forex

These are the Best Hours to Trade the Market

One of the great things about trading forex is that the markets remain open 24/7. Somewhere, that is. As the market opens in one part of the world, it closes in another, but there is always a market open for trading. However, not all hours were created equally, and it is not profitable to trade during specific hours. Knowing how to trade, when to trade, which pairs and where are all part of what sets novice forex traders apart from the more profitable and experienced traders. Here’s what you need to know to get started.

Trading Times in Forex

Basically, there are three time zones you need to know for trading. There is the London market, which opens at 3am and closes at 11am, the New York market, which opens at 7am and closes at 4pm and the Japanese/Australian market, which opens at 7pm and closes at 3am. So you can basically trade 24/7 if you want to. But, keep in mind that there are fluctuations within each trading time zone, so movements are not consistent throughout each session. Watch the market and make your trades when the markets are the busiest. During down times, take a nap and come back when the markets are booming.

Choosing the Best Trading Sessions

For the best results, choose a period during which the opening times of two markets overlap one another so you can trade two markets simultaneously. When two markets are open at the same time, you should see a higher volume and more volatility. For instance, when both London and New York are open, there are loads of trading opportunities on top of the regular movements of prices. Using your own trading plan during these time segments can yield great profits.

Potential Pairs

During the periods of overlap, the currency pairs that are the most active are the USD/CHF, the GBP/USD, the USD/JPY and the ERU/USD. The most profitable hours for those overlapping currency pairs are considered to be the 3 hours from 8am until 11am. This coincides with the times that various economic releases are published. Keep in mind that you’ll want to trade currency pairs at hours that the related markets are open.

Days to Take a Rest From Trading

Just as there are best hours and days to trade, there are also days that can be a total waste of time. Specifically, most traders go easy on Sunday trades. Nothing is moving with the currency rates on Sundays, so there’s not much to trade. The same is true on Fridays in the late afternoon. On Friday afternoons and on holidays, the markets can be unpredictable and it’s best to avoid them.

Markets Around the Clock

With forex, everything is related. Besides looking at the ideal hours to trade, watch what’s going on around the world. If one currency pair makes a big move either up or down, it will affect all the other markets. Pay attention and make the best trades, no matter what hours and pairs you choose!

 


Trade.com Forex and CFD Broker Review

Trade.com allowsImage and video hosting by TinyPic you to trade CFD and Forex worldwide. It is run by the investment company LeadCapital Markets. LeadCapital Markets is regulated by CySEC..Trade.com was established in 2009. They operate out of Cyprus and provide regular updates through their Twitter account. Currently, they are not accepting US citizens.

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Account Types

The site offers three different trading account types. The best account for you will depend on the amount that you have to deposit. The minimum deposits for each account are $100, $2500, and $10,000. Each account offers a variety of different features, with the premium account offering all of them to its users.

Classic Account

The classic account has a minimum deposit of $100. It’s perfect for people that just want to get their feet wet. With the classic account, you will receive access to their webinars and video tutorials to show you how to use the platform. You will also have a dedicated account manager that you can speak to and a 24-hour customer support service that you can contact if you have any questions or issues.

Standard Account

The minimum deposit for the standard account is $2,500. With the standard account, you will be able to receive automatic text messages that will notify you in real time with Trade.com Market updates.
This can help you make or save positions when unexpected events occur. Many people use this feature as a safeguard against their positions in case there is a sudden drop in the market.

Premium Account

The highest-level account that they offer is their premium account. The minimum deposit to open a premium account is $10,000. With this account, you will gain access to premium daily analysis which and gain access to their premium customer support.

With their premium customer support, you will receive impressive and immediate help from their top staff members. If you have a question, you should expect to get the answer to it right away with their premium customer service feature.

Opening an Account

Demo Account

If you are new to Forex trading, we recommend starting with one of their demo accounts. Their demo accounts are completely free to use. It gives you access to virtual money which you can use just like real money.
Use the virtual money in a demo account to simulate what you would do once you deposit real money into your account. Once you get the feel for the platform and understand how to earn on your investments, you can switch over to one of the normal accounts that they offer.


The 1-2-3 Method for Forex Trading

The 1-2-3 Method for Forex Trading

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The 1-2-3 method is a trading strategy that is used across nearly every investment market there is. Futures traders use it, stock traders use it, and now, forex trading is benefitting from this particular strategy. When it’s used correctly, this method offers traders the ability to predict entry levels with a great deal of accuracy.

The Bottom Line

Most often, when searching for how the 1-2-3 method works, investors are simply shown a few candlestick graphs with certain points circled for emphasis. That might work for some visually-minded investors, but others may not understand the point of the strategy simply by looking at a chart, so here it is:

The point, or bottom line, of 1-2-3 trading is to predict the end of a prevailing trend.

That’s it. You’re simply using data to get a clue as to when a trend is headed for a reversal. This is very well suited to the Forex market, because there are trends for the same assets across a variety of time frames, all of which can be analyzed and exploited to make the best trades possible.

Example: Down to Up

Let’s say you’re watching a downtrend in a particular currency’s value. First you need the most recent low, and the most recent high. Now, if the downtrend were to continue steadily along it’s downward path, the next high after the most recent low would be lower than the most recent previous high.

So, if you see that the next high is higher than the most recent previous high, that is your first hint that the downtrend is ending. This where the name “1-2-3 method” comes from in forex trading. The strategy is named for the three data points you need to get a hint that the trend is trading: the recent low, the recent high, and the next high.

In order to trade wisely, the next thing you need is confirmation. Watch for the next low: if the next low is lower than that most recent low you started with, the trend is likely continuing, and you just witnessed a little bump. However, if the next low is higher than your original recent low, you’re looking at a confirmed trend change.

Now What?

Once you’ve confirmed that a trend has changed, you still want to be sure you’re trading safely. The best thing to do is wait for the next high after your confirming low; if that high closes at a price greater than the third point in your 1-2-3 method, you’ve got a winner. Most forex traders would utilize the strategy now to trade long.

The 1-2-3 method can be used in reverse for uptrends. Simply watch for an overall downward pattern with the three data points. As traders get more and more comfortable with the market, they can eventually begin using this forex trading strategy to get in the door even sooner, which means their profit margins can be even higher.

Choosing the best strategy for trading can pay off big time with a little practice. Of course, no forex trading strategy works all of the time. The forex market is often considered one of the most volatile, so predicting trends isn’t always an exact science. But as far as methods go, this one has withstood the test of time throughout almost every trading industry, making it a go-to for most traders.

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Top 5 trading pitfalls that hinder success as a trader

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Getting success in future trading needs avoiding several pitfalls as much or more than it does seeking out and performing thriving trades. Even professional traders don’t have any particular trading methodology that ensures success as a trader though there are certain rules to which you can strictly adhere to keep yourself ‘in the game’ long enough to get success. Be it forex or future market, with the widespread of Internet, today’s traders use future or forex automated trading tools depending on their requirement. But whatever you use, you must avoid getting into any pitfall that would restrict your chance to succeed as a trader.

Here are 5 of the most prevalent mistakes traders generally make in future trading.

  1. Failure to have a plan – Failure to have a winning trading strategy in place prior to a trade is being executed. If you don’t have your own plan of action in place upon getting entry into future trade, you won’t know when and where you need to exit the trade or about how much money you can make or lose.
  2. Insufficient trading asset or improper money management – It obviously doesn’t take a fortune to trade in future market with success. If you have less than $5000 in your trading account you can and do your trade successfully. But if you have more in your account, you can and do even huge loss in just a heartbeat. Part of your success boils down to proper money management and not running after highly risky ‘home-run’ type trades which involve too much money at one time.
  3. High expectations, too soon – Being a new future trader if you expect to quit your ‘day job’ and make a good living trading future in your first few years of trading, you may get disappointed. You must avoid expecting to become successful in the first couple of years of trading. It needs a lot of smart and hard work, calculations and of course firmness to get success in any field and endeavor, and trading in future market is no different. Trading in the future is not that easy and so ‘get-rich-quick’ scheme hardly works out.
  4. Failure to use protective stop – Using protective buying stop or sell stop upon entering into a trade provide you with an effective idea of about how much money you is risking on that specific trade, should it turn out to be a loser. A protective stop is an excellent money-management tool though not perfect. There is plenty of money – management tools in future trading that you can use to achieve success.
  5. Lack of discipline and patience – Though over-worked and often mentioned when determining what a successful trader lacks, even the most veteran traders won’t argue with the merits of these virtues. It is always recommended that you don’t trade for the sake of trading only. Let an opportunity of ‘set-ups’ come to you and then you act upon accordingly in prudent and proper way. The market will go in its pace and you can’t control it.

These are some of several mistakes that traders, especially the newbies make while in the market. Avoiding such mistakes would give you the prospect to become a successful trader.


A Year’s Review of Forex Trading

To many observers, 2015 was relatively lacklustre one in terms of the financial markets. The S&P 500 is basically flat compared to a year ago, as it the yield to on 10-year Treasury bonds. The world of Forex trading is a complex one of sometimes arcane cause and effect. For those involved in Forex trading, there are a number of stories that can influence their trading decisions.

Time is money concept

Image Credit: investopedia

US Interest Rates

The Fed has finally agreed to a small raise in the US interest rates, the first such increase in seven years. To the casual saver this will result in a very minor increase in the return on CD’s and Money Market accounts. The bigger effect is likely to be a stronger US dollar. This may provide an uptick in foreign travel by US tourists looking for slightly better value for their vacation dollar. The long-term effect on the Forex market is yet to be determined.

Falling Oil Prices

The cost of a barrel of oil is about half of what it was at this time in 2014. This results in more money in consumers’ pockets. On the negative side, those heavily invested in the energy sector are suffering and income to oil producing countries is falling. Those working in the energy sector are also facing a very uncertain future.

Falling US Unemployment

Unemployment in the US is at 5.5%. To those who have been the victims of long-term unemployment, this is welcomed news. It also signals a problem for employers, especially those whose workforce consists primarily of low wageworkers. As the labour market tightens these companies are being forced to increase wages, and since most of these companies are multi-nationals the effect is felt in the US and abroad.

At the same time the underground economy in the US is rising, with some estimates having it at $2 trillion. The underground economy was once used to refer to illegal activities. Now those working in the shadows are just as likely to be in service industries and other legitimate concerns. While the underground economy has long existed in other parts of the world, it is relatively new in the US. Some estimate that the loss in tax revenue alone is about $500 billion.

In a world economy that is increasingly interconnected, it is easy for Forex traders to make assumptions based on stories such as those above. However the need for careful analysis is important. For example, the tighter US labour market has spawned articles that state that this will be good for the strength of the US dollar along with an almost equal number who state the opposite.
One of the best sources for accurate analysis in terms of how financial news is likely to affect the Forex market comes from highly rated and reputable Forex brokers, such as CMC Markets, which is rated in the top 10 of brokerage firms by Money.co.uk.


How to Invest With Less Stress

When it comes to managing investments, retail investors have more options at their fingertips than ever witnessed in human history. The internet has increased accessibility while decreasing the barriers to participation that once existed. For instance, trading in foreign exchange used to be exclusively the tools of multi-national corporations, banks, and financial firms. With the introduction of online brokerage and leverage, these instruments became readily available to the retail investing public for trading. This wave of opportunity has also created a more competitive environment amongst financial services providers which has driven down the costs for investors, namely for spreads and commissions. However, with the spread of technology and financial market accessibility, came certain risks for investors that did not conduct proper due diligence. These pitfalls include unregulated brokers, promises of profits, and advice from non-advisory entities.

An Industry Built on Evolution

Despite all the problems assoForex Trading Systemciated with the industry, there have been a multitude of positive developments. One suchevolution to come from these vast changes in the financial market structure is the proliferation of money management solutions that were once only available to sophisticated investors with millions of dollars in capital. Successful money managers have recognized the potential for unlocking vast sums of money from retail investors whom were previously untapped. This has caused the popularity of managed forex accounts to soar, with many options out there for investors who want to take a more hands off approach to fund management. While there is no such thing as a risk-free approach to investing (no matter what anyone tries to convince you of), this is one mechanism that is effective for diversifying a portfolio and picking a strategy that matches the risk-reward profile of an investor.

Depending on the services provider, the benefits can be numerous. Besides the obvious benefit of not having to micromanage trades all day, there is transparency to track performance in real-time and ability to pick strategies that matches investing goals. Traders operating proper managed forex accounts, aside from being licensed by the proper regulatory authorities, will also be able to provide an audited performance history to confirm accuracy of results. Good providers will not just highlight profits, but also not be afraid to offer more in depth statistics like drawdowns. Aside from performing proper due diligence on the trader, it is important to make sure the trader is utilizing a regulated broker with a solid reputation. Assuring safety and security of funds will add to the confidence of choosing a professional money manager.

Pick the Right Strategy

A successful investor understands the difference between needs and wants. In an industry that is dominated by promises of high rewards, it is imperative to look through the sales pitch and create achievable goals. Promises of get-rich quick opportunities should be met with caution. If it seems too good to be true, it probably is. Some providers offer 1000% returns to bring clients in the door only to later squander all the trading funds. While 1000% annual returns are possible, they are not very feasible, and typically require risking the entire value of an account. The search should instead focus on fund managers that are providing reasonable rates of return by taking a reasonable level of risk.

Finding the right strategy for a portfolio is paramount to picking the right managed forex accounts. For instance, in the case of a retiree, the strategy is typically more risk-averse and geared towards generating income, not capital appreciation. On the other hand, a younger investor that is not dependent on investment income could choose to focus on more high risk strategies that provide higher returns but also have substantially more risk. One suggestion is to pursue strategies that are not correlated to major market benchmarks like the S&P 500 or FTSE 100. Buy and hold strategies are typically the main retail investor tactics, meaning that performance is linked closely to broader market performance. Choosing uncorrelated strategies is beneficial because it means that in market downturns, positive investment performance is still possible.

In all, managed forex accounts provide a great means to diversify and complement existing investments. They provide a solution for investors seeking less investment risk and stress from the day-to-day management of trading accounts. While there can be pitfalls, proper due diligence and reasonable performance expectations can make this approach very beneficial for retail clients looking to have funds professionally managed.


Forex: Is It the Right Business for You?

The foreign exchange market remains a very attractive business proposition, in spite of the fact that there are certain obvious risks involved. The chances of winning big are also there. However, those of you are who take little time in relating “big wins” or “big losses” to “luck” and “gambling”, might think once again. Forex isn’t really the place to be— for you—in that case. As a potential trader, you must understand that forex is much more than the proverbial “pure luck”. In order to succeed here, you need to educate yourself and gain a thorough understanding of the marketing in the process. If you’re not ready to do that, then forex is not for you. Let us find out which kind of people is not cut out for stocks or the foreign exchange market or currency trading.

Forex Trading SystemForex is not for you!

It can be easily claimed that if traders or investors were a bit more serious about conducting some substantial self-study before trading, then the market would have seen fewer losses. It is advised that you refrain from trading if you don’t have the qualities mentioned below:

Patience

Forex is not meant for those who lack one of cardinal qualities (as far as forex is concerned). There are times when you would have to sit for long in front of the computers to watch charts and determine your entry point. Impatience leads many a traders to start trading before studying the chart thoroughly and getting an appropriate signal. Therefore, they are bound to close in a wrong position and lose a substantial amount of money in the process. One of the unmistakable attributes of successful traders is that they know very well when they want to enter or exit trades.

You need to exercise similar patience before you start trading as well. For instance, you have to practice with a demo account, for months before you start trading. Acquaint yourself with terms such as forex affiliates, conversion rate, commodity pairs, counter currency cross rate etc.

Ability to Control Greed

As already mentioned above, successful traders know when to enter the trade and the exit it. Yes, they exit trades after they secure the expected returns, without continuing for bigger gains. On the other hand, its greed, that leads most of the unsuccessful traders to hold on for too long, after initial success— thereby triggering risks of losing big, as well.

Ability to Control Emotion

Traders, who are primarily driven by emotions, should seriously consider their chances of getting in to forex. Emotion is one of the major factors influencing your standing as an investor. Exercising a firm control over your emotions irrespective of whether you’re winning or losing, is important. For instance, the situation highlighted above— when traders keep on betting even after securing their expected returns— is partially driven by emotions besides greed.

It’s the same emotion which leads them to hold on after suffering losses initially. Any successful or experienced trader would generally like to opt for a safe exit when they start suffering losses in a trade. They are quick to understand that it’s not their day and it’s only wise to resign for the day so as to keep the losses within control. The more emotional traders, on the other hand, hold on, expecting that they would end up winning, finally, even after the initial losses— thus, ending up losing a huge amount of money in the process.


How To Get Started In Forex Trading?

How to Get Started in Forex Trading?

Forex Trading SystemThe key to trading in foreign currencies is staying calm. Foreign exchange or forex traders speculate on movements in exchange rates, much like others would speculate on movements of stock prices. Even small exchange rate fluctuations can make a big difference to a forex trader. Market volatility is the place where traders make their money.

How to Trade FX

As a result of the unpredictability of currency markets, clever forex traders – who also call themselves investors – need to develop a plan. They have to set targets as to when they want to sell and buy their currency and, even more fundamentally, they need to adhere to it.

Forex trading has been gaining in popularity over the years, with forex brokers reporting a growth in clientele, especially over the past few years, as the Euro zone, the US and Chinese markets have slowed and governments have tried to spur growth by injecting cash into the economy.

Forex traders, who deal on their own personal accounts, follow the news closely. Their common warning is against playing with large sums of money. The uncertainty in the largest markets in the world enables forex traders the elbow room for playing around with global currencies.

There are indicators to keep a lookout for, such as the US Federal Reserve’s decisions, and trader reports from the European Central Bank. It is mainly at times of economic policy announcements that high volatility fluctuations – leading to high returns – happen.

Disasters, notably the Japanese earthquake and tsunami in 2011, also generate moneymaking opportunities by sparking market volatility.

What Platform to Trade on

To learn about forex there are companies providing access to the best trading software. One example is the Vantage FX MetaTrader 4 program which is also available on apple – and MT4 for Mac is becoming more and more popular by the day.

A web-based platform for forex, this provides the education, the low spreads, and other tools that traders need to come confidently into the market.

This sort of online forex trading platform offers customer care and attention as well as a choice of packages to suit the individual – seasoned trader or beginner.

At Vantage, for example, clients are provided with an account manager, meaning there’s just one point of contact for each trader, backed with support on hand 24/7.

Many people start out dabbling in forex trading in their spare time but the sort of success that can come with experience and an understanding of how the market works can lead many of these retail traders to give up their day jobs and concentrate on forex. Successful trading can give people the sort of cash flow, flexibility and even security that is difficult to find in the conventional world of work.

Plus, with the kind of software available today, forex traders no longer have to sit glued to their computers. If you would like learn digital trading read the binary options reviews. It’s possible for them to set stop limits, say at £1, $1.45 or €1, or a profit limit — say at £1.20, $1.65 or €1. But the most vigilant forex traders need to keep a very close watch on news, politics and even the weather.

Article by Robert Berkeley
Robert has successfully built Vantage FX UK Trading Limited, into one of the key players in the FX market across Europe with significant growth year on year.
Robert regularly blogs about forex trading and comments on major fx new events.


Understanding Fundamental Analysis

Forex Trading SystemWhen it comes to trading, whether you are dealing in options or forex trading, you will have two different options in terms of analysis. These options are technical analysis or fundamental analysis. There are many traders who have experienced success using either (or both) of these options; however, some experts believe that one is better than the other but in the technical vs. fundamental debate you will find opinion fairly equally split between the two. In this article it is fundamental analysis that I wish to examine in greater detail.

What is Fundamental Analysis?

According to Investopedia fundamental analysis is the evaluation of a security by trying to measure its value by taking into account related financial , economic and other factors. For example, in forex trading the security in question might be a particular currency and traders would perform a continual analysis of relevant information about that country in order to determine its currency’s intrinsic value. Some of the key indicators that would be examined during fundamental analysis in this case might include:

  • Interest Rates – interest rates are the driving force behind any currency and as a result they are examined closely by traders.
  • Gross Domestic Product (GDP) – this is a good indication of the overall economic health of a nation. If the GDP declines below expectations the value of currency will also fall.
  • Inflation – inflation is bad news for the economy. It is usual to expect an inflation rate of 2 to 3 percent, but anything above this then the currency of that country will also rise.
  • Unemployment Figures – economic growth in any country is driven by the people, especially the workforce. This means that if unemployment levels increase interest rates are cut which can devalue the currency.
  • Consumer Demand – as noted above, people are the backbone of a country’s economy. This means that a healthy economy requires a healthy level of consumer demand. When consumers are looking to spend money the economy grows and the value of currency grow with it.

Fundamental Analysis And Options Trading

payroll_functionsFundamental analysis is not just for forex trading, it can also be applied to options trading. Like with currency, there are a huge number of factors which can have an impact on the market price regardless of what you are trading in. There are also a number of different ways to source this information. Fundamental analysis means taking a lose look at all of this information in order to predict market trends. The more information you have, the more accurate your prediction will be.

The rules of fundamental analysis are not set in stone, in fact traders using this method are often considered to be ‘discretionary’. The analysis of this type of information is highly subjective and different traders will interpret it very differently. This is why you should not go to another trader for his or her advice, but instead make your own decisions when determining how the market will react to the latest company shake up or natural disaster.

Traders will find that their ability to predict market trends should improve over time as they learn more about the market and gain experience in fundamental analysis.

Liam Ball is a frequent contributor to finance blogs all around the globe. He enjoys options trading with epsilonoptions.com and finds that the more he learns the more successful he is.


Why Forex has Become Popular in the Recent Times

Investment is a popular means of income supplementation, and the most popular of its forms today is the Forex trade or the currency market. As implicit in the name, the currency market deals with the exchange of currencies hence the name Forex (foreign exchange).

The Forex market witnesses a massive worldwide participation on a regular basis and registers a transaction of about $4 trillion daily.  Before going into the chief reasons accounting for the popularity of this form of investment, let us just gloss over what the trade entails.

Forex – A hybrid of the terms foreign exchange, this market entails trading in various foreign currencies. The norm is to purchase a prefixed set of currencies like the EURO and the USD, at a reasonable price, and sell them when their value peaks. The valuation of the currencies in the pair is done against each other, i.e. they’re compared with each other. After the comparison, whichever currency seems to be the dearer one is sold against the other thus, resulting in a profit.  Thus, the entire operation is quite simplistic once you get the hang of it. Also, another advantage here is that, there isn’t any hard and fast rule dictating which currency you should sell when. It is completely the trader’s decision.

Apart from the simple operation procedure there are also two other factors which greatly boost the popularity of Forex investment. These are as follows:

  • Accessibility- In the last couple of years, due to the all pervading nature of the Internet, everything has become available at the click of a button. Naturally, the currency market also falls within the ambit of the Internet’s prowess, and due to the merging between both, foreign exchange has become an open investment zone for anyone and everyone; all that is required is an internet connection and basic knowledge. Thus, once you get initiated in the process and become aware of what happens and how, you can participate directly, without depending on any broker or middle man. This cuts down on your expenditure (broker’s commission) and helps you to amass more profits. Further, as we all know that the currency of any nation depends on a large number of national and international factors, these same factors indicate how the currency trade is going to fare; thus, any participant of the forex market needs to keep herself updated on all such events and there is no more easily and widely available source of such news than the Internet. Hence, not only has the market and any information about it, become increasingly accessible to the participants in the last few years, but also this has eliminated the ability of any one party to monopolize the entire sector.
  • Leverage – This is one of the most attractive features of the currency trade. Leverage in the forex market allows the traders to invest much more cash than they actually have deposited in their accounts. Thus, enhancing their chances of making a sizable profit. This normally takes place according to a prefixed ratio for e.g. in US the leverage ratio is set at 50:1. This means that for every $1 deposited in your account you can invest up to $50 in the market. Therefore, when you make an informed and accurate decision, the chances of your making a profit will be increased 50 times more.

However, in order to shield yourself from possible losses (due to leverage which can be more than you can handle), it is advisable that in your initial days you seek the help of a professional. Click here for further information on the topic of forex.


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