Forex Trends - How to Follow Them for Bigger Profits

Forex Trends - How to Follow Them for Bigger Profits

By: Monica Hendrix

When you look back at a forex chart forex trends that last for weeks or months are easy to see but there much harder to hold in real time trading. There are huge profits to be made if you can milk the longer term trends but you must be aware of two main problems you will encounter.

Volatility within the Main Trend

When your are forex trend following you get constant pullbacks in price and you have to decide whether they are a trend change or a pullback and this is not so easy when money is on the line.

The dilemma you face is: Where should you put your stop so that you can stay with the trend but get at least a good chunk of profit should the trend turn.

For this you should have an understanding of standard deviation of price - if you don't know what it is - make it an essential part of your forex education.

Our view is to use trend line support and moving averages pullbacks to the 18 - 25 day moving average are normal and pullbacks to the 40 day moving average indicate a trend that might turn.

Once the trend is in motion, use the 40 day and trend line support as your stop.

Of course when the trend turns you give back a bit of profit but that's ok - if you caught 50% of every major trend, you would be very rich.

Don't ever try and predict when a trend might end or impose your view on the market let the market action tell you when you are wrong.

You Have to Accept Short Term Dips to Make Long Term Gains!

Many traders get excited when they get a profit and the bigger it becomes, the more excited they get - Every dip in open equity causes them emotional turmoil and they simply want to get the profit in the bank, before it gets away.

They end up snatching their profit and banking a marginal one - what happens next?

The trend continues and makes $5 10 or 15,000 and their not in yet, that's where they thought the price was going anyway!

They just didn't have the discipline to stay with them.

The fact is you must be disciplined and be prepared to take open equity dips - sometimes of thousands at a time, once a big trend is in motion.

This requires confidence and discipline in your forex trading strategy, an understanding of volatility and a mindset to put up with it, to seek a longer term gain.

Take a look at a forex charts and you won't just see trends at present that yield a few hundred pips in motion, you will see ones that could give you thousands or tens of thousands and you can get these trends with the right attitude.

If you have the discipline and the mindset to succeed you can make a lot of money from long term trends - you don't have to be perfect and you and you don't have to be clever, just have the patience to stay with the trend, until the chart tells you that your wrong.

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Online Stock Broker

Online Stock Broker

By: Tom Decruz

The fact is, only a registered stock broker can buy and sell shares in the stock market. Such an individual is registered on one or many stock exchanges and is authorized to transact on behalf of others. Apart from that, an online stock broker is very valuable to investors who are not technically inclined and have no or little prior knowledge of stock trading. Such investors can use their own online stock trading accounts to obtain necessary information and place online trades at any time of the day. Others, however, still require a human interface - a real person who will place trades on their behalf.

An online stock broker’s services definitely transcend the traditional format of trading in stocks personally or via the telephone. By using an online stock broker, the investor no longer faces the constraints of location and busy telephone lines. Information technology has made stock market software are reliable means of trading in stock on the Internet, and an online stock broker uses this on his client’s behalf.

An online stock broker requires considerable working knowledge of the stock market to help investors trade in stocks. Though they are independent of established brokerage firms, they are still bound by the same Government regulations that govern offline stock firms. They have in-depth experience in dealing with actively traded commodities and stocks.

By using such a stock broker, one gains greater access and can also save money on stock trades. Because of this, there are now many investors in the stock market than there have ever been previously. There are now any number of investment choices available, and online brokers can leverage these by the power of the Internet coupled with their own expertise and experience. They are the perfect alternative to full-service brokers, who are far more expensive.

There can be occasional hiccups while using the services of one’s online stock broker. For instance, the accelerated growth of online trading can cause busy servers at certain times of the day. This makes it difficult to log on to one’s broker’s website. This is not a serious limitation, and invariably applies only to the first and last thirty minutes of a stock market day. Even this limitation will become history as online trading matures.

Serious and regular investors tend not to limit themselves to a single online broker, since individual brokers often concentrate on specific segments of trading. For such investors, having multiple accounts set up with different online stock brokers makes perfect sense, since it gives them wider exposure. The most successful traders often have as many as four or five brokers, though a single reliable broker suffices for those who only trade occasionally.

For more information on online stock broker and other investment click here.

Business Planner and Stock Market Analyst Employed with Kotak Securities.

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Forex Point and Figure Buy and Sell Signals

Forex Point and Figure Buy and Sell Signals

By: Eric Stout

Traditional forms of technical analysis leave much room for interpretation and error when determining buy and sell signals. This includes the use of technical indicators, price patterns, and support and resistance lines. Point and figure charts, by contrast, are exact in calculating buy and sell signals.
Not enough traders are utilizing the benefits of point and figure charts in the forex market. I don't why that is. Maybe it's due to the relatively young nature of the forex market. Or perhaps it's due to the global nature of forex trading and the predominance of traders outside of the United States.
Point and figure charts were first applied in the U.S. by Charles Dow, of the Dow Jones Company. Dow applied point and figure charts in the late 1800's to stock price movements. Since then, the method has been used by savvy stock traders throughout the decades, but it's never caught on like other charting methods such as bar charts or candlesticks.
Even fewer in the forex trading world have used the point and figure method to trade currency pairs. There seems to be a willingness to study and adopt more complex and subjective methods such as Fibonacci retracements, Ichimoku clouds, and Gann projections to name a few. But these methods of analysis leave a lot of room for judgment and interpretation. In short, many of the technical methods in the forex market are subjective.
I encourage forex traders to start studying point and figure charts, which are the most objective and precise charts in the world. There's no room for judgment or interpretation when it comes to determining a buy or sell signal on point and figure charts. It's a "black and white" or "yes or no" type of question. Either a currency pair is on a buy signal, or it's not.
With point and figure charts, buy and sell signals are determined by examining a currency pair's movement. That's it. Time does not factor into the equation. Moreover, point and figure charts use a filtering technique to minimize the randomness that is associated with currency pairs. The filtering technique is called a three box reversal. A currency pair's movement is considered meaningful, i.e. worth charting, only if it's of a magnitude greater than three boxes. All other movements are considered too small, or too random, to be worth charting.
A buy signal is generated when the current column of X's exceeds a previous column of X's. But this buy signal can take place over many different intervals, depending on the box size of the point and figure chart that is being used. For instance, a day trader might use a very small box size chart when trading the EUR/USD, a box size on the order of five or ten pips. A long-term trend following trader, by contrast, might use a much larger box size of 100 to 200 pips.
A sell signal is generated when the current column of O's drops below a previous column of O's. But like the buy signal, a sell signal can occur across various intervals, depending on the box size in use.
Trading currency pairs with point and figure charts is an entirely unique and objective approach to profiting in the forex. I encourage you to consider learning how to apply point and figure charts to your trading. You will see how amazingly objective and precise point and figure charts really are and how you can quickly and accurately determine if a currency pair is on a buy or sell signal.

Eric is a former forex industry insider. He's been trading stocks, options, bonds, futures, and forex for over a decade. He first learned about point and figure charts in 2000 and has since become an expert in the method. He now applies point and figure charts to his forex trading. You can learn more about applying point and figure charts to your forex trading at: www.fxpnf.com

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Forex Trading Robots - Seeking Long Term Profits with Them Vital Tips You Need to Know

Forex Trading Robots - Seeking Long Term Profits with Them Vital Tips You Need to Know

By: Monica Hendrix

Forex trading robots are popular, the theory is you can simply plug and go then sit back make money and let the trading system do the work for you. It's a great idea and you can make money but you need to consider the vital points below to win.

Most forex trading robots have one vital flaw - they have never been tested real time and never actually made any profits! Forget the clever enticing advertising copy these systems will wipe your equity quickly. Look for the disclaimer below (or similar one) and you will see what I mean.

Look for This disclaimer and ignore the System!

"CFTC RULE 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading....Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown".

Of course after reading this you will see why they don't work and the odds are stacked against you. Would you trust a driving instructor who couldn't drive? Well thousands of forex traders trust vendors who have never traded. These forex trading systems have all been tested knowing the past price history and the track record is simply a simulation on paper and I wouldn't trust it and neither should you.

Find one With a Real Time Track Record and ...

Make sure you understand how and why it works and you are confident in its ability to deliver forex trading profits longer term. If you don't, you won't have the discipline to follow it through periods of losses and stick with it through these periods of drawdown to make longer term gains. Keep in mind that if you don't have the discipline to follow your currency trading system - you may as well not have one!

If you want one with a great record of success long term check out Richard Donchians 4 Week Rule, we have written on this frequently and its Keep in mind the above system is free and you can use it as you wish and it has been the basis for many a successful trading system.

A Forex trading system with a real time track record doesn't come cheap and you're looking to pay in the region of at least $1 - 2,000 upwards in price, so the 4 Week Rule which will out perform most sold robots anyway and is a great place to start and of course it's free.

Tip 3 - Robots are programmed by Humans!

There is this image that a robot works on its own but it can only work within the limitations of the programmer.

Humans think robots can think for themselves like some robot from Star Trek (but this is rubbish the markets have to many variables) and a forex trading system can only react not think independently. While they are programmed by humans, this doesn't mean they can't be successful they can - but there not perfect.

ALL Forex trading robots will lose for periods of time that's life but this doesn't mean to say they can't make profits over the long term, they can but you must be patient and disciplined.

The right forex trading robot can and will make you money. Just keep in mind there not perfect and you will need to have confidence in the logic of them, to follow them to long term currency trading success.

Get the right one and follow it with discipline though and you could make a lot of money.

NEW! 2 X FREE ESSENTIAL TRADER PDFS

For free 2 x trading Pdf's with 90 of pages of essential info on Forex Trading Systems visit our website at: http://www.learncurrencytradingonline.com

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Trade Forex on Auto Pilot with This Proven FREE Forex Trading System

Trade Forex on Auto Pilot with This Proven FREE Forex Trading System

By: Kelly Price

Many forex traders want to trade on auto pilot and simply follow trading signals generated by a system, without having to make subjective judgements. Here we are going to give you one for FREE which is proven in terms of its profit potential.

The system is Richard Donchian's 4 Week rule and has been the basis of many successful trading systems around the world.

Big fans included trading legends such as Richard Dennis, so if its good enough for him its good enough for you!

The system was originally developed in the late 70s to trade commodities but can be used on any trending market and currencies trend well.

Now this system is so simple it consists of just one rule and here it is:

1) Close any short positions and go long whenever the price exceeds the highs of the previous 4 calendar weeks.

2) Close any long positions and go short whenever the price falls below the lows of the previous 4 calendar weeks.

If the system is run with a SAR (stop and reverse), the above system will always maintain a position in the market (either long or short).

Does it work?

Back test and you will see it does.

Of course it works very well in trending markets ensuring you are on the right side of every big move - but like all trading systems there is a downside:

It will get whipped in a choppy sideways market and here you may wish to consider some filters:

A common solution to this problem is to enter on the 4 week rule (the breakout), and to exit on a shorter time frame such as 1 or 2 weeks.

Traders can also use other exit rules i.e. exit when a moving average is broken. For example, applying a 10-day moving average as the exit - A 10-day moving average is one-half of the entry signal (four weeks is of course 20 trading days) is period we like. You can also experiment with ADX RSI and MACD filters if you wish.

Many traders ignore this system; after all it's not trendy or complex like chaos theory or artificial intelligence based systems, or full of mystical nonsense like Gann, Elliot Wave or Fibonacci - but it works.

Simple systems work better than complicated ones as they have fewer elements to break. If you are interested in making money long term and have a disciplined nature you will like this system.

If you believe complexity will beat the markets, they move to a scientific theory or enjoy the buzz of trading frequently - you won't like it - This system is all about making money long term in a disciplined fashion.

The 4 week rule is simple you can customize it to restrict losses, by adding filter and it will have you on the right side of every major move - do that and you have great profit potential.

So if you want to trade forex on autopilot and make big long term gains, consider this free system and you maybe glad you did.

NEW! 2 X FREE ESSENTIAL TRADER PDFS For free 2 x trading Pdf's, with 90 of essential info and more on Breakout Forex Trading Systems visit our website at: http://www.learncurrencytradingonline.com

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