Deservedly popular
The forex market is rapidly gaining popularity worldwide. Suddenly, a large number of traders refuse to traditional stock and futures markets in favor of the forex market. However, the question arises - what attracts private traders in the forex market and if it fits for any and all traders? In this article we will try to answer this question by considering the pros and cons of the largest global financial market.
Mysterious market
In this article we priotkroem door to a new and mysterious to many traders and investors the world. This world is sometimes shrouded in a variety of myths, including that people lose in this market to their homes or remain with 5,000 bushels of soybean in her arms. Of course, we are talking about trading the commodity markets. But despite all these stories, trading in the commodity market does not necessarily mean higher risks, unless, of course, the trader knows what he is doing and take appropriate action. Rather, this market sector seems so mysterious and confusing, because many traders with him just not familiar enough. Even the mere mention of terms such as "commodity futures" and the "option contract" was enough to cause them a slight embarrassment.
Exchange and Casino
Many perceive the exchange as the casinos. This is not surprising. Surprisingly different. People who think speculation on the stock exchange the same game of chance, like roulette in a casino can be divided into two groups. Some very healthy people with normal mentality, others require a doctor. The first group consists of players who genuinely believe that the stock market and a casino - it is the same, and refer to it accordingly. They bring money to the stock exchange, wanting to enjoy the game. The gain (profit from stock transactions) is regarded by them as a nice coincidence, though desirable. They get pleasure from the process. They do not call myself ambitious goals, for example, greatly multiply the capital.
Market "gurus"
Market "gurus" have emerged from that moment on, as people faced with the market. In 1841 in England was published by the classic book on the market maniyam "extraordinarily popular delusions and the madness of crowds." Republish it today. Charles Mackay describes in her Tulip mania, the boom in the South Seas in England and other mass mania. Human nature changes slowly, and today the new mania, including mania following the "guru", continue to cover the markets. Thanks to modern means of telecommunications, "gurus" make their mania is much faster than before. Even well-educated and smart players and investors follow the market "gurus", like the followers of the medieval messiahs.
"Golden" system
Systems for the financial markets are used much more frequently than is commonly thought. For example, technical analysts use the concept of automated decision support systems, mechanical trading systems. System in the technical sense - is a set of inequalities and equations defining the rules for opening and closing positions. If a system of inequalities and equations is performed, there is a purchase or sale. When building systems used price levels, technical indicators, as well as predictions, obtained by probabilistic methods, neural network algorithms. Each technical system has a set of parameters, varying which can work to change the results (yield, the number of operations etc.) based on historical data.
Trade the system?
The futures industry is estimated at 28 billion dollars. Management of most of these funds successfully implemented due to a systems approach. If you make money using the system, then why a large number of small traders fail in the application of a systematic approach to their transactions? Here it is appropriate to explore the numerous reasons why people fail with systems. If we follow the trade of systems over a period of about 12 years, as confirmed by both traders are successful and failing, it is clear that trade on the system gives a solid profit margins and above average in comparison with other methods. There are several factors contributing to success or failure.
Leading symptoms
Economists generally grouped macroeconomic statistics in three categories: leading, lagging or coincident data. To draw an analogy with the car, it's like look at the road through the front, rear or side window. But as a trader or investor can determine the direction of the economy in this kaleidoscope of data? Coincident and lagging indicators provide market participants a confirmation of where the economy is now and where it was before, but in this article we will look at the leading economic indicators. They help us understand where the economy is headed.
Business "without costs"
The forex market, unlike other financial markets, linked to stock exchanges, has a unique feature which is used by many brokers to attract traders. They promise to pay for the lack of access to trading, no fee quotes and news data and, most importantly, the lack of fees. For a novice trader, just wanting to break into the commercial business, it sounds too good to be true. Trading without transaction costs seems like an obvious advantage. However, what may sound tempting for inexperienced traders, may not be the best choice. In this article we will discuss how to evaluate the structure of the board / commission forex broker and find out who is best suited for you.
Effective enforcement of trade rules
Execution may be the weakest link in the whole a good marketing strategy. In the end, it's easier to find a good market instruments than to trade them for a profit. So, how should we enter into the market just at the right time and capture the big moves that we see on the graphs? The rules for effective trade execution. Try to follow them the next time you are ready to enter the market.
Tunnel vision
How much background information as you receive each day trader? How many marketing tools in your checklist? How many checklists you follow? How many charts, news feeds, alerts, etc. is in your sight? These components of the initial information is an important element of your survival in the market. However, the trouble lies in the fact that they can sabotage your work. On the one hand, you can build a distinctive "cab trade management," which will run faster than it can work our brain. On the other hand, you can build a "cabin" with too many incorrect input data and a few right.
Profitable combination
Today on-line brokers offer various types of orders designed to protect investors from significant losses. The most common order is a "stop-loss", but there is another type of order, which should not be overlooked is the trailing stop. In this article we try to understand why a trailing stop quickly is the arsenal of active traders. One of the most common methods to limit the losses is to place the order "stop-loss" or fixed stops at the terminal of your broker. With this order, the trader fixes the price of closing of the transaction, based on the maximum loss, which he is willing to admit. If the market price moves beyond this threshold, a stop order becomes a market order and will be executed. Thus, once the price falls below (or rises above) the level of the stop, the position will be closed on the current market price, which prevents any further loss.
Market trap
One of the market phenomena, which many traders try to avoid, and justified reasons, it is a bear and bull trap. They are best described as a short-term breakouts of support / resistance before returning to the market to their existing range. The idea is to take advantage of the bull and bear traps after their identification, in fact benefiting from the potentially very powerful buy and sell signals. This is due to the fact that the penetration times, which are of such traps are usually due to triggering of stop orders, leading to rapid movement. As a result, knocked out of the market, those who were actually right in his view about the true intentions of the market.
Market cycles
We've all heard a lot about market bubbles, and there are thousands of examples of those who were caught in at least one of these bubbles. Although there are many lessons to be learned from past bubbles, market participants are still involved every time a new bubble. The bubble is just one part of an important phase in the markets, so if you want to avoid the trap, it is important to know what are all the stages of market movement. Understanding how markets work, and good knowledge of technical analysis can help you identify market cycles.
Roll-profit
One result of the extreme volatility due to the global financial crisis is that many private traders are now looking beyond simple trading strategies like buying shares. While traders are still looking for healthy returns, it is worth noting also a greater understanding of risk. Trading in futures and foreign exchange markets was attributed to the very end of the scale of risk, largely due to the factor of credit leverage. However, some trading strategies involve a reduced level of risk while maintaining excellent opportunities for profit.
Effective enforcement of trade rules
Execution may be the weakest link in the whole a good marketing strategy. In the end, it's easier to find a good market instruments than to trade them for a profit. So, how should we enter into the market just at the right time and capture the big moves that we see on the graphs? The rules for effective trade execution. Try to follow them the next time you are ready to enter the market.
How to install a stop
As a universal means of risk management generally recommended for tight stops. It is recommended that you either directly, assuming that you are risking only a small number of fixed points in a single transaction, or indirectly, through phrases like "control your losses," "quickly cut their losses," etc. The truth is that in many cases, tight stops may actually increase the losses. In terms of swing trading, we will consider why tight stops often do not work as they adjust to accommodate to the normal fluctuations of the market and how to compensate for this added risk. Finally, we also consider cases when tight stops may even be used.
Interval graphs
Traders often consider the intra-day price charts based on time intervals, such as 5 - or 60-minute periods. This means that a bar (whether or Candle OHLC-bar) will be marked on the chart at the end of each specified time interval. For example, a 60-minute chart of U.S. stocks will be marked with a bar at 9:30, 10:30, 11:30 and so on until the end of the trading session. It is the only option under consideration, the volume and trading activity is of no significance. Thus, there will always be the same number of bars in the trading day, using the same time interval.
Classical rules, time-tested
This is a list of classic trading rules that I gave at the time, when I traded in the stock room in 1984. More senior trader collected these rules of classical literature on trade in the twentieth century. Obviously, these rules have stood the test of time. I am confident that many traders have met with these rules in one form or another, but in this form they are quite compact and well-edited, making them easy reading.
Systems approach
The trading system is a set of formulas and rules that let you buy and sell signals. Trading systems have been developed several decades ago, but the recent surge in computer technology and the development of the Internet spurred the interest in them and expanded the number of people involved in their active use. Technical indicators such as oscillators, moving averages and Bollinger Bands are used most often to shape the rules for trading systems. Combinations of different technical indicators are also often used to create rules.
Learning the fundamental analysis
In the market leverage an equilibrium real interest rate at the level of r1. In accordance with the prevailing level of interest we have a certain amount of net foreign investments, which are also offering local currency in the foreign exchange market. We also have a definite relationship between real exchange rate and net exports, which is also the demand for domestic currency in the foreign exchange market. The real exchange rate at the level of lead in Er1 balance the foreign exchange market. The real exchange rate corresponds to a certain level of Er1 nominal exchange rate. The initial situation is shown in the figure below.
How to manage trade
Managing open positions is the most difficult task facing the trader. Danger can arise at any time and make good profits in a nasty loss. Too often, we jump up in a good position, only to see it fail because of poor trade management. This is especially true for newbies who think that the markets - a kind of game of "guess - do not guess."
Restricted movement
Traders that use range trading in the forex market, often take short-term consolidation of the ranges. When they select a range trading strategy, you often find that consolidation was not a long-range, but rather a short pause, which is technically looked like a band. Bands arise all the time, and as soon as the trader can visually see the range, it is often assumed that this growth will continue. As a result, this approach often leads to frustration and losing trades. However, there is a way to make currency pairs, moves are most likely to remain limited range and, thus, are more likely to yield lucrative deals with the strategy.
Additional profit
The percentage of rollover in the forex spot market is paid or debited from the trader for each open trade position at 17.00 EST (Eastern Standard Time) for each trading day. Transactions opened before 17.00 EST and held after this time are carried over to another day and, thus, are subject to charge / cancellation of interest, depending on the trade position, open the trader.
Bargain proportion
This strategy is based on the assumption that the levels of support and resistance patterns "double top" and "double bottom" exert their influence on price movements even after they have been violated. In fact, they act like a magnet, pulling prices back to those levels after the majority of stops were triggered. The logic behind this trade setup is that it requires a large buying power to exceed the value of the previous range of "double top", and vice versa for a breakthrough "double bottom".
What is the market FOREX?
This article is introductory and aims to explain to the reader what is the mechanism of the market FOREX, who its main actors, for what it is and what it perspektivy.Itak, the international FOREX market is based on a system of OTC transactions. Thus, the various global financial centers (such as Hong Kong, London, Tokyo, New York, and others) act as a kind of informal areas for carrying out currency transactions between different types of buyers and sellers. The FOREX market operates around the clock, except for Saturday and Sunday. As a result, thanks in FOREX, are determined by the relative exchange rates.
Methods of money management
Recall that a general list of the different methods of capital management is composed of seven main methods:
1. Lack of money management.
2. The method of multiple lotov.3. The method of a fixed amount subjected risku.4. The method of a fixed percentage of kapitala.5. Matching method of wins and losses at torgovle.6. The method, based on a moving average curve on kapitala.7. A method of optimal F. This article will be devoted to the method of multiple lots. We examine its strengths and weaknesses.
Where to invest today?
Many entrepreneurs are interested in how to maintain and increase earnings. Of course, first there is an idea to invest in their own business. But sometimes the additional investment for your business is not needed, or invest in a personal savings is not rational. In addition, many entrepreneurs do not want to "put all your eggs in one basket," and so willing to find alternatives for their money.
Production of the main indicators
The financial world is closely following the update of economic indicators and release some news is immediately reflected in the Forex market. There are 3 basic types of indicators of economic activity: the leading, coincident and lagging. A leading indicator of economic activity reported on upcoming events of the economy. He can advance to predict what will happen before it actually happened.
Top 5 Forex events over the past decade
Before you start make predictions for the future, we would like to appeal to the five most important events of the past decade, to what happened in the forex from 2000 to 2010. The last 10 years have been very important for all people. Important positive developments of the past decade - the birth of a social network, the growing popularity of Google, the online video revolution of YouTube and the debut of Apple products such as iPod and iPhone. There was also a negative event such as: global financial crisis, the tragedy of September 11 and natural disasters. All of these changes, one way or another, influenced the lives of everyone, but only some of them had a lasting impact on the world currency market Forex.
Forex market: a job or gamble?
Every person on Earth, one way or another, runs the risk every day throughout his life. Every time you go out of your home, you are risking your life. Every time you stay at home, you also risk their own lives. Tornadoes, earthquakes, unintentional shooting, a fire in the house, deadly viruses and bacteria, the world itself by itself - it is an unsafe place. More often than most of us do not perceive risk as something special and we need just a minute to decide to commit a particular act, often we do not even think about what we do.
Any unexpected movements can be expected from traders and investors of the Japanese yen?
August 2, during a press conference, Minister of Finance of Japan Yosihiko Noda declined to comment on the possibility of foreign exchange intervention against the government's claims about the possibility of emergency measures against too high an appreciation of the yen. Noda said he is a supporter of market mechanisms, but noted that his department is closely monitoring the currency market. These statements strongly vary a lot with that said Naoto Kan, has not as prime minister of Japan. What will these contradictions between the Treasury and Prime Minister of Japan? Intervene or not the Japanese government to market forces? Any unexpected movements can be expected from the investors of the Japanese yen?
Ukrainians have allowed deposits in foreign banks: who wins, who loses?
Earlier, opening an account as a private citizen with a foreign bank was like going to Calvary. It was necessary to pass a very simple registration procedure is not in the licensing system, starting with the filling mass of documents in domestic bank, which represents the interests of a foreign partner in Ukraine, to obtain a personal license of National bank, be interviewed by officials of law enforcement agencies.
Option strategies in the Forex market or how to change the car every year
Continuing to examine options strategies, we touch on a common strategy, as the spread. Most spredovyh strategies differ in the ability of stable profits at the expense of the probability of dropping out "jack-pot." If you like stability and is important for you to receive regular income while working on the options market, ensuring your prosperity, then spreads - just something that you should pay attention!
Forex or currency futures - that is the question!
In this issue, together with the brokerage firm NordFX, we continue a series of articles for beginners. In continuation of our discussion on futures contracts, which began in "futures - a multi-faceted financial tool to hedge, speculate and invest," today we look in more detail the specifics of trading futures and try to highlight the main features and benefits of currency futures trading before the market Forex.
Forex - the best, quasi-charged simulator for success
Of plans, ideas, goods of everyday life, did you try to escape from the hustle and bustle? If you tried, you have probably noticed that this is not very easy, and certainly not comfortable. You've probably noticed that your eyes are constantly moving and looking to jump from one fragment to another routine. Looking for something? No, not really, just like one can not.
The principle of sequential analysis of the market
The idea of a grain - is worth it to germinate in the soil, richly flavored with PR, as there is a huge mass of newly traders ready to buy or sell at the slightest signal. Fairly light fluctuations in the price, the news suddenly said something or the first persons that could provoke a wave of growth or decline in one or another trading platform. Agree, a great opportunity for, say, a large hedge fund to realize its interests and to sell where the crowd is buying. But I was just by the way. Now it is a little bit of something else.
How did the currency trading
Currency trading is the exchange of some money for other, of course, existed since time immemorial! But currency trading as a way of making money for millions of people has become available since the late 1970s. Now it is difficult to surprise anyone huge amounts of rotating in the global financial industry. Multimillion-dollar loans provided to bidders, practically for free. But the ability to access global financial markets, backed by credit means the broker is a thousand times superior to your own funds, and also transmitted to you in control - it is certainly something unimaginable for the world of financial investments of the last century!
Traders of all countries - unite: the trade unions - the fulcrum in the stormy ocean of investment
Even 20 years ago by an unknown author of these lines, do not hesitate to subscribe to every conscious citizen of the country. But the time inevitably moves forward, changing people's minds, attitudes, priorities ... The fact that yesterday was erected on a pedestal, now, alas, is perceived differently in a new way. But not for nothing that says that new - it is well forgotten old. Or not forgotten? The memory will remain forever these magical organizations, ticket and where can I get to the resort, and something "on the cheap" to buy. One word - union. Yes, there were times ...
India is not China or the algorithm ... "Indian miracle", other than the Chinese, through the eyes of investors
Comparing India with China and naturally of course: 2 countries with the largest in the world population had exceeded one billion, neighbors and non-competitors who claim to be leaders in Asia and around the world, having the highest GDP growth among the G20 countries and many other similarities.
For investors it is important to another - from India and China ... totally different algorithms phenomenal success in the world, and the overall difference between them must understand each investor.
European currency: what technical analysts hold back?
The global financial and economic crisis has shown the problems that have long been hidden behind a facade of European prosperity. Economists and financial analysts to build a different future scenarios for forecasts of the situation, which turned out to be a single European currency. The range of assumptions is unusually broad, from the apocalyptic to the unusually optimistic.
Leading news agencies and speculators of world renown claim that the euro could reach parity with the U.S. dollar, even become cheaper than him, which, respectively, lead to the collapse of the EU. However, the economic power of the EU does not allow such a unique look at the prospects of Euro-currency.
How to Trade Trends
There are four basic principles that should be part of any trading strategy. You must be sure that your trading strategy includes all of these principles required for success. Trade trends related to the definition of the rules of open positions. This requirement means that you should always open in the direction of current price movements. Mathematical analysis of prices shows that prices vary largely at random with a small trend component. This scientific fact is extremely important for those who want to establish their trade on a sound scientific approach. This means that any attempt to trade short-term figures or methods are not based on trend is doomed to failure.
Trend indicators and price components
As trade trends using trend component in the price movement, a successful trading systems use several methods to identify trends. A popular idea is to use a separate filter trend. This algorithm, which evaluates the pre-price dynamics and defines it enhances the availability, or down-sideways. There are different approaches to the design of filters trend. Some methods, such as moving averages, indicators include the presence of a trend in technology inputs. Other (not recommended for use by me) are trying to predict the impending change of trend and therefore give more input signal at a time when the trend is moving against the signal.
Market fraud
How long would be able to survive in the business of the casino, if the majority of its visitors are not lost, but won? Same thing on the market. In order to survive the market should act in such a way that the participants lost. Otherwise, where to get money to pay the winners, if the majority wins? Casino has certain advantages compared to the market - it can pre-set rules of the game, which will provide the owner of a mathematical advantage. The market also can not directly control how to play each individual player.
The only way to Daytrading
There are four basic principles that must be incorporated in any trading strategy. They are: 1) Trade trends, 2) reduce the losses, and 3) Give the return flow, and 4) Manage risk. To be successful you must be sure that your strategy includes all of these principles. Trade trend applies to how you decide to commit the transaction. This principle implies that you should always enter in the direction of current movement.
The use of a mechanical approach
People are starting to trade in goods, no doubt have succeeded in any other field. Without that success, they could not accumulate the necessary capital to trade. They suggest using the same rational approach to trade, which led them to the previous success. Unfortunately, it is this seemingly sensible methodology and causes them to collapse. Markets are organized so that the money is taken from many participants, and distributed among several. Otherwise, they can not exist. Based on this, obviously, something that appeals to common sense and seems appropriate does not work. Otherwise everything would become rich.
Optimization of Trading Systems
In a previous file of articles, I noted that the average person has the best chance to become a successful trader if he or she applies a 100% mechanical approach. This is the only reliable way to reduce the emotional impact that sooner or later destroy all traders. This is also the only way to evaluate your trading method on profitability based on existing historical data. Throw out the hope of finding ever a "perfect system". The perfect system of this month can bring losses to the next. It is clear that she will have many difficult periods in the future. Just as each trader and each methodology has a period of losses, and each trading system vnezavisimosti on how well it is created, will have periods when she would not be able to trade successfully.
Chaos theory and market
When a newbie begins to experience problems in their trade, their first reaction is the idea that success in the market he must learn to predict price movements. With a little effort, he finds that long-term predictions using fundamental analysis, and for short-term - technical. If our novice trader examines the history of prices of the market in which he works, he finds what seems to be repeating patterns. For a long time the markets move up and down a long cyclical waves. If he looks closely, he may find some short-term schedule for the shapes that are repeated again and again. Once it opens a world of mathematical indicators, he finds that certain combinations of indicators and figures tend to be repeated - often near the main peaks and troughs.
Measuring the effectiveness of outputs
In our opinion, yields a much more important than inputs, but most novice traders spend most of their time searching for the ideal entry strategy, as if it could solve their problems. During one of the seminars we ran the game, in which all entered the market simultaneously, and then conduct their own exit strategy to the extent that price changes were reported as a group. After about 10 rounds of quick play the results are usually varied from one extreme to the other. Several traders have greater profits, some have suffered great losses, the majority were in the middle. Very rarely happened that two traders had the same result. The aim of these simple activities to show the effect of exits on our results. All have the same input, but the results have ranged from significant to substantial earnings losses.
Forex: Myths and Realities. The View from London
In recent years, the word "forex" in Russia has become almost a dirty word. Having said that you - an employee of forex, you can catch yourself on the incredulous looks. Walking down the subway, turning on a radio or hitting the Internet, the modern Russian immediately confronted with the promise "to increase capital for dozens of guaranteed interest per month" and provide "direct access to global liquidity." Since this usually starts spanning journey into the world of the Russian Forex, which for someone succeeds, but often despair is replaced by the initial optimism and faith in the possibility of getting rich quick.
FOREX or stock market
Shares, investment companies, mutual funds, dividends, IPO - people in modern society often faced with all these terms. Many are involved with the opportunity to buy a small piece of a company (share) and cash in on the growth of its value. Of particular interest is the population in the stock market was caused by the heavy advertising of so-called "popular IPO» Rosneft, when all those who wish to buy a particle of national wealth. But taking an important decision to invest their funds, many did not think about possible alternatives to the stock market. This is the currency market FOREX, which provides an excellent opportunity to earn even in a crisis.
Forex after facelift
There are lots of promotional materials, detailing the why working in the interbank Forex market is much easier, better, cheaper than trading currency futures. But how many of them are true, and what - a myth?
"Stock" dollar
Knowledge about the correlation between specific financial instruments, awareness of their behavior under certain conditions makes it possible to make more accurate trading decisions. How correlated currency quotes and stock prices, and what "relationship" with the U.S. dollar and the Russian stock market?
Business "without costs"
The forex market, unlike other financial markets, linked to stock exchanges, has a unique feature which is used by many brokers to attract traders. They promise to pay for the lack of access to trading, no fee quotes and news data and, most importantly, the lack of fees. For a novice trader, just wanting to break into the commercial business, it sounds too good to be true. Trading without transaction costs seems like an obvious advantage. However, what may sound tempting for inexperienced traders, may not be the best choice. In this article we will discuss how to evaluate the structure of the board / commission forex broker and find out who is best suited for you.
Diary of a trader
Often, hearing the opinion that the market is constantly cheating, I remember the dialogue from the film and understand that it is likely incorporated something important. I remember that not so long ago an article appeared in The Wall Street Journal with the story about how the February 8th certain investment boutique Monness, Crespi, Hardt & Co. had organized a "Dinner of Ideas". Article and announced in her grave forecasts of financiers interested me. On the day reading the article I wrote a note titled 'Day dinner of chicken with lemon sauce. " Then, by the way, quotes, EUR / USD rate for 2 weeks remained in the range 1,35-1,3775, but in the last trading day in February quotations do not exceed the level of 1.3612.
Misconceptions and myths about FOREX
It is human nature to doubt. People tend to continue to sleep on an uncomfortable bed, go to the old car, go to the hated work. Why? Because any changes in our lives, even positive, as perceived by the subconscious stress. But life is too short to be sure. You do not doubt - if you want to live better? The answer is obvious!
Earn in the stock market is not coming to PC? Maybe!
It is not.
