Forex trading can be unpredictable. Many people coming to forex have great hopes. Sure, who does not dream of financial stability and independence? Everyone dreams of quitting his boring low paid job and become a forex trader. Why does forex attract so many people? There are many reasons some of them lie in the field of psychology. First of all, forex gives people the hope to get rich. Many people are greedy these days, so forex is the chance for them to become millionaires. Their main mistake is though inability to realize that there can be no easy money in forex.

Sometimes even experienced traders fail in forex. It does not happen due to lack of knowledge and experience. Traders who spent several years in forex do have knowledge and experience. Sometimes they fail because of greed and disrespect to forex psychology.

What is forex psychology anyway? This science is not lectured in the Universities. You will not read much of it in the books, although there is much information about it on the Internet. Anyway, forex psychology is very important both for beginners and seasoned traders.

What does forex psychology teach? Forex psychology teaches to master emotions. There is nothing worse than emotional forex trading. When you are angry you forget about everything. You do not mind economic indicators. You forget about market drivers. All you remember is that you need to earn money. But you totally forget about analytics. When you are too excited you cannot make reasonable decisions. Thus, you open positions not because your strategy suggests so but because you want to become a millionaire. Some traders picture in their minds cars and houses they will buy after big wins that usually never happen in their career.

Forex psychology helps to fight illusions. Indeed, you can win in forex. But you should understand that in order to win big money you are to risk big money. With a $100 deposit you will not be able to become rich. A $100 deposit will help you learn and gain experience.

Forex psychology teaches courage. Some traders are so afraid to lose that as soon as they see they win 20 pips they quit the market although they could stay and get 100 pips. But they prefer to close position because their have prior negative experience.

Forex psychology teaches to fight your greed and set realistic goals. Greediness is what makes most traders fail in forex. It is never enough. Everyone wants to earn more money. Well, some traders do succeed once or twice. That is called good luck. But short term losses mean nothing. You are to win in the long term.

Thus, forex psychology is extremely important for all traders.

Bookmark It

Hide Sites

A great deal of tools is available to help you to understand the Forex markets. In fact, there are so many tools available, that you may not know where to begin. Once you believe you understand the market itself, you can begin to explore tools that can help you to predict how the market will change.
Software programs and robots abound on the Internet. Each one is supposed to make your life a little easier when trading on the Forex market. The platforms also offer tools of their own to fine-tune your decisions. Understanding these tools can be difficult. Forex charts and patterns can help you if you understand them.
In the 18th century, Japanese rice traders developed a tool to help them predict the changes in price. This became known as the candlestick pattern. For some time, a line graph that showed the price was used. Next traders created a bar chart. It would show the open, close, high and low of a price over a period in a two dimensional chart. More information was visible this way.

Charles Dow introduced the candlestick chart to the American stock market in the beginning of the 20th century. He did this because the candlestick pattern is visually easier to understand. Imagine a bar graph that has a number of rectangular boxes on it. Above and below each box is a vertical line. The line above the box is known as the upper wick. The line below the box is the lower wick. Depending on the market, different colors are used to color the box itself. If the closing price is higher than the opening price, one color is used. If the opposite is true, a different price is used.
As you can see, the candlestick chart is very easy to understand. If you are looking at a chart of currencies you are watching and most of the candles are one color (the color used for a bullish market), then you know that the trend is bullish. This chart and pattern can provide you with a quick snapshot of how the market is moving or not moving. In the Forex market, you need every advantage you can get to make quick decisions.
Therefore, check out the graphs provided with your software or look at those available online free. The chart can make a big difference in how you trade. Just remember you get what you pay for. The free charts may not be as up to date as the ones that come with a software package.

Bookmark It

Hide Sites

Forex Trading Analysis

Foreign exchange trading, what the hype is all about foreign exchange trading is all about making enormous money. Some investors have found it quite straightforward to make an enormous sum of money as the foreign exchange market changes daily.

Currency exchange , is the forex market. Offline and online you may find references to the currency market as FX too.

Currency trading happens thru a broker or a monetary establishment frequently where you are able to purchase other sorts of stocks, bonds and investments. When you’re considering getting concerned in the foreign exchange markets you need to know you are sending money to be invested with other nations. This is done to prop up the investments of investors concerned in specific kinds of hedge funds, and in the markets overseas.

Forex Money

The currency market might have your forex money invested in one market one day, and the day after your cash is invested in another country. The daily changes are decided by your broker or money establishment. When reading your statements and becoming more knowledgeable about your account, you may find that each type of currency has 3 letters that may represent that currency. As an example, the USD is $ , the Japanese yen is JPY, and the English pound sterling will read as GBP. You’ll also find that for each exchange on your account listing you’ll see info that looks like this : JPY / GBP.

This suggests that you took your Jap yen cash and invested it into something in the English pound market. You’ll find many transactions from one currency to another if you have money that’s scattered thru out the foreign exchange markets. Currency exchange markets trading by investment management firms are the firms you can have trust in with your cash. You need to find a company which has been working with foreign exchange trading way back to the early seventies, and not somebody just new on the block so you get the maximum for your hard-earned money. It’s vital that you watch out for firms that are turning up online, and frequently times from foreign nations that are stating they can get you concerned in the foreign exchange markets and trading. Read the footnotes, and know whom you are working with for the very best protection.

If you’re curious about trading on the currency market, you’ll find boundaries for investing are dissimilar from corporation to corporation. Often times you’ll learn you need at least $250 or $500 while other firms will need $1000 or $10,000. The company you are working with will set boundaries in how much you want to apply for an account with their company. The tricks that are online will tell you, that you just need a $1 or $5 to create an account, but you want to find out more about that company and where they do business before investing any cash, this is for your own protection while dealing in foreign exchange trading and markets on the web.

Bookmark It

Hide Sites

The big Forex trends last a long time and you can lock into them and make huge profits yet, most traders fail to do this, despite the fact it makes such big gains. Let’s take a look at how to do it correctly…
Below you will learn how to do trend following the correct way.

1. Don’t Focus on Market Noise

Most traders lose because they try and catch small profits, they day trade or scalp or are so pleased when they have a profit, they take it. If you do this, you will lose or make marginal profits. The fact is any currency trader is going to have losses and to compensate for them, you need to have big winners.

The successful Forex trend follower can lose 50% of the time and still make huge profits, because his profits are far bigger than his losses.

Look at a Forex chart and you will trends that last for many weeks or months and if these can be caught and held, huge profits are the result. So how do you catch them?

2. Use Breakouts

The simplest way to catch big trends is to trade breakouts, to new highs or lows on a Forex chart. If you look at any Forex trading chart, you will see the big trends start and continue ,from these breaks and by going with them and holding them, you can make big gains.

3. Place Stops Outside of Random Volatility

Most traders don’t understand, that you need to trail your stop outside of random volatility if you want to win. The losing trader gets so excited that he has a profit, he wants to protect it, and he brings his stop up inside random volatility and gets stopped out of the trade. What happens next?

The trend continues for months on end, piles up thousands in profits and he’s not in.

Understand this, if you keep your stop back outside of the market noise, you will make a lot more money. Accept that at the end of the trend, you will give a bit back. You cannot predict when a trend will end so don’t try, if you caught 60% of every major trend, you would be very rich.

Forex trend following works and the big trends yield big profits.

If you focus on these high odds trades, you will trade less and make more money, with less effort.

If you trend follow Forex correctly, you can enjoy currency trading success and a great second or even life changing income – so try it and you maybe glad you did.

Bookmark It

Hide Sites

USDCHF Analysis.
Being contained by the upper border of the rising price channel on 4-hour chart, USDCHF pulls back from 1.0794, suggesting that a short term cycle top is being formed. Sideways movement is more likely be seen later today and bottom of the channel would be tested by the end of the sideways movement. However, as long as the channel support holds, the price action from 1.0794 is treated as consolidation of uptrend from 1.0132, one more rise towards 1.0900 is possible after consolidation.

EURUSD Analysis.
EURUSD bounces from the bottom of the falling price channel, suggesting that a short term cycle bottom is being formed at 1.3585 on 4-hour chart. Move towards the upper border of the channel is expected later today. However, the bounce from 1.3585 is more likely consolidation of downtrend from 1.4579, one more fall towards 1.3400 area is still possible after consolidation.

GBPUSD Analysis.
After touching the lower border of the falling price channel on 4-hour chart, GBPUSD bounces from 1.5534 level. A short term cycle bottom is being formed. Sideways movement could be seen later today. Resistance is at the top of the price channel. As long as the channel resistance holds, we’d expect downtrend to resume and another fall towards 1.5400-1.5500 area is still possible after consolidation.

USDCAD Analysis.
No changed in our view, USDCAD remains in uptrend from 1.0224 and the fall from 1.0779 is more likely consolidation of uptrend. One more rise towards 1.1200 area is expected after consolidation. Key support is now located at 1.0545, only fall below this level will indicate that the uptrend from 1.0224 has completed.

USDJPY Analysis.
After a sharp drop from 91.27, USDJPY traded in a narrow range above 88.57. However, the rang trading is treated as minor consolidation of downtrend from 93.75, as long as the channel resistance holds, one more fall towards 88.00 area is still possible after consolidation.

AUDUSD Analysis.
AUDUSD might be forming a short term cycle bottom at 0.8577 level on 4-hour chart. Bounce towards the falling trend line is expected in a couple of day, a clear break above the trend line resistance could conform the cycle bottom and indicate that the fall from 0.9327 has completed.

Bookmark It

Hide Sites