Wednesday, June 28, 2006
Learn online forex trading - Shhhhhhhhh the market is quiet..Why??
Learn Online Forex Trading - The market is unusually quiet....
Yes, the forex trading market is unusually quiet for the past 2 days.. Why??
Lets go through the dynamics of the forex trading market..
Phase 1 -
The forex trading market's direction is driven by the fundamental news primarily. So, lets say that US federal bank says that its going to hike interest rate..This means that USD will get stronger as more interest will be earned on USD..So, people will start converting their currencies to USD.
Phase 2
When this happens, we traders will start using technical analysis to find opportune time for entry in online forex trading and also finding a suitable exit point.
So, basically this ensures that trades are in place and market is in motion and starts trending..
Phase 3
Now, when the impact of the fundamental news is about to subside, the market starts going in range as all the online forex trading is happenning through technical analysis.
Phase 4
Later on the markets range starts narrowing and after some time the technical analysis will also not work..
However, in between these phases, a fundamental news will come and the market will start trending again..And then this cycle continues.
However, what happens when online forex trading market reaches phase 4 and no fundamental news is coming??
Thats what is happenning right now..The market is much more than quiet..
So, when will market be in motion again?? Yes, you guessed it right..When another fundamental announcement will come..Before that no one is going to make an online forex trade and take a risk.
But, check when the markets come into motion again..there are eager weager traders all across the world who are just waiting for market to come into motion again. Once it happens, it will start trending strongly again.
So here is my suggestion..
DON'T DO ANY ONLINE FOREX TRADING TILL 9:30 AM TOMORROW.
Why?? Because from 8:30 AM to 9:00 AM, some important fundamental announcements are going to come including FOMC rate decision..
But, do start analysing the trend later on and identify entry and exit points for your next online forex trading.
Thats all in today's message..Do visit tomorrow again to learn more in online forex trading.
Yes, the forex trading market is unusually quiet for the past 2 days.. Why??
Lets go through the dynamics of the forex trading market..
Phase 1 -
The forex trading market's direction is driven by the fundamental news primarily. So, lets say that US federal bank says that its going to hike interest rate..This means that USD will get stronger as more interest will be earned on USD..So, people will start converting their currencies to USD.
Phase 2
When this happens, we traders will start using technical analysis to find opportune time for entry in online forex trading and also finding a suitable exit point.
So, basically this ensures that trades are in place and market is in motion and starts trending..
Phase 3
Now, when the impact of the fundamental news is about to subside, the market starts going in range as all the online forex trading is happenning through technical analysis.
Phase 4
Later on the markets range starts narrowing and after some time the technical analysis will also not work..
However, in between these phases, a fundamental news will come and the market will start trending again..And then this cycle continues.
However, what happens when online forex trading market reaches phase 4 and no fundamental news is coming??
Thats what is happenning right now..The market is much more than quiet..
So, when will market be in motion again?? Yes, you guessed it right..When another fundamental announcement will come..Before that no one is going to make an online forex trade and take a risk.
But, check when the markets come into motion again..there are eager weager traders all across the world who are just waiting for market to come into motion again. Once it happens, it will start trending strongly again.
So here is my suggestion..
DON'T DO ANY ONLINE FOREX TRADING TILL 9:30 AM TOMORROW.
Why?? Because from 8:30 AM to 9:00 AM, some important fundamental announcements are going to come including FOMC rate decision..
But, do start analysing the trend later on and identify entry and exit points for your next online forex trading.
Thats all in today's message..Do visit tomorrow again to learn more in online forex trading.
Sunday, June 25, 2006
Learn online forex trading - The market stopped me
Learn online forex trading - The market stopped me..what did I do??
Remember about my online forex trade on USD/CHF? If not, please read my last two articles.
I was looking good towards my target of 1.2270..I was at a point in 63 pips profit.
Then the market turned and turned big..To be honest I didn't see that coming..It could have wiped my entire profits. But I guess I was bit smart, so I didn't loose all my profit.
How?? I generally move my stop loss to secure part of my profits..So, here is what my rule is -
1. In online forex trading, I keep my stoploss between 20 to 40 pips from entry point. The exact number is dependent on the market conditions such where is the immediate support/resistance etc.
2. When my trade is in profit and the profit is equal to my stoploss amount, I move my stop loss to entry point. So now if market reverses, I atleast won't make any loss.
3. Then after every 35 pip further profit, I move my stoploss by another 35 pips in the direction of trade.
4. Then ofcourse if I see that there are signals that market may reverse, I close my trade and not wait for market to stop me out.
So, in this trade, when I was in 63 pips profit, my stop secured part of my profits. So, although I got stopped out, I mad 30 pips profit in this forex trading.
Also, let me share with you, after this I placed another trade on USD/JPY and closed that trade at 105 pip profit..:-)..How?? I am testing a new system, if the system turns out to be reliable, I'll share the details with you..ofcourse for free..:-)
Watch out for my next article, it will contain details about another profitable indicator that can be used in online forex trading.
So, keep visiting to learn online forex trading
Remember about my online forex trade on USD/CHF? If not, please read my last two articles.
I was looking good towards my target of 1.2270..I was at a point in 63 pips profit.
Then the market turned and turned big..To be honest I didn't see that coming..It could have wiped my entire profits. But I guess I was bit smart, so I didn't loose all my profit.
How?? I generally move my stop loss to secure part of my profits..So, here is what my rule is -
1. In online forex trading, I keep my stoploss between 20 to 40 pips from entry point. The exact number is dependent on the market conditions such where is the immediate support/resistance etc.
2. When my trade is in profit and the profit is equal to my stoploss amount, I move my stop loss to entry point. So now if market reverses, I atleast won't make any loss.
3. Then after every 35 pip further profit, I move my stoploss by another 35 pips in the direction of trade.
4. Then ofcourse if I see that there are signals that market may reverse, I close my trade and not wait for market to stop me out.
So, in this trade, when I was in 63 pips profit, my stop secured part of my profits. So, although I got stopped out, I mad 30 pips profit in this forex trading.
Also, let me share with you, after this I placed another trade on USD/JPY and closed that trade at 105 pip profit..:-)..How?? I am testing a new system, if the system turns out to be reliable, I'll share the details with you..ofcourse for free..:-)
Watch out for my next article, it will contain details about another profitable indicator that can be used in online forex trading.
So, keep visiting to learn online forex trading
Wednesday, June 21, 2006
Learn online forex trading - What happenned to my USD/CHF trade?
Learn Online Forex Trading - What happenned to my trade on USD/CHF?
Yes, I'll come on to the details of the trade. But before that lets review the technical indicators I have discussed so far -
1. Support and resistance levels - In Online forex trading support and resistance areas tell key areas from where the market direction generally reverses. The more number of times the market reverses from that point, the more stronger that area is. So, definitly if the resistance and support area is broken, the market continues going in that direction.
2. MACD - Moving Average Convergance & Divergance in online forex trading tells the momentem of the moving averages with respective to each other. When lets say that market is making higher highs, but MACD is not, that suggests that the market is losing its steam and may move in other direction.
3. Candlesticks - These are the units that indicate what markets may do next. As I mentioned in earlier post, there are books and books written on Candlesticks and its patterns.
4. Double bottom and double top - A variation ofsupport and resistance level. Generally when a market tests a support/resistance area twice, if it cannot break that area, it moves in the opposite direction. So generally when a double top/bottom are formed, its a good time to enter a trade.
Also, I have posted a lots of other informative articles on online forex trading. Don't foreget to read those if you have not already.
So, I used the above mentioned indicators to do online forex trading. Like I placed on USD/CHF yesterday.
Now lets go through the details of the forex trade I placed -
Yesterday -
Enter the trade at 1.2390 and
Place stop at 1.2420
Place the target at 1.2270
At this point the currency pair is at 1.2334 in a profit of 56 pips.
I have set the target of 1.2270. So, the currency has to move another 60 pips in the direction of my trade before I'll close it.
So, more updates on the trade tomorrow.
So, keep visiting this blog to learn online forex trading.
Yes, I'll come on to the details of the trade. But before that lets review the technical indicators I have discussed so far -
1. Support and resistance levels - In Online forex trading support and resistance areas tell key areas from where the market direction generally reverses. The more number of times the market reverses from that point, the more stronger that area is. So, definitly if the resistance and support area is broken, the market continues going in that direction.
2. MACD - Moving Average Convergance & Divergance in online forex trading tells the momentem of the moving averages with respective to each other. When lets say that market is making higher highs, but MACD is not, that suggests that the market is losing its steam and may move in other direction.
3. Candlesticks - These are the units that indicate what markets may do next. As I mentioned in earlier post, there are books and books written on Candlesticks and its patterns.
4. Double bottom and double top - A variation ofsupport and resistance level. Generally when a market tests a support/resistance area twice, if it cannot break that area, it moves in the opposite direction. So generally when a double top/bottom are formed, its a good time to enter a trade.
Also, I have posted a lots of other informative articles on online forex trading. Don't foreget to read those if you have not already.
So, I used the above mentioned indicators to do online forex trading. Like I placed on USD/CHF yesterday.
Now lets go through the details of the forex trade I placed -
Yesterday -
Enter the trade at 1.2390 and
Place stop at 1.2420
Place the target at 1.2270
At this point the currency pair is at 1.2334 in a profit of 56 pips.
I have set the target of 1.2270. So, the currency has to move another 60 pips in the direction of my trade before I'll close it.
So, more updates on the trade tomorrow.
So, keep visiting this blog to learn online forex trading.
Tuesday, June 20, 2006
Learn Online Forex Trading - Why do I feel good?
Learn online Forex Trading - Why do "I feel good"?
Because another forex trade of mine went right..:-)..If you read the end of my last post, I guessed that USD/CHF will hit 1.2410 and make a double top..
Well it didn't exactly 1.2410. It went till 1.2430 and then is now bouncing from 38.2% fib level on the daily charts. So, in the online forex trading this is a very exciting time. If the 38.2 fib holds true, I can see the pair hit atleast 1.2000. So its like double bottom.
Now the next thing is to identify a good entry point on the hourly chart or the 5 min chart depending on your forex trading type.
If you look at the hourly chart at the type of this message, the indicators are pointing to go short.. -
1. The MACD indicator is showing divergance as in the currency pair is making a double top, but MACD is not.
2. Currency made a double top.
3. RSI is below 50.
So, for me the ideal online forex trade will be to -
Enter the trade at 1.2390 and
Place stop at 1.2420
Place the target at 1.2270
So, with 30 pips to 120 is a great risk reward ratio of 1:4
So, In fact I have entered the online forex trade at 1.2390.
I'll post my results tomorrow..:-)
So, keep visiting to learn more about online forex trading.
Sunday, June 18, 2006
Learn Online Forex Trading - Whats the broker Commission?
Learn Online Forex Trading - What is the broker commission in forex trading?
Welcome to another week in the world of forex trading..As you know the forex market opens on Sunday at 2 PM EST with opening of Aussie and Kiwi markets.
Now many of you know that their are broker commissions associated with the trades you make in stocks or futures or commodity trading. The commissions vary between $7 to $20 per trade depending on the broker you choose...
However it is said that in online forex trading there are no broker commissions..Is it true???
Not entirely..I agree there are no DIRECT COMMISSIONS associated. So, how do they brokers earn?? They earn on the basis of SPREADS between bid and ask price of a currency pair.
How?? let me give you an example - Each currency pair has a bid and ask price. Like lets say that EUR/USD has a
Bid price of - 1.3000
Ask Price of - 1.3003
So, if you have to buy the EUR you will have to $1.3003 for each EURO. But, if you are selling EUR, you will get 1.3000..So, as you see there is a gap of 3 PIPS between buy and sell price.
(What is PIPS in forex trading?? Please read my previos article to understand it)
So, this gap, more called as SPREAD is the broker commission. So, if you have a mini account you are paying $3 per trade to your broker for forex trading EUR/USD and if you have a major account, you are paying $30.
The spread varies from currency pair to currency pair, however all the currency pais that have USD as one currency have the spread ranging from 3 PIPs to 5 PIPs
So, when you are opening online forex trading account don't forget to check the broker spread.
Now, how is the market looking right now??
I just now analysed the USD/CHF currency pair on a 30 min chart. I feel it is going to go upatleast till 1.2350 to make a double top as it has bounced from 200 EMA. There is a strong resistance at 1.2350 levels.
However if it breaks the level, the next stop could be 1.2410 which is also the 38.2 fib level on daily chart. Also on 30 min chart the MACDs are pointing up..So, its a buy call from my side...BUT..
But I am not going to trade since I don't do online forex trading on Sundays because of low liquidity in market. This is my trading rule..
So, thats all in today's article..Come back again tomorrow to learn more in online forex trading.
Welcome to another week in the world of forex trading..As you know the forex market opens on Sunday at 2 PM EST with opening of Aussie and Kiwi markets.
Now many of you know that their are broker commissions associated with the trades you make in stocks or futures or commodity trading. The commissions vary between $7 to $20 per trade depending on the broker you choose...
However it is said that in online forex trading there are no broker commissions..Is it true???
Not entirely..I agree there are no DIRECT COMMISSIONS associated. So, how do they brokers earn?? They earn on the basis of SPREADS between bid and ask price of a currency pair.
How?? let me give you an example - Each currency pair has a bid and ask price. Like lets say that EUR/USD has a
Bid price of - 1.3000
Ask Price of - 1.3003
So, if you have to buy the EUR you will have to $1.3003 for each EURO. But, if you are selling EUR, you will get 1.3000..So, as you see there is a gap of 3 PIPS between buy and sell price.
(What is PIPS in forex trading?? Please read my previos article to understand it)
So, this gap, more called as SPREAD is the broker commission. So, if you have a mini account you are paying $3 per trade to your broker for forex trading EUR/USD and if you have a major account, you are paying $30.
The spread varies from currency pair to currency pair, however all the currency pais that have USD as one currency have the spread ranging from 3 PIPs to 5 PIPs
So, when you are opening online forex trading account don't forget to check the broker spread.
Now, how is the market looking right now??
I just now analysed the USD/CHF currency pair on a 30 min chart. I feel it is going to go upatleast till 1.2350 to make a double top as it has bounced from 200 EMA. There is a strong resistance at 1.2350 levels.
However if it breaks the level, the next stop could be 1.2410 which is also the 38.2 fib level on daily chart. Also on 30 min chart the MACDs are pointing up..So, its a buy call from my side...BUT..
But I am not going to trade since I don't do online forex trading on Sundays because of low liquidity in market. This is my trading rule..
So, thats all in today's article..Come back again tomorrow to learn more in online forex trading.
Thursday, June 15, 2006
Learn online forex trading - What are the basics?
Learn online forex trading - What are the basics of forex trading?
I guess I started sharing about forex trading at a more high level. People are asking me questions which are making me realize that I need to cover some more basics about forex trading.
So, lets start with it. I'll share the information that you'll need in day to day forex trading.
1. Learn how is online forex trading done -
Forex trading is done in currency pairs. its something like you buy one currency by selling the other. The trade consists of 2 parts -
I guess I started sharing about forex trading at a more high level. People are asking me questions which are making me realize that I need to cover some more basics about forex trading.
So, lets start with it. I'll share the information that you'll need in day to day forex trading.
1. Learn how is online forex trading done -
Forex trading is done in currency pairs. its something like you buy one currency by selling the other. The trade consists of 2 parts -
- Opening a trade - So, in a particular trade, you will sell USD to buy EUR. This will open your trade.
- Closing the trade - In our example, you'll sell EUR back to get your USDs
So, for e.g. the market rate is that 1EUR = 1.3000 USD. So, in our trade, you'll give 1.3000 USD to get 1 EUR expecting that the value of EUR will increase. So, lets say later in the day value of EUR becomes 1EUR = 1.3100 USD, then you'll close the forex trade by returning 1 EUR to get 1.31 USD.
So, this is the basic way to make money in online forex trading. You sell 1 corrency to buy other and then return the bought currency back once its value has increased.
2. Learn What is PIP -
A PIP is the smallest movement in the value of a currency in forex trading. So, for e.g -
When 1 EUR = 1.3000 USD
changes to 1 EUR = 1.3001 USD
Then it means that value of EUR has increased by 1 PIP.
This change in the value is how one makes money in Online Forex Trading.
3. Learn what are different types of accounts in online forex trading -
- DEMO Account - Yes..One of the most important accounts in Forex trading..Use this account to learn and master the art of online forex trading. The brokers create this account for free for you with virtual money. So, use this account to place trades, try different trading strategies without any fear of losing real money.
- Mini Account - An account that can be started with as little as $300 in your online forex account. With this account, you'll earn about $1 for every pip movement in your trade direction. On the other hand, you can loose $1 for every single pip movement against your trade.
- Major account - Starts with about $2500 in your online forex trading account. Here you earn about $10 for every single pip movement in your trade direction and loose $10 if pip movement is not in your trade direction.
Note: read this and learn this - Start with Demo online forex trading account and practice using it. If you cannot make money in your demo account, you cannot make money in your real account. After, you have CONSISTENTLY made money in demo account, then start mini account and after earning there consistently, start major account.
4. Learn what are the major currency pairs in online forex trading -
The currency pairs involve these currencies -
- EUR (Euro)
- USD (US Dollar)
- GBP (Great British Pound)
- CHF (Swiss Franc)
- JPY (Japanese Yen)
- AUD (Australian Dollar)
- NZD ( Newzealand Dollar)
So, currency pairs are EUR/USD, GBP/USD, EUR/NZD etc.
However I trade only those currency pairs that involve USD.
5. Learn how to know about which currency to buy and which to sell -
Generally the analysis is done in 2 ways - Fundamental and Technical. You can learn about these types by visiting this blog. I have already posted lots of information about these trading styles in my previous posts. Please go through and definitely go through those.
http://the-forex-trading.blogspot.com/
So, keep visiting this blog to learn more about online forex trading.
Wednesday, June 14, 2006
Learn Online Forex Trading - What is Double Top??
Learn Online Forex Trading - What is a double top and a double bottom? How much reliable is it?
Before I start going through details about Double top, I need to share with you that I am very excited today..Why??
Yesterday when I was doing analysis of the charts of EUR/USD and GBP/USD for forex trading, my analysis said that market will bounce tomorrow because it has hit 38.2 fibonacci levels..And guess what it sure bounced..:-)
Now, the market did not bounce just because of technical reasons. There were fundamental reasons also..like Federal Bank's chief's speech, EUR inflation data etc..
Now, did I make any money?? No, since I was trying a different methodology for forex trading
and that technique didn't work..And of course I was trying this technique for forex trading on a demo account.
Now, lets come back to concept of Double Top and Double Bottom -
Look at the chart I have included. It highlights a classic case of double top.
Double top in online forex trading is a situation when in an uptrend, the market makes a high, then retraces and then touches the previous high again, but doesn't breaks it. It then is a signal that the market COULD be reversing.
The opposite is true for down trend. In that case it is called as double bottom.
In the chart, please see that EUR/USD made a hih, then retraced a bit and then hit the high again. and since it could not penetrate it, it retraced. So double top/bottom is an important concept in forex trading.
So, friends thats all in todays concept to learn online forex trading. Visit tomorrow again to learn something more.
Tuesday, June 13, 2006
Learn Online Forex Trading - Where is the market??
Learn Online Forex trading - Which direction will market go tomorrow?
Look at daily charts for EUR/USD and GBP/USD. They are all at 38.6 Fibonacci levels..Wow.
What can happen due to this? My 1st guess is that they will bounce tomorrow, as at all the fibonacci levels the currency pair show some support during downtrend.
However I'll do forex trading only when I get indicator confirmation. I do forex trading using 30 min. and 5 min. chart. So, I'll see of market has bounced and RSI and MACD also confirm the same.
On 30 Min. chart I am already seeing the MACD divergence. The currency pairs are making new lows, but the MACD pair has not made the same.
So, watch out how EUR/USD and GBP/USD will work tomorrow.
Thats all in today's session to learn forex trading. Visit tomorrow again to learn more.
Sunday, June 11, 2006
Learn Forex Trading - Was I wrong last week?
Learn online forex trading - Was I wrong last week?
I was anticipating EUR/USD breakout last week..What happenned? Was I wrong? Not really..as I didn't knew that the fundamental news of killing of Al-qaeda terrorist will hit the market making USD stronger and stronger.
But the important question to ask is - Did I lose any money? No, I didn't..Why?? because I didn't do any forex trading...Why?
Because I was waiting for a confirming signal to enter long on EURO/USD..which didn't come and so I didn't do any forex trading..So, what saved me my money?? Discipline!!!
So, guys n gals, discipline is a big asset in forex trading..I have emphasized it again and again during our journey to learn forex trading. Remember - Money saved is as good as money earned!!
By the way, I am sorry for the delay in posting this latest message, as I was busy with few things.
So, this post was to highlight with a real example of the impact of fundamental announcements is forex trading. Of course, the example we just saw could not have been predicted, however the ones we know like Non-firm Payrolls (NFP) etc should definitely be considered before doing forex trading..Please remember this tip.
In next post we'll learn and see practical application of Relative Strength Index (RSI) technical indicator.
So, keep visiting and add RSS feed of this site to your page to learn online forex trading.
I was anticipating EUR/USD breakout last week..What happenned? Was I wrong? Not really..as I didn't knew that the fundamental news of killing of Al-qaeda terrorist will hit the market making USD stronger and stronger.
But the important question to ask is - Did I lose any money? No, I didn't..Why?? because I didn't do any forex trading...Why?
Because I was waiting for a confirming signal to enter long on EURO/USD..which didn't come and so I didn't do any forex trading..So, what saved me my money?? Discipline!!!
So, guys n gals, discipline is a big asset in forex trading..I have emphasized it again and again during our journey to learn forex trading. Remember - Money saved is as good as money earned!!
By the way, I am sorry for the delay in posting this latest message, as I was busy with few things.
So, this post was to highlight with a real example of the impact of fundamental announcements is forex trading. Of course, the example we just saw could not have been predicted, however the ones we know like Non-firm Payrolls (NFP) etc should definitely be considered before doing forex trading..Please remember this tip.
In next post we'll learn and see practical application of Relative Strength Index (RSI) technical indicator.
So, keep visiting and add RSS feed of this site to your page to learn online forex trading.
Wednesday, June 07, 2006
Learn Forex Trading - Technical Analysis using MACD Indicator
Learn Forex Trading - MACD indicator
Moving Average Convergance and Divergance (MACD) is one of the widely used indicators in forex trading community. The indicator is calculated on the basis of moving averages. We'll definitely go through Moving Averages tomorrow. Currently please just remember that MACD is based on moving averages.
MACD is calculated by subtracting longer moving average from shorter moving average. The difference is plotted as a line and a second line is also plotted on the basis of another moving average. So the crossing of these 2 lines triggers the buying ad selling signal.
Most common values used for MACD is 12/26/9 . So, here the difference between 12and 26 moving averages is used to plot a line and the second line is a 9 day moving average. The crossing over of these 2 lines is used to identify buying and selling signal.
Now please remember MACD is a lagging indicator which means it generates signal only after an event has happenned.
So, how can MACD indicator be used for forex trading if it signals only after the event has happenned? I use it in forex trading to identify if the trend is changing.
It generates the signal for -
1. Positive Divergence
2. Negative Divergence
What does this mean in forex trading? Please refer to the chart above -
Here a Positive divergence is happenning as you can see that overall chart is making lower lows but MACD is making higher lows. This signifies that the down trend is losing its steam and can change directions anytime.
The opposite is true for negative divergence.
How do I use this indicator for Forex trading??
I use MACD to see if there is any divergence if positive or negative to see if there is any change in trend happenning. So lets say if I decide to go long in forex trading and there is a negative divergence, I do not place trade. And similarly for short forex trading.
So thats all to learn in forex trading today..Tomorrow we'll cover Moving Averages.
So, keep visiting and add RSS feed to your default page from this site to learn forex trading.
Sunday, June 04, 2006
Learn Online Forex Trading - What is the market saying??
Learn Online Forex Trading - Welcome to the new week. What is the market saying this week?
Last week on Friday the the USD went weak..Significantly weak. Why?? Because the "Non Firm Payrolls" results were not strong.
Remember guys and gals, I told you that in forex trading market, the market moves because of 2 broad reasons ?? One is Technical and the other is fundamental. Of the two the most widely used by we all traders is technical. However big banks, funds owners they put more emphasis of Fundamentals because Fundamental Announcement overrides all the technical announcement.
Please read again the last sentence..If you did technical analysis and are dead confident that market will move the way you predicted, you would be surprised when you'll find out that market went exact opposite to what you predicted..Why?? Because just then a fundamental announcement broke out that drove the market with it.
Non Firm Payroll declaration is one of the strongest fundamental announcements and happens on the last Friday of every month. There are many others also. During these announcements, the market moves 100-150 pips in just a matter of seconds or minutes..
So here is my advice for trading when fundamental announcement is about to break -
1. Never Trade the fundamental announcements..It can wipe out your account.
2. Never trade from 15 min prior to 30 min. after fundamental announcements have been made. This is an important tip for frex trading..Better learn it to save your riches.
3. Whenever you are going to make a trade, check the calender of these announcements to check when is next important fundamental announcement. One recommended site is -
http://www.dailyfx.com
Learn this concept carefully for doing forex trading.
Now, if you look at the charts on the same site, you'll see that EUR/USD is at or near all time high for the span of last few months..
So it breaks the high, the EUR/USD can be expected to cross 1.3200 I guess..Same with GBP/USD and USD/CHF..I guess $$$ is going to get week against all currencies..
BUT, I'll place my trades only when my theory is confirmed!! Place a trade only when you get confirmation from ypur indicators. Learn this concept as well.
So, this week is very important for all the traders as I guess a breakout may happen.
Tomorrow I'll post details about a very important and widely used indicator which is very reliable.
So keep visiting this site to learn forex trading online. Infact I'll would recommend to add RSS feeds of this site to your default page.
See you tomorrow for another session on forex trading.
Last week on Friday the the USD went weak..Significantly weak. Why?? Because the "Non Firm Payrolls" results were not strong.
Remember guys and gals, I told you that in forex trading market, the market moves because of 2 broad reasons ?? One is Technical and the other is fundamental. Of the two the most widely used by we all traders is technical. However big banks, funds owners they put more emphasis of Fundamentals because Fundamental Announcement overrides all the technical announcement.
Please read again the last sentence..If you did technical analysis and are dead confident that market will move the way you predicted, you would be surprised when you'll find out that market went exact opposite to what you predicted..Why?? Because just then a fundamental announcement broke out that drove the market with it.
Non Firm Payroll declaration is one of the strongest fundamental announcements and happens on the last Friday of every month. There are many others also. During these announcements, the market moves 100-150 pips in just a matter of seconds or minutes..
So here is my advice for trading when fundamental announcement is about to break -
1. Never Trade the fundamental announcements..It can wipe out your account.
2. Never trade from 15 min prior to 30 min. after fundamental announcements have been made. This is an important tip for frex trading..Better learn it to save your riches.
3. Whenever you are going to make a trade, check the calender of these announcements to check when is next important fundamental announcement. One recommended site is -
http://www.dailyfx.com
Learn this concept carefully for doing forex trading.
Now, if you look at the charts on the same site, you'll see that EUR/USD is at or near all time high for the span of last few months..
So it breaks the high, the EUR/USD can be expected to cross 1.3200 I guess..Same with GBP/USD and USD/CHF..I guess $$$ is going to get week against all currencies..
BUT, I'll place my trades only when my theory is confirmed!! Place a trade only when you get confirmation from ypur indicators. Learn this concept as well.
So, this week is very important for all the traders as I guess a breakout may happen.
Tomorrow I'll post details about a very important and widely used indicator which is very reliable.
So keep visiting this site to learn forex trading online. Infact I'll would recommend to add RSS feeds of this site to your default page.
See you tomorrow for another session on forex trading.
Thursday, June 01, 2006
Learn online forex trading - A Perfect Mistake
Learn online forex trading - Read to learn something more about forex trading from my perfect mistake -
Remember what did I say in one of my previous posts - http://the-forex-trading.blogspot.com/2006/05/learn-online-forex-trading-popular.html
"Discipline - Without it ,I'll loose money and I'll be responsible for it"
Here is an example of a trade in which I was making good profit..But, I ignored my rules.
I got greedy and ended up loosing money..How?? Lets analyse the trade together.
This trade was made on 29 or 30-May-06. Here it goes -
1. My general rule is to trade between 2 AM to 12 PM. I placed the trade at 6 PM.
So rule vioulation number 1. However I didn't get burned because of this. I was in negative
for sometime because of this. .
2. Look at the chart for EUR/USD especially in the areas marked in RED & Blue CIRCLE.
3. Look at the corresponding MACD indicator readings right under the candlestick chart.
4. Also look at the corresponding RSI indicator.
5. So, when the candlestick was in blue circle area, I placed the BUY trade on EUR/USD as RSI was near median line and MACD as also in buy area.
6. I also placed 37 pips stop loss.
7. And when the price was in red area I was at 35 pips profit
8. But what did I see? I saw that the MACD indicator was showing divergance.
Ideally what should I do at this time?? I should close the trade.
9. However, what did I do? I though let me run the trade for few pips more. I was aware that the currency will go in opposite direction soon. Still I let the trade run.
10. So, what happenned? the currency reversed as I guessed and I hit the stop loss and instead of gaining 35 pips, I lost 37 pips.
So, a trade which could had been profitable..But I lost it..Why? Because I wasn't disciplined for this trade.
So friends what did we learn with this trade??
Please post your comments on this trade..!!
Checkout tomorrow again to learn online forex trading
