Trading trend with forex

Forex trading involves the buying and selling of currencies. The manner in which this is done is by trading currency pairs. The major currency pairs are GBP/USD, EUR/USD, USD/CHF, USD/JPY, AUD/USD and USD/CAD.

There are three main methods of trading forex as follows:

1. Day trading

2. Swing trading

3. Long term trading

It has been identified that currencies follow trends. The trend will be either a rise in the value of a currency compared to another currency, or, a fall in the value of a currency compared to another currency. An example of a rise in a currency trend could be when the Euro increases in value against the US dollar. An example of a fall in a currency trend could be when the Euro declines in value against the US dollar.

You need to decide which of the three trading methods mentioned above that you are going to implement in your trading.

The moves of currency pairs throughout the day are often in a random manner making it very difficult to profit from day trading.

It is more apparent with swing trading when short term trends commence and end. This makes swing trading more profitable than day trading.

Long term trends in forex trading can last for quite a while, making this long term trading quite lucrative. There is a drawback to long term trading as the profits generated during the trend will experience days when they decrease. At times like this traders may close their forex trades as they find it difficult to deal with decreases in their profits. As a result the forex trader may well lose out on future trends in the currency pair.

Whichever method of trading you follow, ensure that you are trading in the direction of the trend so as to increase the probability of generating profits.

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by Stock Specialist ~ Thursday, July 30, 2009 0 comments

Forex trading robot for good profits

Forex trading robots are quite the rage and there are a few that can be labeled as best of the crop. Four of the best ones are briefly described below.

Forex Maestro is one of the most versatile and widely used forex robots in the business today. It combines the concept of artificial intelligence and neural network architecture to give you a very powerful and complex engine that is also simple to use and adapt to. It accounts large scale calculation and also uses an analytical perspective of market movements to give you the best possible trades for your money.

Marl doubling stocks is another critically acclaimed forex trading robot that provides some amazing real time results and tries to live up to its name of doubling. The system was developed by two engineers working on Wall Street and has been optimized over a period of ten years. The software presently is very robust and capable of giving some truly ingenious suggestions for the forex market. The best part is that it is designed to be cost effective and offers great value for money.

Forex Miracle is a robot which like its name suggests, is truly a miracle! It has unique features like giving you best case and worst case scenario suggestions. It also individually analyzes each currency pair using technical analysis so that it can accurately predict the future direction of the market movement by analyzing the pair's past price movement.

FAP Turbo needs no introduction and anyone who is aware of some of the best forex trading robots would have heard of its name. The software is simple by design and is made so that even a newcomer can start using it in a relatively short period of time. This software works best when the market is booming and attempts to reap in all the benefits to increase your wealth.

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Forex Robot

A forex robot is a widely acknowledged software or code that is claimed to simplify forex trading such that even a newbie will find it simple to start trading in the forex market. The main aim of the forex robot is to make sure that all known parameters are accounted for and you are only shown trades that match your specified criteria.

It is easy to get carried away by the claims of these robots and one should use caution so as to not become a victim of the marketing gimmicks. You need to understand that the trading market is a very intricate and complex environment that cannot be oversimplified into one program. Although these robots do offer advantages that regular trading don't, trusting them with all of your money might be a foolish decision.

To begin with, you can use the services of a robot so that your lack of experience may not be exploited by the traders. You need to realize that as you learn the tricks of the trade, you need to take in lots more into account while you use your machine along the side. If the code is not updated regularly, then the machine is as useful as a paperweight and continuing to trust it completely might be disastrous for your investments. A proper balance between using the machine and your own insights will reap rich dividends and ensure the longevity of your investments. If it was as simple as turning on a machine, then wouldn't the floor be full of only computers continuously trading between each other? Keep that in mind the next time you decide to entrust all your money on a forex robot.

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Forex Robots work like claim?

"Do forex robots actually work?" is one question that haunts many who plan to use it. Once you come to know about the concept of forex robots, you may be pondering whether it all seems too good to be true. Many individuals are in disbelief over the claims of this software and if they do all that they promise. It is tempting to get carried away with the marketing and go out and buy your copy, but as they say in Latin, Caveat emptor (Buyer Beware).

As per the survey, it is unfortunate that most of the individuals who were interviewed claim the forex automatic trading robots to be a scam and something that other should steer clear of. The root of ths is the fact that forex robots cost a bomb to purchase. Most of the reputed ones cost upwards of 2000 US$ and the really good ones can set you back by as much as 5000 US$. Once you invest this kind of money, you would want to get quick returns as well and this is the place where most people lose faith in the forex robot.

One should understand that trading forex takes time and you cannot master the art by simply going out and buying an expensive piece of software and letting it do the job for you. That would be foolish and will cost you dearly. Most of the people who are upset and claim the system to be a scam often bought it because of the glamour and promises that they saw in the infomercial. Remember that you should always test a product before buying it and the same holds good for forex robots. Work on it, use it for a while and then decide if it is what you are looking for.

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Forex Software

The forex software and service industry has literally exploded in the last few months and there is a lot of junk being thrown out at consumers to see who falls for it. Therefore, the task of assessing which forex software works best can be a daunting one.

The problem with most forex software, particularly those within the "expert advisor" category, is that they simply do not adapt to market conditions well enough to handle sudden and unpredictable movements caused by external factors.

It is a fact that the markets, whether stock or forex, behave according to certain patterns that tend to repeat themselves over time thus making it possible to somewhat predict what is going to happen next, being this the science -if you will- behind the numerous forex software available.

However, these patterns are not constant, they evolve, and this demands that traders do the same or at least use a strategy suitable for any market condition. Most forex software do not have the ability to evolve, nor they have a trading strategy capable of facing an ever changing market.

This is why you often see great results in back tests, but when you go ahead and download and use many forex software -each one claiming to be the best- you find yourself wiping out your equity in a matter of days, because the fact of the matter is that what worked in the past will not necessarily work today or tomorrow.

Therefore, in order to make sure you are getting the best forex software based on performance, you must look for alternatives that have been proven to work not only in the past, but in the present time. This will tell you that they are adaptable enough to make them profitable today and tomorrow.

Very few forex software and services have dared to take the step of showing how they work in live trading accounts that show the performance of the software on a daily basis, because doing this obviously poses a great risk for the developers, who would have the inadequacy of their product openly exposed in case that the results are not what people expect.

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Brokers Option regarding Forex

There are two seperate categories. one is forex brokers whom give or offer forex trading online and brokers who only give forex trading through telephone. Another broker offer bothe like telephone trading and online trading

The trading account minimums required by different forex option brokers vary from a few thousand dollars to over fifty thousand dollars. Also, forex option brokers may require investors to trade forex options contracts having minimum notional values (contract sizes) up to $500,000. Last, but not least, certain types of forex option contracts can be entered into and exited at any time while other types of forex option contracts lock you in until expiration or settlement. Depending on the type of forex option contract you enter into, you might get stuck the wrong way with an option contract that you can not trade out of. Before trading, investors should inquire with their forex option brokers about initial trading account minimums, required contract size minimums and contract liquidity.

There are a number of different forex option trading products offered to investors by forex option brokers. We believe it is extremely important for investors to understand the distinctly different risk characteristics of each of the forex option trading products mentioned below that are offered by firms that broker forex options.

Plain Vanilla Forex Options Broker - Plain vanilla options generally refer to standard put and call option contracts traded through an exchange (however, in the case of forex option trading, plain vanilla options would refer to the standard, generic option contracts that are traded through an over-the-counter (OTC) forex dealer or clearinghouse). In simplest terms, vanilla forex options would be defined as the buying or selling of a standard forex call option contract or forex put option contract.

There are only a few forex option broker/dealers who offer plain vanilla forex options online with real-time streaming quotes 24 hours a day. Most forex option brokers and banks only broker forex options via telephone. Vanilla forex options for major currencies have good liquidity and you can easily enter the market long or short, or exit the market any time day or night.

Vanilla forex option contracts can be used in combination with each other and/or with spot forex contracts to form a basic strategy such as writing a covered call, or much more complex forex trading strategies such as butterflies, strangles, ratio spreads, synthetics, etc. Also, plain vanilla options are often the basis of forex option trading strategies known as exotic options.

Exotic Forex Options Broker - First, it is important to note that there a couple of different forex definitions for "exotic" and we don't want anyone getting confused. The first definition of a forex "exotic" refers to any individual currency that is less broadly traded than the major currencies. The second forex definition for "exotic" is the one we refer to on this website - a forex option contract (trading strategy) that is a derivative of a standard vanilla forex option contract.

To understand what makes an exotic forex option "exotic," you must first understand what makes a forex option "non-vanilla." Plain vanilla forex options have a definitive expiration structure, payout structure and payout amount. Exotic forex option contracts may have a change in one or all of the above features of a vanilla forex option. It is important to note that exotic options, since they are often tailored to a specific's investor's needs by an exotic forex options broker, are generally not very liquid, if at all.

Exotic forex options are generally traded by commercial and institutional investors rather than retail forex traders, so we won't spend too much time covering exotic forex options brokers. Examples of exotic forex options would include Asian options (average price options or "APO's"), barrier options (payout depends on whether or not the underlying reaches a certain price level or not), baskets (payout depends on more than one currency or a "basket" of currencies), binary options (the payout is cash-or-nothing if underlying does not reach strike price), lookback options (payout is based on maximum or minimum price reached during life of the contract), compound options (options on options with multiple strikes and exercise dates), spread options, chooser options, packages and so on. Exotic options can be tailored to a specific trader's needs, therefore, exotic options contract types change and evolve over time to suit those ever-changing needs.

Since exotic forex options contracts are usually specifically tailored to an individual investor, most of the exotic options business in transacted over the telephone through forex option brokers. There are, however, a handful of forex option brokers who offer "if touched" forex options or "single payment" forex options contracts online whereby an investor can specify an amount he or she is willing to risk in exchange for a specified payout amount if the underlying price reaches a certain strike price (price level). These transactions offered by legitimate online forex brokers can be considered a type of "exotic" option. However, we have noticed that the premiums charged for these types of contracts can be higher than plain vanilla option contracts with similar strike prices and you can not sell out of the option position once you have purchased this type of option - you can only attempt to offset the position with a separate risk management strategy. As a trade-off for getting to choose the dollar amount you want to risk and the payout you wish to receive, you pay a premium and sacrifice liquidity. We would encourage investors to compare premiums before investing in these kinds of options and also make sure the brokerage firm is reputable.

Again, it is fairly easy and liquid to enter into an exotic forex option contract but it is important to note that depending on the type of exotic option contract, there may be little to no liquidity at all if you wanted to exit the position.

Firms Offering Forex Option "Betting" - A number of new firms have popped up over the last year offering forex "betting." Though some may be legitimate, a number of these firms are either off-shore entities or located in some other remote location. We generally do not consider these to be forex brokerage firms. Many do not appear to be regulated by any government agency and we strongly suggest investors perform due diligence before investing with any forex betting firms. Invest at your own risk with these firms.

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Should you invest in Forex Trading?
Should you get involved in Forex Trading? If you are already involve in the stock market, you should already have some idea of what Forex Trading really is all about. If you are newbie in trading, Forex Trading is actually investing your money into other currencies.

Let’s get into a little detail on what the difference between Forex Trading and Stock Trading. The stock market basically involves buying shares of a company and you watch a period of time of how that company does in order to have big returns. In the Forex Market, you are purchasing items or products or goods, and you are paying money for them and gaining or losing is due to the currency exchange differs daily from country to country.

In order to get ready for the Forex markets you can learn about trading and purchasing online using free “DEMO ACCOUNT� software. It is offer by most of the Forex Online Companies. Forex Exchange “Demo� is a program that allows new players to make purchase and trades in real Forex Markets with demo account; which means you don’t have to invest anything. This allows players to gain more insight on how Forex works. If you are new to this market, you could use this program to learn how to make decision based on what you know and also you could find out how you could feel when you are profiting or losing in Forex Trading. By using the DEMO ACCOUNT, new player can also gain more insight of knowing if they should get involved in this market.

If you are reading this article, it means that you already interested in investing Forex Exchange Market; but you really don’t know how to start! I invested in Forex Market for only a month, and I started with the Demo Account for 2 weeks. Currently I am trading actively and I think Forex Trading is fun and cool which I want to share my experiences with people who wants to invest a bit in this market.

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by Stock Specialist ~ Friday, July 17, 2009 0 comments

5 factors that make Forex Trading attractive

Forex Trading has been surging in popularity the last several years due to many factors from technological advances that have opened up the market to traders and investors looking to diversify their portfolios or migrating from the stock market.

Here is a list of 5 factors that I feel make the Fx Market an attractive one:

1. Demo Accounts - Feel that you're the next George Soros or you've got a can't-miss trading system? Well, you're going to want to test out your system or your speculation skills before risking your hard earned money. Demo account trading is where to start, demo losses may hurt your ego but they won't empty your wallet. Demo trading is also a great time to get acquainted with the characteristics of the forex platform you're going to be trading on, learn your market orders, stop losses and charting applications. Don't rush to trade real money right away, the forex market will be there next week, next month and next year, build your skills through practice and you will give yourself a better chance for success.

2. Democracy - The forex market is as close to a true democracy as a market will probably get. Starting with the fact that no region or country has a built-in advantage over any other region or country of the world. Unlike the major stock markets, the forex market trades continuously 24 hours a day, 5 days a week from the afternoon on Sunday to the end of the work day on Friday at 5 pm EST and allows all regions of the world to trade equally. The market is generally considered to trade in three sessions, the Asian session followed by the European session and then finally the North American session. The barriers to entry are also low as an individual retail trader can enter the market with a trading account deposit of just $1.

3. Liquidity - The forex market is the most liquid market in the world by far. The daily turnover exceeds 3 trillion dollars on any given day and dwarfs all of the world's major stock markets. Liquidity is attractive because with so many market participants, a trader can usually get a fair price to enter the market. Also, the enormous liquidity does not allow for any one entity to bully the forex market. A rare exception to this rule is when a central bank intervenes in the market as we have seen a few times already this year by the Swiss National Bank.

4. Leverage - Leverage allows you take a bigger trading position compared to the amount of money you have deposited in your trading account. Depending on your forex broker, leverage levels up to a 400:1 ratio can be found. This means that your broker will allow you to trade a position that is 400 times the amount in your account. Leverage gives you more bang for the buck but as it can magnify your gains, it also will magnify your losses. It is best to start with a small leverage ratio and increase if you feel comfortable.

5. Always a bull market somewhere - This is commonly said about the forex market and it is true. One of the most interesting characteristics of trading in the forex market is the currency pair nature. In the over-the-counter spot market, currencies are directly traded against each other. For example, when the USD/CAD currency pair is rising, there is a bull market in the USD and a bear market in the CAD as more traders are buying the USD and selling the CAD simultaneously. This dynamic is always present throughout the forex market and proves the statement true that there is always a bull market going on.

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For Real Money Learn To Trade Forex

The Forex market is where big money is made and lost. With the daily ups and downs found on the Forex some traders have made a lot of money. Forex, is the foreign exchange market.Forex Trading can be done online through a broker or a financial institution and operates 24 hours a day. Because it involves trading currency from all around the world it must be accessible by every time zone.

When you are thinking about learning to trade Forex markets you should know you are buying and selling foreign currency. With the volatility of the Forex markets the currency is very rarely held onto for a long period of time. The daily changes are determined by the ups and downs of any countries currency. This can happen minute to minute or hour to hour. The changes can come quick so it is not for the faint of heart. Most traders who learn to trade Forex markets do so because of the explosive profit potential.

Most traders who learn to trade Forex are former stock day traders who have lost the zest for trading in a market that is filled with uncertainties. Don't get me wrong the Forex market definitely has its unexpected ups and downs but what it doesn't have is unethical CEO's and stock dilution. Most Forex traders are very well seasoned and experienced technical traders, meaning they are able to read graphs to forecast potential currency fluctuations. Most traders use technical analysis to analyze past and present Forex market data and then search for trends.

Technical analysis can work very well for experience traders and it allows traders to better predict the trends of a specific currency. One of the reasons there are such great profits made is because the Forex offers 100:1 leverage on your money. This allows traders to control $100,000 with only really investing $1,000 of their own funds. There are obviously traders who control millions on any given trade which can lead to huge profits on the slightest change in the currency market. With the power of technical indicators and with the liquidity of it, the currency market reins supreme marketplace. There are numerous sites devoted to teaching people to learn to trade Forex markets. The training focuses on reading technical analysis to try and trade the daily trends. These sites also focus on how to incorporate news into your daily trading routine. News can be a huge mover of the Forex markets in both long and short terms.

There have been many millionaires made from learning to trade Forex but I am sure there have been just as many who have lost millions. Many traders are afraid of the volatility and danger of trading the Forex markets there are many who are drawn to it for the same reasons.

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What is the Forex?
What is the Forex? The Foreign Currency marketplace is where worldwide exchange rates are derived for everybody, as well as, marketplace speculators and end users of currency. It is the biggest and least regulated monetary

marketplace in the world. There are pros and cons to this situation.

This cash-bank marketplace was established around 1971, when floating exchange rates began to materialize. The daily turnover has increased

from around $5 billion in 1977 to more than $3 trillion now. This marketplace is available 24 hours - 6 days a week. Put in the simplest terminology, supply and demand for currencies determine international exchange rates. You might ask what is an exchange rate? An exchange rate is the rate With which one currency can be exchanged in place of another. In other words, it is the price of one country's currency compared to that of another. When traveling to other countries, you need to "buy" the home

currency. Just like the cost of any asset, the exchange rate is the cost at which you can acquire that currency.

For example, if you are a European deciding to travel to the US and the exchange rate for EUR 1.00 is USD 1.50 this means that for each Euro, you can purchase one and a half US Dollars.

The most up-to-date article, concluded in 2007, estimated the normal international daily volume at approaching 3.2 trillion traded in the world's foremost monetary markets, of which an estimated 95% is speculative. Its every day transaction volume is more or less 100 times that of all the stock-exchanges collectively. The reality that 95% of the marketplace is speculative means that nearly everyone of the participants buying a currency really have no plan

of receiving that individual currency just sell it when it is producing a profit.

Durable economies maintain strong currencies. When we trade the Forex markets, we are trading economies. Therefore, supply and demand used for a specific currency depends on the current and likely future shape of that country's financial system. We can look at and assess the demand and supply used for a country's currency through fundamental and technical analysis.

Importers and exporters are forever involved in the currency markets as well.

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