Online Forex Trading Strategies

The advent of the internet and the onset of the recession has led to a greatly increased level of interest in FX online trading.New brokerage web sites are springing up all the time and it's difficult to decide which one to opt for.This article sets out 3 questions you must ask your broker before you open an account.

1. Are you an FCM (Futures Commission Merchant) broker or an ECN (Electronic Communication) broker?The reason for this question is this. FCM brokers very often have their own dealing rooms and often don't pass on their customers' trades to the actual FX market. They match one customer with another, or alternatively bet against them. With all their facilities and the ability to manipulate the prices on their system you can guess who stands the better chance of winning the trade.

ECN brokers don't have their own dealing rooms, but pass on all trades to the market, as they should. They therefore cannot bet against you, but simply collect the "spread", whether your trade is profitable or not. They also have no restrictions on trading or hedging, and tend to have the best prices and spreads.

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2. Where are you registered and how much is your capital?
Make sure that your broker is not registered in an offshore jurisdiction (you don't want problems if you decide to withdraw your money). He should be registered in the US, the UK, a major European country, Australia or Japan, with the appropriate regulating authority.

In the UK it's the Financial Services Authority and in the USA it's both the US Commodity Futures Trading Commission and the National Futures Association. Ensure the company's capital is at least $7 million (USD), or £5 million (GBP). Any less and there's a danger it could go bust and take your money with it.

3. Can I trade with covered warrants and ETFs (Exchange Traded Funds) as well as spread bets?Most brokers will direct you without even asking towards spread betting because that is the most profitable kind of account for them. But there are other methods of trading fx which can, once you master them (which is not difficult), be far more profitable for you.

When you make a spread bet on a currency pairing, for example the British pound and the US dollar (GBP/USD), there will be a "spread" that you have to overcome before you get into profit. This is how the broker makes his money (if he's not actively betting against you, as often happens).

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So, for example, as I write, the GBP/USD pair are trading at 1.5107. If your broker has a 3 point spread he may set his sell/buy prices at 1.5706/1.5709, so you can go long (buy) at 1.5709, but the price would have to move up 3 points to 1.5710 (i.e. 1.5709/1.5712 at your broker) before you would be at "break even" point. The same applies in reverse if you chose to sell, or go short. You are always at a disadvantage compared to the market or your broker.

This, coupled with absurdly low "stop loss" levels, makes it almost inevitable that the new trader will lose all his money before long. The low amount of capital required by most brokers to open an account, which is pushed as being generous on their part, enabling the "ordinary Joe" to "open a currency trading account and start profiting", actually works against you.

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If you have only a small amount of capital in your account then, unless you are going to risk nearly all of it on each trade (in which case you are doomed to lose all your money even more quickly than normal) you are going to have to trade with tight stop loss levels.

In the volatile fx market, where prices move erratically and seldom go up or down in a straight line, this is crazy. The few successful traders in this market employ large stop loss levels, even on trades they are very sure about. This enables them to ride the volatility of the market.

The only practical solution to this anomaly is to avoid spread betting altogether, and use instead covered warrants and Exchange Traded Funds. Hence this question. You may, however, have to go further than your broker in order to learn how to trade these instruments. But the information is there, if you look.

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How NOT To Do a Forex Demo

I opened up my first Forex demo account with the intention of making a fortune by trading in the Forex market. It is a given that before you attempt to trade, you should open a demo account, and I am grateful that I had the intelligence to at least do that before I started live trading.

I had seen ads for a large Forex broker, and because they seemed to be well-known and popular, I decided to go to that broker's website and apply for my Forex demo account. The application process took only a very few minutes, and after confirming my e-mail address, I was on my way, or so I thought.

When I finally got the trading platform downloaded and installed, and opened it up for the first time, I was confronted with a dazzling array of numbers, currency symbols and tables that were very unfamiliar. I did see that there were charts available, and since I had some experience with charts in the stock market, I decided to start there.

I opened a few charts for what I later learned were some of the major currency pairs, and even found some indicators that I was familiar with. I applied a few indicators, and played around with the charts until I had a very impressive looking screen in front of me.

I returned to the main trading screen, and proceeded to watch the prices change quite rapidly before my eyes. It all got more and more intimidating, and I never got much beyond that point. I think that I bought 1 lot of a currency pair, and watched the prices move for a few minutes, and then sold it again (for a loss). But other than that, I didn't do anything else with my Forex demo at that time.

The problem is, I had gone about the whole thing backwards. There really is no sense in opening up a Forex demo account unless you have a system that you are intending to trade, and that you want to test and practice with before you start live trading. You have to have a plan, which means a system that you intend to follow, to determine four things:

What currency pairs you will trade.
When to buy.
How much to buy.
When to sell.

Unless you know the answer to those 4 questions, a demo account is going to be nothing more than a very intimidating screen full of currency pairs and moving prices.It wasn't until about a year later that I found a system that made sense to me, and finally opened a demo account that I would really use. And when I opened up the trading platform this time, I knew exactly what I was going to do, because my system answered those 4 key questions for me.

Now, I am happy to say that Forex trading is a big part of my life. I have since started a newsletter and blog, in which I share the system I use with anyone who is interested in learning this amazing way of making money. I encourage you to learn how to trade the Forex market. But I hope you will start a little more intelligently than I did, and that means, starting with a system!

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Forex Trading Platforms - Advantages of Forex Investing

Do you know the advantages of the forex market compared to other types of investments?Here's a little taste of the advantages associated with this type of investment vehicle.There are no major holds on your money like there are with other investment vehicles.To trade in the forex market, you don't need a lot of money to start investing.

You can get into the forex market with sums as low as Three Hundred Dollars (USD). This is known as what's called a "mini account".The forex market is also very liquid. In fact, you have total control of your money.The forex or foreign currency market is open twenty four - seven (24 hours per day), whereas the stock markets as most people know it are not.


Forex traders can be profitable in all types of markets (bear or bull). Forex traders can make a profit during up trends and downtrends. That won't happen with your typical stock market investing.Forex Trading can be risky UNLESS have a good system to follow, good money management skills, and strong self discipline.

If that sounds like you, then Forex trading can be a relatively low risk investment.This market can be traded at anytime during the day or night (remember it's 24/7). All you need is access to a computer and you'll have the ability to trade.

Don't forget to practice with "fake money." Most brokers have demo accounts where you can download their trading station and practice real time with fake money. This obviously is no guarantee of how you'll perform with the real thing, but it can give you quite the advantage when it comes time for you to trade with YOUR real money.

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Understanding Forex Capital Markets

The Forex Capital Market in the foreign exchange arena worldwide is a nonstop,no nonsense cash market. The different currencies of nations are traded here for profit and the transactions are typically taken care of by dedicated brokers. Foreign currencies in the Forex Capital Market worldwide are consistently bought and sold.

This buying and selling of currencies takes place across local and global markets. The overall exercise is to ensure that the investments of the traders involved increase in value. These profits are in turn generated by the currency movements. The conditions in the Forex capital market arena are subject to change at any time and are substantially influenced by a number of real time economic news and events.

The main attraction of this market for retail traders includes 24x7 trading and nonstop access to the global Forex dealers. You can literally trade at any time of the day!The currency markets worldwide are enormously liquid and this nature of the market makes it easy to trade the major currencies (U.S. Dollar, Euro, Swiss Franc, Japanese Yen and British Pound).

This highly volatile and liquid market offers investors a number of profit raking opportunities.A trader's ability to quickly profit with the rising or falling of prices is what lures the industry big players to keep earning and investing regularly.The market offers foreign exchange trading within a leveraged arena, with low margin requirements. The market also offers investors and traders ample of options to benfit from with zero commission trading.

The currency market deals with sensitive capitl investments from all over the world, and aims to profit from volatile foreign currency movements around the globe. Forex trading within the dedicated market is always conducted in currency pairs. The numbers are referred to as foreign exchange rates and investors need to understand how to interpret its values.For example, the rate of EUR/USD = 1.4000 means that one Euro can be traded with 1.4000 U.S. Dollars.

The lucrative trading opportunities from all over the world enable the investor to enjoy the benefits of a high return on investment in the Forex market. Compared to other forms of trading, currency trading can potentially yield a 30% return (or more) within a very short time period. Also, compared to a stock which may be worth absolutely nothing in the case of a bankruptcy, it is highly unlikely that a currency can be completely worthless.

When trading currencies in this unique market, traders deal only when the currency being bought is expected to increase in value as compared to the currency being sold. This financial rostrum also flaunts scope for open trades or open positions, where the trader buys or sells a particular currency pair, but does not transact the equivalent amount to close the position.

The arena is very speculative in nature. The currencies in are traded in pairs and exchanged one against the other and exchange rates are mostly determined against the US dollar (USD). This financial market works along the determined minimum security that is intended to cover trading losses and the margin enables private investors totrade in high minimum units and enhanced rates of profit.

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Trading Currencies - Forex Breakout Strategy

The Breakout Strategy is one of the most commonly used by professional and successful traders. Even though it is used by professionals, it is really simple to implement using regularly updated technical charts which are readily available online.Breakouts in the forex market occur anytime that a price breaks above or below a resistance or support point.These points are determined by technical analysis and anyone can find what the technical points are on charts online.

Sometimes I use the free technical charts available to all So, for example, let's say most recent technical chart on the the EUR/USD gives the following information: S1: 1.3609 S2: 1.3584 S3: 1.3560, and R1: 1.3657 R2: 1.3682 and R3: 1.3706. This means that S1 is the current first level of support for the EUR/USD and the last time the EUR/USD tested S1, enough buying occured that it did not fall any further.

If the EUR/USD falls through S1, then S2 is the next level of support, and finally S3is the third level of support.Likewise, R1 would indicate the first level of resistance through which it may be unlikely for the EUR/USD to be able to break above. If EUR/USD does break above R1, then R2 is the next level of resistance, and R3 is the third level.

Now that you fully understand the basics and the simplicity of reviewing the technical chart. It is easy to spot a breakout trading opportunity. When the price of a currency pair breaks below a support point or breaks above a resistance point, a high probability trade in the continued direction of the breakout may be executed. (If the currency pair breaks through a support point, then go short/place a sell order on that pair.

If the currency pair breaks above a resistance point, then go long/place a buy order on that pair.)The trick here is to enter the trade as soon as you possibly can after the breakout occurs.If you wait too long, you could miss the major move and actually enter too late, possibly even so late that the trade reverses for a loss. If you enter the trade and set a reasonable stop profit.

You will minimize your loss potential while setting yourself up to collect the big pip movements that are often associated with currency pair breakouts.Now obviously, a full breakout does not occur every time a currency pair breaks above or below a technical point. Sometimes it leaps above or below the technical point briefly and then pulls back.


Such incidents are often referred to as "false breakouts."

However, catching the trend on a true breakout is worth losing some pips on all the false breaks the trader has to take when using this strategy. Hundreds of pips can be gained when a trader enters a trade at the beginning of a true breakout. So by setting your stops correctly, you should not lose too many pips on false breaks, and you may even be able to grab a small profit even on a false breakout.

When you catch a true breakout, however, you could very well gain hundreds and maybe even 2 hundred pips. When this happens you can set a trailing stop and let the trade continue to run at no risk with your profits "locked in." The first time a trader catches a true breakout with great momentum behind it, the trader will definitely recognize the power and simplicity of the breakout startegy and will realize that all of the small losses on false breaks were well worth it!

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Global Forex Trading

Forex is one of the greatest hommy work opportunity to make money. It gives an opportunity to make money from the comfort of your home and spending the time with family at the same time. It is also an opportunity which you can do along with your existing day job. Forex means foreign exchange and Forex trading means is the trading between foreign exchanges.

Forex trading requires some knowledge about the way the Forex market runs. You have to learn about he factors both local and the global which affects the market. If you want to succeed in this particular trading you must have the knowledge about the basics and facts. Global Forex Trading offers the chance to deal in real time online currency trading that makes millions of forex brokers become more rich every day.

Global Forex Trading has less publicity that stock and commodities market and even the futures, even more than $2 trillion of currencies are transacted every day on the global forex market.Compared to stocks and shares or commodity markets that have specific opening and ending trading times. At the same tim, Forex markets are available for trading anytime with price of currencies changes and fluctuates everytime.

Forex trading has become an extremely popular way to trade the global market, the largest and most liquid market in the world.The Forex Trading market is open 24 hours a day. Forex trading also gives free commission and available on more than 60 currencies worldwide.Global forex trading boasts that they provide the only forex trading platform that is suitable for both beginners and professionals.

Forex Trading has no restrictions of getting profits no matter what the market condition. Nowday, the Global Forex Trading is available not only for the large investors but the smaller one can take a part too.Leverage is the main key and powerful tool to Forex Trading wealth.You should have a good education in Forex trading to reach gain and profits consistently.

In Forex trading, you can get a leverage of 20 to 50 times commonly up to 100% margin in some special cases. In stocks or shares, you may be able to get it of 50 – 70% of your stocks or shares.Leverage is the main key and powerful tool to Forex Trading wealth. You should have a good education in Forex trading to reach gain and profits consistently. With that leverage comparison, you may be able become a millionaire fastest in Forex trading.

All things you need to know and learn it up in Forex trading ; knowing risk level - how much you are willing to lose, understanding the different forex trading systems as technical and fundamental and research the trading systems which you can be familiar with how they work.Also learning the trading trends, price history, support and resistance lines, familiar with the fundamental economic factors and its issues that effect to the Forex market.

Global forex trading is something not many people consider for investment – because of less information - but worldwide forex trading continues and become more and more popular recently. Individuals all over the world are investing in the Forex market and gaining thousands of dollars every day.

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How to Use a Forex Demo Account

Forex traders and investors are using Forex Demo Account method to decide if forex trading is appropriate for them. A demo account allows concerned people to go online and see how an account will work without any risk of investment and money. Investors can have money in their account and buy or sell in the same way will be done in truth.

The software used is very accurate, and most people can see at the end of the day, if they lose or gain money transaction the same as the truth. Investors have a margin account with ten thousand dollars in it. We see the current markets and believes that the dollar will rise against the yen. It enables us to buy the ten to one margin, so we buy (in the program) one hundred thousand dollars and sells one hundred thousand dollars of dollars of yen.

A demo account allows one always safer to learn how to do things without the risk of this kind of money actually.Forex demo account is also a valuable tool for those who want to improve and learn forex trading strategies without risking any money. It is an important step on the road to forex profits. We can make each trade as the real. Forex demo account is an excellent tool for learning money management.

For that, there are some important things to keep in mind, about forex account namely :1. It is usually provided free of charge to potential clients by forex brokers.Account does not contain the funds but the actual "virtual funds" 2. It is very valuable for beginners to the investment world. Having forex demo account we learn to invest perfectly 3.

The best way to practice technical analysis is by using it. There are only small differences between technical analysis and the real account on the demo stage, and we can learn a lot 4. It is important to learn about many aspects of software, forex trading systems and more. Free demo forex account we can use for training purposes at any time without obligation.

We must have an account forex demo, we have to go through the easy registration by doing the following: start dealingdesk-2000tm, go register for the demo, in which we are asked to indicate the log-in name and password which we will use to access to dealingdesk -2000tm during the demo period. In the same way as the general forex demo, free account also competitive. But this way you will have one more advantage - participation in the competition that will provide the opportunity to win real money to your account in forex.

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Introduction to Forex

Do you know Forex? If the answer is 'No' then you should go through this article to get a brief idea about Forex. Forex trading can help you to earn lot of money. “Forex” is the short form of Forex Exchange. Sometimes, it is also referred as “Spot FX” market; it has become a full time job for many people. Forex market is considered one of the biggest markets in the whole world.

If you are a Forex trader, you will buy and sell world currencies, thus earning profit from the difference, between the exchange rates. Forex trading can definitely yield high profits. Anyone can do Forex trading via Forex brokers. Forex market mainly consists of currency traders that speculate on fluctuations in exchange rates. Currency traders take advantage of even the slightest fluctuation in exchange rates.

Currencies are always traded with one another. Each and every pair of currencies constitute a product and is noted XXX/YYY. Here YYY is a currency that is always expressed in XXX currency. In addition, XXX and YYY are 3-letter international codes of the respective currencies. For instance, EUR/USD means euro expressed in US dollar, as 1 Euro= 1.2045 dollar. Exchange rate fluctuations are caused by monetary flows and anticipations on global economic conditions.

This market operates 24 hrs a day and 7 days a week between the brokers with banks, individuals with Forex brokers. Investing in Forex market is a better option than other kinds of investments.Unlike regular stock markets, Forex is open 24 hours a day. To do Forex trading, you do not need large amount of capital. With a small amount of $300 USD, you can enter the Forex market and open a “mini account” which will allow you trade lot of units.

Forex market has high liquidity. In Forex trading, you have complete control over your capital. Most investments hold your money for a long time. This is a major disadvantage because you cannot use this money in case of financial difficulty. If somehow you access this capital, you will have to suffer huge loss, which is not feasible.

Forex traders can earn profit even in unfavorable market conditions. Stock market traders cannot get profit unless the stock prices increase. Forex traders can make profit during down trends and uptrends.Forex trading can be risky but if you possess self-discipline and good management skills then Forex trading can relatively be a low risk investment.

Trading in Forex market can be done anytime, anywhere if you have access to a computer. Before you start trading currencies, you are advised to practice with “fake money” or “paper money”.Most Forex brokers have their own demo accounts from where you can easily download their trading stations and then practice real time trading with paper money. By doing this, you will be better prepared to trade with your hard earned money.

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