Scalping the market

Scalping - a way of constantly increasing deposits through the use of high leverage and a large number of short-term trading.Typically, the goal is only 1.5 pip per trade. This type of trading strategy is suitable for those who followed the auction day and wants to minimize losses.

However, a small amount of time spent in a bid to limit the risk to a greater extent than long-term strategy. The freedom associated with the rapid scalping the market, attracting more traders from other markets in the Forex, like a magnet, to test their strength in the currency. Disciplined and permanent trader can easily double or triple the deposit, holding only a little time in comparison with the trader, who is bidding or watching the market all day long.

Scalping conceals some difficulties in the online currency trading. If you want to use this method, you will definitely need to find a broker that supports the system of scalping. Many brokers do not allow the use of this system, because if you quickly enter and exit trades, a broker may lose a significant amount of money. She also does not allow brokers to trade against their clients, which is another way of profit for brokers.

Seasons Forex

Trading currencies on the online Forex, you often have to make a choice: for or against the dollar. The dollar is 90% of the currency pairs and causes the majority of fluctuations in interest rates. Many traders predict the dynamics of the dollar with the help of fundamental and technical analysis. However, few realize that time of year also plays a major role in the behavior of the dollar against other currencies, then there is a change in the behavior of exchange rates can be tracked over many years in the same time.

Eg., Do you know that over 8 out of 10 years (1997-2006) U.S. dollar has grown against the euro in January? Or that for 9 of the 10 previous years the U.S. dollar has grown concerning the Japanese yen? While there is no guarantee that historical patterns are sure to recur, the fact that the pattern was repeated 80-90% of the time, makes this phenomenon is very important. This information may be useful to you during the bidding process.

The most striking example of the seasonal behavior of couples will be USD / JPY in July. In 90% of the USD / JPY finished the month at a higher level than at the beginning of the month. This is not a precise explanation, but may affect the course of the first quarter ending in Japan or the beginning of the second half of the year in the United States.

Why most traders use technical analysis?

For many years Forex traders based their decisions in online trading on fundamental analysis, which explores the past and present economic and political conditions for predicting currency fluctuations in the future.

However, fundamental analysis is not very easy to master, it requires a large amount of knowledge and skills to analyze a lot of data. So today most traders use technical analysis, which is much simpler and clearer fundamental.

It is important to understand the 3 main principles of technical analysis:

1. All the possible forces will lead to the exchange rate, including economic and political events, but they do not have much significance. For technical analysis principal value are themselves exchange rate fluctuations.

2. The price of the currency should be a definite trend, which can be determined by looking at the schedule and its curves.

3. The price of the currency should not only be a trend, but will continue to follow him in the future.Movement of prices in Forex - is a sequence of reactions of people in a certain manner, which will continue for some time.

Remember that not yet developed the kind of analysis, which can 100% predict the trend for the currency exchange rate.

"Can" and "impossible" for each trader

In this paper, Forex traders have their advantages and disadvantages. This is difficult work, but for the diligent and attentive, it can be worthwhile and successful business. Most people think that trading in the Forex - a game of numbers. But in fact, be able to analyze the details, make predictions, to achieve success.

The first thing to do, if you decide to become an online Forex trader, to determine the currency pairs.

Will focus on the major currencies, which are widely used in the auction. Monitor the dynamics of prices for this currency. Thus you will see a complete picture of the market.

It is also important to remember that you must be in a constant learning process. Find all the information that only you can get, about Forex. Do not focus only on what is available, look for things that do not know. View the forum, so you get lots of practical advice.

Once you're ready to join the game, think about the fact that no one becoming an rich overnight. In the beginning you have to extract information by all available means. Not all of your transactions are successful.

You also should avoid programs Forex country of origin. Their exists a huge set, and they all promise success. Check the names of the developers and their advice, before you purchase such a program.

The strategy of the "carry trade"

Forex traders for years have successfully used one of the most popular strategies that was online, "carry trade". However, the current state of the economy no longer speaks in favor of this strategy.

carry trade - is a strategy of trading currencies, when a trader intended to benefit not only from the increase or decrease rate of any currency pair, but also from the differential in interest rates this pair. Using this strategy, the trader gets the currency with the highest interest rate and simultaneously sell the currency to its lowest rate.

For example:

1. Trader buys the New Zealand dollar (earns 7%)

2. At the same time, the trader sells Japanese yen (paying 0.25%)

3. If the currency pair remains at the same level throughout the year, the trader earns 6.75% (interest rate differential). If leverage is 10:1, the trader earned $ 6,750 NZD.

But all good things come to an end, and carry trade - is no exception. Since most of the national economy is currently in danger, the government massively cut interest rates. So carry traders were forced to rethink their strategies (profit decreased from 8 to 6%).

Trading Philosophy

"Easy money" - the bait, which attracts many novice online Forex traders. Sites Forex offers trading without risk, highly profitable, small investments. Of course, these three statements are not devoid of truth, but the reality of Forex is more complicated.

New users in Forex make 2 main errors: trade without a strategy and let emotions guide their decisions. Eg. When you watch the dynamics of the currency pair EUR / USD, you may find that you lose a profitable opportunity, if you do not start bidding. You buy and see how market trends are beginning to turn against you. You panic and sell, and then trends in the market again, say in your favor. If you act this way, you're guaranteed to lose money.

In order to make a sequence of rational solutions, Forex trader needs to understand the dynamics of the market. He must know how to use different types of orders to minimize risk and maximize profits.

Management of funds - an integral part of any strategy. In addition to knowledge of currencies, Signals, a successful trader has to manage its resources and to integrate this skill into your trading plan.

Triangulation Currency

The primary importance of triangulation currencies is that many couples spot rates do not overlap in trading on the interbank market, as the standard pair. With the transformation of foreign exchange markets because of the advent of the euro currency, over time, new couples, such as EUR / JPY, GBP / CHF, GBP / JPY and EUR / GBP. The main companies, importers, exporters, governments, investors needed a method by which to both conduct business in euros, and earnings sent home in the national currency. Triangulation provides an opportunity to benefit from the spread in the interbank market.

Investors and traders can always find the difference between the spread of different currency pairs, which exist thanks to the introduction of the euro in forex and benefit from the.

Eg., Assume that we know the supply and demand for AUD / USD and NZD / USD and want to benefit from the AUD / NZD.
AUD / NZD demand = AUD / USD demand divided by the NZD / USD = proposal%

AUD / NZD proposal = AUD / USD on a proposal to divide the NZD / USD demand =%
The percentage that you receive, you will know whether there is in this case profits.
Triangulation allows you to benefit from the difference in exchange rates. This can be achieved in different ways. Translated Try these couples the CHF, EUR, GBP, JPY and US dollars from euros into your local currency.

Predict the future by studying the past

Technical analysis - the best and most accurate way to conduct trades in online Forex trading, known to all traders.

All information about any currency at any time and its implications for traders and the market is reflected in the price of the currency.In the Forex market is dominated by certain trends, and therefore the technical analysis as well as possible can be applied here.Experience in the trade industry confirmed that the story is repeated all the time, therefore, these graphs also follow a certain pattern and foresee ably melts.

The most important thing - to see them at the right time among the vast amount of data.

Prices follow trends, and traders who still have not noticed, do not use technical analysis, as, apparently, they do understand what is happening.

Years of research have shown that it is precisely those traders who are trading in accordance with the trends, are very successful.

You ask, what are the indicators to guide decision-making? On this issue you will not answer no.Technical indicators should be only part of your individual system.

Listen to the market, and it tells you what tool to use.

The issue of money and its results

Emissions - an instrument to which resort the central banks when they are no longer able to lower interest rates. This technique was applied by the central bank of Japan in 2001. The issue is the printing of currency to fill the financial markets currencies. The volume of currency in circulation increases, which reduces its value and leads to inflation.

With zero interest rates, the bank had to put into practice an entirely new level of policy to overcome deflation, which struck the national economy. Deflation - a significant drop in prices during a certain period of time. Inflation can have disastrous consequences for the economy, but deflation is no better. The reason for this phenomenon lies in the fact that the buyer is so reduces the costs that sellers have to lower prices.

In the first year of issue in Japan, the ratio of the dollar and the yen rose to 18,5%. This means that yen was much weaker against the dollar. Despite the negative experience of the Japanese government, the U.S. government has regularly resorted to the issue, which increases the risks for the dollar. So online forex trading is very sensitive to any economical or political news that occur in the world and the trader must be very open and must read to get all information that help him in trading.

Strategy: how to earn $ 2000 per week

How to interpret the news release. News went after the announcement of the major economic forecasts and sometimes can cause fluctuations in the 70 pip a few minutes in one currency.

Before you come out the main forex economic forecasts, the market is moving up or the opposite trend. At this time, traders try to profit from the price peak. Not all the news will speak in favor of this strategy. If you use it, you need to be trading on the market for about 5 minutes, and you will profit or bear small losses. To know the exact time of broadcast news, use the economic calendar in any online website or TV news like Bloomberg and CNBC.

News, after which usually applies this strategy - it is usually the main estimates for the U.S. EUR / USD, GBP / USD and USD / JPY; Europe, EUR / USD, EUR /GBP, EUR / JPY and EUR / USD; UK GBP / USD, EUR / GBP, GBP / JPY, Canada and New Zealand. Other news in this category: the unemployment rate of Canada and Australia, the economic sentiment in Germany, etc. Minimum generated by such news, is 30 pip 10 minutes. If you get a 20 pip profit for the event with a standard deposit, for 10 events in the week you can earn U.S. $ 2000.

Guide for beginners

Do not open new positions, if you lose the deal. Open them only if the transaction was profitable. Do not let bad deal to pull a whole series of lost trades. If the day was clearly a failure, turn off your computer. Often cessation of online trading on day helps stop a series of setbacks. If you try to win back, the situation can only deteriorate.

Keep an advantageous position open for as long as it leads to the forex market.

Quickly finish the deal, if you think you begin to lose. It will be better than waiting until the situation deteriorates. Do not assign too high a stop price, because you risk your money.

Find out when the opening match of different markets: at this time will be the highest volume of trades.Eg., For a couple of Australian dollar currency and Japanese yen currency this time will be from 8 pm to 1 night. At this time you can successfully sell the pair.

Select the correct day.

Select the correct day. It is well known and well-tested, which is not recommended to trade on Monday, when the market is just waking up and taking the first steps, forms, trends and on Friday afternoon, when most of the bidding stops. The most best days are Tuesday, Wednesday and Thursday.

Why should I trade in different periods of time?

Why not conduct trading on the Forex market at any given profitable segment? Why to choose periods of time?

Many novices start to trading on the Forex in any one chosen by them, the time interval. They develop their approach and begin to practice their skills. Sooner or later, traders are becoming an understandable that, despite all efforts, the results of their work can only be estimated as arbitrary, random: at one time, their strategy is working well, whereas in the other, when seemingly the same conditions, they are losing ... What happens?

One possible answer may lie in the limited research, ie if was investigated only one time period, and the trader does not know what is happening on the other, higher levels.

The greater the amount of time, the more important it is. Eg., The length of time of 5 minutes is more important than 1 minute. 1 o'clock is more important than 5 minutes. Day is more important than an hour. A week is more important than the day, etc.

The key for successful analysis of charts and diagrams in the online Forex market is in the habit of studying longer time intervals than those in which you are accustomed to trade. 2 more long segment just fit.More than two segments can overwhelm the trader's information.

Trading warrants

Market order - an order (order), which identifies the type of currency and the actions that need to be with her to make, for example. To sell or buy at current price. Market orders should be made at the most opportune moment, at the best price. In online Forex made a request to set the price of currencies, and after confirming dealer currency is bought or sold.

Limit order. This type of warrants gives instructions to the price for a profitable Forex trader than the existing market. This means that profitable for him purchase price must be lower than the current, and selling price of currencies - higher.

Limit order should not necessarily be executed. Only in the case, if there was a corresponding level of prices, the order will be executed, that is only to achieve a specified level of prices.

Stop-loss order should be made to achieve a certain level of market prices - the stop price. Stop-loss order will not be activated until the market does not install the stop price. At a time when it is achieved, the order goes into an active state and is executed at the best price. Stop-loss order is different from the limit orders in that price it is not defined exactly: it may be lower or higher than specified in the warrant.

Honest self

Taking responsibility for the results of their investment in yourself, you will realize that the most important factor in the success of online forex trading or investment in currency is just you. If you have already understood this, then you head and shoulders above all the other traders.

If you want to succeed, you must develop a method that suits you. Keep in mind that psychology is sometimes more important than the methodology. In fact, psychology should be a significant part of your methodology. Not to fixate on one thing, change direction.

Consider that blocks your path to success. This must be done at two levels. When you are composing a business plan, pay attention to introspection (introspection).Think about what you believe. This is useful beliefs or they may interfere with you? What are your strengths and weaknesses? You have to do a personal inventory each quarter.

The second level of self-esteem - self-assessment at the beginning of each day. What happens in your life? Are you ready to enter the market? As you a feel? No sabotaging whether what - that part youdiscipline? Or maybe you started to feel too self-confident? The most successful traders are always engaged in introspection, and if you want to earn, perhaps it's time for you to do the same.

Trade less, get more!

Trade currencies - it in first turn passion. How many people do you know who can not wait till Monday? Traders in the Forex market in this respect more fortunate. They mostly like what they are doing. But trade - this is the same and business. And the sad truth of business is: the more you bargain, the more you lose.

Of course, there are exceptions to this rule. Some traders can get a high enough profit from the frequent online trading (200 transactions per day by trading more than one currency). But they are not a lot. They can be called mad scientists, because they seem to have supernatural powers to predict the movement of prices. For the remaining deaths, fast trade - previously a losing game.

The reason is the high volatility. The more you enter the market, the greater the likelihood that you fall under the influence of some huge orders, and he pulls you along.

Of course, you can spin out the importance of discipline and patience, but we, poor simple people, hard to follow that advice. Therefore important to have a spare small deposit, which can be played without causing serious damage to your budget.

Objectivity

The most difficult lesson for all Forex traders: market exchange anything can happen at any time. Since traders spend much time studying the mechanisms of the market and focusing on the methods of forecasting currency movement, it is logical that they are looking for rules that govern the market. However, no such rules, and that the main trick.

Traders have many online tools can help you find the right time for the opening and closing trades and make good trading, but most have their favorite instrument, on which they rely most. And opening position, they are watching one indicator and base all their decisions on what shows this same indicator. All other indicators may indicate the opposite trend. As a result, the deal turns out to be unprofitable.

The problem is that in his mind a trader creates expectations and the market ceases to assess objectively. It uses a favorite indicator to reinforce this expectation, instead of stepping back. You need to learn not to fall into the two-digit positions. To do this you need to understand and accept that the market has its own line of conduct, rather than trying to turn the market as this would you.

Before the first auction

You do not help, no literature about online trading in the currency or forex markets, while you will not collect his forces and not risk their money. It's like a lottery: what would win, you at least buy a lottery ticket. And this is just the most difficult. And now comes the moment of truth: Can you act, despite the excitement and fear for their money? While you do not take your own for granted, and begin to trade, you do not become a successful trader.

Over time you learn to control your emotionalism. But be careful -- reverse reaction to anything good will not. You can become too self-confident and not focus your attention during on risks that sooner or later you will encounter.

Failure to start or finish their trades may be a trader for a serious psychological problem. If you pre-pay due attention to these potential problems, you will be able to prepare for your first bidding.

Start with introspection. Treat you to the type of people who are able to control their emotions and flawlessly carry trades in very stressful situations? Or maybe you take on more tasks than you can solve? Before your first sale, you must look inside themselves and answer these questions.

What is a lot?

Currencies in the Forex market are sold in lots. Standard lot size - 100 000 units. Units indicate the base currency, which traded.Eg., A pair USD / CHF is the main currency of the U.S. dollar. So, if you want to sell or buy a standard lot, its price will be $ 100 000. Another example: the pair GBP / USD. In this case, the primary currency is the British pound and the standard lot for a pair GBP / USD will reach £ 100 000.

There are 3 types of lots (depending on size):

Standard unit = 100 000 units;

Mini Lot = 10 000 units;

Micro lot = 1 000 units.

Mini and micro lots offered to traders who offer mini deposits (average of $ 200 to $ 1000). Standard lots are selling trader deposits are much larger (requirements for deposits of different sizes depending on the online broker).

We return to the lots. Trading standard lot (100 000 units), the trader risks losing (or is going to win) $ 10 per pip. The smaller the lot size, the smaller the profits, but losses will be less. When traders talk about losses, they also use the term "risk". After trading in Forex, you get the same chances: you either win or lose.

Forex Basics

Exchange rates - simultaneous transaction of one currency to another.

Currency market - a financial market that operates 24 hours a day. Currency market can not be called "market" in the traditional sense of the word, because he has no one central place for bidding. Most transactions are on the phone or via the Internet online.

Spot market - the market where the trading currencies at the current market price.

Rollover - transactions that occurred within 2 working days. If the currency with the higher rate is in your presence, you will get percentages. If you do not have enough currency with a higher rate before you pay interest.

Exchange. Price of one currency expressed by another. Eg. If the EUR / USD is 1.3200, then 1 Euro is worth US $ 1.3200.

Currency Pair - Two currencies that are venal course. If one of them bought, sold another and vice versa.

Base currency - currency, standing at first place in the currency pair.

Codes ISO.

USD - U.S. Dollar

EUR - Euro

JPY - Japanese Yen

GBP - British Pound

NZD - New Zealand Dollar

CAD - Canadian Dollar

AUD - Australian Dollar

CHF - Swiss Franc

Advantages and disadvantages of Forex

Advantages of Forex

High leverage. Since 500:1 Forex market offers traders a high leverage. This means that by investing a small amount of money, you can get great benefits by trading the currency you like.

No commission. In the Forex market does not have any form of commission.

Highest liquidity. A large number of currencies (7 major pairs of currencies), and international trade stipulate price stability, a slight decline, small spreads and high liquidity.

Profitability. In the Forex market is not organized prejudice exists, and all investors have the same chance to profit.

Forex is open and online 24 hours a day 5 days a week. You can enter the market when it is convenient to you.

Disadvantages of Forex.

High leverage. While high leverage one hand attracts traders in the market, it can provide constraints on the other. After high leverage linked high levels of risk.

Hour market. While traders are comfortable that the market is always open, it can also be a drawback Forex. Traders trading without the help of brokers, it is very difficult to track information on the market.This is where you need the professional broker. there are many brokers online. just choose the one that is regulated and famous.