A bilateral trading model with investment is considered. In a "cooperative" investment version of the model, the seller's investment stochastically determines the buyer's valuation of the good. The value and cost of the good are realized only after the investment is made, and the investment level and the realization of the good's value and cost are private information. I show that, under these assumptions, no contract made before the investment can simultaneously induce efficient investment and efficient ex post trade when the buyer's type is continuously distributed. This inefficiency result contrasts sharply with the efficiency result under the standard "selfish" investment model, where the seller's investment stochastically determines the seller's cost.Above is the abstract from an article written by Kazumi Hori (Hitotsubashi University).

Foreign exchange trading is the trading of currencies. Most currencies can be traded. Huge amounts of currencies are traded 24 hours a day, 5 days a week. On average $1.9 trillion is traded a day. The most traded are United States Dollar, Japanese Yen, Euro, Canadian Dollar, British Pound Sterling, Australian Dollar and Swiss Franc.

Many brokers will let you open an account with a starting balance of just $250. Though that may seem small, remember you will be trading on margin. Your $250 investment may let you control $25,000. As with all investments there are risks so make sure you take the time to study the markets and your exposure before making your first trades. I highly recommend that you do some paper trades first to make sure you have understood how the markets work. No risk training, just write down the trades you would have done for real and chart the prices. Buy and sell and see if you have the right strategy before making real trades.

A fast internet connection will allow you to do forex trading online. Your broker will give you many online tools to allow you to study the markets: Real time quotes, news feeds:

Visit different broker's websites and compare the services they offer. Some brokers give you the possibility to open demo accounts. Do so, to test their software and find the one you like best.

Before you start trading make sure that you have learnt the terminology: Market Order, Limit Order, Stop Order. You may find the definitions of these terms and more information at http://www.forex.value-guides.com/calc-forex.html Calculating Forex Profits And Losses.

All currencies have standard identifying code used worldwide, some examples are: EUR (European euros), GBP (United Kingdom pounds), AUD (Australian dollars). Of course you don't have to know them all but it may be good to be able to recognize all the major currencies codes so that you will be able to make quick decisions.

To make sound evaluations, you need information. Follow carefully the world's current events, economic and political news. You will be surprised to see how, what may seem to you as insignificant will cause the currencies markets to fluctuate wildly.

There are many disadvantages to trading independently. Many independent traders cannot command the same low commissions received by exchange members and member firms. Trading on your own may also be isolating. At a firm, you have dedicated support teams handling equipment, software and hardware upgrades, and developing/acquiring new trading tools. That is beyond the budget of many independent traders.

It is natural, therefore, that many independent traders consider joining a trading firm. Having coordinated a training/hiring program for a Chicago-based proprietary trading firm, I have some familiarity with the challenges and issues involved in making such a move. Here are a few items for your consideration:

1) Many of the best career opportunities for traders are at large institutions, such as investment banks and hedge funds. These are often very well capitalized and able to invest in training and development of traders. The catch? These organizations like to hire graduates of finance and financial engineering programs. Quantitative and programming skills are in demand. If you're looking to build a long-term career in the financial world, I'd strongly encourage you to consider an MBA program with a finance concentration or a Master's program in financial engineering to provide yourself with the competencies and skill sets that are increasingly in demand. In such firms, you'll be an employee with benefits and a salary.

2) Can you afford to start out by trading your own capital? If so, this opens several doors. There are trading "arcades" that provide you with office space, tech support, equipment, and trading platforms and pass along economies of scale to you. These shops generally can command low commission rates and may or may not pass along some of their own commissions to you on top of monthly fees for the service, rent, and equipment. Note that in this structure, you are a customer of the firm, not an employee. That means no salary and, in all likelihood, no draw against future earnings. The upside is that you keep the lion's share of your trading profits. One nice variation on the arcade is the trader's co-op, in which a few experienced traders go in together to share equipment, office space, and other overhead, but trade their own accounts.

3) Do you need capital to get yourself started? Then you might be looking at a proprietary trading firm, in which you trade the firm's capital. The firm provides you with all equipment, space, tech support, software, and platforms. At some of these firms, you may be charged a commission on top of monthly fees. The firm, because it takes 100% of risk, will also take a good chunk of profits. You may qualify as an employee of the prop firm, which means that you would be eligible for normal employee benefits. A monthly draw against future profits may provide you with some stable income; straight salaries are not the norm.You'll be more competitive to join a bank or hedge fund if you have the education and internship placement experience.

You'll be more competitive to join a prop firm if you already have an independent track record of trading success. The education departments at the major exchanges, such as the Chicago Mercantile Exchange and the Chicago Board of Trade, publish lists of member firms and often are aware of training programs and hiring among these. Googling "Master's of Science in Financial Engineering" and looking into MBA programs with strong finance components (see who is publishing in the Journal of Finance!) will give you leads for training for institutional positions.The bottom line is that few organizations will take you off the street and put capital into your hands to trade. If you're not an experienced trader with your own capital, my advice is to find a graduate program or a training program within a proprietary firm and learn the business from the ground up. Think about building a career, not just getting a job.This article written by Brett Steenbarger, originally published at http://traderfeed.blogspot.com

What is the Best Time to Trade Forex?

In the 24-hour Forex market, timing is critical. Choosing the best time to trade is a powerful way to maximize the profit potential of every trade. Professional traders know this secret. They carefully choose the timing of their trades to produce the most profits. You can make this same choice — and maximize your profits on every trade. In short, you can choose to trade the Power Hours. Let’s examine what gives the Power Hours their remarkable potency. This can be summarized in two words: volume and volatility.

What Are The Power Hours?The Power Hours are the times when volume and volatility rise to peak levels. High trading volume means that many lots of a particular currency pairs are being bought and sold.Sponsored LinksFree Forex Trend AnalysisAny Forex Pair, Anytime, Anywhere. Get a Free Trend Analysis Everyday.INO.comIndonesia FX Day TradingZero Commissions, Tight Spreads, Instant account opening & fundingwww.avafx.comOnline Derivative TradingBuy and Sell Derivative Options on Forex, Indices and Stock Marketswww.

Bet On Markets. comHigh volatility means that currency pair prices are moving fast and trending quickly.The combined force of high volume and strong volatility can cause large pip movements in nearly every major currency pair during the Power Hours. When Are The Power Hours?The Power Hours run from 8am to 12pm EST.Yes, the most active trading period lasts only four hours every day! This is the US-European overlap session, which is the time when the world’s two most active trading centers cross -- as the European session is closing and the US session is opening. It is a small, but very active, window that some currency traders call the “hot zone.” And many professional traders focus their best efforts on trading during those four powerful hours.

Which Currencies Should I Trade During the Power Hours?Look for the following currencies to make the largest pip movements during the Power Hours.* EUR/USD* USD/CHF* USD/CAD* GBP/JPY* GBP/CHF Are You Busy During The Power Hours?There are other trading times that can produce good results though usually not as dramatic as in the Power Hours. The European and the U.S. sessions can also show strong volume and volatility for trading. Remember, they are the world’s two largest trading centers so the trader can still find good price action.

The European SessionThe European session is headquartered in London. The large number of market participants has made London the world’s most volatile market for trading currencies. And it links with both the Asian and American sessions.Look at the GBP/JPY and the GBP/CHF for strong price movements as European assets are converted into dollar-denominated assets. These conversions can cause the currencies to make strong price movements.Be prepared to get up early (or stay up late) because the European session runs from 2am to 12pm EST. European Session Watch List:* GBP/CHF* GBP/JPY* USD/CHF* GBP/USD* USD/CAD The US SessionThe US session is headquartered in New York. The GBP/JPY and USD/CHF show high volume and volatility during this time since their transactions require US dollars. Trading during this session becomes even more active when the US stock and bond markets open because foreign investors need to convert their currencies into dollar-dominated assets. The GBP/CHF often makes strong price movements during this period.The US session runs from 8am to 5pm EST.US Session Watch List:* GBP/CHF* GBP/JPY* USD/CHF* GBP/USD* USD/CAD When Should I Avoid Trading?The least active time to trade -- dare we call it the “cold zone” -- is the European-Asian overlap session. Most traders are sleeping (or taking a nap) during this short period.

Trading volume is very thin and trends are unpredictable during this period. Stay out of the cold zone! However, this is a good time to get prepared for the opening of the European session.The cold zone runs from 2am to 4am EST.Remember, timing is a strong and important tool that action-seeking traders can use to find strong price movements. The Power Hours open a window for many trading opportunities. So, be prepared to trade like (and with) the professionals to make quick profits during these powerful hours.
This artcile originally by Robin Lofton

A reader recently asked me a good question for these volatile times: "How can I trade the way I want to trade and not trade P&L?"

I will provide my answer to this question, but then I'd like to invite readers to submit their own answers via comments to this post.

For me, position sizing is a psychological strategy as well as a strategy for risk management. If I have a system for position sizing and a stop-loss level, I can define precisely how much dollar risk I want to put into a trade idea.

My position sizing is currently half of what it normally runs; I've made that a standard practice when VIX > 30.

What that means is that I am keeping my dollar exposure to the market relatively constant across various market conditions. I do not experience undue psychological volatility during market volatility, simply because I do not allow myself to have more dollars at risk per trade. That normalizes my psychological exposure, allowing me to focus on trade ideas and the management of my positions rather than P/L swings.

I realize this goes against the grain of many traders' thinking. They see volatile market conditions and think that they should be making a fortune catching the large swings. But, to use the old analogy, I'd rather be the casino than the gambler. I'd like to take my piece of probability out of markets on a nice, steady, regular basis. It's much easier to not focus on P/L when no single trade or trading day can make or break your month. My dollar risk per trade is no different now than it was during 2007.

So how do you keep yourself trading the way you want to trade during these volatile times? Comments appreciated!

As I'm writing this, the ES futures are lock limit down and my email count is off the charts. Lots of fear, not much greed: fear, not only for one's trading, but for retirement savings and the economy. Most of people's money is tied up in some combination of stocks, bonds, and residential real estate. That means that many, many people are worth 25+% less than they had been just a year or so ago.

It is difficult to insulate those fears and concerns from one's trading. And yet, I do hear from traders who are making money in these markets. There *is* volatility, and there can be opportunity. Here are ten factors that stand out among the traders I talk with who are making money in the current environment:

1) Patience - The ones who are afraid of missing moves, who chase moves as a result, are getting hurt. The ones who wait for clear signals and good reward-to-risk opportunities can take advantage of the volatility. The successful traders aren't afraid of missing a move; they know, in this volatile environment, other opportunities will arise.

2) Position Sizing - Trading smaller when markets are moving more means that one or two losing trades won't knock you out for the day or the week. The successful traders tell me they're making plenty of money with smaller size simply because we're moving triple digits in the Dow just about every day.

3) Resilience - When you're wrong in these markets, you can really be wrong. My first trade yesterday lost over 20 S&P points; I wound up the day solidly in the green. By managing risk, you also manage emotions and can stay in the game. The successful traders are in there, making trades. They get off the canvas when they're wrong and they play defense, even as they look for opportunity.

4) Minimizing Distractions - One thing I noticed is that the successful traders in this environment have taken active measures to protect their personal finances. The less successful ones have been distracted by losses they're incurring outside of trading. It is difficult to focus on trading if you're worried about unemployment or loss of savings; addressing personal security helps maximize focus during trading.

5) Self-Maintenance - It's easy to get run down following markets through the day, every day, and then tracking them overnight and overseas. One troubled trader told me he was living, eating, and breathing trading. That is a risk factor for burnout, lessened concentration, and bad decision making. The successful traders aren't afraid to step away from the screens; once again, they know opportunity is not going to go away.

I'm finding that execution is the better part of success in these times. If you have a good idea, but the timing of your entry is wrong or your position is too large, you're likely to get stopped out at the worst conceivable time. By waiting for markets to put in a seeming high or low, waiting for a bounce or pullback that can't make a new price extreme, and *then* getting into a position, you can minimize the heat you take on trades. That, I'm finding, is half the battle.

Lots of fear, not much greed: fear, not only for one's trading, but for retirement savings and the economy. Most of people's money is tied up in some combination of stocks, bonds, and residential real estate. That means that many, many people are worth 25+% less than they had been just a year or so ago.It is difficult to insulate those fears and concerns from one's trading. And yet, I do hear from traders who are making money in these markets. There *is* volatility, and there can be opportunity. Here are ten factors that stand out among the traders I talk with who are making money in the current environment

1) Patience - The ones who are afraid of missing moves, who chase moves as a result, are getting hurt. The ones who wait for clear signals and good reward-to-risk opportunities can take advantage of the volatility. The successful traders aren't afraid of missing a move; they know, in this volatile environment, other opportunities will arise.

2) Position Sizing - Trading smaller when markets are moving more means that one or two losing trades won't knock you out for the day or the week. The successful traders tell me they're making plenty of money with smaller size simply because we're moving triple digits in the Dow just about every day.

3) Resilience - When you're wrong in these markets, you can really be wrong. My first trade yesterday lost over 20 S&P points; I wound up the day solidly in the green. By managing risk, you also manage emotions and can stay in the game. The successful traders are in there, making trades. They get off the canvas when they're wrong and they play defense, even as they look for opportunity.

4) Minimizing Distractions - One thing I noticed is that the successful traders in this environment have taken active measures to protect their personal finances. The less successful ones have been distracted by losses they're incurring outside of trading. It is difficult to focus on trading if you're worried about unemployment or loss of savings; addressing personal security helps maximize focus during trading.

5) Self-Maintenance - It's easy to get run down following markets through the day, every day, and then tracking them overnight and overseas. One troubled trader told me he was living, eating, and breathing trading. That is a risk factor for burnout, lessened concentration, and bad decision making. The successful traders aren't afraid to step away from the screens; once again, they know opportunity is not going to go away.

I'm finding that execution is the better part of success in these times. If you have a good idea, but the timing of your entry is wrong or your position is too large, you're likely to get stopped out at the worst conceivable time. By waiting for markets to put in a seeming high or low, waiting for a bounce or pullback that can't make a new price extreme, and *then* getting into a position, you can minimize the heat you take on trades. That, I'm finding, is half the battle.

Several traders tripped up by the narrow, range market. After a period of volatility such as we had during the first quarter of 2008, it is understandable that traders expect moves to extend. In a range market, however, reversals of market moves are the order of the day.

If traders don't recognize the character of the day early, it's easy to get chopped up in those reversals. Here are several cues I rely upon in gauging a possible range day. Not all of these are present on all of the days, and not all of these pertain to yesterday. As a whole, however, I've found these to be relatively accurate guides that help me pull back my trading, enter trades only near range extremes, and take profits more quickly than I would in a trending market.
1) Other, related markets are range bound - If the interest rate markets are in a narrow range, there may be little reason for investors to reprice equities;

2) Little news - Either there is no news and no economic reports, or the news and reports that come out fail to move interest rates, currencies, etc. Per number one above, that means that the news has not significantly impacted investor expectations, and there's little reason to move value;

3) Decreased volume - Often this is a first signal: Volume either starts the day well below recent norms, or quickly tails off to below average as the day goes on. This means that the large institutional participants that move markets (and ultimately set value) are not active and trade will be dominated, in relative terms, by market makers;

4) Narrow breadth - When we get an initial market move for the morning, it occurs on narrow breadth, with advancing and declining issues relatively balanced. That tells us that the move is not a broad trend;

5) Sector rotation - When we get that initial market move in the morning, some sectors may be up quite a bit (energy, for instance) and some might be down quite a bit (financials). When sectors are taking their separate paths, there is no general trend to the market;

6) Initial trades don't work - A scratched trade often provides market information. If you catch an early market move and then it reverses on you before it hits an expectable price target, you have an early indication of the character of the day.

It's worth paying attention to good trade ideas that don't pay you out. The main thing is to not overtrade these narrow days. If a market is trading in a range, the best trades are to fade moves around the range extremes. Since moves tend not to extend, it's necessary to take profits more aggressively than you ordinarily would.As the VIX grinds to new lows and we get closer to possible summer doldrums, we may see an increasing number of these narrow days. If you can recognize them early, you can preserve your capital and maybe even make a little money.

Did you know that you can make money from your blog? Bloggerwave call blogger to be partner and make money from blogging. All you need is just posting any review, at least content 50 words, and you'll be paid each review you posted on your blog.Bloggerwave is aiming to be Europes biggest advertsing media on blogs and you can help us grow so more and more jobs will come. As a publisher, we will be paid per review they posted on our blog.

There is one aspect that is considered as one of the best advantages of FOREX Trading. This is related to the amount of money you need to place a trade, this is known as "margin", and in short, this is all that can be lost in a the case you had a bad trade.

Futures markets are often prone to sudden and dramatic moves, against which you can not protect yourself, even by trading with protective stops. Your position may be liquidated at a loss, and you’ll be liable for any resulting deficit in the account. But because of the FX markets deep liquidity and 24-hour, continuous trading, dangerous trading gaps and limit moves are eliminated. Orders are executed quickly, without slippage or partial fills. And finally, there are no margin calls -- for your protection, ALL our recommended brokers will automatically close out some or all of your open positions if your account equity falls below the level required to hold the positions. Think of this as a final, automatic stop, always working on your behalf to prevent a debit balance. In fact, if you pick from our list of recommended brokers, we guarantee that you will never lose more than you have in your FOREX account.

If you want to find an appreciable number of profitable trades when trading Forex you need to enter the forex market at the best period of time. This means you should enter when the activity, the volume of transactions, is the highest. All experienced traders focus on the hours when the currency markets tend to make their biggest moves, i.e., during the big market overlaps, which therefore, are usually the best times to trade.
Forex markets are open worldwide with the following schedule:
* New York Market trade times: 8am-4pm EST
* London Market trade times: 2am-12Noon EST
* Great Britain Market trade times: 3am-11am EST
* Tokyo Market trade times: 8pm-4am EST
* Australia Market trade times: 7pm-3am ESTForex markets have also these timing characteristics:
* Forex Trading begins in New Zealand, followed by Australia, Asia, the Middle East, Europe, and America
* The US & UK account for more than 50% of the market transactions
* Forex Major markets: London, New York, Tokyo
* Nearly two-thirds of NY activity occurs in the morning hours while European markets are open.From this timing facts, it is evident that at any given time, somebody somewhere in the world is buying and selling currencies. As one market closes a different market opens. Business hours overlap, and the exchange continues as day becomes night and night becomes day.

The great liquidity of Forex, combined with the fact that's traded 5.5 days a week around the world, offers every trader an exceptional independence and choices to trade Forex when you want to and not when the market wants you to do it. It’s a facts that trades always develop with relatively the same frequency, regardless of time. As long as the Forex market is open, there is about the same probability that you will find a trade, whenever your look for it.

Forex market volume of transactions remains high during the whole day, but peaks highest when the Asian market(including Australia & New Zealand), the European market and the U.S. market are open simultaneously. And these are the best trading hours you must target in order to find the highest possible amount of profitable trades.During each trading day, the total Forex “volume” is determined by the number of markets that are open and the times each of these markets overlap one another.

As we have discussed before, this discussion forum is to explore the psychology behind the success or failure to trade successfully. As most traders with any experience know, the ability to “call “ the market is relatively easy in comparison to getting properly positioned within the market, and taking the most amount of money from your observation; that is where the real work of lasting trading success really lies. All of us have found the actual bottom or top of a significant move but failed to capitalize on that opportunity for one reason or another.

This month, I would like to address one of the more common trading errors. Everyone has made the error of overtrading at some point and many continue to make this error despite knowing they have this problem. Just knowing you have a propensity for a trading problem is half the battle but more importantly, you need skills and tools to correct your trading error. One of the more critical skills to develop in my view is to stop and confront the problem of overtrading.

Overtrading is a symptom of a deeper psychological problem which I like to call attachment to results. All traders have a certain degree of results they are pursuing in the markets; that is not the problem. The markets exist to exploit inequalities (real or imagined) in the supply and demand of something or financial instruments. It is a good thing to see an opportunity and assume the risk for the potential that is there. Once that action has been taken the only question is whether or not that inequality you perceived is an actual event that is unfolding over time. Between the time you execute for an entry and the time you liquidate for an exit; the markets will be moving. That movement is where the issue of attachment to results translates into your personal results.Attachment to results can actually be expressed two ways depending on your personal psychology and trade method. The first way is holding losers and the other way is overtrading. We will discuss the issue of holding losses at a later time but the net effect on your equity is the same whether your problem is holding losses too long or you overtrade. Attachment to you results is the bedrock problem behind either overtrading or holding losses. In the case of overtrading, it represents the psychological need for immediate results (or positive results) without the corresponding willingness to allow time to pass. I think it is safe to say that a certain amount of time is required for any trading style to generate a gain and the unwillingness to let the required amount of time to pass comes out in the markets as constant execution over some timeframe.

If you use an hourly timeframe to pick your points of entry it is safe to assume that more than one hour must pass in order to determine if your executed trade has potential as you see it. Should the market move against your position that is to be expected, it is unreasonable to assume you will “buy the low” or “sell the high” every time you trade. As the market moves, if you are attached to your results, that movement means something to you. It is personally helping or hurting your equity. As your account balance changes from open trade equity, your focus narrows down to how this is affecting you personally. Most traders with this problem now seem to forget the high degree of study, preparation and thought they invested into picking that spot to execute. For some reason, the long-term fundamentals are forgotten, the technical studies are re-evaluated in real time, the protective stop order might be moved and the limit order to take the gain is moved closer to the market. Or any number of things. Then this trader executes to exit the market. Prices remain near their entry or advance. Attachment to results now says “You are missing it! You were right!” and this trader now executes again for an entry. As prices return to the first entry price, this trader again has a small open-trade loss; again the trader’s attachment says the trade is not going to work.

This process may repeat itself several times over a short period of time, especially if the market is advancing in the intended direction. The problem is not the market price action; the problem is the attachment to results imposed by the trader creating an urge to action that is not consistent with normal ebb and flow of most market action. The trader has failed to allow time to pass and let the market do what it is going to do. During a major price advance or decline that was properly observed, this trader has small gains or even net losses when his just sitting tight for a period of time would have resulted in a nice gain.Solving this problem is a factor of learning patience as well as adapting your thinking to better fit with the market you trade.

I have observed from working with many developing traders that if they have the problem of overtrading, the simplest solution is to impose a new set of rules on their execution that allows time to pass. I have a very common sense based method that I would encourage you to try for yourself. Simply turn your screen off; the assumption here is that the market will do what it will do whether you watch it or not. The problem is not the market price action, the problem is attaching meaning to that action and executing. If you can’t see the price action, you can’t execute. So the first thing we do is impose the rule: After you execute you have to turn the screen off for at least one bar of your time frame as a minimum.In most cases, several bars are needed to either confirm or deny a trade potential is developing so often the trader must sit in front of a dark screen for several hours. The market is still moving, but in this case, the stop is also still where it was originally placed, the limit is still where it was placed and the trader cannot reevaluate the trade nor do anything except wait. During this time I also require the trader to write out in as much detail as possible exactly his hypothesis for the trade. This keeps the trader focused on the critical thought required to do the trade as opposed to how the tic-by-tic price action is affecting his equity. After enough time, this self-imposed isolation develops into patience to let the trade work. At some point, the trader will no longer need to be “in the dark” and he has the skill to simply sit still and let the trade work.

Next month we will talk more about attachment to results as it comes out when you hold losing positions. In the meantime, if you have a tendency to overtrade; try this method. I think you will be surprised at how fast you learn to let your trades work.

At a gathering of investment bank trainees in suburban New York last night, I was asked my opinion of the most common problem among traders. My answer was neither fear nor greed. It was overconfidence.

Studies in behavioral finance find that about 3/4 of all traders rate their prowess as "above average", despite the obvious reality that only half of us are better than the other half. This overconfidence, moreover, affects actual trading performance. Research by Terence Odean and colleagues finds that overconfidence affects frequency of trading, which in turn contributes to poor trading results. In one study of online traders, the group of traders favored high beta (volatile) small cap companies and tended to not diversify their portfolios. Their actual trading results slightly beat the small cap index, but after trading costs were factored in, they significantly underperformed the index. The most frequent traders were the ones who underperformed the index by the greatest margin.

One of my favorite studies of overconfidence came from the London Business School. Traders were shown price patterns and asked to figure out the market's next direction and indicate their confidence in their prediction. The price patterns were generated entirely randomly. The traders with the highest confidence in their predictions traded the most frequently and incurred the greatest losses. A completely random trader--50% right, 50% wrong--who trades once a day will have runs of five consecutive winners about six times during a year. It is difficult to not think you have the hot hand after such a string, become overconfident, and raise your trading size. Of course, the random trader will have an equal number of strings of losers. That is likely to burst confidence and lead the trader to cut trading size--assuming, of course, that he's still in the game at that point.Is it any wonder that traders seek help from coaches and psychologists? Few of those coaches and psychologists, however, will tell the trader the truth: You're trading random patterns and your problem is overconfidence in them.

If you want to find an appreciable number of profitable trades when trading Forex you need to enter the forex market at the best period of time. This means you should enter when the activity, the volume of transactions, is the highest. All experienced traders focus on the hours when the currency markets tend to make their biggest moves, i.e., during the big market overlaps, which therefore, are usually the best times to trade.

Forex markets are open worldwide with the following schedule:
* New York Market trade times: 8am-4pm EST
* London Market trade times: 2am-12Noon EST
* Great Britain Market trade times: 3am-11am EST
* Tokyo Market trade times: 8pm-4am EST
* Australia Market trade times: 7pm-3am ESTForex markets have also these timing characteristics:
* Forex Trading begins in New Zealand, followed by Australia, Asia, the Middle East, Europe, and America
* The US & UK account for more than 50% of the market transactions
* Forex Major markets: London, New York, Tokyo
* Nearly two-thirds of NY activity occurs in the morning hours while European markets are open.

From this timing facts, it is evident that at any given time, somebody somewhere in the world is buying and selling currencies. As one market closes a different market opens. Business hours overlap, and the exchange continues as day becomes night and night becomes day.

The great liquidity of Forex, combined with the fact that's traded 5.5 days a week around the world, offers every trader an exceptional independence and choices to trade Forex when you want to and not when the market wants you to do it. It’s a facts that trades always develop with relatively the same frequency, regardless of time. As long as the Forex market is open, there is about the same probability that you will find a trade, whenever your look for it.

Forex market volume of transactions remains high during the whole day, but peaks highest when the Asian market(including Australia & New Zealand), the European market and the U.S. market are open simultaneously. And these are the best trading hours you must target in order to find the highest possible amount of profitable trades.

There is one aspect that is considered as one of the best advantages of FOREX Trading. This is related to the amount of money you need to place a trade, this is known as "margin", and in short, this is all that can be lost in a the case you had a bad trade.

I state it like this because, even though I know with proper self-taught education you're NOT going to lose as much as you win anyway, I want you to know that despite the super-high leverage associated with FOREX trading (200:1 is possible; meaning that if you put up $1 the trading vendor will allow you to trade like you really have $200), it's still arguably less risky than futures (commodities) trading. And, forget stocks, you'll never get this type of LEVERAGE in the equities market.

Futures markets are often prone to sudden and dramatic moves, against which you can not protect yourself, even by trading with protective stops. Your position may be liquidated at a loss, and you’ll be liable for any resulting deficit in the account. But because of the FX markets deep liquidity and 24-hour, continuous trading, dangerous trading gaps and limit moves are eliminated. Orders are executed quickly, without slippage or partial fills. And finally, there are no margin calls -- for your protection, ALL our recommended brokers will automatically close out some or all of your open positions if your account equity falls below the level required to hold the positions. Think of this as a final, automatic stop, always working on your behalf to prevent a debit balance. In fact, if you pick from our list of recommended brokers, we guarantee that you will never lose more than you have in your FOREX account.

Although the first quarter of 2008 ended on March 31, it wasn't until last week that the Federal Reserve Bank finally finished tallying all of the data and released its obligatory report on the performance of the Dollar. On a trade-weighted basis, the Dollar declined 4%, a figure which accounts for a whopping 11% decline against the Japanese Yen and an 8% decline against the Euro. According to the Fed's analysis, January was relatively kind to the Dollar, as traders remained uncertain as to how the credit crisis would affect the US economy. An outpouring of negative data in the next 4-6 weeks sent the Dollar spiraling downward, although it recovered at the end of March, as the Fed moved to build liquidity in the financial markets. The Fed also noted that it did not intervene in currency markets during the first quarter, firmly putting to rest rumors to the contrary. Forbes reports:There had been intermittent discussion in the markets of a coordinated foreign exchange intervention by the G-3 central banks, but the Fed report confirmed officially what markets already realized.

Are looking for new credit cards for your business or for your personal usage? Today having a credit card is not difficult anymore, many credit card issuer give special offer to get their customer. They are now competing to get customer. This condition in one hand will give much benefits for card holder, or anyone who are looking for credit card, but in other hand will create a new problem.

That's why you should be more selective to find the most credible credit card issuer. Credit Card Club help you to find the best credit card as you need. There are many credit card, compare the best one that meet to your financial condition.I recommend you to get the low interest credit cards. Why? If you are the type who like to make cash advances, do balance transfer credit cards or pay only the minimum monthly dues and leave balances in your account, check out the Annual Percentage Rates or APRs of various credit cards and you will note differences between them.

The lower the interest rate is the better. Many new entrants in the credit card business do offer APRs that are lower than what established card brands offer. And most of them advertise introductory APRs that can benefit cardholders who prefer to pay minimum dues.Please check these special offer no annual fee credit cards

The US Federal Reserve Bank is known for ambiguity and vagueness. The Bank of England, it appears, is not trying to emulate this approach. The Bank put an end to speculation about its near-term monetary policy by announcing that it does not plan to cut interest rates for at least two years. Apparently, inflation has breached the Bank's 2% target, and its internal models are forecasting that it won't be until 2010 that price inflation returns to a more palatable rate. This is bad news for the British economy, which is in the throes of an economic downturn precipitated by the housing crisis and would surely benefit from a loosening of monetary policy. By extension, the British Pound should also suffer a "correction," as a combination of inflation and lack of suitable investment opportunities will send investors rushing for the exits. The Financial Times reports:Mr King contrasted his position – and its focus on controlling inflation – with that of Ben Bernanke of the US Federal Reserve. “We did not fall prey to the sirens to cut interest rates further as some other central banks have done,’’ he said.

Read More: No interest rate cut for two years, Bank warns

I spent some time over the weekend scanning through the Fortune 100 Fastest Growing Companies for 2007 for companies that interest me. I would look at the company’s business, recent sales and earnings, and future earnings projections. No calculator, just an eyeball on growth rates vs. PE. It was interesting, since the list was compiled in mid 2007, how many companies on the list had had recent earnings set backs. While going through the list I noted some personal likes and dislikes of company attributes that cause me to look favorably or unfavorably on a stock.

Some of my dislikes:

* Companies that have business selling to other companies. There is something about a company that is reliant on another company or industry to manufacture good products and sell them profitability that I avoid. Even if the company is the best around and well run, bad economics or management by their customers can seriously affect the suppliers bottom line.

* Faddish retail companies. Clothing lines, beverages and restaurants. These can all lose ground to the next hot item if they do not come up with the next hot item themselves.

* I have a tendency to avoid all health care and pharmaceuticals. Although health care sucks up a huge portion of the U.S. GDP, I just feel the whole thing is propped up by ever increasing costs that will someday collapse. I am probably entirely paranoid here, but I do not invest in this area.

* Fast growing companies with no earnings set off warning bells in my head. It is my belief that it is easier for a company with hot products or in a hot sector to grow revenues than earnings. A hot company has to start bringing significant dollars to the bottom line before I get interested.Some of my preferences:

* I gravitate to companies with market capitalization between $500 million and $2 billion, plus or minus. I believe companies this size are big enough to have established themselves, but too small for most of Wall Street to have found. Often they have between 1 and 4 analysts following them and good information is hard to find. Maybe I can find a nugget of news that shows me the market has miss-valued the stock.

* I like industries with products people and business must have: Energy, transport, gambling, banking., infrastructure. Well run companies in these business can often count on a certain built in customer base and work to maintain or improve margins.

* I get interested in a company that has a business or niche I have not previously heard of. This might be a company that has carved out a profitable niche by offering a unique product or service.

I will read deeper to see if there is more to get interested in.Once I find a company of interest I usually add it to my Watch List. At some point I will come back to it and dig deeper into finances and their story. It may be the next day or weeks down the road. Right now energy companies are hot and anything to do with home construction is not. I have some of both on the Watch List to get back to as market conditions change. When I review deeper I may keep a stock on the list, remove it because I do not find a compelling reason to keep monitoring it, or move it to one of the portfolios I track here. One thing I try to keep in mind is that prospects change for companies, sectors and markets and it is important to keep options open.by Tim Plaehn, published at www.gracecheng.com

The Euro rose to a three-week high of 1.5680 against the US dollar Tuesday after Wolfgang Franz, head of the Center for European Economic Research, or ZEW, said he thinks the ECB “will raise rates in the near future”, but “would recommend that the ECB keep rates constant until there is clear evidence the financial crisis is over”. EUR/USD initially dipped after the release of the economic sentiment survey from ZEW that came in weaker than expected, but then rose higher on the ZEW president’s comments. Germany’s economic sentiment index fell to -41.4 in May, compared with an expected reading of -37. But it’s not just a one-way street in the currency market today: US dollar weakness was limited somewhat as it got some support from higher-than-expected inflation data which showed that US producer price index for finished goods rose 0.2% in April, following a 1.1% increase in March, and core prices excluding food and energy, rose 0.4% last month, twice the 0.2% forecast. Such firm inflation numbers could persuade the Fed to keep rates on hold.

The US dollar also got a bit of support after Federal Reserve Vice Chairman Donald Kohn said the US economy will improve in the second half of the year and gather some strength in 2009. His cautiously optimistic outlook mirrors that of US Treasury Secretary Paulson. Kohn also said the Fed’s current policy stance “appears to be appropriately calibrated for now to promote both rising employment and moderating inflation over the medium term.”Aussie Dollar Shot Up AgainThe Australian dollar hit another 24-year high for the second straight day after minutes of the Reserve Bank of Australia’s last meeting indicated that the board discussed rate hikes for a “considerable time”. Australia is currently the odd one out among the world’s major central banks in that it is seriously considering raising interest rates while others are busy cutting. AUD/USD reached as high as 0.9620, its highest point since March 1984.

Forex TradingUSD/CHF fell below 1.0390-1.0400 to a session low of 1.0375. If it breaks below 1.0350, it could target 1.0300-10. Beware that USD/CHF is on the verge of breaking down from its double top, but the said bear target could provide some temporary bidding interest. If that gives way, more aggressive shorts could join in. EUR/USD broke above 1.5650 to a high of 1.5680, with 1.5700-10 its nearest ceiling. Its strength of holding above 1.5500 could send it on its way higher.Wednesday:Australia Westpac consumer confidence 0030 GMTBank of England minutes 0830 GMTUS MBA mortgage applications 1100 GMTCanada CPI 1100 GMTUS FOMC minutes 1800 GMTJapan merchandise trade balance 2350 GMTSource: www.gracecheng.com

Forex autopilot trading software offers robot-driven automatic trading of the forex market. Creators of these automated forex trading systems claim you can make easy profits with very little time invested, and without having to understand complex algorithms. In this review, I will show you how to determine if forex autopilot or robot trading systems are legitimate or scams.First of all, any forex trading system software that guaranteeing easy, consistent profits is an outright scam.

The forex market, like the stock market, consists of too many random factors. Anyone promising to be able to read the future like a fortune teller is a liar. Forex trading is similar to gambling. But what successful forex robot systems can do, is boost the odds slightly in your favor. Then, there will be a slight probability that you will make money over the long run.However, past success is NOT an indicator of future success for a forex autopilot trading system. Scientifically speaking, this is because the forex market has "no memory", that is, the future and past are unrelated. Just because an advertisement shows you an incredible "historical track record" does not guarantee future success.

This is why legitimate forex robot trading systems will have a disclaimer that there is NO guarantee of profits and that the product is for educational purposes only.This leads to a problem, though. When you purchase a forex autopilot trading system, by agreeing to their terms of service, you have given up all rights or guarantees for a useful product. They can now sell you COMPLETE junk, and since you agreed to take the risk, there is nothing you can do. Make sure that you can at least get a refund if you are not satisfied. Furthermore, try to search for reviews of specific forex software online before you make a purchase. In summary, just because a forex robot trading system made profits in the past does not mean it will make profits for you in the future. You should be very wary of forex software promising profits, as the random forex market is impossible to predict.

Make sure you read reviews of forex autopilot trading systems before you make a purchase, or at least make sure you can get a refund if you are not happy.Instead of hoping someone will give you a hands-free, mind-free way of making money in the forex market, the best investment is learning yourself how the forex market works. You will not be scammed if you understand and test the forex market yourself.

The U.S. DollarThe United States dollar is the world's main currency. All currencies are generally quoted in U.S. dollar terms. Under conditions of international economic and political unrest, the U.S. dollar is the main safe-haven currency which was proven particularly well during the Southeast Asian crisis of 1997-1998.

The U.S. dollar became the leading currency toward the end of the Second World War and was at the center of the Bretton Woods Accord, as the other currencies were virtually pegged against it. The introduction of the euro in 1999 reduced the dollar's importance only marginally.The major currencies traded against the U.S. dollar are the euro, Japanese yen, British pound, and Swiss franc.

The Euro
The euro was designed to become the premier currency in trading by simply being quoted in American terms. Like the U.S. dollar, the euro has a strong international presence stemming from members of the European Monetary Union. The currency remains plagued by unequal growth, high unemployment, and government resistance to structural changes. The pair was also weighed in 1999 and 2000 by outflows from foreign investors, particularly Japanese, who were forced to liquidate their losing investments in eurodenominated assets. Moreover, European money managers rebalanced their portfolios and reduced their euro exposure as their needs for hedging currency risk in Europe declined.

The Japanese Yen
The Japanese yen is the third most traded currency in the world; it has a much smaller international presence than the U.S. dollar or the euro. The yen is very liquid around the world, practically around the clock. The natural demand to trade the yen concentrated mostly among the Japanese keiretsu, the economic and financial conglomerates.The yen is much more sensitive to the fortunes of the Nikkei index, the Japanese stock market, and the real estate market. The attempt of the Bank of Japan to deflate the double bubble in these two markets had a negative effect on the Japanese yen, although the impact was short-lived.

The British Pound
Until the end of World War II, the pound was the currency of reference. Its nickname, cable, is derived from the telex machine, which was used to trade it in its heyday. The currency is heavily traded against the euro and the U.S. dollar, but has a spotty presence against other currencies. The two-year bout with the Exchange Rate Mechanism, between 1990 and 1992, had a soothing effect on the British pound, as it generally had to follow the deutsche mark's fluctuations, but the crisis conditions that precipitated the pound's withdrawal from the ERM had a psychological effect on the currency.Prior to the introduction of the euro, both the pound benefited from any doubts about the currency convergence. After the introduction of the euro, Bank of England is attempting to bring the high U.K. rates closer to the lower rates in the euro zone. The pound could join the euro in the early 2000s, provided that the U.K. referendum is positive.

The Swiss Franc
The Swiss franc is the only currency of a major European country that belongs neither to the European Monetary Union nor to the G-7 countries. Although the Swiss economy is relatively small, the Swiss franc is one of the four major currencies, closely resembling the strength and quality of the Swiss economy and finance. Switzerland has a very close economic relationship with Germany, and thus to the euro zone. Therefore, in terms of political uncertainty in the East, the Swiss franc is favored generally over the euro.Typically, it is believed that the Swiss franc is a stable currency. Actually, from a foreign exchange point of view, the Swiss franc closely resembles the patterns of the euro, but lacks its liquidity. As the demand for it exceeds supply, the Swiss franc can be more volatile than the euro.

Foreign exchange brokers, unlike equity brokers, do not take positions for themselves; they only service banks. Their roles are:

• bringing together buyers and sellers in the market;
• optimizing the price they show to their customers;
• quickly, accurately, and faithfully executing the traders' orders.

The majority of the foreign exchange brokers execute business via phone. The phone lines between brokers and banks are dedicated, or direct, and are usually in-stalled free of charge by the broker. A foreign exchange brokerage firm has direct lines to banks around the world. Most foreign exchange is executed through an open box system—a microphone in front of the broker that continuously transmits everything he or she says on the direct phone lines to the speaker boxes in the banks. This way, all banks can hear all the deals being executed. Because of the open box system used by brokers, a trader is able to hear all prices quoted; whether the bid was hit or the offer taken; and the following price. What the trader will not be able to hear is the amounts of particular bids and offers and the names of the banks showing the prices. Prices are anonymous the anonymity of the banks that are trading in the market ensures the market's efficiency, as all banks have a fair chance to trade.

Brokers charge a commission that is paid equally by the buyer and the seller. The fees are negotiated on an individual basis by the bank and the brokerage firm.

Brokers show their customers the prices made by other customers either two-way (bid and offer) prices or one way (bid or offer) prices from his or her customers. Traders show different prices because they "read" the market differently; they have different expectations and different interests. A broker who has more than one price on one or both sides will automatically optimize the price. In other words, the broker will always show the highest bid and the lowest offer. Therefore, the market has access to the narrowest spread possible. Fundamental and technical analyses are used for forecasting the future direction of the currency. A trader might test the market by hitting a bid for a small amount to see if there is any reaction.

Brokers cannot be forced into taking a principal's role if the name switch takes longer than anticipated.

Another advantage of the brokers' market is that brokers might provide a broader selection of banks to their customers. Some European and Asian banks have overnight desks so their orders are usually placed with brokers who can deal with the American banks, adding to the liquidity of the market.

Currency exchange is very attractive for both the corporate and individual traders who make money on the Forex - a special financial market assigned for the foreign exchange. The following features make this market different in compare to all other sectors of the world financial system:

• heightened sensibility to a large and continuously changing number of factors;
• accessibility to all traders in the major currencies;
• guaranteed quantity and liquidity of the major currencies;
• increased consideration for several currencies, round-the clockbusiness hours which enable traders to deal after normal hours or duringnational holidays in their country finding markets abroad open and
• extremely high efficiency relative to other financial markets

This goal of this manual is to introduce beginning traders to all the essential aspects of foreign exchange in a practical manner and to be a source of best answers on the typical questions as why are currencies being traded, who are the traders, what currencies do they trade, what makes rates move, what instruments are used for the trade, how a currency behavior can be forecasted and where the pertinent information may be obtained from. Mastering the content ofan appropriate section the user will be able to make his/her own decisions, test them, and ultimately use recommended tools and approaches for his/her own benefit.

Currency trading has a long history and can be traced back to the ancient Middle East and Middle Ages when foreign exchange started to take shape after the international merchant bankers devised bills of exchange, which were transferable third-party payments that allowed flexibility and growth in foreign exchange dealings.

The modern foreign exchange market characterized by the consequent periods of increased volatility and relative stability formed itself in the twentieth century. By the mid-1930s London became to be the leading center for foreign exchange and the British pound served as the currency to trade and to keep as a reserve currency. Because in the old times foreign exchange was traded on the telex machines, or cable, the pound has generally the nickname “cable”. In 1930, the Bank for International Settlements was established in Basel, Switzerland, to oversee the financial efforts of the newly independent countries, emerged after the World War I, and to provide monetary relief to countries experiencing temporary balance of payments difficulties.

After the World War II, where the British economy was destroyed and the United States was the only country unscarred by war, U.S. dollar became the prominent currency of the entire globe. Nowadays, currencies all over the world are generally quoted against the U.S. dollar.

Currency exchange is very attractive for both the corporate and individual traders who make money on the Forex - a special financial market assigned for the foreign exchange. The following features make this market different in compare to all other sectors of the world financial system:

• heightened sensibility to a large and continuously changing number of factors;
• accessibility to all traders in the major currencies;
• guaranteed quantity and liquidity of the major currencies;
• increased consideration for several currencies, round-the clockbusiness hours which enable traders to deal after normal hours or duringnational holidays in their country finding markets abroad open and
• extremely high efficiency relative to other financial markets.

Currency trading has a long history and can be traced back to the ancient Middle East and Middle Ages when foreign exchange started to take shape after the international merchant bankers devised bills of exchange, which were transferable third-party payments that allowed flexibility and growth in foreign exchange dealings.

The modern foreign exchange market characterized by the consequent periods of increased volatility and relative stability formed itself in the twentieth century. By the mid-1930s London became to be the leading center for foreign exchange and the British pound served as the currency to trade and to keep as a reserve currency. Because in the old times foreign exchange was traded on the telex machines, or cable, the pound has generally the nickname “cable”. In 1930, the Bank for International Settlements was established in Basel, Switzerland, to oversee the financial efforts of the newly independent countries, emerged

after the World War I, and to provide monetary relief to countries experiencing temporary balance of payments difficulties.After the World War II, where the British economy was destroyed and the United States was the only country unscarred by war, U.S. dollar became the prominent currency of the entire globe. Nowadays, currencies all over the world are generally quoted against the U.S. dollar.

Do you see the profit potential in trading currencies, but learning to trade just seems too daunting? Have you watched with excitement the recent crashing of the value of the USD, but simply don’t know how to get started trading?

While it is simple to begin trading Forex online, maintaining profitability in the long term is no easy task. You have probably heard that 90% of Forex traders lose their money in the long term. If indeed this is true, it is the result of a couple of different factors

Overtrading: Each trade costs you a couple of pips—Consider your trades well before you make them. Each faulty trade, even if exited quickly, drains equity.

Bad money management: One bad trade can wipe out a year of patient, smart trading. Manage your risk using stop loss orders, so that you never risk too high a percentage of your equity on any one single trade.

Lack of knowledge: If you have never traded Forex before, educate yourself! Successful traders are not born that way. The difference between success and failure in the Forex market depends in no small part on the knowledge and education of a trader. For the beginning trader, a proper education is essential before investing in the Foreign Exchange. Find a program you are comfortable with, and begin practicing on a demo account.

Trading on the foreign exchange offers unparalleled opportunities for profit, but it is also extremely risky. Make sure you know what you are getting into before you start trading, and start trading only when you are comfortable in your knowledge and ability.

The carry trade is a popular online Forex strategy which takes advantage of the different interest rates between two currencies.
If one currency has a relatively low interest rate it can be sold against a currency with a high interest rate and the trader may pocket the interest rate differential.
Speculators are guaranteed rollover interest deposits in their account at the end of each trading day.

This can provide a significant boost to trader’s profit. If, for instance, an investor buys the NZD against the JPY, which have interest rates of 7.25 and
.25 respectively, the trader can make a profit of 7% provided the market doesn’t move.However, even when exploiting interest rate differentials, there are still significant risks to a trader. Obviously, the market can still move against the trader’s position, though the rollover interest adjustments do help mitigate potential losses. Considering that most carryover traders use exceptionally high leverages to exploit interest rate differentials, even a small move against a position can lead to very high losses

Forex scalping is a trading strategy in which the trader makes dozens or even hundreds of trades daily, looking to capture a few pips per trade.

Generally, scalpers stay in trades for less than a minute, bolting as soon as their position captures a few pips.

Brokers do not look kindly upon scalpers, as many times scalpers will exit a position before the dealing desk has time to deal your order.

This means that the brokerage has to eat the position—a successful scalper will consistently earn money—money that comes directly from the brokerage’s pocket.To avoid this conflict of interest between scalpers and the brokerages, scalpers often trade with electronic communication network (ECN) brokerages, which circumvent the dealing desk allowing online traders to trade directly with one another.

ECN brokerages usually have less liquidity than traditional dealing desk brokerages and charge a per trade commission, but their pip spreads are narrower.To be a successful online Forex scalper, traders must follow strict risk management rules.
Because the scalper grabs only a couple of pips at a time, one big loss can wipe out dozens and dozens of careful, meticulous trading. Traders should be sure to use stop loss orders, ensuring that the profit/loss margin on each trade is very small.

Until the mid-seventies, major industrial economies were governed by the Bretton Woods agreement of 1944. The Bretton Woods agreement—which was named after the location of the international conference establishing this new monetary order—obliged participating international economies to peg their currencies to the dollar, which itself remained within a 1% standard deviation from the prevailing gold rate.

The architects of the Bretton Woods agreement hoped to prevent countries from artificially devaluating currencies, in order to make goods more attractive in the international marketplace, which led, in part, to a disastrous shrinking of the world economy in the 30s.The system they established lasted for the next three decades.

Shrinking confidence in the dollar, however, lead to a new international monetary system of floating rates, meaning that regular market forces, rather than governmental intervention, would determine the value of currencies.

It was from this new system that the modern Forex market arose.In a floating exchange rate system, market demand determines the relative value of currencies. Such a system is thought of as self-correcting, as any inefficiency is hammered out in the market.

If, for instance, global demand for a particular currency falls, goods will become cheaper, and thus the value will begin to rise with the newly created demand.In a floating exchange system, traders can exploit inefficiencies before the market corrects itself.

These traders are called arbitrageurs, and they are able to utilize online brokers to execute their trades. If you are interested in beginning to trade in the Foreign Exchange, please visit our broker’s page to find a broker suitable for you.

There are tons of reasons!-The high level of liquidity ensures instantaneous order executions in most market conditions.-24 hour trading! The major Foreign Exchange centers are located in New York, London, and Hong Kong. The end of one trading day is the beginning of another. Traders are able to trade at any convenient time, no matter where their location.

Furthermore, traders can always react quickly to any market altering news.-Because of the immense size of the market, no single actor can substantially impact the market. Even multibillion dollar transactions are a relatively small percentage of the overall market, and can alter prices only slightly, and in the short term.

-Investors can trade on very high leverage, controlling large positions with relatively small amounts of money. Of course, while a movement in the trader’s favor results in large earnings relative to investment, movement against the position can result in the investment being wiped out. Using high leverages can be both risky and rewarding.

- Unlike, for instance, the stock market, in which traders must be familiar with hundreds of stocks, a online Forex trader need only be familiar with a few currencies.-Whether a given currency is rising or falling, investors have the same profit potential.
The Foreign Exchange is truly always a bull market.Experience the online Forex market for yourself! Give one of our reviewed brokers a test drive. Sign up for a demo account, and gain instant access to the world’s largest market

The fundamental analyst in Forex attempts to draw overall conclusions concerning the economic health of a particular economy based on political, social and economic indicators. Based on these conclusions, fundamental analysts determine whether a particular currency is over or undervalued, and trade accordingly.

While fundamental analysis is useful in determining the overall health of an economy, the number of factors contributing to the health of an economy may condemn the fundamental trader to a life of constant analysis. And while, when a conclusion is drawn, a fundamental analyst can confidently hold a long term position, some might say they are missing out on other profitable opportunities.

Unlike the Fundamental analyst, Technical analysts believe that all the forces impacting currency price are instantly factored into the market. Eschewing news trading, the technical analyst attempts to construct forecast models for particular currencies based on previous market activity, as reflected in the charts.

There are certain patterns that continuously appear in online Forex movements, and if a particular pattern can be recognized before it is complete, online traders can make substantial profit.Beneath the sound and fury of seemingly arbitrary price fluctuations, the technical analysts locates identifiable patterns in the charts. Certain patterns that continuously appear in currency movements—such as head and shoulders, ascending and descending triangles, and wedges, to name a few—and technical traders look for these in order to identify entry and exit points.

Some brokerages provide complimentary advanced charting features, complete with dozens of indicators and tools used to aid in technical analysis.

You’ve decided to become a trader on the Forex market but since you’ve never played on the currency market you aren’t sure where to start. Not to worry – we’ve got some great tips for global Forex trading,

Forex is the foreign exchange market where currencies are bought and sold. It began back in the 1970’s with the introduction of free exchange rates and floating currencies. Thanks to the internet more and more people are able to reap the profits of the currency market with global Forex trading.

This is a market that trades as over US$1 trillion a day. It trades more than any other market. There are some distinct differences in the currency market compared to the stock market. Money moves much faster so no single investor has the ability to actually affect market price and trades are able to open and close within seconds which is not possible on the stock market.
To start your global Forex trading you need to open a Forex account. Just fill in the application and the sign the margin agreement which let’s the broker intervene at any time. That makes sense since it’s the broker’s money that just makes sense.

You need to choose a trading strategy that works for you. Different strategies work for different traders to don’t try to makes something work, instead find the right trading strategy for you.It’s important to understand that trends move prices so a smart investor will make trends their friend and even go so far as to examine historical trends.

The top five currency pairs are USD/Yen, Euro/Yen, Swiss franc/USD, Pound USD/ and the Euro/USD. Make sure you know and understand them.Examine the charts at 1 hour, 4 hour, and daily. This will give you the daily trends and plenty of opportunity to trade. Sure you can trade every 15 minutes if you like but that’s not really practical.Now that you’ve got all your global Forex trading tips you’re ready to see some profits.

If you plan to start trading with Forex online you will need the right software system to give you the ability to collect information on market prices and make Forex trades quickly and easily. There are two types of Forex software available. One is web based while the other is client based.

The Forex market is a high paced fast moving market and to make good trades you need good information and with the right software and a high speed internet connection everything you need is only mouse click away. You just need to decide on which software is best for you.

Client based Forex trading software is downloaded and then installed on your computer. The biggest draw back to a client based system is that you can only access it from the computer on which it is installed. You also need to be concerned with the security on your system.

Web based software lets you login in with an internet connection and you can use any computer anywhere. Web based software tends to less vulnerable to viruses and hackers because of the high security implemented.

Whether you use web based or client based it needs to provide you with real time quotes and the means to quickly buy and sell on the market. If you choose client based software it pays to pay the fee that ensures you software updates because there are regular changes.

Brokers house your client information on two servers in two different locations for security and safety of your data.
So for example if a server has a power failure the data is automatically transferred to the other server and you won’t even realize there was an interruption. Brokers also back up their server using an ongoing system so nothing is ever lost.

You may have found your calling with Forex. There is plenty of money to be made on the currency market. The first step is taking a little risk, the next step is choosing the right Forex trading software, and finally you’ll reap the rewards in profits.

If you’ve invested in the stock market you know what a rush it can be when you come out with profits. The currency markets are much different than the stock market but the rush is even bigger. You’ll want to understand the Forex trading market to help you ensure success.

Forex is short for the Foreign Currency Exchange Market which is also referred to as FX. It is by far the largest market on the planet turning over more than a trillion US dollars a day. That’s thirty times more than the entire volume of all the equity markets in the United States.

What makes the Forex trading market so unique is that it does not have an actual physical location, nor does it have a central exchange. An over the counter market services banks, investors, corporations, and individuals whether they are buying or selling. This is a great example of a true 24 hour market.

Each morning in Sydney the Forex trading market begins, moving around the planet as the business day opens in each of the financial centers – First it goes to Tokyo, then on to London, and then New York.

When dealing on the Forex trading market you can analyze the currency market using either the technical analysis approach or the fundamental analysis.The technical analysis is used when one wishes to attempt to predict what the future movement is going to be on a specific currency based on past performance. It entails studying specific factors that can influence a currency. These factors cold be changes in a Government, a war, a crisis, or several specifics that influence supply and demand which is reflected in the market price.

Fundamental analysis is also referred to as current accounts. They measure the net of imports and exports in any one country and the records the subsequent impact on the currency flows.When it comes to currency trading there is no doubt that Forex or FX is the largest market in the world. Just about every industry is somehow involved in currency trading – banks, multinational corporations, central banks, governments, financial institutes, retail traders, and a variety of institutions all in one way or another directly or indirectly play in the currency market.

Thanks to technology an individual can now set up a Forex trading account and begin to trade without any involvement with a bank or trading institute. There are several excellent online forex trading sites where you can get involved with the Forex trading market and begin trading on your own. The big question is are you ready for the rush when you sell high?

When it comes to trading systems that you can use to trade on the Forex market you have plenty of options but it’s very important to choose the right Forex trading system for you.Some may find fundamental factors easier to take while others will do better with technical indicators. Everyone is different and which system isn’t important – what is important is matching individual to system. So how do you find the right system?

Well it starts with you understanding the methods of analysis that are used when you are trading on the Forex currency market. When you know what the tools are and how to use them you can analyze what is best for you.

Some of the most popular technical analysis tools include pivot points, Fibonacci retraces, chart patterns, candlestick patterns, trade balances, interest rates, and GDP which stands for gross domestic product.

You will need to determine the profitability of the Forex trading system you are considering choosing. Use a real time demo to determine how profitable a trading system is. This lets you begin to understand what the system’s capabilities are and it also let’s you become familiar with the trading platform.

Next you need to have a look at the expectancy which tells you what type of profits you expect to make over a period of time. You calculate expectancy using this simple formula:(Probability of winning × average win) – (Probability of losing × average loss) = the average profit per trade. If this number is a negative number you need to look at a different Forex trading system. Of course the higher the number the better the profits you can expect.

You should also examine the opportunity factor which is just how often you can expect to trade using the trading system. You multiply your expectancy figure with the opportunity factor and it tells you how much you can expect to profit during a specific time period. The more opportunity the more profit you can expect to put in your pocket.

Now that you know how to choose the right Forex trading system for you to reap the most profitability.

Forex trading strategies are the key to successful forex trading or online currency trading. A knowledge of these forex trading strategies can mean the difference between a profit and a loss and it is therefore imperative that you fully understand the strategies used in forex trading.

Forex trading is very different from trading in stocks and using forex trading strategies will give you more advantages and help you realize even greater profits in the short term. There are a wide range of forex trading strategies available to investors and one of the most useful of these forex trading strategies is a strategy known as leverage.

This forex trading strategy is designed to allow online currency traders to avail of more funds than are deposited and by using this forex trading strategy you can maximize the forex trading benefits. Using this strategy you can actually utilize as much as 100 times the amount in your deposit account against any forex trade which will make backing higher yielding transactions even easier and therefore allowing better results in your forex trading

The leverage forex trading strategy is used on a regular basis and allows investors to take advantage of short term fluctuations in the forex market.
Another commonly used forex trading strategy is known as the stop loss order. This forex trading strategy is used to protect investors and it creates a predetermined point at which the investor will not trade. Using this forex trading strategy allows investors to minimize losses. This strategy can however, backfire and the investor can run the risk of stopping their forex trading which could actually go higher and it really is up to the individual trader to choose whether or not to use this forex trading strategy.

An automatic entry order is another of the forex trading strategies that is commonly used and this strategy is used to allow investors to enter into forex trading when the price is right for them. The price is predetermined and once reached the investor will automatically enter into the trading.All these forex trading strategies are designed to help investors get the most from their forex trading and help to minimize their losses. As mentioned earlier knowledge of these forex trading strategies is vital if you wish to be successful in forex trading

Forex trading is buying and selling the foreign currencies of different countries. It has a similarity with stock trading in that the foreign currencies behave like shares of the currency institutions of the countries. Like stock prices, these also move up and down with time-dependent volatility.

It is possible to buy a currency low, buy long and sell short another high currency. It needs meticulous pursuit of the exchange rates of currencies you want to trade. One needs to keep up a continuous scrutiny of the trajectory every particular currency vis-à-vis the other currencies, pair-wise.

It often has leverage enough to induce highly profitable arbitrage and hedging. Each internationally accepted currency has a market and the Forex market is the superset of all these markets taken together. Traders make their own basket or inventory of Forex and trade according to their anticipation of movements.

For example, the primary Forex statistics for the euro in relation to the German mark prior to 1999 reveals a lot of interesting features and profit potential of dollar or German Mark in relation the euro. From the evidence it appears somewhat surprisingly that the euro lost ground against the US dollar in Forex spot trading, and in quite a few dimensions did not match the international transaction role of the German mark.

The euro changed the structure of the Forex market and increased market transparency through currency elimination. This exposed the dealers to higher inventory risks as their respective inventory imbalances became exposed easily to other dealers.

The increased inventory costs were recovered by the dealers in the euro markets through higher spreads. This made the euro a less attractive transaction medium than the German mark. This shows how trading in Forex involves both risk and profit potentials.Earlier, the fore market was the trading ground of millionaires and billionaires only. Now with the introduction of online Forex trading, the average person is able to create amazingly large amounts of wealth from safe online investments in foreign currencies. Online forex trading is nothing but Forex trading transacted through internet links and email through a competent broker.

No technical know how, big "risk", or large investment, hard work is needed. Online forex trading investment lets you use your dollar to control an investment two hundred times as high, $1 to control an investment worth $200, $1000 to control $200,000 and so on and on worth of investment.

Through online forex trading, you are now able to invest your money to fetch more money for you like the millionaires and billionaires, instead of you laboring hard for your money.

Online Forex trading is real fun. It is often the most striking and profitable internet investing opportunity because you can do it from your PC or connected laptop from any place in any country in the world. You don't need any stocks or big inventory in this trading. In online Forex trading, all you do is, just open an account with one of the brokers with as little as $300 or so. Of course, the larger your initial investment, the faster you stand to gain wealth.

Then you simply have to follow simple instructions to purchase and sell the currencies. You buy when the price of the currency is low. Within a few seconds or minutes, the price may go up, and you may sell it and make a profit. This way, by just buying, selling and trading these foreign currencies for about 3 or 4 hrs in a day, you can easily make $500-$1000!

Forex trading is easy money. Especially with the introduction of online trading, it is virtually a continuous upward money spiral for any alert person with a competent broker.

With over $1.5 trillion changing hands daily, it might be advantageous for you to investigate the extremely lucrative business opportunity involving currency trading.Once the domain of major banks and corporations, this field is now an open playground for the ordinary individual.

The following information gives you a comparison of different investment opportunities in comparison to Forex trading Forex could be the perfect opportunity for you if you are willing to have an open mind and investigate.Equities are dependant on variable factors regarding when to buy and when to sell. With Forex, the opportunity to buy or sell is always present.

Futures require a person to pay exchange fees as well as commission charges. Forex requires no commission charges or fees. Futures also is limited to specific trading hours, whereas Forex is not limited and is available 24/7. Also, with Futures, once a person buys they are basically locked in for a specific amount of time. Forex offers flexibility to change position within seconds at the onset of any variable which could effect the particular economic security. When a late breaking news or factor is announced, bam--a trade is made within seconds.

Real Estate can be devastating to the novice and often requires larger amounts of investments. It is also volatile with the factors which can affect the buying and selling. Ask any real estate investor; they all can tell you the horror stories. The emotional strain of a lingering negative tenant is enough to make any investor throw up their hands and run for the hills. An investor may often have money tied up in an investment for several years depending on the situation involved. Although real estate has been up in value for the past few years, many now believe the market has bottomed out and value is growing at a snail’s pace. Many investors often have to wait on approval from banks in regards to financing or releasing money for financing; therefore, an investor may have his money wrapped up long-term. Forex is extremely flexible.CD’s and Savings Accounts offer security but with little return on the investment dollar. With Forex, a sharp trader can often multiply his investment many times over.

Annuities are mostly safe for the long-term, but if an investor needs to pull his money out for the short term, he may have to pay surrender charges which can range as high as 6-8% if withdrawn within the first 6 to 8 years. In his article entitled, “Are Annuities a Worthwhile Investment, Don Taylor, Ph.D., CFA (bankrate.com) states that “most investors would be better off considering annuities as a last resort rather than a first choice when it comes to creating an investment portfolio.

There is a learning curve with Forex; however, the investment in time may pay multiple benefits in terms of investment. There are many avenues to achieve wealth, but few as flexible and lucrative as Forex. With a 24/7 timetable, a person can be in business starting with just a few hundred dollars, the right training and a computer. This flexibility allows a person to work from the comfort of their own home and be in control.

For-ex stands for Foreign Exchange; it is a global market for dealing currencies at floating exchange rates. The foreign exchange is world’s biggest currency market, on an average everyday dollar one to two trillion is traded in the foreign exchange. The trade is mostly done over the internet and telephone lines. Online forex trading is a fast, safe and easy mode of investing. It offers huge returns like twenty to thirty percent every month, yes unbelievable but truth, however that’s only in some cases and you need a lot of experience to be able to extract that amount of interest!

There is no fixed centre for the trade so all the trade is done over telephone, internet and fax. The foreign exchange trade witnessed a massive boom only after online forex trading systems were introduced, internet and telephone has helped the trade grow from $70 billion a day in the 80s to around $1.5 trillion to $2 trillion today.

The currency market is made up of around five thousand institutions most of which are international banks, central government banks, commercial companies as well as big brokers and all these are connected with each other and do business on the go through online forex trading system. The major centers for online forex trading are New York, Frankfurt, London, Paris, Tokyo, Hong Kong, Bombay among others, and all these centers also communicate and deal through online forex trading. The benefits of online forex trading are listed below:

Currency market never sleeps: online forex trading allows you to keep track and deal from anywhere at anytime.- Mini accounts: some websites offer mini accounts that allow you to get started with as less as $200.- No Commission! – Online forex trading is commission free, there’s no exchange or hidden fee either. Your broker earns from the spreads.- Instant: it’s instant unlike offline trade which may involve paperwork.

The nature of the market is such that risk comes inherent and can not be separated but risk can be minimized if you are trading at the right point of time and the right point of time can be anytime only online forex trading allows you to be there at the right time as all other methods as explained above are slow and usually take up a lot of time in processing.

Money management in the foreign exchange currency market requires educating yourself in a variety of financial areas. First, a definition of the foreign exchange currency or forex market is called for. The forex market is simply the exchange of the currency of one country for the currency of another. The relative values of various currencies in the world change on a regular basis. Factors such as the stability of the economy of a country, the gross national product, the gross domestic product, inflation, interest rates, and such obvious factors as domestic security and foreign relations come into play. For instance, if a country has an unstable government, is expecting a military takeover, or is about to become involved in a war, then the country’s currency may go down in relative value compared to the currency of other countries.

There are five major forex exchange markets in the world, New York, London, Frankfurt, Paris, Tokyo and Zurich. Forex trading occurs around the clock in various markets, Asian, European, and American. With different time zones, when Asian trading stops, European trading opens, and conversely when European trading stops, American trading opens, and when American trading stops, then it is time for Asian trading to begin again.

Most of the trading in the world occurs in the forex markets; smaller markets for trade in individual countries. Simply put forex trading is the simultaneous buying of one currency and selling of another. Over $1.4 trillion dollars, US of forex trading occurs daily and sometimes fortunes are made or lost in this market. The billionaire George Soros has made most of his money in forex trading. Successfully managing your money in forex trading requires an understanding of the bid/ask spread.

Simply put the bid ask spread is the difference between the price at which something is offered for sale and the price that it is actually purchased for. For instance, if the ask price is 100 dollars, and the bid is 102 dollars then the difference is two dollars, the spread. Many forex traders trade on margin. Trading on margin is buying and selling assets that are worth more than the money in your account. Since currency exchange rates on any given day are usually less than two percent, forex trading is done with a small margin. To use an example, with a one percent margin a trader can trade up to $250,000 even if he only has $5,000 in his account. This means the trade has leverage of 50 to one. This amount of leverage allows a trader to make good profits very quickly. Of course, with the chance of high profits also comes high risk.People who do forex trading do so because they are attracted by 24 hour trading days, by strong liquidity – unlike stocks, buying and selling is almost instantaneous – and the fact that forex trading usually occurs without paying commissions.

Like many other speculative investments, a key part of money management for the forex trader is only using money that can be put at risk. It is wise to set aside a portion of your net worth and make that the only money you use in forex trading. While the chances of good profits are there, if you should have a problem and get wiped out, you’ll only have a limited amount of money placed at risk. Also remember that the market is n constant motion. There are always trading opportunities. If a currency is becoming stronger or weaker in relation to other currencies there is always a chance for profit. For instance, if you believe that the Euro is gong to become weak compared to the US dollar then selling Euros is a good bet. If you believe that the dollar is going to become weaker than the yen, or the pound sterling, then selling dollars is wise. Staying current on the news and current events in the countries whose currency you hold is a smart move. Many people reach points where they can predict currency changes based on political or economic news in a given country. Remember though that forex trading is speculation, so be careful when managing your funds and only invest what you can afford to risk.

Being new to trading in Forex markets can be a little intimidating. Although many people desire to learn about trading in the Forex, those who begin learning about the trading system find the rules and strategy tactics to be overwhelming at times. While there are rules that you will simply learn along the way, such as price limits and such, there are a few steadfast rules you should know before you make your first move in the Forex market. Use these three rules to help you get started and successfully maneuver throughout the foreign exchange market.Don’t Over Leverage Your Portfolio

When you are just starting out in the Forex, it can be really easy to get caught up in the leverage of the market. The great thing about leverage is that someone who is not investing as much as other larger traders can play with the “big boys†and potentially makes a good profit. An investor can expect to only need to back their investment up to 4% in most cases. This can get some people in trouble however. When you choose to abuse this system, you can end up with a lot of debt. You should never over leverage your portfolio. Be responsible when trading and remember that you are trading larger amounts that you probably have in your portfolio. Keeping yourself grounded is the best way to make sure you use the Forex market to your best potential.

Know When to Quit
Another simple rule for trading in the Forex market is to know when to quit. In turn, this can also mean knowing when to let things stay as they are. There are no way around having occasional trades that have a negative impact on your finances. Not every trade you make will be a hugely successful one. If life were fair, this may not be true, but in the foreign exchange market, where things change by the minute, there is no way to guarantee every trade will reap rewards. Keep in mind that even the most seasoned foreign exchange market traders have bad trades. Your ultimate goal in trading in the Forex should be to try to come out with more wins than losses.

To make it easier to come out ahead at the end of the day, you should always know when to fold on a deal. Never let deals that you know are losing simply happen because you are praying something will change or to save your pride. Be sure to get out losing the least amount of money as possible. This is a strategy every great trader uses. Watch your trades closely so you can get out when you should. If you have researched the trade before, you will know what the breaking points likely are and be able to make this decision easily. Knowing when to leave well enough alone, alone, is another thing you must learn. Learn to be patient with your trades, especially if they are not in a negative position.