How to Choose Foreign Currency Trading Software

There is a wide choice of foreign currency trading software for the forex market. When you are just getting started with forex trading you will need to shop around to find the platform that will suit you best. But what types of program are available and what features should you look for?

Online brokerage accounts are always run through forex software. Your broker may either give you access to a platform that runs on their server or you may have something that runs on your own computer.

Brokers may have their own custom forex trading platform or they may use a generic platform which they can have tailored to their company.

This should provide you with many features including a wide variety of charts, tools and analytical capabilities that can indicate changing patterns and trends in the price movements. There may also be a forex alert feature or a running commentary on the financial news.

In some cases you can customize your desktop view of the software. This is more useful than you may realize at first. It can save a lot of time to have your preferred settings or combination of tools and charts load automatically when you log in.

If you choose to use automated foreign currency trading software, otherwise known as a forex robot, this will need to connect to your brokerage account to make the trades. See my review of Megadroid on this blog.

If you are running a program yourself, be aware that this usually means that your computer must be switched on and connected to the internet at all times while you have open trades, stop losses or orders to open a trade at a certain point. If your internet connection is often broken by storms or other factors, or if your internet provider automatically cuts the connection any time there is no activity from your machine for more than a certain time, you will not be able to trade effectively unless your instructions have already been passed to your brokerage account and are stored there.

The software should be simple to access and use. Clear instructions plus an FAQ page or manual that you can go to for reference are essential. Beyond that there should be some kind of support, either live or by email, when you need more detailed help or cannot find the answer to your question in the documentation.

Forex trading is risky and you can make losses as well as gains. In this very fast moving market it is vital to have all of the information that you need at your fingertips, plus the power to make your selected trades fast. Automated foreign currency trading software can help you massively and you need the best that you can get your hands on.

Product Review - Forex Trading Made E-Z

Forex Trading Made E-Z comprises an e-book and 12 videos and is a step by step guide to a successful but unusual system of trading on the foreign exchange currency markets developed by a retired American airline pilot named George C Smith.

This is an electronic product which can be downloaded immediately after you have placed your order securely online with Clickbank. Access to the videos is via links strategically placed within the e-book. I say strategically placed, because the e-book explains in detail the step by step system used by George and each step is supplemented by a video tutorial making it very easy to understand. In addition, you will have access to over 40 further videos of live trading sessions to help you further understand the process.

The e-book at 84 pages may sound a little overwhelming but most of it is taken up with the charts essential to George's system. He describes the success of his system as similar to the 'flight plan' needed to fly an airplane from point A to point B. Once you've learned how to follow the flight plan, it still takes a disciplined approach to make it work. That's why pilots follow check lists -- so they don't forget anything!

The combination of e-book and video is a great way to learn this system. You not only learn from the e-book which describes each step in detail, the video also shows you the live action - as though you were standing over George's shoulder while he does it.

This is not a get rich overnight system. It aims to increase the size of your trading bank by 5% each day of trading. That may not sound very exciting but when you consider the cumulative effect on even a modest bank of say $500, George shows how an average gain of 5% per day will double the size of the bank to $1,000 in just 14 days. He then goes on to show you how you can earn that extra $500 per day on average once you have mastered his system. Don't let me mislead you here, I say on average, because you will not hit the sweet spot every day - there will be days when your trade will lose which helps to maintain a healthy attitude to the real risks which without George's steady and disciplined system would surely take you down a typical gamblers losing path.

This system is not just for beginners, although the more experienced traders may skip through the early stages, there is something in the unusual nature of this system which even experienced traders can gain significant advantage from.

One of the things I particularly like about this product is that it concentrates on explaining how a complete beginner can make money at forex trading in the shortest and simplest way without all the hype and fluff I have seen in more expensive products of this type on the market. It doesn't attempt to explain the detail and complexity of the foreign exchange markets and the pros and cons of trading in different currency pairs. There is a link in the introductory section which takes you to a free e-book you can download if you want to know about that stuff.

A word of warning. This product is not a magic wand. You have the right mindset to be keen to learn and understand charts, patterns, trends and monetary statistics. If you are a complete beginner then you must follow the e-book and video tutorials and learn each step from the beginning and not become frustrated and jump the gun and try to trade too soon. You could do all this over a dedicated weekend and be ready to start trading when the markets open on Sunday night. My advise would be to paper trade for a while using a demo trading account before using real money just to make sure you are applying all the techniques of the system correctly.

Finally, there is support from George personally if you run into problems along the way and be sure to sign up to the notifications update list when prompted during the ordering process to have access to support and to receive updates with new ideas, explanations and even links to new videos as they are issued from time to time.

In summary, a great product and the combination of e-book and videos makes this an ideal way for a beginner to get started in a complex trading market. Also presents some unusual and interesting ideas for the more experienced trader.

Highly recommended. Click Here!

Forex Trading Training: How and Where

To become a successful currency trader, then no matter what background you have, you will need forex trading training. Currency trading has its own rules and even if you have experience of day trading on the stock exchange there are a few things you will have to learn.

So how do you go about finding training that is right for you?

One factor that you will want to take into account is the cost of your training. There is a huge range here from free information available on the internet to private mentoring from a successful trader that could cost you a thousand dollars a month or more.

Clearly, mentoring will only be of value to you if you intend to trade full time. Private coaching is most useful for people already profiting from forex trading but wanting to make more. Those people are also likely to be in a position where they can judge which coach or mentor will be most suitable for their own trading style. If you are just starting out, you would be better off covering the basics in some other way.

A good way to do this is to use a book or ebook. These are usually organized in a way that will be easy to follow and will cover the basics for beginners. Most will also cover more advanced aspects as you progress.

Ebooks have several advantages over printed books. First, you can download them right away. You do not have to go to the store or wait for them to arrive from Amazon. Second, as well as the forex book itself, they often include other training materials such as spreadsheets, audio recordings or even video.

Many people learn better from video than from the written word. When you are learning a new technique it can be very powerful to be able to look over somebody's shoulder and watch while they show you how they do it. Video can offer you this experience and save you a lot of confusion.

Also, if you buy a forex ebook you will often find that you can get some kind of support. You may be able to email the author with your questions, or there might be a forum that you can join. You almost never get this from a printed book.

It is true that there is a lot of information available for free on foreign exchange websites and you can also pick up tips and tricks from free forex forums. However, the information you will get from free sites and forums is usually very disorganized and may be contradictory. You can see this very quickly if you look at the questions on any forum. One person comes along with one answer, and then another argues something different.

So free information is useful while you are deciding whether to get involved in forex trading at all. But once you have made up your mind, you will want some more helpful forex trading training. So bookmark this blog and I will help you find your way.

The FX Market: What is It?

The forex or FX market is the currency trading market where foreign currencies are exchanged. It is not located in just one place. By its very nature it is a global market and trading happens all over the world.

In a sense there is a separate market for each currency pair. Every possible combination of currencies has its own price. Although these are related in some ways there is not necessarily a direct connection between them. Obviously if a country is doing very badly in economic terms,
then its currency is likely to fall in comparison with most other countries. But another country might be doing even worse and then the opposite would show on that particular currency pair market. For example the dollar could be falling against the euro while at the same time it is rising against the yen.

The biggest participants in the FX market are banks and other large financial institutions who have a lot of money to invest. They employ professional currency traders who do this for their job. But the markets are so huge and access is so easy that anybody can get involved these days.

All you need is a computer with a high speed internet connection. Do not try trading over a dial up connection! You will find it very frustrating. Prices will change too fast for you to act and you will probably lose money.

You will also need access to a broker who will cover your trades by offering you leverage. This means that with say $100 of your funds you can control $10,000. The broker handles this amount, but you can get started with just a few hundred dollars in a mini FX trading account.

The forex market is highly liquid and very volatile. Liquidity is a measure of how easy it is to turn an investment to cash. Currency is already cash so it has high liquidity. What this means for you is that you can buy and sell at any time. You do not have to wait to find a buyer as you often do with stocks.

The high volatility of the forex market means that prices are constantly changing. This makes it a very risky investment but also potentially very profitable. The possibility of gaining or losing a lot of money in a short time is very attractive for people who are prepared to take the risks. Forex trading is exciting and can be very lucrative for the skilful trader.

Traders use charts and graphs to indicate trends in the movement of the prices. The aim of course is to predict whether the price will continue to move in its current direction or when there will be a reversal. These charts and graphs are normally provided by your broker.

At the same time it is important to stay alert to world events that might affect the financial markets. Many brokers also provide a live feed of forex news. This can be very useful if only to remind you to leave the FX market by closing your trades before major financial announcements are expected.

FX Trading Platform: Finding The Best

Finding the best FX trading platform can be a challenge for both brokers and traders. Brokers will want software that is reliable, adaptable to their needs and easy for their clients to use. Traders are also looking for ease of use with good technical information.

Forex Platforms For Brokers

Many forex brokers, especially the larger organizations, will have a trading platform custom built for them. This is big business and a brokerage company will usually sneak a look at all of the platforms that competitors are using and then try to build something better. The cost of this is sure to be high. It can take a long time too. Software development, like construction, is something that always seems to take longer than expected.

Smaller brokers cannot usually afford to have all of the software designed for them from scratch. Instead, they may buy an FX trading platform that they can use out of the box. However, experienced traders will recognize this and may avoid such brokers. It is hard for traders to have confidence in a company that does not appear to be investing any resources in its trading software.

A compromise that works well for many brokers is to take a pre designed package and then have somebody customize it for you. The look of the program can be altered to include your logo, company colors and other factors. Better still, you could add more charts and offer any the technical analysis that traders are looking for but cannot get elsewhere. This way you can give the appearance of offering a unique trading platform without the cost of full scale software development.

Forex Platforms For Traders

Individual traders will generally use whatever software their broker provides. The platform is an important consideration when looking for a broker. For some traders, it is more important than cost. They may accept a bigger spread for the sake of the exact charts or information that they need to operate a system that they know is profitable.

In addition, traders who use automated systems or robots to trade the foreign exchange market will need a software platform on which their robot can operate. Experienced traders who have developed a profitable system of their own sometimes design a robot to automate their system for their own use. Most of the popular robots or expert advisors run on the Metatrader 4 platform. You need to download this for free in order to use most of the forex robots that you can buy today.

Automated trading software has many advantages, including the ability to automatically open and close trades when the market favors your system. Many forex traders are now moving into the world of robots and Metatrader 4 is probably the best FX trading platform for those traders.

Which Type of Forex Market Analysis is Best?

Within the forex trading environment, there are basically two types of analysis used to anticipate what is going to happen to currency movements. These are known as fundamental analysis and technical analysis.

Fundamental Analysis

What are the fundamental factors influencing the movement in currency prices? Of course we have to start with the world economy as a whole and the local national economies of the nations involved when we are looking at a specific pair of currencies. Generally, a healthy economy will point to a strong currency and vice versa.

Each time there is a financial report or statement issued concerning the state of a nation such as Gross Domestic Product, statements of the national debt, inflation, employment levels and trade deficits etc, there is a movement in currency values. By analysing historical data it's possible to predict what might happen when such a report or statement is due.

It's not only the economy that can cause fluctuations in currency values. Social and political events can have a strong influence particularly events such as an election, social unrest, terrorist attack or a natural disaster. Again it is possible to predict the effect of such events based on historical data.

Technical Analysis

This method is based entirely around charts to identify trends and patterns in currency movements. There are literally hundreds of technical analysis indicators available to traders and it takes a lot of time and practice to work successfully with this method.


As you would expect there are two schools of thought as to which is the best method and many forex traders will rely on one or the other. However, my advice is that neither method is mutually exclusive. It can be argued that fundamental analysis is based on emotion and technical analysis on logic. Well, like all things in life, the reality is a combination of both.

Fundamental analysis will help to identify large movements in currency prices but technical analysis is better at identifying small fluctuations which cannot be attributed to any significant economic announcement, social or political event.

So my advice is to work with technical analysis for identifying trends and patterns in the short term but also use fundamental analysis to keep and eye on the bigger picture. Forex market analysis using both methods is the way to achieve the best levels of consistent success with forex trading.

Candlestick Charts used in Forex Trading

Among the many types of technical analysis available to forex traders, the single most useful and popular are probably candlestick charts. These were originally developed in Japan during the 18th century by a prominent commodity trader who used them to chart the fluctuations in the price of rice. For this reason they are often known as Japanese candlestick charts, and many of the patterns that they form have Japanese names.

Simple line graphs plotting the price of a commodity at regular intervals in time had been used for centuries, but traders were in need of something that could plot more variables within a two dimensional graph. The bar chart showing the opening, high, low and closing prices of a commodity was useful and helped traders to predict future price movements in a more reliable way than line charts, but candlestick charts were even better.

They were introduced to the American stock market and from there to the worldwide financial markets by Charles Dow at the beginning of the 20th century. Dow was the founder of the Wall Street Journal and co-founder of the Dow Jones company.

Candlestick Formation

The chart is made up of a series of 'candlesticks' which typically have a chunky body with vertical lines stretching up from the top (the upper shadow or wick) and bottom (the lower shadow or wick). The different points measure the differential in prices over a certain period of time, which might be 5 minutes, 15 minutes or longer.

The top of the wick is the highest point reached during the time period and the lowest point of the lower wick is the low. The top and bottom of the body are the opening and closing prices. If price rose during the period the body will be white (or green or blue if colored). The bottom of the body marks the opening price and its top marks the close. If the price fell during the period the prices are the other way around and to show this at a glance the body will be black (or red if colored).

How To Use Candlestick Charts In Forex Trading

A chart showing 5 or 15 minute candles over a period of several hours can provide the forex trader with many patterns on which he can base a system for determining when a trend is developing. For example, when the candle body is white or green and higher than the preceding candles, it indicates that buyers are very bullish. When it is black or red and lower than the preceding candles, it indicates that buyers are very bearish.

Being able to see these implications at a glance is vital in the fast moving forex markets where trading decisions often need to be made in a split second. So candlestick charts are one of the most useful visual aids for any forex trader.

Foreign Exchange Brokers: How to Choose

Foreign exchange brokers are in abundance around the world with new brokers entering the market every day. So how do you set about choosing a good forex broker?

Firstly, look at the way they advertise. What are they saying to you? Of course they will want to attract your custom by telling you about the benefits of forex trading and the possibility of making lots of money. However, they should also be realistic and tell you about the risks. Many traders entering the market for the first time are blind to the risks and 'dive in' too soon.

Look for a broker who clearly states the risks and in doing so gives you some automated protection in your account, particularly the closing of trades when the funds in your account are in danger of being insufficient to cover a losing trade. This is particularly important for beginners who may not spot a potentially bad trade until it's too late. Be aware of the leverage offered. In the Forex market we see the highest leverage ratios being applied. Typically 50:1, 100:1 or even 200:1. At the lower end, 50:1 or 100:1 is normally provided for a standard trade of 100,000 units of a given currency. For smaller trades of $50,000 or less 200:1 is the norm. So make sure you understand how to apply stop losses and make sure your broker will hold your hand on this and apply stop losses automatically until you acquire the necessary trading knowledge and skills.

Look for a broker who has been around for a while and can demonstrate a good track record. We wary of customer testimonials on their website. You have no way of knowing if they are genuine. Look for credentials such as membership of a regulatory body. Are they supported by a reputable parent company?

Look for a broker who will offer you a complete service from tutorials, demo or paper trading accounts for beginners and full chart and technical analysis support with a variety of 'off the shelf' trading systems for you to try and bespoke systems you can develop for yourself as you become more proficient.

Look for a broker offering reliability and backup servers. You need to be sure that you’re in control of your trades 24/7. Does the broker provide a customer forum on their site? This is a good sign and gives you the opportunity to visit the forum and research problems that existing customers may have experienced. If they don't have their own forum, visit one or two of the popular forex public forums and don't be afraid to ask questions.

Finally, look at the spread being officered by the foreign exchange brokers. This is how they make their money. Is the spread on offer consistent with all forex pairs?

Forex Mini Trading Account

Forex mini accounts are ideal for just about anybody who is starting out in forex trading. You would have to be very rich or very confident to start right out with a standard account if you are a retail trader (i.e. somebody trading on their own account from home). A mini account lets you get started without risking so much money and this makes it a very attractive option for most people.

Mini forex trading accounts generally allow you to trade with just one tenth of the normal lot size. This usually means 10,000 units of currency instead of 100,000.

Of course you do not have to have this much in your account. Currency trading works with leverage. If you are using 100 times leverage then you need $100 to control $10,000 in your mini account or $1,000 to control $100,000 for a standard account.

$100 or 100 units of other currency per trade is enough for most people to commit to a trade when they are starting out and that is why the mini trading account is so attractive.

The pip size is also usually smaller in a mini account. Pips are units in which you will measure your profits, losses and costs (the spread).

Their dollar value can vary depending on the currency pair that you are trading, the lot size and other conventions of your broker, but a common standard pip size is $10 and mini pip size is $1.

Some brokers are now quoting prices to 5 decimal places which technically would make one pip 0.00001 of the quoted price, but we will continue to use the standard 4 decimal place pip for this example.

So if you have a standard forex account you can expect to put up $1,000 on each trade, be involved in trading lots of $100,000 and measure your profits in $10 units.

If you have a forex mini account you can expect to commit $100 on each trade, be involved in trading lots of $10,000 and measure your profits in $1 units.

Of course you can set stop losses so that you do not have to risk all of the money that is committed to the trade. But your losses will be measured in terms of pips so these too will be 10 times greater in the standard account.

If you are successful and your fund grows, you may want to move up to trading greater sums. You can still do this in your mini account by trading more than one lot at a time. So if you want to trade a standard lot size you would just trade 10 mini lots. This has the advantage of still giving you the ability for fine control of your stops because your pip size is still just $1.

The standard account used to be all that was available before so many people had powerful home computers and high speed internet connections that made it possible for the ordinary person to trade from home. The forex mini account is a development that has opened up the market to people who have the technology but not the money for standard currency trading investment.

If you want to risk even less of your money, you could look at forex micro accounts which allow you to make even smaller trades. Be aware though that the spread is often a little high and you might find it difficult to profit with a micro account. It may be better to use a demo account until your confidence builds and then open a forex mini account for real trading.

Forex Trends Is The Way To Make Money In The Currency Markets

The way to make money with forex trading is by observing patterns and trends in the currency movements and then acting when a trend is about to form in a positive direction. When I say positive direction, this can be an upward trend when opening a trade or a downward trend when closing a trade.

Charts are used for this type of technical analysis. There are generally three types of chart used for this - line, bar and candlestick charts but the most common is the candlestick chart because most traders find them easier to read.

In a candlestick chart, a vertical column shows the high and low price whose width represents the opening and closing prices. The columns are traditionally coloured white for rising and black for falling prices but colours such as green for rising and red for falling are now becoming more common. This type of chart is preferred by many traders because it is easier to see the turning points where a price has reversed from an upward trend to a downward trend and visa versa.

Being able to identify a trend before it actually happens is the big secret and this is where skill and experience is so important. Some traders will observe a currency movement between two imaginary horizontal lines on a candlestick chart and any movement up or down between these lines is considered to be a sideways trend and any movement beyond these lines is considered an upward or downward trend and will consequently trigger an opening or closing trade.

Sometimes these lines are referred to as resistance lines because the currency price will usually fluctuate between them or 'bounce' off them as though they were a physical barrier. Of course they are imaginary and the positioning of these lines is the secret to success.

It is important to take your time and practice with paper trades until you are confident with your interpretation of currency movements and emerging trends before you start trading with real money. Forex is risky and even with the best systems there will always be losing trades. The secret is to ensure that there are more winning trades than losing trades.

Traditional traders prefer to work with charts and develop there own manual systems. It gives them a buzz to be able to read the market and spot a good time to open or close a trade. For others, it's more do with just making money and increasingly there are some very good automatic trading systems, often referred to as robots, entering the market. Of course you have to set the parameters which are similar to the imaginary lines I've just mentioned but having done that you just sit back and let the robot open and close trades automatically.

However, even with robots, you should always paper trade until you are confident in setting the parameters correctly. When you purchase the robot software to run on your computer, it will come with detailed instructions and the ability to demo trade. Visit my blog for regular reviews of the latest robots as they hit the market.
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Forex Pip Explained

When you start to look around forex websites online, you will soon see references to the forex pip. Your gains and losses will be measured in pips. Something else that is measured in pips is the spread, the difference between the bid and ask prices which is the main cost of forex trading and how the brokers make their money. So it is clearly very important to understand what is a forex pip.

The word is an acronym standing for percentage in point (or sometimes, price interest point). It is the smallest increment of changes in values. It allows us to measure a rise or fall in currency values in percentage terms instead of in dollars and cents.

Why do we need to talk in pips? The reason for this is simple. In the foreign exchange market there is no world currency in which to express values. The US dollar may be the most commonly traded currency but it is not involved in all trades. If you are trading cross rates, i.e. two other currencies such as EUR/GBP or any other combination that does not involve USD, it would not make any sense at all to express your gains and losses in terms of US dollars. Instead, we need something that is a small percentage of the value of whatever currencies we are dealing with.

This means that the monetary value of a pip varies according to the currency.

Most currencies are quoted to four decimal points. For example you might see the bid price for EUR/USD quoted at 1.3642 and ask price 1.3644. The difference (the spread) is 0.0002 or 2 pips. Here a pip is 0.01% of a lot.

So if the lot size was $100,000, one pip would be worth $10. For a lot size of $10,000, one pip would be $1.

That is the value of pips when the US dollar is the quote currency, i.e. XXX/USD. But when the quote currency is different, one pip is usually 10 units of that currency (e.g. 10 euros or 10 pounds). Or if your lot size is 10,000 units, one pip is 1 unit (1 euro or 1 pound).

The exception is the Japanese yen which has a much lower unit value than most currencies (you get a lot of yen to the dollar). Because of this, the yen is only quoted to the second decimal point. You might see a price USD/JPY 110.15. In this case one pip is 0.01 or 1% but in yen, not dollars. So the pip value is JPY 1000 which at that price would be worth US $11.015.

These differences can be confusing when you are just starting out. So it is better for beginners to trade consistently with just one currency pair.

If you are trading one pair regularly every day you will soon get used to how much a pip means in terms of your actual gains and losses in your account. You will know how much one pip is worth in dollars or in your own currency.

But when you are trading several different currency pairs, you have to deal with pips of different value. If you get confused, you could be taking greater risks than you planned or closing trades with less profit than you thought. It is much easier to deal with only one pair at first until you have a sound understanding of trading practices and forex pip values.

Currency Trading Tips

There is a lot of money to be made in foreign exchange trading. Here are 3 currency trading tips to help you maximize your profits.

1. Use weekly charts in addition to daily charts

Checking back over the week's price movements for your chosen currency pair will give you a better perspective on both short and long term trends in the market. It is easy to become blinkered in spot forex trading especially if your method concentrates on day trading. Weekly
charts allow you to take a step back.

Sometimes the new perspective that you gain in this way will help you see what went right or wrong with your trading and why. This can help you to refine your systems to make them more profitable. However, do not make changes in a good system every time something goes wrong. There is a need for balance here.

2. Don't over trade.

It is tempting to jump into the market and open a trade whenever you think you spot an opportunity, when really you should have held back. It is often true that the fewer trades you make, the more money you will make. This seems counterintuitive because we tend to think that we need to make a lot of trades to build up big profits. But opening a trade at the wrong moment leads to losses, so in fact the opposite is often true.

You need to be comfortable with risk in order to engage in forex trading. Most traders even enjoy the risk. So it can be difficult to hold back from something that looks like a big opportunity. Remember this is investment, not gambling. You must choose your trades carefully. Taking chances in the hope of making a big killing is likely to lead to your account balance taking a hammering.

If you have a profitable forex trading system that does not often offer the opportunity to trade so it is not making you much money, do not be tempted to widen the criteria so that it lets you trade more often. This will almost certainly turn your profitable system into an unprofitable one.

Instead there are two things you can do. First you can increase the amount of each trade. This increases your risk and is probably not a good idea unless you are very sure of your system. Second you can try to find a different system that is equally profitable that you can operate alongside the first. This is the better option for most people but make sure that you test your new system thoroughly before adopting it.

3. Be realistic.

When you are thinking about how much money you hope to make with currency trading, it is important to be realistic and accept that sometimes you will lose. You should only be trading with money that you can afford to lose and do not expect to double your money over and over in a short time.

Unfortunately many advertisements lead you to have very high expectations. You may see an ad that suggests you can double your money in 7 days, for example. This does not mean you are certain to double your money, and it definitely does not mean that you can do it every 7 days with no setbacks. Doubling your money in a short time is possible but doing it over and over without losses is not realistic. Expect to take at least one step back for every two steps forward and have reasonable targets by comparing with what you might make if you invested in stocks or bonds.

Before starting forex trading for real, be sure you are armed with sound strategies that you have tested for yourself. Weigh up all of your options and remember that you are entering a risky business. Keep these currency trading tips in mind and give yourself the best chance of succeeding as a forex trader.

The Best Forex Trading Times

So what are the best forex trading times? The forex market is open 24 hours a day during the business week, but this does not necessarily mean that all of those 24 hours are good for trading.

There is a lot more activity on the foreign exchange markets at certain times of day and generally speaking, the best times to trade are when the markets are busiest.

The two biggest trading floors for forex are London and the US markets. Although the UK does not use the euro, most euro countries are within one hour time difference from the UK, as is Switzerland. US time zones also include Canadian. So the London session and the US session between them cover most of the major currencies that are traded.

The London session starts at 8.00 UTC and finishes at 16.00 UTC. The currencies that are most active during this session are the euro (EUR), British pound (GBP) and US dollar (USD) which is involved in the majority of all trades.

The US session starts at 13.00 UTC (8.00 EST) and finishes at 22.00 UTC (17.00 EST). The most traded currencies during these times are USD, EUR, GBP, AUD (Australian dollar), JPY (Japanese yen) and CAD (Canadian dollar).

The peak trading time, as you might expect, is during the three hours when these two sessions overlap and the markets are open in both London and New York. This period runs from 13.00 to 16.00 UTC (8.00 to 11.00 EST).

If you like to let your orders run over several days it may not make so much difference to you to know the busiest times on the markets. But if you are involved in day trading forex where you might open and close a trade within a few minutes, you will find most opportunities coming up during the most active hours.

If you are involved in a cross rate, i.e. a currency pair that does not involve the US dollar, you may have another window of time when the financial centers in your two countries are open for business.

For example if you were trading AUD/JPY you might find that trading was good during what is called the Asian session. The Australian and Japanese business hours are pretty close and on a day when activity was expected you might find some profitable trades during the overlap.
However, generally speaking this is a slower session for just about all currencies.

So the best time for most forex traders is during that three hour window in the morning in the US and the afternoon in the UK and Europe, when the markets are open on both sides of the Atlantic. Trading can be frantic during those hours, there is maximum liquidity and the currencies move far and fast. A lot of the important financial news is released during this period too, especially toward the beginning. So these hours are the best forex trading times if you want to grab quick profits.

Electronic Currency Trading: The Basics

Electronic currency trading is simply a way of dealing in currency exchange online. You may have seen it described as foreign exchange, forex or fx trading. It is something that appeals to many people who are looking for a way to make money on the internet using their home computer.

Forex is a little like stock trading, although the market itself is very different. You have the same aim of buying something hoping the price will rise. But with forex you are always dealing with money so you can also make money from a falling price, by exchanging out of the falling currency into a steady or rising currency.

Imagine for example that you are trading on the currency pair EUR/USD. This is a common combination for beginners. The US dollar and euro are most traded currencies and there is a lot of information available to help you, so it is a good choice to start.

With this pair you can choose to either buy or sell euros. If you place a buy order, this is called 'going long'. You would do this if you think the euro will strengthen or rise in value (or the dollar will fall).

If you place a sell order, that is 'going short'. You would do this if you think the dollar will strengthen (or the euro will weaken).

Your aim is to make a profit by closing the trade when the price goes the way that you anticipated. Closing the trade would involve selling euros if you had gone long, or buying them if you had gone short.

Of course, there is a risk. The price could go the wrong way, and you could make a loss. So it is important to have good information and a profitable trading system.

You do not need a lot of money to get started with electronic currency trading. Many brokers will let you begin with a couple hundred dollars, although it is better if that is not all the money that you have in the world!

Forex trading involves margins. This means that you can place orders for a lot more money than you actually have. You do this through a broker who will guarantee the balance of the order. They know you will be closing the trade at some time and if one currency is falling, another is rising. Currency values are relative, so it is not possible for all currencies to crash in the way that all stocks can crash.

Currencies can be very volatile but you can use stop losses to ensure that you do not lose more than you are willing to risk. Some brokers operate limited risk accounts where they will automatically close your trade if you lose the balance of your account. This means you do not have the dreaded margin calls which can be so disastrous for stock traders.

What You Need To Know about Metatrader 4 Expert Advisor

The Metatrader 4 expert advisor range is the most popular range of forex autopilot software. There is a wide choice of expert advisors designed to run on this free downloadable platform or framework that sets a structure for EAs to be built on. Whichever expert advisor (EA) you choose will act as a robot on the forex market, trading for you according to the boundaries that you set.

Clearly this has many advantages over making all of the moves in a trade yourself. The EA does not need breaks for eating, sleeping and human contact. Neither does it suffer from human weaknesses such as fear and over optimism which can distract us from our systems and lead us to exit a trade too soon or not soon enough. Once you have set it up it will obey your system to the letter all the time that it is online.

An EA will often protect your interests when you could not do it yourself. The opportunity to set a trailing stop is one example. A trailing stop automatically moves up with rising prices but stays in place if the market falls. This means that on a successful trade it protects a part of your profits without exiting too soon. On an unsuccessful trade it protects you from heavy losses just as a standard stop would do.

Some of the functions of an expert advisor depend on having it constantly connected to the internet. This because MT4 and the EA run on your own computer or server, not on your broker's servers. For example if you have set a trailing stop, MT4 sends a message to your broker account to move the stop each time and it has to be connected to the internet to do that.

This means that to make the most of the potential of a Metatrader 4 expert advisor on a home computer you have to leave your computer online 24 hours Sunday night thru Friday unless you happen to have exited all of your trades before you stop work on any particular day.

Any break in the connection will mean that no more messages are sent to your brokerage so the trailing stop will be left where it was last set. It will still protect you from a large loss but it will not move up any more so you will have lost some of the advantage of having a system that works while you sleep.

However, some EAs can be hosted remotely. This means that you can set them up on an internet server instead of your own computer. This could be your own or a facility offered by the EA company. They may offer this option as an upgrade after you order their Metatrader 4 expert advisor.

Forex Trading Education: 5 Tips For Sticking to a System

One of the most important things you can learn in any forex trading education is how to stick to your chosen system or systems in a consistent way.

Changing from one thing to another will kill any chance you have of success, but we are all tempted from time to time. If you find it hard to stick to one trading system, here are some techniques that may help you to learn to be consistent.

1. Consider carefully before you decide to follow any system. One successful businessman has said that the secret of his success was thorough research before a decision, and then sticking to it like iron. You need to be sure that your system is profitable ... not necessarily the very best. And you need to be comfortable with all the actions that it will require you to take, whether things are going well or badly.

2. If you have problems with self discipline in other areas of your life, use those to train yourself in the skill before you start live trading. Do not pick the thing that you have most trouble with, but something that you could fairly easily master. It might be getting up at
the same time every day,

3. Allow yourself a small 'fun' budget or have a separate mini account for trades that look so tempting that you cannot pass them up even though they do not fit your criteria. You will almost certainly lose this money over a period of time, so be sure you can afford it. If not, avoid the temptation and track these trades on paper instead or use a demo account. Be sure to track them all because we have a tendency to remember the few that would have profited us and forget the majority that would have lost.

4. Do not discuss your trades or your system with anybody else. It is fine to ask around on forums before you have decided on your system, but do not be drawn into debate about the merits of a system after you start using it. You will quickly be swamped by negativity from people who want to believe that their own system is better. Equally, do not discuss it with non trading friends or family members. They will often be negative simply because they do not understand.

5. Do not drink alcohol while you are trading. In fact, it is better not to even look at the markets when you have had a few beers. If you see a tempting trade that breaks your normal rules it will be much harder to resist when you are under the influence of alcohol.
So even though we all love the idea of working from home in our pajamas with a beer at one elbow and the cookie jar at the other, reality is that relaxing to this extent does not combine with successful forex trading. A mind that is even slightly fuzzed by alcohol will not be able to keep to a consistent trading plan.

An automated forex robot can help you out here. You can set it up to trade automatically for you, if you are not yet able to act consistently while you pursue your forex trading education. This robot is highly recommended Click Here!

Trading Currencies: 7 Good Reasons Why Trading Currencies is an Attractive form of Investment.

With the advent of fast internet connection, trading currencies has become a very attractive form of investment. Otherwise known as foreign exchange or forex, it's a market where almost anyone can become involved. You need a computer with an internet connection, some money to invest and a little time at the beginning to learn the market, develop your own system or buy into one of many off the shelf systems.

The amount of money you need is not much. Many brokers are vying for your business and now offering mini or micro forex trading accounts requiring just a couple of hundred dollars to set up. Of course, there is a risk in forex trading as in any other form of investment, especially to start with as your learn the ropes, so you should stick to the old adage and not invest money you cannot afford to lose.

However, assuming you have the funds and you are keen to invest those funds to make money, then I will give you seven good reasons why you should choose trading currencies as opposed to trading in stocks, shares and commodity markets.

1) No fees or commissions.

Brokers make their money from the spread between the bid and buy price of a currency. So unlike the stock, shares and commodity markets, you do not pay fees and commissions which can absorb much of your profit.

2) Minimal start up costs.

All you need is a couple of hundred dollars to open a trading account, a computer with a high speed internet connection and you are away. You may decide to buy into some automated trading software which will set you back another $100 or so (example: Click Here!
).

3) Tools and information are free.

There is a lot of competition between brokers and consequently they are falling over themselves to win your custom. A good broker will offer tutorials and demonstration accounts where you can learn to paper trade without real money while you learn the basics. They will also provide you with free charts and show you how to use and interpret them. Otherwise, all the learning and information you need is freely available on the internet via specialised websites or blogs such as mine.

4) 24 hour trading.

Because the currency market is Global, it is effectively open 24 hours per day, 5 days per week. It opens in Sydney Australia at 22:00 UTC on Sunday evening and closes at 22:00 UTC on Friday afternoon in New York. This makes it very easy to do this part time while holding down a normal day job. Once you have leaned the ropes and become successful at trading currencies, you can give up the day job and become a full time forex trader.

5) Higher levels of Leverage

The leverage that is achievable in the forex market is one of the highest that investors can obtain. Usually, the amount of leverage provided is either 50:1, 100:1 or 200:1, depending on the broker and the size of the trade. This gives you the opportunity to make a lot of money by trading with more money than is available in your trading account. Be aware, this is not for the faint hearted - if your trade goes bad you will have to pay the money back. However, when you become more experienced and successful with your trades this high level of leverage makes this form of investment stand out from the 2:1 leverage commonly provided on equities and the 15:1 leverage provided by the futures market.

6) No fixed size of contract.

Standard trading is done on 100,000 units of currency. However, with spot trading you can, in theory, determine the size of contract you wish to trade. Some brokers do have set sizes for administrative purposes but if you shop around you will find a broker who will cater for your needs.

7) Liquidity and Volume.

The liquidity of an asset is the ease with which it can be turned into cash without loss of value or at least without any significant loss in value. Currency is money and money is cash and is therefore more liquid than any other asset making it very easy to trade. The volume or amount of money being traded in the forex market every day is around $4 trillion. The international banks and other financial institutions as big and as influential as they are have no chance of dominating the market. Trading currencies is also void of the risk of insider trading which can blight other forms of investment.