Hours with a pair of EUR / USD.

Real Source: http://euronis-free.com/Articles10.html

In this article I want to share their thoughts on the currency market Forex with a pair of euro / dollar. This is one of the most beloved and frequently traded currency pairs on the exchange, and I think you will be very interesting to learn some of the features of trade with it.

So, let's begin. Intensive movement in a pair euro / dollar, as a rule, begins from 9.00 am Moscow time. At night, the Americans and Europeans are asleep and the fluctuation is very minimal, Asian forex traders are working with other currencies such as Yen, the Yuan, the Australian dollar, etc. At 9 o'clock in Moscow emerging basic movement in a given currency pair. The main trend is given by Europeans in Berlin, Frankfurt and Paris. British come to trade a little bit later, around 11-12 hours. At 12.30 - 13.00 face important macroeconomic news in Europe, and they can seriously break the movement that emerged in the morning.

The main drivers of growth or decline serve data on unemployment in the EU, the level of industrial production, etc. At 15.30 on Thursday, a monthly published decision of the European Central Bank's interest rate. This, in my opinion, the central event of the European scale, which significantly affects the dynamics of the pair eur / usd.

From 16.00 on the currency market forex come the Americans, and trade activity increases significantly. This is a time when all the professional traders must monitor the auction in front of their monitors.

16.30 central time on Forex for a couple of euro / dollar, the U.S. published the important macroeconomic indicators. This currency pair can for five minutes, ten "striding" hundred or two hundred points up or down, especially this can be observed at the output of these pay rolls.

Also of note for a time 18.00, as well as major events occur in the forex in the United States. Apart stands the time of 22.15, when it becomes known to the decision of the Fed (U.S. central bank) about the changes in the discount rate. If you are a professional speculator - this is your finest hour for a good profit. Do not miss this event.

After 23.00 trade activity comes to naught. Fix profit, closed unprofitable positions.

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Using Pivot Points for Reversal Entries

Real Source: http://2ndskiesforex.com/articles/using-pivot-points-for-reversal-entries/

One of the most challenging aspects for traders is finding and entry point into the market, particularly when looking for reversals or rejections. However this is not as complicated as it seems for there is a tool which is exceptional at helping traders find intraday entries for reversals – Pivot Points.

What are Pivot Points?
Originally created by floor traders, Pivot Points were simply used to mark key support and resistance levels based upon the previous High, Low and Close for the last day of price action. These three metrics were combined, then divided by 3 and this formed the Daily Pivot. The DP (daily pivot) was used to determine if the overall pressure for the day would likely be more down or up. If price opened above the DP, buying was generally preferred and vice versa if it opened below.

From the DP several other pivots were formed which were Resistance or R pivots and Support or S pivots. Finally, after becoming so popular they created Mid-Pivots which were simply the halfway point between any two pivots. Below are the calculations for pivots which we use:

DP = (H + L + C) /3

s1 = DP – (H – DP);//S1
s2 = DP – (H – L); //S2
s3 = L – (H – L); //S3

r1 = DP + (DP – L); //R1
r2 = DP + (H – L); //R2
r3 = H + (H – L); //R3

S1 = Support 1 pivot
S2 = Support 2
S3 = Support 3
R1 = Resistance 1 pivot
R2 = Resistance 2
R3 = Resistance 3

The blue colored lines are the support pivots and the red colored ones are resistance pivots while the yellow are the mid-pivots. As the name suggests, support pivots are the intraday support levels for that day while the resistance pivots offer key resistance price levels to watch for that day. We set our pivots to the London open since the London traders are basing their charts off their open and with the majority of traders coming out of London, we feel these will be the most effective and consistently watched by the institutional market.

The Statistics
The bottom line is price action has a greater chance to respond to a pivot level for that day than any other indicator out there. Our quantitative research done over the last 10 years suggests every 1hr candle from the London open to NY close has a 70+% chance of touching a pivot. Meaning, if you are going to be in a trade for more than 1hr, chances are the price will touch, react or respond to a pivot.

Since the institutional traders move the market, they are likely placing orders here on an intraday basis more than anything else.

How to use them for Reversals and Rejections?
To use them for a rejection/reversal play, the first thing we need to do is find an existing trend or momentum play. If you read our article on Impulsive vs. Corrective moves in reading price action, you will be able to easily spot these.

EURCAD
We will start with the EURCAD which on the daily chart below we can see is clearly in a downtrend.

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Dollar-Cost Averaging

Real Source: http://2ndskiesforex.com/articles/dollar-cost-averaging/

I was recently reading some article on some very popular finance site whereby the person was talking about the stock market and today’s 376pt crash. They were saying how its not good for buy-and-hold investors, it is good if you are dollar-cost-averaging.

The funny thing about this is this term is totally misunderstood in context, history and is really used by rookies. You will never see a hedge-fund manager using this term, nor some ultra-high level investor. When have you ever heard Warren Buffet, George Soros, Mark Faber or any other high roller using this term? Never.

You know why? Cause its a joke.

The term was originally used in Chinese chop shops whereby they tried to goat people on to trading more when the prices were falling heavily. They would use the term ‘dollar-cost average’ trying to get you to buy again even though the price got hammered. Why would they do that? Because chop shops like theirs got paid in two ways;

1) by customers trading

2) by taking the other side of the trade

When the market crashes like they did today, people are totally afraid to buy and rightfully so. However, to keep the market busy, supported artificially with the dumb money, make more money off of trading, people use the term ‘dollar-cost-average’ like its some brilliant investment idea. Sure, there are some mathematics about it, but anyone can make those mathematics seem brilliant. Think of how well dollar-cost-averaging worked on Bear Stearns, Lehman Bros. or a host of other companies that failed in 2008 or the dot.com bust.

Its the most rookie, insane and ridiculous idea that after something fell huge, we should buy it again. Why? Because its cheaper? After a huge day of selling, unless its sitting at some major support, who will want to buy it?

Yeah, dollar-cost-averaging worked for Bank of America (BAC) when it dropped from the mid $40’s to about $4. Oh yeah, it worked again with Citigroup (C) which fell from the mid $20’s to about $3.

Bottom line is whenever you hear the term used by anyone, you know immediately they are just using what some guy before them has told them to say without any real understanding of the word, its history or significance. You know immediately they are a rookie and really do not have any clue as to whats going on in the market.

I know this has little use for Forex traders, but you likely are going to run into this word or some investment ‘professional’ who uses this so understanding what it really means and where it comes from will help you in the future steer clear of that person.

In fact, any student of price action witnessing a market where people are saying, ‘dollar-cost-averaging’ would be selling the market and making money why others are buying it and getting killed the next day.

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Forex Ichimoku Report July 28th

Real Source: http://2ndskiesforex.com/research/forex-ichimoku-report-july-28th/

EURUSD – Looking Like it Wants to
Since breaking the daily kumo for the first time in the last 8 mos and the entire year of 2010, the EURUSD has performed notably consistent with a kumo break play as it has pulled back to the flat top and since bounced from there.

It has however stalled around the 1.3000 barrier and after two major rejections off there with one of them sending the pair back to the flat top, the pair has been attacking it for a few days now without any major dips. In essence, its behaving like a pair that wants to break 1.3000 and has yet to show any signs of it not having the gusto to do so. Now would not be the time to add longs so you can either wait till a mild pullback to the kumo flat top or a weekly close above 1.3050.

USDJPY – Rejected Again
After making its most legitimate attack on the 20ema, the USDJPY has been rejected off the daily 20ema for a 6th time now. The pair has sold off but albeit mildly and considering how the price action looks to form a base around 86 yen, look for the pair to produce a higher low and strike back at the 20ema. A close above it will likely gun for the falling Kijun trend line but if that should be broken, then it seems like an attack on the kumo might be inline before the bulls mettle will be really challenged.

GBPUSD – Outperforming
Going further than most expectations off the 1.4300 lows, the pair has cruised at a saunterly pace past 1.5350 and 1.5500 which were major fib / resistance levels. The pair is eating its way past 1.5600 but has yet to have an aggressive attack on the upside suggesting liquidity is low at the moment.

With that being said, a dip back to the 20ema would be a solid play for another long as the tenkan’s momentum is strong and the kijuns path is climbing suggesting this pair will continue to walk up the slope for more ground. A little caution is noted though since the pair has climbed for 4 straight days and looks set for a 5th so perhaps waiting for a pullback day (albeit a mild one) would be more prudent.

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How I became a successful part time forex trader

Real Source: http://www.aboutcurrency.com/articles/fxknowledge/how_i_became_a_successful_part_time_forex_trader.shtml

Introduction

I am Joe Chalhoub, a computer engineer, Forex trader and strategy builder. I began trading currencies 3 years ago. The first 3 months trading were complete failure, I remember I lost all my money and I was about to quit, but I couldn’t, I felt if I quit now maybe I am missing the chance of having my own business. So I stopped trading and began observing, studying, analyzing and practicing.

Observing: I began observing the market, what causes movement, reaction, ranging and trading.

Analyzing: I began working with technical and fundamental analysis; how each analysis can predict and redirect the market and how I can use them both for my own benefit. I will talk about these analyses in the following paragraph.

Reading: I bought Forex Trading Books and read them, books explaining different strategies and tactics used by experienced traders.

Practicing: I created free accounts and began trading virtually and each technique I invent I tried it and monitored its performance and validity.

After one year of studies, analysis and practicing trading techniques and after many failure and frustration I reached my own strategy and it is working very well and each month my profit is positive.

Implementation

I reached my targets and I built a successful strategy, but that’s not enough; to make profit I must not miss any opportunity and forex market is full of opportunities because it is the most active market in the world, for that reason I must sit all time and watch and detect opportunities all day long from Monday to Friday.

How to resolve this problem, I can’t sit and observe the market hours and hours, I have my career and my family, so I thought I must program my strategy, let the Information Technology do the hard work for me, and nobody is discipline as a software, so I created an artificial intelligent software which collects data from the market and implement my strategy on this data and detect opportunities 24/24.

This program analyses fundamental and technical data and generates forex signals which are forwarded automatically to my broker platform where the signals are executed automatically and forwarded also to my website members. All this is done without my interfering, I just run the program, it analyses and makes its decisions (Buying, Selling or stay aside).

How to succeed in Forex Trading

Five over hundred traders succeed in this business, what differentiate those five successful from the 95 others is one thing, it is the HARD WORK. Forex trading is not an easy business, and who tells you that he can make you rich in one night is one of those 95. Only one thing can make you a successful trader, HARD WORK, and nothing else. Don’t rely on other traders or advisors to help you, rely and have confidence on yourself.

Don’t begin trading quickly, the forex market will not go anywhere, it will stay forever, give yourself 6 to 12 months of studies, analysis, readings, practice and build your own strategy before begin real trading, it will take a lot of time and dedication but at the end you will reach your target.

Strategy

I will not reveal my full strategy but I will reveal some techniques I use which help traders in their trades.

My strategy follows the following tips and techniques:

1 – Discipline: Put criteria for your trades, watch the market and only trade when criteria are met, if they are not met do not trade. My program is the most disciplined trader, it takes care of all of this, it monitors the market and only trade if only criteria are met, and the second advantage of this is the elimination of the fear factor, it enters a trade when it sees it is good to enter and fear nothing.

2 – Money management: It’s the main key for good trading, I exit all trades and stop trading for a specific day if I lost -60 pips, in the other hand I put stop loss for my trades if I reached +25 pips profit, in that case profit will not get under +25 pips and it has open target, and all I have to do is go out and have fun.

3 – No trades for now: The most important thing in trading is sometime not to trade, I take this decision after looking to my charts and see that there is not enough volatility or there is no enough reports will be released for today and it is better to wait until market is more volatile. I advise traders not to trade during the first days of the month, personally I begin trading at the first Friday of the month when the “NonFarm payroll” report will be released.

4 – Analysis: I use fundamental and technical analysis while trading. Fundamental defines the trend of the market and the technical analysis is used after the definition of the trend. I trade the news by analyzing programmatically the released data for a specific report and generate signals which are executed immediately on the trading platform and forwarded simultaneously to my members.

Fundamental and technical analysis must be used together, if one is used without the other this will lead to failure.

5 – Technical indicators: In the forex market there is a lot of indicators which are used by many traders. I use ADX, Bollinger Bands to identify trends and volatility; RSI to identify an over bought or sold and Moving Average to identify a signal. And the most important technique is FIBONACCI, I advise traders to implement this technique and use it to confirm trades.

Finally, I must say that Forex is not easy, and many times we feel that someone is doing a conspiracy on us to take our money, but the truth is nothing is impossible, and others successful traders are not more intelligent than us and they are not genius from other planet, the fact is the more you work the more you become closer to become good trader. Do not quit quickly because this business deserves hard work and dedication.

Joe Chalhoub

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What is Slippage in Forex?

Real Source: http://www.aboutcurrency.com/articles/fxknowledge/what_is_slippage_in_forex_trading.shtml

You bought the EUR/USD at 1.4000 and the market is now trading at 1.4025.

Since there is an economic release due out in 15 minutes, you move your protective stop up to 1.4000 to protect your winning trade from turning into a losing trade. The number is released and the market trades down through your stop level to as low as 1.3975 in a matter of seconds. But instead of getting filled at your price of 1.4000, you are filled at 1.3990 and now have a losing trade on your hands.

Why? The answer is that there was nobody willing to take the other side of the trade at your price. A trade is when two people agree on price but disagree on value. One thinks the value is too high and the market should move down while the other thinks the value is too low and the market should move up.

When a major economic number is released, the volume dries up as most big traders stand aside. They will not trade if they cannot identify their risk. So there is not as much volume as you would see in a normal market environment. However, there are still plenty of traders trying to take advantage of the volatility. They will all want to trade in the direction the market should take based on the number released.

So if everybody thinks that the market is going down, all these traders try to sell at the same time. The problem is that there are not many traders looking to buy if the market is falling quickly. So the market continues to fall until the buyers step in and start taking the other side of the trades. But they are buying at their price, not yours. In the example above, a sell stop order becomes a market order once the price designated is printed. So when the market traded down to your stop level of 1.4000, your order then became a market order.

When you are selling at the market you are matched up with somebody is buying. If they are only buying below your sell stop price, you will be filled at that level. This is called slippage and it is present in every market in the world. This brings us back to why many big traders do not trade in this environment. So if you are trading in a volatile market environment, you have to be prepared for slippage. It is the nature of the game.

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Brokers monitoring your pattern of trade

Real source: http://www.aboutcurrency.com/articles/fxknowledge/brokers_monitoring_your_patterns_of_trade.shtml
Do you have any idea as to how much your Broker knows about you and your trading habits? Your Broker will know a lot more about you and your trading habits than you may realize, especially if they run their own Dealing Desk rather than routing your order straight through to the Inter-bank. A Dealing Desk will be looking to match your Order with another client that is trading the same Pair, but in the opposite direction. That way the trade stays in-house, no Inter-bank commission is paid and your Order never leaves the Broker's door.

At a base level your Broker will not be reviewing each and every trade that comes through the door, but they will be monitoring their internal order flows to ensure that they are in-line with both the Interbank prices, and the next tier down, at the EBS (or Level II). The decision to route Orders to the market, or not, is Automated and mainly dependent on volume levels, but your pattern of trade will also add to that decision as your account balance grows.

There is nothing untoward about this business model, it is nothing new, after all it is what Dealing Desks are there for; they are replicating the Interbank and Level II for their internal uses, and by collating this kind of data are able to generate internal liquidity. So long as your fills are reliable it makes no difference where the Order goes, but knowing what is happening at the Broker's Desk may also help in understanding what actually happens on the occasions when your Order does not get filled.

Pattern of Trade. You create a pattern of trade each day that is easy to follow, and with the help of technology is something that is simple to track and report. If for example you regularly trade the same currency, you use the same Lot size, and you tend to hold the trades for set periods of time, your new Order can be reliably swapped with another that is going the opposite way. Once you have an account balance at a set level, and a set pattern of trade that can be followed, your Orders will not often leave your Broker's doors if they have an active Desk. Your trading footprint can be easily followed and monitored, and there are positives in what your Broker can do with data for you as well in providing liquidity.

Trading Bio. A trading Bio of your habits, your Trends, your Stop areas, your Take Profits, and even the length of time that you are in a trade is a great tool for a Broker to leverage in being able to set the criteria in deciding whether Orders go to the Market or not. If a Broker needs liquidity in a certain Pair, that may tip their hand in that decision as well. Technology and Automation are revealing more about each trader than most would realize, as the Broker works to get you filled at the prices that you see.

Slippage and Spikes. There is nothing underhand with a 'Broker Big Brother' (BBB), and nothing to worry about so long as your Broker does not have 'unusual' looking price spikes, holds off order fills , or creates slippage on a regular basis. Spikes, slippage and failed Orders are a reflection of one thing in general; the fact that there are no Interbank Orders on both sides of the quoted prices, there is no conspiracy in the Interbank to manipulate prices, it is just a time and a price point that for whatever reason does not contain Orders. Spikes will occur until a price point is reached that houses Orders, it is the natural flow of the Market.

If your Broker runs a Dealing Desk they will replicate the Interbank, and your trading habits will then form your Broker's Level II, or EBS, data. So as your account balance grows it may be something to be aware of when placing your trades; maybe by splitting your main account into a number of smaller accounts, and if you do not pay a commission per trade maybe look to split one big Order up into a series of smaller Tickets. That way a lack of liquidity will not impact your Order as much.

Big Brother? No doubt about that all. A Problem? Not really, not as long as we understand the natural flow of the Markets, but it is something that we need to be aware of, especially when placing larger trades.

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Is Finanzas Forex a Reputable Investment Firm?

Real Source: http://www.forexfraud.com/forex-articles/finazas-forex.html

Is Finanzas Forex a Reputable Investment Firm?

Many people these days seem to be wondering if Finanzas Forex is a reputable investment firm. Unfortunately for those who invested money in the firm, the answer appears to be a resounding “no” and the company demonstrates all of the classic hallmarks of a failed High Yield Investment Plan or HYIP Ponzi scheme.

Additional details about this potential forex scam appear in the following sections.

What is Finanzas Forex?

According to information contained on FAQ web page for Finanzas Forex, Finanzas Forex is the commercial name of Evolution Market Group Inc. which claims to be headquartered in Panama. Apparently, the firm was registered as an anonymous corporation with a Panama Registration number of 558703. This is one warning signal about the company since Panama does not regulate corporate activities like the United States does.

The FAQ goes on to say that Finanzas Forex is an online private investment firm specializing in the forex market. It also claims to facilitate people of limited resources to obtain access to investing in the forex market without a large investment and without any knowledge of financial markets.

Finanzas Forex Organizational Structure

Furthermore, although the Finanzas Forex FAQ page describes the organization of the company as being headed by a president, no name is given for that individual. Neither are names provided for the heads of the other departments listed on the website which includes the firm’s information, administration, marketing, legal, finance and account management sections.

Without publishing any names, the site nevertheless assures the visitor that the head of each department is a real professional in their respective areas. This makes it rather difficult to check up on the biographies and possible criminal records of any individuals involved.

The page goes on to explain that the company is not a bank or stock brokerage, but that their investments are outside of the stock market and that they invest solely in the Forex market – an unregulated market.

Minimum Deposit and Duration of Deposits

According to the FAQ, the minimum deposit for investors in Finanzas Forex is $100 USD, which is typically not credited to your account for two weeks or 10 business days after the initial deposit is made. After depositing the money, which can only be done through a bank transfer, the funds must be left in the account for a minimum of six months.

Commissions are charged by the bank depending on where the funds originated. Finanzas Forex assures potential customers that these fees can usually be recovered in the first month’s profits. The funds are then made available for a customer to invest in any one of a number of different investment options.

Nevertheless, when trying to find out what the investment options are that customers can choose from, the web page with the investment plans was blank. The page did say that the company was not accepting investments from the European Union, or from any country, depending on which language you read the website it.

Furthermore, the firm’s website also advised that those wishing to invest should do so through companies regulated by competent organizations. Perhaps this implies that they are not such an organization?

More Discrepancies

When pulling up the pages in English, the site specifies it does not “admit any investor from any world’s country” citing the Evolution Market Group Inc. was waiting for:

“The resolution that the USA authorities will release in order to return to its investors the deposited funds.”

In addition, the site reminds investors that Finanzas Forex:

“Has followed and continues to follow an anti-money laundering strict policy, for which it was implanted a compliance system.”

While the exact meaning is unclear due to the notably poor English, it might be trying to say that the company has a compliance system to avoid having people use it to launder money.

Conclusion – Very probably not.

Basically, the Finanzas Forex website is sorely lacking in any valid information about the people operating the company, its investment plans or whether they are willing to return funds to their original investors. This means that Finanzas Forex is highly unlikely to be a reputable investment firm.

Furthermore, many people on online forex discussion forums claim to have not had their funds returned and to have not received any word from the company for some time. Since Finanzas Forex does not seem to have addressed its investors since August of 2009, most people who trusted the company are now losing hope of recovering their investments. Apparently, several international lawsuits against the company are also pending.

Basically, the Finanzas Forex HYIP scheme seems to have gone the way of the dinosaur — extinct.

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Forex Robots

Real Source: http://www.forexfraud.com/forex-articles/forex-robots-trade-signal-software.html

What is a forex robot? This is a kind of program developed by some high-school educated individual, which purports to be able to eliminate the human factor from trading entirely. Since programs, API’s, do not respond emotionally to market developments, we’re told that they possess a clear advantage over the human trader who is constrained by his natural disposition to shout, weep, laugh at sharp turns in the market. In this era of automation, the proponents of automated trading propose that we are fools to draw charts manually and to analyze every twist and turn of the market with eyes glued to the screen, especially when the computer can be programmed to do all these in our place and to do so with an efficiency that is impossible to match for a human being. Since everyone emphasizes the importance of discipline during trading decisions, of the crucial role of solid rules which are followed with punctuality and consistency, the creators of these programs submit that there is no better choice than leaving all the practical aspects of this task to an automated program.

In order to establish the validity of their claims and to demonstrate the purported prowess of the robot, the sellers of these curiosities will couple their sales letters with a large record of back testing data that shows the irrefutable power of automated trading – in hindsight. Very large profits with little drawdown, consistent gains over many trades all convince inexperienced traders that the Holy Grail is within reach finally. If only it were possible that Percival and Lady Guinevere were here, how merry everyone would be! But we will have to contend ourselves with the tremendous profits we’ll make while utilizing our new robot, which we bought for about $500.

But will we really make those great profits or are we just helping to fill the stomach of the bard for the entertainment value? What does a forex robot or an automated trading program really do? It must first establish some rules for the trade which will be in the form of some technical indicators or price patterns as evaluated by the computer. Then it must apply these rules for profiting from market events, as signals are generated throughout the trading day, and into the future. What does the back testing prove? If the rules were applied in the past, the program would have registered profits. What must the program do? It must make profits for us in the future because historical profits may make us smile, but they will not add a penny in our pockets – unless we’re selling a forex robot.

Now, if the program established potential success in the past, why can’t we expect the same results to be repeated in the future? Since the charts look very similar on the whole, why can’t we expect those back testing results to be transformed to future profits? There’s this little disclaimer at the bottom of every legitimate forex broker’s webpage, which states that past performance does not guarantee future results. What does that mean? It means that financial markets are chaotic processes in which the prevailing rules change all the time according to dynamics which are not well understood as yet. In other words, the technical rules that are valid today will not be valid tomorrow. The technical methods that generate profits today will not do so in the future, because the mathematical processes that define the price action change all the time. Most definitely, there’s no single mathematical process or formula that can be applied to generate consistent profits in the market. All that the back testing results prove is that at some point in the past, there were technical methods the use of which could be profitable for the trader. But we want to know what the successful technical method will be tomorrow, not two days ago, as we don’t own a time machine that will deliver us back in time to trade the markets with the hindsight we possess.

And if you have any difficulty in accepting the above statement, consider your own experiences in the forex market: How many times have you seen that a technical indicator, a trading strategy, a combination of technical tools that worked five minutes ago, is unsuccessful just a short while later? Now wouldn’t you laugh at yourself if you had taken the combination that had worked five minutes ago and declared it to be a universally valid tool for all time? We know for sure that regardless of how successful our technical configuration was five minutes ago, it will fail regularly in the future because of the random nature of price movements.

But some will contradict us and say:

“The back testing results are used to choose the trading systems that were consistently successful over a much longer time than five minutes. You’re simplifying the methods and tools of the creators of these systems grossly, and putting yourself in a ridiculous situation by the simplicity of your argument.”

To that we will respond by reminding the traders of the fractal nature of the price graphics. In other words, the price action has a strange tendency to repeat itself with very subtle changes over a long period of time. The patterns observed in a five-minute chart can still be identified in a five-year chart. The randomness, unpredictability of the price formations are no different on five-year long charts than they are on five minute charts and the length of the back testing period is of very little consequence as a result. If a trading robot can be shown to trade successfully on five minute charts only on a consistent basis, that would be a powerful hint of its eventual applicability to many more time frames too. There has never been such a forex robot and if there will be one in the future, it will definitely use very different methods for trading the markets.

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Forex Robots and Trading Signal Software: Who has the Holy Grail?

Real Source: http://www.forexfraud.com/forex-articles/forex-robots-trade-signal-software.html

We do not know what use was made of the Holy Grail, if it had ever existed. Nowadays, perhaps some forex robots and trading signal software hold the key! However, if the Knights of the Round Table derived any advantage from any association with that legendary item, history doesn’t provide a lot of details on the nature of the benefits. It seems the bards and the poets of the Medieval era were the greatest beneficiaries of the Grail legend, selling their tales at the courts and ensuring a full stomach in the process, if not more. The tradition is alive even today, with “Holy Blood, Holy Grail”, the “Da Vinci Code” all reaping their share of the profits from the propagation of this ancient, dubious, yet highly entertaining legend.

The currency trading field has its own share of these bards and poets, each telling the same story from a different angle, embellishing it with new and exciting details on the unimaginable benefits, the unparalleled gains that one can achieve once he is in possession of the Holy Grail, the Forex Code, the Universal Secret of Trading, the Best Automated System in History. Times change however, and the blood of Christ no longer has the same powerful impact on the minds of believers as it had in the past. Nowadays, the scientifically minded, but gullible individual will seek the Holy Grail in some kind of mathematical formula, a numerical trick, some technical tool that will reveal the secrets of profitable trading to the entire universe.

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Effective Date of Amendments to Forex Requirements

Real Source: http://www.forexfraud.com/forex-articles/new-cftc-and-nfa-rules-and-regulations.html

NFA has received notice that the Commodity Futures Trading Commission has approved changes to NFA Bylaws 306 and 1507; Compliance Rules 1-1, 2-36, and 2-39; Code of Arbitration Section 1; Financial Requirements Sections 1, 11, and 12; and the Interpretive Notice Regarding Forex Transactions. Most of these changes ensure that NFA has jurisdiction over leveraged off-exchange foreign currency contracts when NFA Members act as counterparty to, solicit or introduce, or manage accounts on behalf of retail customers. The remaining changes are technical amendments that clarify the existing forex requirements. All of these amendments became effective on February 13, 2007.

The amendments adopt a new section (b) to Bylaw 1507 to define "forex" as any leveraged off-exchange foreign currency transaction offered to customers who are not eligible contract participants. The definition does, however, contain a limited exclusion for transactions that either 1) result in actual delivery within two days or 2) create an enforceable obligation to deliver between a buyer and seller who have the ability to fulfill that obligation in connection with their line of business (e.g., bona fide hedging activities). The amendments also incorporate this definition into NFA's other forex requirements by reference, eliminate language made superfluous by the new definition, and revise the introductory language to the Interpretive Notice to make it consistent with this definition.

Finally, the Board adopted several technical changes to the existing forex requirements. Those changes:

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Who we trade with?

Real Source: http://www.forex-directory.org/forexarticles/forexparticipants.php

Each person who is exchanging money in whatever purpose contribute to forex volume. You can say that all people are forex participants in some way because they are using money. We'll focus on trading participants who are using forex market in order to realize profits.

First group would be individual traders. They are people like you or me who invest their own money using some brokerage as a middleman. This group is biggest if you look at number of people who are making this group as you can find literally millions of independent traders out there. Although independent traders are largest group main liquidity is provided by commercial, investment and central banks. Banks are moving huge contracts everyday between themselves making most of daily volume on forex market. Biggest and most active banks on forex are as follows: Bank of America, First Boston, Morgan Stanley, Goldman Sachs, HSBC, J.P. Morgan, Credit Suisse, UBS Warburg and Dean Whiter. Other forex participants are numerous corporations, hedge funds, financial institutions and import/export companies. All together participating daily in foreign exchange market, its members are building up enormous volume creating most liquid market on earth.

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Forex Strategy: Trading with Stochastics

Real Source: http://www.straightforex.com/forexstrategy.html

Stochastics are amongst the most popular technical indicators when it comes to Forex Trading. Unfortunately most traders use them incorrectly. In this article we will review the correct way to use this popular technical indicator.

George Lane developed this indicator in the late 1950s. Stochastics measure the current close relative to the range (high/low) over a set of periods.

Stochastics consist of two lines:

%K - Is the main line and is usually displayed as a solid line
%D - Is simply a moving average of the %K and is usually displayed as a dotted line

There are three types of Stochastics: Full, fast and slow stochastics. Slow stochastics are simply a smother version of the fast stochastics, and full stochastics are even a smother version of the slow stochastics.

Interpretation:

Buy when %K falls below the oversold level (below 20) and rises back above the same level.

Sell when %K rises above de overbought level (above 80) and falls back below the same level.

The interpretation above is how most traders and investors use them; however, it only works when the market is trendless or ranging. When the market is trending, a reading above the overbought territory isn't necessary a bearish signal, while a reading below de oversold territory isn't necessary bullish signal.

Trending market

When the market is trending is necessary to adapt the oscillator to the same conditions: When the market is trending up, then the signals with the higher probability of success are those in direction of the trend "Buy signals", on the other hand when the market is trending down, selling signals offer the lowest risk opportunities.

Thus when the market is trending up, we will only look for oversold conditions (when the stochastics fall below the oversold level [below 20] and rises back above the same level) to get ready to trade, and in the same way, when the market is trending down we will only look for overbought conditions (when the stochastics rise above de overbought level [above 80] and falls back below the same level.

Taking all overbought/oversold signals during a trending market will lead us to many whipsaws. If you are not comfortable with the number of signals given, try expanding your trading to other currency pairs.

Trend-less market

During a ranging market we could use the interpretation explained above to trade off stochastics.

Divergence

Divergence trades are amongst the most reliable trading signals in the Forex market. A divergence occurs either when the indicator reaches new highs/lows and the market fails to do it or the market reaches new highs/lows and the indicator fails to do it. Both conditions mean that the market isn't as strong as it used to be giving us opportunities to profit from the market.

Stochastics can also be used to trade off divergences.

Price behavior

A price behavior can be incorporated into any kind of system or Forex strategy. When using divergences or overbought/oversold condition with a price behavior approach, the probability of success of our signals increases enormously. Why? Because price dictates at the end, how all indicators will behave, it also gives us a lot of information about the probable direction it will take in the future.

I hope this article helps you become a better trader.

Don't forget to read our risk disclaimer.

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Currency Trading For Dummies

Real Source: http://theforexarticles.com/2010/09/22/currency-trading-for-dummies/

Currency Trading For Dummies is a very popular forex trading book written by Mark Galant and Brian Dolan. It is targeted mainly towards those people that are new to forex trading, and covers every single aspect of currency trading in some detail.

The Currency Trading For Dummies book, which has been the top-selling forex trading book on Amazon for some time now, is 360 pages long and is divided into 5 parts. There are 20 chapters in total and they cover a wide range of different subjects, as you can see from the list of contents below:

Introduction

Part 1 - Trading The World's Largest Financial Market

Chapter 1 - Currency Trading 101
Chapter 2 - What Is The Forex Market?
Chapter 3 - Who Trades Currencies? Meet The Players
Chapter 4 - The Mechanics Of Currency Trading

Part 2 - Moving Currencies: Driving Forces Behind Forex Rates

Chapter 5 - Getting To Know The Major Currency Pairs
Chapter 6 - Minor Currency Pairs And Cross-Currency Trading
Chapter 7 - Looking At The Big Picture
Chapter 8 - Understand And Applying Market News, Data And Information
Chapter 9 - Getting Down And Dirty With Fundamental Data
Chapter 10 - Cutting The Fog With Technical Analysis

Part 3 - Developing A Trading Plan

Chapter 11 - Training And Preparing For Battle
Chapter 12 - Identifying Trade Opportunities
Chapter 13 - Risk Management Considerations

Part 4 - Executing A Plan

Chapter 14 - Pulling The Trigger
Chapter 15 - Managing The Trade
Chapter 16 - Closing Your Position And Evaluating Your Trading Results

Part 5 - The Part Of Tens

Chapter 17 - Ten Habits Of Successful Currency Traders
Chapter 18 - Ten Beginner Trading Mistakes
Chapter 19 - Ten Rules Of Risk Management
Chapter 20 - Ten Great Resources

Index

The Currency Trading For Dummies book is not that useful for experienced traders like myself, but I think it's ideal for anyone who wants to learn the basics of forex currency trading. If you want to buy this book, or simply want to read some reviews from people who have purchased the book, you can do so by clicking on the following link:

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Better Understand Technical Analysis and Some Indicators

Real Source: http://www.earnforex.com/articles/better-understand-technical-analysis-and-some-indicators

We're focusing on technical analysis in this article with a description of some of the important indicators.

We could say, all wealthy traders use technical analysis but not all technical analysis traders are wealthy although T.A. is the most precise way of trading the Forex market. It's also useful note that fundamentals play their part in indicating whether a price will move up or down. It gives you the edge over other traders.

Technical Analysis is so powerful because of a few reasons

1) it represents numbers. All information and its impact on the market and traders is represented in a currency's price. 2) It helps to predict trends and the foreign exchange market is very 'trendy'. 3) Certain chart patterns are consistent, reliable and repeat themselves. T.A. helps us to see them.

Here's one way of putting technical analsysis into perspective (wish I had a dollar each time I said 'technical analysis'). We all know that prices move in trends. Research has shown that those that trade 'with the trend' greatly improve their chances of making a profitable trade.

Trends help you become aware of the overall market direction and often rescue us from less then profitable entry points. I attended a 2 day course costing me over $2500 AUD and the biggest thing I learned from it was the need for discipline and emotional control. The content was so basic that within the next 3 or 4 articles, I would have covered all of it. So learning the 'tools of the trade' the technical indicators and their applications will help you to diagnose what the market is doing but even then you need to expect ups and down and trade with emotional control.

Stay with the trend, follow the price.

Find the price of the currency pair. If EUR/USD is 1.4224 and moves to 1.4180 then 1.4090 then the market is in a down trend. Concern yourself only with what the market IS doing not what it might do. Listen to the markets and the indicators will backup what they are telling you.

Moving Averages. Tell you the price at a given point of time over a defined period of intervals. They are called moving because they give you the latest price while calculating the average based on the selected time measure.

They lag the market so to give you an indication of a change in trend, use a shorter average such as a 5 or 10 day moving average. By combining a shorter term and longer term M.A. you can detect a buy signal when the shorter term crosses the longer term moving average in the upward direction. Or a sell signal if it crosses in a downward direction. For example, you could use a 5 day versus a 20 day moving average or a 40 day versus a 200 day moving average. There are simple moving averages, linearly weighted which gives more importance to the recent prices or exponentially weighted. The latter is a favourite because it considers all prices in a time period but emphasizes the importance of the most recent price changes.

MACD Based on moving averages, a MACD plots the difference between a 26 exponential moving average and a 12 day exponential moving average, with a 9 day used as a trigger line. If a MACD turns positive when the market is still plummeting it could be a strong buy signal. The converse also works.

Bollinger Bands (sounds like an elastic band) Prices tend to stay between the upper and lower bands. They widen and become more narrow depending on the volatility of the market at the time. A sell signal would be when the moving average is above the Bollinger bands and vice versa for a buy signal. Some traders use it in conjunction with RSI, MACD, CCI and Rate of Change.

Fibonacci Retracement Describe cycles found throughout nature and when applied to technical analysis can find shifts in the market trends. After a climb prices often retrace a large portion sometimes all of the original move. Support and resitance levels often occur near the Fibonacci retracement levels.

RSI Relative Strength Index measures the market activity to see whether it's overbought or oversold. This is a leading indicator so helps to indicate what the market is going to do (awesome!). Ahigher RSI number indicates overbought (so expect a bearish shift) and a lower number indicates oversold.

Successful traders will generally use 3 or 4 signals to provide a more conculsive signal before entering a trade.

Always remember, "If in doubt, stay out!" . Technical analysis doesn't factor in political news, a country's economic profile or fundamental supply and demand.

Technical Analysis helps us figure out how much money to risk on a trade. How and when to enter the market and how to exit the trade for profit or to minimize loss.

I sincerely hope you find this article useful.

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Trading Wisdom and Quotes

Real Source: http://www.forextradingzone.org/trading

While retail forex trading is a relatively new phenomenon, on the institutional level it has been around for many years. Furthermore, there are similarities between all financial markets, so those that have been traders for a long time have developed their own wisdom. Much of this wisdom is contained in some inspiring quotes. Some of this advice may seem like common sense, but letting it really sink in can offer newer traders a moment of truth that can bring about a profound improvement in the way they view the market, and as a result, in the way they trade.

"The trend is your friend" - perhaps the best known trading adage of all time, it is meant to remind traders to always identify the prevailing trend, and never to trade against it, but rather wait for retracements and then enter trades in the direction of the trend.

"The market can stay irrational longer than you can stay solvent" - The way the market reacts to certain news or events may not seem rational at times, but there is no sense in trying to fight the market - it moves where it moves and does not care one bit about your opinion.

"A fool and his money are soon parted" - If you are not smart about where you put your money, you will most likely lose it.

"The trading rules I live by are: (a) Cut losses, (b) Ride Winners, (c) Keep bets small, (d) Follow the rules without question, and (e) Know when to break the rules." - Rules are important, but following them blindly does not necessarily lead to success. Know which conditions produced those rules in the first place, so that when the conditions change, the rules can too.

"Amateurs Focus On Rewards. Professionals Focus on Risk." - Experienced traders think first about how much they can lose on a trade, base their calculations on that, and then see if they are happy with the potential reward the trade offers. Novices usually do the opposite, blinded by the allure of quick riches.

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Forecasting Forex Trading

Real Source: http://www.earnforex.com/articles/forecasting-forex-trading

What is Forex or Foreign Exchange: It is the largest financial market in the world, with a volume of more than $1.5 trillion daily, dealing in currencies. Unlike other financial markets, the Forex market has no physical location, no central exchange. It operates through an electronic network of banks, corporations and individuals trading one currency for another.

What about Forecasting: Predicting current and future market trends using existing data and facts. Analysts rely on technical and fundamental statistics to predict the directions of the economy, stock market and individual securities.

For those who trade using the Forex, or foreign currency exchange, knowing how to forecast the Forex can make the difference between trading successfully and losing money. When you begin learning about Forex trading, it is vital that you understand how to forecast the Forex trading market.

There are a few methods that are used when forecasting the Forex. Each system is used to understand how the Forex works and how the fluctuations in the market can affect traders and currency rates. The two methods that are most often used are called technical analysis and fundamental analysis. Both methods differ in their own ways, but each one can help the Forex trader understand how the rates are affecting the currency trade. Most of the time, experienced traders and brokers know each method and use a mixture of the two to trade on the Forex.

One method used in forecasting foreign currency exchange is called technical analysis. This method uses predictions by looking at trends in charts and graphs from past Forex market happenings. This system is based on solid events that have actually taken place in the Forex in the past. Many experience Forex traders and brokers rely on this system because it follows actual trends and can be quite reliable.

When looking at the technical analysis in the Forex, there are three basic principles that are used to make projections. These principles are based on the market action in relation to current events, trends in price movements and past Forex history. When the market action is looked at, everything from supply and demand, current politics and the current state of the market are taken into consideration. It is usually agreed that the actual price of the Forex is a direct reflection of current events.

The trends in price movement are another factor when using technical analysis. This means that there are patterns in the market behavior that have been known to be a contributing factor in the Forex. These patterns are usually repeating over time and can often be a consistent factor when forecasting the Forex market. Another factor that is taken into consideration when forecasting the Forex is history. There are definite patterns in the market and these are usually reliable factors. There are several charts that are taken into consideration when forecasting the Forex market using technical analysis. The five categories that are look at include indicators, number theory, waves, gaps and trends.

Most of these can be quite complicated for those who are inexperienced using the Forex. Most professional Forex brokers understand these charts and have the ability to offer their clients well-informed advice about Forex trading.

Another way that experienced brokers and traders in the Forex use to forecast the trends is called fundamental analysis. This method is used to forecast the future of price movements based on events that have not taken place yet. This can range from political changes, environmental factors and even natural disasters. Important factors and statistics are used to predict how it will affect supply and demand and the rates of the Forex. Most of the time, this method is not a reliable factor on its own, but is used in conjunction with technical analysis to form opinion about the changes in the Forex market.

For those interesting in being involved with Forex trading, a basic understanding of how the system works is essential. Understanding both forecasting systems and how they can predict the market trends will help Forex traders be successful with their trading. Most experienced traders and brokers involved with the Forex use a system of both technical and fundamental information when making decisions about the Forex market. When used together, they can provide the trader with invaluable information about where the currency trends are headed.

Always leave the forecasting to the pros unless you are playing the Forex as a hobby and don't have a lot of money invested...Or like most people you will learn the hard way.

by David Mclauchlan

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Bollinger Bands

Real Source: http://www.earnforex.com/articles/bollinger-bands

Contracting bands warn that the market is about to trend: the bands first converge into a narrow neck, followed by a sharp price movement. The first breakout is often a false move, preceding a strong trend in the opposite direction.

A move that starts at one band normally carries through to the other, in a ranging market.

A move outside the band indicates that the trend is strong and likely to continue — unless price quickly reverses.

A trend that hugs one band signals that the trend is strong and likely to continue. Wait for divergence (when the price is flat or rising or falling, but the MACD is going in the opposite direction...the price will break out in the direction of the MACD) or a Momentum Indicator to signal the end of a trend.

I use the BB's for indication of when a breakout or breakdown is imminent. When the outside bands get very narrow, it means the price is consolidating and is getting ready for a breakout, either up or down.

At this point, it's dangerous to have a position because you don't know if it's going to break up or down. When the bands get very narrow, it's almost better to close out your old positions, even at a loss, until you see a clear direction. If you don't want to close out an old position at a loss, at least hedge it. See more about hedging later in the Advanced Day Trade Forex course.

The BB's can't tell you which direction the breakout will be, the Chaos Oscillator (MACD) and Momentum will do that, and I always trade in the direction the Momentum and Chaos (MACD) are going.

Sometimes when using the slower timeframes, I use the outer BB's as targets for my limit sell price. If the bands are really wide after a big move, I use the middle band as my limit target price.

Bollinger Bands are designed to capture the majority of price movement. When prices move beyond the upper or lower band, they are considered high (overbought) or low (oversold) on a relative basis.

More On Using Bollinger Bands:

First, the BB's can be used as I mentioned before, as price targets. If the bands are narrow, the price will be jumping up & down within the two outer bands. As mentioned before, this is not the best time to be putting on a trade, as the trading range is too narrow, unless you can make a decent quick profit in a 1 or 5 minute chart.

If the range isn't too narrow, you can ride it up and down and book pips. I only attempt this in a 1 or 5 minute timeframe using the 5/9/18/50 EMA's. Don't do it if you can't make at least 5-10 pips up and down. The danger is in whipsaws.

Most of the time, unless the bands are too narrow, you can make trades by literally bouncing off the outer bands.

This is called "The Bollinger Bounce".

When placing a trade, just set your stop at the outer BB and your price target limit sell order where the other outer band is.

If your trade rapidly approaches the limit price and all your indicators say that the price movement is just getting started & not likely to quickly reverse on you, then you should first either remove your limit price & let the price run, or, raise your limit price another 5-10 pips. Then raise your stop to either your entry point or past it, to lock in either breakeven or some profit in case the price suddenly reverses on you.

This is definitely what you should do in a price breakout. If the price keeps going up in an extended breakout, you just keep adjusting your stop upwards to lock in more profit (this is called a trailing stop, more later on this subject) and keep raising your limit also.

A Super Advanced method of using BB's is to use two sets of BB's, both with the middle band set at 18. Set one BB to a standard deviation of 3 and leave the other standard deviation at 1. This gives you 6 short term support/resistance lines to work with. Your initial stop and target are the outer bands, and your inner bands are used for your trailing stop and short term resistance and support. You can also trade off the two inner bands.

This method is very similar to using Fibonacci OR Average True Range (ATR), but is much easier to use and understand.

by Cynthia Macy

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The Best Forex Broker: One for Everyone

Real Source: http://www.earnforex.com/articles/the-best-forex-broker-one-for-everyone

Dishonest and illegitimate brokers who defraud their customers are a disgrace to the online Forex brokerage business. Many traders are rightfully scornful of those who lack the basic decency to allow them to withdraw their funds, even after losses. And sometimes traders can't help but feel that if they could just locate that best Forex broker hidden somewhere in the far reaches of the cyber-jungle, trading and profiting would give the taste of fine French wines, instead of the usual vinegar. But are Forex brokers really such a wicked lot that even the Evil One himself is put to shame by his incompetence in comparison? Is the oversight of multiple government agencies, newspapers and the trader community insufficient to convince them to behave like normal people? Most importantly, since retail Forex is like a shower of gold and silver for online brokers, do they really need to kill their Golden Goose by defrauding traders and destroying their Forex strategies through misquotes and stop-running?

The fact of the matter is that the number of fraudsters in the Forex market is a lot smaller than what many disgruntled traders believe. If you have the misfortune of being a victim of one of them, no doubt, our words will not do much to help you trust the brokers. But we invite you to recall the fact that there are a significant number of firms which have been in operation for many years in nations where regulation and oversight is strictest. Surely, a broker with a long history in Switzerland does not prove much about the reliability of Forex brokers, but others headquartered in New York, and monitored and authorized by the authorities for years cannot have had the skills to keep everyone blind for so many years. Forex is risky, and requires patient study, but it is no longer a shady corner of the internet world: it is regulated and monitored, and more and more a part of the mainstream of financial business.

And while we'd love to send you to the best broker in this article, the good news is that we don't even need to. There are a large number of firms operating online today which cater to different kinds of investors with different expectations and skills. If you're a professional, you will not be equally satisfied by the offer of a decent, legitimate broker which caters to beginners and average traders for the most part. As a beginner, you're unlikely to have all your needs expectations fulfilled by a well-established firm with excellent services and yet a significant minimum deposit requirement. It is this diversity of offers that makes online Forex the field of pioneers, and such an exciting place to be for traders. If you're one of those brave people who want to explore this brave new world, go check your Forex broker ratings now, and who knows, maybe you'll grow to become the next Martin Schwartz of the century. Anything is possible in Forex.

By Carl Hayes

This article was brought to you by forextraders.com, the premiere destination for Forex strategies, analysis, news and commentary. Run by traders for traders, forextraders.com offers you an extensive online library, along with a comprehensive Forex school where you can grow from a Forex rookie to a formidable trader in the course of a week. In-depth reviews with clear-cut Forex broker ratings complete the picture for the most powerful online resource on Forex trading. Pump up your career, go and visit forextraders.com now!



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Choosing Your Forex Broker... Important Facts

Real Source: http://www.earnforex.com/articles/choosing-your-forex-broker-important-facts

The best advice I can give to you is to conduct yourself like a boss interviewing a potential employee. This employee will be making major decision on your financial future (or lack there of) and therefore it is of most importance that you ask the right questions. This decision cannot be taken lightly as must be well thought out. I would interview (more like grill) at least 5 potential Brokers before picking the final two.

When choosing a forex broker there are many factors to take into account.

— Trust

— Experience

— References from past clients

— Level of success

— Amount of advice to be given

— Convenience

— Amount of margin offered

— Speed

All of the above are of course important. In any financial transaction it is important to trust the broker you work with. This trust is garnered by the experience level the broker has. Of course there are some new brokers starting out who are quite trustworthy, but most people would rather work with an experienced broker. For that reason most new brokers attach themselves to a firm where they can be mentored and gain experience.

References from past clients are important. If your broker has helped someone else is successful in the past and that person is willing to speak up for him that says a lot. You can gage the level of success your broker has had by speaking with past clients and seeing how well they did working with this broker. Next, take a look at the amount of advice your broker is willing to give you. Of course, you make your own decisions and will never take another person's word for everything, but it is good to have knowledge to work with, and advice from an experienced broker is key information to factor in. Convenience is also impotent. If you live in California then an Ohio broker might not be the best choice. But in the age of the internet that factor has become less relevant. With fax and email where you and your broker live has become less important.

The amount of margin offered is important. Margin is used to leverage your money. A broker who gives you a 50 to one margin is more valuable than one who gives you 20 to one. And of course speed. Is your broker quick? Does he return phone calls and emails promptly? If so, perhaps you can work with him.

Your broker will b a trusted advisor and someone that you may be working with for years to come so choose the relationship carefully. Ask friends and acquaintances who are active in forex trading what broker they use and how they met. It is quite possible that you can get a referral from a friend or acquaintance you trust and acquire a good forex broker that way.

Another good way to find a forex broker is to go online. There are message forums, chat rooms, and email groups through portals like Yahoo, Google and MSN that contain a wealth of information. Getting onto one of these online communities and asking other people for advice is the way that many people found their broker. If a broker has several clients in an online community who are happy with what he has accomplished for them, then that is a good indication that you might be happy with him as well. Take advantage of the number of people who are on the internet and join some of these online communities. Ask question and you'll probably learn a great deal from the experiences that other people have had. Also find trade journals, magazines and ezines to subscribe to. Read as much as you can about the subject of forex trading before going into it. Become a smart shopper and smarter trader.

Finding a good forex broker is a job in itself. When you visit with a forex broker you are in essence conducting an employment interview to determine if this is the broker you wish to handle your financial affairs, so be thorough. Ask plenty of questions. Ask for references. Don't be shy. Also check with other people in the office of the broker and see if you would trust them to fill in for your broker if he were not available. And, see if the broker is willing to offer you a demo account to use to get in some practice before you actually make an investment. If the broker is able to do so and encourages you then it means that the broker wants educated clients and is not just out for the quick buck. See what kind of training and tutoring the broker is willing to offer. A good broker will offer to answer your questions and help you through the learning process.

by David Mclauchlan

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How To Spot Forex Fraud

Real Source: http://www.earnforex.com/articles/how-to-spot-forex-fraud

As the popularity of Forex increases so do the number of scam artists attempting to cash in on the Forex gravy train. Since Forex involves trading money internationally, often over the Internet, a whole new breed of scams have come about. Ironically many of these scam artists are finding their marks through newspaper, television or other print media advertisements.

While these scams are generally easily spotted by experienced traders, new speculators may have problems knowing the difference between what is real and what isn't. It is absolutely essential to thoroughly research Forex trading, and any potential companies you may trade with before making an initial investment. The last thing you need is to find out that the company you have invested with is under investigation by the SEC for fraud. In this type of circumstance it can often be impossible to retrieve your money as the claims from all fraud of participants will be higher than the total payouts the government can guarantee.

One way to spot a scam on Forex is when someone promoting a Forex system guarantees no risk. It is a fact that there is risk with Forx trading, and generally anyone who claims otherwise is a liar, or more likely a criminal. Trading in Forex successfully requires knowledge, discipline, and a trading strategy. But there is no magic software or no risk way to assure that you will make money.

Another red flag indicating a sure sign of a Forex scam is a web site that guarantees profits. Nobody can guarantee profits and Forex trading. It is up to you as an investor to perform. If it were possible to guarantee profits in Forex trading then nobody would need to start a business showing others how to make guaranteed profits. The profit potential for anyone who could guarantee profits would be so enormous in Forex trading, that they would quickly become a billionaire by trades. So why would they waste time teaching others?

Another common tactic of Forex scam artists is to promise employment opportunities for people using their system. This is usually a trick to get you to spend your money with them. They are fishing for people with capital who can fund their enterprise. They typically promise to offer firm money to people using their system. But why would they do this? Instead what happens is they lure people into their training systems and convince people that they have done so well in the training session that they should start using their real money in order to make a fortune.

All reputable Forex trading web sites will be a member of the CFTC or the NFA. Make sure to check the company's claims out and assure that they are members of one of these organizations before dealing with them.

Keep in mind that Forex is a relatively unregulated system of exchanging money. In many cases Forex scams can become highly technical, involving brokers manipulating prices in ways that cannot be tracked by the average trader. Because of this is essential that you not become a mark for such brokers.

In the United States the CFTC is the federal agency responsible for regulating the trade of Forex currency. If you suspect that you have been a victim of some type of fraud contact the CFTC. They have jurisdiction for investigating and enforcing the laws.

by Willie Reynolds

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Forex Signal Services

Real Source: http://www.earnforex.com/articles/forex-signal-services

What are Forex signals? Forex signals are paid services offered by some brokers and independent Forex annalists. Companies that offer forex signals monitor and analyze the market for you, providing you with their data via desktop alerts, email or even SMS and pager alerts.

Forex signal services analyze several factors when preparing their data. They do a technical analysis of market conditions and use a combination of indicators to identify trends and isolate profitable entry and exit points. They then send you the results via the venue of your choice and you can choose to use the signal in your own trading, or pass on it.

Most forex signal services offer signals for only a handful of the most popular currency pairs, such as EUR/USD, USD/JPY, GBP/USD, USD/CHF. Occasionally, you can find specialty services that offer signals for other lesser traded pairs. Forex signals can be costly, even upwards of $100 / mth. The benefit of subscribing to such a service is that they analyze and crunch the data for you, saving you time. It should be noted, however that using a signal service is no substitute for a proper education in the Forex markets. Signal services give you data, you still need to know what to do with it.

When shopping for a signal service, make sure that they provide you with historical data so that you can see their track record for yourself. Remember, that like any trader, Forex signal services also have loosing trades. You shouldn't expect a signal service to be a sure ticket to instant Forex wealth, but rather look at them as another tool in your trading toolbox.

by Amber Lowery

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Trade Idea Wrap-up: USD/CHF – Buy at 1.0050

USD/CHF - 1.0132

Most recent candlesticks pattern : N/A
Trend : Down

Tenkan-Sen level :1.0086
Kijun-Sen level :1.0085
Ichimoku cloud top :1.0045
Ichimoku cloud bottom :1.0009

Original strategy :

Buy at 1.0075, Target: 1.0200, Stop: 1.0025

New strategy :

Buy at 1.0050, Target: 1.0190, Stop: 0.9995

As dollar has retreated after intra-day rally to 1.0171, suggesting minor consolidation would be seen, however, as temporary low has been formed at 0.9933 earlier this week, downside should be limited to 1.0045-49 (previous resistance turned support and current level of the Ichimoku cloud top) and renewed buying interest should emerge there and bring another rise. Above said resistance would bring retracement of recent decline to 1.0210 minor resistance, however, near term overbought condition should limit upside to 1.0250/55 (61.8% Fibonacci retracement of 1.0451 to 0.9933) and price should falter well below resistance at 1.0278.

In view of this, we are looking to buy dollar on pullback, only below intra-day support at 0.9997 would abort and signal the correction from 0.9933 has ended, bring resumption of decline for retest of 0.9933.

No update on 17 Sept and next update on Monday 20 Sept.

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Euro's long term uptrend started in Feb 1981 at 0.5039 and is unfolding as a (A)-(B)-(C) move with (A): 0.8433 (Feb 1993), (B): 0.5682 (May 2000) and

Real Source: http://www.actionforex.com/trading-signals/elliott-wave-daily/trade-idea:-eur%10gbp-%E2%80%93-sell-at-0.8450-20100916122491/

EUR/GBP – 0.8378

Recent wave: v of wave 3 has possibly ended at 0.8067 but wave 4 should hold below 0.8600

Trend: Down

Original strategy :

Sell at 0.8450, Target: 0.8300, Stop: 0.8510

New strategy :

Sell at 0.8450, Target: 0.8300, Stop: 0.8510

As euro has risen again after intra-day brief retreat to 0.8310, suggesting near term upside risk remains for the corrective rise from 0.8143 to bring stronger retracement of the fall from 0.8532 to 0.8415/20 and possibly towards 0.8450/60, however, as wave 4 top has been formed at 0.8532, upside would be limited and bring another retreat retreated later. A drop below 0.8300/10 would be the first sign that top has been formed, bring weakness to 0.8250/60, however, only break of support at 0.8202 would confirm rebound from 0.8143 is over, then retest of this level would follow.

In view of this, we are inclined to sell euro on next rise. Above 0.8500/10 would risk a retest of 0.8532 but only break there would signal only a leg of 4 has ended at 0.8532, followed by b leg at 0.8143, then c leg of 4 may bring stronger rebound towards 0.8590/00.

On the downside, only break of support at 0.8143 would retain our bearishness and signal wave 5 decline from 0.8532 has resumed and extend weakness to 0.8100/10.

Our preferred count is that, after forming a major top at 0.9805 (wave V), (A)-(B)-(C) correction is unfolding with (A) leg ended at 0.8400 (A: 0.8637, B: 0.9491 and 5-waver C ended at 0.8400. Wave (B) has ended at 0.9413 and impulsive wave (C) is now unfolding with 1: 0.8603, 2: 0.9150 and wave v of wave 3 has ended at 0.8067 and the wave 4 correction has either ended at 0.8532 or may bring stronger retracement but reckon 0.8603 (wave 1 trough) would cap upside, bring subsequent selloff in wave 5.

No update on 17 Sept and next update on Monday 20 Sept

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EUR/GBP Elliott Wave Analysis

EUR/GBP – 0.8372

EUR/GBP – Wave (A) from 0.9805 top ended at 0.8400 and (B) ended at 0.9413

Although the single currency has rebounded after finding good support at 0.8202, if our view that wave 4 correction has ended at 0.8532 is correct, upside should be limited to 0.8410/20 and bring another decline later. Break of said support at 0.8202 would add credence to this view and bring retest of 0.8143, however, a daily close below there is needed to retain bearishness and bring further weakness to 0.8100 in wave 5, then retest of recent low at 0.8067 and later test of psychological support at 0.8000.

Our latest preferred count is that the wave V of a 5-wave series from 0.5682 ended at 0.9805 earlier and major A-B-C correction is unfolding with A: 0.8637, B: 0.9491 and wave C is a 5-waver with 1: 0.9158, 2: 0.9418, extended wave 3 ended at 0.8576 followed by wave 4 at 0.8868. The wave 5 has ended at 0.8400, this also mark the end of larger degree wave C as well as (A).

The rebound from there to 0.9413 is the wave (B) which followed by wave (C) and the break-down is 1: 0.8603, 2: 0.9150 and wave 3 has possibly ended at 0.8067 and a leg of wave 4 correction has met indicated upside target at 0.8481 and the retreat from 0.8532 suggests A leg has ended and B leg may bring weakness to aforesaid downside target but 0.8150 should contain downside. Looking ahead, a daily close below 0.8100 would signal the wave 5 of (C) is underway and bring retest of 0.8067, then psychological support at 0.8000 and possibly to 0.7900 but reckon 0.7744 (50% Fibonacci retracement of 0.5682 to 0.9805) would hold.

On the upside, above 0.8490/00 would prolong consolidation and risk test of 0.8532 but only break there would signal c leg of wave 4 is underway for stronger recovery, however, price should falter below wave 1 bottom at 0.8603.

Recommendation: Hold short entered at 0.8400 for 0.8150 with stop above 0.8490.

Euro's long term uptrend started in Feb 1981 at 0.5039 and is unfolding as a (A)-(B)-(C) move with (A): 0.8433 (Feb 1993), (B): 0.5682 (May 2000) and impulsive wave (C) should have ended at 0.9805 with wave III ended at 0.7254 (May 2003), triangle wave IV at 0.6536 (23 Jan 2007) and wave V as well as wave (C) has ended at 0.9805.
Therefore major correction has commenced from 0.9805 and weakness to 0.8230 (38.2% Fibonacci retracement of 0.5682 to 0.9805) would be seen first, then to 0.8000 and later 0.7744 (50% Fibonacci retracement).

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Trade Idea: EUR/JPY – Buy at 110.00

Real Source: http://www.actionforex.com/trading-signals/elliott-wave-daily/trade-idea:-eur%10jpy-%E2%80%93-buy-at-110.00-20100916122456/

EUR/JPY – 111.73

Recent wave: wave v has possibly ended at 107.30

Trend: down

Original strategy :

Buy at 109.50, Target: 111.50, Stop: 108.80

New strategy :

Buy at 110.00, Target: 112.00, Stop: 109.40

As the currency pair has maintained a firm undertone after early rally caused by MOF’s intervention, adding credence to our view that the wave 5 has indeed ended at 105.44 earlier and upside bias remains for further gain to previous support at 112.00/10, however, reckon 112.47 (1.618 times projection of 105.44 to 109.56 measuring from 105.80) would hold due to near term overbought condition.

In view of this, we are looking to buy euro on pullback but at a higher level. Below 109.50/56 (previous resistance) would defer and risk retracement to 108.90/00 but reckon 108.25/30 would hold.

Our preferred count is that the decline from 139.26 is wave C and is sub-divided into (a): 127.00, (b) 138.49 and wave (c) has commenced from there with a diagonal wave 1 (i: 126.95, ii: 134.37, iii: 120.70, iv: 125.24 and then wave v at 119.66). The rebound from 119.66 to 127.95 was an a-b-c wave 2 and wave 3 is taking place from 127.95 with minor wave i at 122.37 and wave ii at 125.97 and minor wave iii has ended at 110.49 and wave iv ended at 122.29, wave v ended at 107.30 as the wave 3, wave 4 has ended at 114.74 and wave 5 has ended at 105.44.

On the bigger picture, we are treating the rally to 169.97 as end of wave A, then selloff from 169.97 (July 2008) to 112.08 is wave (A) of B instead of end of entire wave B and then the rebound from there to 139.26 is wave (B), hence, wave (C) has commended from there with minor wave 1 ended at 119.66 and wave 2 at 127.95. This wave (C) of B should be limited to 105.00 and psychological support at 100.00 should remain intact.

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Foreign Exchange (Forex) Market Existence

Real Source: http://www.forex2u.com/forex-market-existence.html

Foreign Exchange (Forex) Market

Presently, there are various kinds of financial market, it is divided into: Stock market, interest market (including bond, commercial bill and so on), gold market (including gold, platinum, silver), futures market (including grain, cotton and kapok, oil and so on), option market and foreign exchange market or forex marketand so on.

The foreign exchange market is a place to trade foreign exchange currency, or it is also a place for the transaction of all foreign currency. The foreign exchange market therefore is existence, because of:

Trade and investment
Import and export business, people pays one kind of currency when doing business, but when earns another kind of currency when receive the commodity. This means that, when settling account, business people will pay and receive different currencies. Therefore, they must convert the currencies that they received into the currencies that they could buy commodities. With this similar, when buying a foreign property a company must use the concerned country's currency to make payment, therefore, it needs to convert the domestic currency is concerned country's currency.

Speculation
Currencies exchange rates could fluctuate according to the demand and supply between two currencies. A Forex trader buys up one kind of currency in an exchange rate, but up casts this currency in another more advantageous exchange rate, he may gain. Speculation has occupied most of the Forex market.

Hedging
Due to the fluctuation between two currencies, those companies who owns foreign asset (for example factory), when these companies convert these properties into cost country currencies, there consist of certain risks. When the value of a foreign asset which is estimated based on foreign currencies remained unchanged, if the exchange rate changes, when converting this property value according to the domestic currency, there could be profit and loss. The company may eliminate such hidden risk through hedging. This carries out a foreign currency trading, its transaction result just counterbalances the foreign currency property profit and loss which produces by the exchange rate change.

Forex Market Development

The history of the Forex market as an international capital speculation market is much shorter compared the stock, the gold, the stock, the interest market, but it is developing in an astonishing speed. Today, the foreign exchange market daily trading volume has amounted to 150 billion US dollars, it’s scale has gone far beyond the stock, the stock and other finance commodity markets, it has became the world's most biggest sole finance market and the also the speculation market. Since the birth of the foreign exchange market, the fluctuation of the exchange rate of the Forex market is becoming bigger. In September 1985, 1 US dollar exchanged 220 Japanese Yen, but in May 1986, 1 US dollar only could exchange 160 Japanese Yen, in 8 months, the Japanese Yen has revalued 27%. In recent years, the foreign exchange market wave amplitude has been bigger, on September 8, 1992, 1 pound exchanged 2.0100 US dollars, on November 10, 1 pound exchanged 1.5080 US dollars, in the short two months, the pound exchanged US dollar exchange rate to fall more than 5,000, depreciated 25%. Not only that, presently, everyday the fluctuation of the exchange rate of the Forex market enlarges unceasingly, within a day the rise and drop 2% to 3% is commonly seen. On September 16, 1992, the pound exchanged US dollar from 1.8755 to fall to 1.7850, the pound on first lowers 5%.

Due to the large fluctuation of the Forex market, it has created more opportunities for the investor, attracted more and more investors to join this ranks.

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What Is The Difference Between Forex and Futures?

Real Source: http://www.forex2u.com/Forex-VS-Futures.html

1. A Forex trader could trade more transaction compared to the futures market (the trading volume could be a times larger), and the risk will be strictly under control. The trading volume of the Forex market is 46 times larger compared to the futures market, moreover Forex traders could make more profit from the Forex market due to the larger trading volume (the transaction volume is a few times larger), the REFCO Switzerland rich transaction platform allowed transaction between 1-100 times to be carry on, moreover a Forex trader could decide his or her own transaction amount, for example: Your account has $30,000, the basic transaction unit is each $1,000 (which transaction amount in $1.00, million), namely, so the proportion of the margin of each transaction unit is 100:1.


2. The risk of the Forex trader is under control, such margin call will not happen compared to futures, through the Forex trading system, your risk will receive the strict limit, even if your margin if lower then the deposit required, the Forex trading system will automatically settle your position, this means even if a Forex trader suffered losses, moreover if the market is suffering from a disaster fluctuation, your loss could not surpass your account amount. In order to understand the advantages, please apply for the demo account to carry on the complete zero risk.


3. A Forex trader will receive a large limitation of liquidation and a relatively fair market because the trading volume of the Forex market is large and it is also the largest liquidation market in the world. At present the trading volume in the Forex market is 140 billion Dollars, such big market will completely digest your transaction cash.


4. A Forex trader may do 24 hours transactions and other markets are different, the Forex market is a 24 hour linkages market, it starts from every Sunday before dawn Australian Sydney market, substandard collect the transaction center Singapore, Tokyo, London, Frankfurt to New York continuously to open, such linkage market enable you to do 24 hours transactions, also provide flexibility for Forex trader to do transaction.

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Crown Forex – A Swiss-based Forex Broker Scam?

Real Source: http://www.forexfraud.com/forex-articles/crown-forex.html

Swiss-based forex broker Crown Forex will probably go down in investment history as just another disreputable forex fraud. Although, with a fancy Swiss address like:

St-Hubert 38, 2854 Bassecourt, Switzerland,

you might well have expected the company to be similar to Dukascopy or another reputable forex broking company of that caliber.

Nevertheless, that address belonged to the now defunct Crown Forex that went bankrupt in 2009, perhaps taking many of its clients’ forex brokerage accounts with them.

Unfortunately for its duped account holders, Crown Forex was in a great position just a few short years ago, as far as forex brokers were concerned. Crown Forex was apparently a top choice among brokers, having its own trading platform, a large client base and according to some, a considerable amount of money in the bank.

In addition to Crown Forex having an office in Switzerland and being a member of the ARIF or Association Romande des Intermédiaires Financiers — a Swiss-based regulatory agency specializing in the prevention of money laundering — the company must have pretty much looked “good as gold”.

Crown Forex: What went Wrong

Crown Forex seemed to be a legitimate forex broking operation until September of 2008. This was the initial period during which its customers began having serious problems with the fund withdrawal process.

Many of the forex broker’s clients had deposited in excess of $50,000 into their accounts, and they were having difficulty getting their money back, or even an answer from the Swiss-based firm.

Although some people with accounts were still able to get their money out at this early stage, many accounts were not refunded. Furthermore, since December of 2008, all funds held in accounts with Crown Forex have been unavailable to Crown Forex clients.

Basically, at that time in late 2008, the Swiss Federal Banking Commission or SFBC began investigating Crown Forex. The Commission stated that the company had no authorization from the SFBC for any activity in the financial sector in Switzerland.

By May of 2009, Crown Forex was being liquidated by Swiss regulators, and by December of 2009, a lawsuit was filed against Crown Forex by the U.S. Securities and Exchange Commission or SEC.

Crown Forex and the SEC Lawsuit

The SEC lawsuit in which Crown Forex is named as a relief defendant, along with twelve other forex, precious metals and futures funds, is primarily against two individuals, Trevor G. Cook and Patrick J. Kiley.

Other defendants in the SEC lawsuit include the “shell companies” under Cook’s and Kiley’s control that were UBS Diversified Growth LLC, Universal Brokerage FX Management, LLC and Oxford Global Advisors LLC.

According to the SEC, these two enterprising Minnesota residents raised in excess of over $190 million from 1,000 individual investors and promised them an annual return of between 10% and 12%.

The accounts were to be segregated individually, but instead the funds were pooled in bank trading accounts under the names of the shell companies that these two people controlled.

Around July of 2008, Cook and Kiley began advising their clients that their funds would be invested in segregated accounts at Crown Forex, S.A., a company based in Switzerland. The pair instructed their clients to fill out the appropriate new Crown Forex account forms and to issue checks made payable to Crown Forex for their account balances.

In essence, Cook and Kiley were telling their clients that their money, to the tune of $79 million, was now going to be invested via Crown Forex for forex trading. Nevertheless, what these two were in fact doing was depositing the money into a number of U.S. bank accounts controlled by them.

The Truth About Crown Forex Came Out

Eventually, the truth came out and Crown Forex wound up getting liquidated, as the apparent scam unfolded and the company stopped paying out the principal or profits in their customer accounts. Other companies involved with Cook and Kiley were also taken down, such as UniversalBrokerageFX.com, also known as UBFX.

Furthermore, Crown Forex had the following message posted on their website back in July of 2008 that now reads as if they were warning people about the impending potential loss of their funds:

“CROWN FOREX SA welcome all investors from all around the world, and we strongly recommend you to read the risk disclosure accompanying trading in the international financial markets before you proceed in the account opening process.”

The website then went on to warn potential investors even further:

“Dear investor, you have to be aware, and fully acknowledged that the possibility exists that you could sustain a loss of some or all of your deposited funds and therefore you should not speculate with capital that you can not afford to lose, totally or partially. And you should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent advisor if you have any doubts. Past returns are not indicative of future results.”

Thanks to the company being regulated in Switzerland and the SEC’s involvement in the case against them in the United States, some probability exists that people who trusted this company may receive some part of their money back.

Nevertheless, many people who had accounts with Crown Forex were probably put off of trading forex for eternity after placing their life savings into a forex trading account with the ill-fated broker.

Suffering this kind of gut-wrenching loss just does not sound like fun, so remember to research your forex brokers very well, or your money might grow legs and walk away as the scammed account holders at Crown Forex have now discovered is entirely possible even if the broker does have a fancy Swiss address.

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