Archive for March, 2009

Currency Trading Tips - Something\’s Gotta Give in Forex Scalping

By Daniel Su

You hear both sides of the argument when you are talking about forex trading strategies. There are those that swear you go short term or so called forex scalping, get in and get out and move on to the next deal and then there are those that will preach long term till they are blue in the face. While I personally prefer long term, I want to explore short term trading or forex scalping today.

With all the years of experience that I have behind me in forex trading, I can tell you with confidence that you can make money doing forex scalping, but it is extremely challenging and will eventually take its toll on you.

Successful forex traders are great analyzers. You get data, you crunch it and you spot a trend. The problem when trying to do short term trading is that by the time you get the numbers crunched, the trend is here and gone. Or worse, you are analyzing one and 5 minute charts and you think you spot something, but it is really nothing more than a random movement. The chances if being whipsawed is high, unless you have a very good forex trading system that can filter out the whipsaws in the market.

When you take those hits, they usually hurt. You will find yourself going to your stop margin more often than not and it will wipe away the profits that you made with all of your small hits. There is nothing more discouraging than winning 9 out of 10 times and having a losing session.

If you want to get involved in short term trading on the forex market, you better learn to eat stress for breakfast, lunch and dinner. The nature of trading short term means that you never have a second to relax and are constantly taking heat. You are trying to digest one and 5 minute charts and spot a trend before it changes.

Not only that, but as we just said, you can take one hit that will kill a weeks worth of profits. Add it all up and you will have a lot of sleepless nights. You like sleep, look at the daily trends, put your order in and walk away and let it happen.

While most people fall in love with the action of the short term win, they need to realize the name of the game is to win overall, not just on one trade. If you realize that you can make significantly more by developing a long term forex strategy that will allow you to spot one good deal that will make you much more than a bunch of scalpers. Learn forex the right way by viewing it as a long term business and you”ll be on your path to financial freedom.

So if you want to do forex scalping, you have to ask yourself is it really worth it? Something’’s gotta give. My experience has let me down the road of long term trades because they are less stressful, easier to recover from and easier to analyze. The business is stressful enough, why add to it?

About The Author

To learn accurate forex signals using a simple, proven forex trading system, download my FREE 56-page ebook at http://www.forextradingpower.com now.

The author, Daniel Su, is the founder of http://www.ForexTradingPower.com where you can get free premium forex trading tips and resources.

Stocks Trading and Following Rules

By Caterina Christakos

High return investments are usually defined as low risk and are mostly comprised of stocks, housing, or collectibles, such as gold, silver and platinum. While saving money in a passbook account is probably better than not saving at all, it is not judged as being a way of building great wealth. However, for the vast majority of the population having a savings account at a bank is best and the lowest risk for their needs. It also doesn”t accumulate capital gains to be reported on income tax.

Mutual Funds, though widely held by many investors, are not considered to be high return investments. Also, leveraged funds are not high performers. Land is considered a high return investment. Land is in short supply and is a low risk investment which equates to real wealth for those who hold onto it. Howard Hughes is a good example of getting high return on his investment of land located in Las Vegas. In his case, it was location, location, location. Costa Rica is also a location that investors are finding attractive for purchasing land.

What is a safe investment in recessionary times?

Let’’s face it, many investors in the commodity markets hardly know anything about it and so they can”t function effectively. Being a smart and successful investor requires time and dedication. To be able to function well in the stock market, you must acquire strategies that can fulfill all your desires and needs. In attaining success, you also need to consider other people or investors. In this article, you will learn more about stock trading and fundamental analysis.

In the stock market, you will meet a lot of investors. Basic needs are fulfilled by depending on one another but when it comes to stock investing, you need to be independent. You”re on your own, just like in a battlefield.

You can”t control or manipulate the stock market. In a natural environment, like your home, you need to control it (at some point) so that you can fulfill all your desires and needs. If you want to attain the same success in stocks trading, you must be able to control the market at some degree. Even if you can control the social environment, the techniques you”ve learned can”t be applied in the stock market. The only way to effectively manipulate and control the stock market in some way is to be a wise and large trader.

One way to be successful in stock trading is to control your behavior and the market information you”re dealing with. Since it would be impossible to control the stock market fully, you need to control or manipulate yourself. All the information you have should be viewed objectively and you need to ensure that you behave accordingly; thereby promoting your best interests. You must learn to create rules in how to trade wisely and you must strictly follow such rules.

Most stock traders find it very hard to follow rules but in order to achieve success you must follow a set of good stock trading rules. Put it this way, people also tend to resist societal rules. Perhaps it’’s already innate in humans to resist rules but if you want to be accepted by the society, you need to follow the rules. If you”re among those individuals who are attracted to stock trading, you will definitely enjoy unlimited freedom when it comes to choosing the stocks you buy or sell. In stock trading, you need to make a lot of decisions and so you will need to follow some rules and realize the boundaries.

Do you know some successful stock traders? The most successful traders are consistent, organized, and follow certain guidelines in order to generate more profits. Once you”re able to follow a good set of guidelines and rules, you will surely attain limitless success with very low loses.

People who resist rules all their lives will surely find it hard to follow trading rules and guidelines. They are those who often fail and lose huge money in stock trading. Take your time and know more about stock trading. If you”re a newbie, you should learn the basics of stock trading. Find out more info about trading strategies so that you can buy or sell stocks while gaining huge profits. If other people can achieve success in stocks trading, so can you. Start making your investments now and find a good broker; learn to follow trading rules as well.

Buying rental real estate is a good investment. The purchase of mobile home parks has proven to be a money maker in some areas for some investors. In particular, vacation resorts are a good location for mobile home park investors. Many families who are eager to see the United States in a more leisurely fashion, own trailer homes or vans and gladly pay the rental fee for a week in a great climate, like South Carolina or Florida. This income is high return, since not much is offered in the way of service except perhaps sewer hookups. Admittedly, because of the rise in gasoline prices, more families are turning away from travel trailers, but just like the stock market, gasoline prices will level off sometime in the near future.

About The Author

Caterina Christakos is an experienced investor and published author to find out more about trading the forex market go to: http://forexandcurrenciesexplained.com/

Forex Training Day - The Basics of Currency Trading

By Daniel Su

When you are getting ready to dive into the currency trading market, you have to realize that it is like anything else. You didn”t even play little league baseball without the proper training and when you are getting ready to become a trader, you need to educate yourself if get some forex training in order to be successful.

There are plenty of different tools that you can use to become a successful trader, but you are going to have to learn how to use them first. You many develop your own model or forex trading system after time, but you are still going to have to start out by using some of the more basic simple forex trading strategies that are available in the forex market. Remember to keep it simple and you will find that you make money more often than not in this market.

The first simple strategy that you should become familiar with is the simple moving average. When you are establishing this philosophy, you will want to keep the ratio of your risk and reward in line. In other words, you are not going to risk a large portion of your bankroll when the reward of the trade is minimal in relation to the risk factor. Initially, the trade may look great, but when you break it down you soon realize that you are putting up far too much money for what you are going to get back.

This forex strategy using simple moving can be implemented by establishing a point of the trade, say the 12 period SMA. When your currency pair goes above the line, it is time to buy and when it goes below the line, it is time to sell it off. The trader will always have a long and short position with this system and will always be in the market.

Another simple strategy that you can follow is support and resistance levels. In forex trading, the support position is the floor or the low point of the currency pair. In other words, it is supporting the trade to go to a higher level. I am sure that you have now quickly figured out that the resistance level is the ceiling or the high point of the trade at which it will head back down.

To comprehend this philosophy, assume that the EURUSD has shown time and again that when it gets to the level of 0.9015 you see that time after time it goes back down. It simply cannot get past this level. When you see this trend, 0.9015 is your established resistance level and when the currency either hits this point or gets close to it, you sell and reverse your position.

About The Author

To learn how to trade forex successfully using a simple, proven forex trading system, download my FREE 56-page ebook at http://www.forextradingpower.com now.

The author, Daniel Su, is the founder of http://www.ForexTradingPower.com where you can get free premium forex trading tips and resources.

Currency Trading - He\’s Just Not That Into Forex Day Trading

By Daniel Su

To say forex day trading is not risky would be a lie because it is definitely the riskiest form of trading in the forex market, but you can make money if you know what you are doing and have the ability to contain your emotions in this high paced environment. The risk and tempo are what keep a lot of people out of this aspect of it and going the long term way.

I once had a student Alvin who attended my forex training course and one day, he asked me if he should go for forex day trading using the forex scalping methods I”ve thought him. I told him forex day trading may be lucrative but may not be suitable for everyone. I went on to analyze the pros and cons of forex day trading with him.

Firstly, something that is a draw to forex day trading is the fast trading cycle. Many traders like the rush and potentially, it could actually be more fruitful than long term trading. Each individual trade may not make as much as a long term trade, but because you may be making 10 trades to every one of theirs, if not more, your profitability can actually be higher than that of the long term forex trader.

Another drawing characteristic of day trading is that you do not have the overnight worries of the long term trader. Your money is out of the market at the end of the day and if anything happens to affect the currency of a certain country, you just roll over and go back to sleep. The long term investor will be chewing on their nails waiting for the market to reopen.

Of course, with any positive there are negatives that have to be considered. The first of these is that the plain fact of the matter is that about 4 out of every 5 people that day trade end up losing money. There are several reasons for this. One of them we have already mentioned in the risk factor and another is that traders are pulled in by the lure of making very fast money and don”t do the work that is necessary to be a successful day trader.

Also, a lot of the people that are day trading are doing so on borrowed money. They are leveraging against their forex account and they end risking too much on one trade and then they end up in massive debt when a trade goes bad. It is not the forex market that is causing this, it is the trader that is not putting in the necessary work and effort to be an effective day trader.

Another thing about forex day trading you should know is that it will take up quite a fair bit of your time as you need to monitor the forex market very closely. Some part time forex traders overcome this by using automated forex trading system that trades for them.

If you”re having a full time job, it can also be quite distracting. Having heard my analysis, Alvin said he’’s just not that into forex day trading as he has a full time job and he does not have the time to monitor the forex market. Also, he said he does not need the extra excitement as his job is already stressful enough for him.

If you are still interested in day trading and have the time, give it a shot, but just do it conservatively. There are plenty of very successful day traders, but they take the time to create a successful forex day trading system that works and gives them an overall profit day in and day out. If you find that it is too much for you, just explore the long term aspect of this market niche as there is plenty of money to be made!

About The Author

To learn how to trade forex successfully using a simple, proven forex trading system, download my FREE 56-page ebook at http://www.forextradingpower.com now.

The author, Daniel Su, is the founder of http://www.ForexTradingPower.com where you can get free premium forex trading tips and resources.