forex trading

Forex Trading Made E-Z Review

This Forex Trading Made E-Z review will examine the system for trading on the foreign exchange currency markets developed by George C Smith. When you order Forex Trading Made E-Z you get an ebook and 12 training videos setting out the system in step by step form.

The basic structure is that you have the ebook which you can download instantly when you place your order (any time of the day or night). Inside the ebook you have the links to each video at the point where you need it. So you will see a written explanation of a chart or a technique, and there will be a link right there to a video that you can access on the internet showing you the actual action.

Strengths

The ebook is 84 pages but there are plenty of charts so there is not a huge ton of text to read and remember. This is basically one system and George Smith tells you how he trades using candlestick charts and latitude lines with the aim of increasing his bank by 5% each day.

5% each day may not sound much until you do the math. It comes out to mean that if you had no losing days, you would double your money every 17 days. In 90 days you could grow $100 to over $7,300. Of course losing days are a fact of life and if you don’t accept that you will be tempted to take stupid risks, so it is better not to expect anything like that speed of growth. George Smith’s point here really is that you should not be trying to make more than 5% a day.

The combination of ebook and videos is excellent. Most people’s best way of learning to do something practical is to follow along with somebody else showing them, and online videos are perfect for that. But it’s also good to have something you can print out on paper and refer back to quickly when you just need to check something.

Experienced forex traders will probably skim through the first few chapters of the ebook quickly and go ahead and try the system right away. Beginners should take it step by step and watch all of the videos.

One of the strongest points of Forex Trading Made E-Z is that it explains everything for the complete beginner, in the shortest and simplest way. There is no fluff about the history of forex trading or the relative merits of different currency pairs. It explains what you need to know to start making money and that’s all.

At the same time, there is a link in the introductory section to another ebook that you can download for free that will explain the theory in greater detail for those who want it.

Weaknesses

If there is one weakness it may be that complete beginners will be tempted to rush through the ebook without watching the videos. Some people who do this may be scared off by looking at the charts and techniques in later chapters which could seem complicated if they did not take time to understand what was going on in the earlier steps.

However, the bottom line is that to be successful with forex trading you do need to be happy looking at charts and figures and dealing with money. If the sight of a candlestick chart makes you run for the hills, you probably should not venture into the live markets at all.

On the other hand, if the first time you see a candlestick chart you are eager to find out what it means and discover patterns in the blocks of color, you could be well suited to forex trading even if you are a complete beginner right now. You will enjoy getting to grips with the system laid out in Forez Made E-Z.

Just be sure to go right back to the start, watch each video as you come to it and try out every tactic step by step. George Smith is not a big fan of demo accounts but if you are just starting out with forex trading I believe you should use a demo account for this system in the very beginning just so you understand exactly how each technique works. This saves you losing money just because you misunderstood something or applied one idea the wrong way around.

Support

To receive support you must opt in to the updates notification list when you are ordering the system. Then you will have the possibility of contacting George Smith personally if you need any help or clarification.

You will receive updates with new ideas, explanations and even links to new videos from time to time. So definitely don’t miss your chance to sign up for the updates list when you get Forex Trading Made E-Z.

George seems to be a friendly guy who will help you out if he can. Keep in mind though that you are not dealing with a huge company here. He is just one retired guy with limited time who is not going to be online 24/7. Allow a few days to hear back from him.

The Bottom Line

Gives you one clear system in double delivery through ebook and videos. Great for beginners who are wondering where to start among all the conflicting ideas about forex on the internet. More experienced traders can pick up new ideas.

Forex Trading Made E-Z review verdict: 5 stars.

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Thursday, June 25th, 2009 fx trading software No Comments

Forex Market Analysis: Which Type Is Better?

There are two types of forex market analysis: fundamental analysis, which considers economic, social and political forces and how they influence the currency markets, and technical analysis which uses charts to identify trends and patterns in the movement of prices.

So which one is better? If you check out forums and websites you will find many traders strongly supporting one or the other. Those who like to rely on charts will tell you that the only way to make money with forex trading is to identify trends and jump onto them as early as possible.

At the same time the advocates of fundamental analysis will argue that it is the economic factors that drive the changes in currency prices and this is undoubtedly true, at least most of the time. From that position they will reason that any patterns you might find on a chart are nothing more than coincidental.

But logically this does not necessarily follow. Even though economic changes have a huge impact on the currency markets, it may still be possible to identify patterns in the way that the markets react after an announcement or in times when there are no major announcements.

If on the other hand you rely solely on your charts, you are likely to be caught out when a major financial event such as an interest rate change is suddenly announced. You were not paying attention to the financial news and left a trade open at the wrong moment. That could result in disaster.

So the bottom line is that there are economic events behind the larger scale rises and falls in the market, but there are also common patterns that can be identified in the short term. Finding these patterns and trends, while keeping one eye on the economic and political news, is the best way to predict future price movements. And predicting future price movements, of course, is the way to make money with forex trading.

Foreign exchange market movements are a little like elastic that can stretch in one way or another and then fall back, although not always to its starting position. The fundamentals are the forces that cause it to stretch. Technical analysis predicts how far it will go in each direction before reversing.

So when you want to profit from forex trading it is better not to allow your attention to become fixed on either one. You need to learn to balance the use of both types of forex market analysis to make consistent profits.

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Wednesday, June 24th, 2009 Strategy No Comments

Forex Trading Forum Hints And Tips

A forex trading forum is a popular place for beginners to go when they are just getting into forex trading. There are many internet forums and you can discuss any aspect of currency trading there. But should you trust the answers that you get? Are these online discussion sites really a valuable source of information, or just a drain on your time?

Forums began in the time of the Roman empire. At that time they were a physical space in the middle of the city a little like a market place but without a market. The men of the city would meet there to hear and debate matters of importance such as politics and the law.

Since then the word has come to mean any location or group in which discussion takes place and opinions can be aired. On the internet, it has gradually taken over from the term ‘bulletin board’ which was used for the old style of sites where members could post messages. The new format of forums is much easier to navigate and people can more easily get involved in discussions than they could on bulletin boards.

This means that it is very easy to either start or join in a discussion. If you have a question you can post it and you are almost certain to see replies. For some aspects of foreign exchange trading this can be very useful.

For example if you are thinking of investing money, time or both in a forex system, ebook, robot or training program, it can be very useful to check a forex trading forum for reviews and feeback from people who have already used the product that you are considering. Use the search facility to see if there is already a thread about the product and if not, start one by asking if anyone has experience of the product. Feedback from other users can help you decide whether something would be suitable for you or not.

It is best to find several different opinions before making up your mind. Remember that one person’s opinion is only one view and you might not agree with that person. They might have been looking for something different, or they might have had unusually good or bad luck with the product. If you find a lot of different opinions it is much more helpful. You can see what kind of person has a good experience with the product and what kind of person has a bad experience.

If you have questions about trading, a currency trading forum can be useful too. But again you need to think about who is replying to your question. You might not necessarily want to trust everybody.

Sometimes different users will disagree with each other because they have different ways of making money with FX. There are many different methods and when you get conflicting advice it can be confusing. So do not be distracted by all the people who will tell you that their way is best.

It is very easy to sound like an expert in a place where nobody knows you. All a person has to do is to make a lot of posts and sound experienced. In fact a high post count often just means that the person likes hanging out in the forum and does more talking than trading. Some users may never even have traded for real at all, but only used demo accounts. Remember that you do not know who these people are. You should not automatically trust everybody’s opinion.

Finally, take care that you are not becoming an addict yourself. It is very easy to waste a lot of time following random discussions and chatting. Have a clear purpose when you enter a forex trading forum and leave when you have found what you were looking for.

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Tuesday, June 23rd, 2009 Strategy No Comments

What Is A Forex Pip?

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

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

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

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

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

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

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

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

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

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

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

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Thursday, June 18th, 2009 Glossary, Introduction No Comments

Electronic Currency Trading: How It Works

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

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

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

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

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

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

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

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

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

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

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Tuesday, June 9th, 2009 fx trading software, Introduction No Comments