Category Archives: Forex

5 Best Forex Trading Platforms Online Today

People often talk about the comfort and usefulness of various Forex trading platforms. Some programs are pretty popular while others are not. The team of JustForex  kindly provided this article about the criteria to know while choosing among the best Forex trading platforms.

How Should Best Forex Trading Platforms Look Like

  • Quick and efficient – Every second is important for scalpers and day traders.
  • Functional – Look at indicators, charts, timeframes, and other instruments. They are also important for short-term, long-term, and swing traders (mid-term).
  • Intuitively easy – A user-friendly interface also can influence your work. You should have a direct access to each feature.
  • Secure – Your data should be highly protected as well as your trading funds. Keep in mind that security depends on both trading platform and broker.
  • Mobile – A Forex platform should work with different systems and devices.

We have collected the best Forex trading platforms that are popular among pro traders. They fit all the points noted above and would be the best 5 choices for Forex trading.

5. Mirror Trader

Mirror Trader by Tradency works like a platform of social trading, as its name suggests. This platform works similarly to the next one and can compares to PAMM account. People can trade fully automatically, semi-automatically and manually here.

4. Zulu Trade

Zulu Trade has been developed by the Zulutrade company. People call this system a provider of free signals around the world. Its community consists of nearly 1200 traders who share their signals. But their effectiveness is different. That’s why the Zulutrade Alchemy service offers new subscribers all-inclusive analysis to make their choice more easy and correct.

3. Ninja Trader

Ninja Trader is a platform developed by the self-titled company. It has full functionality and allows trading of currencies, forwards, futures, options, and even stocks. It has a set of means for market analytics, different features for manual and automated trading, and many other pleasant benefits. Its main advantages are strong security and high efficiency. There are also two versions of NT, Lite (free) and Pro (paid).

2. MetaTrader 5

MetaTrader 5 or MT5 is an improved version of the 4-th one. MetaQuotes aimed for creating a full platform with the complete set of trading opportunities. It allows trading futures, CFDs, options in just one account. As for analytical instruments, it has 79 features for performing the technical and fundamental analysis. There is a chance to work with 21 timeframes, level II, alert system, etc. Moreover, MT5 is even quicker than its “older brother” MT4.

1. MetaTrader 4

MetaTrader 4 or MT4 takes the 1st place as the best Forex trading platform for retail trading. The majority of traders use it for their everyday work. It is software developed and released by MetaQuotes Software Corp. This program allows both manual and automated trading. It is widely used since its release in 2005 thanks to its productivity. MT4 offers a perfect security, many analytical opportunities and automated trading (plus programming).

So, these were the most popular and effective Forex platforms for traders. But you are free to decide which software suits you the most. We advise you to test different platforms before making a final choice. Choose the one and earn money with comfort.

We wish you success and high profits!

What is Forex Swing Trading & How to Find Good Setups

Swing trading is perhaps the trading style that is most relevant to beginning Forex traders. At the same time it is also being widely used by big professional traders. Many swing traders use this approach in combination with day trading or other Forex strategies, in order to have different trading styles for different timeframes.

A swing trader attempts to predict the typical “wave moves” you can see in stocks, indices, commodities or Forex pairs. Investopedia defines swing trading with a holding period of 1 to 4 days. In the Forex market, a typical swing trade happens within the trading week between Monday morning and Friday night. The reason is that many traders prefer to hedge the risk of having open positions during closed market in weekends.

What is a Swing in Forex

The market price of a currency is always the equilibrium between supply and demand. This means that buyers and sellers have agreed on the price and conducted a trade.

Forex Market Equilibrium

Prices can over time move in uptrends and downtrend, or move sideways within a trading range. Markets usually move in a pattern of “range contraction” or consolidation. This is followed by “range expansion,” where price breaks out from the trading range and moves to a new level on the chart.

Compare range contraction to a compressed spring. The expansion happens through a motion up or down in the time of the energy released from the spring. This is the movement in price that we often refer to as a swing, and it can often happen very quickly. If the move follows a pattern with higher highs and higher lows, this is an uptrend. The downtrend has the opposite pattern.

Swing traders look to catch the fastest part of this movement. Some choose to hold positions through several swings, as long as the underlying trend is not broken. Others prefer a shorter timeframe. Compared with other Forex trading styles, swing trading is neither considered a long-term style nor a short-term style. It is simply trading on the medium term timeframe. It is ideal for beginners who want to experience the thrill of the markets without the mental stress of day trading. However, many traders still choose to combine these trading styles with each other.

How Can You Find Good Price Swings?

Most of the time, prices in the Forex market moves within some sort of a trading range, perhaps as much as 70-80% of trading days.

Forex Market Range

You can use a daily chart to quickly browse through different Forex pairs in order to find situations that look promising. Once you have narrowed down your list, you can use a lower timeframe. For example the 1-hour chart could be used to look for your specific entries.

In general, there are three important factors to consider when taking a position in the market as a swing trader.

  • Swings often happen in the same direction as the general direction of the market.
  • Look for momentum in other currencies that share similar characteristics as the one you are approaching. For example, if you want to trade the Australian Dollar you should also check the Canadian Dollar. The reason is that both currencies depend on commodities and energy prices.
  • Evaluate the trend. Is the current trend strengthening or weakening? Weakening trends indicate that a change in the direction is about to occur. At the same time, strengthening trend may still be in its early stage.

Swing Trading Timing and Success Rate

An ideal situation may be to find for example the strongest among “commodity-related” currencies. Then, you can place your trade on that currency. If you know that the oil price rises, you may want to compare the performance of the Norwegian Krone, the Canadian Dollar, and the Brazilian Real. These three currencies are all heavily dependent on oil prices. Place your trade on the one that shows the strongest performance.

As a swing trader, it is important to be aggressive when you spot opportunities like this. Make sure you earn enough money on the easy trades to make up for your inevitable losses when times get tough. Also, it is important to adjust your trading strategies to the market conditions. A bullish swing trading strategy with 80% success rate and 5% average move in the price of the asset under good market conditions may have a 30% success rate and 2% average movement under bad conditions. Then you will lose money.

Just as it is important for a trader to be aggressive in the good times to make the most of them, it is equally important to reduce exposure or even refrain from trading in the bad times.

The famous American stock trader Jesse Livermore once said: “There is a time to go long, a time to go short, and a time to go fishing”. There is a lot of truth to this.

Forex Money Management System: Choosing the Right One

In this article, we would like to share some steps, developed during the years, for choosing the right Forex Money Management (MM) as part of your trading plan. There is no universal Money Management formula which will fit all types of trading strategies. So, we need a way to adapt to every type of automated trading system.

There are 4 core steps,  to go through every time, as follows:

Long-Term Backtest

Long Term Back Testing

The first step is to make a long-term backtest of newly created strategy.  The longer the time span, the better and the more valid the produced results are. One of the ways is to test your systems for more than 10 years time span. If it is long-term based on daily or weekly bars, then it might be better to use 20-30 years of data to produce a significant amount of trades. When you have such a long-term prospective you could rely more (not 100%), that in the future you won’t experience a big surprise, because of a unique market behavior.  It doesn’t matter which trading platform one uses at this step. All of them will produce the data you need for the second step.

R-Multiple Conversion

A way to generate a detailed statement from your trading platform is via excel by converting every trade into R-multiple. You can divide the trade`s gain by the amount of its initial Stop Loss. So if a particular trade has gained 150 pips and its SL is 120 pips, then it is 150/120 = 1.25 R.

The conversion is done for the equalization every market. Every trade has equal weight and across to different market cycles with changing volatility to treat trades equally. So, with this ratio you could compare 10 points gain in Gold with 120 pips on the EUR/USD and 50 pips during quiet market to 200 pips gain during wild juncture.

Equity Curve in R and MaxDD

The next step is to make an accumulated chart using R-multiple ratios. It will look like this:

Equity Curve in Forex Money Management

There isn`t any special calculation at this stage, just simple accumulative math formula.

Based on the chart above, you calculate the MaxDD, which is measured from peak-to through. MaxDD is the biggest equity drop for the entire period of backtesting. So you have to prepare yourself emotionally to face at least as big as MaxDD account decline during the real time trading. So, in terms of Forex Money Management it is the most important information a trader could extract from the past performance.

Choosing Your Forex Money Management System

Choosing Your Money Management System in Forex

Once we have all information we need, it is time to ask ourselves few questions:

  1. How much risk we are willing to put on this particular trading system?
  2. How much equity drop we could tolerate without being burned out emotionally?

Of course, the answers to these question depend on the trader`s capital, personality, and objectives.

For example, if you have a system with MaxDD of 40 R and you plan to be very conservative because, you will trade for your retirement, and you intend to put big money into it, then you could set my max. risk at 10%. So, you should limit your risk per trade to 0.25%. By doing so, you know that your MaxDD will be around 10%. The calculation is done as follows – take your desired risk and then divide it to MaxDD taken from the backtest in R and you will get the risk you have to put per trade. In the occasion it is 10/40=0.25%

On the other hand, if you are willing to be aggressive with the same strategy, by showing willingness to risk as much as 40% of your capital, then putting 1% on every single trade would make sense for your objective.  The calculation here is 40/40=1%.

Summary

We have presented to you a way to determine your Forex Money Management as part of a trading plan. If you prepare enough with your risk per trade, it is most likely to avoid any big surprises, which could potentially lead to trading mistakes and losing money in the future. Of course, we have to reiterate that past performance isn’t an absolute indicator for the future and it is likely the MaxDD to be greater during real trading.

We hope that we have contributed to your knowledge regarding the matter. We wish you a profitable trading.

Best Forex Trading Accounts: Which One is Better

Newbies often wonder what is the difference between the most popular Forex trading accounts and which of them is better to start with. The team on JustForex decided to spread the word about all common accounts as a reason of it. Now make yourself comfortable and let’s take a small Forex journey.

Demo Forex Trading Accounts

This one will definitely suit to newcomers. You won’t trade with real money, but only with virtual funds using this account type. Nevertheless, you can open demo account with trading conditions which are equal to the live ones (Classic, ECN, etc).

Classic Forex Account

Classic is the most common type of standard accounts. These accounts have floating spreads from 1 pip and the maximum leverage of 1:2000. You can trade up to 28 currency pairs and 2 metals on them. There are no commissions on Classic accounts at JustForex. Such accounts are advisable for intraday trading or using EAs.

Cent Forex Trading Accounts

Cent accounts are a great choice for both beginners and experienced traders. They are similar to Classic accounts, but cent lot is 100 times lower than a standard one! This means that you can use smaller sums of money for trading on these accounts. Professional traders can also benefit from these accounts while testing new strategies or automated trading systems.

ECN Accounts

ECN are perfect for scalpers (both real people and EAs) and intraday traders. The spreads float here and start from 0 pips, leverage can be up to 1:500. Choice of financial instruments is quite large too: you can work with any of 88 currency pairs and 3 metals. All transactions opened on ECN accounts are transferred to the interbank. Note that the commission on these accounts is 5 units of the base currency/lot per round.

Islamic Forex Trading Accounts

Swap-free Islamic accounts exist specially for Muslims. If you profess Islam, trading on all your live accounts will go without swaps. Any type of account can become a swap-free one (Classic, ECN, etc.)

No Dealing Desk Accounts

No Dealing Desk accounts are like intermediaries between Classic and ECN. You can trade 88 currency pairs and 3 metals without commissions. The spreads float from 0.8 pips and the maximum leverage is 1:500.

That’s all! We hope that this article was helpful to you. So, choose an account you need and start trading!

Article provided by JustForex

What is Forex: Beginners Guide To Forex Trading

Hey, what is Forex? You sure have heard the term Forex trading a lot recently. This probably has woken up some questions in your mind. This is why we have created this beginners guide to Forex trading in order to build your first impression about the currency market.

Content of Our Beginners Guide To Forex Trading

These are the topics that we will concern in our Forex trading beginners guide:

  1. What is Forex Trading
  2. How Does Forex Trading Work
  3. How to Start with Forex Trading

What is Forex Trading

Foreign Exchange market a.k.a. Forex is the place where trading goes off of the difference between various currencies. The Forex market is the largest, most liquid financial market in the world. It even dwarfs Stock market in size. The currency market has an average trading value of approximately $2,000 billion a day. Currency exchange generates foreign trade and business. Forex market takes advantage of the rise and fall of currency values based on global business dynamics among other factors.

How Does Forex Trading Work

Forex trading market is for currency exchange. But actually it has no central marketplace to work with. The whole Forex trading process runs electronically over-the-counter(OTC). This means that all the Forex trading transactions go electronically between traders over the network.

Forex Trading

In Forex trading, the user usually chooses a currency pair and has to bid based on the rises and the falls of its value. If the bidding is right the user gets his part of the profit. If the guess is wrong, the user loses. There are a lot of strategies and calculated studies in relation when investing in currency.

How to Start with Forex Trading Now

Even after reading this, perhaps you might have certain doubts and inhibitions about delving into the world of Forex trading. One of the websites that could give you more details is Aristrex.

Contrarian Trading Strategies in the Forex Market

When we look at some of the most popular sayings in the financial markets, one is the suggestion that it is generally wise to buy low, and sell high.  In many contexts, this can be quite difficult because the saying assumes that traders will be able to identify exact turning points in major trends in order to spot maximum value.  In some cases, this might be true. But it is always a good idea to understand the idea of contrarian trading strategies and ride the trade to profit.

Harmonic Forex Trading

Harmonic Contrary Trading Strategies

One of the most advanced techniques for those looking to implement contrarian trading strategies is the harmonic pattern trading. This approach is able to pinpoint strong price reversals in very small trading zones.  These patterns unfold in M-shapes in bullish scenarios and as W-shapes in bearish scenarios.  The main characteristic of these shapes is the fact that they come in at the end of extreme price moves. This creates incredible opportunities for traders that look to buy low and sell high.

Additionally, harmonic patterns allow for extremely small reversal areas a.k.a Potential Reversal Zones (or PRZs).  This gives traders the ability to limit risk substantially by placing stop losses just outside the small reversal zones.  Harmonic positions require an online trading account from a broker that offers advanced charting platforms.

Fibonacci Retracement

Fibonacci Contrarian Trading

A more commonly used technique if the Fibonacci Retracement. It is excellent for identifying smaller reversal points within a larger trend framework.  These types of trades need more active management and supervision. However, given the fact that the broader trend is still operating in the opposite direction.

Common retracement levels are the 38.2%, the 50%, the 61.8%, and the 78.6% Fibonacci levels.  This is a relatively basic approach that is well-suited for Forex newbies who use contrarian trading strategies. Also, it needs clear levels of reversal in order to place shorter term Forex positioning stances.

Elliott Wave Analysis

Elliott Waves Forex Trading

Elliott Wave analysis is another commonly heard but less commonly used technique for identifying trend exhaustion points.  This technique views trends in terms of 5/3 wave structures. 5 waves mark the dominant trend and 3 waves mark the corrective trend.  When using EW analysis to place active Forex trades, investors will generally look for situations where an entire trend has run its course. You can open trades in the opposite direction in this case.

Why Contrarian Trading Strategies?

In all, Forex traders can use these techniques to find value in extended markets.  This is one of the best ways of maximizing profits and reducing losses. Each of these techniques should be considered using a Forex demo account so that you can master the approach before any real money is on the line.

Why to Consider Automatic Trading Strategy Generation

The use of automatic trading strategy is a “big business” not only for the retail traders but also for financial institutions Due to increasing processing power, fast network connection speeds and new upcoming technologies like ‘machine learning’, automatic trading becomes more and more lucrative. But what does it mean for a retail trader?

Could an Automatic Trading Strategy be Profitable

You probably already have heard about EA’s or so called Forex robots. Those are automated strategies that are coded by a programmer and run automatically on a Forex trading platform. However the sad truth is that only 1% of all Forex robots are actually making money. This is because most automatic trading strategies are designed and optimized only for a specified time period. You buy a robot today and it stops working within two months. Then, a new set of strategy rules or re-optimization is needed to make the system profitable again. This takes time, efforts, and is very costly. Most of retail traders will just buy a robot, discover that it doesn’t work and go and look for another shiny piece of software. After few tries they will probably say: automatic trading does not work and it’s one big lie. But is it?

What is the Next Big Thing in Automated Trading?

The new upcoming technology is the automatic trading strategy generation. Automatic strategy generation technique makes possible to design, test, and optimize thousands of different strategies in a “split” of a second. (Actually it will take some time but it is 10000 times faster then manual programming and testing). Using special tools designed for automatic trading strategy generation anyone without any programming knowledge can produce and test thousands of original trading strategies in a day. It is possible to test, optimize and select only the strategies that are making profit in current market conditions. This would never be possible with manual EA programming and testing.

What Are the Advantages of Auto-Trading

The biggest advantage is time-saving. The new strategies can be automatically generated and tested 24/7. In few days you can test millions of strategies and select only the best ones. The second advantage of automatic strategy generation is the fact that it really works. There are many examples of profitable strategies that are designed and generated not by humans but by computers. The last big advantage is that this is very new technology and there are many new things to discover. The era of automatically generated trading strategies has just begun.

If you want to learn more about auto-trading and auto strategy generation read here about it: Auto-trading blog

Written by: coensio.com

Forex Trading Journal and the Path to Profit

Ever feel like you’re not improving as a trader? Perhaps you need to take a step back and take a critical look at your trade process. Whether you’re a systematic or discretionary forex trader, the importance of maintaining a thorough Forex trading journal cannot be overstated. In this article we will take a look at what goes into a trading journal and why maintaining one is so important.

Why Are You Entering a Trade?

If you are a discretionary trader, this aspect of your Forex trading journal is incredibly important. Even as a systematic trader, recording each and every entry will allow you to gauge how strictly you are adhering to your system. For each and every trade you should record whether you took the trade based on fundamentals, technicals or a combination of the two and detail the exact circumstances that led you to take the trade. You should also include where you have placed your stop and take profit levels at this stage, your reason for doing so and how much you are risking on the trade.

Example:

Entry – Fundamental / Technical: Looking to buy USDCAD due to FED / BOC rate path divergence. Bought USDCAD. Went long when 20SMA crossed above 100SMA.

40 pip stop loss below the recent swing low, 2R target below last week’s high. Risk = 5%.

Recording the reasoning behind trade entries in this manner will allow you to look back over your trades and analyze which entry methodologies are working for you and which aren’t. Recording your stop loss and take profit decisions will grant you invaluable insight into effective stop and take profit placement.

In Trade Notes

Once you have taken a trade and detailed your reason for entry and SL / TP placement, you should then leave observatory notes as to what happens during the trade. Does the market move immediately in your favor? Or does the market move against you first? Perhaps your trade never enters profit, and you are almost instantaneously stopped out. How do you feel about the trade? Are you confident or anxious? Are you going to trail your stop loss?

Example:

In trade: Pair pulled back 10 pips following entry. A little anxious.

The pair continues to pull back and is starting to look bearish. Stop loss likely to be triggered. Quite anxious, considering cutting Forex loss.

Pair surged higher on US durable goods data, within striking distance of take profit level.

Trailing stop to breakeven.

Recording market behavior following your entry will allow you to fine tune your entry, stop loss and take profit levels. Recording how you feel will teach you to either ignore or listen to your gut (this will vary from trader to trader). If you are always feeling anxious during a trade, chances are you are risking too much.

Result & 20/20 Hindsight

Finally, you will record the result of your trade and with the benefit of 20/20 hindsight, record what you did well and where you could have improved. This is extremely important – especially with a profitable trade! Though you will fill the 20/20 section out once your trade is complete, you may want to come back later and add more incertain situations.

Example:

20/20: Take profit hit +10%.

Entry could have been a lot better – if waited for pull back following MA signal, could have bought 30 pips lower with tighter stop, same target.

Ignoring anxiety paid off – acting on would have led to a loss. Perhaps I’m risking too much per trade?

Locking in breakeven was a good idea – allowed me to relax and let trade play out.

All in all, a good trade, though room for improvement.

Market has since continued to rally – could have taken an extra 80 pips / 2R

This section is truly invaluable. Critiquing your trades in this manner will provide you with priceless insights regarding your trade process and psychology.

Rinse, Repeat and Analyse

On to the next trade. It is impossible to draw reliable conclusions from a single trade. Repeat the above process for your next 20 trades and then analyze your results. Once you have done this, you can start to draw reliable conclusions and begin to adapt your trade process appropriately. Do you need to work on your entries? Should you ignore your gut or listen to it? Are you risking too much? Are break even stops paying off, or are you getting needlessly stopped out of winning trades? Are you taking profits too early and strangling your performance? You may find you are constantly getting stopped out by fractions of a pip and need to move to a low spread account.

Once you have a solid sample base of 100 trades or so, you can start categorizing your trades and see what works and what doesn’t. For example, you can look at all your fundamental or technical trades in isolation, or delve deeper and break them down into news trades or trades based on one particular signal or another. You could even look at stop loss distances: perhaps you have a 75% win rate on trades with stops greater than 30 pips, but only 40% when trading with tighter stops. The possibilities on this front are literally endless, as are the opportunities for improvement.

When we talk to clients, there is a common theme: the vast majority of profitable traders maintain Forex trading journals and critically analyze their performance. Conversely, the vast majority of unprofitable traders don’t bother and end up giving up. It’s up to you: which sort of trader do you want to be? Maintaining a Forex journal and critically analyzing your performance is incredibly simple and leads to some, quite frankly, outstanding results.

Article provided by Vantage FX, Australian Forex Broker.

 

Channel Chart Pattern in Forex Trading

Chart patterns are one of the bases of technical analysis in Forex trading. Today we will discuss one of the first patterns that you need to learn before proceeding with your career in currency exchange – the Channel chart pattern. In this article we will discuss Forex channels and the way you can take advantage of them in trading.

What is Channel Chart Pattern

We have a channel pattern when the price is increasing/decreasing with the same intensity based on tops and bottoms. In this relation, two parallel lines could be drawn through the tops and the bottoms of the price action, which creates the channel.

Forex channels are an upgraded version of Trend Lines. The difference is that channels also suggest for how long an impulse could continue.

For this reason, channel patterns give you the opportunity to trade the trend impulse, as well as the correction. The reason for this is that the channel indicator suggests the end of the impulse and the beginning of the correction creating a fresh entry point on the chart.

Types of Channel Patterns

There are two types of chart patterns in Forex based on the direction of the trend: bullish channel and bearish channel.

The bullish channel represents price increase where the tops and bottoms are increasing with the same intensity.

The bearish channel chart pattern illustrates a price decrease where the tops and bottoms are decreasing with the same intensity.

Forex Channel Pattern Example

Now that you are familiar with the structure of the channel pattern, we will meet you with a real one on the EUR/USD chart. Take a look at the image below:Forex Channel Pattern

The two parallel blue lines illustrate a bearish channel pattern. The upper channel level acts as a resistance where the lower level acts as a support. Each time the price bounces from the upper or the lower level represents a tradable trading opportunity.

Forex Channel Breakout

Yes, but that’s not all about Forex channels. There is another lucrative trading opportunity that appears during channeling price moves. This is the channel breakout in Forex.

Every trading channel comes to its end at some point. This usually appears by a visual breakout on the chart as shown on the image above. Since the channel is broken, we have an indication that the price is eventually willing to change its direction.

So, a bearish channel broken through the upper level is an indication for an upcoming bullish move.

Opposite to this, a bullish channel that is broken through the lower level hints that the price might eventually start a decrease.

In both cases, this is an opportunity to enter the market against the previous trend and to try to hop in the beginning of a potential reversal.

7 Techniques for Successful Forex Trading

Most of the currency traders nowadays fail. Statistics show that 95% of the Forex traders end up with Forex loss. Trading is not an easy job as you may think. It is a serious initiative and you better step back if you relate this job with girls, alcohol, parties and so on. If you still want to proceed, then we will tell you how to implement successful Forex trading. It is all about gathering the right tools and use them the right way with the right mindset.

Forex Trading Nowadays

Most people prefer Forex trading while others like me prefer being an affiliate Forex partners. I will explain myself why I prefer being an affiliate, not a Forex broker.  Most of Forex Traders trade currencies, indices, agricultural and energy commodities to make a profit, they sometimes go long sometimes short, and others are day traders. Forex trading can make you or sometimes break you, It is not a field of chances. You must know exactly what you are doing before making it in this field. Or else, you might find yourself losing a lot of money when hoping to generate more.

Forex trading is not like gambling where you predict your bets. That is why every registered Forex broker will give caution to their website footers stating that forex trading is not suitable for everyone e.g. “Do not use what you cannot afford to lose!” However, in this article we will try to give some strong points and low points about the successful Forex trading.

Tools Successful Forex Trading

  1. Use Economic Calendar – Most forex brokers have their own analyst who will draft an Economic calendar. However, using the calendar makes successful Forex trading very easy to achieve. You will know when to buy and when to sell specifically it works perfectly if you’re going long and short. An economic calendar will give you dates of any countries economic events. It’s like a GPS or a navigator to where you are going – it will lead you.
  2. Listen to news – listen to countries news that may affect the economy and apply those changes to your trades. For example, if the country changes the president it’s a positive case that the investors will lose confidence and that countries currency will depreciate significantly.
  3. Compare trades of other traders – I normally call this mirror trading. You copy trades from other successful traders. Your Forex broker will always show you how are other traders doing or performing. People who have made success in forex trading are likely to continue creating success. Remember not to be a greedy trader. Trade slowly, build your account very slowly, and that will pay more than being aggressive and lose all your invested capital. I only advise this to those who are still learning. But if you have knowledge why would you copy from others?
  4. Advantage trading – This strategy involves trading according to an event to happen. Here, you can generate money quick, and when the event is done you then close the deal. It’s enough for the event until other events.
  5. Forex trading strategy – most successful Forex traders have their own Forex trading strategy. Some may share them, while others will not share their successful system. You can build your own strategy by comparing different strategies. Some traders use forex scalping, other use forex hedging, other use forex robots, and other analyze charts.
  6. Get advice from the broker – Some brokers are willing to advise whether to go long or short. It may be very helpful trading under the advice of experts rather than being confused about which trade to open. Also, it can be very beneficiary since the Forex brokers have the knowledge and expertise in forex. They have a team of experts or analyst who study the market
  7. Demo Account – If you are not so sure about your trading abilities and you have a strong feel that you still need more study, you may then start trading with a demo account. This is a practice account that will help you understand the market in a better way without losing any money.

Conclusion

Successful Forex trading is not that hard to achieve. Although the statistics shows that only 5% are actually profitable on Forex trading, it is not impossible to be among these people. You should simply have the right instruments in your toolbox. When you combine these in the right Forex strategy, the proper risk management and the right mindset, there is no way you will fail!

Provided by ForexAfrica

Trading the News and the Economic Events Effectively

Trading the news is one of the more effective methods of Forex trading because it often requires less expertise when it comes to technical analysis. As binary options trading becomes more and more attractive to Forex traders, it’s important to know that this same concept can be applied in your trades, but adjustments need to be made if you want to be successful. Using the same techniques will not bring you profits.

Let’s take a look at what adjustments need to be made and why.

The Differences

First, we need to see why the same methods will not be effective in binary options trading. Binary options have expiration times, called expires. In other words, you have very little (usually no) control over the trade once it’s been executed. Those that are new to binaries often lose money not because they don’t understand the trades they are making, but because they don’t understand just how powerful expires are. Choosing the right expiry for the trade that you make is key. It’s no different when you’re trading the news.

In Forex trading, you can choose to end trade with a partial loss or a partial gain. Unless you are using an inappropriate amount of leverage, you will never lose all of your money on a single trade. In binary options, you will lose all that you risk if your trade prediction is incorrect.

These two differences are huge, but they are easy to compensate for.

Making Smart Choices

Being an effective news trader in the binary options market involves making smart decisions when it comes to risk management.

Accounting for expiries is the first half of making smart choices. Expiries add an element of uncertainty to the outcome of your trades. If you take out a 60-second option, even if the direction of the trade is certain, there will be a high degree of volatility because of the short-term nature of the trade. If you take out a 30-day option, the impact that the economic event will have is negated by other factors. A happy medium is a must.

While the expiry will vary based on the magnitude of the news event and the pair involved, it is important that you stay in the 5 to 15-minute range when trading. This is where trading the news is most effective because of the degree of certainty that you will have on the outcome. Also be sure to look at the usual technical indicators so that your timing is as strong as possible.

Some economic events will influence price for a few hours, while others will influence price for a few minutes. Be sure that you know which event you are trading so that you aren’t trading the news when it isn’t having an influence on prices.

Always remember that trades must be small. While it’s okay to risk more when you are not losing all of what you risk, binary options are an all or nothing trade. If you have an account of $1,000, you would never risk $10 with the leverage of 100 times. As soon as the trade moves against you, you’ve lost all of your money. In the same way, you would never risk $1,000 on a single binary trade if you only have $1,000 in your account. The general rule of thumb is to never risk more than 2 percent of your account on any one trade regardless of how certain you are of the outcome. Volatility and variance in the binary options market are far too high because of the addition of the expiry.

Timing is the second half of this. If you choose the wrong expires, you are immediately putting yourself at a disadvantage. Unfortunately, this is a lot harder to get a good answer for than the first issue. Different magnitudes of news will impact currency pairs in different ways. For example, if the Federal Reserve raises interest rates by 0.5 percent by surprise, this will impact the price of the EUR/USD in a different manner than if it raises rates by 0.25 percent at an expected time. One will be a surprise and markets will adjust suddenly. The other will likely not have as much of an impact because of the expected nature; the markets will likely have already mostly accounted for the change in rates.

The best way to approach these differences is to see the past rates of similar news. Keeping historical records of the impact that the economic release has had on the particular pairs that you focus on will be your best bet so that you have a reference point to work from.

A Word on Robots

A lot of Forex traders rely on robots through their MetaTrader accounts. As automated trading begins to catch on in the world of binary options, it’s only natural that Forex traders begin to branch out and start using these tools. However, when it comes to trading the news, robots often are not as effective in the binary options market.

To understand this, take a look at how trading robots work. They look at pre-programmed technical signals and then make trades based on certain conditions.

This works to your advantage, but only if you are proactive. In the world of Forex trading, trade success is determined by the number of pips that the price moves in your advantage, so trading robots tend to be a lot more discerning when it comes to opening positions. They target trades that have signs showing significant growth.

Binary options robots tend to work differently. Not only do they look for direction instead of strength, but they also have expires to worry about. Trades do not end when they are in the trader’s favor, but rather when the broker says that time’s up. This adds an extra element of uncertainty to trades, and as such, can work against a trader. Being selective where trades open by using a robot is the best way to tilt the odds in your favor. The whole point of robots is to have a hands-off approach. But this just doesn’t work the same if you are hoping to use the news to help determine your success.

Trading the News

We trade to make money. We’re in the market because we want to grow financially, setting aside the fun and the excitement of trading. The news is one of the more effective ways to grow your money, but that doesn’t mean it’s easy. Whether you’re in the binary options or the Forex market, the effective strategy will be your profitable trading outline. Hopefully, the information presented above will give you a good foundation for making smart choices if you are thinking of transitioning from the Forex market to the binary options market. There’s a lot of potential here, but only if approached correctly.

4 Best Binary Options Trading Strategies that Work

Binary Options online trading is one of the famous trends in the pecuniary markets today. Both proficient and amateur traders are hurrying to incorporate them in their investment files. Same as to any other trading policy or business, you should have a game plan to use for making steady profits. In this relation, it is essential to approach some of the best binary options trading strategies that work.

How to Trade Binary Options Successfully

In the case without a tactic or technique to assist you in making money with binary options, you should see yourself betting. Depending on fortune is not pretty safe in binary options day trading. This is so because in the long run it will not be working for you and might wind up in losing the majority of your investment. You will require a dependable method that you can utilize all the time, which shall assist you to make the right forecasts. To trade binary options with success, you have to utilize a binary options trading and a system that you know well. If you test it and prove its positive odds, it is likely to steadily boost your odds of winning

Now let’s discuss some of the best binary options trading strategies that work.

1. Principal Analysis Methodology

This system involves the study of the conducting the entire performance or qualities of an organization e.g. fundamentals. As a binary options strategy trader, you are very interested about a sound balance sheet, the cash flow statement and the income statement of the organization before thinking about purchasing an option. When trading binary options with fundamental analysis, alternate elements that you ought to look at incorporate the worker and the business accomplices’ fulfillment. Basically, this methodology scrutinizes the total picture of the business they need to invest into their stock and on occasion the complete industry.

2. Technical Scrutiny System

This is a very famous procedure in option trading. It chiefly involves the investigation of the past, utilizing diverse parameters, for example, charts to anticipate the future cost of an asset. It’s very helpful in option trading in light of the fact that as a trader, you don’t need to dig into the organization’s financial statements.

3. Primary Options Systems

This technique is much famous amongst option traders. It is composed and utilized by a trader to defend himself from sustaining a total loss on their ventures. You shall pick an elementary asset or money that you are keen on and after that if the market is heading towards a good course, you can put a call option. In the meantime, you can place a put option in the same resource.

4. Money Administration Strategy

Without a right money administration, even the elite binary options trading system will destroy you in the end. Every binary options winning strategy is likely to lead to losing few trades. Accordingly, the primary objective of your trading approach can’t be to win every trade, yet to win adequate trades to wind up with a net gain at last. Money administration is the instrument that shall help you accomplish that.

Great money administration comprises of various guidelines, above all that you ought to just contribute a fixed little rate of your total capital in a trade. A precise money administration shall assist you to survive loss and make a consistent gain.


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6 Ways to Recognize Legit and Trustworthy Forex Broker

Forex offers a tremendous amount of opportunity and can be quite lucrative, but to make the most of this opportunity, you need a good Forex broker you can trust. After all, you are relying on your broker to help you reach your future financial goals. Therefore, trust is essential. You must be certain your that you are using a legitimate and trustworthy Forex broker, and above reproach.

No one wants to find themselves in a situation to discover they have lost their investments because they relied on a scam forex broker. The good news is that with some research, you can find a legitimate Forex broker to assist you with your foreign exchange investments.

Below, we will share tips to assist you in finding out whether you are working with a trustworthy Forex broker or you should keep looking.

How to Recognize a Trustworthy Forex Broker?

Scam Forex Broker

Before we begin exploring how to determine if you can trust your Forex broker, it’s important to point out that it is relatively easy to verify if a broker is licensed and legitimate.

If you are trying to verify your broker’s credentials and you have found it is difficult to get the answers you need from your broker, or you are not able to verify his or her credentials through independent sources, this should be considered as a red flag. You should stay away from such brokers in order to avoid Forex legal dispute

Below you will find the 6 ways to distinguish a trustworthy Forex broker from the scam Forex brokers:

1)   Research Independent Reviews

Reasearch Forex Broker License

The first step in checking out your Forex broker is to look into independent reviews. Online research can prove to be a veritable gold mine when you are trying to verify the credentials of any professional, including Forex brokers.

While it is inevitable that your broker will have had at least one unsatisfied customer, you should be able to get a good overall picture of your broker’s legitimacy by reading through online reviews. Keep in mind that the rating your broker has will be based on reviews posted by both past and current customers. This will give you the opportunity to gauge how satisfied the broker’s clients have been with its service.

In reading through reviews, be on the watch for red flags or warning signs that might include patterns regarding complaints, such as the inability to communicate, hidden fees, etc. A lot of negative comments or reviews should be considered cause for concern.

Even if your Forex broker is licensed, that is not to say that it is a good Forex broker. If some customers have reported having negative experiences with that broker, it is likely best to avoid it.

At the same time, if your broker has received some positive comments with relatively few negative comments, your broker is likely one you should stick with. Even the best Forex brokers will usually have one or two negatives regardless of how great their service might be, but if the majority of the reviews indicate good service, you can usually weed out the negatives.

2)   Check with the SEC

SEC Forex broker License

Wondering how to check Forex broker license? Easy! A licensed Forex broker will need to register, by law, with the Securities and Exchange Commission or SEC in the United States. In the UK, it will be required to register with the FSA. If you are in the United States, you can also check with the Central Registration Depository or CRD. This is a computerized database that keeps records regarding not only all broker registrations but also any disciplinary actions a broker may have received. This database will also give you information about the broker’s education. Since this database is designed to be completely neutral, it can give you a solid idea of your Forex broker license and background.

3)   Ask Around

Are any of your friends, family members, or colleagues involved in Forex investing? If so, ask them for their personal recommendations. This can be a particularly good idea if you are new to Forex and do not know where to turn to find a trustworthy Forex broker.

4)   Interview the Broker

Interview the Forex Broker

When searching for any professional, it’s always a good idea to speak to him or her directly. It’s amazing how much information you can obtain from a personal conversation. Consider asking the following questions when choosing a Forex broker:

  • How does the Forex broker Work?

For instance, what are the Forex broker spreads? What is the Forex broker commission for all of your investments? How is the broker earning money? Brokers with commission are less likely to be a scam Forex brokers since the commission is additional income for the broker.

Although it sounds like a paradox, the more the Forex broker fees, the less likely is so be scammed. A good Forex broker profits from spreads, fees, and commissions, e.g. legit Forex brokers are making money when you are making money trading Forex. Opposite to that, scam Forex brokers profit from your misfortune.

  • What is their preferred method of communication?

Everyone has different communication styles, and it is important to choose a Forex broker that will communicate in the manner you prefer. Some brokers are comfortable with only phoning their clients once a month while others will just send out emails. Still, other brokers may leave communication entirely up to their clients. Most trusted Forex brokers have a completely open-door communication policy.

  • Do they offer a Demo Account?

A reputable Forex broker should allow you to open a demo account that you can use for practice. If your broker does not do this, you should keep looking for a good Forex broker.

  • What is the Forex broker minimum deposit?

Different brokers will usually have different minimum requirements for deposits, so it’s important to find a broker whose deposit requirements are clear.  A reputable Forex investment company will provide this information in an easy-to-understand way.

Contrary to this, a Forex broker scam is usually related to vague information and hard-to-understand content, hidden behind the complicated legal information.

  • How up to date is the broker regarding technology?

A reputable and trustworthy foreign exchange broker should provide several trading platforms. Most of the leading Forex brokerages today offer apps along with web-based platforms. A legit Forex broker offers many trading channels for satisfying the needs of the trader.

5)   Customer Support

Forex Broker Customer Support

What level of customer support does the broker provide? Slow customer support indicates you are not important to the broker. If you should run into issues, there likely will not be anyone to help. It’s better, in the end, to pay slightly more in fees and know that you have someone to help if you encounter problems.

6)   Leverage

High Forex Broker Leverage

If the broker you are considering offers additional leverage if you agree to sign up within the next day, this should be considered as a red flag. A Forex broker will usually only use this type of tactic if it is trying to get you on the hook before you have had sufficient time to perform due diligence. A trustworthy Forex broker simply will not need to resort to such tactics because they can obtain customers through quality service and word of mouth.

Conclusion

Finding a reputable Forex broker that is trustworthy and legitimate is vital to your Forex success rate. Every trade you make will be affected by your broker. This is your money and your future, so it’s worth taking the time to find a reliable and licensed Forex broker to assist with your investments.


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3 Best Automated Forex Trading Systems that Work

Auto Forex trading is getting more and more popular with the time. Every Forex auto trader is working harder and harder to improve his automated Forex trading strategies. But have you ever wondered which are the best automated Forex trading systems? If yes, then you have landed on the right page. Today we will name three automated trading systems and strategies that work. But first, let’s do some basic rehearsals.

Why Engage in Forex Trading?

Foreign exchange trading and other financial market activities are becoming increasingly popular. Some people are doing it for a living e.g. brokers and professional traders.  Others consider it as a way to earn passive income or to gradually build up long-term investments. Still, there are others who get into it for the thrill and experience of online trading.

Who Can Trade?

Fast-paced technological advancements allow trading to continuously widen its doors and accommodate all sorts of traders. Corporate entities and individuals, regardless of financial status or location, can engage in the trading business. With either huge amounts of resources and investments or with just modest money on hand, anyone can trade from anywhere around the world.

What is Automated Forex Trading System?

Automated Forex trading systems involve trading where separate trades are executed based on computer algorithms. Automated trading uses computers and highly advanced online Forex trading software in monitoring trading opportunities and executing the transactions.



There are many ways to participate in the trading business. You can opt to use any of the auto trading solutions that have evolved in the market. The three best automated trading systems known are Algorithmic Trading, Copy Trading, and Mirror Trading so let’s go through each of these three auto trading approaches.

1)    Algorithmic Trading

Algorithmic Trading System

In case you wonder what is algorithmic trading, we have an explanation for you. The algorithmic trading meaning involves a lot of mathematical calculations. In algo trading, automated trading algorithms or instructions are entered as input by the programmer and analyst. Once certain conditions are met or satisfied and the limits set are reached, trading plans and strategies can be formulated.  Based on the trading plans, the computer automatically generates the automated Forex trading signals either to buy or sell.

To learn algorithmic trading systems you should also approach expert advisors (EAs) or auto trading bots. This is special automated trading software that every algorithmic trading system develops and makes use of, and can work 24/7. Such performance cannot be duplicated by humans without committing errors due to fatigue and other factors. Most of the algos used include parameters on volume or quantity, percentage, price, and timing of the trade. These indicators are highly critical to institutional traders. Thus, this type of trading is favorable to corporate traders. It can execute large trade orders in real time.

However, the computer being a machine means that it needs to be constantly monitored, as it can be subject to mechanical failure at any time due to power and connection problems.  As a pre-programmed device, it is also prone to programming and encryption errors that can cause large losses, if left undetected.

2)    Copy Trading

Copy Trading System

Copy Forex trading is the next Forex auto trading system that we will discuss. Copy trading is best for newbie traders who have not yet gained adequate knowledge and skills in the business. You are probably still wondering how does copy trading work. Here is a simple answer:

There are automated Forex trading platforms such as Zulu Trader where you can join and copy Forex trading strategies of the expert traders. In other words, your copy trade profit depends on the decision taken by the expert trader you follow.

This trading system is also known as social trading, as you can participate in a special Forex social network and communicate with other traders through the exchange of messages and ideas, as well as through access to live feeds and post, like, share and comment functions.

3)    Mirror Trading

Mirror Trading System

Another automated trading system that was introduced in the late 2000s is mirror trading. If you are new in trading, you can start as a mirror trader. You can do mirror trade by mimicking the trading strategies of successful traders.

Start by analyzing the trading pattern or behavior of the traders you want to replicate. Once you have decided on the strategies to adopt, then these are entered into your account, and you can then begin your mirror trading system. This can be set to auto trading in which case the computer executes the order automatically once the signal provider opens a position.



If you want to have more control on your account, you can set your mirror trading Forex system to semi-auto mode. Once the trading signals are generated, you can manually execute the trade.

Do Automated Trading Systems Work

Now that you know what is automated trading, you are probably asking yourself “Do automated trading systems work?”  They sure do. But first:

  • You should choose the best automated Forex trading system for you. You should learn how it works and how it applies to automated trading platforms.
  • You should plan, build, and code a successful automated trading Forex strategy that you want to systematize.
  • You should examine the automated trading services of your Forex auto trading software in details to minimize possible errors in trade implementation and strategy building.

Conclusion

In summary, you can decide to trade high or low.  You may also prefer automated over manual trading.  But be wise. Remember not to be swayed into using untested auto trading solutions, especially if they promise incredible profits. Choose a legitimate automated trading platform that has been adequately tested. Once you are comfortable and have access to appropriate trading strategies and tools, trading can be an interesting, rewarding, and satisfying venture.


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5 Tips on How to Become a Real Trader in Forex

“Just because you trade, does not mean you are already a real trader.” It’s as I can sing, but I am not a good singer. In trading, it sounds so easy to trade, but to call yourself a real trader might be a little harder. I bet you have wondered how to become a trader. I have 5 tips for you that real traders constantly follow. Approach carefully each of these guidelines if you are looking for an answer on how to become a better trader.

1. Real Traders Count on Training

They say practice makes perfect, but in Forex, training makes perfect traders. I remember when I was starting in Forex trading, I needed to have training, and it was too difficult because I had to do it all alone.

Now, it is so easy to have yourself trained with the help of the internet, and many sources like YouTube. Thus, if you want to become a trader, have yourself trained now.

2. You Cannot Become a Forex Trader without a Plan

You can’t always win a battle with just a sword and armor in your hands. Even Goliath lost to David despite the height advantage because the smaller one had a plan. The same thing goes with trading.

Although trading instrument and strategies are always available, you still have to have a clear plan. If you want to become a Forex trader with success, you should work around a plan that you follow strictly.

3. Bring Out Your Gun on the Forex Battlefield

When you eat, you need a plate, when you study, you need a notebook and a pen, and when you make love with your partner, you need your crown. They are three different things, but what do they have in common? TOOLS! Just like in trading, we need tools.

I have good news for you. We are in a world where technology seems to be even more advanced than the entire human race, and it is not bad for us to take advantage of it since we, humans, actually made it. The smartphone is the most common tool that we can use, but if you want a more convenient tool, go for a laptop or a computer.

In the past real traders have been trading without charts due to the absence of high speed communication services and visualizing hardware. The real trader nowadays has access to free trading charts that can visualize the price action of every financial asset just in a flash. It is up to you to pick up your Forex trading platform that will give you access to latest trading charts.

4. Find Your Soul Mate in Trading

We always expect our loved ones to say “I love you more” when we say “I love you” to them. That is because we naturally expect better words from them so that we can tell ourselves ‘Yes! I win!”

Good traders live with that mantra, “Yes! I win.” We don’t trade just to give money – we trade to gain more than what we give. And for you to be able to say “Yes! I win!” in trading, it is important that we find a good Forex broker – your soul mate in the journey of how to be a good trader.

5. A Real Trader Takes One Step at a Time

As the song says “Wise men say only fools rush in.’ Cliché might sound, but it is true that it is better to take things one step at a time. Good traders know that. In my case, I started out with small trades and I gradually sized up.

Remember that you have a plan, and it might be good if you include in it to take one step at a time. This is probably the most important segment of how to become a real trader.

Written by: Forex Alerts


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