The main advantages is that you have the ability to have instant execution of your orders. All of the orders that are placed on GFX, which is a type of forex software, are actually executed immediately by the online services. The traders are also able to place stops as well as limits on any position that is open or the trader can have them pre set on the orders of the market. Another advantage is the optimum compatibility and also the performance. You should know that Global Trader doesn’t take but a second to download and it is easy to install as well. You will see that it will perform without one flaw on the operating system that is known as Windows. You should also consider that the Global Trader’s programming design that is advanced is also known for minimizes the actual use of your individual systems resources as well. Another advantage that you will have is that you will have a window that is customizable for trading. You will be able to add all of the currencies as well as the metals that you want to trade and you will also be able to view live prices for those currencies as well. You will be able to choose from thirty three currency pairs as well as four spot metals.
source:4x-tradings.blogspot.com/2009/09/advantages-of-forex-trading-software.html
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Thursday, October 22, 2009
Saturday, October 10, 2009
SO WHAT IS THIS WORTH TO YOU…?
The ultimate Forex siphoning monster which will turn you into a profit machine within minutes…
I guess you could say that it’s pretty priceless!
The ultimate Forex robot, the only one that incorporates every angle “known” to the professionals, with every bit of automated advanced software totally covered. Every dollar they have made, you can make… within a few days!
So, if my competition charge $300 and up for outdated systems and robots, how much should I charge? How about $400? $500 even…?
Hell, I’ve even seen ‘gurus’ successfully sell seminars at over $10,000 per head that teach people to make far less money than Forex Decimator can make you.
So should $10,000 dollars be the starting point for me then…?
It wouldn’t be such a bad price considering your future gains.
Perhaps though that would price a fair few people out of the market. I don’t want to do that.
Think though about what it would mean for you to be able to fire up Forex trading with the absolute knowledge that your software will bring you in profits from day one.
Think about how it feels to go from zero to hero with thousands of dollars in your bank account in just a few weeks. What price would you attach to paying off all your debts and giving your family the support they deserve?
There is no doubt that I could sell this software for $500 – and there would be enough smart people out there to realise that they would make their money back within days.
Remember that much of my competition charge $100-400 for inferior software…
So…
If you think I’m going to charge $200, guess again… $150?
Well I have a big shock for you – the price is not what you think…
Over the last few years, we have invested literally thousands of hours and dollars perfecting this software, and when you consider how much you have already spent chasing your dream of success, you will quite clearly see what a saving this represents.
Not only will you be getting this fantastic product but it is also totally risk free for 60 days. There is only one decision you can possibly make.
I have been fortunate to become a wealthy man through Forex trading and I WANT to make this software readily available to anybody who has the balls to reach out and grab this fantastic opportunity NOW!
And that is why I have decided to make the first 200 copies only available for a pitiful $97.
ACT NOW OR MISS OUT!!!
Because once the first 200 copies are sold, and they will be very quickly, we will be putting the price back up to RRP of $247. And to ensure that our customers continue to receive the very best customer service, we will be stopping sales when 500 copies have been sold.
ACT FAST TO RECEIVE THIS REVOLUTIONARY SOFTWARE FOR:
● NOT $10,000
● NOT $500
● NOT EVEN $147
● BUT FOR THE INCREDIBLE PRICE OF $97
source:.forexdecimator.com/?hop=lakshmis&gclid=CKi0t4D9sZ0CFQkwpAodDiEDiQ
af781adc-1909-45be-9e04-51510a79021c 9 0 The world−wide recovery continues, but will lose momentum early next year
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Upward. The global economy is clearly back on a growth path. Real GDP in the US as well as in Germany should even have posted strong growth in the past quarter. But we also expect the rest of Europe to have grown again for the first time since the beginning of 2008. The tangible recovery also looks set to continue in the current quarter. Thereafter, however, the momentum should slow appreciably. We do not, however, expect a renewed slide into recession.
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US. But in spring 2010, the US economy will merely stagnate. This gels with the fact that leading economic indicators have already lost momentum over recent weeks. While most are still posting respectable gains, their growth rates are already slowing appreciably (pages 3-5 & chart below). Strains are resulting from the end of fiscal stimulus programs.
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Europe. Leading indicators in Europe should continue to trend higher for somewhat longer, driven by the ongoing upswing in the industrial sector, since inventories still have to be replenished. Once, however, the global economy loses momentum again at the beginning of 2010, EMU-wide growth should also slow – not least because investment will remain weak for a lengthy period and jobs will continue to be lost (pages 6-7).
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Central banks. The central banks are, therefore, not in any rush to reverse their highly expansionary monetary policy quickly. This was also the message of the ECB at its press conference yesterday. Similar signals are coming from the Fed.
-
Further topics:
– Weekly Comment: Bluff (page 2).– Commodities: Only temporary relief on the oil market (page 8).
– Data outlook: ZEW growth expectations appear to have peaked; US retail sales in reverse gear (page 11).
– Market outlook: EUR in demand, govies tending higher (page 18).
Bluff
In a relevantly uneventful press conference, Trichet came under pressure on two issues: FX developments, and the situation in the European financial system in the light of the September Long-Term Refinancing Operation. On FX, he tried to signal that there is serious international commitment to limit further EUR-USD upside – but markets will quickly call the bluff. Coordinated intervention is clearly not in the cards, and without it the ECB has run out of ammunition on the FX front. Trichet was cautiously optimistic that the reduced demand at the September LTRO signals ongoing normalization, but steered clear of commenting on what kind of banks are still using the auction – there is dichotomy emerging in the eurozone banking system here, and it could become a serious headache for the ECB. Overall, I see clear confirmation of our view that the ECB is in no hurry to walk to the exit and will continue to ask government to exit first, while keeping the refi rate on hold for at least another year.
On FX, Trichet tried to signal as convincingly as possible that the eurozone and the US are united in their desire to limit further upward moves in EUR-USD – but it sounded like a bluff, and the market will quickly call it. In particular, Trichet intimated that the US is not currently adopting a benign neglect policy (“our currency, your problem”), and that global policymakers would “monitor and coordinate” as needed, united in their belief that disorderly exchange rate movements should be avoided. Asked whether such coordination might include joint interventions, Trichet noted he never comments on FX intervention issues – but was probably not displeased at the question. More significant, however, is what Trichet did not say: he did not express concern that the ongoing appreciation of the EUR might pose a threat to the recovery.
The problem, as I have highlighted in previous notes, is that the G20 cannot square the circle of pushing for a reduction in global imbalances while avoiding further USD weakness. The question therefore becomes once again how to divide the burden of appreciation, and here only China can lighten the euro’s burden. As long as markets remain skeptical of a possible coordinated intervention, which at this stage would probably need China’s implicit blessing, there is nothing the ECB can do. With short-term market rates near zero and an inflation target to safeguard down the line, the ECB really has run out of ammunition on this front. We continue to target EUR-USD at 1.55 by the middle of next year.
Trichet expressed some cautious satisfaction on the result of the September LTRO: he noted that most observers see the reduced demand for liquidity as a sign of normalization, but said it was too early to draw conclusions. More significantly, he declined twice to comment on possible identifying characteristics of the banks participating in the auction. My colleague Aurelio Maccario has highlighted in previous notes that there is a clear dichotomy emerging in the eurozone’s financial system, with more solid institutions regaining access to other providers of liquidity like money market funds, and others left with the ECB as their one and only source of funding. I believe this will remain an extremely important issue in the coming months and possibly quarters, and might well become one of the ECB’s worst headaches. Trichet emphasized once again that banks need to do their part to help the economic recovery, and once again exhorted them to strengthen their capital base, if necessary availing themselves of governmentprovided instruments. This time, however, he also noted as very encouraging the recent efforts by a number of eurozone banks to raise additional capital on the private market. The ECB is treading a fine line here, where caution sometimes clashes with clarity: on the one hand, it urges banks to raise more capital, while on the other hand it says that the results of its own stress testing exercise show that the systemically important banks already have sufficient capital to withstand even a very adverse risk scenario.
On lending, Trichet’s tone was very balanced: he noted that the ongoing deceleration in lending to non-financial corporations was in line with the usual delayed response to an economic slowdown, so that further deceleration in lending could be expected in the coming months even though economic activity has stabilized. He also noted, however, that in a recent ECB survey of small and medium enterprises, nearly 80% of respondents reported a positive attitude from their lenders in response to credit requests. This confirms that there is as yet no evidence of a credit crunch, even though the risk of a credit squeeze needs to be monitored.
Inflation expectations were another hot topic, and Trichet was asked whether the recent rise in 5Y5Y forward measures was a concern: he played it down, stressing that considering both market and survey measures, the overall conclusion was that inflation expectations remain well anchored and in line with the bank’s target.
Overall, this confirms our view that monetary conditions will remain accommodative for quite some time, with the ECB looking for signs of reduced liquidity demand to provide some automatic unwinding before it even considers walking towards the exit. We expect short-term market rates to remain very low for the remainder of the year and to normalize only gradually in 2010, with the refi still on hold for the next 12 months.source:fxstreet.com/fundamental/analysis-reports/friday-notes/2009-10-09.html
How To Be Successful Forex Trading
Today there are many people in the world that are using Forex to make money. Forex trading is buying and selling currencies to make profit from it. It can be a great money making business if you can do it right. It is the type of business that you can make thousands of Dollars each month if it is done correctly.There are some major advantages to Forex Trading.* The long hours that the forex market is open, it trades 24 hours a day for 6 days per week and is the most liquid market in the world. So even if you have a full time job you can still come home and trade. It is a great way to start out, paper trade build up confidence start achieving financial success then you can leave your current job.* It doesn't matter what the market is doing as you can just as easy go long (buy currency) or go short (sell currency) so there is never a bad time unlike buying stocks. The liquidity means that you have no problem selling.* You don't need thousands to start. The reason that you don't need massive bank balance is because you can use leverage, in some cases you can get 400:1 so if you have $1000 you can leverage that into $400,000, which can make for great profits. Also you don't pay brokerage or commissions. If you are looking for a great Forex Broker feel free to visit us and we can show you the best forex brokers in the markets.* The market will never go broke. Unlike share trading where companies can collapse it is very unlikely to happen in Forex. Imagine if the USD was worth $0, so you can see very unlikely.* If you are new to the foreign exchange market, you do not have to worry about spending thousands of dollars to learn or buy a course. There is online forex trading course that will explain how the forex market works and a forex tutorial will also explain about fundamental and technical strategies that are available to you as a forex trader.* Work your own hours if you don't feel like trading then you don't have to, it will always be open tomorrow.* To learn Forex Trading is very simple today all you need is a computer and forex broker* To ensure that you can become successful in Forex Trading make sure that you get some education, as knowledge is power. You can start out learning online or through books it doesn't have to be through expensive course.
source:janbaz-forex.blogspot.com/
source:janbaz-forex.blogspot.com/
Forex - What is it?
The international currency market Forex is a special kind of the world financial market. Trader’s purpose on the Forex to get profit as the result of foreign currencies purchase and sale. The exchange rates of all currencies being in the market turnover are permanently changing under the action of the demand and supply alteration. The latter is a strong subject to the influence of any important for the human society event in the sphere of economy, politics and nature. Consequently current prices of foreign currencies evaluated for instance in the US dollars fluctuate towards its higher and lower meanings. Using these fluctuations in accordance with a known principle “buy cheaper – sell higher” traders obtain gains. Forex is different in compare to all other sectors of the world financial system thanks to his heightened sensibility to a large and continuously changing number of factors, accessibility to all individual and corporative traders, exclusively high trade turnover which creates an ensured liquidity of traded currencies and the round - the clock business hours which enable traders to deal after normal hours or during national holidays in their country finding markets abroad open.Just as on any other market the trading on Forex, along with an exclusively high potential profitability, is essentially risk - bearing one. It is possible to gain a success on it only after a certain training including a familiarization with the structure and kinds of Forex, the principles of currencies price formation, the factors affecting prices alterations and trading risks levels, sources of the information necessary to account all those factors, techniques of the analysis and prediction of the market movements as well as with the trading tools and rules. An important role in the process of the preparation for the trading on Forex belongs to the demotrading (that is to trade using a demo-account with some virtual money), which allows to testify all the theoretical knowledge and to obtain a required minimum of the trade experience not being subjected to a material damage.
source:janbaz-forex.blogspot.com/
source:janbaz-forex.blogspot.com/
Forex Revelent Informations
Here are some of the most common terms used in FOREX trading.Ask Price ¨C Sometimes called the Offer Price, this is the market price for traders to buy currencies. Ask Prices are shown on the right side of a quote ¨C e.g. EUR/USD 1.1965 / 68 ¨C means that one euro can be bought for 1.1968 UD dollars.Bar Chart ¨C A type of chart used in Technical Analysis. Each time division on the chart is displayed as a vertical bar which show the following information ¨C the top of the bar is the high price, the bottom of the bar is the low price, the horizontal line on the left of the bar shows the opening price and the horizontal line on the right of bar shows the closing price.Base Currency ¨C is the first currency in a currency pair. A quote shows how much the base currency is worth in the quote (second) currency. For example, in the quote - USD/JPY 112.13 ¨C US dollars are the base currency, with 1 US dollar being worth 112.13 Japanese yen.Bid Price ¨C is the price a trader can sell currencies. The Bid Price is shown on the left side of a quote - e.g. EUR/USD 1.1965 / 68 ¨C means that one euro can be sold for 1.1965 UD dollars.Bid/Ask Spread ¨C is the difference between the bid price and the ask price in any currency quotation. The spread represents the broker's fee, and varies from broker to broker.Broker ¨C the intermediary between buyer and seller. Most FOREX brokers are associated with large financial institutions and earn money by setting a spread between bid and ask prices.Candlestick Chart - A type of chart used in Technical Analysis. Each time division on the chart is displayed as a candlestick ¨C a red or green vertical bar with extensions above and below the candlestick body. The top of the extension shows the highest price for the chart division and the bottom of the extension shows the lowest price. Red candlesticks indicate a lower closing price than opening price, and green candlesticks indicate the price is rising.Cross Currency ¨C A currency pair that does not include US dollars ¨C e.g. EUR/GBP.Currency Pair ¨C Two currencies involved in a FOREX transaction ¨C e.g. EUR/USD.Economic Indicator ¨C A statistical report issued by governments or academic institutions indicating economic conditions within a country.First In First Out (FIFO) ¨C refers to the order open orders are liquidated. The first orders to be liquidated are the first that were opened.Foreign Exchange (FOREX, FX) ¨C Simultaneously buying one currency and selling another.Fundamental Analysis ¨C Analysis of political and economic conditions that can affect currency prices.Leverage or Margin ¨C The ratio of the value of a transaction to the required deposit. A common margin for FOREX trading is 100:1 ¨C you can trade currency worth 100 times the amount of your deposit.Limit Order ¨C An order to buy or sell when the price reaches a specified level.Lot ¨C The size of a FOREX transaction. Standard lots are worth about 100,000 US dollars.Major Currency ¨C The euro, German mark, Swiss franc, British pound, and the Japanese yen are the major currencies.Minor Currency ¨C The Canadian dollar, the Australian dollar, and the New Zealand dollar are the minor currencies.One Cancels the Other (OCO) ¨C Two orders placed simultaneously with instructions to cancel the second order on execution of the first.Open Position ¨C An active trade that has not been closed.Pips or Points ¨C The smallest unit a currency can be traded in.Quote Currency ¨C The second currency in a currency pair. In the currency pair USD/EUR the euro is the quote currency.Rollover ¨C Extending the settlement time of spot deals to the current delivery date. The cost of rollover is calculated using swap points based on interest rate differentials.Technical Analysis ¨C Analysis of historical market data to predict future movements in the market.Tick ¨C The minimum change in price.Transaction Cost ¨C The cost of a FOREX transaction ¨C typically the spread between bid and ask prices.Volatility ¨C A statistical measure indicating the tendency of sharp price movements within a period of time.
source:janbaz-forex.blogspot.com/
source:janbaz-forex.blogspot.com/
Friday, October 9, 2009
Achieving Trading Perfection
Achieving Trading Perfection - Trade quality, not quantity. Take the best of the best. Get the big picture. If you haven’t previously come across such advice, or if you have and are not following it, it is time that you take these words to heart. But how?
Trade selection and adequate planning go hand in hand. This is where most would-be professional traders miss the boat.
Much more money is made as a result of proper planning than from sitting and trading everything that comes along or "looks" good.
It’s difficult to fully understand why people think they have to trade so much. It’s difficult to truly grasp why people think that they have to take as many trades as they do.
Just the opposite is true. There is a correct approach to each and every trade. That is what achieving perfection is all about.
It all starts with proper management: planning, organizing, delegating, directing, and controlling.
These facets of management must be woven together into your trading; they do overlap.
Although planning is the major management function involved in achieving perfection, you can’t possibly plan well unless you are organized to do so.
You must have your tools at hand: your trading software, your data, the proper equipment. All of the rudiments for planning must be in place, which in itself is a part of organizing.
You must be physically fit when you plan: well nourished, properly exercised, well rested and mentally alert - all part of having your life organized, all part of achieving perfection as a trader.
To be a winning trader, you have to be among the best. There can be no middle ground. There are only winners and losers, and to be a winner you have to be a champion. And, just like any champion, you must have discipline, self-control, and a willingness to train, train, train.
There are no runners-up in trading, you either get the gold or you give the gold. Often, while others are busy going to parties or watching sports events, you are busy poring over charts, studying, thinking, planning. When others are listening to music or watching TV, you are busy practicing your trading, practicing trade selection, working hard to become a more astute trader.
Part of achieving perfection involves the diligent study of charts. The data, as presented on your screen and preserved as charts, are, for the most part, all you have for making trading decisions. They are a picture, a visualization of what is taking place in the reality of the market. Your job in achieving perfection and becoming an adequate trader is to picture and imagine in your mind what makes prices move and form the way they do. Ask yourself, "How does what I see in front of me relate to the supply and demand for the underlying?" Ask yourself, "Is what I am seeing on the chart even related to supply and demand, or is what I am seeing related to an engineered move by some insider or market mover?"
Supply and demand are not what makes prices move or fail to move most of the time. The sooner you realize that fact, the better off you will be. Markets are engineered, manipulated ¾ you need to know that.
But there’s more to a chart than merely price patterns. Reflected in the chart are the emotional reactions of human beings. Reactions to rumors and news; to national and world events; to government reports - these, too, are on the charts.
You might say that price movement, or the lack thereof, is the net effect of all the perceptions of all the traders who are participating in the market for a particular futures.
There is something else on the charts, something that too few take into account. That something is the manipulations from and by the insiders, the market movers, and by commercials holding large inventories of the underlying you are attempting to trade.
In achieving perfection as a trader, you must train yourself to look for evidence of any and all of these things as you study your charts. It is the cumulative action of all perceptions which causes patterns to form on a price chart.
You must learn to look for the truths in the markets. There are certain truths which are self-evident; they are always true. For instance, take the phenomenon of a breakout. When prices break out, no one can change the fact that they did break out. It is a fact and it is true. The breakout may turn out to be a "false" breakout, but nevertheless it is a breakout. As part of achieving perfection in your trade selection skills, you have to learn to tell which breakouts are most likely true breakouts, and which ones are most likely false. How can you know? By the price patterns on the chart.
And what about trend? Your job in achieving perfection as a trader is to master how to trade a trend. A trend is a trend, is a trend. It is a trend until the end, and part of your job is to know when a market is not trending.
The trend is the trend while it lasts. While a market is trending it is telling the truth. The trend can change, but the truth is the truth. If prices are rising, the trend is up. If prices are falling, the trend is down. The truth can be found in the trend. It is an immutable fact. You are to learn to make my money by trading with the trend. You are to learn what constitutes a trend. You have to learn to spot trends early so that you can make the most out of the market while it is trending. Your job in achieving perfection as a trader is to learn to recognize when a trend will most likely begin, and just as important, to learn to be even more adept at deciphering when a trend is ending.
In achieving perfection, you must learn to recognize "your" trade(s), and to take only "your" trades. Trade the formations and patterns that you can easily recognize and identify.
You must learn to trade using tips and tricks that you are shown and to accumulate and keep a collection of techniques that result in the selection of high probability trades.
How are you to do all this? Practice, practice, PRACTICE. Practice recognition of congestion areas. Practice recognition of high probability breakouts. Practice trend recognition. Practice and more practice. Just like anyone who wants to achieve perfection at anything, there must be total dedication, study, practice and more practice. You are to become a trading virtuoso. You are to practice, yet always realizing that you will never attain true perfection, that there is always room for improvement. There is usually a way to refine: ways that you can do things better, more efficiently, and with greater speed and finesse.
source:/cnmforextrading.blogspot.com/2009/08/achieving-trading-perfection.html
Trade selection and adequate planning go hand in hand. This is where most would-be professional traders miss the boat.
Much more money is made as a result of proper planning than from sitting and trading everything that comes along or "looks" good.
It’s difficult to fully understand why people think they have to trade so much. It’s difficult to truly grasp why people think that they have to take as many trades as they do.
Just the opposite is true. There is a correct approach to each and every trade. That is what achieving perfection is all about.
It all starts with proper management: planning, organizing, delegating, directing, and controlling.
These facets of management must be woven together into your trading; they do overlap.
Although planning is the major management function involved in achieving perfection, you can’t possibly plan well unless you are organized to do so.
You must have your tools at hand: your trading software, your data, the proper equipment. All of the rudiments for planning must be in place, which in itself is a part of organizing.
You must be physically fit when you plan: well nourished, properly exercised, well rested and mentally alert - all part of having your life organized, all part of achieving perfection as a trader.
To be a winning trader, you have to be among the best. There can be no middle ground. There are only winners and losers, and to be a winner you have to be a champion. And, just like any champion, you must have discipline, self-control, and a willingness to train, train, train.
There are no runners-up in trading, you either get the gold or you give the gold. Often, while others are busy going to parties or watching sports events, you are busy poring over charts, studying, thinking, planning. When others are listening to music or watching TV, you are busy practicing your trading, practicing trade selection, working hard to become a more astute trader.
Part of achieving perfection involves the diligent study of charts. The data, as presented on your screen and preserved as charts, are, for the most part, all you have for making trading decisions. They are a picture, a visualization of what is taking place in the reality of the market. Your job in achieving perfection and becoming an adequate trader is to picture and imagine in your mind what makes prices move and form the way they do. Ask yourself, "How does what I see in front of me relate to the supply and demand for the underlying?" Ask yourself, "Is what I am seeing on the chart even related to supply and demand, or is what I am seeing related to an engineered move by some insider or market mover?"
Supply and demand are not what makes prices move or fail to move most of the time. The sooner you realize that fact, the better off you will be. Markets are engineered, manipulated ¾ you need to know that.
But there’s more to a chart than merely price patterns. Reflected in the chart are the emotional reactions of human beings. Reactions to rumors and news; to national and world events; to government reports - these, too, are on the charts.
You might say that price movement, or the lack thereof, is the net effect of all the perceptions of all the traders who are participating in the market for a particular futures.
There is something else on the charts, something that too few take into account. That something is the manipulations from and by the insiders, the market movers, and by commercials holding large inventories of the underlying you are attempting to trade.
In achieving perfection as a trader, you must train yourself to look for evidence of any and all of these things as you study your charts. It is the cumulative action of all perceptions which causes patterns to form on a price chart.
You must learn to look for the truths in the markets. There are certain truths which are self-evident; they are always true. For instance, take the phenomenon of a breakout. When prices break out, no one can change the fact that they did break out. It is a fact and it is true. The breakout may turn out to be a "false" breakout, but nevertheless it is a breakout. As part of achieving perfection in your trade selection skills, you have to learn to tell which breakouts are most likely true breakouts, and which ones are most likely false. How can you know? By the price patterns on the chart.
And what about trend? Your job in achieving perfection as a trader is to master how to trade a trend. A trend is a trend, is a trend. It is a trend until the end, and part of your job is to know when a market is not trending.
The trend is the trend while it lasts. While a market is trending it is telling the truth. The trend can change, but the truth is the truth. If prices are rising, the trend is up. If prices are falling, the trend is down. The truth can be found in the trend. It is an immutable fact. You are to learn to make my money by trading with the trend. You are to learn what constitutes a trend. You have to learn to spot trends early so that you can make the most out of the market while it is trending. Your job in achieving perfection as a trader is to learn to recognize when a trend will most likely begin, and just as important, to learn to be even more adept at deciphering when a trend is ending.
In achieving perfection, you must learn to recognize "your" trade(s), and to take only "your" trades. Trade the formations and patterns that you can easily recognize and identify.
You must learn to trade using tips and tricks that you are shown and to accumulate and keep a collection of techniques that result in the selection of high probability trades.
How are you to do all this? Practice, practice, PRACTICE. Practice recognition of congestion areas. Practice recognition of high probability breakouts. Practice trend recognition. Practice and more practice. Just like anyone who wants to achieve perfection at anything, there must be total dedication, study, practice and more practice. You are to become a trading virtuoso. You are to practice, yet always realizing that you will never attain true perfection, that there is always room for improvement. There is usually a way to refine: ways that you can do things better, more efficiently, and with greater speed and finesse.
source:/cnmforextrading.blogspot.com/2009/08/achieving-trading-perfection.html
Using the 10 Day Moving Average of the VIX (Volatility Index) to time a Reversal in the the S&P 500
Investors can get an idea of when the market may reverse when the 10 Day Moving Average (MA) of the Volatility Index (VIX) becomes significantly stretched away from its 10 Day Moving Average (MA). A simple example is shown below which compares the 10 Day MA of the VIX to the S&P 500.
Notice when the VIX got stretched significantly away from its 10 Day MA (blue line) to the upside (points A) that the S&P 500 made a bottom (points B) and then reversed to the upside.
Thus keeping track of where the Volatility Index is in relation to its 10 Day Moving Average can give investors a clue to when the market may be getting close to a near term bottom and possible upside reversal.
source:cnmforextrading.blogspot.com/
Notice when the VIX got stretched significantly away from its 10 Day MA (blue line) to the upside (points A) that the S&P 500 made a bottom (points B) and then reversed to the upside.
Thus keeping track of where the Volatility Index is in relation to its 10 Day Moving Average can give investors a clue to when the market may be getting close to a near term bottom and possible upside reversal.
source:cnmforextrading.blogspot.com/
What is The Law of Charts™?
The Law of Charts was discovered by Master Trader Joe Ross. As he likes to say, "It was there all along. It just happened to fall on my head much as the law of gravity was discovered when an apple fell on Isaac Newton’s head."
The Law of Charts defines four basic formations known as 1-2-3 lows and highs, Ross hooks, trading ranges, and ledges. These occur in all time frames because the depict human action and reaction vis-Ã -vis price movement.
What makes these formations unique is that they can be specifically defined. The ability to formulate a more precise definition sets these formations apart from such vague generalities as "head and shoulders," "coils," "flags," "pennants," "megaphones," and other such supposed price patterns that are frequently attached as labels to the action of prices.
A 1-2-3 high or low comes at the end of a trend or swing. It forms as the result of a change in the direction of prices. The 1-2-3 low forms as the result of buying pressure overcoming that of selling pressure. The 1-2-3 high forms as the result of selling pressure overcoming buying pressure.
A Ross hook™ always forms as the result of profit taking in an trend or swing.
A ledge forms as a result of profit taking, uncertainty about future price direction, or both. You might consider it as a pause in the overall movement of prices in a single direction.
A ledge is the smallest of a number of consolidation formations: it never consists of more than 10 or less than 4 price bars. It is denoted by containing two matching or nearly matching highs and two matching or nearly matching lows.
A consolidation consisting of eleven to 20 price bars is called a congestion, and a consolidation consisting of 21 or more price bars.
As simple as these definitions are, the have been found to constitute a "law." Any data that contains both a high and a low, will form these patterns; even data that has nothing to do with markets and trading.
Learn more about The Law of Charts, it is a free resource on our website. Study it as much as you want. And while you are visiting take a look at the Traders Trick™ entry.
source:cnmforextrading.blogspot.com/
The Law of Charts defines four basic formations known as 1-2-3 lows and highs, Ross hooks, trading ranges, and ledges. These occur in all time frames because the depict human action and reaction vis-Ã -vis price movement.
What makes these formations unique is that they can be specifically defined. The ability to formulate a more precise definition sets these formations apart from such vague generalities as "head and shoulders," "coils," "flags," "pennants," "megaphones," and other such supposed price patterns that are frequently attached as labels to the action of prices.
A 1-2-3 high or low comes at the end of a trend or swing. It forms as the result of a change in the direction of prices. The 1-2-3 low forms as the result of buying pressure overcoming that of selling pressure. The 1-2-3 high forms as the result of selling pressure overcoming buying pressure.
A Ross hook™ always forms as the result of profit taking in an trend or swing.
A ledge forms as a result of profit taking, uncertainty about future price direction, or both. You might consider it as a pause in the overall movement of prices in a single direction.
A ledge is the smallest of a number of consolidation formations: it never consists of more than 10 or less than 4 price bars. It is denoted by containing two matching or nearly matching highs and two matching or nearly matching lows.
A consolidation consisting of eleven to 20 price bars is called a congestion, and a consolidation consisting of 21 or more price bars.
As simple as these definitions are, the have been found to constitute a "law." Any data that contains both a high and a low, will form these patterns; even data that has nothing to do with markets and trading.
Learn more about The Law of Charts, it is a free resource on our website. Study it as much as you want. And while you are visiting take a look at the Traders Trick™ entry.
source:cnmforextrading.blogspot.com/
Online Forex Broker Profile
MoneyForex Financial Ltd. is one of the world leading online currency trading broker offering low pips and commission-free online forex trading. Founded by Wall Street veterans, MoneyForex's vision is to service individual and corporate investors such as money managers, banks, and financial institutions in easing the complexity in dealing with forex trading. Our dealing software which specialized in forex dealing is rated second to none for it user friendly environment. Lightning speed and efficient execution is one of its many benefits.
MoneyForex Financial Ltd. is incorporated in British Virgin Island (Registration Number 629302) under the provisions of the International Business Companies Act, 1984. MoneyForex is authorized to offer futures, securities, and foreign exchange as a forex broker and primary market maker.
MoneyForex is founded by a group of Wall Street Veterans who has more than 30 years experience in the financial market. Other than the financial industry, the group operates various businesses including real estate development, media communication, advertising, internet technology and software application and development.
In this complex forex market, a user friendly platform is a must in order to make fast and efficient trading decision and execution. Our trading platform is rated the most user friendly by professional traders. MoneyForex's clients consist of financial institutions, money managers as well as individual investors.
We take pride in our professional staff that is thoroughly trained to look after the best interests of our clients. Our professional staff is available twenty-four hours a day (Monday to Friday) to answer your inquiry. Try out our service by open a free demo forex account.
source:cnmforextrading.blogspot.com/
MoneyForex Financial Ltd. is incorporated in British Virgin Island (Registration Number 629302) under the provisions of the International Business Companies Act, 1984. MoneyForex is authorized to offer futures, securities, and foreign exchange as a forex broker and primary market maker.
MoneyForex is founded by a group of Wall Street Veterans who has more than 30 years experience in the financial market. Other than the financial industry, the group operates various businesses including real estate development, media communication, advertising, internet technology and software application and development.
In this complex forex market, a user friendly platform is a must in order to make fast and efficient trading decision and execution. Our trading platform is rated the most user friendly by professional traders. MoneyForex's clients consist of financial institutions, money managers as well as individual investors.
We take pride in our professional staff that is thoroughly trained to look after the best interests of our clients. Our professional staff is available twenty-four hours a day (Monday to Friday) to answer your inquiry. Try out our service by open a free demo forex account.
source:cnmforextrading.blogspot.com/
Why MoneyForex?
Forex Trading with MoneyForex Financial Ltd. can offer benefits to traders and investors around the world.
One of the main benefits of an offshore forex trading account is that there is none capital gain tax incurred from forex trading activities. Either you made $1000 or even $1 million, MoneyForex has no obligation to report the capital gain to any tax authority.
For any resident around the world, this will offers considerable cash flow benefits especially for the larger account holders, money managers, and financial institutions as one can plan the payment of tax more efficiently. However, one still have a duty to declare taxation to the appropriate tax authority.
Commission-Free
No commission on either entering or exit the market.
User Friendly Trading Platform
Rated the most user friendly trading platform by professional traders. Features What You Click Is What You Get (WYCIWYG).Unlike many other forex platform, we do not re-quote the price. For comparison Chart of MoneyForex Trader with MetaTrader and other platforms, please click here.
Accessibility
Accessible to most information needed from checking account balance, floating positions to printing account balance all through the platform.
Light Speed Execution
When comes to forex trading, speed is one of the most important criteria. Try out our lightning speed execution with our trading platform.
High Leverage
Free margin on hedge or lock position (which many trading platforms do not allow).
Low Spread
Spread on major currency pairs are between 3-5 pips which is the lowest in the industry.
Safety of Fund
Investor funds are held separately with company operating capital in reputable banks.
State of The Art Dealing Facilities
Other than the advance dealing platform, we are backed by 24-hours live dealing via telephone.
Professional Dealers
All our dealers are former dealers of major banks and at least 5 years of experience dealing in forex.
Managed Account
Our manage accounts are manage by Wall Street professional money manager with more than 10 years of experience trading in forex. Please contact us for more information.
Introducing Broker Program (IB)
We have the best IB program in the industry. For more information, please contact us.
Offshore Money Haven
Your investment will be parked in major offshore Bank and rest assures it will be treated in confidentiality manner. It helps to keep your private and business affairs away from public eyes in an offshore jurisdiction. Invest in offshore will secure your assets against possible future claim.
Asset Protection
Invest in offshore will secure your assets against possible future claim.
source:cnmforextrading.blogspot.com/
One of the main benefits of an offshore forex trading account is that there is none capital gain tax incurred from forex trading activities. Either you made $1000 or even $1 million, MoneyForex has no obligation to report the capital gain to any tax authority.
For any resident around the world, this will offers considerable cash flow benefits especially for the larger account holders, money managers, and financial institutions as one can plan the payment of tax more efficiently. However, one still have a duty to declare taxation to the appropriate tax authority.
Commission-Free
No commission on either entering or exit the market.
User Friendly Trading Platform
Rated the most user friendly trading platform by professional traders. Features What You Click Is What You Get (WYCIWYG).Unlike many other forex platform, we do not re-quote the price. For comparison Chart of MoneyForex Trader with MetaTrader and other platforms, please click here.
Accessibility
Accessible to most information needed from checking account balance, floating positions to printing account balance all through the platform.
Light Speed Execution
When comes to forex trading, speed is one of the most important criteria. Try out our lightning speed execution with our trading platform.
High Leverage
Free margin on hedge or lock position (which many trading platforms do not allow).
Low Spread
Spread on major currency pairs are between 3-5 pips which is the lowest in the industry.
Safety of Fund
Investor funds are held separately with company operating capital in reputable banks.
State of The Art Dealing Facilities
Other than the advance dealing platform, we are backed by 24-hours live dealing via telephone.
Professional Dealers
All our dealers are former dealers of major banks and at least 5 years of experience dealing in forex.
Managed Account
Our manage accounts are manage by Wall Street professional money manager with more than 10 years of experience trading in forex. Please contact us for more information.
Introducing Broker Program (IB)
We have the best IB program in the industry. For more information, please contact us.
Offshore Money Haven
Your investment will be parked in major offshore Bank and rest assures it will be treated in confidentiality manner. It helps to keep your private and business affairs away from public eyes in an offshore jurisdiction. Invest in offshore will secure your assets against possible future claim.
Asset Protection
Invest in offshore will secure your assets against possible future claim.
source:cnmforextrading.blogspot.com/
Corporate News
MoneyForex Financial Ltd. is one of the world leading online forex currency and CFDs trading broker offering low pips and commission-free online forex trading. MoneyForex has been known as one of the reputable offshore forex broker that provides top level services to high privillege investors around the world. Our company has been a regular contributors of forex news and signals to many forex resources such as the following:
* FxStreet.com
* Bloomberg News
* Reuters
* ForexYellowPages.com
* FXNews.co.uk
* Search-Forex.com
* Every-Forex.com
* BrokersMatrix.com
* Earn up to a $1000 bonus for existing and new clients!
* MoneyForex.com offers online streaming forex news
* Announcing MoneyForex Trader, the best online forex trading platform in the industry
* MoneyForex Trader comes with charting and news
In The Press
* PR News - MoneyForex launched new trading instruments; CFDs, Commodities Futures Contract and Indices.
* BrokersMatrix.com - Profiling of MoneyFOREX.com as recommended Forex Broker; Commodities Futures and CFDs trading Brokers.
* PRWeb News - MoneyForex FInancial Ltd. Announces New Forex Trading Platform
* FXStreet.com - MoneyForex's Profile.
source:cnmforextrading.blogspot.com/
* FxStreet.com
* Bloomberg News
* Reuters
* ForexYellowPages.com
* FXNews.co.uk
* Search-Forex.com
* Every-Forex.com
* BrokersMatrix.com
* Earn up to a $1000 bonus for existing and new clients!
* MoneyForex.com offers online streaming forex news
* Announcing MoneyForex Trader, the best online forex trading platform in the industry
* MoneyForex Trader comes with charting and news
In The Press
* PR News - MoneyForex launched new trading instruments; CFDs, Commodities Futures Contract and Indices.
* BrokersMatrix.com - Profiling of MoneyFOREX.com as recommended Forex Broker; Commodities Futures and CFDs trading Brokers.
* PRWeb News - MoneyForex FInancial Ltd. Announces New Forex Trading Platform
* FXStreet.com - MoneyForex's Profile.
source:cnmforextrading.blogspot.com/
Introduction to Trading Forex
This short introduction explains the basics of trading Forex online, a brief explanation of the markets and the major benefits of trading Forex online. There are also two scenarios describing the implications of trading in a bear as well as a bull market to better acquaint you with some of the risks and opportunities of the largest and most liquid market in the world.
As an additional aid for those who are new to Forex, there is also a glossary at the bottom of this text which explains some of the terms used in connection with currency trading.
Overview
Foreign exchange, Forex or just FX are all terms used to describe the trading of the world's many currencies. The Forex market is the largest market in the world, with trades amounting to more than USD 3 trillion every day. Most Forex trading is speculative, with only a low percentage of market activity representing governments' and companies' fundamental currency conversion needs.Unlike trading on the stock market, the Forex market is not conducted by a central exchange, but on the “interbank” market, which is thought of as an OTC (over the counter) market. Trading takes place directly between the two counterparts necessary to make a trade, whether over the telephone or on electronic networks all over the world. The main centres for trading are Sydney, Tokyo, London, Frankfurt and New York. This worldwide distribution of trading centres means that the Forex market is a 24-hour market.
Trading Forex
A currency trade is the simultaneous buying of one currency and selling of another one. The currency combination used in the trade is called a cross (for example, the euro/US dollar, or the GB pound/Japanese yen.). The most commonly traded currencies are the so-called “majors” – EURUSD, USDJPY, USDCHF and GBPUSD.
The most important Forex market is the spot market as it has the largest volume. The market is called the spot market because trades are settled immediately, or “on the spot”. In practice this means two banking days.
Forward Outrights
For forward outrights, settlement on the value date selected in the trade means that even though the trade itself is carried out immediately, there is a small interest rate calculation left. The interest rate differential doesn't usually affect trade considerations unless you plan on holding a position with a large differential for a long period of time. The interest rate differential varies according to the cross you are trading. On the USDCHF, for example, the interest rate differential is quite small, whereas the differential on NOKJPY is large. This is because if you trade e.g. NOKJPY, you get almost 7% (annual) interest in Norway and close to 0% in Japan. So, if you borrow money in Japan, to finance the trade and buying NOK, you have a positive interest rate differential. This differential has to be calculated and added to your account. You can have both a positive and a negative interest rate differential, so it may work for or against you when you make a trade.Trading on Margin
Trading on margin means that you can buy and sell assets that represent more value than the capital in your account. Forex trading is usually conducted with relatively small margin deposits. This is useful since it permits investors to exploit currency exchange rate fluctuations which tend to be very small. A margin of 1.0% means you can trade up to USD 1,000,000 even though you only have USD 10,000 in your account. A margin of 1% corresponds to a 100:1 leverage (or “gearing”). (Because USD 10,000 is 1% of USD 1,000,000.) Using this much leverage enables you to make profits very quickly, but there is also a greater risk of incurring large losses and even being completely wiped out. Therefore, it is inadvisable to maximise your leveraging as the risks can be very high. For more information on the trading conditions of Saxo Bank, go to the Account Summary on your SaxoTrader and open the section entitled “Trading Conditions” found in the top right-hand corner of the Account Summary.Why Trade Forex?
-
24 hour trading
One of the major advantages of trading Forex is the opportunity to trade 24 hours a day from Sunday evening (20:00 GMT) to Friday evening (22:00 GMT). This gives you a unique opportunity to react instantly to breaking news that is affecting the markets. -
Superior liquidity
The Forex market is so liquid that there are always buyers and sellers to trade with. The liquidity of this market, especially that of the major currencies, helps ensure price stability and narrow spreads. The liquidity comes mainly from banks that provide liquidity to investors, companies, institutions and other currency market players. -
No commissions
The fact that Forex is often traded without commissions makes it very attractive as an investment opportunity for investors who want to deal on a frequent basis.
Trading the “majors” is also cheaper than trading other cross because of the high level of liquidity. For more information on the trading conditions of Saxo Bank, go to the Account Summary on your SaxoTrader and open the section entitled “Trading Conditions” found in the top right-hand corner of the Account Summary. -
100:1 Leverage
Leverage (gearing) enables you to hold a position worth up to 100 times more than your margin deposit. For example, a USD 10,000 deposit can command positions of up to USD 1,000,000 through leverage. You can leverage the first USD 25,000 of your investment up to 100 times and additional collateral up to 50 times. -
Profit potential in falling markets
Since the market is constantly moving, there are always trading opportunities, whether a currency is strengthening or weakening in relation to another currency. When you trade currencies, they literally work against each other. If the EURUSD declines, for example, it is because the US dollar gets stronger against the euro and vice versa. So, if you think the EURUSD will decline (that is, that the euro will weaken versus the dollar), you would sell EUR now and then later you buy euro back at a lower price. In case that the EURUSD indeed declines, then you can take your profit. The opposite trading scenario would occur if the EURUSD appreciates.
Important Forex Trading Terms
-
Spread
The spread is the difference between the price that you can sell currency at (Bid) and the price you can buy currency at (Ask). The spread on majors is usually 3 pips under normal market conditions. For more information on the trading conditions at Saxo Bank, go to the Account Summary on your Client Station and open the section entitled “Trading Conditions” found in the top right-hand corner of the Account Summary. -
Pips
A pip is the smallest unit by which a cross price quote changes. When trading Forex you will often hear that there is a 3-pip spread when you trade the majors. This spread is revealed when you compare the bid and the ask price, for example EURUSD is quoted at a bid price of 0.9875 and an ask price of 0.9878. The difference is USD 0.0003, which is equal to 3 “pips”.
On a contract or position, the value of a pip can easily be calculated. You know that the EURUSD is quoted with four decimals, so all you have to do is cancel out the four zeros on the amount you trade and you will have the value of one pip. Thus, on a EURUSD 100,000 contract, one pip is USD 10. On a USDJPY 100,000 contract, one pip is equal to 1000 yen, because USDJPY is quoted with only two decimals.
Trading Scenario – Trading Rising Prices
If you believe that the euro will strengthen against the dollar you'll want to buy euro now and sell it back later at a higher price.
| • You buy euro | We quote EURUSD at Bid 0.9875 and Ask 0.9878, which means that you can sell 1 euro for 0.9875 USD or buy 1 euro for 0.9878 USD. In this example you buy euro 100,000, at the quote price of 0.9878 (ask price) per euro. |
| • The market moves in your favor | Later the market turns in favour of the euro and the EURUSD is now quoted at Bid 0.9894 and Ask 0.9896. |
| • Now you sell your euro and get the profit | You sell euro at a Bid price of 0.9894. |
| • The profit is calculated as follows | Sell price-buy price x size of trade (0.9894 minus 0.9878) multiplied by 100.000 = USD 140 Profit (Note that the profit or loss is always expressed in the secondary currency) |
Trading Scenario – Trading Falling Prices
If, on the other hand, you believe that the euro will weaken against the dollar, you'll want to sell EURUSD. | • You sell euro | We quote EURUSD at a Bid price of 0.9875 and Ask price of 0.9880 and you decide to sell euro 100,000 at a Bid price of 0.9875. |
| • The market moves in your favour | The euro weakens against the dollar and the EURUSD is now quoted at bid 0.9744 and ask 0.9749. |
| • Now you buy back your euro | You buy EUR at an ask price of 0.9749. |
| • Your profit/loss is then | Sell price-buy price x size of trade (0.9875 minus 0.9749) multiplied by 100.000 = USD 1260 Profit |
Remember that trading EUR 100,000 as we have done in our examples, does not mean that you have to put up euro 100,000 yourself. On a 2% margin means that you have to deposit 2.0% of euro 100,000, which is euro 2,000 on margin as a guarantee for the future performance of your position.Further Reading
To see how you can trade the Forex market and benefit from our toolbox of information and live quotes, please proceed to the Forex Quick Start found under the Trading menu of SaxoTrader.Glossary
| • Appreciation |  | An increase in the value of a currency. |
| • Ask | | The price requested by the trader. This usually indicates the lowest price a seller will accept. |
| • Base currency | | The currency that the investor buys or sells (i.e. EUR in EURUSD). |
| • Bear | | Someone who believes prices are heading down. A bear market is one in which there has been a sustained fall in prices and which does not look like it will recover quickly. |
| • Bid | | The price offered by the trader. This usually indicates the highest price a purchaser will pay. |
| • Bid/Ask | | The Bid rate is the rate at which you can sell. The Ask (or offer) rate is the rate at which you can buy. |
| • Bull | | Someone who is optimistic about the market. A bull market is characterised by enthusiastic and sustained buying. |
| • cross | | When trading with currencies, the investor buys one currency with another. These two currencies form the cross: for example, EURUSD. |
| • Cross rate | | An exchange rate that is calculated from two other exchange rates. |
| • Depreciation/decline | | A fall in the value of a currency. |
| • EURUSD | | Means that you trade EUR against dollars. If you buy euro you pay in dollars and if you sell euro you receive dollars. |
| • FX, Forex, Foreign Exchange | | All names for the transaction of one currency for another, e.g. you buy GBP 100.00 with USD 150.25 or sell USD 150.25 for GBP 100.00. |
| • Interbank | | Short-term (often overnight) borrowing and lending between banks, as distinct from a banks business with their corporate clients or other financial institutions. |
| • Interest rate differential | | The yield spread between two otherwise comparable debt instruments denominated in different currencies. |
| • Leverage (gearing) | | The investor only funds part of the amount traded. |
| • Long | | To buy. |
| • Long position | | A position that increases its value if market prices increase. |
| • Margin | | The deposit required when entering into a position as well as to hold an open position. Your margin status can be monitored in the Account Summary. |
| • NYSE | | The New York Stock Exchange. |
| • Pips | | A pip is the smallest unit by which a Forex cross price quote changes. So if EURUSD bid is now quoted at 0.9767 and it moves up 2 pips, it will be quoted at 0.9769. |
This short introduction explains the basics of trading Forex online, a brief explanation of the markets and the major benefits of trading Forex online. There are also two scenarios describing the implications of trading in a bear as well as a bull market to better acquaint you with some of the risks and opportunities of the largest and most liquid market in the world.
As an additional aid for those who are new to Forex, there is also a glossary at the bottom of this text which explains some of the terms used in connection with currency trading.
Overview
Foreign exchange, Forex or just FX are all terms used to describe the trading of the world's many currencies. The Forex market is the largest market in the world, with trades amounting to more than USD 3 trillion every day. Most Forex trading is speculative, with only a low percentage of market activity representing governments' and companies' fundamental currency conversion needs.Unlike trading on the stock market, the Forex market is not conducted by a central exchange, but on the “interbank” market, which is thought of as an OTC (over the counter) market. Trading takes place directly between the two counterparts necessary to make a trade, whether over the telephone or on electronic networks all over the world. The main centres for trading are Sydney, Tokyo, London, Frankfurt and New York. This worldwide distribution of trading centres means that the Forex market is a 24-hour market.
Trading Forex
A currency trade is the simultaneous buying of one currency and selling of another one. The currency combination used in the trade is called a cross (for example, the euro/US dollar, or the GB pound/Japanese yen.). The most commonly traded currencies are the so-called “majors” – EURUSD, USDJPY, USDCHF and GBPUSD.
The most important Forex market is the spot market as it has the largest volume. The market is called the spot market because trades are settled immediately, or “on the spot”. In practice this means two banking days.
Forward Outrights
For forward outrights, settlement on the value date selected in the trade means that even though the trade itself is carried out immediately, there is a small interest rate calculation left. The interest rate differential doesn't usually affect trade considerations unless you plan on holding a position with a large differential for a long period of time. The interest rate differential varies according to the cross you are trading. On the USDCHF, for example, the interest rate differential is quite small, whereas the differential on NOKJPY is large. This is because if you trade e.g. NOKJPY, you get almost 7% (annual) interest in Norway and close to 0% in Japan. So, if you borrow money in Japan, to finance the trade and buying NOK, you have a positive interest rate differential. This differential has to be calculated and added to your account. You can have both a positive and a negative interest rate differential, so it may work for or against you when you make a trade.Trading on Margin
Trading on margin means that you can buy and sell assets that represent more value than the capital in your account. Forex trading is usually conducted with relatively small margin deposits. This is useful since it permits investors to exploit currency exchange rate fluctuations which tend to be very small. A margin of 1.0% means you can trade up to USD 1,000,000 even though you only have USD 10,000 in your account. A margin of 1% corresponds to a 100:1 leverage (or “gearing”). (Because USD 10,000 is 1% of USD 1,000,000.) Using this much leverage enables you to make profits very quickly, but there is also a greater risk of incurring large losses and even being completely wiped out. Therefore, it is inadvisable to maximise your leveraging as the risks can be very high. For more information on the trading conditions of Saxo Bank, go to the Account Summary on your SaxoTrader and open the section entitled “Trading Conditions” found in the top right-hand corner of the Account Summary.Why Trade Forex?
-
24 hour trading
One of the major advantages of trading Forex is the opportunity to trade 24 hours a day from Sunday evening (20:00 GMT) to Friday evening (22:00 GMT). This gives you a unique opportunity to react instantly to breaking news that is affecting the markets. -
Superior liquidity
The Forex market is so liquid that there are always buyers and sellers to trade with. The liquidity of this market, especially that of the major currencies, helps ensure price stability and narrow spreads. The liquidity comes mainly from banks that provide liquidity to investors, companies, institutions and other currency market players. -
No commissions
The fact that Forex is often traded without commissions makes it very attractive as an investment opportunity for investors who want to deal on a frequent basis.
Trading the “majors” is also cheaper than trading other cross because of the high level of liquidity. For more information on the trading conditions of Saxo Bank, go to the Account Summary on your SaxoTrader and open the section entitled “Trading Conditions” found in the top right-hand corner of the Account Summary. -
100:1 Leverage
Leverage (gearing) enables you to hold a position worth up to 100 times more than your margin deposit. For example, a USD 10,000 deposit can command positions of up to USD 1,000,000 through leverage. You can leverage the first USD 25,000 of your investment up to 100 times and additional collateral up to 50 times. -
Profit potential in falling markets
Since the market is constantly moving, there are always trading opportunities, whether a currency is strengthening or weakening in relation to another currency. When you trade currencies, they literally work against each other. If the EURUSD declines, for example, it is because the US dollar gets stronger against the euro and vice versa. So, if you think the EURUSD will decline (that is, that the euro will weaken versus the dollar), you would sell EUR now and then later you buy euro back at a lower price. In case that the EURUSD indeed declines, then you can take your profit. The opposite trading scenario would occur if the EURUSD appreciates.
Important Forex Trading Terms
-
Spread
The spread is the difference between the price that you can sell currency at (Bid) and the price you can buy currency at (Ask). The spread on majors is usually 3 pips under normal market conditions. For more information on the trading conditions at Saxo Bank, go to the Account Summary on your Client Station and open the section entitled “Trading Conditions” found in the top right-hand corner of the Account Summary. -
Pips
A pip is the smallest unit by which a cross price quote changes. When trading Forex you will often hear that there is a 3-pip spread when you trade the majors. This spread is revealed when you compare the bid and the ask price, for example EURUSD is quoted at a bid price of 0.9875 and an ask price of 0.9878. The difference is USD 0.0003, which is equal to 3 “pips”.
On a contract or position, the value of a pip can easily be calculated. You know that the EURUSD is quoted with four decimals, so all you have to do is cancel out the four zeros on the amount you trade and you will have the value of one pip. Thus, on a EURUSD 100,000 contract, one pip is USD 10. On a USDJPY 100,000 contract, one pip is equal to 1000 yen, because USDJPY is quoted with only two decimals.
Trading Scenario – Trading Rising Prices
If you believe that the euro will strengthen against the dollar you'll want to buy euro now and sell it back later at a higher price. | • You buy euro | We quote EURUSD at Bid 0.9875 and Ask 0.9878, which means that you can sell 1 euro for 0.9875 USD or buy 1 euro for 0.9878 USD. In this example you buy euro 100,000, at the quote price of 0.9878 (ask price) per euro. |
| • The market moves in your favor | Later the market turns in favour of the euro and the EURUSD is now quoted at Bid 0.9894 and Ask 0.9896. |
| • Now you sell your euro and get the profit | You sell euro at a Bid price of 0.9894. |
| • The profit is calculated as follows | Sell price-buy price x size of trade (0.9894 minus 0.9878) multiplied by 100.000 = USD 140 Profit (Note that the profit or loss is always expressed in the secondary currency) |
Trading Scenario – Trading Falling Prices
If, on the other hand, you believe that the euro will weaken against the dollar, you'll want to sell EURUSD. | • You sell euro | We quote EURUSD at a Bid price of 0.9875 and Ask price of 0.9880 and you decide to sell euro 100,000 at a Bid price of 0.9875. |
| • The market moves in your favour | The euro weakens against the dollar and the EURUSD is now quoted at bid 0.9744 and ask 0.9749. |
| • Now you buy back your euro | You buy EUR at an ask price of 0.9749. |
| • Your profit/loss is then | Sell price-buy price x size of trade (0.9875 minus 0.9749) multiplied by 100.000 = USD 1260 Profit |
Remember that trading EUR 100,000 as we have done in our examples, does not mean that you have to put up euro 100,000 yourself. On a 2% margin means that you have to deposit 2.0% of euro 100,000, which is euro 2,000 on margin as a guarantee for the future performance of your position.Further Reading
To see how you can trade the Forex market and benefit from our toolbox of information and live quotes, please proceed to the Forex Quick Start found under the Trading menu of SaxoTrader.Glossary
| • Appreciation | | An increase in the value of a currency. |
| • Ask | | The price requested by the trader. This usually indicates the lowest price a seller will accept. |
| • Base currency | | The currency that the investor buys or sells (i.e. EUR in EURUSD). |
| • Bear | | Someone who believes prices are heading down. A bear market is one in which there has been a sustained fall in prices and which does not look like it will recover quickly. |
| • Bid | | The price offered by the trader. This usually indicates the highest price a purchaser will pay. |
| • Bid/Ask | | The Bid rate is the rate at which you can sell. The Ask (or offer) rate is the rate at which you can buy. |
| • Bull | | Someone who is optimistic about the market. A bull market is characterised by enthusiastic and sustained buying. |
| • cross | | When trading with currencies, the investor buys one currency with another. These two currencies form the cross: for example, EURUSD. |
| • Cross rate | | An exchange rate that is calculated from two other exchange rates. |
| • Depreciation/decline | | A fall in the value of a currency. |
| • EURUSD | | Means that you trade EUR against dollars. If you buy euro you pay in dollars and if you sell euro you receive dollars. |
| • FX, Forex, Foreign Exchange | | All names for the transaction of one currency for another, e.g. you buy GBP 100.00 with USD 150.25 or sell USD 150.25 for GBP 100.00. |
| • Interbank | | Short-term (often overnight) borrowing and lending between banks, as distinct from a banks business with their corporate clients or other financial institutions. |
| • Interest rate differential | | The yield spread between two otherwise comparable debt instruments denominated in different currencies. |
| • Leverage (gearing) | | The investor only funds part of the amount traded. |
| • Long | | To buy. |
| • Long position | | A position that increases its value if market prices increase. |
| • Margin | | The deposit required when entering into a position as well as to hold an open position. Your margin status can be monitored in the Account Summary. |
| • NYSE | | The New York Stock Exchange. |
| • Pips | | A pip is the smallest unit by which a Forex cross price quote changes. So if EURUSD bid is now quoted at 0.9767 and it moves up 2 pips, it will be quoted at 0.9769. |
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