Tag 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!

Reasons Why Most Forex Day Traders Fail and Lose Money

Here’s the truth – most forex day traders lose money trading forex. And, if you have tried it on your own you have probably lost money too. But why do forex traders lose money in most of the cases? I don’t know what happened in your situation that caused you to lose money. But I do know, in general, why day traders fail and what causes most people to lose money with forex.

3 Reasons Why Forex Traders Fail

There are three factors that I find for reasons why most traders fail, and I want you to do a “self-analysis” to see if this is happening to you too:

1) Greed

This is a tough one because none of us want to admit to being greedy. However, MOST of us are to some degree! If you find yourself making money with forex but always wanting to “make more” only to find yourself eventually losing money, then you are struggling with greed! Remember, greed is one of the most common reasons why newbie traders in Forex lose money.

2) Unrealistic Expectations

Most people like forex because of the volatility and quick movements throughout the day. For some, this is no different than the thrill of gambling in a casino. If you are expecting to turn $1,000 into $10,000 in 30 days or less, then you have VERY unrealistic expectations.

Your goal should be to steadily make positive gains day after day and let your account grow through compound interest. Give yourself a LONGER timeline to become successful. This will reduce the pressure at you, boosting your Forex success rate.

3) Poor Money Management

Put simply, this means trading too large of a position for your account size. If you are risking more than 1% of your account on any one trade, you are trading too large. I personally trade MUCH less than 1% per trade because it helps to lessen my risk even further. I recommend you do the same!

And while we are on the subject …

Is Forex Trading Gambling?

Many people who don’t understand what is Forex immediately label it as “gambling” and guess what, most of them are right! And the reason they are correct is that traders violate the rules that professional gamblers follow EVERY DAY without fail.

Is Forex Gambling

What are those rules? Here are just some of the pro tips I’ve learned over the years.

1) Never trade based on emotion

If you “feel” like a trade is going to go in a certain direction based on feelings alone then WALK AWAY. Leave emotion at the door! Pro traders place a trade for one reason only – they see an event unfold and they know with a high level of certainty that an outcome will repeat after that event (most of the time). They are playing an edge based on TESTING.

2) Never trade outside of your plan

This means you should trade the HOURS, the FOREX PAIRS and the TIME FRAMES you have decided that are best for your trading style. When you trade outside of that bad things happen. Don’t do it!

3) Walk away from your computer

Forex is not a “game” that rewards you for long hours. In fact, it usually works just the opposite. I guarantee that the more time you spend on your computer, the more trade setups, you will magically “see” and take. Taking MORE trades in forex will not reward you. Take just enough to make your profits and then WALK AWAY!

Now it’s your turn. Look in the mirror and decide if you want to trade forex for a living or let fear hold you back! Then, make a decision to take the first step to a life of freedom!

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3 Advanced Price Action Tricks Forex Traders Should Know

Forex traders who are aware of the secrets behind the advanced price action Forex trading can significantly increase their earnings. Knowing how to read price action is one of the most important trading concepts in the Forex market. Therefore, we have prepared this advanced price action tricks article, explaining price action Forex trading for dummies.

The advanced price action knowledge can improve the trading efficiency and the ability of the Forex trader to analyze trading charts. The problem is that there are a lot of action price rumors and misconceptions that confuse newbie traders and lead them to big failures. This article is going to share 3 of the most important price action tricks that will help you read price action. Now let’s see how to use the price action without losing in trades.

Resistance and Support Zones in Price Action Tricks

These two concepts pertain to the Forex charts and are the most popular price action concepts. The truth is that not many traders know the Resistance and Support secrets, and this interferes with making money in Forex. Many traders make use of single lines when looking for the resistance and support, which is wrong. They fail to catch the actual resistance or support zone during the live trade. This is because single lines are not as effective as referring to a zone/area when performing advanced price action analysis.

daily price action resistance and support

The above graph shows clearly a resistance and support zone as a whole area. The area is marked with gray on the chart. See that in the first half of the chart this area acts as a support, while at the second part of the chart it acts as resistance.

There are multiple ranges for which traders can target profitable deals here. A single line becomes too narrow and unrealistic in this case. For this reason, there is a great chance that you miss many good trades or open many losing trades by only relying on single lines when trading price action resistance and support.

Focus on Price Action High and Low Points

This is a very important point of the price action Forex trading because the high and low points tell us the strength of trends and the direction of the market. In many cases, daily price action highs and lows foretell trend reversals by signalizing about ending trends in advance.

The high/low analysis should be performed in combination with other price action trading methods like the resistance and support rules. The more you commensurate the information, the more reliable the results will be.

Another very powerful price action trick is when traders analyze the highs and lows with a trendline indicator. Below you will find three price action tricks which will help you understand the highs and lows beyond the normal Forex trading knowledge:

  • Identify long price action impulse coupled by small pullbacks. In most of the cases, this appears to be a strong trend.
  • Is the price trend hardly making any higher high and lower low? Maybe the market is telling you about fading momentum. This very often ends up with a trend reversal.
  • Look for the trend where the daily price action is making new highs and lows. This is a sign of volatility, and volatility is one of the strongest turning points in Forex.

Advanced Price Action Chart Patterns and Daily Price Action Setups

I will now meet you with a couple of the most famous daily price action chart patterns in Forex trading. These are the well-known Double Top and Double Bottom chart patterns.

We have a Double Top pattern when the price action creates two tops in the same resistance zone. The Double Top Chart Pattern comes after bullish trends and tends to reverse the price action. This creates bearish potential on the chart, which signalizes that you need to sell.

The Double Bottom pattern is opposite to the Double Top. We have a Double Bottom figure when the price creates two bottoms in the same support zone. The Double Bottom Chart Pattern comes after bearish trends and is known to cause reversals. Here, the created potential on the chart is bullish, which gives you a signal that you need to buy.

The Double Top/Double Bottom chart pattern is one of the most popular daily price action setups in Forex.

Correct Market Selection for Advanced Price Action Forex Trading

Many traders misunderstand the concept of the market selection and do not build a watch list before entering the markets. An effective market selection is highly advisable for the beginner and also the advanced price action traders. It is also highly advisable to look into the markets for crystal clear price action Forex trading figures. At the same time, make sure you avoid trading in markets where the price action is too unpredictable and noisy.

These advanced price action tricks will help many newbie traders to enhance their trading quality. If you have paid attention to these price action Forex trading tips, you will be able to pick markets that provide many trading opportunities.


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Forex vs Binary Options Trading

Forex or binary options? – that is the question. Every trader or investor has come across this question at least one in a life time. If you are a newcomer in trading, you can always ask somebody, who have already been there. However, if you have already tried trading either Forex or binary options and you failed, you are probably now wondering if the other alternative is the better one for you. The important thing is that we are here to help by comparing Forex vs binary options trading.

What is Better – Forex or Binary Options?

Yes, we are here to help you decide which type of trading would be helpful and suitable for you.  Both Forex and binary options have their pros and cons. But the first thing that comes to mind when we collate Forex versus binary options trading is the time of origin. While Forex trading has a very deep and sustainable history, binary options came into existence in 2008. Binary options now have a relatively small background and hence a great chance for growth.

Here we will discuss the reasons to choose Forex trading or binary options, according to their pros and cons.

Why Choose Forex instead of Binary Options

Forex Trading vs Binary Options

  1. The Forex trading offers a huge rate of liquidity. It helps investors to get rid of any swift fluctuations in the exchange rates.
  2. Traders have an opportunity to make a great profit by determining currency values.
  3. The Forex trading market is open throughout the day, so time period is not an issue.
  4. Investors get equal access to trade in a rising or falling market, according to their preference.
  5. Its best part of Forex trading vs binary options is that traders have full control over their investment.
  6. Forex trading fits better for experienced investors who know the market value and want to invest in larger sums. If you consider investing in currency, then here are the main Forex pros you need to know about.

Why Choose Binary Options instead of Forex

Call and Put Binary Options versus Forex Trading

  1. Binary options allow you to choose a wide range of assets like currencies, stocks, commodities and indices.
  2. Binary options are a new trading Thus, chances of winning remain higher.
  3. Another great advantage of Binary options versus Forex trading is that new service providers evolve daily, giving their services at lower price to attract customers.
  4. Trading binary options is relatively easy to understand and execute as you just have to predict whether the price of an asset will go up or down.
  5. The payout is fixed, so you always know what reward you are going to get if your prediction is correct.
  6. Binary options give you the authority to decide when you want to close your position. The trade expiration time is also decided by the trader.
  7. Some free trading software is available to assist binary options traders in their trading journey. You should select your binary options software based on reputation, customer reviews, shown at websites like Judge Binary Optionsand many others.

Conclusion

You must have got a pretty clear view which is the better trading technique for you to choose. Both binary options and Forex trading have their pros and cons, so it completely depends on you to determine which one suit you best. Like any other investment, education is the key to success, thus making a right plan, knowing your strengths and weaknesses and putting 100% effort is important to be in the best position to succeed.


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Fundamental Analysis of Binary Options Trading

Given the short-term nature of most binary option trades, there seems to be an emphasis on technical analysis over the fundamental analysis of binary options. This sometimes neglects the importance of the intrinsic value embedded in the asset. For this reason, today we will put emphasize on trading Binary Options with fundamental analysis.

Factors Affecting the Fundamental Analysis of Binary Options

Fundamental analysis in binary options is usually neglected because fundamental factors take a longer time to materialize. Examples of fundamental factors include the PE ratio, the price/book, enterprise ratios, etc. The binary options fundamental analysis also takes into account external factors that could have an effect on the price of the security in the future, such as macroeconomic factors. These factors range from the current interest rate to political impacts, from GDP growth to consumer confidence.

Use of Fundamental Analysis in Binary Options

The most important question that needs to be addressed, however, is how a trader makes use of fundamental analysis in binary options when making decisions related to binary options trading.

Use of Fundamental Analysis in Binary Options

This is made even harder by the fact that some platforms only offer technical tools and indicators for the trader and the fundamentals are left behind. This is why many traders choose to use third-party platforms such as the Meta Trader 4 which pulls in more fundamental factors.

The Meta4 platform has extensive information on global macroeconomic variables when it comes to Forex. This could impact the currency pair being considered. For example, I always look at the consensus estimates for inflation variables in the UK and compare that to my own estimates. I am then able to position my GBP/USD trade to most appropriately make a profit depending on where the actual inflation number prints. I also look at factors such as China’s growth in determining the demand and price of iron ore and hence also the Australian dollar. When completing these fundamental trades with binary options, the shortest expiry time I take is a 24-hour option. Choosing a shorter expiry time tends to create too much noise around the fundamental analysis binary option.

Where to Get Binary Options Fundamental Analysis

Fundamental analysis of binary options is restricted to macro-economic when investing in currency. In comparison, when looking at stocks the underlying company can also be analyzed. Unfortunately, Meta Trader 4 does not offer much of the companies’ fundamentals. This is where other news services such as Yahoo finance are quite helpful.

Stock Binary Options with Fundamental Analysis

From learning stock trading you probably know that companies with a lower PE ratio are cheaper relative to earnings power. Assuming that the growth opportunities look promising for the company, it may be advantageous to enter a fundamental binary option trade over a longer time period such as six months or even one year. This will allow the efficient market to eventually price in the discrepancy that you observe. For example, before I placed a 6-month binary call option on the Barclays stock, I noticed that the PE ratio was quite low compared to it’s peers. Barclays is also going through substantial restructuring which could unlock further synergies in the bank going forward.

Another important indicator of binary options fundamental values is the type of investors who are purchasing the stock. Unlike many assets, if an investor takes a large stake in a particular company then they have to disclose it. Hence, if you were considering placing a binary option trade on a company and an investor such as Warren Buffet was also increasing his stake in the company at the same time, then you would have more conviction in your fundamental viewpoint (Mr. Buffet’s bread and butter).

Technical Analysis VS. Fundamental Analysis Binary Options

Technical VS Fundamental Analysis Binary Options

Of course, what most good traders do is to use not only one form of analysis. Although I tend to use fundamental analysis to inform a lot of my binary trading, I am always observing the technical indicators over a range of time scales. Despite less useful over a longer time period, technical indicators could give an indication of the short-term direction of the currency value or the stock price. This will allow you to better time the entry of your long term fundamental binary option trade.

If you would prefer to confer with a professional before trading binary options with fundamental analysis, there are some managed account and signal services available.

Written by Alex Wissler – Trader, and author at Binary Trading Club, a large membership based community of like-minded traders.


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Forex Arbitration: Traders Rights in Forex Legal Dispute

As you may know, Forex opens not only alluring prospects of financial gain but also involves substantial risks. Conflicts over order execution occur between the parties involved in a transaction (the broker and the trader) all too often. Therefore, traders often get involved with Forex arbitration claims and Forex legal disputes. One should always know the traders rights during a Forex dispute resolution. Therefore, we have created this article explaining the trade laws and how to apply them.

Trade Laws and Forex Arbitration Claim

In most jurisdictions, local trade law regulatory authorities oblige Forex brokers to take part in independent Forex dispute resolution systems. The reason for this is to protect the traders rights in situations when a Forex arbitration conflict cannot be resolved through negotiations between the FX broker and the client. The best-known Forex dispute resolution systems are represented by trade laws enforcing bodies like the Financial Ombudsman Service of the United Kingdom of Great Britain and Northern Ireland, the Financial Dispute Resolution Scheme of New Zealand, the Financial Ombudsman Service Limited or the Credit and Investments Ombudsman in Australia, and so on.

Forex Trade Law Forex Dispute Resolution

Independent Forex dispute resolution systems are organizations that act as intermediaries between brokers and their clients. Forex legal dispute systems can be organized by the state or by traders themselves for the benefit of other traders. An example of the latter is the Financial Commission.

Conflict resolution through independent Forex arbitration has a few differences as compared to Forex legal proceedings in the country of the broker’s incorporation.

Firstly, it is free. When filing a lawsuit in court, a trader will have to pay an official fee, but lodging a complaint with an independent Forex dispute resolution system does not cost anything to the trader. In fact, financial costs of a Forex dispute processing are carried by the broker. Being part of an independent dispute resolution system is mandatory for maintaining a brokerage license, and brokers pay annual membership fees for it.

Secondly, according to the trade laws the Forex arbitration decision is binding for the broker, but not for the trader. Therefore, if the trader is not satisfied with the decision taken by the dispute resolution system, he can utilize other ways of finding a solution to the problem, including taking Forex legal action.

Traders Rights during Forex Arbitration and Forex Legal Disputes

Filing a Forex arbitration claim is an independent and objective process to pursue Forex traders rights. The broker and the trader are equal in presenting their cases to an independent Forex dispute resolution system. It means that the broker cannot influence the outcome of the Forex arbitration. The appointed mediators, who are neither employed by nor affiliated with the broker, will make a decision on a case.

Forex Legal Traders Rights

While investigating a Forex dispute case, the mediators will take into consideration all the evidence provided by the parties, including account opening agreements and other regulatory documents. That is why we recommend making a careful study of these documents before filing your complaint to Forex arbitration.

The trade laws state that arbitration accepts your complaint only if the means of Forex dispute resolution through the broker’s internal policies have been exhausted. The mediators will check which steps have already been taken by the parties to settle the conflict.

You should also keep in mind that the financial compensation, which can be offered by arbitration is limited. Some independent Forex dispute resolution schemes set a maximum amount to be awarded to the trader if a claim is settled. Also, other independent dispute resolution schemes have the minimum compensation limit. It means that they will not investigate Forex disputes of less than the minimum limit amount.

Most Forex dispute resolution systems publish case reports and decisions on their websites. Each case report includes a brief overview of the trader’s complaint, the broker’s viewpoint and the Forex legal decision taken by arbitration. As most Forex disputes appear to be quite similar, we assume that anyone who takes an interest in Forex trading will find this article useful.


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Affiliate Forex: Why Choose the Forex Affiliate Network

The affiliate Forex is one of the options to make money from Forex without actually trading currency. You will be surprised by the role of the Forex affiliate network for the success of the trading industry. This article gives a brief explanation of how the Forex affiliate programs work.

Importance of the Forex Affiliate Network

The truth about Forex and binary options markets is that their major success is due to an army of Forex affiliate deals. In case you need brushing up on your internet marketing vocabulary, the Forex affiliate network is simply based on individuals who promote a product or service in exchange for a fee from each recommended sale.

Forex Affiliate Network

All affiliate Forex sales are tracked by special tracking software. This software is often arranged by a third party and tracks the journey of each link that conducted a Forex affiliate sale.

Why Choosing Affiliate Forex

Forex affiliate marketing is a big business online. There are tens of thousands, online affiliates who focus mainly on binary option and Forex affiliate programs. The main reason is that every Forex trading affiliate program pays a lot more than other affiliate solutions. For example, the Forex broker affiliate program of 24option suggests that whoever sends a customer that makes a deposit, is paid $200. Also, there a good potential to negotiate your deal if you can send more traffic and sales. The average Forex affiliate marketing program pays out usually about $29.

Money is an obvious pull factor to most Forex affiliate partners, but it’s not the only thing that appeals to most of them. Most brokers who offer Forex partnership programs also have an extensive library of marketing materials that can be used by affiliate Forex partners. These often include marketing banners in all shapes and forms, videos, email swipes to be used in email marketing campaigns, and even separate sales pages that can be used in targeted campaigns.

Forex affiliate partners bring in massive traffic to Forex and binary brokers, being responsible for the huge amount of sales. Brokers often reward their best Forex affiliates with luxurious gifts or sponsored trips to make them feel like part of the company.

Affiliate Forex Luxury

It is said that the master affiliates who bring most traffic and sales are worth their weight in gold.

Conclusion

  1. Forex affiliate marketing is a very big business online.
  2. Most of the business in the Forex trading industry is driven by Forex affiliate programs.
  3. The Forex affiliate network is away to profit from Forex without actually trading the currency value of the Forex pairs.
  4. The affiliate Forex business consists of individuals, who engage people to trade and drive traffic to brokers.
  5. Forex affiliate partners are rewarded financially and materially for the traffic they generate.
  6. A good Forex broker can pay up to $200 for every new attracted trader that made a deposit.
  7. Best Affiliate Forex partners are sometimes rewarded with luxurious gifts and vacations so that they can feel part of the company.
  8. It is said that the master Forex affiliate partners, who bring most business, worth they weight in gold.

About the author:

Adam Teen is a Forex and binary options analyst. Founder of WinAtBinaryOptions


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MW Patterns in Forex: Double Top and Double Bottom

Today we will talk about Double Top and Double Bottom a.k.a. MW Patterns – old fashioned patterns that are constantly drawn on trading charts in Forex. Double Tops and Bottoms happen on a regular basis on low time frames like (M30 & H1). M&W Patterns on higher timeframes (H4 & D1) are more reliable, but it does not happen that much. Switch to the next paragraph if you want to know more details about the Double Top Double Bottom MT4 Indicator.

MW Patterns – Double Top and Bottom

Double Top and Bottom MW Patterns are repetitive structures which the price creates during the cycle moves. Therefore, we divide the MW Patterns into two types: M pattern, which is also known as Double Top chart pattern, and W Pattern, which is also known as Double Bottom chart pattern.

M Pattern – Double Top Pattern

An M Pattern is the way the market is producing a Double Top pattern, creating a resistance zone on the chart. The price creates two tops on the same level and starts a decrease. The pattern appears after a bullish price trend and can reverse the tendency. A short trading opportunity opens with the Double Top pattern.

M Pattern Double Top Chart Pattern

This is a Double Top Chart example – the M chart pattern. The two tops of the M pattern are marked with the black spots on the chart. In the time of the second bounce from the yellow resistance area, we get a Hanging Man candle pattern, which has reversal functions. This confirms that the price will probably start a decrease. See that the second bounce from the resistance level leads to a price drop, which could be traded short.



At the same time, there is a second opportunity on the chart. The level indicating the bottom between the two tops is called a Double Top Neck Line. If the price action breaks the Neck Line, then we can pursue a further target downwards. The minimum expected move after a Double Top Breakout would then be equal to the distance between the resistance level of the Double Top and the bottom between the two tops. As you see, the price action completes this move afterward.

W Pattern – Double Bottom Pattern

On the opposite side, when the chart draws a W Pattern we have a Double Bottom pattern, where the price action creates couple bottoms in the same support zone. The Double Bottom pattern appears after bearish trends and is known to reverse the price action. In this relation, the Double Bottom chat pattern often leads to increase in the price action. When a bullish price bounce appears after the creation of the second bottom, this is likely to bring the price increase. This is the case when Forex traders have the opportunity to go long on the Double Bottom chart pattern.

W Pattern Double Bottom Chart Pattern

As you see, the W formation is the same as the M chart pattern, but upside down. The W pattern is a two bottoms one top figure in the time of the consolidation, in comparison to the M pattern, which has two tops and one bottom. In this relation, the Double Bottom rules are also opposite to the rules of the Double Top chart pattern.

The two black spots on the chart mark the two bottoms in the support zone of the Double Bottom chart pattern. In the time of the second bounce, we see the formation of Double Engulfing candle pattern, which consists of 3 candles – a small candle, a bigger candle that engulfs the first one, and a third candle, which engulfs the first two candles. This pattern is known to have a strong reversal potential. Therefore, it could be used to buy the Forex pair on the second bottom of the W pattern.

When the price bounces are upward creating the second W bottom, we have a nice long opportunity on the chart. If the level at the top between the two W bottoms breaks afterward (Double Bottom Neck Line), then you can trade the Double Bottom breakout for a further price move equal to the size of the W pattern. This is shown with the couple pink arrows on the Double Bottom Chart.

Double Tops and Bottoms Trading

The Double Tops and Bottoms trading are one of the most common approaches to profit from chart patterns in Forex. Experts in Forex trading have determined a Double Tops and Bottoms success rate of around 70%. This means that in about 70% of the cases the price action will bounce from the support/resistance area, breaking the M&W pattern Neck Line and creating a further move equal to the size of the MW pattern. Therefore, if you trade properly the Double Top and Double Bottom chart patterns, you will have the opportunity to profit from the currency value of Forex pairs.

W Pattern Example – Double Top Chart Pattern

In the video, we demonstrate an M pattern on a MetaTrader chart. We entered a short trade on the M top.

Since we are interested in these patterns, we notice a particular point where the market could react. It’s, in fact, the key level to watch for further direction confirmation or time to reverse the initial position. I called it “CP” Center Point. It’s the middle price level of the structure of Double Top chart pattern. I placed a Take Profit on that “CP” level.

Another great thing about our M pattern strategy is the Risk/Reward potential of the Double Top. Our Stop Loss order is always tight as we are supposed to enter on the bounce from the resistance level at the top of the M pattern. If the market goes opposite to the trade and breaks through the Double Top resistance, it is pointless to keep the position alive.

The Double Bottom Chart Pattern a.k.a. W pattern works the same way, but in the opposite direction. In this relation, you should use the bounce from the second W bottom to enter a long trade and to buy the Forex pair. Then you can pursue the Center Point of the Double Bottom. If then the price action breaks the top between the two bottoms, you can also shoot for additional bullish price move equal to the size of the W formation.

M&W Patterns Indicator for Double Top and Double Bottom

Below you will find a link to an M&W Patterns indicator for the famous Meta4 trading platform (MT4). This Double Top Double Bottom MT4 indicator draws the patterns automatically on the chart, so you can recognize them easy. You can download the M&W Patterns Indicator for free until the end of December 2016.

Conclusion

  1. MW Patterns refer to Double Top and Double Bottom figures in Forex.
  2. M&W Patterns are among the most commonly used in trading.
  3. The M Pattern responds to Double Top Chart Pattern:
    • The price creates two tops approximately in the same resistance area.
    • After the second top, the price action starts a down run.
    • If the level at the Double Top Neck Line breaks, this creates further bearish potential equal to the size of the Double Top pattern.
  4. The W pattern refers to Double Bottom Chart Pattern:
    • The price creates two bottoms approximately in the same support area.
    • After the second bottom, the price action starts an up run.
    • If the Double Bottom Neck Line at the top between the two bottoms breaks, this creates further bullish potential equal to the size of the Double Bottom Pattern.
  5. Double Tops and Bottoms provide a success rate of about 70%.
  6. Double Tops and Bottoms give the opportunity to place tight Stop Loss orders, which reduces the risk taken, compared to the potential of the MW pattern.
  7. Trading MW Patterns in Forex can make you a successful trader.

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Trading Charts: Currency Exchange Chart Rules

Learning to handle trading charts is definitely not optional for the modern Forex trader. There is no way around Forex markets without analysis and strategies, all of which rest on – you guessed it, Forex trading charts. Forex charts analysis involves searching various currency exchange chart types for Forex chart patterns that will help traders predict future price action. Therefore, in this article we will discuss the rules of the currency exchange chart.

Not only do traders need to be able to perform accurate Forex chart analysis, but they also need to know how and where to procure the latest and most accurate live Forex charts. It does not really matter which type of foreign exchange rate chart they prefer. As long as they are accurate, the only major difference is in the presentation on the exchange rate chart.

Forex Trading Charts Types

We will now discuss the different types of Forex trading charts. First, we should say that there are three major foreign exchange charts used in trading. These are the Line currency chart, the Bar currency chart, and the Japanese Candlestick currency chart.

Line Currency Chart

For instance, a Line currency chart features all of the closing prices connected in a line so that you can follow the general direction of the price action.

This is how the Line Forex chart looks like:

Line trading charts

Above you see the Line USD currency chart versus the Euro (EUR/USD). As you see, the Line currency exchange chart is pretty basic, and the information it gives is not that much. This is why the Line trading chart is not widely used among the Forex traders.

Bar Currency Chart

The Bar Forex chart will compress all the relevant information in a bar, with some hashes on the side, and each one will be a story for itself. Whether they are hollow or filled, long or short, and where their hashes are – all of these things can tell you something, provided you know where to look.

Bar currency exchange chart

This is absolutely the same time frame as the previous image. However, this time we use Bars for our exchange rate chart instead of Line.

Generally, each bar on a Bar trading chart represents the size of the price move during the respective period.

Bar currency chart

This is an example of a single bar, which is bullish. There are couple dashes on each side of the bar. The left dash of the bar is the opening price of the period. The right dash is the closing price of the period.

Since the bar is bullish, it is green, and the opening price is below the closing price. If the bar was bearish, it was going to be red, where the opening price is above the closing price.

Japanese Candlestick Currency Chart

Finally, the most widely used type of trading charts is the well known Japanese Candlestick currency exchange rate chart. These will provide all the relevant data, only in a form that resembles a candlestick rather than a bar – hence their name. One look at a candlestick trading chart and a trader will be able to read the general direction of a trendline Forex indicator, provided there is one.

Japanese Candlestick USD currency chart

Notice that the Japanese Candlestick Forex chart is pretty much the same as the Bar currency exchange chart. The reason for this is that it visualizes absolutely the same information – Open, Close, High and Low during the respective period.

Exchange Rate Chart Japanese Candlestick

We approach a bullish Japanese Candlestick. Same as the bar, the candle is green, and the opening price is below the closing price. If the candle was bearish, it was going to be red, and the opening price was going to be above the closing price.

How Can I Find Foreign Exchange Carts

The most detailed foreign exchange charts are located inside the innovative Forex trading platforms. These platform could be reached either in the net, or by downloading an external software. After getting access to a trading platform like MetaTrader 4 for example, you will be able to implement detailed currency rate chart analysis, as well as different kind of trade automation.

Currency Exchange Chart Essentials

Modern foreign exchange charts are very appealing, albeit some of them are more popular than the others. Historical currency charts can be found online, and there is never a shortage of reliable sources. They are more than just a visual aid for traders. In combination with market indicators and Forex software, they can be put to lucrative effect. Just remember, these things are only as good as the trader interpreting them. There is no way to predict the future, and the only way to make an educated guess is with the help of live foreign exchange charts, at least when trading currencies.

Having said that, plenty of traders got burned over the years, and this created a lot of unnecessary tension, not to mention distrust. After all, getting an accurate exchange rate chart analysis and putting it to good use is nothing short of a form of art. But do not despair! Most brokers offer various reports and articles from analysts and experts, plus various educational materials, so learning a few useful strategies in combination with some solid trading charts know-how can and will get some real results.

Experience with Currency Exchange Charts

However, in order get results, you need to learn the basics of the trading charts available, including how to find, open and read them – and that is only the beginning. Next are various charting packages, tools, and accessories, some of which could prove disastrous if not handled with care. This is where the plot thickens.

The truth is there is no consensus on how a currency exchange rate chart should be interpreted, just like there is no consensus on a single, perfect Forex strategy. It all depends on a trader’s personal preferences, goals, and the overall trading style.

In fact, you could make an argument that there are as many ways of interpreting and using trading charts as there are Forex traders, as each of them has his or her own way of doing business, at least after they have learned the ropes.

Some prefer to base their trades on the feeling in their gut, although this is not recommendable to anyone whose instincts do not border on supernatural abilities. Statistically, most rookies go about with what little knowledge they possess on currencies and use trading charts only to gauge the general price direction. By the way, did we mention that these guys are probably behind the majority of complaints on Forex brokers and trading in general? Yes, because soon or later these newbie traders end up broke for not understanding the currency exchange rate chart.

A notch above is news traders, who base their major moves on large events and their outcomes, using foreign exchange charts mostly to confirm their suspicions. They rest their faith on various reports and trusted news outlets, although they seem to be forgetting one important fact. A lot of people also like to watch the news, and any information they learn had likely passed through several hands long before it was released. And even if they score an “exclusive,” chances are this outcome has already been factored in by the true masters of this game.

Hardcore professionals do not base their trades on hunches and rumors, but merely factor them into their own equations. This is where the currency exchange chart would really earn its keep, as the potency of its mixture with trading signals comes to light. True masters of this game do not use trading charts to predict trends. Rather, they try to predict actions of their competitors, instead – a far more lucrative and direct approach.

Summary

Being able to predict how the people will react to a certain development is far easier, not to mention more reliable than trying to predict said outcome. This approach is by far the hardest, but the rewards it offers cannot be ignored. All things being said, your foreign exchange rate chart has its purpose and that has been the entire point all along.


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Trendline Forex Indicator: How to Draw Trendline in Forex

The trendline Forex indicator is an integral tool of the price action in Forex. This material will teach you how to properly apply and trade the Forex trendline.

Trendline Forex Indicator Explained

The Forex trendline is a single line, which outlines one directional price move from one point to another. When the price is following a trendline, this means it is changing its price following a general direction.

Understanding the concept of trends is integral in your ability to make money from the Forex portfolio management. Forex traders attempt to catch trend in order to buy when price is low and to sell when it is high, or the opposite. For this reason, the trendline Forex indicator is one of the crucial tools for boosting your Forex success rate.

Below you will see an example of a trendline Forex instrument:

trendline forex indicator explained

This is a 5-munte chart of the EUR/USD. The blue line indicates a Forex trendline indicator, which measures a price increase. The black arrows point the moments when the price tests the trend as a support (from below). Every time the price meets the trendline indicator we see an increase in the Forex rate.

We see 11 increases after interaction with the trendline. If you buy the EUR/USD Forex pair in every one of these moments, you will be able to sell on a higher price later. This is how the trendline Forex traders manage to generate profit from currency trends.

How to Draw Trendline in Forex

How draw to trendline in Forex depends on the points you have on the trading chart. Simply take a ray from your Forex trading platform, click on the first edge you see on the chart and then stretch it through the others.

how to draw trendline in forex

Every two bottoms could be connected with a single line. However, if three bottoms could be connected with a single line, then you have a bullish trend (inclined upwards). So you need three bottoms lying on the same line in order to confirm and draw a trend line. The first two bottoms just hint that the trend might be occurring on the chart. If the price creates another bottom on the same line, then you confirm the presence of a real bullish trendline Forex indicator.

Types of Forex Trendline Indicator

There are two types of trendline Forex indicator depending on the direction of the price.

Bullish Trendline Indicator

If the Forex tendency on the chart is bullish, you should use a bullish trendline indicator. You should take the first bottom on the chart, and then you should stretch the line through the other bottoms. The bullish trendline indicator should contain the zones around each of the bigger bottoms.

The two images above are example of bullish trends. If the Forex rate accounts for higher tops and higher bottoms you are looking at a bullish trend.

Bearish Trendline Indicator

If the Forex tendency on the chart is bearish, then you should use a bearish trendline indicator. Take the first top on the chart and stretch the trendline Forex indicator through the other tops. The bearish trendline Forex indicator should contain the zones around each of the bigger tops.

bearish trendline indicator

This is a real example of a bearish trendline indicator. The chart covered is 5-minute of the EUR/USD Forex pair. As you see, the EUR/USD Forex rate on the image above creates lower tops and lower bottoms.

How to Trade Forex Trendline Indicator

The key to making profits from Forex trendline indicator is to find a pre-existing trend and place a trade in the same direction. If the Forex rate has been moving lower for a significant amount of time the odds of it continuing to move lower in the near future are high. Opposite is applicable as well. If the Forex rate has been increasing recently, then the chances that the price will keep increasing are high.

Predicting when a trend is going to begin is one of the main challenges of Forex trading. The earlier you ride a trend the more money you are likely to make.

Due to this, people have devised complex methods to take advantage of trends. When trends are beginning, some use indicators and others use economics in order to support their trading decisions.

It is far easier to jump into a pre existing trend than it is to try and figure out when a new trend may begin. Trying to find the beginning of a trend may lose you a lot of money.

By jumping into a trend after it has already begun your sacrificing a little bit of potential profit for a higher probability trade. Opposite to this, by jumping into potential trend, you increase the potential profit of the trade for a lower probability trade.

Forex Trendline Trading Example

Now that you know how to draw trendline in Forex and how to trade Forex trendline, we will switch to a real Forex trend example.

forex trendline trading example

This is the 5-minute chart of the EUR/USD for Sep 8-9, 2016. The three points on the chart should be used to build the bullish trendline indicator. You should stretch the trendline through the three bottoms. Then you should buy the EUR/USD in the moment when the price bounces from the trend line.

Always use a Stop Loss order when you trade Forex trendlines. You should put it below the bottom created in the moment of the third bounce as shown on the image. Then if the Forex rate goes against you, the trade will be protected. Conversely, if you trade a bullish trend, the stop should be above the top you use to open your short trade.

The price increases afterwards. There are four bullish impulses created after the creation of the third top. Every one of these three impulses brings profit to your long trade.

In the red circle you see the moment when the EUR/USD Forex rate breaks the bullish trendline. This is a signal that the bulls are exhausted and the trend is probably finished. Therefore, you should close your long trade in the moment of the trendline breakout. The price difference between the third bounce and the breakout is your profit.

Conclusion

  1. The Forex trendline is an indicator which outlines the price direction of a Forex pair.
  2. Understanding the concept of the Forex trendlines will definitely improve your Forex trading routine.
    • If you enter early into a trend you have the potential to make more money, but this is riskier.
    • If you ride an already existing trend it is safer, but you will make less money.
  3. There are two types of Forex trendlines depending on the currency rate direction.
    • Bullish Forex trendline – takes into consideration the bottoms of the Forex pair
    • Bearish Forex trendline – takes into consideration the tops of the Forex pair
  4. You should use a ray to draw a valid Forex trendline indicator:
    • Bullish Forex trendline – Take the fist bottom and stretch a ray through the other bottoms. The trendline will be inclined upwards.
    • Bearish Forex trendline – Take the first top and stretch a ray through the other tops. The trendline should be inclined downwards.
  5.  You should remember two things trade profitably the Forex trendline:
    • Buy low, sell high.
    • Sell high, buy low.

Author: Christopher Webb
ForexMentorOnline


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Investing in Currency: How to be a Successful Trader

You may have heard that many clever and wise investors make money by investing in currency. Yes, many who know this secret take a chance to make huge sums of money on a day to day basis. But do you know how to be a successful trader? You can turn into a successful trader by investing in currency exchange, either part time or full time. Instead of waiting for a white collar job that is hard to come, you can invest your time and effort into foreign currency investment. This article will reveal secrets of how to invest in foreign currency with success.

Investing in Currency Exchange

Investing in Currency Exchange

If you know your way, investing in currency could turn you into a millionaire working from home. The concept of currency investment emerged due to harsh economic situations which forced a lot of people to start looking for ways to diversify earnings. There are definitely many businesses you can invest in but investing rightly is the number one key to success.

One investment prospect that has become very popular and highly profitable as people search for ways of becoming financial stable and save enough for retirement is investing in foreign currency. The Forex Market gives the chance to make gain through changes in the Forex rate of one currency over another.

Currency Education and Training

how to be a successful trader

A clever way to be a successful currency trader is to get Forex education and training. The reward of getting trained before finally delving into the real world of currency market is enormous. There are many free resources out there to assist you in becoming a currency trader in no distance time. Good Forex brokers offer training through their innovative Forex trading platforms. This way they help traders discover the rudiments of trading in the currency market.

The training you obtain will arm you with helpful resources for making money investing in currency exchange. For this reason, training is the key of how to be a successful trader. It doesn’t have to be paid training. The internet is full of of useful currency resources that you can access free.

If you want more confidence before investing real money in currency, there is no harm in registering for a formal training. It will only boost your knowledge and confidence when you place orders. You will then trade not like a novice but as a top currency trader who is already aware of the markets.

Training is the secret to achieving something in any type of financial market. This is even more applicable in the currency investment market. Many expert and successful currency traders you hear of today succeeded due to the Forex training they obtained. Without currency trading lessons, you are more likely going to lose your currency investment. Then your hope of becoming more financially stable before retirement will be foiled.

Currency Software and Autotrading

Currency Software and Autotrading

Online currency trading is speedily and rapidly growing. The increasing use of the internet brings right minds extra revenue. It is also turning into a major system of teaching various interested individuals in global currency trade dynamics.

Another excellent approach of becoming a successful trader is through the use of automated trading software. You need to learn the functionality of the profit-making computer programs before applying them to your trade.

What are Automated Forex Systems

Automated Forex trading programs are robotic systems that carry out Forex trade transactions for the currency traders. These systems take care of your need to do extensive and complex computations. They take care of actual buying and selling for the trader. The most significant thing about these programs is that they only need little involvement from the trader. However for them to function appropriately you would need to do some tweaking and customization.

Studying the different potentials of this profit automated systems is crucial to making winning trades. Therefore, you should try out different automated trading systems to weigh which one is more suitable. As a currency trader, you need to know the way the software functions and its prospective returns.

Benefits of Automated Forex Systems

An automated trading program is beneficial in a lot of ways if the Forex rate trader applies it correctly. The first benefit of using the system is that it will minimize or totally eliminate human emotions. Humans, sometimes, could dread and show signs of disbelief when confronted with certain situation that requires strong decision making process. During foreign currency investment, such feelings may bring the trader to make costly mistakes.

Any expert and workable automated program must be able to accomplish different trading activities on constant basis. It is essential that a currency trader keeps detailed records of various money-making opportunities. The use of an automated Forex program allows for smooth trading procedures. You are, thus, free from unnecessary difficulties and face ups.

The availability of these automated programs on the internet means that anybody from any part of the world can reach it. When you make use of these systems, you don’t need to pay for commission nor for an agent in order to trade. A significant advantage of the trading software is that you are able to keep all proceeds to yourself. The only cost for running your business may be the bidding and clearance costs.

Anybody that has basic computing knowledge can make use of these foreign exchange automated programs to carryout complex Forex trading deals on the internet. The programs come with user-friendly instructions which functions flawlessly if tracked with precision. With the program, there is also no stress of administration apart from ensuring that you do recurrent routine checks to prevent any possible break-down. However, to ensure that you are not victim of Forex scam you need to search for reliable Forex trading software from trustworthy and successful Forex traders or brokers.

Conclusion

Making money from currency investing all boils down to the training you have, the online Forex trading software or the trading Forex platforms you use and your Forex strategies. You can definitely become one of the most successful currency traders if you know how to manage the risk involved. Give it a try today!

Author: Bsmart Mills
Website: Alpari


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European Inflation Surpasses Expectations

The Eurozone inflation was announced at 0.20% on expectations of 0.1%. The previous value of the European inflation is at 0.10% which signals for an increase of 0.10.

This is more than two years since the Consumer Price Inflation in Europe stays below 1.00%.

The Euro did not react much to this announcement versus the other majors.

Current exchange rates

EUR/USD : 1.0924
EUR/GBP: 0.7281
EUR/JPY: 133.33
EUR/CHF: 1.0807
EUR/AUD: 1.5199

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US Core CPI for November matches the expectations

The United States Core Consumer Price Index for November (MoM) was just announced at 0.2% which matches the overall expectations. The previous value of the US Core CPI is also 0.2%, which means the index stays unchanged.

The Dollar recorded a slight increase versus the Euro reaching 1.0982.  At the same time, the H4 chart of the EUR/USD  shows that the price attempts to break a rising wedge formation. If this happens, we might see a new decrease of the price until at least 1.0839.

EURUSD attempts to break a falling wedge

Is this the end of the recent Euro run?

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