need to move on and try something different.

3) Trading psychology.

Being aware and knowing how to handle the psychological barriers that affect every trader decision will put the odds in your favor.

Other important aspects to keep an eye out for on your search for the best Forex training program should include: Developing habits for success (such as discipline patience, taking responsibility of every action, commitment, etc.,) understanding and taking your trading as a business, risk and trade management.

Trading the Forex market is no easy task. It requires a lot of hard work. . Just remember to take your time and find the program that will give you all the tools to ensure your success as a Forex trader.

The Secret Forex Code Review

The Secret Forex Code is the newest released automated forex trading system. Even though it is new it has been tested by many forex trader expert for so many years now before the system has been revealed to the public. And because it has been tested ans perfected we can make sure that this trading system really work and really spits huge profits. If you are just a beginner trader or just an ordinary trader who find it hard to make money then this fully automated forex trading system will be a very good choice. Let start with our review.

What is The Secret Forex Code? As I was telling you a while ago it is an automated forex trading system. And because it was automated you don't have to do a lot of works that usually involves on forex trading. You don't have to worry because you don't know how to trade because it will provide you all the information needed to start profiting from the largest market if the world. No hidden secrets about forex trading doesn't revealed here.

Who created the Secret Forex Code? This system was revealed by a forex trader named Alex Wilson. He is now earning huge income using this fully automated trading system. Like the many sales page that you will found online, this trading system was full of income proof, but this proof was not false claims, it was all true. This system break the belief that to good to be true is actually not true. This system cross it's boundary giving trader a large chance to make huge income. It has been tested, perfected and automated not just to help beginners but to help those trader who already trading the market but eventually failed to make enough profits.

What you will going to get with The Secret Forex Code? This automated forex trading system will provide you 2 100% mechanical trading system that you haven't seen before. A fully automated system or set and forget system that actually needs 10 minutes of your time each day. You just set the system for 10 minutes and then go to what you are plan doing and ensure that you can still make money even when you are not at home or in front of your computer. This system only knew one thing and that is to automate your trading and boost your trading profits. The system will give you a revolutionary trading system that precisely make killing winning trades and instantly create your place into the numbers of forex successful trader.

What I like about The Secret Forex Code is that it requires no thinking. You really don't have to decide for certain things because it actually show you the right things to do and all you have to do is set it up. No emotions involve because I personally think that it is very important that you shouldn't trade base on your emotions. I found the system really helpful and unique in a way that it was offering not just one but 2 fully automated forex trading system for the price of one. You can really save money here, you don't have to spend a lot of your hard earned money on expensive seminar. You can prevent yourself from too much spending without having started yet or profit yet. With the system you will not just save money but you will also save time monitoring your trade. And it works on any metatrader platform.

If you are asking if there is something I don't like about The Secret Forex Code, well I found it hard to believe that there is actually no point for not liking and wanting the system. Who do not want it? They are offering something that is a revolutionary, tested, proven and automated system and what's best is that you can try it risk free! If you are not satisfied you can get a refund.

Now, for our conclusion, If I'm going to rate this system among the many automated forex trading system that I already reviewed I will give perfect 10 being the highest. The Secret Forex Code is absolutely a breakthrough!

Forex Trading - The Foreign Currency Trading Systems Unblocked

Forex trading or currency trading is always done in currency pairs. For example, the exchange rate of EUR/USD on Aug 26th, 2003 was 1.0857. Forex trading is like driving. You will hurt yourself and the others if you start driving before you learn it properly. Forex trading online has become an investment vehicle of choice for many individual investors. Like any other speculative activity, it involves a certain level of risk (which you can control by setting your own Risk Management policy) but it also allows for huge profits.

Forex trading opportunities are a reality for more and more people everyday --- people just like you and me.

Forex trading skills and the trading system! If you want to work less than 20 hours a day at home, if you want to make millions by trading freely at home, if you want to have financial freedom by trading Forex; you better LEARN Forex trading before you start trading Forex. Forex trading online is becoming more and more popular and our aim is to keep you up to date with the very latest financial market trends and Forex forecasts. Live financial information and trading tips are all here to boost your currency trading experience. Forex trading is a serious business and it is vitally important that you are properly educated and informed before committing your hard-earned money to the markets. Along with the Forex Trading course and our online Forex Scalping course, we offer you personal one-on-one coaching through our Forex Coaching Service available worldwide.

Currency trading and investing in FOREX involve significant risk and may not be suitable for everyone. Past performance does not guarantee future results. Currency trading may not be suitable for all investors. Before deciding to trade foreign exchange, you should carefully consider your investment objectives, level of experience, and risk appetite. Currency Trading is the worlds largest market consisting of almost $2 trillion in daily volume and as investors learn more and become more interested, the market continues to rapidly grow. Not only is the forex market the largest market in the world, but it is also the most liquid, differentiating it from the other markets.

Currencies are traded against one another. Each pair of currencies thus constitutes an individual product and is traditionally noted XXX/YYY, where YYY is the ISO 4217 international three-letter code of the currency into which the price of one unit of XXX is expressed (called base currency ).

Forex Foreign Exchange Broker - How to Choose Your Perfect Investment Partner

If you have tried searching the Internet for a Forex foreign exchange broker you will be overwhelmed by the choice. The advent of the Internet has seen an explosion in the number of brokers who are offering their services. But if you are looking to find your ideal investment partner, a little due diligence and research will help you find the perfect broker.

A Forex broker is a person or company that will carry out Forex trades on your behalf. They are an essential part of your Forex strategy. They charge for this service, but not in the normal way. Whereas stockbrokers will usually charge you a commission, a Forex broker makes his money by the difference in the bid and ask price. Ideally you should be looking for a broker that charges a 2-3 pip spread. Anything over 5 pips is expensive and should be avoided.

The reputation of a company is a good indicator of what level of service you may expect from them. This information is sometimes quite difficult to obtain because many of the online Forex brokers are quite young companies. However you can visit the search engines and online discussion forums to see what other people's experience is with different brokers. The types of things to look out for are comments about how the company reacted to problems. Did they take ages to answer queries or were the customer support team able to deal with them quickly? Another common area of complaint is the ease of use of the platform. Are people finding that they can quickly execute their trades? This little bit of research shouldn't take you too long but it could save a lot of problems in the future.

One of the important practical things that will help you choose a broker is the trading platform that they provide. This is the software from which you make your trades. You should be looking for a platform that is user-friendly and easy to use. You may want to try out several on demo accounts so that you can get a feel for them. Most brokers will offer you an option to have a downloadable application or one that is web-based. The web-based option has the advantage that you can access it from any computer, whereas the downloaded version is often quicker.

Another important factor when selecting a Forex foreign exchange broker is whether they are regulated. You should check to see whether they are registered with Commodity Futures Trading Commission (CFTC). This should be the case for all US based Forex brokers. They should also be members of the National Futures Association (NFA).

Is Investing in the Foreign Exchange (Forex) Market For You

How would you like to make extra cash without much effort of either time nor money? Sure, who wouldn't enjoy an extra income stream to fund your lifestyle or to help cover the bills. If you're familiar with the foreign exchange market, than you know that both of these options can be true, but how can you know if investing in the foreign exchange market is for you?

Then just what exactly is required to trade on the forex market? The requirements are actually quite simple, as the only things you will need is a personal computer, a little capital to get started, and a trading plan to execute your trades.

Since the forex is a global market that operates 24 hours a day, and almost seven days a week, all of the trading is done via computer. This holds true for both individual traders as well as seasoned investment firms. The only difference is in the power of their software and the amount of money they are willing to invest.

The barriers of entry into the forex market are low, and you can start trading with as little as a dollar. Obviously, you will reap much better rewards if you invest $100,000 than if you were to invest only only $5. However, you can always start small and reinvest your winnings. This is a great way to quickly increase your forex trading leverage while using a small initial investment. Many brokers have used this technique of only reinvesting earnings to great success and very little risk.

Finally, the biggest skill, and most often the largest stumbling block to new investors is having the discipline to follow the market. Since the foreign exchange market can move quickly, many inexperienced investors can lose their confidence and begin making rash decisions. This is the worst thing to do, and many fortunes have been lost this way. Trading Forex is done by the numbers. It is best to have a proven system and to follow it exactly. There are many programs out there that will do exactly that, taking the guesswork out of investing. Either way, once you have a system in place, it is important to stick to it and not let emotions get in the way of your trading.

If you would like to venture into making some extra, and sometimes a lot of extra money, and think you have the discipline and a little capital to work with, than investing in the foreign exchange market is for you.

FOREX Trading Advice - The Good News Is That You Can Get Great Advice For FREE

All the forex advice you need to become a successful trader is available on the internet for free.

Here we will show you where to get the best forex advice for free and turn you into a profitable trader.

A common error

A common error made by many novice forex traders is to think that they can buy a system or an e-book from a guru for $100 or so and buy success.

Now, while there is some good forex advice sold on the net, the bulk of it is not worth the money.

Most of it is sold by salesmen (who have never traded) or failed brokers who cant trade and decide they may as well sell advice.

It is common sense that you cannot buy forex success for $100 or so, as if the forex advice worked then it would not be sold.

A quick way to decide if sold forex advice is worth your hard cash is to ask for a real time track record of real money made in the markets.

After that look for a money back guarantee.

If you don’t get both the above don’t buy it.

The reason you should do it on your own is that if you get your own forex advice and study it you will have confidence in it.

This means you will be more likely to follow it with discipline when you come to trade it.

It is far harder to follow someone else’s advice with discipline than your own, as you will always understand your own better.

The internet has all the information you need for free and here are some topics to look up and study

1. Technical analysis

Everything you need to know can be found on the net from advantages to the chart formations.

2. Technical indicators

You will know how to draw charts and what the formations mean from Point 1. Now you need some timing indicators.

Good ones to look up are: Bollinger bands, stochastics, moving averages, RSI and MACD. By all means look up others but the above are the ones we find most useful for entering a market

Go to a free chart service such as futuresource.com and look at them on some live charts.

3. Breakouts

Now you have looked at some charts and some indicators to help you identify and enter trends you need a methodology.

Perhaps the easiest methodology to use is a breakout method.

Look it up.

It’s easy to understand and easy to implement and it works.

4. Putting it altogether.

With the forex advice you have you can build a simple system to trade.

Base the system on breakouts and use chart support and resistance to spot profitable trading set ups.

You can then experiment with various technical indicators to help you enter breakouts.

Our own personal way of trading uses chart support and resistance to set up trades.

We then define entry with stohastics (a momentum indicator) and RSI which is an indication of the strength of the price and that’s it.

There is a lot of forex advice on the net that makes forex trading more difficult than it really is.

In fact, anyone with the free forex advice on the net can build test and implement a system based upon sound logic.

Keep in mind

The majority of traders fail because they lack discipline.

This comes from the fact that they don’t have confidence in their system and throw in the towel as soon as they have a few losses.

By taking some time to build your own system, you will have confidence in it and will be more able to follow it with discipline.

The fact is all the forex advice you need to build and trade a system for yourself is free.

If you put in the time and effort your study will be handsomely rewarded.