Learn online forex trading - What is support and resistance indicator?

Support and resistance lines are another set of powerful indicators you would like to learn in online forex trading. Before I explain it, I would like you to watch the diagram very carefully.

As you can see there are some key lines at which the price movement bounces. If from a particular imaginary line, the price bounces and starts moving downwards thats a resistance line. Thats because there are lot of sellers at that imaginary line that selling pressure increases and moves the currency in opposite direction.

The oppostite holds true for Support line. Here after hitting this line, the prices starts goiing up.

Guys and Gals do understand this concept carefully as this is very important in concept to learn in online forex trading.

Now, a pop question - What happens when this support/resistance line is broken?? Yes!! Thats true, if this line is broken, the price jumps in thst direction. So, if resistance line is broken, price will shoot up considerably and opposite for support line.

So, thats all in todey's session.

Meanwhile, look carefully at the EUR/USD , GBP/USD and USD/CHF charts on 1 hr timezone..

It seems their trend has started as anti USD. So, looks like USD is going to get weak in coming days. I'll be watching all these currency pairs' movement in tomorrow morning's UK session.

You can view the free charts at
http://www.dailyfx.com

Also, an important update - I am going to give limited number of copies of a valuable free gift to all the readers in next few days. So, keep visiting this blog so that you don't miss out that.

So, keep visisting this blog to learn online forex trading.

Learn Online Forex Trading - Do you trade on holidays like Memorial day for example?

At least I don't!!!

The reason is fairly simple. See the online forex trading world constitutes of big banks, institutes around the world. Its not like stock trading which is operated by a regulatory authority. So on a holiday like memorial day I am sure that the banks and financial institutions are closed. This means that there is not enough liquidity in the forex trading market. Specially today when the UK banks are closed because of Spring Holiday break, the liquidity is very low.

Oh, Did I tell you that UK and USA sessions are the ones where a lot of forex trading movements happen? So, today is not online forex trading day for me ..:-).

Very soon I'll post details about a new forex trading technical indicator. So keep visiting this blog to learn online forex trading

Learn Online Forex Trading - Details of my forex trade on 25-May-06 (Thursday)

This is a very interesting trade I placed on USD/CAD currency pair. First let me tell you few things about my trading style -

1. I trade on 30Min chart and 5 min. Chart.
2. 30 Min. chart is used to judge market direction. 5 min chart I use to place entry-exit points.
3. I use moving averages to judge market directions.
4. I also use MACD and RSI to confirm market direction and identify if there are any sign of reversals.
5. I never keep my trades open over weekend.

(If you don't understand the above jargon, thats OK. We'll cover these in next few days to learn online forex trading)


So lets go through my analysis of USD/CAD -
On the chart as you can see the moving averages are clearly bearish for USD/CAD.

1. The RSI was approaching 50
2. MACD is below Zero line
3. So, this looks like a bearish set up to me with CAD looking strong.
4. My entry is marked with a little red oval at 1.1089
5. My stop was 1.1120 (31 pips away from my entry order)
6. I placed my exit point at 1.1006 which looked like an important resistance.

So, after this I placed the trade and went to office. Here what happenned after that -

Market went to a range mode and kept oscillating between 1.1090 and 1.1050. I kept my trade open overnight and next morning which was Friday and I saw it continuing within the same range and was at a profit of 12 pips.

Since it was a Friday, it was a last trading day of the week and as per my trading strategy, I never keep my trades open and so I closed my trade with +12 pips.

So, what do you think about this trade? Do you have any questions? If so, please post in comments and I'll try to address in next blog post.

All forex traders, please give me yoir comments about this trade. Don't be afraid to pinpoint any mistakes I may have made. Afterall I too am learning online forex trading

Learn Online Forex Trading - Candlesticks Patterns

Candlesticks ?? What are they doing in online forex trading? No..I am not talking about the candles that you light at home.

Candlesticks is one of the most widely used indicators to check the market conditions. Make no mistake, It is used across all the markets for trading like Stocks, Options, Commodities, futures and Forex trading of course.

On left are typical candlesticks. Red is a bearish candlestick while green are bullish.

Now it can be an entire manual if I start describing the Candlesticks. So, here is what we'll do..I'll mention below a website link which you can visit and read about Candlesticks. That particular website is on Stocks trading and has a complete page about Candlesticks. What you'll read there can be applied to Forex market also.

http://www.altavest.com/candlesticks.html

So, go to this site and read about Candlesticks and read it again and again as it is one of the most powerful indicators and you really need to understand it if you want to learn online forex trading.

With in next few hours I'll mention about my online forex trade on USD/CAD that I did on
25-May-06. I'll also mention the analysis behind that trade.

I would like to know what do you think about that trade and post questions if you have are point out if I made any mistakes in that trade.

Keep visiting this blog to learn online forex trading.

Learn Online Forex Trading - This edition presents details about technical indicators.

Please remember that these concepts about technical indicators is very important and you better learn technical analysis concepts very carefully. So here we go -

The technical analysis is about reading the charts that demonstrate how the market has behaved in the past. What was the price fluctuation in a particular time span. Remember "fluctuation in a time span". This is one of the important concepts to learn in online forex trading. The time span can be 5 min., 1 hr, 1 day, 1 month or 1 year etc.

Below mentioned are few base points about the charts -
1. The current price of the forex pair is what it should be. Its not overpriced and its not underpriced.

2. The price movement in the past forms the basis of future movement.

3. The trend is always your friend. You will hear this again and again.

So always remember this when you are analysing charts to in online forex trading.

Now, the next question is how do you analyse it?

Remember the indicators we discussed for a minute yesterday? These indicators are classified in 2 groups -

1. Lagging Indicators - These indicators tell you about the past movements of the currency pair whether its undersold or whether its oversold. Example - MACD, RSI, Stochastic etc.

2. Leading Indicator - These are the indicators which tells you how the market is going to be in the future. Example - Fibonacci levels, which are one of the most powerful ones. Also, candlesticks, support and resistance lines are importment.

The ideal online forex trading strategy is to combine leading and lagging indicators which means to see how the price has behaved in the past and then see how will it behave in the future. If you would like to see any charts, please look at the below mentioned link -

Click here to see a live chart to learn online forex trading

Tomorrow, we shall look at the indicators in more detail.

So keep checking this blog to learn online forex trading for free..:-)

Learn online forex trading on this website - Free..:-)

There are lots of indicators in the market. And here is another amazing statistic. Every person who you speak to, everyone mentions of a new indicator they use. However as with everything, there are few famous ones -

1. Moving Averages
2. Relative Strength Index (RSI)
3. Stochastic Indicator
4. Support and resistance lines
5. Parabolic SAR
6. Moving Average Convergence Divergence (MACD)
And one of the most important ones -
7. Fibonacci Retracement

Overwhelmed? Don't know what they are?? Don't worry we'll go through each of them.
Also, one more point you have to remember - You don't have to use all of them.

So, lets wait for tomorrow's session to go through the indicators and their details.

One more thing. I guess you might be wondering where are details of my trades that I said I am going to share?

The answer is that I didn't place any trade as I found the market in a phase of retracement and just consolidating after a massive run..So, I wsas not sure if the trend is going to continue or is it going to retrace. So, I thought of being conservative and not trade.

So, remember what I said in my previous post - "Discipline - Without it ,I'll loose money and I'll be responsible for it"

So, I invoked this rule last week and didn't do any online forex trade. These kind of weeks do come sometime.

So be disciplined and then only trade.

So, keep visiting this blog. Add RSS feed to your browser and do come back again to
Learn Online Forex Trading.

During yesterday's session to learn forex trading, we went throgh 2 terms -

1. Fundamental Analysis
2. Technical analysis

Fundamental analysis in the world of online forex trading refers to government and world happennings like banking policy, government decisions, Non farm payrolls etc. For. e.g. if US government decides that they will import more oil from Canada, the value of USD will decrease and Canadian dollar will strengthen.

Technical analysis in the world of online forex trading is where your market charts come into picture. This is the place where you need to be aware of various indicators to understand which direct is market heading and which direction will it be gheading from here on. During this analysis, a person uses a combination of parameters. We shall go in details of these indicators in subsequent sessions to learn forex trading.

My experience has been that you need to combine technical analysis and fundamental analysis before placing a trade in world of online forex trading. Because it may happen that you did a technical analysis and are dead sure that the market will go in the direction you have predicted. As soon as you placed the trade, you found that market in the other direction because a just announced government policy made the currency pair move in different direction.

So, always combine fundamental and technical analysis before you place a trade.

Now let me tell you a resource for free charts -
Click here to access free charts for online forex trading

Also, on that site you can find schedule when key announcements will be made.

So thats today's session to learn forex trading in the world of online forex trading

Before I go into details about my online forex trading, I need to tell you few more things about placing orders in the online forex tradeing -

1. The trades need to be placed with careful analysis. As much as can you gain with a carefully thought trades, there is equal chance that you may loose money with a rash trade without any analysis.

2. The analysis is recommended to be done in 2 forms - Fundamental and Technical.
We'll go into the details of these 2 types of online forex trades analysis tomorrow.

3. You need to have a lot of discipline when you trade. This is one of the keys. So infact I'll ask all the traders to do one thing - Every morning after breakfast say this - "Discipline - Without it ,I'll loose money and I'll be responsible for it" and say it out loud.

So now, about my trade for the day -

All the currencies on which I do online forex trade (For details, refer yesterday's blog message), they were retracing after long rally. Since retracement is temporary phase and pne can never be sure when will it end, I invoked rule number 3 - Discipline..and didn't place trade on any of the currencies..

See its very simple, I am not gambling. I do analysis of the market. If the market is good enough to make online forex trade, I'll place it. Else, I'll check the market again tomorrow.

See guys and gals..It has been just few days and you would have already learned quite a few things which took me weeks to months to learn. One of the biggest things I learned was - discipline.

So keep visiting this blog on a daily basis to learn forex trade..Yes, learn forex trade and then only start online forex trading.

I would suggest you to add this blog as RSS feed to your browser. By this whenever I'll post a new message, it will get displayed on the webpage of your choice like google/msn/yahoo etc. You can add the RSS by selecting an rss option from the sidemenu. Also, keep posting your comments to this blog.

Happy online forex trading. Join again tomorrow to learn forex trading.

Online Forex trading is done using pair of currencies. You make money when the value of one currency changes in respect to the other. There are lots of currencies which are traded -
EUR IEuro), USD (Dollar), GBP (British Pound), CHF (Swiss Franc), CAD (Canadian Dollar), JPY (Japenese Yen), NZD (NewZealand Dollar), AUD (Aussie Dollar) etc.

These are traded in pairs. The prominant pairs are the ones that have USD as one of the currencies.

The major currencies are -
EUR/USD, GBP/USD, USD/JPY, USD/CHF

The other prominent forex trading pairs are -
USD/CAD, AUD/USD, NZD/USD

And these 7 are the only online forex trading currencies that I trade in. There are other also like EUR/GBP, NZD/AUD etc., which I don't trade as they have very less liquidity.

Now the next big question is - How do you identify which currency to buy and which to sell in a particular currency pair?

This and more tomorrow..:-)..
Very shortly I'll post about my trade for the day.

Stay tuned for online forex trading and to learn forex trading.

The online forex trading market is open 24 hrs a day starting at 2 PM EST on Sunday till 5 PM on Friday. How is this? This is because Forex trading market is inter-country market and is traded across multiple countries. However the most prominent are - UK, USA, Japan, Australia and France.

So as you see, in the morning the US market is trading it. As soon as the USA session is about to get over, the asian market takes over and in middle of the Asian market, British market gets up and running.

So here comes the biggest question - What is the best time to do online forex trading?

The answer is - When the liquidity is very high. Which happens when number of people doing online forex trading are very high. Which in forex trading happens when there is overlap of multiple markets.

So ladies and gentleman - The best time to do online forex is between -
a. 2 AM to 6 AM is the best time when UK and Asian sessions are overlapping and the liquidity is highest.
b. 8 AM to 12 AM is next best time when USA and UK sessions are overlapping.

In terms of days generally Monday to Thursdays are good. Fridays and Sundays, not much action since Froex trading market is either about to close down or has just started.


Now let me tell you one of My Trading Rules -
1. I trade anywhere between 2 AM to 12 PM. Never outside that.
2. I never ever trade on Sundays even if the trends look the strongest since the market direction is mostly unpredictable at this time.

Now next question is which currencies to trade and why? Also, how is an online Forex trade made?

All this and more tomorrow..:-)

This concludes another session to learn online forex trading and forex trading systems.

Welcome to another day in world of Online Forex Trading - Your plateform to learn forex trading and to trade withe me

So what is Online Forex trading - Its just like trading stocks, only you do this trading against Forex (Foreign Exchange) or currency. These are traded in pairs such as GBP/USD, EUR/USD etc. You buy one anticipating that its value is going to rise e.g. the other and when it does, you sell it back to close trade. Example -

You think Euro is going to get stronger against Dollar and you buy 1000 Euro from your broker with rate of
1 Euro = 1.30 $.
Your observation goes right and at end of day value of Euro is
1 Euro = 1.31$
So you close the trade by giving 1000 Euro back to broker and taking back your dollars.

To understand more about forex trading, you can also visit -
FXCM - What is Forex trading

Now please remember that there is 200:1 in Forex market, so if your trade goes right, forex trading can give you a very handsome return. Also, the forex market is open 24 hrs a day and 6 days a week, so the liquidity too is very high. But obviously there are some better hours to do the forex trading. On this we'll go in detail tomorrow.

Also, tomorrow I'll tell you few things about my trading style and also about the trade if any I'll place tomorrow...

So stay tuned to learn Forex Trading.