Posts Tagged ‘futures’
Wednesday, December 10th, 2008
The main function of the foreign exchange market is to support the trading of assorted global currencies. Although the majority of trades concern only a small number of currencies, including the U.S. Dollar, Yen, Euro, Swiss Franc, Pound Sterling, Australian Dollar, and Canadian Dollar, many other different types of currency are exchanged on a smaller scale. Over 90% of all exchanges on the forex markets involve the U.S. Dollar.
The forex market is, despite the popular impression, a composite of several contrasting markets, each of which sustains its own rules and regulations, with no one centred market in which all currency trading takes place. Because of the different time zones the major markets, which are located in the U.S., London, and Tokyo, open during different hours. When the New York market opens, and while the European markets are still operating, is when trading is heaviest and nearly two thirds of the trading action happens during this convergence.
An Individual exchange rate for a given currency does not subsist since there is no centred market. Whilst they are normally reasonably close to each other, the bid and ask rates for a currency can deviate among dissimilar geographic markets and market makers because of the over-the-counter (OTC) nature of the markets.
Each currency has an international currency code which is displayed by trio of letters and since the price of a currency must be given in relation to another currency, it is expressed in the form XXX/YYY. The price of Euros in U.S. Dollars is written as EUR/USD, for example. The strongest currency when the pair was created is generally the first in the pair and known as the base currency, and the other currency is called the counter currency. Typically rounded to the nearest ten-thousandth of a unit the actual prices themselves are displayed in decimal form.
Approximately $1.9 trillion changes hands every day in the forex markets and it constitutes the biggest marketplace in the world. With nearly 80% of trades lasting less than a week forex trading is largely a speculative, short-term market. With the many traders encompassing the globe and the very high daily turnover it is an exceedingly liquid market, much more so than equities.
Nearly three quarters of total dealing volume, however, involves the top ten most active traders. Known as the interbank market and made up of international banks, the trading activity that takes place between them supply the market with bid and ask prices that are far tighter than retail clients can anticipate.
Forex futures contracts, that are derivative instruments that are also actively traded was inaugurated in 1972 at the Chicago Mercantile Exchange, and are responsible for approximately seven percent of the total foreign exchange volume. Another popular hedging strategy that has also taken hold is foreign exchange options. Investors often buy these derivatives, which are contracts to purchase currency at a certain price on a future date, to counterbalance the decline in the price of a currency and any possible losses they might endure.
An additional means traders are capable of mitigating risk is through an exchange, in which both parties agree to switch one currency for another for a set period of time, and will then reverse the transaction after the period runs out.
The foreign exchange market is a fast-paced, international currency exchange that is without competition amongst financial markets.
International companies, prominent banks and financial organisations will ensure its huge popularity continues and its growth is guaranteed into the future.
You can access more information about forex trading at http://www.forex-revealed.info, a popular website that provides tips and advice to achieve success in the forex market.
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Thursday, November 20th, 2008
Forex trading online is a fast way to use your investment
capital to it’s fullest. The Forex markets offer distinct
advantages to the small and large traders alike, making
Forex currency trading in many ways preferable to other
markets such as stocks, options or traditional futures. Here
are seven reasons why you’ll want to look into Forex Trading
online.
1 - Forex is the largest market.
Forex trading volume of more than 1.9 billion, more than 3
times larger than the equities market and more than 5 times
bigger than futures, give Forex traders nearly unlimited
liquidity and flexibility.
2 - Forex never sleeps!
You can execute forex trading online 24/7, from 7AM New
Zealand time on Monday morning, to 5PM New York time on
Friday evening. No waiting for markets to open: they’re open
all night! This makes Forex trading online a very attractive
component that fits easily into your day (or night!)
3 - No Bulls or Bears!
Because Forex trading online involves the buying of one
currency while simultaneously selling another, you have an
equal opportunity for profit no matter which direction the
currency is headed. Another advantage is that there are only
around 14 pairs of currencies to trade, as opposed to many
thousands of stocks, options and futures.
4 - Forex Trading online offers great leverage!
You can make the most of your investment resources with
Forex trading online. Some brokers offer 200:1 margin ratios
in your trading accounts. Mini-FX accounts, which can
typically be opened with only $200-300, offer 0.5% margin,
meaning that $50 in trading capital can control a 10,000
unit currency position. This is why people are flocking to
Forex trading online as a way to highly leverage their
investments.
5 - Forex prices are predictable.
Currency prices, though volatile, tend to create and follow
trends, allowing the technically trained Forex trader to
spot and take advantage of many entry and exit points.
6 - Forex trading online is commission free!
That’s right! No commissions, no exchange fees or any other
hidden fees. This is a very transparent market, and you’ll
find it very easy to research the currencies and the
countries involved. Forex brokers make a small percentage of
the bid/ask spread, and that’s it. No longer any need to
compute commissions and fees when executing a trade.
7 - Forex trading online is instant!
The FX market is astoundingly fast! Your orders are
executed, filled and confirmed usually within 1-2 seconds.
Since this is all done electronically with no humans
involved, there is little to slow it down!
Forex trading online can get you where you want to go
quicker and more profitably than any other form of trading.
Check it out and see what Forex trading online can do for
you!
Keith Thompson is the webmaster of Forex Trading Today; a blog focusing on the latest Forex news and resources.
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Sunday, November 16th, 2008
Easy Language
TradeStation gives you the power to right code in Easy Language in order to back test your trading strategies. Now, while the name of the code is Easy Language, it is far from easy. If you have previous coding experience, then Easy Language will remind you a lot of C++, but if you have no previous coding experience, do not waste your time on trying to learn the syntax. Simply look to their third-party programmers for assistance. These developers are backed by TradeStation and they do not charge and obscene amount of money. Better yet, if you have a friend or relative that knows how to write code, they will quickly be able to write basic strategies for you.
TradeStation provides some basic literature on Easy Language, but if you want to really get your feet wet, you will have to purchase their home study course, which will run you a cool $149. Again, if you are here to trade, trade, and leave the developing to the programmers.
Historical Market Data
TradeStation has over 25 years of historical data. When you look a little closer, the amount of data is dependent upon which investment vehicle you are using:
- 4 years of intra-day Forex data
- 8 years of Eurex Futures and Index Data
- 16 years of intra-day Equities
- 25 years on intra-day Futures data
So, the real question is do you need all this data from TradeStation. Well, of course, if you are serious about testing your trading strategies. This amount of market data will allow you to back test your strategies in bull, bear and flat markets. You will quickly see how you would have faired in the bull market of the late 90’s, or the slippery slope down in ‘01 and ‘02. Most importantly, you can see how you would have done since the market recently bottomed in the spring of ‘03.
Automated Trading
I do not endorse mechanical trading, as I feel every trader should be responsible for his or her own trading decisions, but I have to admit, having the option of setting up automatic trading is impressive. In order to activate this feature, you should be certain that your strategy is working properly and has clear stop rules. The last thing you want is to take lunch and come back to realize you just bought a 10 thousand dollar hotdog. TradeStation also has a new feature that allows you to execute orders based on fundamental analysis. TradeStation is the first platform capable of scanning and executing orders based on fundamental factors.
Back testing Strategies
There is one part of back testing that TradeStation does not tell you about and that is slippage. When you write your Easy Language code, you can tell the code to exit a trade on the close of the current bar, or ext at market on the open of the next bar. The problem is you may want to write the code to get out at a specific price. Now, all of you Easy Language experts out there, please relax, I know that you can write code to get out at any particular price, but the average trader will not know how to write such detailed code. So, in summary remember that if you write your own code, the canned functions in Easy Language will not allow you to easily code your exits. Just make sure you verify in your performance report that your results have not been inflated or deflated due to slippage.
TradeStation will display a report of your hypothetical trading results. The TradeStation performance report lists everything from average time in trade, average gain, total commission, annual rate of return to name a few. Only problem, you cannot export the data to excel. So, one is forced to manually type in stats into your friendly worksheet processor. Depending on how much information you want to analyze, this exercise could prove to be time consuming.
Trade Execution
TradeStation has the quick order button execution of every other active brokerage firm. But the cool thing with TradeStation is the Order Cancels Order (OCO) and Order Stages Order (OSO) order types. For Order Cancels Order, you can instruct TradeStation to enter a position if the price breaks up or down. This works well when you have identified two levels on a stock as potential long or short entries depending on how the price breaks. The Order Stage Order allows you to stage multiple orders for an existing position. So, if you are long MSFT and want to exit in 3 increments, you can create an OSO order which will stage the orders and when a certain price is hit, it will exit a part of your position at a specific limit. I often hear traders say that they do not want to put a stop in, because if there limit is hit, they will have to cancel their open stop order, to then put in a limit order to exit the trade. Well, with OSO in you can place both a stop and up to 3 limit orders in TradeStation, so there is no longer any excuse as to why you can not protect your capital, the second you get in the trade.
Shorting
TradeStation does not have the books to short some of the more obscure stocks. So, if you want to short stocks that are not well known, you may encounter some trouble with TradeStation. This does not happen often, but it happens enough that it is noticeable.
Charting
The charts in TradeStation are in real-time and there are over a hundred indicators, show me, paint bars, etc. which can be displayed on the chart. The only negative is that you cannot execute trades by clicking directly on the chart. There are multiple screens in TradeStation that will allow you to close a position; unfortunately, the chart is not one of them.
Ability to Link Accounts
TradeStation has the ability to link all of your accounts. Therefore, you can trade futures, one minute and then put on a trade in your equities account the next. This is extremely convenient, since you do not have to open another application or go through the tedious process of logging into another account.
Commission Structure
If you are an active trader and you trade under 1k shares per lot, TradeStation makes sense. TradeStation has a per share cost up to 500 shares. The first 500 shares are $.01. So you can buy 100 shares for a $1 and up to 500 shares for $5. Over 500 shares, it is $.006 per share. So, if you trade 3k shares, TradeStation can become costly. The first 500 shares will cost 5 bucks and then the last 2.5k shares will run you another 15 bucks. The total cost would be 20 dollars one-way for the trade. In this example, it of course would be much cheaper to trade with a brokerage firm that has a flat charge for all trades. In summary, if you are going to trade in big lots, 1k or more, go with a flat fee brokerage firm, but if you’re going to trade under 1k lots, TradeStation is the place for you.
Support Center
TradeStation has a support and discussions forums, where traders share ideas, stories and Easy Language code. Unlike many forums, where there are only a few users, the TradeStation forum has hundreds of quality posts. I have been able to pickup tons of ideas as well as free Easy Language code for some of my strategies. Each post is grouped in categories and the users are quick to respond to your questions. TradeStation has also recently started a Wiki for both their platform as well as Easy Language. The Wiki is expanded daily. TradeStation also has a dependable phone support staff. I have yet to call and not be able to get someone on the line with in 15 - 30 seconds. The staff is always attentive and willing to help on any issue. There is a sales desk, equities desk, futures desk, and forex desk. Each department specializes in their respective areas, which prevents you, the client, from ever talking to someone who is unknowledgeable on how to address your issue.
Radar Screen
TradeStation is the only trading platform, which has a radar screen that can scan the market based on your own market criteria. Now this is not your standard, scan that can display stocks with an RSI under 30. The scan in Radar Screen can be as simple or as complicated as your Easy Language abilities will permit. So, if you want to look at stocks at 2-day highs, with 25k shares per minute, that are up a minimum of 2%, you can scan the market for this information in real-time. The only negative regarding Radar Screen is TradeStation only allows you to scan the market for 1k stocks. But, who needs to monitor more than 1k stocks?
See You At The Top,
Al Hill
Al Hill is the co-founder of mysmp.com (My Stock Market Power) which provides free trading articles to investors. Please visit http://mysmp.com/trading-articles.html for more free articles.
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Tuesday, November 4th, 2008
Many of you have traded stocks, mutual funds, and maybe even futures before. The Forex market is relatively similar to these markets; however, I would like to cover some key differences that you should be aware of before you begin trading in the Forex market.
Getting Started - Pick a Broker
I am sure many of you have seen hundreds of ads over the internet from Forex brokers trying to earn your business. There so many to chose and you need to get answer to a few key questions before you go with any one broker.
Spreads
The Forex spread, which is similar to the difference between the bid and ask in the equities market, is calculated in pips. Unlike the equity markets where you can place limit orders to buy at bid or the ask or even between, the Forex market allows you to execute at only one price, the ask. It is basically the same as only being able to execute market orders in equities or futures. The “spread” in the Forex market is how the brokers make their money. They do not charge any commission. Therefore, it is imperative that you search for brokers who offer the best spreads.
Reputation of the Firm
Forex market brokers offer massive leverage to their clients and therefore require backing from large banks and other financial institutions. Make sure your Forex broker is registered with the FCM, or the Futures Commission Merchant. Also make sure that the broker is regulated by the CFTC, or the Commodity Futures Trading Commission. This information should be readily available on the brokers website. It is important that you verify this information before opening an account with the broker. Also, search around for feedback regarding some brokers that you are interested in opening an account in. If they have committed any “shady” acts, it will be documented on the internet.
Leverage Options
Leverage in the Forex market is necessary to make any significant profits. This is because currency pairs move in small fractions and require large investment amounts to make any significant profits. Most brokers offer 100 times margin while some may go as high as 250 times. Obviously, the greater the risk, the greater the reward and so goes the same on the opposite side. If you have limited funds for investment into the Forex market, find a reliable broker who offers higher leverage.
Be careful of brokers who have stringent margin rules. Remember, margin is borrowed money and that means that the broker has a vested in interest in how your trading is working out. Therefore, in some cases, I have heard of brokers liquidating positions in your Forex account at their discretion, even if you have enough cash on hand to cover the drawdown. Ask them how they handle this situation. The last thing you want is to be surprised that your brokers rules don’t allow you to trade in the way you want to.
The “Extras”
As we suggested in our Forex Trading introduction, it is a good thing to paper trade the Forex market before you go in with real money. Every market trades a little different and it would be wise to get used to this market first. Many brokers offer free tools that will allow you to open practice trading accounts and trade with live market data. This is a great feature to look for in a broker. Remember, you are implicitly paying your broker quite a bit of money when you place trades through them. Make sure to get your moneys worth! Most of the top brokers in the Forex market offer free real time charts and news and common technical analysis tools. Some trading platforms, such as Tradestation, offer clients the ability to create automated trading strategies to back test their trading systems and also to automate a trading strategy to run on its own without any human intervention.
Trading the Forex Market
As in equity or futures markets, technical and fundamental analysis become the cornerstone of your analysis; however, technical analysis is far more prevalent. There are far more automated trading systems in Forex markets than there are in equities and futures.
From a fundamental point of view; traders will rely heavily on a few key reports: Retail Sales, Durable Goods, Fed interest rate decisions, CPI Index (Consumer Price Index), Non- Farms payrolls, and the PMI (Purchasing Managers Index). Keep an economic calendar handy to stay on top of these news events. They cannot be ignored, even if you are a technical analyst.
From a technical analysis point of view, price and volume analysis is key. Most prevalent in the Forex market is Fibonacci studies, RSI studies, Parabolic SAR, and Elliot Wave to name a few. Many traders will experiment to figure out which trading system fits their personality. This takes time and patience. Remember, paper trade your account until you become proficient at trading the Forex market. They make it very easy for you to practice.
See You At the Top,
Kunal Vakil is the co-founder of mysmp.com (My Stock Market Power) which provides free trading articles to investors.
Please visit http://www.mysmp.com/ for more free articles.
I have found this resource a great place to start in your search for your Forex broker: http://www.fxstreet.com/brokers/forex-brokers/
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Sunday, October 26th, 2008
There were a lot of worried faces today when the Dow Jones Industrial Average dropped some 450 points mid day. Excited faces that were full of joy just a day ago now looked very worried, and fearful, and this was reflected in the jittery responses of 4x software traders.
As someone who had rode through several markets crashes including the Black Monday drop, and as a professional trader, what would be the best response when the stock market crashes?
Being in the stock market is not about being always right in the market. You could be wrong, and be caught , as I would expect many traders would be with this market crash, but it would be your response to the crash that could help you mitigate the losses and difficulties and 4x software you ride through the storm and even to rebound strongly, in many cases, with a profit several months down the road.
At the onset of a market crash, quickly assess your overall portfolio. If you are still in profits, consider liquidating.I am talking about your overall portfolio, not individual stocks. This response is taken especially if you treat trading stocks and shares as a business, and it is the bottom line that counts. A profit is a profit, and your mentality is to manage your business as a fund. By doing so, you are protecting your capital and your profits. If you have separate portofilios involving long term position stocks and the short term trading stocks, it is the short term trading portfolio that warrants your attention. You will move back into the market later when stock prices stabilise and you would have a good chance to buy them lower.
If you are not selling your stocks, do not average or buy more stocks at a lower price immediately, until there are confirmed signs that the market has stabilised. It is like catching a falling knife when the market is dropping, and especially if the market drops are due to external factors. What is low today can become lower especially if the falling momentum increases as the day passes.
When a market has crashed, the mood will have decidedly changed from bullishness to bearishness. The first few days after a crash, there is confusion. It is during these moments of confusion that having a clear direction and a trading plan for bearish periods, would put you into focus with a clear way how to trade or ride out these turbulent times.
It is during a market crash that there is a flight back to quality stocks, and also traders will be exploring new avenues for making a consistent replacement income. When things look bad in the stock market sector, there would be many traders who will want to look at trading other financial instruments, such as currencies and forex. The forex market is active 24 hours every day, and represents the biggest financial trading market in the world. For the trader, as long as the sun rises and the sun sets, the world of trading continues, irrespective of its outward form as stocks and shares, futures and commodities or currencies and forex.
Peter Lim is a Certified Financial Planner. To discover how you can make money from the forex trading during stock market crashes, and to earn a substitute or replacement income trading forex, visit the author’s blog at http://1forex-trading.blogspot.com
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Saturday, October 25th, 2008
If you want to enjoy currency trading success, you need to catch and follow trends and spot turning points and this tool will help you - it’s an obvious tip in many respects but most traders simply don’t use it, so here it is.
It’s to look at other markets that impact on the currency you are trading and for the purposes of illustration let’s look at the US Dollar.
The dollar is a net importer of energy and high energy costs hurt it and the main one we are referring to here, is crude oil. In recent history when crude has hit high levels (and we have had recent tests of $100 a barrel) it has hurt the dollar and the retreat from this level has seen the dollar stabilize and rise.
Tops in the oil market recently have warned of dollar rallies.
Another major factor is interest rates.
Recently the dollar has been hurt by the perceived view that interest rates will be cut and you can get an idea of how much by looking at interest rate futures. When the interest rate futures rally too hard to fast and then fall, you can often see the dollar rally.
Why? Because traders get ahead of themselves - the recent rally in dollar euro was preceded by 100% consensus that interest rates will be cut by 50 bps (probably true) but gave 50 - 50 that rates would be cut by 75 bps (unlikely) the level of interest rate cuts factored into the market was overdone and prices in interest rate futures fell and the dollar rallied.
Tops in oil and interest rate futures can be used to warn of dollar rallies.
Another important variable is the stock market. Weak stocks hurt the dollar and strong stock markets support it - so watch it in fact if you want another tip:
If you are trading long term trends and only want to look at the prices of currencies once a day, do it just after the stock market closes. This closing price is always significant and while currencies trade 24 hours they are effectively thinly traded until Tokyo opens and the US stock market close sets the tone for the next day
Other currencies are also affected by outside influences:
The Canadian Dollar - Is a net exporter of oil and high prices of oil and other commodities are supportive of the currency
The Australian Dollar - Australia is a big producer of gold and when gold prices are high it supports the currency.
By looking at other markets that are important to a currency, you can often spot whether trends are going to continue or reverse. While it’s obvious that currencies don’t move in isolation, many traders do not bother to look at other markets for clues - if you do, you can get a trading edge.
A trading edge is what forex trading is all about and if you research this tip further, you will find it very useful as part of your forex trading strategy for bigger profits.
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Friday, October 24th, 2008
Are you looking to learn strategies of Forex currency trading? If you are a beginner, it is crucial that you gain some basic understanding of this market before you risk your hard earned money with it.
1. What Exactly Is The Forex Market?
This is the largest financial trading market in the world, with trillions of dollars exchanging hands every day. The stock market and futures market dwarf in comparison to the size of Forex market.
2. How Does Forex Trading Work?
Every time you enter an order with your broker, you will be buying one currency while selling another. That is what happens in the currency market all the time as currencies are always traded in pairs. The major currency pairs include the EUR / USD, USD / CAD, USD / JPY and AUD / USD.
3. How Likely Is It To Make Money With Forex Currency Trading?
It would be unrealistic to imagine that you can start making money by trading manually if you are a beginner. Forex trading requires skill and a lot of patience and discipline. Start off by learning some trading systems and executing them on a demo account before opening a live account.
4. Always Be Prepared With A System And Know When To Exit
Before you even start trading, you should figure out when you will enter into a position, and under what circumstances you will exit your position. Do not decide only after you have started trading or you will find yourselves making rash decisions.
If you have less experience with Forex trading, I would highly recommend you to start with automated trading robots. Nowadays, I use trading software that trades Forex and makes money for me automatically. You can find out more about it at the website link below.
Are you interested to find out more about the automated Forex trading software? Read the author’s review of the Top 5 Forex Trading Systems on the web at http://www.review-best.com/forex-trading-robots.htm first!
The author has found a 100% automated Forex Trading Robot that is making him over 20% returns on his capital every month. CLICK HERE to find out about it!
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Thursday, October 23rd, 2008
Forex online option trading is a brand new opportunity as of 2007 for individual investors to trade options on world currencies. Offered through the Philadelphia Exchange world currency options are traded in exactly the same way as any other option. Currency options offer a major benefit to those interested in FX trading.
Up until 2007, the only way to trade in currencies was through futures, and through forex market makers. Both involve a much greater degree of difficulty than simply trading in forex currency options. In futures, there is a great deal of risk. If your position moves against you, your loss can be potentially unlimited. In both futures and spot FX markets, you are tied to your trade 24 hours a day, watching and guarding against constant fluctuations. While you still have to keep an eye on your positions, world currency options are traded only when the stock market is open.
Forex online option trading is available through almost any online broker that deals in options. Just like a stock, you simply need to know the symbol to find the option chain or chart. For example, in Forex, the Euro/US dollar currency pair is called the EURUSD. In forex online option trading, the symbol is XDE.
Currency option trading is as simple as identifying the direction of the trend and buying a call if you think it’s going up, or a put if you think it’s going down. You can buy an option for a month, three months or more.
Using forex online option trading gives you a few major advantages. Your risk is limited to the price of the premium - and you can easily employ a stop, further limiting your potential for loss. With FX currency options it’s much easier to take a position and hang onto it for the longer duration of a trend. Your risk is limited and your potential for profit is virtually unlimited.
The one thing to remember in currency option trading is that of the six pairs that are available with options, four of them are reversed if compared to the FX currency pairs. All of the currency option pairs are settled in the US dollar.
For more information on forex online option trading, please visit http://www.squidoo.com/forexonlineoptiontrading
Tags: advantage, Ally, amp, avail, Basics, Benefit, broker, ck, currencies, currency, currency option, currency options, currency pairs, dea, Dollar, duration, Employ, eurusd, Fi, fit, fluctuation, fluctuations, forex, forex currency, forex market, futures, fx market, fx trading, Gr, gre, individual investors, informat, investor, investors, Irs, market, markets, online broker, online option trading, option chain, Option Trading, pairs, risk, sit, stock, stock market, target, trading, world currencies
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Wednesday, October 22nd, 2008
Trading is just as much of a business as any other industry. Treating what you do as a business will help you improve your trading, allowing you to trade with less emotion. Constantly set trading goals to work towards, just as you would create goals for any business. Here are a few tips to improve your trading as a business, helping you reach your trading goals.
1. Your Trading Plan is Your Business Plan - Your complete trading plan is much like a business plan. Included in your trading plan planner should be a concrete statement on how to generate profits and your specific strategies. Much like your own business, you should have a plan in place to reach your trading goals. Setting swing or day trading goals is critical to producing consistent profits and staying “in business.”
2. Profit Loss Sheets - Bookkeeping may come second to technical analysis and e-mini futures, but it is just as important as day and swing trading itself. You should prepare a profit or loss statement every month and track where you’ve made money and lost money. If you’re finding yourself losing money in the 10 am - 2 pm period of the trading day, you might consider closing up shop during that time.
3. Have a Routine - If you were going to the office every day, you wouldn’t go in sweatpants and a t-shirt. You should be dressing the way you want to perform. Getting up early and getting ready just like you would for any other occupation will keep your mind in the game and bring in consistent earnings. You need to treat yourself the same as you would with a business. Set a trading goal for each day and strive to reach it with profitable trading strategies.
4. Use Profits to Grow - Businesses need more capital to expand and make more money and so does your portfolio. Spending a few extra dollars on advanced trading techniques, tools, and strategies will help you be a better trader. Mark each expenditure against the value of your trading portfolio as you would against the bank account of your business. Each investment is an investment in yourself, and it is also tax-deductible, just like any other business expense.
5. You’re Buying and Selling a Product - Shares of stocks are products just like an article of clothing or a pound of carrots. Trading is buying and selling a stock for a profit, much like owning a business is buying and selling a product for a profit. Think of each stock like a product; you might have to have “sales” to get rid of extra holdings or to cut losses, but it is all a part of running a business.
Organizing your trading life like your business increases your probability of market success. When you take time to manage your business, invest in your business, and treat yourself professionally, these are the tools to make consistent profits.
About the Author:
Leroy Rushing is an active, professional day trader; trading coach; and author. He is the Founder and CEO of Trading EveryDay, a distinguished provider of educational trading products and services that are available worldwide. Trading EveryDay also has many articles with unique perspectives on day trading.
Tags: account, Ally, avail, bank, bet, bett, Bookkeeping, business, business plan, capital, Carrots, ceo, ck, Coach, Consistent Profits, day trader, day trading, Dollar, Earnings, Education, Emoti, emotion, Fi, fit, futures, game, goals, Gr, home, inc, investment, losses, lost, lot, lpi, market, money, perspective, pita, probability, profession, profitable trading, profits, Rate, running, running a business, Rush, sales, stock, stocks, target, trading
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Tuesday, October 21st, 2008
Let’s review a few current day issues.
We have an economic crisis on multiple fronts, a health care crisis, a health insurance crisis, corporate hierarchies are making greater profits while workers wages stagnate, food and fuel prices are skyrocketing, a couple of wars are causing our national debt to explode and yet the vast majority of people (primarily parents with children!) in this country seem fixated on entertainment and sports as their primary priorities. Even media outlets as well as journalistic sites like this promote such priorities by reporting and request articles on entertainment, styles, sports and celeb gossip!
Oh, but even in the face of the ominous issues cited above, these are not misplaced, perverted priorities! Is it any wonder our elected officials ignore us? I would if I were them! To quote a label from Aldous Huxley’s Brave New World, it appears as though the general public has a very good chance of being inducted into the “Semi-Epsilon Moron” club!
Amid all these issues, one would expect folks to take positive action, albeit in their own small way, in their own lives, to effect change, despite sacrifices to their image or entertainment venues. But no, quid pro quo reins king, as the people continue on with their most important priorities of entertainment and sports fueled by a media which places a focus on “news” about entertainment, sports and celebrity. As apathetic excuses are aired with, “What can I do about it?”.
Let’s see. Maybe dump the truck or SUV and suffer your image with a hybrid or small sedan or compact? Perhaps dump the 3,000 channel TV subscription for a basic level? And take the money saved from these two “sacrifices” and purchase some basic health care insurance? Oh, God no! Maybe volunteer at or donate to a local food bank? Or how about ignoring and tuning off those grossly high paid sports figures to spend that time with an eco-organization planting trees or managing a green area locally? Now that’s just far too much to ask.
Now let me get this straight. You spend how much of your hard-earned pay each week following and supporting your favorite sports and entertainment figures - the ones who are paid how much more than you? - to add to their wealth and deplete yours?! That’s not “Semi-Epsilon Moron”?!
I could go on but the sneering and snickering will only grow louder. So, just continue on as usual and suffer through all the serious issues. They’ll all “go away” some day…won’t they? Maybe in your own mind as you continue to ignore them and block them out with your entertainment and sports.
As for me, I’m trading in my Kia Spectra for a Hummer and plan to drive no less than 85 MPH on the highway….EVERY time!…Just like everyone else! No more recycling for me, either! Won’t contribute any more time or money to that local eco-club that manages green areas. Going to dump my health insurance so I can go out and buy a few “toys”. I’ll end my contributions to charities and invest in some corporate giant who takes advantage of workers in order to make good profits for shareholders. But I’ve never had much respect for sports figures and little interest in celebs, yet there are other things I’m involved with I can cease and desist from in order to stop making a positive contribution toward resolving the serious issues.
Heck, if the vast, vast majority of people - and they’re the ones with children! - continue to prioritize image, entertainment and sports - and affordability has absolutely nothing to do with it! - and don’t care to act for the betterment of the future of their own kids, outside of their financial futures, why should any of us without kids care what happens economically and environmentally, nationally or even globally? Let the serious issues snowball and escalate! Let the kids suffer in the future more than we are now! Se La Vie!
Sleep well!
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