Swing Trading For Beginners - 4 Rules for Success

Swing trading for beginners is a great way to make money for novice traders its easy to understand and learn and if you follow the 4 Rules here, you will be well on your way to swing trading success. Swing trading is a method of trading that relies on catching reactions within major trends either up or down and generally a swing trade will last between 2 - 5 days. Some forex traders try and swing trade within daily time frames but this is a recipe for disaster it doesn t work so don t even try it. Here are your 4 rules to follow for success in swing trading Rule 1 Use Support and Resistance When you swing trade in forex you will need to spot areas of support and resistance on the daily forex chart. Ideally ones that have seen prices spike on high volatility are good as these tend not to last so use the Bollinger band as well as trend lines. Generally the more tests of resistance there are the more valid it is so 3 x tests or more and two different time frames is ideal. When swing trading in forex DON T make this common mistake: Many traders simply wait for the price to get close to the level there looking at and simply enter a trading signal and hope the level holds - This will lead to a swift wipe out don t hope or predict your guessing and the markets will not reward you, they will take your equity. You need to get the odds on your side and for this you need to watch price momentum. Rule 2 Watch Momentum For example, when prices approach a level wait for price momentum to turn back as measured by momentum oscillators. If you are swing trading in forex or any other financial instrument this confirms your trading signal. We don t have enough room to cover the individual indicators here but you should start with the stochastic and Relative Strength Index (RSI) and these are covered in our other articles. Now you re in the trade the next rule involves the import but making some profits! Rule 3 Set a Target When you enter a swing trade profits and losses ten to come quickly. The stop is easy to place and obvious - behind the support or resistance you are looking at. If you can use a stop close basis. Set a target just before where you think the price is going to go and take it early. Keep in mind you can hang on but the odds of success will decrease as you get to the target level so better to tuck it in early in case of a reaction. Although some trades will run on the odds will be in your favour more by banking early. So there you have it a simple swing trading system that is ideal for swing trading for beginners and will work for any trader. You may say that s too simple - but the best systems are and it s a fact that simple systems beat complicated ones, as there are less elements to break. Rule 4 Shop Spreads You should only trade volatile, liquid currencies when swing trading. In the majors you should be able to get some tight spreads of just a couple of pips. All brokers are not equal when it comes to spreads, choose wisely, as transaction costs mount up and you need to get the tightest spreads you can. Swing trading for beginners is an ideal form of trading. It s simple to learn and can be a great addition to your forex trading strategy and make solid long term gains if done correctly and help you enjoy currency trading success. NEW! FREE TRADMORE ON SWING TRADING AND FREE TRADER PDF S For free 2 x trading Pdf s and more on swing trading for beginners visit our website at: learncurrencytradingonline.com/index.html

The Rules of Forex Trading Money Management

In the emerging field of financial psychology, study after study has proven that, even with winning odds as high as 60%, only five percent of traders will be in the black by year s end. Despite the 60% winning odds, the losing ninety-five percent have never learned money management, and this isn t just theoretical FOREX speculation. Money management is the most important part of any trading system, and surprisingly, few traders understand how valuable a tool it truly is. Put simply, money management is the money you are going to put on a single trade and, conversely, the amount of risk you are willing to take for this trade. There are lots and lots of money management strategies (likely, as many as there are financial strategists) but they all have one central theme: preventing high risk exposure. The One Percent Risk Rule Much akin to the golden rule of ethics, the one percent rule has saved many a trader quite a bit of coin. Basically, the beauty of the system is in its simplicity; adjust your risk for every trade to roughly 1%. If you ve got the stomach and the confidence in your system, your risk per trade can go as high as 3%, but anymore and you re gambling, not trading. For example: 1% risk of $1,000,000 account is equivalent to= $10,000 Your stop loss should be adjusted so that you never lose more than $10,000 per single trade. Simple, right? Then why don t more people adhere to the One Percent Rule? The fact is, people in the trading business are not looking for steady low-risk growth over the long term. They re results oriented and many feel that if 1% risk creates moderate profits, how much more with 5% or even 10% create? This type of reasoning has lead to much more popular theories. The Martingale Strategy Any gambler can tell you about this strategy. The premise is simple: as you lose more, increase your risk. If you re sitting at the blackjack tables and you bet $50 and lose, bet $100. Lose that, bet $200 etc. The philosophy is that after enough losing hands your chance to win is much larger so you can add more money to recover any losses. But here s the dirty little secret that makes the casinos the millions of dollars a year: your odds are the same no matter what hand you play. Your odds start over on every hand and what you ve done previously or what you ll do in the future makes no difference. Many novice FOREX investors try this strategy in their trading and predictably, lose a lot of money in very short amounts of time. The Opposite of Martingale Another popular strategy is the Opposite or Anti-Martingale Rule. This rule maintains that you increase your risk when winning and decrease your risk when not winning. For example: A trader starts with $1000 and his trade size is $100. After a year, his balance is up to $2000 so his trade size should go up to $200. Not a bad strategy, eh? It s strength lies in its simplicity: the more you win, the more you bet. It s a higher risk strategy for traders looking for a higher return but still wanting to maintain their initial balance. A tried and true method many a trader has used on the road to riches. Kevin Davis has been investing online for 10 years and just recently started looking into expanding his investments into the FOREX market. To learn more about the forex market join Kevin inside the membership site, lots-of-pips.com

The Status Of The China RMB

Issued by the People s Bank of China, the Chinese renminbi is one of the most unique currencies in the world at the moment. This is largely because of the restrictions and history that have characterised it since its introduction in 1948. Its status is certainly interesting because of the fact that it operates in a somewhat unique way and thus its status has always come into question. As a result, it is a currency that is worthy of further investigation in terms of forex information before any investment is made. The China RMB was initially set at unrealistic level when introduced to the foreign currency trading floor. That caused problems domestically and prevented legitimate and legal currency trading in any way, shape or form. However, owing to the growing Chinese economy and tourism industry, it was necessary for an overhaul of the renminbi to take place. There are still problems with the Chinese RMB, which has a knock on effect on fx currency trading. It is not fully convertible as yet and also has to operate within bounds set by the Chinese central government. Thus it may not be compatible for foreign currency trading if an individual trader happens to be a beginner in the field. The China RMB was initially pegged to the US dollar for trading, but this was altered in 2005, when the RMB was also revalued. It was set at 8.11 against the dollar and pegged against several currencies, including the Japanese yen, South Korean won, Australian dollar, Canadian dollar, British pound and Thai baht. It was allowed to float, but again was set in strict boundaries by the Chinese government. However, it was valued at a massive 9.7% up in August 2007, which is its highest rate since the peg was lifted. In terms of fx currency trading, this actually had the potential to reap rewards for those individuals that had invested. Its status at the moment actually owes much to the fact that Chinese trade is doing better than US trade. The Chinese trade surplus stood at 33% in August and actually overtook the US in terms of exports to Europe. However, the inflation rates in China have mirrored those around the world and contributed to the global economy accordingly. It stood at 6.5%, which is by far the highest since the turn of the millennium. This has led to speculation amongst forex information experts that it could float freely in the market as early as 2008. Whether that will actually materialize, only time will tell, but in the meantime, the RMB is certainly making waves in the world of forex. Whilst its status is uncertain, it will continue to do so! A freelance writer who publishes articles which are of interest to readers. For additional information on Forex Trading, please visit lyonsforex.com

Business With Forex

As stated Forex Trading is the exchange of currencies for profit, and it offers unmatched potential for profitable trading in any market condition or stage of the business cycle. Usually, investors are speculating on daily currency fluctuations and this is a constant profit source; this Forex business profit mechanism. Independent Financial Advisers, Successful Forex Traders, Banks Insurance companies, Advertising companies, Organizers of financial seminars, Estate agents, Sales Executives with interested client base. Any business professional with interested clients. How do you know if your contacts are interested in the Forex markets? Or if you don t like to trade; focus on your other business but at the same time wish to profit from the very lucrative exchange market. Since the majority of Forex business is based on credit, the partnership with financial institution is crucial to offers their clients better in an investment. If you look at online Forex trading as a business, you probably can t find another business you can start for less. Getting started as an Introducing Broker. Make sure that the Forex broker you choose to become an Introducing Broker for provides all the assistance you require to grow your new business. Trading is very appealing for interested business people, because you can engage in transactions 24-hours a day from Monday to Friday. Earlier, a minimum transaction size was required to conduct business with the Forex. If you lose money early in your trading career it s extremely hard to gain it back; the ploy is not to go off half-cocked; study the Forex business before you start to trade. So your first step to move into Forex trading, or shares trading and investment or futures and commodities trading is to get the correct training in terms of strategy, and learning to trade professionally as a business. So if you are an internet marketer, and you have a good cash flow from your internet marketing business, it is never too late to start right now to transit and also move into investing in the financial markets such as Forex, stocks and shares or futures and commodities to start creating the assets flow - to own more liquid assets to your name. Soli Katir solikatir.com/Forex-Enterprise.html Learn how to have a legit online business that puts real money into your bank account.

Trading Forex - FED Rate Decision and Forex

For last few years there has been few, if any, surprises, when it came to FED interest decisions. We enjoyed long a steady period of gradual rate increases, followed by a prolonged time span of no action policy. For most part these outcomes have been expected and predicted by market analysts. Times have changed somewhat. Recent activities in stock and, especially, credit markets, created great uncertainty about the direction of interest rates. During their next meeting on September 18th, Federal Reserve policymakers will make a decision that just might prove momentous to all financial markets. Perhaps even for months or years to come. With the much publicized credit crunch causing a good size sell off in stock market, there are plenty of voices calling for a rate cut. Opinions are being raised that only FED decision to lower interest rates will help struggling housing market and stem the tide of foreclosures, bringing some stability to mortgage industry. Of course, these claims are being made by people directly involved in this beleaguered sector, like bankers, mortgage companies directors and Wall Street institutions who underwrote an avalanche of questionable loans and lending practices. As much as it is Federal Reserve role to maintain stable financial environment, they are not in a business of bailing out speculators and companies not adhering to sound investment practices. That much has been made clear by the Fed Chairman, Ben Bernanke. They have to under consideration a sleuth of additional factors, as well as the potential impact of any decision for some time into the future. Not an easy or enviable task. Clearly an argument can be made for each possible outcome, and why FED should cut, leave rates unchanged or even raise them. Each one of these scenarios will have an impact on Forex, more precisely, dollar denominated pairs. Conventional wisdom would make us believe that a rate cut will make USD even more unattractive than it already is. In this case farther slide would inevitable, straight into all time low levels against Euro, for example. And host of other currencies. Let s consider another scenario. FED cuts rates and this moves is followed by other central banks during their next respective meetings. Dollar strengthens and goes an 1-2 years long bull run. This particular outcome is just as plausible as any other. And why not? Long term chart are signaling for a break in current USD bear run. We will not know for a while. Here is when media comes in. After the fact there will be plenty of great explanations of why this or that happened. Should the dollar experience another sell off, we will read that it was caused by rate cut. If there is no reaction of any size, somebody will very handily explain “it was already priced in before decision”. Bottom line is, nobody really knows what the decision will be, and even less how the markets will react. What should one do? Not much. This particular FED announcement is the most anticipated in years. There will be great dose of indecision and, most likely, severely lowered liquidity. Initial reaction can easily be wild swings over 100 pips either way, maybe even both ways. Best thing to do really is to close any short term trades and watch the what happens. There maybe a valuable lesson for the future unfolding on the screens. Mike P. Kulej is a Chief Forex Strategist for Spectrum Forex LLC. He specializes in mechanical trading systems as explained on spectrumforex.com Spectrum Forex LLC offers numerous services to individual traders. With questions and comments e-mail him at kulej@spectrumforex.com

Precautions While Online Money Transfer

Online money transfer is a safe way to transfer money because the money is always tracked with your email id. This ensures that not only the money is collected only by the person for whom it is meant, but also its speedy remittance. The popularity of online money transfer is gaining at a high rate because of the certain advantages it offers, nevertheless, some significant disadvantages do exist (fraud, failure of technology, possible tracking of individuals and loss of human interaction) which only some authentic online money transfer service providers have been able to overcome. Before selecting an online money transfer service, you should check out how authentic the service provider is and how fast your money would be transferred. For example, the focus of digital cash is being able to use it through a wider range of hardware such as secured credit cards, and linked bank accounts. Developments in the area of decentralized money are underway for a more secured money transfer option. Furthering network evolution in terms of security in online money transfer is use of digital currency that allows users to transact without using real cash. Digital currencies are backed by real currency that are stored as collateral and not transferred. Hence, fraudulent activists will not mortgage When they are purchased they come under someone’s own name and are stored on his computer or under his online identity. At all times, e-currency is linked to its inventor company and all transactions go through it, making it a completely fail safe transaction. Myself webmaster of epay.vg dealing in Online Money Transfer , online payment gateway, virtual credit cards, virtual debit cards, international money transfer, money transfer services, email payment, mobile payment and other e-currency transfer services

Optimize Your Forex Trading with the RSI

Among the different indicators in technical analysis, Relative Strength Index (RSI) is the easiest to interpret. Developed by J. Welles Wilder, the world first knew about this powerful analytical tool in 1978 through an article in commodities magazine (now Future Magazine). Then, RSI was introduced in Wilder’s book, New Concepts in Technical Analysis that was published in the same year. RSI is based on the statistical phenomena of “regression to the mean”. The basic application of these phenomena assumes that within a statistical sample, a random variable should have a value closer to its mean value. Applying this to the foreign exchange market will imply that the price of a currency pair shouldn’t rise or fall dramatically over a short period of time; and if this happens, the market is said to be in an overbought or oversold status. Setting the Parameters of the RSI Although traders can customize the input periods of the RSI, 14 is the most frequent one. This is what Wilder has recommended in his book as a default period and this is what the majority of traders are using today. Interpreting the numbers: RSI is based on a scale of 100 points with a reading below 30 indicating an oversold status and a reading above 70 referring to an overbought status. Suggested Strategy: 1) Traders need to identify a range bound market (higher lows and lower highs). 2) When the RSI moves above 70, traders may place a short position after the RSI moves back below 70 or after formation of a bearish candlestick pattern. 3) When the RSI moves below 30, traders may place a long position after the RSI moves back above 30 or after the formation of a bullish candlestick pattern. To learn more please visit a website traderschoicefx.com

Forex Market Timing - Why If You Try and Predict Your Guaranteed To Lose

To trade forex successfully you have to time your trading signal. There are many gurus vendors telling you can predict tops and bottoms in advance but this is the biggest myth of forex trading you cant - you can time your signal differently though and still make a lot of money. If you try and predict market tops and bottoms you are simply hoping or guessing that support and resistance will hold and this will see the demise of your account equity. The reason for this is markets do not move to scientific theory as many people think. This is common sense! If they did we would all know the answer in advance and there would be no market. Markets don t move by Hocus Pocus or a magic formula, it s a bit more complex than that! Humans decide the price of anything and the millions of traders who contribute the market price, are NOT logical and you cannot tell what they will do with any certainty at all. Understand this in regard to forex market timing: Forex trading is a game of odds NOT certainties. If you understand the above, you can still make money - but your not going to predict your market timing, you are going to trade on the reality of price change and trade the truth - i.e the market price as it is. If you want to win at forex trading you need to trade on confirmation. If you don t know anything about using leading indicators or price or momentum oscillators, its time to start making them part of your forex education. For example you see prices dip to support but you don t simply buy - you wait until prices turn away from support - supported by price momentum. Then you execute your trading signal. We don t have time to discuss the individual indicators here, simply see our other articles for a fuller discussion of momentum. Sure you miss the turn but you didn t know the price would turn would until AFTER it did so that s not a problem. Many traders are obsessed with trying to be clever and trying to get in with pinpoint accuracy - but its impossible to do so don t try. Your objective in forex trading is to make money and if you use market timing in line with price momentum, you can do this and trade with the odds for long term currency trading success. If you got just 50% of every major trend you would be very rich. So think about the money you can make rather than feeling smug. Today, advances in science and computer technology are staggering and your personal PC contains more power than the computer Mission Control used for the moon landings and it s tempting to think that computers can predict in currency markets - but they can t. Predicting a chaotic market with accuracy is impossible and anyone who tells you they can is a liar or a fool. Of course, as we have said this doesn t mean you can t make money you can you simply trade price momentum and trade the odds. Understand the above and you are well on your way to currency trading success. NEW! FREE 2 x CRITICAL TRADER PDFS LEARN HOW TO TRADE HUMAN PSYCHOLOGY THE RIGHT WAY Grab your Free critical trader PDFS, and more FREE Forex Education visit our website at: learncurrencytradingonline.com/index.html

Forex Trading Style- 7 Essential Indicators You Need

When developing your own forex trading style, there is a danger in becoming fascinated with indicators. The newer trader experiments with one, finds it doesn t work so well, then switches to another, then another, etc. The list below highlights 7 key indicators that can be woven into your forex trading style. You may not need to go any further than this. Stick with the 7, practice them, get to know them inside out, and get the satisfaction of developing your own successful forex trading style. #1: Candlesticks Watch for a hammer, doji, head and shoulders pattern, 1-2-3 formation, double top or bottom. #2: Trendlines Draw common sense trendlines across the highs in a downtrend or lows in an uptrend. Watch for price to break the trendline and come back and test it. #3: MACD Watch for a difference between the highs and lows of MACD and price. When there is divergence watch closely for a good entry point once price has shifted in the direction of the divergence. #4: 200 EMA This indicator is an all time favorite for traders across the board. On higher time frames (1 hour, 4 hour, daily) take note whether price is above or below the 200 EMA to give you the sense of price direction. #5: Pivot points Take note of previous support and resistance lines as price will come back to retest these levels time and time again. #6: Fibonacci Learn how to use this tool well and take particular note of the 50 and 62 retracement levels, especially when they coincide with trendlines or previous support/resistance. #7 Price Itself Let price prove to you where it wants to go by setting entry orders rather than market orders when entering a trade. By setting an entry order, price has to reach the target you specify before pulling you into the trade. Using Technical Indicators It is important to acknowledge the probability that no indicator on its own is a good enough reason for entering or exiting a trade. Your individual Forex trading style will evolve in time as you become familiar with the key indicators and probably rely heavily on just 2 or 3 out of the 7. However, it is crucial to get a combination factor when considering a trade. Ask questions such as: While one indicator may show a clear signal, how do the other indicators line up? Is that one signal running against the general conclusion drawn from the other indicators? This is where your skill as a trader comes in as you assess the clues the indicators give and make a decision based on your perception and experience in the market. Only time and practice can give you that. Once you are familiar with the top 7 indicators, spend most of your time and energy on developing the emotional and mental disciplines necessary for successful trading. This will eventually make up the most important part of your Forex trading style. Click here to see how indicator #3, MACD, can help you avoid much anxiety: vitalstop.com/Forex/macd.html Click here to learn how to use indicator #4, the 200 EMA, in a simple yet powerful way: vitalstop.com/Forex/Advisor/200EMA-forex-strategy.htm For the best free economic calendars plus a free pivot point calculator and Fibonacci calculator click here: vitalstop.com/Forex/tools.html

My Experiences Trading U.S. Bonds and Interest Rate Commodity Futures Contracts and Options

U.S. Bonds are the king of interest rate futures and a great trading market! Here s some valuable hints and kinks taken from actual trading experiences. When it comes to trading interest rate futures, there s no market like US Bonds! It s the most liquid and has the best price swings of the interest rates group. US Bond futures contracts are also called the long bond or the 30-year bond, James Bond. Trailing behind are the ten year and five year note futures, though these have gained some popularity due to the real estate “bubble.” The full-size US Bonds future contract contains $100,000 of bonds (par value) and is controlled with about $1300 of trading account margin money. Each full point move is equal to $1,000. The mini-contract is one-half the full-size contract and is better suited for the beginning trader. Trading is on the Chicago Board of Trade, a large and reputable commodity exchange. The liquidity is excellent and the volatility makes day trading popular for both advanced and novice traders alike. Because of this deep liquidity, at the market stop loss orders are usually triggered with a very little slippage. A broker friend of mine swears by US Bond option strangle strategies. This is a popular technique selling (writing) both a put and call option outside a price range, looking for them to expire worthless. Option writers look to collect the option premiums from the option buyers. The option writers want the market to stay within a range of prices while the option buyers are speculating on a large move outside this range. A one-day US Bond contract move of three full points is probably the maximum that you will see. ($3,000 move per contract) This is a rare event usually caused by a big surprise from the Fed, the release of a government financial report or an unforeseen event. Since US T-Bond futures become most volatile around scheduled major reports, it s often wise to take your profits beforehand. Many reversals occur around these times. The old trading adage, first way, wrong way means the first price reaction to a report is usually wrong. For example, a long awaited report comes out and the market immediately runs up. A few minutes later the professionals sell heavily into this rally and the market sells off sharply. This spells opportunity for sharp traders and potential losses to others. US Treasury bond futures are presently traded electronically through the CBOT. This means you can get order fills almost instantaneously. The days of the screaming commodity pits may be limited. Fed Fund futures trade the reverse of rates. For example, March Fed Funds futures at 95.00 would equate to traders expecting Fed fund rates to be 5% in March. (100%-95% = 5%) The 30-year bond is one of the best indications of general interest rate direction. The trend of the fed fund rates is also key. Be sure to consider both US Bonds and Fed Funds trends in your general rates forecasts. Treasury bonds tend to make double tops. Sell against double and triple tops when they present themselves. These long term tops don’t happen very often, so keep your eyes open. Triangles are also popular as well as head and shoulders formations. The bond market often trends well for long periods. Major multi-year government policies put these trends in motion. Fortunes can be made by accurately trading the bond market. Here s how I look for opportunities in the U.S. Bond market: First I generate a TimeLine forecast that shows a strong move up or down. The TimeLine is based on time cycles and other preprogrammed patterns. I then determine if the move is expected to be choppy, trending, and for how long. This helps us focus on possible directional futures/option positions or writing options in a range, or even writing options with the trend. Next I use automated option software to search for the best of 1600 strategies based on the expected market move. I compare these option to option combinations against futures to options combinations. At some point I will find a compromise between risk, profit and simplicity in one or two strategies. In hindsight there s always a best strategy we could have used. Keep this is mind when narrowing down the choices. When finished, we want to have one or two potential trades to work with. We call the selected few, high probability, low risk trades. Remember there is more to planning a trade than just coming up with a forecast. The market may move as predicted but we can still lose by choosing the wrong trading vehicles. Pick the right vehicles and strategies that will allow us to stay in the market without excessive fear, but still carrying calculated risk. We NEED to take on calculated risk or the market will not pay us for our services. In addition, the vehicle has to move far enough to make a profit without letting the expense of protection eat us up. Excessive protection (risk avoidance) can come in the form of option premiums, too close-in stop loss orders - and overdone, complex spread strategies. Matching a forecast to a strategy is an important skill to succeed in commodity trading. Good Trading! There is substantial risk of loss trading futures and options and may not be suitable for all types of investors. Only risk capital should be used. Thomas Cathey - 27-year trading veteran heads the managed futures division of Thomas Capital Management, LLC. View his market forecast TimeLine Trading charts and get his complete 44 lesson, Thomas Commodity Trading Course - all free. thomascapitalmanagement.com/commodity/welcome.htm Main site: ThomasCapitalManagement.com