Kc Yap asked:


So.. you want to make lots of money in forex trading..? Well, before you get your feet wet….let me refresh your mind why forex trading is such a hot money maker…

Here’s a few reasons why….

The cash/spot FOREX markets have certain unique attributes that offer an unmatched potential for profitable trading in any market condition or any stage of the business cycle. It leaves one to wonder why bother in the first place? The answer to that is very simple. Forex trading offers people who trade:

A 24-hour market: A trader has the chance to take advantage of all of the profitable market conditions at any time; which means that there is no waiting for the start like the New York Stock exchange.

Highest liquidity Possible: The FOREX market is the most liquid market in the world. That means that a trader can enter or exit the market whenever they want during almost any market condition minimal execution barriers or risk and no daily trading limit.

High leverage: It has a leverage ratio of up to 400 is normal when compared to a leverage ratio of 2 in the equity markets. Of course, this makes trading in the cash/spot forex market awkward a swell because it makes the risk of the down side loss much higher in the same way that it makes the profit potential on the upside much prettier.

Low cost per transaction: The retail transaction cost is actually less than 0.1% under the normal market conditions. At larger dealers, the spread could be less than 5 pips, and may expand a great deal in fast moving markets.

Always a good market: A trade in the FOREX market means selling or buying one currency against another. In essence, a bull market or a bear market for a currency is defined in terms of the outlook for value against other currencies. If the outlook is positive, you get a bull market where a trader profits by buying the currency against other currencies.

Inter-bank market: The foundation of the FOREX market consists of a global network of dealers that communicate and trade with their clients through electronic networks and telephones. There are no organized exchanges like in futures that are there to serve as a central location to facilitate transactions the way the New York Stock Exchange serves the equity markets.

No one can corner the market: The FOREX market is so large and has so many participants that no single trader, even a central bank, can control the market price for an extended period of time.

It is not completely Unregulated: The FOREX market is seen as an unregulated market although the operations of major dealers like

commercial banks in money centers are regulated under the banking laws.

For the average person who is willing to get into forex trading, this market is just a better bet. With it being so wide open like it is, you have a higher gross potential than with any other trade type.

Wishing you success

KC Yap

info@nicheinfosite.com

Copyright 2005

by KC Yap forex-trading-tricks.blogspot.com

Edward Lomax asked:


rex traders are looking for a profitable Forex trading system. We want something we can follow with predictable results. And as no system can be 100% accurate… we want a trading system that is profitable… one that makes it worth our time trading.

But once we find a Forex Trading System that works… we tend to stop looking for ways to make it even more profitable. I understand the hesitation… making changes could cost you winning trades and money. So, once the profitable system is found, traders trade that system without wondering if the system could be improved.

While coming up with a winning trading system is no small feat, how do you know you are trading the most profitable way? You don’t, unless you test! The purpose of this article is to give you three things to look at that could make your trading more profitable.

Look At Your Forex Trading System Stop Loss

You should always trade with a Stop Loss. If the market changes direction, you need a safety net to keep the losses in control. But a tight Stop Loss that keeps your potential loss really low might be keeping your from a higher percentage of winning trades.

The trick is to find the “sweet spot” when placing your Stop Loss. Pay attention to the currency pair you are trading as well as the Chart (M15, H1, D1, etc), you are trading. Then you need to test different Stop Loss ranges to look for the one that lets the trade develop without stopping you out of the trade prematurely, but that also limits risk. Again, the only real way to find this “sweet spot” is to test.

Look At Your Forex Trading System Take Profit

The way you decide to EXIT the trade is just as important as entering and managing the trade. If you want a high win rate, you can set your Take Profit close to the entry level… but that is not the most profitable way to trade. Again, there will be a “sweet spot” according to the currency pair and chart time.

Imagine if you can get an extra 10 pips of profit for each winning trade without reducing your winning trade percentage. Just think of how much MORE money you make with the SAME trades. While your take profit targets should be reasonable, don’t leave money on the table.

Look At Your Forex Trading Systems Money Management

Even a trading method with a high winning percentage can lose you money if you don’t know how to manage your money. And really, your money management should be based on your Stop Loss, Take Profit targets and risk tolerance. First, you need to figure out how much of your account balance you’ll risk on each trade. Then you need to determine a LOT size that fits with your stop loss and take profit strategy.

Once you have a trading system that hits the “sweet spots” with a solid money management plan, you can rest assured you are getting the most out of every winning trade… and controlling your loses. But if there is one thing you should take away from this article it is that just because your system may be profitable… it does not mean it can’t be improved! And each little improvement means a lot more money for you.

Bernice Eker asked:


There are hundreds or even thousands of companies and manufacturers in the internet that are offering the secret to winning consistently in the foreign exchange market by using an automated forex trading program.

There are more people involved in trading foreign currencies that fail and lose their money because of misjudgement. Consistency is the trick so that a trader can last long in the world of forex trading.

It is no secret that trading is difficult and mistakes are very common. Experts say that the best way to avoid this is to take up forex education first and learn about the basic principles and methods of trading. After that, they should practice using demo accounts that provide somewhat of a simulation of the market itself so the aspiring trader would be able to catch a glimpse of how the market actually works.

Sometimes all the education and training isn’t enough to make anyone a successful trader because they do not have the innate skills required for the job or they do not have the time. This is where an automated forex trading system comes in. This does everything for the trader. Monitoring trades, analyzing charts, the market and the upcoming trends and based on that information, it will do the proper action.

If it is able to predict that a particular trend is going to go up, it can immediately trade in that trend. The best part about this system is that it can react faster than any person. Once a change happens in the market it can do the proper action in milliseconds thus, minimizing the risk and maximizing the profits of the trader.

The automated forex trading system is usually based on the trading style of a successful trader. More often than not, these successful traders are the ones who create these systems to spread their knowledge about trading foreign currencies and help aspiring traders. It uses a sequence of mathematical codes and calculations to make the best possible trades and in effect, earn consistently.

When it comes to choosing one of the many automated forex trading systems available in the internet, there are a few things that you should look for. First thing is that it should be created by a forex trader who has a good background in the market. Next, the system should have a demo account so you can test its capabilities and if it has what you need or want. Another important part is making sure that the statistics presented by the company are real.

The best place to get all of this information is not with the product’s website, but through third party websites which gives a review on different forex trading programs. They also have comments from those who have tried the program. The website should be a third party so that the reviews and comments are unbiased. It is very important to do your research and your homework before buying a particular product so that you can be sure you are getting your money’s worth and not just something you will regret later on.

Agnesuma asked:


Many people tend to invest in either Forex trading or stock exchange market but most of them are not really aware of the difference between the two and do not know which is the right investment for them. Options are as well plenty when it comes to investment. But, it is hard to say which the right option for you is until you gather some information and date about them and then move further making any decision.

Stock exchange trading is same as owning part of an organization or company. You but stocks so that the company could them use this money to reinvest to increase their profits. Most people know about the stock exchange trading market and do carry a basic idea on how it actually works.

Whereas, on the other hand we have Forex trading, not many of them realize the importance of it. Well, Forex trading is a kind of investment, which deals with currency trading. In its basic terms, you cash in US dollars for the currency of another country and cash out when you tend to make profit or to cut your losses short. The Forex trading market is a truly international market place where billions of dollars are traded everyday. Here, you could make more and more money or lose a lot of money; all depends on your fortune and trick of playing in Forex market.

In stock trading, you could make less profit in the short-term and only in the long-term you could expect huge profit. It is frequently wise for the starter to experiment in stocks trading before going for Forex trading. It is an outstanding way to get your feet wet without an entire lot of risk.

It is significant for both kinds of investments that due diligence is paid in order to generate any money. Study both forms of investments and you really need to do some paper trading as well. This simply means you make decisions to buy or sell but do not put in any kind of real money down. Forex trading is a new method of investing. It is a good option for someone who is eager to take greater risk for a greater reward.

Azman Yunan asked:


 

Majority of the public are not familiar with Forex. They always misinform about Forex. They always think Forex is too risky. You can loose big time. So better get away from Forex and just leave Forex to the professional. Think about it for a moment, is there anything else in this world that don’t carry any risk ? Even driving your car to work carries some risk. Why we’re still doing it ? Why we don’t even consider driving to work as a risky task ?

Yes, Forex does carry some risk to certain extend. That is the main reason we need to prepare ourselves before we start trading. Comparatively before you drive to work, do you learn how to drive a car first ? Definitely, we need to equip and prepare ourselves before we do anything. Otherwise we are inviting disaster. Failure is definite.

There are three major area that we need to prepare : ourselves, money management and trading system.

Before we can start anything we need to prepare ourselves. We need to equip ourselves with the necessary knowledge. Find good books about Forex and read through it. It will give us sufficient knowledge about Forex trading. It will be a good start. A cheaper method is to digest information that is freely available in the internet. Word of caution, not all information in the internet is good. Be a member of a forum related to Forex and ask around about good online reference. Additionally you can enroll to a forum or seminar. You can absorb better while having someone teaching in front of you.

Having good money management is essential to our survival. There is no way in Forex trading we can avoid loosing trade. The trick is to limit and control our loosing trade. And that can only be achieved with good money management system. Good money management will limit our loss. 1 or 2 bad trades in a row won’t stop us from trading. We still have sufficient capital in our account and continue trading.

Having good trading system is also essential. Unfortunately there is no perfect system. None of the existing system can guarantee 100% winning trade. So be extra careful if you come across some Forex Guru who claim of having 100% winning trade system. If his system if fool proof and making him ton of money, why in the world he is selling it for fraction of money ? just think about the logic behind it. Having system with proven 60-70% winning trades is good enough. As long as we are trading with a good money management system. We want to win the war not the battle.