Learn How To Read Forex Charts
If you look on different web sites on the internet for Forex information you will find that one of the main features of Forex will continue to show up in searches, and that will be "learn the basics". This includes knowing how the system works, and reading the Forex charts.
If you don't have any basic knowledge of the system you will have a tough time, especially with reading the Forex charts, as you can make simple errors when reading the charts.
You must learn to read Forex charts as it is vital to your success, and make the Forex system easier for you to understand, which is why I have written this article to teach you how you can read the Forex charts.
5 Steps that will help you read the Forex charts:
1. By buying a currency pair, and looking to profit from it, you will want a strong base currency to strengthen your terms currency which will make your currency chart for the pair go up and make you a profit from the trade.
This also works with selling. If you sell the currency pair you will want the base currency to weaken your terms currency to make your currency chart go down but still make a profit from it
2. Set up your own charts with your own time frame and indicators. The reason for doing this is that other systems will use multiple time frames that determine the trade of the currency pair by using indicators such as momentum.
An example of a system is that it will use large periods of time to see the overall trend whilst it will use short amounts of time to show a small rise.
3. Remember that it is the bid price that is displayed on the chart not the ask price. The price always has a bid and an ask offer which means that if you are going to buy a EURUSD then the bid price may be 1.3055 while the ask price may be 1.3060. Remember that when you buy you have to buy at the higher price which will be the ask price and then when you sell you must sell at the lower which is the bid price.
For example if a chart that you are selling says 1.3055 then that is the price you will get when you sell it, however if you are buying one that has the exact same price then you will pay 1.3060 for it as it is the ask price (the higher of the two).
4. Have a world clock near you. It might sound very random but it is useful because if you take a look at the Forex charts you will notice that the time at the bottom of the charts are set to a particular time zone which are the same as the Forex providers, doesn't sound that random now does it? Another reason you need a world clock is to convert the time for announcements.
Many announcements will take place and without a world clock you won't know when the announcement comes into your time zone.
5. Always check the times on your chart. If you are going to enter or exit a trade and don't want to get stopped before the announcement then you need to be really accurate as traders will perform to the minute after the announcement has taken place. So be quick!
I've just given you 5 tips to read Forex charts that will keep you from making common mistakes when looking at your charts. Keep these 5 points with you when you are looking at Forex charts so you that won't make those silly mistakes.
แสดงบทความที่มีป้ายกำกับ FOREX Charts แสดงบทความทั้งหมด
แสดงบทความที่มีป้ายกำกับ FOREX Charts แสดงบทความทั้งหมด
วันอาทิตย์ที่ 5 เมษายน พ.ศ. 2552
วันพุธที่ 30 มกราคม พ.ศ. 2551
Forex Charts - Avoid This Common Deadly Mistake or Lose
Forex Charts - Avoid This Common Deadly Mistake or Lose
by Monica Hendrix
If there is one basic mistake traders make and continue to make it's the one in this article and if you make it you will simply lose all your money and do it quickly, so here is the forex chart mistake to avoid.
The mistake is the forex prices can be predicted on forex charts.
No they can't...
Of course if you are predicting you are hoping and guessing and that won't get you far in any venture in life, let alone forex trading.
Of course there are many vendors who will tell you prices can be predicted with scientific accuracy and the naïve trader swallows it.
The most popular scientific theories are based around the works of - Gann, Elliot wave and Fibonacci.
These guys never made money with their theories and neither will you - because the fact that markets move at all, proves there is no scientific theory... If there were a scientific theory, we would all know the price in advance and there would be no market - common sense really.
Other forex traders predict but they don't believe in scientific theories - their just trying to buy low and sell high and this doesn't work either.
For example - a trader sees the price dip to just above support, assumes it will hold and executes his trading signal. Of course sometimes it works, most of the time it does not.
Rather than hoping guessing or predicting - you need to get the odds in your favour. Forex trading is a game of odds not certainties but get them on your side and you can make a ton of money.
The Way To Win With Forex Charts
Lets say you see prices dip to support you don't buy you wait for momentum to turn up (you can read about momentum oscillators in our other articles) this gives you advance warning of a shift in price velocity and shows the level is likely to hold.
You can also use momentum to follow a break of support and trading breakouts is very profitable.
It's a fact that most big bullish or bearish moves start from new market lows or new highs and by following the breaks with momentum on your side you can catch the biggest trends.
So remember:
The next time you see someone say they can predict market tops or bottoms with 90% market accuracy - you know their lying and that if you try and predict with your forex charts, you simply lose all your money and do it quickly.
Use your forex charts correctly. Trade the odds, confirm each move with momentum and enjoy long term currency trading success.
by Monica Hendrix
If there is one basic mistake traders make and continue to make it's the one in this article and if you make it you will simply lose all your money and do it quickly, so here is the forex chart mistake to avoid.
The mistake is the forex prices can be predicted on forex charts.
No they can't...
Of course if you are predicting you are hoping and guessing and that won't get you far in any venture in life, let alone forex trading.
Of course there are many vendors who will tell you prices can be predicted with scientific accuracy and the naïve trader swallows it.
The most popular scientific theories are based around the works of - Gann, Elliot wave and Fibonacci.
These guys never made money with their theories and neither will you - because the fact that markets move at all, proves there is no scientific theory... If there were a scientific theory, we would all know the price in advance and there would be no market - common sense really.
Other forex traders predict but they don't believe in scientific theories - their just trying to buy low and sell high and this doesn't work either.
For example - a trader sees the price dip to just above support, assumes it will hold and executes his trading signal. Of course sometimes it works, most of the time it does not.
Rather than hoping guessing or predicting - you need to get the odds in your favour. Forex trading is a game of odds not certainties but get them on your side and you can make a ton of money.
The Way To Win With Forex Charts
Lets say you see prices dip to support you don't buy you wait for momentum to turn up (you can read about momentum oscillators in our other articles) this gives you advance warning of a shift in price velocity and shows the level is likely to hold.
You can also use momentum to follow a break of support and trading breakouts is very profitable.
It's a fact that most big bullish or bearish moves start from new market lows or new highs and by following the breaks with momentum on your side you can catch the biggest trends.
So remember:
The next time you see someone say they can predict market tops or bottoms with 90% market accuracy - you know their lying and that if you try and predict with your forex charts, you simply lose all your money and do it quickly.
Use your forex charts correctly. Trade the odds, confirm each move with momentum and enjoy long term currency trading success.
วันพฤหัสบดีที่ 10 มกราคม พ.ศ. 2551
Forex Charts the Basics You Need To Know
Forex Charts the Basics You Need To Know
by monica hendrix
Here we are going to give you an introduction to the basics of forex charting and how to use them to successfully catch and hold forex trends for big profits.
Forex markets (or any financial market for that matter) move to this basic equation:
Fundamentals + Investors Perception of them = Market price
The fundamentals are the supply and demand facts and we all see them but being humans we all draw our own subjective judgements on what they mean and we are not just influenced by logic - but the emotions of greed and fear as well.
It's very difficult to trade the fundamentals, because all the facts are instantly known and discounted in the price and of course you never quite know how humans are going to view them.
A basic premise of using forex charts is to simply assume that all fundamentals are instantly discounted in the price and no study of them is needed - while this sounds essentially simple (and it is), it means a chartist is not interested in knowing them - he is only interested in price movement generated by them and investor psychology.
How and where prices move is decided not by the facts or supply and demand situation but is down to how investors as a whole see them, this then becomes the market price.
A basic foundation of forex technical analysis is that history repeats.
Why?
Because human nature is constant it will be reflected in forex charts as repetitive price patterns that can be traded for profit.
In essence forex charts allow us to study the fundamentals and investor psychology all at once - a technical analyst is not interested in how or why prices move - he just studies the charts and wants to make money when they do.
Another foundation of technical analysis is that a trend in motion is likely to persist and the aim is to lock into these trends and hold them for profit.
The fact is anyone with the right forex education can make money using forex charts but it's an art not a science and you need to learn a method based upon sound logic.
Many forex traders base their currency trading systems on trying to predict forex prices but this is wrong.
Why?
Because it's simply another word for hoping and guessing and that won't get you far in any walk of life and that includes forex trading.
Forex charting is a game of odds - not certainties and you need to keep this in mind while chart patterns do repeat they do not move to a scientific theory.
If you want to learn currency trading and be successful then charting is a quick simple and profitable method and takes very little time. You can learn it in a few weeks and you can then cover your currencies daily in around 30 minutes and that's it.
Forex charting basics are enclosed but you will now say - I like the idea how do I use them for profit? That is the subject of part 2 of this article series.
by monica hendrix
Here we are going to give you an introduction to the basics of forex charting and how to use them to successfully catch and hold forex trends for big profits.
Forex markets (or any financial market for that matter) move to this basic equation:
Fundamentals + Investors Perception of them = Market price
The fundamentals are the supply and demand facts and we all see them but being humans we all draw our own subjective judgements on what they mean and we are not just influenced by logic - but the emotions of greed and fear as well.
It's very difficult to trade the fundamentals, because all the facts are instantly known and discounted in the price and of course you never quite know how humans are going to view them.
A basic premise of using forex charts is to simply assume that all fundamentals are instantly discounted in the price and no study of them is needed - while this sounds essentially simple (and it is), it means a chartist is not interested in knowing them - he is only interested in price movement generated by them and investor psychology.
How and where prices move is decided not by the facts or supply and demand situation but is down to how investors as a whole see them, this then becomes the market price.
A basic foundation of forex technical analysis is that history repeats.
Why?
Because human nature is constant it will be reflected in forex charts as repetitive price patterns that can be traded for profit.
In essence forex charts allow us to study the fundamentals and investor psychology all at once - a technical analyst is not interested in how or why prices move - he just studies the charts and wants to make money when they do.
Another foundation of technical analysis is that a trend in motion is likely to persist and the aim is to lock into these trends and hold them for profit.
The fact is anyone with the right forex education can make money using forex charts but it's an art not a science and you need to learn a method based upon sound logic.
Many forex traders base their currency trading systems on trying to predict forex prices but this is wrong.
Why?
Because it's simply another word for hoping and guessing and that won't get you far in any walk of life and that includes forex trading.
Forex charting is a game of odds - not certainties and you need to keep this in mind while chart patterns do repeat they do not move to a scientific theory.
If you want to learn currency trading and be successful then charting is a quick simple and profitable method and takes very little time. You can learn it in a few weeks and you can then cover your currencies daily in around 30 minutes and that's it.
Forex charting basics are enclosed but you will now say - I like the idea how do I use them for profit? That is the subject of part 2 of this article series.
วันอาทิตย์ที่ 6 มกราคม พ.ศ. 2551
Create Your Own FOREX Trading System In 5 Easy Steps
Create Your Own FOREX Trading System In 5 Easy Steps
by Yusoff Allian
A quick search on your favorite internet search engine for the phrase "FOREX trading system" will yield thousands of results, all of which will try to convince you that theirs is the only sure-fire profit making system available. The truth of the matter is that yes, some or most can make you money, but you don't need to pay someone else to teach you something that's really pretty simple to create for yourself. At its core your FOREX trading system needs to be able to spot trends early and also be able to avoid sharp rises or falls due to a particularly volatile market. At first glance this may seem like a difficult thing to accomplish and to be honest no FOREX trading system will perform both functions flawlessly 100% of the time. However, what we can do is design a trading system that works for the vast majority of the time - this is what we'll focus on when designing our own FOREX trading system. So, what elements do we need to consider for our custom system? The most important criteria are as follows:
1. What kind of trader are you? Do you like to follow long trends, or are you glued to your charts for 8 hours straight per day? If you're new to FOREX trading it's suggested that you stick to long term trading as it's far easier to spot trends and cut your losses when compared to day trading.
2. Find an indicator you're comfortable with. Knowing when to buy is key to generating big profits, so it's important to understand some of the key indicators and how they can identify trends. Moving averages are probably the easiest indicators to work with and can be very useful in recognizing emerging trends. A common tactic is to use two moving averages, one slow and one fast, and wait for the fast average to pass above or below the slow average. This is commonly known as the moving average crossover technique. As with everything else in our FOREX trading system it's simple, easy to understand, and effective.
3. Risk Management. Successful FOREX traders understand that you *will* lose money at some point or another, no matter how effective your FOREX trading system is. You will always want to use a stop-loss on all your trades, but the amount risked will vary from person to person based on their experience and available capital. Knowing where to set your stop loss can be tricky - you want to limit how much you could possibly lose so you'd be tempted to set a very small range, but at the same time you want to allow for short term rises and falls so that you don't exit your position too early.
4. Know when to get out. Knowing when to exit a trade can be just as tricky as knowing when to enter, but for your custom FOREX trading system you want to pick one way that you're comfortable with and just stick with it. One simple technique is called the 'trailing stop' technique, and all this entails is updating your stop loss as your position increases in value. Another popular method used in many FOREX trading systems is to set a target and get out when that target is reached. This can be based on support or resistance, or simply based on a certain number of pips. Find a method you're comfortable with and stick with it.
5. Test your FOREX trading system. So you now have a trading system that tells you when to enter and exit a trade, so see how it performs using real data. Find historical data for a currency you've thought about trading, and analyze the charts. Apply your FOREX trading system to the data you see in the charts and write down the results. Was the system effective? Would you have turned a profit or a loss? Try your trading system on several different charts and record the results. If you've got a winning system then it's time to move onto live data via a demo account. Practice makes perfect and you don't want to risk real money until you're confident your FOREX trading system can provide you with decent profits over time.
by Yusoff Allian
A quick search on your favorite internet search engine for the phrase "FOREX trading system" will yield thousands of results, all of which will try to convince you that theirs is the only sure-fire profit making system available. The truth of the matter is that yes, some or most can make you money, but you don't need to pay someone else to teach you something that's really pretty simple to create for yourself. At its core your FOREX trading system needs to be able to spot trends early and also be able to avoid sharp rises or falls due to a particularly volatile market. At first glance this may seem like a difficult thing to accomplish and to be honest no FOREX trading system will perform both functions flawlessly 100% of the time. However, what we can do is design a trading system that works for the vast majority of the time - this is what we'll focus on when designing our own FOREX trading system. So, what elements do we need to consider for our custom system? The most important criteria are as follows:
1. What kind of trader are you? Do you like to follow long trends, or are you glued to your charts for 8 hours straight per day? If you're new to FOREX trading it's suggested that you stick to long term trading as it's far easier to spot trends and cut your losses when compared to day trading.
2. Find an indicator you're comfortable with. Knowing when to buy is key to generating big profits, so it's important to understand some of the key indicators and how they can identify trends. Moving averages are probably the easiest indicators to work with and can be very useful in recognizing emerging trends. A common tactic is to use two moving averages, one slow and one fast, and wait for the fast average to pass above or below the slow average. This is commonly known as the moving average crossover technique. As with everything else in our FOREX trading system it's simple, easy to understand, and effective.
3. Risk Management. Successful FOREX traders understand that you *will* lose money at some point or another, no matter how effective your FOREX trading system is. You will always want to use a stop-loss on all your trades, but the amount risked will vary from person to person based on their experience and available capital. Knowing where to set your stop loss can be tricky - you want to limit how much you could possibly lose so you'd be tempted to set a very small range, but at the same time you want to allow for short term rises and falls so that you don't exit your position too early.
4. Know when to get out. Knowing when to exit a trade can be just as tricky as knowing when to enter, but for your custom FOREX trading system you want to pick one way that you're comfortable with and just stick with it. One simple technique is called the 'trailing stop' technique, and all this entails is updating your stop loss as your position increases in value. Another popular method used in many FOREX trading systems is to set a target and get out when that target is reached. This can be based on support or resistance, or simply based on a certain number of pips. Find a method you're comfortable with and stick with it.
5. Test your FOREX trading system. So you now have a trading system that tells you when to enter and exit a trade, so see how it performs using real data. Find historical data for a currency you've thought about trading, and analyze the charts. Apply your FOREX trading system to the data you see in the charts and write down the results. Was the system effective? Would you have turned a profit or a loss? Try your trading system on several different charts and record the results. If you've got a winning system then it's time to move onto live data via a demo account. Practice makes perfect and you don't want to risk real money until you're confident your FOREX trading system can provide you with decent profits over time.
The 3 Most Profitable FOREX Charts
The 3 Most Profitable FOREX Charts
by Yusoff Allian
A basic understanding of technical analysis can propel the novice FOREX trader from a micro account to the big leagues in record time, and it really isn't that difficult to master once you comprehend the basics. At first glance all these charts and acronyms can seem daunting and can quickly scare the average novice trader away, but it's really not as complicated as it looks. Let's take a look at the three most popular FOREX charts out there right now.
The Line Chart.
This is the kind of chart that even non-traders are familiar with. It plots closing prices from one day to the next and connects the two points with a line, forming a jagged line with peaks and valleys from left to right. The general trend of a currency pair is very easy to identify as the price will either trend up, down, or remain relatively stagnant.
The Bar Chart.
The bar chart is a glorified line chart that not only shows the closing price, but also shows the opening price that day and also the high and low that the currency pair reached that day. Picture a vertical line, with the top point of the line representing the high price traded that day, and the bottom of the line indicating the low price traded that day. Each vertical line also has a horizontal line on the left side that indicates the opening price that day, and a horizontal line on the right side that represents the closing price that day. This FOREX chart is particularly useful as it's easy to identify the long term trend of a currency pair while also seeing what kind of daily variation it typically experiences.
You'll often see bar charts referred to as "OHLC" charts - Open, High, Low, and Close, for the reasons explained above.
The Candlestick Chart.
Candlestick charts are probably the most popular type of FOREX chart used by professional FOREX traders. It combines the best elements of the line chart and bar chart and adds its own unique twist. A candlestick has a vertical line, just like the bar chart, but instead of having horizontal lines on either side that represent the open and close prices it has a rectangular box in the middle of the vertical line. The inside of this box is typically white if the price closed higher than it opened, and black if the price closed lower than it opened, although you'll see various color schemes used from site to site.
Candlestick charts don't contain any extra information than a bar chart, but visually they're much easier to understand at a quick glance. You'll find that you'll be able to identify trends much quicker and recognize market reversals much easier than if you were using a bar chart.
As candlestick charts tend to be the most popular of the FOREX charts you'll find that there tends to be a lot more information available online about them, including information on candlestick patterns. These patterns have been tweaked many times over and are very handy in identifying emerging trends in a currency or stock, and it's highly recommended that you familiarize yourself with some of the more well known candlestick patterns if you want to realize some serious profits in FOREX trading.
by Yusoff Allian
A basic understanding of technical analysis can propel the novice FOREX trader from a micro account to the big leagues in record time, and it really isn't that difficult to master once you comprehend the basics. At first glance all these charts and acronyms can seem daunting and can quickly scare the average novice trader away, but it's really not as complicated as it looks. Let's take a look at the three most popular FOREX charts out there right now.
The Line Chart.
This is the kind of chart that even non-traders are familiar with. It plots closing prices from one day to the next and connects the two points with a line, forming a jagged line with peaks and valleys from left to right. The general trend of a currency pair is very easy to identify as the price will either trend up, down, or remain relatively stagnant.
The Bar Chart.
The bar chart is a glorified line chart that not only shows the closing price, but also shows the opening price that day and also the high and low that the currency pair reached that day. Picture a vertical line, with the top point of the line representing the high price traded that day, and the bottom of the line indicating the low price traded that day. Each vertical line also has a horizontal line on the left side that indicates the opening price that day, and a horizontal line on the right side that represents the closing price that day. This FOREX chart is particularly useful as it's easy to identify the long term trend of a currency pair while also seeing what kind of daily variation it typically experiences.
You'll often see bar charts referred to as "OHLC" charts - Open, High, Low, and Close, for the reasons explained above.
The Candlestick Chart.
Candlestick charts are probably the most popular type of FOREX chart used by professional FOREX traders. It combines the best elements of the line chart and bar chart and adds its own unique twist. A candlestick has a vertical line, just like the bar chart, but instead of having horizontal lines on either side that represent the open and close prices it has a rectangular box in the middle of the vertical line. The inside of this box is typically white if the price closed higher than it opened, and black if the price closed lower than it opened, although you'll see various color schemes used from site to site.
Candlestick charts don't contain any extra information than a bar chart, but visually they're much easier to understand at a quick glance. You'll find that you'll be able to identify trends much quicker and recognize market reversals much easier than if you were using a bar chart.
As candlestick charts tend to be the most popular of the FOREX charts you'll find that there tends to be a lot more information available online about them, including information on candlestick patterns. These patterns have been tweaked many times over and are very handy in identifying emerging trends in a currency or stock, and it's highly recommended that you familiarize yourself with some of the more well known candlestick patterns if you want to realize some serious profits in FOREX trading.
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