Learn Forex Trading for Beginners

Learn What is Forex and How to Trade.

noreply@blogger.com (Learn Forex) — Sun, 12 Dec 2010 19:37:00 +0000

Why Should I Learn Forex?

If you hear from anyone that making money in Forex is easy, do not believe. It is a myth. The truth is – being profitable in Forex requires a lot of work, dedication, learn, practice, more than a good discipline, sharp knowledge of money management and understanding of the psychology of the currency market. Learn Forex before you start Trading, because to Earn you should Learn Forex.

If you are ready to Learn Forex / start Forex Trading, then this blog is for you. Here you will learn all details about forex / forex trading,

1) You will learn what is Forex and how to trade forex.
2) You will learn forex strategy / forex trading technique / forex trick.
3) You will learn how to draw forex trendline.
4) You will learn how to determine support and resistance.
5) You will learn how to use forex chart / forex indicator for entry & exit in forex market.
6) You will learn about risk management & money management.
7) You will learn how to calculate forex profit / losses and MORE.

Learn Forex: What Is It And How Does It Work? -

The currency (foreign exchange) market is the largest and oldest financial market in the world. It is also called the foreign exchange market, or "FOREX" or "FX" market for short. It is the biggest and most liquid market in the world with daily average turnover of US$1.9 trillion, and it is traded mainly through the 24 hour-a-day inter-bank currency market - the primary market for currencies.

Foreign Exchange simply means the buying of one currency and selling another at the same time. In other words, the currency of one country is exchanged for those of another. The currencies of the world are on a floating exchange rate, and are always traded in pairs.

There are two reasons to buy and sell currencies. About 5% of daily turnover is from companies and governments that buy or sell products and services in a foreign country or must convert profits made in foreign currencies into their domestic currency.

The other 95% is trading for profit, or what you call speculation. Investors frequently trade on information they believe to be superior and relevant, when in fact it is not and is fully discounted by the market.

Unlike the futures and stock markets, trading of currencies is not centralized on an exchange. Forex literally follows the sun around the world. Trading moves from major banking centers of the

U.S.

Australia

and

New Zealand

, to the Far East, to Europe and finally back to the

U.S.

Currency Symbol / Currency Pair

EUR/USD = Euro / US Dollar

GBP/USD = Pounds Sterling/ US Dollar

USD/JPY = US Dollar / Japanese Yen

USD/CHF = US Dollar / Swiss Franc

USD/CAD = US Dollar / Canadian Dollar

AUD/USD = Australian Dollar / US Dollar

NZD/USD =

New Zealand

Dollar / US Dollar

Etc.

In excess of 85 percent of all daily transactions involve trading of the major currencies - Australian Dollar, British Pound, Canadian Dollar, Japanese Yen, Swiss Franc, and the U.S. Dollar.

Currencies are traded in pairs, meaning that you are really trading one currency for another. A simple way to understand this is to consider what you do when you go on foreign vacations. If you are an

USA

, and you plan to travel to another country, say

Canada

, then you might take say $10,000 USD to the bank to change it for Canadian dollars. Let’s say the exchange rate is 1.4000, then for your $10,000 USD they would give you $14,000 CAD. Now let’s say you didn’t spend the money and upon coming home you decide to change it back to USD currency. Now let’s say the exchange rate is 1.3700 (a change of 300 pips that could happen in a week), so your $14,000 CAD would convert back to $10,218.97 US. Therefore you just made $218.97, a 2.19% increase in funds.

Reading a FOREX quote may seem a bit confusing at first. However, it's really quite simple, when you see Forex quotes you will actually see two numbers. The first number is called the bid and the second number is called the offer/ask. If we use the USD/JPY as example 115.37/115.40 the first number 115.37 is the bid price and is the price traders are prepared to buy USD against the JPY. The second number 115.40 is the offer price and is the price traders are prepared to sell the USD against the JPY.

Here in USD/JPY the currency listed first (USD) is the base currency and & the value of the base currency is always 1. A quote of USD/JPY 115 means that one U.S. dollar is equal to 115 Japanese yen. When this currency quote goes up, it means the dollar has appreciated in value and the other currency has weakened. If the USD/JPY quote increases from 115 to 117, it indicate dollar is stronger because it will now buy more yen than before.

What Next

Well now we have a basic understanding of how Forex market works what next? Now you are going to decide best way to trade the Forex market. The most common approaches are Forex fundamental analysis and Forex technical analysis.

Forex Fundamental analysis: Usually everyday, and often more than once a day, the currency pair will be moving along slowly (sideways movement, consolidation) and then all of a sudden it JUMPS! It very quickly moves up ten or more pips, usually in just a minute, and often continues to move strongly for another hour or so. This is due to the release of a “Fundamental Announcement”, and of course any experienced trader should understand that they usually create a market movement.

Forex Technical Analysis: It is technique to learn Forex market using chart and indicator to predict the future price of a security.

WHAT YOU NEED

**BROKER:

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3: You can try Plus500 they provide $20 free with No Deposit required.

**Learn Forex Money Management and Risk Analysis:

However, it is common that one afraid of being involved in Forex market because of high risk in this trading field. Although every capital market involves certain level of risk, the risk of loss in foreign currency trading market can be extensive. It would be wise to learn about the potential risk (and managing it) if you wish to trade in Forex market.

Learn Forex Today and Stop Losing! Logic is Simple "Learn Forex Earn Profit"

Choosing a Forex Broker / Forex Review / Forex Bonus

noreply@blogger.com (Learn Forex) — Fri, 01 Jan 2010 17:52:00 +0000

Choosing a Forex Broker

Before trading Forex you need to set up an account with a Forex broker. So what exactly is a forex broker? A forex broker is a forex provider that you sign up with, in order to trade the forex market.

There are many forex brokers or providers, and unlike other types of trading, there is no one centralized market. Instead there are thousands of forex brokers or market makers as they’re also called, who set their own currency prices and spreads.

But because the forex market is competitive, there’s usually not a large enough difference in prices and spreads between different forex brokers to practice arbitrage. But every forex broker is slightly different, and you should check that the broker that you’re looking at will give you a good deal Visit Here to find Good Forex Deal and Forex Bonus.

Forex Trading Platforms / Forex Trading Software

Forex brokers will provide you with an online trading platform, downloaded to your computer and requiring you to log in with them when you trade, or as a totally online interface.

The best way to see if the platform is adequate is to run their forex demo account to see if you can do all of your trading tasks on their forex trading platform.

You’ll be looking at the currency charts, applying your system rules and indicators to assess the currencies you’re looking at, placing orders of various types for the spot forex market (market orders, stop orders and limit orders), and viewing your forex account details, including your leveraged float available for trading.

Most providers will provide forex charts as a part of their online trading platforms. However the quality of the charting packages may vary, so check that you can do essential things such as drawing lines, writing notes, and plotting indicators. That is, whatever you need to do to trade the system, and this does vary from system to system. Many forex charts will be able to do all this, but sometimes they are not. Some providers have up to 2-3 levels of charting available, but one level is free.

Whether you need to upgrade will depend on the indicators you need to draw for your system. So try their demo accounts out to be able to tell.

Using Forex Demo Accounts

A forex demo account is a virtual account that comes with play money that you can make virtual trades with. Forex demo accounts are free of charge and they are supposed to represent actual market conditions. Some forex brokers limit the forex demo account to 30 days of use. A good forex broker allows unlimited use of a forex demo account.

There are a lot of Forex Demo Accounts out there to choose from and you do have to do a little research sometimes to find the right Forex demo account to use as each one varies in complexity and the help that is available. Another variable is how long you can operate your Forex demo account.

There are a just couple of other things to consider when choosing a Forex demo account and these are; size of the account, i.e practice money they give you, and whether they offer real time or close to real time rates.

I guess that all sounds a bit complicated but I can assure you that it really is not.

Using a Forex demo account is a GREAT way to dip your toe in the waters of Forex trading without completely taking the plunge or even worse, taking a bath!

With the right Forex demo account you could quickly grasp the essentials of Forex trading and gain confidence enough to open a live account and start trading for real and the best thing is that they are FREE!

So shop around and see which Forex demo accounts you find suit you best and start practicing and if you don’t find the Forex demo account that works for you then simply close it and find another Forex demo account and try that one out! Visit Here to find Best Forex Demo Accounts and Forex bonus

Regulation

The forex market is an unregulated market meaning there is no central exchange. However, forex brokers themselves are regulated. In the US they should be registered as a Futures Commission Merchant (FCM) with the Commodity Futures Trading Commission(CTFC) and a member of the National Futures Association(NFA). You can verify a broker’s status with the NFA on the NFA web site. If you do not find the broker you are interested in listed with the NFA, look for another broker that is listed and has a clean record.

100% Forex Bonus upto $300

noreply@blogger.com (Learn Forex) — Sat, 12 Dec 2009 07:39:00 +0000

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Demo account is available with virtual money. Once you feel ready to move on for real account, you have a choice - Super Mini account with minimum deposit of $100 and Standard account which allows trading deals up to $5,000,000.

ForexYard forex broker offers 26 trading pairs and fixed dealing spread of 3 pips on EUR/USD. Other major currency pairs are 3-5 pips.

ForexYard has professional eager-to-help representatives to help you on every step, even with demo account. ForexYard customer support knows exactly how to solve the technical issues, but that is not all. ForexYand gives a great support for beginners who want to learn about FOREX market. Their support is given via email, phone and even face to face!

If you prefer to learn about Forex by yourself you may find Forex Training tab very useful. It is located on the website and has a lots of useful information for beginners. And the best part of it all - ForexYard offers a free online full trading course!

Get $20.00 FREE to trade Forex - no deposit required!

noreply@blogger.com (Learn Forex) — Thu, 01 Oct 2009 08:35:00 +0000

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Minimum Deposit -- Bonus Amount -- Required TPoints -- Bonus Code

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$500 --------------- $150 ------------- 150 ----------- FIRST500

$1000 -------------- $200 --------------200 ---------- FIRST1000

$5000 -------------- $1000 ------------1000 ---------- FIRST5000

$10000 ------------ $2000 ------------2500 --------- FIRST10000

*Every instrument gives different TPoints (trader points) per amount traded –CLICK HERE to see the complete table of instruments.

Get up to $1000 on Your First Deposit!

noreply@blogger.com (Learn Forex) — Tue, 29 Sep 2009 13:51:00 +0000

First Deposit Forex Bonus

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About eToro
eToro is an innovative software that has taken the complex world of forex trading and made it user friendly. Countless online forex providers supply their traders with platforms that are bulky and uncomfortable to use. You'll find yourself spending more time trying to figure out how to set up a simple trade than analyzing the market and deciding what your next trade will be. Using a ground breaking interface, the eToro platform puts all the forex tools your heart desires right at your fingertips. eToro is about providing the ultimate forex trading environment for all traders. Here you will not only find a phenomenal array of forex trading tools but also live streaming news, financial event calendars and an unlimited practice mode with live forex rates for you to test out trading arenas before applying them with real money. eToro also combines forex trading with a web 2.0 community centered approach. eToro have created a thriving forex community around public and private chats and forums, that enables you to discuss forex with peers from around the globe, and you can even monitor the most popular pairs traded by eToro’s top 100 ranked traders, and utilize their experience to your advantage !

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Open new forex account and get $30 free

noreply@blogger.com (Learn Forex) — Tue, 29 Sep 2009 09:37:00 +0000

Free $30 Bonus from InstaForex Broker

Online forex broker InstaForex has expended the bonus options for their traders. Apart from free $30 bonus where you need to make a deposit of 100$ , you can now apply for larger bonuses:

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Account Options:

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Bonus:- $30 deposit bonus

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Min. initial deposit:- $1 USD

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InstaForex announced last Friday that it has started a new promotional campaign for the new and old customers, offering free $30 to the newly open trading accounts. That so called «$30 Welcome Bonus» can be given to anyone who opens a new account — both old and new customers are allowed to open an account to participate in this campaign. The bonus can be received only once in 3 month by every trader. Of course, it’s not a huge bonus, specially for those traders that have thousands in their accounts, but it’s a nice gesture that will allow many new traders to try real trading, without risking their own deposit. InstaForex didn’t provide any start or end dates for this promotion (it will be active for the indefinite period of time). But I suggest you to get the advantage from it as soon as possible, so that you could use it sooner again in 3 months.

If you want more information about InstaForex broker go ahead and open a trading account with InstaForex now.

Introduction to Fibonacci trading techniques

noreply@blogger.com (Learn Forex) — Sun, 03 May 2009 11:48:00 +0000

First, a few words about Fibonacci himself…

Leonardo Pisano (nickname Fibonacci) was a mathematician, born in 1170, in Pisa (now Italy). His father was Guilielmo, of the Bonacci family. His father was a diplomat, as a result Fibonacci was educated in North Africa, where he learned "accounting" and "mathematics".

Fibonacci also contributed to the science of numbers, and introduced the "Fibonacci sequence"

The Fibonacci sequence is the sequence 1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144, introduced in his work "Liber abaci" in a problem involving the growth of a population of rabbits.

Aside from this sequence of number where every next number is the sum of the proceeding two, 0, 1 (0+1), 2 (1+1), 3 (2+1), 5 (3+2), 8 (5+3), 13 (8+5), etc.

There are the "Fibonacci ratios".. By comparing the relationship between each number, and each alternate number, and even each number to the one four places to the right, we arrive at some fairly consistent ratios.. The important ones are .236, 50, .382, .618, .764, 1.382, 1.618, 2.618, 4.236, and for good measure we include 1.00 ..

It turns out that the ratios are mathematical principles prevalent in nature around us, and is also in man-made objects. There are many interesting, entertaining, and poetic observations about Fibonacci numbers and ratios in the universe (see the reference section below). Fibonacci numbers appear in ancient buildings, in plants, planets, molecules, the dimensions of human bodies, and of course snails… But of what use is all that to the lowly trader?

What really interests you, the application of Fibonacci techniques in the trading environment..

Prices never move in a straight line. Look at any chart, you will see many wiggles, as price advances and retraces.. Stocks, Futures, Forex, all instruments which are liquid, will often retrace in Fibonacci proportions, and advance in Fibonacci proportions. Not always, and not precisely to the penny. But very often, and reasonably close! This happens often enough that profitable trades can result. I will show you some examples below.

I used Fibonacci ratios with a few simple indicators to help determine probable price turning points, optimum entry, exit and stop-loss levels. My complete techniques are available in on-line video seminars, and in-person seminars. For more details, see the following web page: Click here for details.

The application of Fibonacci to trading can be very complex, and take much time and experience to perfect. Many traders enjoy making the process as difficult and as complex as they can tolerate.. I do the opposite, I try to simplify, try to bring clarity.

Fibonacci example - Microsoft Weekly chart.

This lesson demonstrates a very basic way to use Fibonacci levels. You just read about Fibonacci ratios. We will use just one of those ratios for now, the .382 Fibonacci ratio. In this chart MSFT made a high of (approximately) $59.97 in December of 1999. After that, it moved down to make a low of $30.19 in May of 2000.

Click to see full size chart (zoom) in new window.

Projecting from that low in May, and using a Fibonacci ratio, we can calculate 29.78*.382=$11.37 . So 38.2% of 29.78 is 11.37 . If MSFT were to rally 38.2% of the down-move it would reach $41.57 (11.37+30.20). I'm using rounded numbers in my calculations, the chart above calculates it to be $41.564, we don't need that degree of accuracy!

Several weeks later, MSFT rallied and resisted right near that .382 Fibonacci level !!

So we were able to predict a future probable turning point (after the low of May 2000), using the Fibonacci ratio of .382!! If only it were always so easy.

The steps involved are:

1. Calculate the total value of a significant price-move (high to low, or vice-versa).

2. Calculate a Fibonacci retracement (in this case .382) of the prior move.

3. Look for price to confirm, by resisting (or support in an up-move) near that predicted retracement area.

Fibonacci example - Microsoft Daily chart.

This chart shows how a different Fibonacci level (61.8%) predicted resistance and a market turn.

Notice how the market behaved at the .382 level (30.80 area). Initially the market spiked through, then fell back to that level (late October). We cannot expect a chart to retrace at every Fib level. We can expect some support/resistance as buyers/sellers enter the market at these levels, but we can't always predict whether the market will actually turn at any particular level. Fibonacci techniques are used to alert you to a possible trade, if that price level does cause support or resistance. These techniques are not used as a trigger for entry. Other indicators are used in conjunction with Fibonacci studies to provide higher-probability entries..

Click to see full size chart (zoom) in new window.

As mentioned before, there are several Fib levels, .236, 50, .382, .618, .764, 1.382, 1.618, 2.618, 4.236, and 1.00 .. So there are several places to look for a market turn. They can be calculated in advance, but trading blindly at a fib level can be dangerous, because you never know for certain (in advance) whether the market will turn at any particular Fib level. I use other indicators to help overcome that problem, click here to learn how to determine which Fib ratio is likely to be strong enough to turn the market.

Important notes from this lesson:

1. There are several Fib levels.

2. It takes some skill to determine which Fib level is likely to cause the market to turn.

3. There are some techniques to help you determine where a market is more likely to turn.

4. Do not blindly anticipate a market turn at a Fib level.

More Fibonacci examples.

QQQ Weekly chart with a deep retracement to .618 and a weak attempt to rally after that. However, consider the daily chart and intraday traders. they would have enjoyed the rally from $75 to $100, after going long from a support level that could have been predicted in March!

Click to see full size chart (zoom) in new window.

QQQ daily chart. Multiple Fib levels timing the market perfectly in 3 consecutive waves up!

Click to see full size chart (zoom) in new window.

Intraday chart, QQQ 30-minute. Notice the two market Fib retracements (there are others in this chart too).. The rally from 29.26 stopped at 31.10, then it supported **twice** at 30.39, for two good scalps. The next highlighted Fib support is at a retracement of .618 from the move up 30.47 to 32.49 .. Both of these support levels were predictable before the market supported there.. Hint:--- See how the rally continued after the shallow retracement to 30.39 ... See how the rally after the deeper retracement to .618 near 31.25 was a weaker rally.. This is common, a deeper retracement often foretells a weaker rally... See the next lesson in the table of contents for more on these advanced Fibonacci trading principles.

Click to see full size chart (zoom) in new window.

Another intraday chart, S&P 5-minute.. The first Fib retracement is on a bearish move, an opportunity to short. The second is bullish, with a long entry near 999.25 .. Note that popular charting software will calculate Fibonacci to rediculous precision, we don't need anything closer than one tick! Actually, you should allow some room don't expect precision every time. Allow the trade some room to develop, or you will be stopped out too often.

Click to see full size chart (zoom) in new window.

More Advanced - Microsoft Daily chart.

By now you're probably quite interested, perhaps applying all those Fibonacci ratios to many charts.. You should experiment with your own charts. As long as the instrument traded has a lot of liquidity (not a penny stock for example), you should start to see Fib support and resistance at work. You will start to notice that Fibonacci levels "work" sometimes and not others. Sometimes the trades are not profitable, or are less profitable than others. You need to develop the skills required to select better trades.

In this mini-lesson I want to show you how to evaluate price action based on which Fib levels it responds to, and how the market behaves immediately preceding the Fib support/resistance.

The chart below actually has many Fibonacci levels "performing well", providing support or resistance to the market. I want you to focus on the two that I have identified, for the purposes of this lesson.

Click to see full size chart (zoom) in new window

The first up-move that I have identified topped out at $26.90, and then retraced 61.8% before supporting at that Fib level. There was a pause at the .382 level, but it was not sufficient to hold the market. Now look at the rally from the support level near .618, it rallied but did not exceed the prior high of 26.90 … As a general rule, a retracement to .618 or below indicates that the preceding up-move is losing steam. A shallow retracement which supports at .382 is more likely to rally beyond the prior high than one which has a deep retracement beyond .50 all the way to .618 ..

The impressive thrust from 22.55 up to 26.90 was negated by a quick move back to .618 at about 24.20, so a trader should not be too optimistic about a continuation of the initial up-thrust.

Similarly, the move up in June, from 23.50 to almost 26.50 would also not inspire much optimism for a huge rally above the high of 26.50 … In general a shallow support at .382 would indicate a probable rally beyond the prior high. However, if the up-move preceding the retracement was sluggish rather than thrusting, you also should temper your enthusiasm.

If the second rally which only retraced to .382 had the thrust of the first rally, it would be a more attractive trade!

These are not firm rules, instead they are used as a guide, to help you filter for better trades. Every Fib level is not equal, some are more attractive than others.

Important notes from this lesson:

1. Not all Fib levels are alike.

2. No technical study is perfect, you must develop the skills to filter out bad trades, and improve the odds of finding better trades.

3. Price action just before a Fib retracement can tell you something about the future.

4. Which Fib level causes the end of a retracement also can give a hint to future price action.

5. No technical study is perfect, you must develop the skills to filter out bad trades, and improve the odds of finding better trades.

You can learn more about Neal and his video course by clicking here.

High Probability Trading

noreply@blogger.com (Learn Forex) — Wed, 29 Apr 2009 13:53:00 +0000

This tutorial is provided by Neal Hughes at FibMaster

Even traders with limited experience start to realize that we are not trying to capture every market move. We want to improve our odds and reduce our frustration by filtering, for high-probability trades.

The combination of trend and Fibonacci techniques can provide powerful signals for higher probability trading. We already know that trend-lines have some validity, and so do Fibonacci levels. Combine the two, to improve your chances.

The following charts are the USD/British Pound GBP. First, the daily chart as of October 5th 2005. I have drawn a red down-sloping trend-line joining the two recent swing highs.

The chart has moved down since early September , making a down-trend of consecutive "waves" with lower swing highs and lower swing lows. There were several opportunities to take advantage of the down-move. In this tutorial we will focus on the October 6th opportunity.

In a down-trend we want to short those swing highs, and take profits on swing lows. We don't want to short every time we **think** we have a swing high. If you have tried that, you know about whipsaw and fake-outs already haha. We only want the best trades, those which are more likely to succeed. So how do we choose an optimum entry point?

Our odds are improved if we have a swing high near a down-sloping trend-line (in red on the chart). Markets tend to reverse at Fibonacci levels. So if we have a significant resistance level near a trend-line we have an even better chance of success.

The next chart shows the GBP with Fibonacci resistance levels. Notice the "SK Resistance" level. This represents an area of significant resistance, with a higher probability of a reversal.

If you are new to Fibonacci, those studies look like a confusing series of colored lines. Learning how to use these Fibonacci studies, and which of them are stronger (higher probability), is really easy! I have made two video seminars that explain this. FibMaster .

That "SK Resistance" level, coinciding with a trend-line is an optimum shorting zone. If the market reaches that area (we can't be sure it will), and if the market resists there, we want to take a short position. Once the resistance materializes, it will be difficult for the market to move against us.

Most of us are not trading the daily chart, but we can use the longer-term charts to find **powerful** trends and Fibonacci levels. The next chart is a 60-minute chart. I choose 60-minutes because it clearly shows when resistance has materialized. You may prefer a 30 minute or 5 minute chart.

The following 60-minute chart shows how the Pound rallied to the SK resistance level, and the trend-line. It rallied over those, tested them briefly, then retreated. There are several ways to determine whether resistance has materialized. I have some very powerful techniques for that purpose. However we want this tutorial to focus on some basics. So for now we will use the obvious breaking of the rising trend as our trigger.

During that rally upward, the 60-minute chart has a series of higher swing highs and higher swing lows. Once we broke the highest swing low (see the last bar on the above chart), we know that up-trend has expired. So we want to start shorting rallies and take profits on dips as shown on the next chart (60-minute chart).

Notice how the market broke down, and never looked back! That is what happens when you combine trend-lines with Fibonacci techniques. The best trades go your way and keep on going. That is a characteristic of higher-probability trading.

If this tutorial makes sense, you are ready for Neal Fibonacci Trading videos! My two introductory videos are inexpensive, and they receive glowing reviews almost daily. You can take your trading to the next level, bring these powerful techniques to your trading just by watching my video seminars. FibMaster .

Nagen Multi Time Frame Trading Using Laguerre

noreply@blogger.com (Learn Forex) — Sat, 30 Aug 2008 04:51:00 +0000

Indicators used:

LaGuerre 1 - Gamma 0.55, levels 0.15, 0.85, 0.45 bars to read 9500 color Blue.

LaGuerre 2 - Gamma 0.85, levels 0.15, 0.85, 0.45 bars to read 9500, color Red.

Stochastic Settings: 5, 3, 3 (Green) and 14, 3, 3 (Red)

Recommended - EMA 200 (Red) and EMA 60 (Blue) to find Trend.

Pivot Points: To Find daily Profit levels and as indication of Support / Resistance.

Basic Rules for Entry & Exit

Entry Long:

Laguerre 1: When Laguerre 1 is above 0.15 and pointing up.

Laguerre 2: When Laguerre 2 is moving upward and below 0.50 or below 0.15 (Might follow Laguerre 1).

Stochastic: Both Stochastic should have crossed and be rising above 23.6. Closeness between red and green indicate strong trend.

Moving Average: Trend on 1H window should be above EMA 200 (Red) and EMA 60 (Blue). Here I have mention 1H because I am considering 1H as our trading window.

Exit for Long: When Laguerre 2 goes to top and turns down to 0.85.

************************************************************************

Entry for Short:

Laguerre 1: when Laguerre 1 is below 0.85 and pointing down.

Laguerre 2: When Laguerre 2 is moving downwards and above 0.50 or above 0.85 (Might follow Laguerre 1).

Stochastic: Both Stochastic should have crossed 76.3 levels and moving downwards. Closeness between red and green indicate strong trend.

Moving Average: Trend on 1H window should be below EMA 200 (Red) and EMA 60 (Blue). Here I have mention 1H because I am considering 1H as our trading window.

How to use this method on Multi Time Frame.

Stochastic for Long:

30M should have crossed and be rising above 23.6.
1H should be low in the stochastic range (at least below 50).
4H should be rising and should be above 23.6.

Daily Trend moving upward is indication of success.

Laguerre 1 for Long:

30M should have crossed and be rising above 0.15.
1H should be below 50 and moving upward.
4H should be rising and should be above 23.6.

Daily Trend moving upward is indication of success

Laguerre 2 for Long:

30M should is moving upward and below 0.50 or below 0.15

1H should is moving upward and below 0.50

4H should is moving upward and below 0.85

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Stochastic for Short:

30M should be below 76.3 and pointing down.
1H should be above 50 and moving downwards.
4H should be pointing down and should be below 76.3

Daily Trend moving downward is indication of success.

Laguerre 1 for Long:

30M should have crossed and below 0.85.
1H should be above 50 and moving down.
4H should be pointing downwards and should be below 0.85.

Daily Trend moving upward is indication of success

Laguerre 2 for Long:

30M should is moving downwards and above 0.85 or above 0.85

1H should is moving downward and above 0.50

4H should is moving downwards and above 0.15

**********************************************************

30M setup: Green vertical line indicate Entry and Red line indicate Exit

***********************************************************

1H setup of same currency and same time: Green vertical line indicate Entry and Red line indicate Exit

**************************************************************

4H setup of same currency and same time: Green vertical line indicate Entry

Hope you will Learn Forex and Earn $$$$$ using this strategy. To download indicators used in this strategy Click Here

Forex Trading Strategies

noreply@blogger.com (Learn Forex) — Sat, 29 Sep 2007 13:11:00 +0000

Forex traders almost always rely on analysis to make plan their Forex trading strategies. There are two basic types of Forex analysis – Technical and Fndamental. Here you will find Forex Strategy for both type of analysis.

Technical Analysis Strategy:

Latest: High Probability Trading

For more details, see the following web page High Probability Trading

1: Fibonacci Trading

Traders usually study charts! Fibonacci ratios may be applied to the Price scale, and also to the time scale of charts. I study the price scale. My focus here will be on the price scale for now, perhaps in the future I'll add some time-scale studies.

Prices never move in a straight line. Look at any chart, you will see many wiggles, as price advances and retraces.. Stocks, Futures, Forex, all instruments which are liquid, will often retrace in Fibonacci proportions, and advance in Fibonacci proportions. Not always, and not precisely to the penny. But very often, and reasonably close! This happens often enough that profitable trades can result. I will show you some examples below.

I used Fibonacci ratios with a few simple indicators to help determine probable price turning points, optimum entry, exit and stop-loss levels. For more details, see the following web page Fibonacci Trading

2: Nagen Multi Time Frame using Laguerre

This forex trading strategy depends on multi time frame (5 min, 15 min, 30 min, 1H , 4H etc). Because by using multi time frame you can rectify false trend moves of currency.

Which forex indicator we required?

LaGuerre 1 - Gamma 0.55, levels 0.15, 0.85, 0.45 bars to read 9500 color Blue.

LaGuerre 2 - Gamma 0.85, levels 0.15, 0.85, 0.45 bars to read 9500, color Red.

Stochastic Settings: 5, 3, 3 (Green) and 14, 3, 3 (Red)

Recommended - EMA 200 (Red) and EMA 60 (Blue) to find Trend.
Pivot Points: To Find daily Profit levels and as indication of Support / Resistance.

For more details, see the following web page Nagen Multi Time Frame using Laguerre

3: Stochastic with Fibonacci

Which forex indicator we required?

1) Two stochastic slow indicator with setting Red (14, 3, 3) and Green (5, 3, 3).

2) Fibonacci with level 200, 176.4, 161.8, 150, 138.2, 123.6, 100, 76.4, 61.8, 50, 38.2, 0, -23.6, -38.2, -50, -61.8, -76.4, -100.

3) Three different time Forex chart 30M, 1H and 4H.

Set-up (use GMT 00:00 and 24:00)
Draw Fibonacci line from the previous day's low to the high and draw it so the level lines extend into today (Yesterday is between 0:00 GMT and 24:00 GMT). Always Fibonacci level 0 should be at low and Fibonacci level 100 should at high. Don’t consider market trend while drawing Fibonacci line, just draw from low to high. For more details, see the following web page Stochastic with Fibonacci

4: Short term trade with good accuracy using Stochastic

In this Forex strategy 4H stochastic lead our entry and entry will depend on 15M stochastic.

Here we are going to use elasticity concept. This occurs when 15M Stochastic stretches away from the other 2 Stochastic (1H and 4H) and then snaps back. Here 15M Stochastic goes against the trend and then join the trend. You will understand better you will see example with picture.

What we require?

1: Three Forex chart with different time frame (15M, 1H, 4H) or custom stochastic indicator on 15M chart (download link is below).

2: Stochastic indicator with setting 14, 3, 3

For more details, see the following web page Short term trade using Stochastic Strategy

5: RSI with Stochastic

This is not a Day trading system. Plan to be in positions for multiple days and possibly up to or more than 2 weeks. The goal is to build profitable positions, protect them (with Stop losses) and add more positions simultaneously while keeping your initial risk the same.

I trade the 4 hour and Daily Forex Charts based on momentum. After trial and error (Research n Development) on short term (5min, 15 min, 1hr etc) Forex charts I've found the 4 hour and Daily Forex charts are best for this Forex trading Strategy.

For more details, see the following web page RSI with Stochastic strategy

Fundamental Analysis Strategy:

Fundamental analysis refers to political and economic conditions that may affect currency prices. FOREX traders using fundamental analysis rely on news reports to gather information about unemployment rates, economic policies, inflation, and growth rates.

Fundamental analysis is often used to get an overview of currency movements and to provide a broad picture of economic conditions affecting a specific currency. Most traders rely on technical analysis for plotting entry and exit points into the market and supplement their findings with fundamental analysis. Currency prices on the FOREX are affected by the forces of supply and demand, which in turn are affected by economic conditions.

Technical forex trading strategy focuses on price action and market behavior, especially on chart and technical indicators.

Generally speaking, fundamental forex trading strategy can only judge which direction the market will move, and technical forex trading strategy can supply both direction and rough currency rate., but from my point of view if you are new in Forex trading / you have less time for Forex trading then you should go for Fundamental forex trading strategy using simple forex trading strategy explain here, because by using this forex trading strategy you will know when you have to do Forex trading. But if you have time for Forex trading then you should go for both Fundamental forex trading strategy and Technical forex trading strategy. But for Technical analysis you should know the Basics of Technical Indicator.

For more details, see the following web page Forex Strategy without Technical indicator

Learn Forex Earn Money

Short Term Trade with good accuracy using Stochastic

noreply@blogger.com (Learn Forex) — Sat, 29 Sep 2007 12:34:00 +0000

This Forex strategy is for extremely short term trades to capture small pips (20 +), but its accuracy is very good. Our trades are always depends on stochastic position over multiple time frames stochastic (15M, 1H, 4H). If you need an explanation of stochastic you will not find it here.

In this Forex strategy 4H stochastic lead our entry and entry will depend on 15M stochastic.

Here we are going to use elasticity concept. This occurs when 15M Stochastic stretches away from the other 2 Stochastic (1H and 4H) and then snaps back. Here 15M Stochastic goes against the trend and then join the trend. You will understand better you will see the below example with picture.

What we require?

1: Three Forex chart with different time frame (15M, 1H, 4H) or custom stochastic indicator on 15M chart (download link is below).

2: Stochastic indicator with setting 14, 3, 3

Entry for Long:

Entry: When 4H and 1H are in uptrend, i.e. both are moving up. 4H and 1H stochastic should be above 61.8 level pointing up. Look for elasticity, if you find 15M stochastic against the 4H & 1H Stochastic then look for following condition: - In 15M Stochastic the fast stochastic line crosses above the slow stochastic line below 23.6 level. If all conditions are satisfied go for Long.

Stoploss: It depends on currency you are trading. Just look the history and find appropriate stoploss. 30 – 40 pips will be good.

Exit: When your profit target is hit or 15M Stochastic moves against you.

Example for Long: Here is 15M GBP/JPY Forex chart with modified stochastic indicator. Here thick red line is 4H stochastic (14, 3, 3), thick blue line is 1H stochastic (14, 3, 3), red and green line is 15M stochastic.

Here 4H stochastic is above 61.8 and moving up, 1H stochastic is above 61.8 and moving up. 15M stochastic forms elasticity and goes below 25 level. When 15M fast stochastic line (green) crosses 15M slow stochastic line (red) go for long.

Entry for Short:

Entry: When 4H and 1H are in downtrend, i.e. both are moving down. 4H and 1H stochastic should be below 38.2 level pointing down. Look for elasticity, if you find 15M stochastic against the 4H & 1H Stochastic then look for following condition: - In 15M Stochastic the fast stochastic line crosses below the slow stochastic line above 73.6 level. If all conditions are satisfied go for Short.

Stoploss: It depends on currency you are trading. Just look the history and find appropriate stoploss. 30 – 40 pips will be good.

Exit: When your profit target is hit or 15M Stochastic moves against you.

Example for Short: Here is 15M GBP/JPY Forex chart with modified stochastic indicator. Here thick red line is 4H stochastic (14, 3, 3), thick blue line is 1H stochastic (14, 3, 3), red and green line is 15M stochastic.

Here 4H stochastic is below 20 level and moving down, 1H stochastic is below 20 and moving down. 15M stochastic forms elasticity and goes above 73.6 level. When 15M fast stochastic line (green) crosses 15M slow stochastic line (red) go for Short.

You can download the modified stochastic indicator HERE (it work well on 15M chart, don’t try on other time frame it might give you wrong reading). If your Forex trading platform doesn’t support custom indicator don’t bother, you can apply same Forex Strategy with normal stochastic indicator using different timeframe Forex chart.

Best currency to trade using this indicator.

GBP/JPY, EUR/JPY, USD/JPY, GBP/USD

Reverse Stochastic with Fibonacci

noreply@blogger.com (Learn Forex) — Sat, 29 Sep 2007 04:28:00 +0000

Every Forex trader know the power of Fibonacci numbers and Stochastic in Forex Market, both are very popular and powerful indicator in the Forex market. Here we are going to combine both to make them more powerful.

What we required?

1) Two stochastic slow indicator with setting Red (14, 3, 3) and Green (5, 3, 3).
2) Fibonacci with level 200, 176.4, 161.8, 150, 138.2, 123.6, 100, 76.4, 61.8, 50, 38.2, 0, -23.6, -38.2, -50, -61.8, -76.4, -100.
3) Three different time Forex chart 30M, 1H and 4H.

Set-up (use GMT 00:00 and 24:00)
Draw Fibonacci line from the previous day's low to the high and draw it so the level lines extend into today (Yesterday is between 0:00 GMT and 24:00 GMT). Always Fibonacci level 0 should be at low and Fibonacci level 100 should at high. Don’t consider market trend while drawing Fibonacci line, just draw from low to high.

Entry (Use 1H for identify Entry)

Long: Look for the price to break the 100 level of the Fibonacci not just touches it. At the same time both or (14, 3, 3) stochastic should be above 76.4 level. If the above conditions are fulfilled then check 30M and 4H chart and if both are above / near 76.4 then it is best. At least 4H should be above / near 76.4.

Stop for Long: Set the stop at the 50, 38.2, 23.6 or 0 level with 3-5 pips extra and add your spread in. I recommend the 23.6 level or 38.1 level but it depends on the pips involved.

Exit for Long: Always exit from long trade at breakout of 200 Fibonacci level or when stochastic 14, 3, 3 crosses back 76.4 downside.

Examlpe: Here is 1H Forex Chart

This is 30M Forex Chart

Here is 4H Forex Chart

Short: Look for the price to break the 0 level of the Fibonacci not just touches it. At the same time both or (14, 3, 3) stochastic should be below 23.6 level. If the above conditions are fulfilled the check 30M and 4H chart and if both are below / near 23.6 then it is best. At least 4H should be below / near 23.6.

Stop for Short: Set the stop at the 50, 61.8, 76.4 or 100 level with 3-5 pips extra and add your spread in. I recommend the 61.8 level or 76.4 level but it depends on the pips involved.

Exit for Short: Always exit from short trade at breakout of -100 level or when stochastic 14, 3, 3 crosses back 23.6 upside.

Fundamental Analysis

noreply@blogger.com (Learn Forex) — Fri, 28 Sep 2007 20:14:00 +0000

Usually everyday, the Forex currency pair will be moving along slowly (sideways movement, consolidation) and then all of a sudden it JUMPS! It very quickly moves up 30 or more pips, usually in just a minute, and often continues to move strongly for another hour or so. Why? This is due to the release of a “Fundamental Announcement".

Example: Below is picture of GBP/USD 1-minute chart, Forex Chart Server time is GMT + 3. Here you can see on 18/9/2007 at 21:14 price was near 1.9995 and at 21:15 after US FOMC Interest Rate announcement Price started to moving up and in 3 minute it was at 2.0095.

Fundamental analysis? What is this? Fundamental analysis refers to political and economic conditions that may affect Forex currency prices. FOREX traders using fundamental analysis rely on news reports to gather information about unemployment rates, economic policies, inflation, and growth rates.

Various news is released by government and academic sources. They are reliable measures of economic health and are followed by all sectors of the investment market. News is usually released on a monthly basis but some are released weekly.

Some most important fundamental indicators / news are Interest Rates, Non Farm Payroll (NFP), Unemployment Reports and International Trade. Also high on the list to look for are Consumer Price Index (CPI), Inflation, and Gross Domestic Product (GDP). Also keep your eye on M2 Money Supply, Treasury Budget, Producer Price Index (PPI), and Retail Sales.

Interest Rates - can have either a strengthening or weakening effect on a particular currency. On the one hand, high interest rates attract foreign investment which will strengthen the local currency. On the other hand, stock market investors often react to interest rate increases by selling off their holdings in the belief that higher borrowing costs will adversely affect many companies. Stock investors may sell off their holdings causing a downturn in the stock market and the national economy.

International Trade – Trade balance which shows a deficit (more imports than exports) is usually an unfavourable indicator. Deficit trade balances means that money is flowing out of the country to purchase foreign-made goods and this may have a devaluing effect on the currency. Usually, however, market expectations dictate whether a deficit trade balance is unfavourable or not. If a county habitually operates with a deficit trade balance this has already been factored into the price of its currency. Trade deficits will only affect currency prices when they are more than market expectations.

CPI -- a measurement of the cost of living.

PPI -- a measurement of the cost of producing goods.

GDP -- measures the value of all goods and services within a country,

M2 Money Supply -- measures the total amount of all currency.

Ok Now you know about fundamental analysis, you know after important announcement Forex market can suddenly jumps to many pips within a minute, BUT in which direction you should go? And imagine that it’s 5:59 am, and the price on GBP/USD is at 1.9600. At 6:00 am, we have UK Retail Sales scheduled that are expected to read 0.6%. Imagine, the retail sales read 1.0%, and you feel that it’s good for the pound, so you click on the button to buy GBP/USD at 1.9600, except instead of filling you at 1.9600; your broker slips you and fills you at 1.9640. You got filled at the very top of the spike, you see price retracing now, you get scared, and exit with a loss, and you wonder what happened. Well, what happened is what happens with almost every important news announcement. There is a big spike that happens in the first 5 to 15 seconds, because so many people are trying to go in the same direction. Then traders realize that the market over-reacted, so they close their positions in loss.

Now here is simple trick to avoid this situation.

First you need real time chart, If you have then it’s cool, if not then you can get here and also get $5 free to open free account Win n Win situation. Now go here and view Fundamental Announcements calendar to see what is scheduled to come up for tomorrow weekdays not weekends and note down all important Forex news. Some days you will have more announcements, some days you will have less. But, the more announcements scheduled for a particular country at the same time the more likely you will see some interesting price action.

Before continue you will need to know what your time zone is in relation to GMT (Greenwich Mean Time), as most announcements are published according to this time zone. Visit here to convert GMT to your country time.

Now, consider in announcement calendars you find that the US will be making some announcements at 9:30am tomorrow. Then at 9:20 am you should be in front of your computer with your Forex charts open to the one-minute or five-minute candlesticks for GBP/USD, and ready to place an order.

Now at 9:25 look at 9:20 5 minute bar and you need to look at the candle and see what the high and low prices are (not open and close). Here place Buy / Long order at plus10 pips to the high price and Sell / Short order at minus 10 pips from the low price. And you should place StopLoss of 20 to 25 pips. Within 5 minutes one of your two trades should be off and running. At this point you should cancel the other trade, if nothing happened within 5-8 minute after announcement just cancel both order and prepare for next fundamental announcement.

Best day to trade:
First Friday of every month, because US announce multiple news on first friday - This month result Here

Best currency to trade:
1) For US and UK announcement USD/CHF, USD/JPY, GBP/USD.
2) For Canada announcement USD/CAD.
3) For Europe announcement EUR/USD.

Forex Collection 3

noreply@blogger.com (Learn Forex) — Sat, 01 Sep 2007 20:42:00 +0000

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Understanding Forex Indicator and Determining Forex Signal.

noreply@blogger.com (Learn Forex) — Wed, 08 Aug 2007 10:48:00 +0000

Here we are going to discuss about seven most important Forex Indicator.

1. Average Directional Movement Index (ADX) - ADX is used when we need to know the direction in which the Forex market trend is going i.e. either downward or upward and how strong the Forex trend is. When ADX readings over 25 indicate a Forex trend with higher values indicating stronger Forex trends. For more ADX detail scroll down the page.

2. Moving Average Convergence/Divergence (MACD). MACD shows the momentum of a Forex market and the relationship between two moving averages. When, for example, the MACD line crossings of the signal line it indicates a strong Forex market. click here for details.

3. Stochastic Oscillator- Stochastic Oscillator indicates the strength and weakness of a Forex market by comparing a closing Forex Market price range over a period of time. Stochastic reading above 80 depicts the Forex currency is overbought while its reading below 20 indicates that the Forex currency is oversold. click here for details.

4. Relative Strength Indicator (RSI). RSI is a scale from 0 to 100 which indicates the highest and lowest Forex prices over a given time. When prices rise above 70 the Forex currency is considered to be overbought while a Forex Market price below 30 would indicate a Forex currency which is oversold. click here for details.

5. Moving Average- Moving average Forex indicator is the average Forex Market price for a
given time interval in relation to other prices during the similar time periods. For instance the closing prices over a 5-day period would have a moving average of the total of the five closing prices divided by five. click here for details.

6. Bollinger Bands. Bollinger bands are bands that contain the majority of a currency's price. Each band consists of three lines - the upper and lower lines indicate the price movement with the middle line showing the average Forex Market price. In conditions of high volatility the gap between the upper and lower bands will widen. If a bar or candlestick touches one of the bands then it will indicate either an overbought or an oversold condition. click here for details.

7. Fibonacci Indicator : The Fibonacci sequence is the sequence 1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144, introduced in his work "Liber abaci" in a problem involving the growth of a population of rabbits.

Aside from this sequence of number where every next number is the sum of the proceeding two, 0, 1 (0+1), 2 (1+1), 3 (2+1), 5 (3+2), 8 (5+3), 13 (8+5), etc.

There are the "Fibonacci ratios".. By comparing the relationship between each number, and each alternate number, and even each number to the one four places to the right, we arrive at some fairly consistent ratios.. The important ones are .236, 50, .382, .618, .764, 1.382, 1.618, 2.618, 4.236, and for good measure we include 1.00 ..

It turns out that the ratios are mathematical principles prevalent in nature around us, and is also in man-made objects. There are many interesting, entertaining, and poetic observations about Fibonacci numbers and ratios in the universe. click here for details.

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First start with Average Directional Movement Index (ADX):
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J. Welles Wilder developed the Average Directional Index (ADX) to evaluate the strength of a current trend, be it up or down. It's important to determine whether the market is trending or trading (moving sideways), because certain indicators give more useful results depending on the market doing one or the other.

There are three lines in the indicator graph, a trend following line, a positive directional line (+DI) and a negative directional line (-DI). The Blue line tracks trends, the green line (+DI) is a signal to go long and the red line (-DI) is a signal line to go short. What we do is to wait for the blue line (trend line) to rise from below 20 to above 20. That means a trend is being developed.

The simplest trading method based on the system of directional movement implies comparison of two direction indicators: the 14-period +DI one and the 14-period -DI. When the green line (+DI) crosses above the red line (-DI), it is a signal to go long. And vise versa, when the red line (-DI) crosses above the green line (+DI), it is a signal to go short.

Try to combine it with parabolic SAR and you’ll get great result on your trades.

You can use this technique for any currency at any time frame. We have to use Parabolic SAR with default settings (0.02, 0.2) and ADX 50 (with +DI, -DI lines).

Entry Rules for Short: Sell When the +DI line (Green) is below the -DI line (Red), and Parabolic SAR gives sell signal. When the +DI line (Green) is above the -DI line (Red), all Parabolic sell signals must be ignored.

Entry Rules for Long: Buy when the +DI line (Green) is above the -DI line (Red), and Parabolic SAR gives buy signal. When the +DI line (Green) is below the -DI line (Red), all Parabolic buy signals must be ignored.

Exit rules: when +DI line (Green) and -DI lines (Red) have crossed again.

Note: Blue cross indicate not to enter Forex Market. See rule above.

Click Here for Next >> MACD >>

How to Draw a Forex TrendLine

noreply@blogger.com (Learn Forex) — Thu, 05 Jul 2007 22:29:00 +0000

What is Trend?

In Forex trend is your Friend. A Trend refers to the direction of Forex Market Prices. Rising peaks and through constitute an up trend, falling peaks and through constitute a downtrend that determines the steepness of current trend. The breaking of a trend line usually signals a trend reversal.

Plotting a trend line on a Forex chart gives very valuable information. It helps to determine good entry and exit points, best positioning for profit taking and placing protective stops. But difficulty arises because of the time factor. Whenever we talk of trend it has to be related to the context of time.

An intraday (relates to action on that particular day only) Forex Market Price chart may show a significant trend, which is different to a trend recognizable on a daily Forex Market Price chart, which may be different to a trend on a weekly chart.

Success depends on recognizing and trading the appropriate trend. Successful investing depends on recognizing the short, medium or long-term trend and their correction (Rallies and Dips) inside the larger trend. We will usually be trading when at least the short term and intermediate term trends are in the same direction. The ideal will be when all three trends are in unison, but this is not a prerequisite, as intermediate trends can be substantial in both time and Forex Market Price.

A trend line confirms its validity when the Forex Market Price respects this line. The more times Forex Market Prices touches and bounce back, the stronger it becomes.

Broken trend line will warn us of a possible reverse of the trend. A trend line is considered broken when a full bar body has completely formed on the other side of the line. It is not broken when the Forex Market Price just pierced the trend line.

How to draw a Trend line?

A trend line is a straight line that connects two important lowest low (Low Open/Close) or highest highs (High Open/Close) points in the chart. It should be noted that a trend line should not intersect other Forex Market Prices between these two points. Any amount of secondary and small trends can be found within the main trend because sometime our trend line will need to be readjusted to the current Forex Market Price moves. Do so, but consider your old trend line to be valid for some period of time. It can still serve you well.

First understand few things about candlestick chart. In below picture you can see what represent High / Low Open and High Close / Low Close.

Now, let’s see the chart below. This is EUR/CHF at Hourly time scale: (I deleted some part of the picture to help you understand the concept)

In the Up Trend, Forex trend line that connects at least two lowest low (Low open/Close) will create a trend line. In the uptrend a trend line acts as Support.

Broken trend line will warn us of a possible reverse of the trend. A trend line is considered broken when a full bar body has completely formed on the other side of the line. It is not broken when the Forex Market Price just pierced the trend line. In below picture Forex Market Prices broke our trend line at red square and start falling down.

Similarly we can draw trend line for downtrend. In the Down Trend Forex trend line that connects at least two highest highs (High Open/Close) will create a trend line. In the downtrend a trend line acts as Resistance.

In below picture price broke our trend line at red square and start moving up.

Remember this: To draw a trend line, it is enough to have two points it to be drawn through, and one more point to confirm the trend.

Forex Trading Strategy

noreply@blogger.com (Learn Forex) — Tue, 05 Jun 2007 06:11:00 +0000

If you want to earn profit in Forex Trading then you should be able to find,

1: Exact entry point as early as possible.

2: Exit point as early as possible.

Here I am going to discuss about a system which will give you exact entry point. This is not a Day trading system. Plan to be in positions for multiple days and possibly up to or more than 2 weeks. The goal is to build profitable positions, protect them (with Stop losses) and add more positions simultaneously while keeping your initial risk the same.

I trade the 4 hour and Daily Forex Charts based on momentum. After trial and error ( Research n Development) on short term (5min, 15 min, 1hr etc) Forex charts I've found the 4 hour and Daily Forex charts are best for this Forex trading Strategy.

In this Forex trading system we are going to use,

1: 150 SMA (Simple Moving Average)
2: Slow Stochastic Oscillator with settings 6, 3, 3
3: RSI (Relative Strength Indicator) with setting 3
4: Parabolic SAR with default settings (0.02, 0.2)
5: Any currency with Daily Time frame

Before continue you should know how these Forex indicator works, Please Visit Here for more details about Forex Technical Indicators.

Now take a look at blow picture, it is GBP/JPY daily forex chart, this trick work very well on daily time frame therefor please use daily chart.

Now apply all Forex indicator mention above on this chart, now it will look like below chart,

Now, I am going to explain how to use these Forex indicators to find exact entry point and exit point. Now take a look at below picture.

Entry for Uptrend: when the price is above 150 SMA, RSI is below 25, Slow Stochastic is below 25 and Slow Stochastic lines crossover occur - Enter Long with a new price bar. If at least one of the conditions is not met - stay away.

Note: Don’t consider Parabolic SAR at the time of entry, we use it for Exit.

Exit for Uptrend: A stop is placed below the previous bar's lowest price and is moved with each new price bar. OR using Slow Stochastic, RSI and Parabolic SAR – when first Stochastic lines cross above 70, RSI is above 75 and Parabolic SAR gives sell signal (i.e. RED dot above price bar).

Entry for Downtrend: when the price is below 150 SMA, RSI is above 75, Slow Stochastic is above 75 and Slow Stochastic lines crossover occur - Enter Long with a new price bar. If at least one of the conditions is not met - stay away.

Note: Don’t consider Parabolic SAR at the time of entry, we use it for Exit.

Exit for Downtrend: A stop is placed above the previous bar's highest price and is moved with each new price bar. OR using Slow Stochastic, RSI and Parabolic SAR – when first Stochastic lines cross above 25, RSI is above 20 and Parabolic SAR gives Buy signal (i.e. RED dot below price bar).

I hope this will help you.

Click Here >> Trading trick using Fibonacci indicator>>

Forex Collection 2

noreply@blogger.com (Learn Forex) — Thu, 17 May 2007 07:31:00 +0000

1: www(.)ac-markets(.)com - Currency trading - Forex Trading with The Forex Broker. ACM offers online currency trading commission-free, tax-free, lowest forex spreads on the market, guaranteed fills, real-time one-click execution. Free forex charts, foreign exchange rates, forex news & analysis.

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Forex Collection 1

noreply@blogger.com (Learn Forex) — Wed, 16 May 2007 15:13:00 +0000

1: www(.)surefire-forex-trading(.)com - Forex Trading - www.surefire-forex-trading.com/ Learn to trade the fx market with a proven forex trading method.

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Blog Directory

How to Determine Support and Resistance.

noreply@blogger.com (Learn Forex) — Sun, 13 May 2007 06:54:00 +0000

What Is Support?

Support is the price level at which demand is thought to be strong enough to prevent the Forex Market price from declining further. The logic dictates that as the Forex Market price declines towards support and gets cheaper, buyers become more inclined to buy and sellers become less inclined to sell. By the time the Forex Market price reaches the support level, it is believed that demand will overcome supply and prevent the Forex Market price from falling below support. Support levels are usually below the current Forex Market price.

Note: When Support level is broken, then technically it will become Resistance level. And vice versa.

What is Resistance?

Resistance is the price level at which selling is thought to be strong enough to prevent the Forex Market price from rising further. The logic dictates that as the Forex Market price advances towards resistance, sellers become more inclined to sell and buyers become less inclined to buy. By the time the Forex Market price reaches the resistance level, it is believed that supply will overcome demand and prevent the Forex Market price from rising above resistance. Resistance levels are usually above the current Forex Market price.

Note: When Resistance level is broken, then technically it will become Support level. And vice versa.

There are loads of ways in determining support and resistance level. In this section, we’re going to discuss about the two ways. First: Using Forex Market Price chart and past Forex Market Price history. Second: Using Pivot Points.

The first method of determining support and resistance levels is to look at a bar chart and its past price history and then see at what Forex Market price levels the highs, lows and closes seem to be touching the most. This method of determining support and resistance levels works on any bar chart time frame--hourly, daily, weekly or monthly.

Now, let’s see the chart below. This is GBP/USD at 15M of time scale: (I deleted some part of the picture to help you understand the concept)

Let’s start from 27/04/2007 8:00 PM. You know the definition of support and resistance, then we might draw first support level at 1.9922 because market Forex Market price couldn't break below this level.

Now, we have resistance level at 2.0039, where Forex Market price didn’t go up further than that level

And now, take a look at what happened on 30/04/2007 between 4:30AM and 8:15 AM, Forex Market Price move Upward and give us a new resistance level at 1.9969.

And now, take a look at what happened on 30/04/2007 near 12:15 PM, Forex Market price broke below our support level at 1.9922 and our support level was no longer considered to be support level. It became resistance level. (When resistance level is broken, then technically it will become support level. And vice versa, when support level is broken, then technically it will become resistance level. )

Here we got new Support level at 1.9890, because Forex Market price couldn’t break below this level.

Again, take a look at what happened on 30/04/2007 near 12:30 PM, Forex Market Price broke below our resistance level at 1.9922 and our resistance level was no longer considered to be resistance level. It became support level. (When resistance level is broken, then technically it will become support level. And vice versa, when support level is broken, then technically it will become resistance level. )

And so on, we’ll have support and resistance levels like picture below. Again look at horizontal lines 1.9969 and 1.9988, it was resistance line, but Forex Market Price broke above our resistance and it became support level. Flag indicate respects to our support / resistance line (A line confirms its validity when the price respects this line. The more times Forex Market Price touches and bounce back, the stronger it becomes.)

Remember this Rule:

“When resistance level is broken, then technically it will become support level. And vice versa, when support level is broken, then technically it will become resistance level.”

Moving Average and Bollinger Bands

noreply@blogger.com (Learn Forex) — Tue, 08 May 2007 23:10:00 +0000

Moving Average:

Moving averages are one of the most popular and easy to use tools available to the technical analyst. Moving average Forex indicator is the average price for a given time interval in relation to other prices during the similar time periods. For instance the closing prices over a 5-day period would have a moving average of the total of the five closing prices divided by five.

The two most popular types of moving averages are the Simple Moving Average (SMA) and the Exponential Moving Average (EMA).

A Simple moving average is calculated by adding the prices over a given number of periods, then dividing the sum by the number of periods. For example, a nine-day simple moving average would add together the closing prices for the last nine days, and then divide that number by nine.

An Exponential moving average gives more weight to recent prices, and is calculated by applying a percentage of today's closing price to yesterday's moving average. The longer the period of the exponential moving average, the less total weight is applied to the most recent price. The advantage to an exponential average is its ability to pick up on price changes more quickly.

How to use?

If the price rises above the moving average it can be considered a bullish signal, and if the price dips below the moving average, it can be considered a bearish signal. This "crossover" or "penetration" will not be at the top or bottom, but normally shortly after the price bottoms out or tops out.

Longer-term and shorter-term moving averages can be compared to each other, and generate signals when they cross. When a shorter term MA moves across a longer term MA and both slopes go up, it can be considered a bullish signal. When a shorter term MA moves across a longer term MA and both slopes go down, it's can be considered a bearish signal.

An Example of using Longer-term and shorter-term moving averages to generate signals.

You can use this technique for any currency at 1H or 1 Day time frame. We have to use 7 SMA (Green Line), 14 SMA (Red Line), and 21 SMA (Blue Line).

Entry Rules for Short: Sell when 7 SMA (Green Line) goes through 14 SMA (Red Line) and continues through 21 SMA (Blue Line) in downward direction.

Entry Rules for Long: BUY when 7 SMA (Green Line) goes through 14 SMA (Red Line) and continues through 21 SMA (Blue Line) in upward direction.

Exit rules: Exit when 7 SMA (Green Line) goes back and touches 21 SMA (Blue Line).

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Bollinger Bands:

Developed by John Bollinger, Bollinger Bands are considered some of the most useful bands in technical analysis, for they vary in distance from the moving average of a Forex Market Price based on the security's volatility and relative price levels over a period time. The indicator consists of three bands designed to encompass the majority of a Forex Market Price action.

A simple moving average in the middle
An upper band (SMA plus 2 standard deviations)
A lower band (SMA minus 2 standard deviations)

During periods of increased fluctuation, the bands widen to take this into account, and when the fluctuation decreases, the bands are tapered for a narrower focus to the price range. The upper band is the standard deviation multiplied by a given factor above the simple moving average, and the lower band is the standard deviation multiplied by the same given factor below the simple moving average.

How to use?

In addition to identifying relative price levels and volatility, Bollinger Bands can be combined with price action and other indicators to generate signals and foreshadow significant moves.

Example:

You can use this technique for any currency at 1H or 30M time frame. We have to use 14 EMA (Green Line), 21 EMA (Red Line), 50 EMA (Blue Line) , Bollinger Band (20, 2) (Brown and Yellow Lines).

Entry Rules for Short: if 14 EMA (Green Line) is below 21 EMA, then if both 14 EMA (Green Line) and 21 EMA (Red Line) are below 50 EMA (Blue Line), then if 50 EMA (Blue Line) is within the Bollinger Bands borders (Brown and Yellow Lines).

Entry Rules for Long: BUY if 14 EMA (Green Line) is above 21 EMA (Red Line), then if both 14 EMA (Green Line) and 21 EMA (Red Line) are above 50 EMA (Blue Line), then if 50 EMA (Blue Line) is within the Bollinger Bands borders (Brown and Yellow Lines).

Exit rules: Exit when any of the conditions is violated.

Relative Strength Indicator (RSI) & Stochastic Oscillator

noreply@blogger.com (Learn Forex) — Tue, 08 May 2007 21:55:00 +0000

Relative Strength Indicator (RSI):

Relative Strength Index (RSI), an oscillator introduced by J. Welles Wilder. The RSI is based upon the difference between the average of the Forex closing price on up days vs the average closing price on the down days over a given period, and is plotted on a vertical scale of 0 to 100.

Wilder advocated a 14-day RSI, although shorter and longer periods have gained popularity when the market exhibits certain characteristics. Generally, RSI is measured in a period between 5 and 25.

How to use it?

Wilder recommended using 70 and 30 and overbought and oversold levels respectively. Generally, Forex Buy signals are triggered when RSI is in oversold (20-30) area, potentially meaning that the stock is about to reach its low for this trend, and Forex Sell signals are triggered when RSI is in overbought (70-80) area, potentially signaling a Forex market top.

Try to combine it with EMA and you’ll get great result on your trades.

You can use this technique for any currency at 1 Day time frame. We have to use 5 EMA (Green Line), 12 EMA (Red Line), and RSI 21.

Entry Rules for Short: Sell when 5 EMA (Green Line) crosses down and below 12 EMA (Red Line) and RSI is below 50.

Entry Rules for Long: Buy when 5 EMA (Green Line) crosses up and over 12 EMA (Red Line) and RSI is above 50.

Exit rules: Exit when 5 EMA (Green Line) and 12 EMA (Red Line) cross again or when RSI crosses back through 50.

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Stochastic Oscillator:

The Stochastics oscillator, a popular and dynamic indicator developed by Dr. George Lane, is based on the premise that during an upward trading Forex market, Forex prices tend to close near their high and during a downward trading market, Forex prices tend to close near their low.

Typically used to identify overbought and oversold conditions the indicator consists of two lines: % K and %D. The range of the Stochastics is between 0 and 100. With a price range of ten to twenty, ten would be given a 0 designation, fifteen would be at 50, and a price of twenty would be at the 100th percentile. The values of the stochastics calculations are dependent on the parameters given to %K and %D.

Readings below 20 are considered oversold and readings above 80 are considered overbought. However, Lane did not believe that a reading above 80 was necessarily bearish or a reading below 20 bullish. A Forex Market Price can continue to rise after the Stochastic Oscillator has reached 80 and continue to fall after the Stochastic Oscillator has reached 20. Lane believed that some of the best signals occurred when the oscillator moved from overbought territory back below 80 and from oversold territory back above 20.

How to Use?

When the faster %K line crosses above the slower %D line and the lines are below 20, a Forex buy signal is generated. When the %K lines crosses below the %D line and the lines are above 80 a Forex sell signal is generated.

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Calculating Forex Profits and Losses.

noreply@blogger.com (Learn Forex) — Sat, 05 May 2007 22:18:00 +0000

A Guide To Calculating Forex Profits and Losses.
By David Shephard

The first thing that the newcomer to the world of Forex needs to realize is that in Forex trading currencies are traded in much smaller divisions than is the case for normal cash transactions. Although the smallest cash division in the US is the penny (US $0.01), US currency can be traded on the Forex market in divisions of as low as US $0.0001. This smallest division is known as the pip, which is short for Price Interest Point and is also sometimes referred to as 'points'.

As currencies are traded in large lots (typically US $100,000), small movements in the value of the currency can produce substantial profits and losses. For example, in a lot of US $100,000 one pip is worth $10 so an increase of just 40 pips (or 4/10 of one cent) can generate a profit or loss of US $400.

Although the standard lot in Forex trading is 100,000 units of the base currency, currencies can be traded in lots of various sizes. When talking about a lot, the term ‘unit' is the currency name, so that for the US dollars one unit is one dollar.

Different currencies also have different sized pips. The US dollar, for example, is expressed in pips of 0.0001 while the Japanese yen is expressed in pips of 0.01. The value of a pip will depend on the currency pair being traded and the size of the lot. Currency pairs involving the US dollar (USD) with USD as the quote, or second, currency (for example CAD/USD) always have a pip value of $10 for a standard lot. For other currencies a pip value calculator should be used.

There are various different types of order that can be placed by a Forex trader and these order types will have an effect on the profit of loss made in each transaction.

Market Order. A market order is an order to buy or sell at the current market price and be used to either enter or exit a trade. Market orders need to be used carefully because, in fast-moving markets, there can be a significant difference between the price displayed at the time a market order is made and the actual price when the transaction is made. This gives rise to slippage, which is the amount by which the market moves in the time (often just a few seconds) between placing an order and its execution. Slippage can result in a gain or loss of several pips.

Limit Order. A limit order is an order to buy or sell when a certain limit is reached. Limit orders are often used to either buy a currency below the market price or to sell a currency above the market price. If you are buying, your order is executed only when the market falls to the price stated in your limit order. Similarly, if you are selling, your order is executed when the market rises to the price specified in your limit order. In the case of limit orders there is no slippage.

Stop Order. A stop order is an order to buy above the market or to sell below the market. They are most frequently used as stop-loss orders to limit losses if the market moves against the trader's expectation. A stop-loss order will sell the currency if the market falls below the point set by the trader.

One Cancels the Other (OCO). An OCO order is used when placing a limit order and a stop-loss order at the same time and simply means that if either order is executed the other is cancelled. This is useful as it allows a trader to make a transaction without having to monitor the market. Should the market fall, the stop-loss order will be executed, but if the market rises to the level specified in the limit order, the currency will be sold at a profit.

Here is an example of an OCO Transaction:

Buy: 1 standard lot EUR/USD @ 1.3248 = $132,480

Pip Value: 1 pip = $10

Stop-Loss: 1.3223

Limit: 1.3348

This is an order to buy US dollars at 1.3348 and to sell them if they fall to 1.3223 (resulting in a loss of 25 pips or $250) or to sell them if they rise to 1.3348 (resulting in a profit of 100 pips or $1,000).

Let's look at another example:

The current bid/ask price for US dollars and Canadian dollars is

USD/CDN 1.2152/57

This means that you can buy $1 US for 1.2152 CDN or sell 1.2157 CDN for $1 US.

Now, if you believe that the US dollar is undervalued against the Canadian dollar, you will buy US dollars (at the same time selling Canadian dollars) and wait for the US dollar to rise.

Here is the transaction:

Buy USD: 1 standard lot USD/CDN @ 1.2157 = $121,570 CDN

Pip Value: 1 pip = $10

Stop-Loss: 1.2147

Margin: $1,000 (1%)

In this standard lot transaction you are buying US $100,000 and selling CDN $121,570. If the price of the dollar falls below then your stop-loss order will be executed and you will lose $100.

However, let's assume that the USD/CDN rises to 1.2192/87. You may now sell US $1 for CND $1.2192 or sell CDN $1.2187 for US $1.

Because you entered the transaction by buying US dollars, you must now sell US dollars and buy back Canadian dollars to realize your profit. So, you sell US $100,000 at the current USD/CDN rate of 1.2192, and receive CDN $121,920 for which you originally paid CDN $121,570. Your profit is CDN $350 or US $287.19 (350 divided by the current exchange rate of 1.2187).

About Author:
To learn Forex trading online and to look at the possibility of opening your own mini forex online account please visit ForexOnlineTradingSystem.info
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MACD Chart

noreply@blogger.com (Learn Forex) — Thu, 05 Apr 2007 10:23:00 +0000

Moving Average Convergence Divergence ( MACD ) Charts

MACD was originally constructed by Gerald Appel an analyst in New York. It is one of the simplest and most reliable indicators available.

The MACD is basically a refinement of the two moving averages system and measures the distance between the two moving average lines.

MACD Indicator normally shows up as two lines (MACD line and Signal Line) plotted on an open scale against the zero line. These two lines will normally be of different color or one line a solid line and the other a dotted line. Forex Signals are taken when MACD crosses its signal line.

The most popular formula for the "standard" MACD is the difference between a Forex Market prices 26-day and 12-day Exponential Moving Averages (EMAs), for this you should set indicator settings to 12 and 26 period exponential moving averages with 9 period exponential moving average as the signal line.

How to use MACD?

When the MACD falls below its signal line, it can be considered a sell signal. Similarly, a Forex buy signal can be interpreted when the MACD rises above its signal line. It is also used as an overbought and oversold indicator. The higher above the zero both lines are the more overbought it becomes and the lower below the zero line both lines are the more oversold it becomes. It may also lead to a stronger Forex signal if the signal line crosses down when it is overbought and crosses up when it is oversold.

When the MACD is making new highs or lows, and the price is not also making new highs and lows, it signals a possible trend reversal and this can be verified with an overbought/oversold oscillator like RSI or Stochastic Oscillator.

Try to combine it with parabolic SAR and you’ll get great result on your trades.

You can use this technique for any currency at any time frame. We have to use Parabolic SAR with default settings (0.02, 0.2) and MACD with 12,26,9

Entry Rules for Short: Sell When Parabolic SAR gives sell signal and MACD falls below its signal line

Entry Rules for Long: Buy when Parabolic SAR gives buy signal and when the MACD rises above its signal line.

Exit rules: At the next MACD lines crossover or if the market starts trading sideways for some time.

Note: Green cross indicate not to enter Forex Market because MACD had not confirmed it and blue check mark indicate enter to market

Click Next>> Scothastic Oscillater & RSI >>

Trading Techniques / Tricks

noreply@blogger.com (Learn Forex) — Thu, 05 Apr 2007 10:17:00 +0000

Fibonacci Trading

Leonardo Fibonacci da Pisa was a prominent mathematician and is credited with the discovery of what we now call the Fibonacci series. Those ratios appear from the next numbers: 0, 1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144, 233, ..., and according to these calculations: 1+2=3, 2+3=5, 3+5=8 etc.

The Fibonacci ratios we shall use are 0.236, 0.382, 0.500, 0.618, and 0.764. But 0.382, 0.500 and 0.618 — are the most important to watch for, and how we can use them in our day to day trading is explained below.

To set up Fibonacci on the chart we need to find out:
1. Is it uptrend or downtrend?
2. Highest and lowest swings in the chart formation (A, B points) and go with the trend!

In below example I will show you how to calculate Fibonacci Level. Below you can see a chart of the 4H GBP/USD. (I deleted some part of the picture to help you understand the concept). Now determine Point A and Point B.

Point A is 1.9213 and Point B is 1.9827.

Now Calculate difference between Point A and Point B. (i.e. B-A)

1.9827 – 1.9213 = 0.0614

Now Calculate 38.2% of 0.0614

0.0614 * 38.2 / 100 = 0.0234548

(To Calculate 50% or 61.4% just replace 38.2 with 50 or 61.4)

Now minus your answer (0.0234548) from Point B.

1.9827 – 0.0234548 = 1.9592

Here we get 38.2% retracement as 1.9592.

Similarly you can calculate for Downtrend, only difference is instead of subtracting result of 38.2% / 50% / 61.4% form Point B we ADD it to Point B.

How to I Use?

As soon as you can see that there is going to be a retracement, calculate my retracement levels and do the following.

Entry Rule: Enter at the 38.2% retracement level and place Stop Loss behind the 61.8% retracement level.

Exit Rule: Exit at Point B but if Forex market is strong then you can use formula 1:1, it means AB = CD (where D is our target), formula is calculate difference between A and B and add it to the C. For downtrend A-B+C, uptrend B-A+C.

For Stop Loss If the difference between the 38.2% and 61.8% level is too great a risk then drop down a time frame and use the same technique but get a much tighter stop.

Looking at any chart it's obvious that the best entry position would be at the lowest possible swing e.g. at 0.618 retracement level. But Forex Market Price can hit 0.382 and go straight back, sometimes it gets to 0.500,and at times even pierces deep to the 0.618 level. But still, you can determine best entry point by get an indication that the strength and momentum of the market is also in favors with our theory. For this, we could have a slow stochastic oscillator, a MACD and a RSI just as an example to give us an indication of the weight of our reentry into the trade or late entry based on the retracement idea.