Prior to scheduled news announcements such as retail sales numbers for a particular country, Dustin Pass and his team “feed” Oracle Trader with all of the predictions being made about the upcoming news (at considerable expense).

The market of course factors in the predictions of experts into the forex valuation of the country’s currency. This means that prior to the actual announcement, Oracle Trader is fully aware of what has been predicted for the announcement and how it is affecting the currency valuation.

Then, at the precise time that the actual announcement occurs, the actual data from the announcement is fed into Oracle Trader software.

Whether the data is better or worse than what was predicted, Oracle Trader is able to decide instantly in what direction a particular forex currency pair will move as a result of the news, such as the currency pair of the country who just released their retail sales numbers against the USD for instance.

Oracle Trader can then submit a forex trade on your behalf instantly, and analyze those critical 60 seconds after the news is released to sell part of your position as you begin to make money and ultimately when to exit the entire position.

The one unfortunate aspect of Oracle Trader however is that it is not available to buy all the time. They only open the doors to new customers at certain times.

If Oracle Trader happens to be available at the moment you are reading this review, then you really need to review the videos on their site as soon as possible and decide one way or the other if the Oracle Trader software is right for you and your style of forex trading. If you leave it for a few weeks and come back then chances are you will miss out on the Oracle Trader opportunity.

Now what about an Oracle Trader bonus? Our take on bonuses when it comes to an all-encompassing system like Oracle Trader is that they tend to be a distraction, and take your focus away from the type of trading being presented along with the Oracle Trader software. However, we do offer a couple of excellent free bonuses below that you can get right now to get you started with forex trading.

You can get our free Oracle Trader bonus right now by signing up for our Free Mini Course at the left side of this page, then download the free Forex book by following the instructions in the first email you receive on Day 1 of the Mini Course. You can also get some additional free introductory material here.

Click here to review more details on Oracle Trader, and to see if it is currently available for sale (if it isn’t you should still be able to add your name to a list to be notified if the Oracle Trader software ever comes up for sale again), or watch the video that shows how it works…
See also: Elemental Trader
Portfolio Prophet

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Before you buy, you can get a password to their live Leo Trader Pro brokerage account so that you can review their results over the previous 5 months of trading with the LeoTrader Pro automated forex trading robot.

They plan to provide a video of the CEO of the brokerage where they trade their Leo Trader Pro account verifying that the numbers you see in the password protected account area are valid real money trading results. You should be able to see this video here after they go live to begin selling Leo Trader Pro v2.0 to the general public sometime in April or May 2011.

Other videos that they are planning to host on their site for a time are of their booth at the The International Traders Expo™ where they are inviting real traders to come into their booth and experience what Leo Trader Pro has to offer.

It is actually quite refreshing to see a forex robot being exposed “in the real world to real people” like this, rather than hiding behind a website as so many of the forex robot companies do.

Now what about a Leo Trader Pro bonus? Well, here on this site we like to advocate understanding the basics of forex trading rather than relying too heavily on a forex robot.

Therefore, if you are new to forex trading, then a useful bonus would be introductory material to get you primed to better understand how Leo Trader Pro and indeed any forex trading system actually operates.

For that you don’t have to wait until Leo Trader Pro 2.0 becomes available (sometime in April or May 2011 from what we understand), you can get it now by signing up for our Free Mini Course and Forex book (download) at the left side of this page.

Consider these your primer bonuses available right now, which you can download and review for free in advance of purchasing the Leo Trader Pro 2 when it becomes available in April or May 2011.

Whatever you decide, we wish you the greatest success with your Forex Trading career!

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The Disciplined Trader Training and Support Program (sometimes referred to as The Disciplined Trader Intensive Program) demonstrates very clearly what is needed to succeed in trading long term, whether you are trading the forex, stocks, bonds, or options.

Regardless of what you are trading, you need more than just a sound technical trading plan. You need the emotional tools and mental toughness to battle the two greatest enemies facing any trader: greed and fear.

The Disciplined Trader Intensive Program does battle with these two enemies head-on. With many years of trading ups and downs under his belt, Norman Hallett is the ideal teacher on this subject.

Of course one of the questions that always comes up on the internet when a new course is released is whether or not it is a scam. The Disciplined Trader Course is no scam, it is extremely high quality training offered by a guy who has seen and done it all when it comes to trading online.

Now what about a Disciplined Trader Intensive Program bonus? Our take on bonuses when it comes to an all-encompassing course like The Disciplined Trader Training and Support Program is that they tend to be a distraction, and take your focus away from what is being taught in the course.

Having said that we do offer a couple of excellent free bonuses below that you can get immediately, even if the Disciplined Trader Intensive Program happens to be closed off to new students when you are reading this.

However, we would recommend focusing exclusively on The Disciplined Trader Training course for the duration of the course if you are lucky enough to get in.

If you are new to forex trading, then the one type of bonus that may be useful would be basic introductory material to go along with the Disciplined Trader Intensive Program course.

You can get that right now by signing up for our Free Mini Course and Forex book (download) at the left side of this page.

If you want to review some additional free introductory material from legendary forex trainer Bill Poulos, you can find some here.

If you happen to be reading this after the doors to the Disciplined Trader Intensive Program course are closed, then these free resources will be invaluable to you in terms of getting a good start and pointed in the right direction.

Just keep in mind that there is a time factor with The Disciplined Trader Training and Support Program.

Once Norman takes on new students, he shuts the doors for the entire time that he is teaching those new students.

This “closing of the doors” is not a marketing gimmick, it is just the nature of providing a professional quality personalized trading education such as The Disciplined Trader Training and Support Program.

Whatever you decide, we wish you the greatest success with your Trading career!

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In Winning The Inner Game Of Money Mr. Assaraf takes things well beyond the “Law of Attraction” as was so well described in The Secret, and reveals how to take advantage of the latest in brain research to “re-program” your mind for success in the area of money.

Whether your means to achieving that success is foreign exchange currency trading, as is mainly discussed here on this website, or some other method, Winning The Inner Game Of Money by John Assaraf contains critical steps to your success.

The key to Winning The Inner Game Of Money is the use of newly developed “neuro re-conditioning” techniques designed to alter your subconscious beliefs and habits which in turn affects your thinking and feelings about success and money.

It is your thinking and feelings that ultimately lead to your results, but you can’t change your thinking by thinking about it! You need to go deeper into your sub-conscious beliefs and habits to make real changes that will lead to more successful outcomes.

In Winning The Inner Game Of Money John Assaraf uses neuro re-conditioning techniques to get you to start believing differently which in turn leads to thinking differently and achieving better outcomes when it comes to money.

These are very specific exercises (actually he calls them “innercises” as they are changing your inner belief system around money) that are specific to the Winning The Inner Game Of Money program.

As a bonus for visiting our site, and as one example of how to put Winning The Inner Game of Money into practical action, signup for our free Forex (Foreign Exchange Currency Trading) mini course at the left side of this page.

Click Here to review more information related to Winning The Inner Game Of Money by John Assaraf.

In fact Forex Profit Multiplier contains in depth material on just about every aspect of Forex Trading that Bill’s former customers have asked for over the past 10 years.

Forex Profit Multiplier is the grand-daddy of Forex Courses that condenses Bill Poulos’s decades of trading experience into easy to understand modules.

Of course one of the questions that always comes up on the internet when a new course is released is whether or not it is a scam. Forex Profit Multiplier is no scam, it is extremely high quality Forex training offered by a guy who has seen and done it all in the forex world.

Just take a look at everything that is offered in the ForexProfitMultiplier home study course in the Product Specifications section below. As you can see this is no lightweight course.

Forex Profit Mulitplier leaves no stone uncovered, and comes with a number of valuable services in addition to the home study course that are probably worth the price of admission all on their own.

Now what about a Forex Profit Multiplier bonus? Our take on bonuses when it comes to an all-encompassing course like the Forex Profit Multiplier is that they tend to be a distraction, and take your focus away from what is being taught in the course (although we do offer a couple of excellent free bonuses below that you can get right now, before Forex Profit Multiplier is available again sometime in March 2012).

When it comes to successful Forex trading, it is all about finding a solid trading system, such as the Forex Profit Multiplier, and following it to a tee day in and day out.

This is the only way to get a true statistical advantage when it comes to trading the Forex, the only way to truly stack the odds in your favor.

So our advice is to forget about bonuses and simply concentrate on what Bill is trying to teach you in the Forex Profit Multiplier home study course.

When you find a system that stacks the odds in your favor, deviating from the plan does nothing more than dilute your chances for success.

If you are new to forex trading, then the one type of bonus that may be useful would be basic introductory material to get you primed before beginning the Forex Profit Multiplier home study course.

For that you don’t have to wait until the Forex Profit Multiplier course becomes available (sometime in March 2012 from what we understand), you can get it now by signing up for our Free Mini Course and Forex book (download) at the left side of this page.

If you want to review some additional free introductory material from Bill Poulos himself, you can find some here.

Consider these your primer bonuses available right now, which you can download and review for free in advance of purchasing the Forex Profit Multiplier course in March.

If you happen to be reading this after the doors to the Forex Multiplier home study course are closed, then these free resources will be invaluable to you in terms of getting a good start and pointed in the right direction.

So our advice is review this free introductory material, then come back here to review the Forex Profit Multiplier Product Specifications below when the time comes to truly consider taking that next step in your forex education.

Just keep in mind that there is a time factor with the Forex Profit Multiplier.

Bill only keeps the doors open to his premium courses for a short time, so that he can focus on giving the best possible training and support to the people who come on board during the time when the doors are open.

Whatever you decide, we wish you the greatest success with your Forex Trading career!

See also: Elemental Trader
Portfolio Prophet

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- the system chosen by the trader is inherently defective and cannot generate profits
- lack of discipline in applying the system
- allowing trades to be influenced by emotion
- the trader simply made mistakes

Whatever the cause of the losses, reducing losses and maximizing profits can be yours with proper education and experience. Creating a definite and detailed FX online trading plan coupled with proper implementation can salvage seemingly terminal scenarios regardless of the system being used.

Your Plan

A market tested profit generating system and an efficient plan are two components for success in FX online trading. The trading systems on the market are much too numerous to enumerate here so our presumption will be that you have in fact, acquired your own system. The deficiencies begin when people presume that having a system is all they need. Well, in time they will realize that it certainly is not. The choice of system is definitely important but equally important is having a plan whose objective is the proper and effective implementation of the system chosen.

This plan must contain these three elements:

- the position size which is defined as the amount invested in every trade. While this would be defined in terms of lots, it is worthwhile to take into consideration the magnitude of the margin as well as what percentage it is of your total funds. Leverage available to you and the acceptable risk level involved are the determinants of the percentage amount.

- your stop loss level. This is defined in terms of pips but like position size, it’s better to analyze it as a percentage of your trading funds. As a general rule, traders should set up stop losses in manner in which they will not risk more than 2% of their total funds on just one trade. This may be adjusted based on your account balance. In cases where you have a minimal amount of funds, it may be necessary to take on more risk. This is because small normal market fluctuations will trigger stop losses every now and then. Ensure though that you keep foremost in your mind the fact that you are taking on a larger risk.

- exit levels for successful trades. Most traders do not plan this ahead of time but in reality, it should be done. For majority of market situations, profit maximization is facilitated by a preset profit exit amount. Resist the temptation to ride the trend to the end in the hope it will just continue and generate more profit for you. Eventually market conditions will change and when they do they may affect you severely.

Stick To Your Plan

What is the point of making a FX online trading plan if you won’t follow it anyway? The dissenting voices will always be there, urging you to waver from your plan, showing a large number of alternatives.

One temptation just mentioned was that of riding a positive trend indefinitely. This is just one of many temptations you will encounter. Another one occurs after a loss, where you are tempted to risk a larger amount than planned hoping it will create profit to compensate for the loss. Do not give in.

Another scenario is when your trading volume has been non-existent because there are no trades that conform to your trading criteria. One day, you are presented with a situation that just misses being traded by your system. You are tempted to give a little bit to accommodate this trade. Should you do it? Most certainly not. This is the essence of discipline, being able to say no.

It is also important to maintain focus by avoiding distractions in the course of your trading day to ensure that the chances of making mistakes is reduced if not eliminated. Mistakes can be unbelievable like going long when you intended to go short. Or maybe entering the market using the wrong pair and even setting stop losses at a level 10 times more than you had planned. Simple errors bordering on sheer stupidity but most traders will own up to making at least one such error once in their life. Domestic distractions are responsible for a good number of them. Doorbell ringing or maybe kids crying and your impulse is to place the trade immediately so you can address the distractions.

This is where the use of forex robots become a great advantage, no matter what the external elements are, the robot will implement the trading plan. As long as your robot can be setup as part of a profitable system, it will just go on trading automatically. By utilizing robots for your trades, you are able to insulate yourself from the dangers of temptation and distraction which can severely impact your fx online trading.

The traditional role of a broker before was to service the client by buying and selling for them via their dealing desks. For stock exchange trading, they would receive compensation via a commission charged on transactions. In the case of fx trading, they would make their profits via the difference between bid and ask prices or what is known as the spread. In the past, orders were placed through the phone which is in stark contrast to trading today which is done online with the trader having complete control of their account.

However, opening standard forex accounts required a large investment with minimums ranging from $10,000 all the way to $50,000 rendering it beyond the reach of individual investors. Today however, there a good number of companies offering lower minimum deposit requirements for forex mini accounts and allowing you to trade from your home. The business models of these companies are quite different from the traditional broker and you must be aware of them as they may have an impact on your investments.

Nowadays, there are a wide variety of companies that offer their services to the individual investor. Most of them don’t have their own dealing desks and operate in very different ways.

Forex NDD (No Dealing Desk)

These are the forex trading brokers who don’t have their own dealing desks. They utilize external liquidity providers to give prices and to match the trades of their clients. The true spread is usually small due to the liquidity providers range though the brokers sometimes opt to increase spreads to create a more optimal profit for themselves.

Forex ECN (Electronic Communications Network)

FX electronic communications network brokers offer a venue for market users such as market makers, banks and regular traders to have trades filled. For the sake of anonymity, trades are entered under the ECN providers name. While the spread is usually small, they generally charge matching fees for each trade.

Forex Market Makers

When a forex market maker is handling your account, the trades are not matched externally but internally by the market maker. What this means is that the market maker will occupy the opposite position in your trade and offer their price to their client, namely you. These prices correspond to the prevailing current market prices. To offset the risk of their position, they then take an equivalent position to yours with ECN or other venues.

In this case, the market makers are not true brokers since they don’t actually place your order in the marketplace. However a lot of traders define fx brokers with some ambiguity and consider market makers as fx brokers as well. Furthermore, some traders cannot see much difference between the market makers and bucket shops and would rather choose to steer clear of them.

Forex Bucket Shops

Bucket shops and market makers work a bit like each other. But bucket shops dispense with offsetting risk and have minimal connection to actual foreign exchange spot markets. Consequently, when dealing with bucket shops, you are actually betting against them. So they take an opposing position to your trade and profit when you lose. So in a manner similar to commercial bet takers, these bucket shops dislike it when you make money and would, in all probability, refuse your business, close your account and give back your funds.

They are considered illegal in some locations and even if they are legal in your location, it would be wise to avoid them, particularly if you are a beginner. As you can see, aside from not being true fx brokers, the bucket shops work against you and not for you.

Therefore, there is no single king of the hill solution that must be followed by the traders looking to maximize profits. There are however, a few guidelines that are true for any trader and these can be applied to your trading approach. These are my so called Golden Rules Of Trading.

1. Be A Trend Follower

The objective of most fx trading systems and strategy is the identification of trends. This is because getting in early on the trend is key to this market. Regardless of whether trends indicate a rise or fall in prices, going in long or short, it is important not to buck the trend. Defying the trends will likely result in quick losses for your account.

2. Protect Your Money

Putting all their eggs in one basket has taken down a large number of otherwise promising traders. Regardless of your conviction that this is THE TRADE that will not go wrong, resist the urge to risk large funds on a single transaction. Things can and will go wrong when you least expect them too.

The determination of the amount you can risk is dependent on your trading strategies and how much a total loss will matter to you. But a good rule of the thumb would be to risk no more than 5% of your total balance. A more conservative trader may opt for 2% to play it safe.

This percentage is maintained by many traders even as their funds increase. In this case, they are actually risking more money per trade because the actual monetary base is larger. It may be wise to reevaluate this because while you have a larger balance in your account, you may be very displeased when a larger loss is incurred due to keeping the percentage constant. If this is the case, it may be prudent to use a percentage reduction so as to risk only the same amount even if your funds are increased.

3. Have Goals For Every Trade

Each trade must have clearly defined profit targets. This means that even before entering the market, you must already know at what level you will close. Avoid overstaying in the market because of greediness.

On the other hand, when the market turns unfavorable for you, avoid keeping a death grip on your trades hoping that it will turn around. It is best to cut your loss and trade another day. A strategy that involves setting stop losses to automate this process is highly recommended.

There you have it. The 3 golden rules of fx trading. Regardless of your trading system, these guidelines will be invaluable in formulating your fx trading strategy.

FX Trading Platforms Designed For Brokers

In this category, a lot of brokers particularly the large organizations, utilize custom made trading platforms. FX trading is big business for these brokers and they will try to gain market share by specifying a platform that will outdo their competitors platform. This however, entails a large cost as well as a long development time. After all, it is the nature of software development to consume more time than was originally allotted. A characteristic it shares with the construction business.

The small brokers however lack the means to have a custom built platform so they usually opt for an out of the box solution. The trading software available in this category though are bound to be familiar to veteran traders who might decide not to deal with the brokers using them. The reason being, that for traders, their confidence is diminished when brokerage companies do not invest their resources in developing their trading software.

But all is not lost as there is a middle of the road solution which is quite feasible for lots of brokers. This involves taking a packaged trading platform and having it customized to give it a unique, custom made look. This could involve aesthetic changes like including company logos, using the company colors and other cosmetic factors. Others will take it a good step further by providing technical analysis stuff that are always useful for traders but hard to get out there. This provides the brokers platform with an air of uniqueness minus the full custom costs.

FX Platforms Designed for Traders

Majority of the single or private traders will just use the software provided by their broker. Therefore, the type of platform becomes one of their prime considerations when selecting brokers. In some cases, this may even carry more weight than the costs of trading with that broker. Larger spreads are accepted as a trade off for better technical analysis tools and information since they believe it may add up to better profits in the long run.

Moreover, there are traders with more specialized requirements. These are the traders who utilize forex robots or automated trading systems which require a software platform compatible with the robot. In fact, some veteran traders with their own profitable personal system, opt to design their own robot to automate their trades. The majority of robots and expert advisor systems use the Metatrader 4 platform so this free download may be needed to utilize most of the robots available on the market.

The use of forex robots has a lot of benefits for the user. Foremost among them is being able to close and open trades automatically when market conditions are favorable for your trading system. Consequently, a large number of traders are now using robots and for them, the Metatrader 4 should be the platform of choice.

As in many things in this world, hindsight gives us 20/20 vision of trends by way of charts. While the currency trends are most apparent in candlestick charts, this information can be seen on other kinds of charts as well.

During a period when prices are on the rise, drawing a line above the low points of candlestick shadows will give the uptrend slope. On the other hand, the downtrend slope can be seen by drawing a line above the high points of the candlestick shadows during a point when prices are going down.

Sometimes, a sideways currency trends exist wherein prices fluctuate up and down in between two points without going through them. At this point, should lines be drawn above and below the shadows, they would be horizontal.

In such cases with a horizontal line, it can be expected that in time, the price will break in either direction. To get on this breakout, traders would enter orders to place trades once the price moves to certain points above or below the horizontal line.

Then there are those traders who utilize the sideways currency trend to identify changes in general price movement. For instance, when the sideways pattern is a generally regular movement going up, this could mean there is resistance to prices going any higher. In this case, the upper line can be considered the resistance line after which a price movement going down would result in prices returning to the trading band acceptable to the market.

You are however, well advised to test these methods prior to integrating them into your system. Using backtests could be of assistance so you could establish if this system is worth pursuing. Then if you feel it is, employ demo accounts and do live market tests before risking real money in the system. Keep in mind the volatility and risks involved in forex trading. Even the very best systems will fail or even encounter a series of losses or a losing run.

Draw trend lines correctly and you can use them as a predictor of breakouts and large price movements. Done this way, they can be as accurate as the other methods available. Be mindful though to maintain your objectivity particularly when evaluating markets in real time.

The reason is that during a time when we are on the lookout for preset conditions that will signal that an order should be placed, it is all too easy to act prematurely. Subjectively, we decide that a trend or pattern has formed when the truth is that it’s still too early in the game to tell. Be aware of this tendency when drawing the lines on the charts to indicate trends. It may lead you to draw what you want to see rather than the real picture.

1. Employ weekly and daily charts

Using a weekly chart to survey the movements of your currency pair of choice, can give a clearer view of long term and short term market trends. Spot forex trading can sometimes put blinders on your perspective particularly in cases where day trades are the focal point of your methods. By using weekly charts, you are able to take a step back and view the market from a different angle.

Often this novel view of things can help you ascertain the right and wrong moves in your trades as well as the reasons behind them. This knowledge can then be used to gain more profit via fine tuning your system. One caveat is that you must not change a known excellent system each and every time a bad trade occurs. An equilibrium between discipline and fine tuning must be found.

2. Avoid excessive trading

Resist the urge to run after every trading opportunity. There are times when holding back is the better alternative. Oftentimes, the trader with less trades makes more profit. It does run contrary to the belief that substantial profits can only be achieved through a large number of trades. However, ill timed trades will lead to loss thus lending credence to the “less is more” theory.

Being able to live with risks is a necessary trait for forex traders. Some traders actually find themselves enjoying the risks involved. However, this can make it harder to control oneself when faced with what appears to be a chance for a great trade. Investing is not synonymous with gambling and trades must be chosen with care. Throwing caution to the winds while in pursuit of a potentially humongous profit is likely to lead to a potentially disastrous hit to your account.

Some excellent trading systems trade less than others at certain times so less profit is made during this period. When this happens, resist the urge to modify the criteria, widening it so that more trades are made. Making such modifications will almost guarantee that your system, which was making profits before, will now be accumulating losses for you.

When faced with this, two options are available to you. One involves increasing the dollar amount of the individual trades. However, this obviously increases the risks and is not recommended unless you have great confidence in your system. The other option is to look for another system that has the same profit potential as the first. Once you find one, use them simultaneously so as to increase your profit potential. For majority of the traders, the second option is the preferred one though it must be stressed that prior to using the new system it must be evaluated and studied well.

3. Avoid setting unrealistic goals

When trading forex, avoid keeping yourself focused exclusively on the potential profits. All large potential profits carry with them the risks of large potential losses as well. Losing money in forex trading is a reality that you must accept and be prepared for. Therefore be sure that you trade only with your disposable income, not the kids college fund etc. And don’t think that your profit will increase exponentially at a rapid pace.

However there are a large number of forex ads that encourage unrealistic expectations. Some even offer to double your investment in a week. The truth is, there is no certainty that you will double your money. And there most certainly is no guarantee that this will happen once every 7 days with no losses. While making double your money in a short time period may be possible, repeating it continuously without encountering any loss is an expectation that is out of touch with reality. It’s prudent to assume that for every two steps forward, you will take a step backward. Evaluating potential gains in other markets like stocks and bonds can assist you in setting realistic targets for your forex investment.

Lastly, before embarking on trading forex with real money, arm yourself with methods and techniques, which you thoroughly tested personally. Consider all the choices available and keep in mind that you will be encountering a lot of risks. Ensure that you give yourself the best shot at forex trading success by keeping these trading tips foremost in your mind.

A trader who keeps on switching systems is being instrumental in ensuring that he will not make money on his trades. All of us are lured into doing this at some point in our trading career but we must do our best to resist. However, if resisting becomes too difficult, you may want to try a technique or two below to assist you in your quest to stay true.

1. Your choice of system must be the result of long and exhaustive evaluation by you, the end user. One veteran trader, when asked about his success secrets said, it’s all about thorough researching before deciding on a system, then sticking to your decision like iron. While your choice of system need not be the best, it must be a profitable and track tested one. Each system requires actions from its users during the good and bad periods of trading. Know what is required of you and be sure that it is acceptable to you as well.

2. A lack of self discipline in other non-trading aspects of your life could be utilized as a tool to learn the art of discipline prior to commencing trading with real money. To do this, perhaps its best not to start with the most difficult area that needs discipline. It’s more advisable to begin with easier tasks like sticking to a regular exercise program.

3. Put aside a separate mini account, a kind of budget for fun trades. These are the trades that don’t conform to your trading criteria but are so alluring that you couldn’t bear to let them go past you. Chances are you will eventually lose money trading this way so be realistic and be sure your finances can absorb the losses. If they cannot, then just resist and trade on paper or utilize demo accounts to indulge your urge to trade. When you do trade in this manner, whether with a fun budget or with demo accounts, ensure that the trades are recorded and tracked. It will help in addressing the all too human trait of retaining the memories of the few profitable trades while conveniently forgetting the more numerous disastrous ones.

4. Avoid discussing your trading system and trades with others. Soliciting opinions from online forums prior to choosing your system is ok. However, once you have chosen your system, avoid the “mine is better” discussions with others as they are always counter-productive. People will always think that their choice of system stands head and shoulders above the rest so debating is futile. Family members and friends who are not into trading are likewise bad audiences simply because people react negatively when presented with something that is beyond their understanding.

5. Never drink while trading. Even surveying the markets after downing a few cold ones is not rcommended. Your sense of judgment will be impaired and it is likely to cloud your judgment. Alcohol makes discipline and control difficult particularly when an alluring trade is presented which must be resisted because it does not conform to your own rules.

While trading while lounging around with beer and chips is an appealing vision, the truth of the matter is, indulging in this scenario is incompatible with success in foreign exchange trading. To succeed, your thinking cannot be influenced by alcohol as it will make it difficult, if not impossible to exercise the discipline necessary to stick to your system.

In such scenarios, the forex robots which trade automatically can be your salvation. While you work at developing the trading discipline and skills needed, the forex robot can trade consistently on your behalf. Then when you feel confident about your abilities, you can try your hand at live trading sans the forex robots.

In forex trading, any of the worlds currencies can be used. Real world trading though, confines itself to a subset that includes only the currency of the major financial power players. Note that a nations financial power has no direct bearing on the actual physical size of the nation nor its political power. Switzerland is a good case in point of large power emanating from relatively small land masses. In this case, the power of Switzerland is a direct result of the global significance of their banks.

Six major currency pairs account are involved in 90% of the trading in foreign exchange markets, namely:

- USD/CHF: the US dollar and Swiss franc.

- EUR/USD: the euro and US dollar.

- GBP/USD: the British pound and US dollar. Bit of trivia, the nickname of this pair is “Cable” derived from the fact that an undersea cable in the Atlantic, was utilized for synchronizing them.

- USD/CAD: the US dollar and Canadian dollar.

- USD/JPY: the US dollar and Japanese yen.

- AUD/USD: the Australian dollar and US dollar.

While other currency pairs are used by other traders, some involving the New Zealand dollar, limiting their trading to the major powers shown above is recommended for new traders.

Among the majors, the US dollar stands as the most prolific in light of a 2007 study that showed that 85 percent of the trading done involved the USD. Second place at 37% is the euro and following it in order are the yen, pound, Swiss franc, AUD and CAD. Note that they will never add up to 100% because all the trades involve currency pairs.

So What Currency Pair is Best for Beginners?

The consensus of experts in this matter is the EUR/USD is the currency of choice for beginners because of the voluminouse data available about these currencies. Furthermore, smaller spreads are produced by the high liquidities involved thus trading costs will be relatively low.

Moreover, trading certain currencies require specialized knowledge from those wishing to trade them effectively. Case in point is the Canadian dollar. Since Canada is a significant exporter of oil, the world market price of oil will have a direct bearing on the value of their currency as well. At the other end of the spectrum is the case of Japanese yen which is influenced in a major way by oil prices due to the fact that Japan consumes and imports a lot of oil.

At the start also, it is best to avoid trading with a large variety of currencies. Starting with the EUR/USD first for a couple of months is advisable. After this, the general trend for traders who are just sharpening their skills is to include the GBP/USD currency pair in their trading portfolio.

Practice, practice, practice. You must have a large store of knowledge and strategies at your disposal, but putting these theories into practice is how you will become an effective trader. It is not a good idea to practice with your hard-earned money; beginners often lose more than they gain. A great alternative that will give you the experience you need is to open a free demo account with a broker. This is good practice for Forex brokers because as beginners grow, they tend to start using real money. When this happens, the brokers charge trading fees that will, hopefully, be covered by your gains.

After you have set up your demo account, it is time to put some theories into action. If you know very little about Forex trading, it can be overwhelming because some of the indicators are very complex and meant for serious investors. Is there an easy way to gain entree into the market?

A natural place to begin is a trading strategy known as “support and resistance.” During periods when the market is fluctuating, it is helpful to view it as part of a larger trend. This way, you will see how prices typically behave.

In your Forex demo account, you should have charts and indicators available. Look at the candlestick charts that show movement over several periods. Here you will be able to spot price increases and decreases between different points.

After you have identified the high points, simply draw a line along them. This horizontal line is called the “resistance line,” above which it is unlikely that prices will rise. When your currency’s value hits this line, it typically moves back down. It may be a good time to sell.

The “support line” is a horizontal line along the low points. It marks the point below which prices are unlikely to fall during this trend. When you see prices fall to this line, it may be a good time to buy because they are likely to rise again to stay within the support and resistance boundaries.

Because the market can be unpredictable, this does not always guarantee gains. It is possible to see prices extend under or over the boundaries. This happens when new trends are emerging. This is why demo accounts are so great – you can practice support and resistance strategies, while using indicators to predict breaking trends. When you learn to use them in conjunction, you will be able to make safer and more profitable trades.

Work with your demo account for several months. You will learn to use different trading strategies and gain familiarity with the Forex market. Trading is risky even for veteran investors, but with practice and a conscientious testing of strategies, you can create a profitable trading system.

Oversold markets are those in which stock prices are considered too low. Overbought markets, by contrast, are those in which stocks have a higher price than their actual value. When RSI scores fall below 30, it tells traders that the market is oversold. At the other end of the spectrum, scores above 70 point to a market that is overbought. While many traders use the 30 and 70 markers as signals to buy and sell, others opt for 20 and 80. This is a stronger indication that a reversal or price correction is imminent.

Being able to recognize trends is important in making successful Forex trades, and the RSI can help with this as well. The center line, 50, indicates a stable market. You may be able to spot an uptrend by looking at the RSI score. If it is above 50, it can mean that currently, average gains outweigh average losses. Evidence of a down trend, on the other hand, can come with RSI scores below the center line.

RSI and other indicators are useful only during established trends. Within any given day, there will be price fluctuations which are normal parts of the market. Trends, however, last up to several months and indicate where the market is overall. Those interested in day trading will not find the RSI helpful in closing trades as it is a medium to long-term investing tool.

How does the RSI calculate momentum? When a trader uses an RSI program, it calculates scores by looking at the averages from past periods. Typically, at least 14 periods are used to ensure a balanced overview of the market. There are two different theories on using an RSI and improving its accuracy. If one increases the number of periods beyond 14, the score is more accurate. However, it will be more difficult to spot an emerging trend early. On the other hand, one may use fewer periods to calculate scores and get in on trends sooner. The downside to this is that it is possible to get a less accurate result, which may affect trading.

Momentum oscillators, the RSI in particular, are extremely useful in helping investors spot trends and time trades. Easy to read and often very accurate, the RSI can help maximize profits and minimize gains. It is not, however, foolproof. Traders have to balance the need to get in on trends early with the having the most accurate information. It can easily happen that a trader jumps on a perceived trend that does not materialize. As part of an overall investment strategy and in conjunction with other indicators and charts, though, the RSI is invaluable.