titleThe Real Secret to Day Trading Forex Currency/titlepYou want to know the real secret to day trading forex currency? Well, here it is: emConfidence and understanding of the market/em. There you go. Theres your real holy grail. If you can accomplish these two feats then you can write your own paycheck. Happy? Ok, so you probably need a little more information. Fine. Here it is:/ppustrongConfidence/strong/u! I cannot begin to tell you how many forex traders in the world are having anxiety attacks watching their trades just as I am typing. If you cant handle a trade or trading or in general, then ustrongdont do it/strong/u. Youll never have success day trading forex currency if you are watching every pip move like its life or death. Emotions can destroy a trader. A traders fear can cause him/her to hold a trade even though the obvious trend is going against them. It could also have the adverse effect in which a trader closes a trade WAY too early because hes afraid to hold it, even though all the signs are pointing in the right direction./ppI could give you the greatest trading system in the world, but it wont do you much good if you dont have any confidence in trading it./ppThe ustrongunderstanding of the market/strong/u goes hand in hand with the confidence. When I say emunderstand,/em I mean just that: Understand what you are looking at. Dont be like everybody else who has to use indicators to tell them what the market is doing. Does anybody understand what these indicators even mean? Can you honestly tell me what using an MACD Divergence does? Its colorful and its pretty on a chart, but what does that have to do with the tea in China? Take the time to understand the underlying causes of price and market movement./ppTake off the indicators on your charts and see if you notice some repeated patterns. If you can start to see them then you can be ahead of the other 95% of forex traders who end up losing money on the markets. After all how can you have confidence day trading forex currency if you have no idea what you are looking at./ppJim Buhs has been a successful forex trader after learning how to trade price action. He was able to have a target=_new href=http://www.squidoo.com/forex-successforex trading success/A after he cleaned his charts of indicators, and his profits soared./ppTo check out Jims Highest recommendation go to LearnForexDirectory.com and look at a target=_new href=http://www.learnforexdirectory.com/forex-education/bird-watching-in-lion-country.htmlBird Watching in Lion Country/A./pbrbr

Recession word itself enough to create a panic in the stomach of the whole world. If someone gets up and checks the empirical meaning of recession in the good lexicon, he or she will feel something disgusting about it; fear factor will dance in front of him or her. It looks like coming to hell just after knocking the door of the zenith.

At this juncture world is confronting the same fearful word “Recession” in empirical way. The world had good news that U.S. GDP (Gross Domestic Product) has grown 3.3% annually in second quarter of year 2008 but it was just like an oasis and faded away when US government has given whopping jobless claims 444,000 on last Thursday. Rising inflation, housing slowdown, 16 year low housing prices, diminishing industrial growth, Federal Reserve policy on interest rate all are rubbing salt on the wounds. Now US government is pondering over the Fannie and Freddie financials and set to take over the housing mortgage giants.

It is not only United States of America but whole world starting from African countries to European countries, which covers Asia too. Markets from New Zealand to India suffered a sell-off Friday, September 5, 2008, with as many as five benchmark indices set 52-week lows, as investors dumped stocks on concerns about weakening growth prospects and uncertainty over the global economy.

Socio-political issues has created unusual troubles in South Africa, which is known as the most prosperous country in the African continent and precious metal mining hub across the globe, had reeled on august 6, 2008, when rand has fallen 1.90% against the USD due to trade union nationwide strike to protest against the food and electricity prices. State military of Nigeria said, “Blast was not an accident but deliberate sabotage by a group protesting the alleged nonpayment of fees by the energy company to the local population.” Nigeria social turmoil is on acme and any time untoward happening may occur that can fuel, for the time being subsidized, crude oil prices. Zimbabwe political instability continues to romp over the constructive activities in the region. The inflation in Zimbabwe jumped to over 11,250,000% in June. Rebels in Kenya are also contributing enough in poorly shaped African economic condition.

Now look at Asian economies, first comes China where everyone was thinking that after the Olympics china will resume the economic work on growth agenda and the demand for the commodities like copper, aluminum and steel will rise but it was a distant dream all base metals are setting new lows on commodity exchanges. China also eyeing on currency markets and all set to devalue the Yuan against its rival currencies in order to enhance the export growth which has become less lucrative for the exporters. World Bank has trimmed China’s growth rate to 9.60% from earlier 10.80% for the current fiscal. China needs to generate more than a million jobs every year and it is very difficult without double digit growth rate on the cards.

Japan, The land of rising sun, is also undergoing through tremendous inflationary pressure which was previously known for deflation. Prime Minister Yasuo Fukuda resigned after less than a year in office. His government failed to rein in inflation. The rise in inflation has been a trauma for a country that has spent the last decade grappling with deflation. Core consumer prices were up 2.4% in July 2008 from a year earlier, a panic bounce since 1997, and many Japanese have clamped down on spending. Japanese finance ministry has already given cowardice statement over the current year GDP growth rate. Experts say Japan has already slipped into recession and no one is predicting growth above 1% this year.

HengSeng, the Hong Kong stock index, has broken the 20,000 level. South Korea is under the scan of developed world where nuclear energy matters continues to harass the top officials of the nation. Korean Stock index is also not showing any glimpse of breaking upper records.

India’s economy grew at its lowest rate in the first quarter of financial year 2008-09 since last three years. The Reserve Bank of India is all set to rein into record high inflation by applying tight credit policy which remained above 12% level for the past few weeks. Annual growth slowed to 7.90 % in the first quarter of 2008-09 which ended on June 30, significantly lower than the 8.80 % rate reported for the January – March quarter.

Europe also nowhere different at present whole Europe is combating with rising inflation and fresh downward revisions in the growth rate. European inflation accelerated to the fastest pace in almost 16 years to a record high 4% earlier before arriving at 3.8%. Consumer business confidence index is also recorded significant decline and Economic confidence fell in August to 88.80. Brussels has revised the Euro zone growth rate downwards to1.80% from earlier November estimate 2.20%. Economic experts offering a faded hope and a few of them declared that next revision would be 1.30%.

Now the world is witnessing a global slowdown which can be said recession but optimistic experts say it is temporary and can be worked out with revamped financial policies. But at this juncture when the status quo is not allowing the central banks to act any way, one side inflation is rising which is not encouraging the central banks for rate cut and other side slowing economic growth is not supporting the rate hike. Hence forth in the last week Bank of England and European Central Bank kept their interest rates undisturbed, 5% and 4.25% respectively. United States Federal Reserve also kept its rate unchanged in last meeting.

Then utmost what can happen?

I think US credit market turmoil and high inflation is nowhere supportive in economic way for the world. Russia- Georgia tension, US-Iran-Israel issue and destructive happenings like terrorist attacks, natural calamities and political turmoil all over world is not foreboding good for the world.

The stock markets, commodity markets and financial instruments are heading towards south and not left even an iota of positive happening. Dow Jones, Nasdaq, FTSE, BSE, CAC, KOSPI, HengSeng, Nikkei, Shanghai all these stock exchanges shed their most of last year gains. Simultaneously commodity markets also near to nadir gold, the safe heaven commodity, has fallen more than $200 US after reaching $988US earlier this year. Silver is already near to set a new of the year. Likewise copper, platinum and aluminum are also fallen to lower extreme. Euro, USD, GBP, and Japanese Yen are behaving in the strange way and creating turmoil in the fundamentals of other financial instruments and markets. At present market elements are fighting for the worst rank. If the currency exchange rates changes more than 10% within a week,

The Raison d’être behind whole scenario of financial instability is that, fundamentals have not been respected during last year across the world. Investors have lost confidence over the period of wrong happenings that led to unsystematic investment in the financial markets. As far US, the world largest economy is concern until presidential election (new President) glimpse of hope is far away since it requires a major policy change. If same situation prevails shortly world may face biggest foul turnaround.

The whole world need to get together and must make necessary changes in the economical and political policies in order to overcome from this current imbroglio. The fundamentals of the market i.e. Demand and Supply has to be restored. People must realize the real money. G-7 meeting proposals have to be implemented in order to soothe the boiling intricacy of the world.

What can an investor do?

A good investor must workout different strategy for the investment. Meantime investors can stay away from the paper stocks and they can invest in the real asset value market viz. real estate, and commodities which runs on fundamentals rather than speculations. This is the best time to invest in housing because the prices are at possible lowest end. Markets with real assets value will perform better than paper assets in coming year.

Contact author at http://www.safetradeadvisors.com or safetradeadvisors@gmail.com

Over the next few lines I will tell you a little story about my experience with my automated forex system, and why it is important that you have one if you want to make money consistently within the forex market.

Forex trading can be a highly profitable business, but as everything in life it all comes down to knowing very well what you are doing. So to make a profit within the forex market you must either be already an expert, or you have to try and become one fast, but then again, becoming an expert in anything within a short period of time is virtually impossible and very risky if it is your investment at stake.

Believe me, even if you are an expert you will make mistakes quite often, maybe not because of a lack of knowledge, but because we as humans sometimes let emotions like fear and greed take us over, and this is where a reliable automated forex system comes in.

I have been trading for quite a while, and I started by trying to educate myself as much as I could, so I began my trading operation on my own. I didn’t do that bad, but I was not making the kind of money I was expecting, considering what some friends of mine where cashing in every month.

After a few months I decided that I have had enough, so I confronted one of my friends to try and suck some information out of him; when I finally managed to break him, he agreed to let me in on what he was doing, and here is what I got:

He confessed to me that in addition to some manually placed trades, he was using an automated forex system that had the ability to place and close over 90% winning trades all by itself.

Initially I took that for a joke and kept asking him to come clean with me, but he insisted that that was it, and to dig me out of my skepticism he sat me at his pc and showed me his forex trading chart. After 15 minutes staring at the monitor, I was surprised by the sound of a new trading order being placed without me or my friend touching anything; it was the automated forex system working. My jaw fell to the ground and I almost strangled my friend for not sharing this with me before.

I stayed there for a several hours because I had to see more to actually believe it. Well, after almost 6 hours and an aching back from my friends crappy chair, I witnessed the automated forex system place 3 winning trades for a $600 profit.

As you might guess, I did not wait until the next day and went straight home to download the software, and after three months using it I can only say that not having it is a waste of your money. You read right, a waste of your money, because you will be missing out on profits that you cannot possibly make all by yourself, and here is why:

1) You can be attentive about what is going on in the forex market for only a few hours a day, because we as humans need to eat, sleep and sometimes even work, and every time you are not following the market trends you are potentially missing profitable entry points for a trade. The automated forex system will be on guard 24 hours per day, and it will take advantage of every good opportunity to place a winning trade, which often occurs during the night.

2) We as humans have a tendency to become scared and nervous when we feel we are about to lose money and that often leads us to make bad calls based on emotion rather than calculated analysis. The automated forex system will never be scared or greedy, it will always act based on the market conditions and therefore will have a much higher rate of winning trades.

This does not mean that you cannot trade based on what you know about the forex market, because having an idea of what you are doing will always place you ahead. However, if you team up with an automated forex system you are certain to increase your profits by 100% or more, and if you are new to the forex market, you will start on the right foot making profits from the very beginning with very little risk.

So if you have ever wondered whether you should have an automated forex system by your side or not, the answer is: Definitely. Not having it will cost you a lot of potential profits.

Visit the: http://www.specialonlinebusinessreviewauthority.com, for details about fully tested and reliable automated forex systems (the one I am using is the first in their list).

Also visit my blog at: http://makequickmoney-bigtime.blogspot.com/, as I am always posting comments on new ideas and giving away useful tools and resources.

The recent turmoil in the worlds equities markets has made it harder and harder to successfully make money from trading equity stocks. The after effects of the credit crisis are having a much longer and more sustained affect on global stock markets than first feared.

Why equities are a bad choice

Virtually all listed companies fund their activities through a combination of both equity (issuing shares to investors) and debt. The debt component of a companies funding can be both short term (such as an overdraft facility) or longer term in the form of a term loan or through the issue of bonds.

The recent credit crisis has occurred because banks have become much less willing to lend money to each other and other large corporate for fear that the counter party will have losses related to the housing crisis in the form of mortgage backed securities. In short they are scared and wary of counter parties losing money through sub prime investments and defaulting on their repayments.

The above factor has had the effect of making borrowing more expensive. If companies have to pay more to borrow their profits will be reduced. As a result of this stock markets have been performing badly.

A lot of investors have been moving their money instead into commodity related investments such as oil, gas and energy. This makes sense for a couple of reasons. Firstly such commodities tend to have a scarcity factor. In other words the supply of oil is limited by the amount that there is in the ground.

In addition to limited supply the demand for these commodity products has been increasing dramatically as emerging nations and economies such as India and China grow rapidly and consume them at a much higher rate. The net effect of these factors has been rising commodity prices.

With neither demand looking likely to fall or supply increasing, investing in commodities is looking like a smart bet, especially at a time of such high volatility in the equities markets.

To learn all you need to know about trading commodities or investing in oil please visit one of the links above.

The Internet has brought a lot of changes in the way that we live our lives and our conduct our personal business. We can shop, date, and bank online. You can do just about anything online.

We can even trade stocks, forex, bonds, futures to name a few online. Traders love having the convenience of being able to look at their accounts whenever they see fit, and brokers also like having the choice to take orders over the net as opposed to the phone.

When you are new to investing it is an advantage to have the ability to speak with a broker. You are able to ask questions face to face and have any fears taken care off. Online stock trading can be very risky when you don’t have the correct information. If this is the case, make sure that you learn as much as you can about trading stocks before you start trading online.

Most brokerage houses now offer online trading to their clientele. Because doing business can cut down operating costs a great thing about trading online is that fees and commissions can be much lower. Online trading is great but like anything there are some disadvantages.

When it comes to choosing an online broker or brokerage firm go with years of establishment as well as feedback from other clients. You won’t find one that has been in business online for many years of course because online trading is just in its infancy, but you can find a company that has been in business that long and now offers online trading.

Working on the internet means relying on a machine and like all other machines break downs can happen. In trading if this is at the most inopportune time it could cause losses for you. You won’t always have the ability to get online to make a trade. You need to be sure that you can call and speak with a broker if this is the case using the online broker. This is truth for both advanced traders or beginners.

Online trading is a fantastic opportunity, convenient and can be highly profitable but it isn’t for everyone. Think carefully before you trade online and make sure that you really know what you are doing. Do your research and homework and you will do very well.

For a FREE indeth Forex Trading E-Course visit Learning Forex Traiding Course. This trading course covers the important basics every trader must know before starting to trade, to get it for free Click Here!

Wadzanai Wendy Nenzou is an internet entrepreneur who is interested in the forex market, stockmarket, anything to do with investment. She has a Bachelor of Commerce and a Masters Of Accounting. She enjoys sharing her knowledge with other marketers and people at large. To learn more from her visit learning-forex-traiding.com

The Plain Facts About Stock Trading

Want to hear a scary statistic? Well, here it is – whether you want to hear or not: “At least 70% of traders lose money” in the stock market. This is according to a report from the North American Securities Administrators Association (NASAA). The report goes on to add that “70% of public traders will not only lose, but will almost certainly lose everything they invest.”

Yikes! Everything? How can that be? Especially with all the charting tools, the stock trading simulators, the books, courses, coaching, and seminars from stock-trading gurus that are available today.

One more little statistic from that report: In all, only “11.5% [of traders] might profitably trade” the markets.

And yet you constantly read about people raking in bushels of cash by day trading – most especially penny stocks. It doesn’t seem to add up.

The Difference Between Winners and Losers?

The difference between the 70% of losers and the 11.5% of winners is – what do you think? The best strategies? Guess again. It is, hands down, a good foundational education about trading and about the markets.

Case in point. A number of years ago a man named Ralph Vince (an expert on the mathematics of trading) conducted an experiment. He chose forty highly educated people – all with doctorate degrees — and gave each of them $1,000 in play money. He then invited them to participate in 100 rounds of a computerized stock trading game. They were even supplied with 100 trades that had a 60% winning percentage.

At the end of the experiment only two of these highly educated individuals – armed with winning strategies – made a profit. Thirty-eight failed! Why?

Specifically because winning strategies do not a trader make!

The criteria that will turn you into a successful trader is time, knowledge, experience and proper guidance. In a word, find some good day trading courses and see which one fits your needs.

Two Ways to Learn

As with most any endeavor there are basically two ways to learn. The first is, obviously, through reading and studying (seminars, online courses, books, videos, etc.). We might call this the formal training.

The second is by experience. The hands-on sensation of the actual day-by-day buying and selling which trigger your roller coaster highs and lows of wildly gyrating emotions. Most day-trading courses included both.

The formal training allows you to learn from the mistakes of others. From their teaching you can learn to avoid the worst of the pitfalls involved in day trading.

Hands-on training helps you get the feel of entering and exiting a trade. The feel of watching that chart move once you’ve pulled the trigger on a trade. The act of exiting at just the right moment to make the profit!

Can you imagine learning to drive a car from reading a book? Or learning to swim from reading a book? So much of it has to do with getting the “feel” of what you’re doing. Trading penny stocks is the same way.

Hands-on training will also help you to know yourself. (It is highly recommended that you begin by paper trading or other means of simulated trading.) What are your basic emotions with regard to money? To investing? To winning? To losing? You had better know ahead of time. Believe it or not, your own basic emotions will play a big part in your success or subsequent failure in day trading penny stocks.

Watch Those Emotions!

Fear is that emotional state of anxiety due to a real or an imagined presence of danger. Fear can impair judgment and cause a trader to recoil from making a trading decision, or to delay a trading decision response.

On the other hand, a self confident person, one with a positive attitude, has a more positive expectation. That person is more likely to take action in spite of a sense of fear. Consider this: winners manage their fear; losers are controlled by their fear.

However, even the most fearful person can overcome that fear with the proper education and training. Using day-trading courses can help to develop self discipline. Self discipline will evolve into self confidence. Once you fully believe in your own abilities (to successfully trade and profit from penny stocks), you will be able to assess and accept risk, and then take decisive action.

If the fear seems overpowering, it is vital that that fear be analyzed. Where does it stem from? From childhood? How can it be faced and worked through? The answer most usually comes through more and more education – both formal and hands-on.

Day Trader’s Traits

Successful day traders must think outside the box. They have to think quickly and wisely. When stocks are fluxuating at split second intervals, making a wrong decision, or ignoring a trade could result in the lost of a great deal of money. Does that describe you?

From the outside looking in, it may appear that day trading penny stocks is akin to gambling. And of course, some traders would prove that assumption to be correct. But they are not the ones who are consistently in the profits.

Day Trading as a Business

Rather than gambling, day trading penny stocks should be thought of as a business. You are both the employee and the boss in this business. You will need another employee – your broker. There will be competitors – the other traders out there, and of course the stock market itself. Just as with any business, there is buying and selling going on. The difference with day trading penny stocks is that this business is extremely fast-paced. (Roller coaster, remember?)

Another part of your day-trading training is to take a realistic look at your day trading business and make plans that will carry you through the long haul. What are your goals and aspirations? The first of course is to make money. But, just as important, is to make money consistently. How is that going to happen?

Working Capital

Understand that your working capital is vital for your business’s survival. Capital preservation is more important than capital growth. Reinvesting profits back into your business should be high on your priority list. What percentage of your total portfolio will be given over to penny stock day trading? Part of it? Half of it? All of it? Make that decision before you plunk down your hard-earned cash.

Can YOU Profit With Penny Stocks?

So can you profit with penny stocks? Absolutely, you can. I encourage you to learn all you can about day trading. Look for good day-trading training courses. Day trading penny stocks can be exciting and rewarding. And with regard to those statistics cited in our intro – they’re really not that scary – as long as you are in that 11.5%. And you can be. Keep your feet firmly planted in good basic foundation of education, and don’t allow yourself to be swept along by hype and high-pressure come-on’s.

Do that and you too can enjoy the cash rewards from successfully day trading penny stocks.

Three of the better day-trading training programs out there are outlined here.

http://www.squidoo.com/daytradingcourses

There are plenty of freebies offered to get you started. There are simulators, coaching programs, webinars, mentoring. You name it, it’s included! And you’ll see there is something here that fits your wallet precisely. If you think education is expensive – try ignorance!! http://www.squidoo.com/daytradingcourses

So, while these steps are applicable to online training for foreign currency trading in the forex market in my case, if you think about it while you read this, it could easily be the same principles that you need to apply to become a professional currency trader in the trading futures markets, or trading options market.

Lets not waste time here is step: 1) Start trying to save your money today not tomorrow or next month.

To trade in the big league or you need a bankroll to play with, and one that is capable to withstand the ups and downs that are a natural part in the trading currency markets. For me, I know this is a problem for most people, but you need to just get an organized budget together. Then stick to it, and if you want it bad enough then it will start to add up to where you need to be in the online currency trading.

So you say “How much money will you need?” Unfortunately I can not be the one to answer that because it will depend on the trading strategy that you chose to implicate, and the amount of leverage that you need to plan on trading with in the course of a day. Also the amount of money that you can take out in profits, is just simply what is extra from what you need in the course of day trading. Though you should not count on having a bare minimum for you currency exchange balance, it you leave a little more in each day then you may be able to start to take more risk. And if you understand that risk means that you have a chance to make a lot of more money, then your on the right track. But I can say, that I see plans from $1000 to a years salary.

The Next Step: 2) Get online training for foreign currency trading.

Common sense will tell you that you need to get training in you subject before you go about risking you money. So with that said, there is plenty of free information to get your self started. With the free information you can get yourself familiar with the terms that they use in the currency trading market, with terms like “fx” meaning forex, or “cdf” meaning, channel definition format. If you just learned something with the last sentence then you know what I mean, because this is also free information that you are reading.

But when that is not enough there is many programs out today, mostly when you register for a trading platform then they will provide you with what you need to get informed in you field of currency trading. The part of the education process that I really am talking about here is necessary, and that is coming up with a good trading strategy that you are personally comfortable with currency exchange rates and among other things, as well as being financially sound with the money management strategy to ensure the long-term viability of your trading strategy plan.

Then the next step:

3) Which can also be simultaneously done with the last step. This is to sign up with demo trading account from a larger online trading broker. Then you can start practicing with your new found trading strategy, while not losing all you money to start, because the demo account uses play money and not real money. At your regular job or, if you have some free time and internet access at your work place, then maybe you can start to get a feel for how a normal day is while practicing trading.

So on to step 4: If you are then already making money trading on “paper,” so to say, and are comfortable with your trading strategy plan, then you need to go ahead and get started having fun with fx trading for real only on a part-time basis. Don’t include all apples in one basket just yet. You need to start out slowly and gain a decent comfort level. Then as your confidence builds up and you have learn from a couple mistakes, then you can start to move money from your savings to increase your bankroll.

Lastly step 5: When you can estimate that your average gains/loses from real trading, from following step 4, are at a level where and when you are comfortable, to say if you were to trade full-time using your present bankroll, you would be making enough profits that slightly go over and exceed your current employment salary, then and only then you are ready to quit your job for once and all, and trade full-time.

Remember, you want your currency trading profits to go over and exceed your present job salary. This will give you the opportunity to maintain a decent current financial level. Also at the same time you can then live with minimal stress in you life and continue to increase your trading bankroll, which will enable you to make more money as the size of your available funds grows sizable larger.

Lastly it is important to have patience with yourself and your online training for foreign currency trading, at each of the steps mentioned above. Mostly the seasoned traders will tell you to maintain emotional equanimity and understand that fear and greed are a traders weakness. If you can keep these strong emotions under control and keep you head straight, the discipline in establishing the while following steps, then you can look forward to making it as a everyday professional trader.

If you liked that and you want to get an even better grasp on Forex go to Prolificinfotoday.com and find more useful free currency trading information

So you’re interested in Forex trading but you’re losing money like an addicted gambler? Have no fear, here’s the solution.

Match Your System with The Market

Of course, whatever style or method you choose to trade, it needs to be profitable. Mathematically, this means that at the end of the day (or month, or year), if you clump all the winners and losers, you’ll end up net positive. Statiscally, this is called having an edge, or having a positive edge. You must make sure, through backtesting and managed forward testing, that your system is indeed profitable. You might be asking, “But I can’t seem to follow my trading plan.” We’ll get to that later, but for now, let’s assume that you CAN follow your trading system perfectly.

Matching your system with the market means that the system works for that market at the time. Keep in mind your system might work for the EUR, but maybe not for the CAD. Also keep in mind that the system might have worked for the previous 6 months, but something happened to the market that the participants are acting differently now; this would mean that your system was profitable for the past 6 months but the market change has nullified your system’s edge.

Let’s assume that your system is somewhat profitable if you could follow it perfectly. So what’s next?

Match The System With Yourself

At this point, you might be thinking, “Hey, I was looking for a How to trade forex article, not some self-help psychoanalysis article.” Do yourself a favor, and read through the entire article, because this might be the key ingredient your trading has been missing.

This is the part where 99% of the traders don’t seem to understand. If you happen to talk with other traders, please feel free to point this section of the article out; it might be the missing key ingredient in your entire system.

It’s pretty obvious that if you have a profitable trading system written down in your trading plan, but you can’t seem to follow the rules, that trading plan is as good as useless. So why do you deviate from you trading plan that you’ve researched so hard for? There are two primary reasons: 1) Your expectations as an analyst versus your expectations as a trader. And 2) Your trading system doesn’t match your personality. I could write an entire book on the first issue, but we’ll focus on the second issue in this article.

To trade with consistency, you need to understand how your subconscious mind works. If your trading system contradicts who YOU are as a person, your mind will NATURALLY pull you away from that trading style, and SUBCONSCIOUSLY gravitate you to a particularly different trading style. A lot of people get confused here, and this is one tough concept, (and really, not too many people want to learn about it) so don’t worry if you’re confused. Let me give you a few examples, the first ones illustrating basic principles, then drilling down to more subtle points:

First example is John. John likes playing video games. He loves playing 5 handed table Texas Hold’em (poker) with his friends. He likes playing hardcore sports. He is a risk-seeker. His natural trading style is day trading and/or fast swing trading. He cannot naturally trade longer time frames because that’s not who John is, and John is a fast-paced guy. So no matter trading system he’s researched, backtested, and written, he won’t be able to trade it unless it fits his naturally fast-paced personality. Also note that his personality has gravitated John towards all these other fast-paced activities like video games and poker.

Let me give you a more subtle example: Susan was an underdog all her life. So she pictures herself as David who fights against all the Goliaths of life. Whenever there’s a competition, election, or basketball game, she always roots for the underdog because subconsciously she relates more with the underdog.
How does this affect her trading? She’s naturally a fader. Fading the market means going the opposite of the major trend. So while trend followers go with the majority of the market participants’ decisions, Susan is the opposite; she naturally likes to bottom/top pick and go against the trend. This means that she has to either 1) change herself to match the trend following system (which is hard), or 2) find and develop a profitable fading trading system (which is easier). Mostly likely, she’ll have a better time trading sideways markets, fading at the edges of the channel. Of course, how she decides to trail also depends on her self-image.

At this point, you might be thinking, “Ok, this is starting to make a little more sense now. But I don’t really know how to do all this stuff.” Let’s move on to the final point.

Know Yourself

Schedule a 1~2 hour block of free time and go through this this action plan:

• 1. Make a list of all the activities you enjoy doing.
• 2. Make a list of all the people you naturally enjoy hanging out with.
• 3. Make a list of all the movies, TV shows, sports, etc. you naturally find pleasure in.
• 4. (Insert more questions you can make up)

Take a close look at all those items, and focus on analyzing what kind of item it is. For each item determine:

• 1. Is this fast-paced, medium-paced, or laid back? Are you a New York City person or a Southern California person?
• 2. Is this more number smart or people smart? Are you naturally good with numbers or with peoples’ feelings?
• 3. Is this more of an underdog or topdog activity? When you watch a tennis match, do you root for the topdog or the underdog?

All these things reflect who you are at the time. The more laid back you are, the larger the timeframe you need to trade (because you would trade less frequently and the trades would take a longer time). The more fast-paced you are, the more you should swing trade or even day trade. The more number smart you are, the more systematic, quantitative, and progamming-oriented you are with your backtesting and trading. The opposite would be much more of a discretionary trader. The more topdog-inclined you are, the more of a trend-following system you need to trade. The opposite would be fading at the edges of a sideways channel.

But keep in mind that most people are a combination of the two. Explore yourself. Take some time for self reflection. Here’re more questions for you to really think about:

• 1. What does this list say about how I should trail my trades?
• 2. How should I enter and exit? Partial profits or not?
• 3. Which markets should I trade? Which session should I trade?
• 4. Should I consider trading stocks, options, or futures instead?
• 5. Should I use technical analysis, fundamental analysis, or both?
• 6. Am I even right for trading?

Let’s look at one last example:

Mathematically, if you don’t take partial profits – that is, you enter and exit only once, and not exit multiple positions – you would make approximately 3~4 times more profit than traders that do take partial profits. To clarify, let’s say you’re long 3 contracts, and you unload 1 lot at +25 pips, the second at +45, and the last at +60: this is what I mean by taking partial profits. But let’s say you’re short 3 lots, and you decide to exit all 3 lots at +47 pips. That would be the opposite of taking partial profits.

But again, let’s take a closer look at what I talked about in this article and relate it to this point: Sure, on paper you’d be more profitable, but then again, all trading plans are profitable. It’s just that you couldn’t follow that plan in the first place. Just as likely, not taking partial profits is more profitable, but it’s the same principle – it’s easier on your mind to take partial profits. It’s a trade off between psychological ease and economical gain.

There is a deep underlying reason why every trader naturally wants to take partial profits, and I could write a separate article on it, but suffice it to say that everyone initially is naturally inclined to cut profits short and let losses run. (As a teaser, it’s about how we grew up in society/school/parents that has instilled beliefs that are beneficial to us in society but detrimental in the markets.) The more question is can you trade this way? Should you trade this way? Forget about what’s more profitable on paper. Focus on being able to trade with consistency by trading according to your natural self.

Well I hope this article has shed some interesting insights with your trading. Perhaps you’re ecstatic at this new finding, perhaps you thought this was a waste of time, or perhaps you don’t even have a trading system yet. Don’t worry, take your time.

So what now?

So now you’ve done your due diligence and now you know what your ideal trading system is. Well, good news! We’ve done most of the research for you. My website has compiled most of today’s forex trading system. If you’re somewhat of a discretionary swing trader, I highly suggest this Forex trading system. Feel free to browse for the right system for you. Feel free to even browse for more Forex education.

Now, before I finish, I’d like to leave you with this: Risk is not a function of the market, but a function of the investor. The greatest thing you can invest in is not in a specific instrument or market. The greatest thing you can invest in is yourself. Never stop reading, never stop learning.

Well, the odds certainly with you. The fact 95% of forex traders fail to make any money. But if you think outside the box a little bit you can certainly be successful trading forex. The key is not to make the same mistakes that are so common with forex traders.

For starters, don’t over leverage your account. I’d recommend not using a margin that is higher than 200:1. Try to keep your usable margin above 95%. So many losses are cause by simply not taking into account the money management aspect of trading. Either they overleverage their accounts so badly that they get margin calls or they just get so nervous and anxious that they cut their trades for major losses just do to fear.

Pick a forex broker with a good history. It’s tough finding one that has 100% positive feedback when doing your research online, so just pick the best out of the bunch. The worst brokers are the ones that chase down your stop losses. You can never account how many losses are taken because the broker pushes the price of the currency to your stop loss, only to revert back to the opposite direction.

But the biggest tip I can give you is get rid of all of your indicators. Think about this statistic again: 95% of forex traders fail to make money. The moment most traders start trading, they instantly find some kind of system that relies on lagging indicators. Lagging indicators: They lag. Even though most people know this, they flood their charts with these indicators, instead of trying to understand the power of price action. Price action is the oldest form of technical analysis. It will never go out of style. It’s just a shame that most traders don’t start of trading this way.

Trading price action is much easier than many people think. Once you understand it you’ll never go back to using indicators.

Check out LearnForexDirectory to see more forex reviews

Wall Street suffered yet another big drop last week, with investors worried about the spreading fallout from the credit crisis at banks, and about a dollar that just keeps getting weaker. The Dow Jones industrial average fell more than 360 points on Wednesday, coincidently just about matching its post FOMC drop.

A lot of familiar worries tormented investors, including comments by New York Attorney General Andrew Cuomo, about conflicts of interest within the mortgage industry, that have increased the declines among bank stocks.

Meanwhile, the dollar swooned amid speculation that China will seek to diversify some of its foreign currency stockpiles beyond the greenback. General Motors Corp further dampened sentiment by posting a record loss tied to an accounting adjustment. The fear with a huge drop like last weeks 2% pull-back is whether it is part of a “correction”, which is a 10% pullback in stock prices, or that it could be the beginning of a bear market. With the huge volatility that has swept Wall Street since the summer, and triple-digit moves in the Dow becoming commonplace, no one can be sure.

Still, the concern on the Street is that the extent of the fallout from the credit market crisis, which has led to billions of dollars in losses for major banks and investment firms, is still not yet known. With Citigroup Inc. announcing it needed to take an additional $8 billion to $11 billion in write downs, investors are becoming increasingly uneasy about stocks, and the economy as a whole.

The economy question can be potentially answered as soon as the retailers start releasing their holiday sales. These figures will show how the consumer has adjusted to the tighter credits, and much lower house values. If the consumer spent like nothing happened, then the economy is just fine. However it’s the other scenario in which the consumers spend more conservatively, and a lot more discounts are needed to attract them to part with their already stretched dollar, which scares the traders the most.

With the above situation, the long-term direction of the SP500 is a murky one, with each side being able to provide both technical and fundamental support for why they are right. You can avoid having to guess which side is right. The company provides an “up or down” bet, which allows a trader to be covered on both sides of the market, as long as the market touches either trigger within the predetermined time.

A 20-day up or down bet on the SP500, with 50 pts each way from the spot trigger, could potentially return 13%. This means you expect the S&P 500 to move 50 points in either direction over the next 20 days.

Name: Mike Wright

Address:
Regent Markets (IOM) Limited
3rd Floor, 1-5 Church Street,
Douglas, Isle of Man IM1 2AG,
British Isles.

Phone: 448003762737

Email: editor@my.regentmarkets.com

URL: http://Betonmarkets.com & http://Betonmarkets.co.uk