Forex Forums  

Go Back   Forex Forums > Forex Forums > Forex Training

Reply
 
LinkBack Thread Tools Display Modes
  #1 (permalink)  
Old 11-29-2009, 04:15 PM
Junior Member
 
Join Date: Nov 2009
Posts: 2
Lightbulb FOREX trading - a business or a gamble?

FOREX is an acronym for FOReign EXchange, an international currency market where money is bought and sold. Established in 1971 when floating exchange rates began to materialize. There is no centralized location for trading in FOREX, yet it is the world's largest and deepest market. Daily turnover has risen fromapproximately 5 billion US Dollars in 1977 to 1.5 trillion US Dollars today (Source: Bank Of International Settlements). The FOREX is a group of over 4,500 currency trading institutions. The bulk of FOREX trading is between approximately 300 large international banks that process transactions for large companies and governments. They provide exchange rates for each other and the broader market. The most recent quotation from one of these banks is considered the market's current price for that currency. Until recently, the FOREX inter-bank market was not open to the small speculator, today the small speculator can trade in this primary market. All trades are calculated on a very sophisticated computer system via the internet and market Brokers. Most FOREX activity consists of spot business between US Dollars and Six major currencies (Yen, Euro, Pound, Franc, Canadian Dollar and Australian Dollar). It would take the New York Stock Market about 3-4 months of daily trading to equal one day of trading in FOREX. Trading in FOREX provides the highest profit of all legal business operations.

One important thing you must know about FOREX trading is that a rational trader orders a BUY when he believes the price will rise, and orders a SELL when he believes the price will fall, therefore you should operate this principle of ''Buy Up; Sell Down''. The main problem of a trader is not based on theories of FOREX, but the problem comes from the issue of "which strategies to use'' and ''which one works best''. Beware, every style of trading has its risks, but of different degrees. Your main work in trading is to try as much to minimize the risk in a strategy you have built up. This is the beauty of technical analysis approach to FOREX in that you trade what you see and not what you don't see as opposed to fundamental analysis-you see the trend and ride it...but the right time to start riding the trend is another knowledge which differenciates traders from learners. Research is highly recommended for beginner traders.

Technical trading involves technical indicators usually, but using them should not cloud the accurate judgement of price direction -since price direction is the ultimate goal of a trader. Now where is price headed? We'll be getting the answers to this question as we examine how most of the MT4 indicators behave in relation to price moves.

For a technical trader, technical indicators are the easiest tools to use practically. One major set-back is that many of them 'lag' i.e. they signal after price change and not before price change as would be expected. Therefore experience has shown that merely following their 'buy' & 'sell' signals is sometimes risky and inconsistent. To choose indicators wisely for trading, you need to know the classification of indicators.

MT4 CLASSIFICATION OF TECHNICAL INDICATORS

TREND:- ADX, BollingerBands, CCI Moving Average, Parabolic SAR, Standard Deviation.

OSCILLATORS:- DeMarker, ATR, Bears Power, Bulls Power, Envelopes, Force Index, Ichimoku, MACD, Momentum, OsMA, RSI, RVI, Stochastic Oscillator, Williams %Range.

VOLUMES:- OBV, Accumulation Distribution, Money Flow Index, Volumes.

BILL WILLIAMS:- Accelerator Oscillator, Alligator, Awesome Oscillator, Fractals, Gator Oscliiator, Market Faccilitation Index.

POPULAR CLASSIFICATION OF INDICATORS

TREND (Identify trend and price direction):- MACD, Parabolic SAR, Moving Average, CCI, Trix Indicator.

MOMENTUM (Tells speed of price change, overbought/oversold conditions and start of trend):- RSI, Stochastics, CCI, Momentum Williams %Range.

VOLUMES (Strength of price move and trend strength):- Force Index, Money Flow Index, Volumes, OBV.

VOLATILITY (Tells strength of trend and breakout):- Bollinger Bands, ATR, Envelopes.

Some indicators are classified as 'leading' indicators -they signal before trend (RSI, Stochastics, Parabolic SAR); and others classified as 'lagging' indicators -they signal after trend (Moving average, MACD, BollingerBands).

Most trading techniques are classified into 'Swing Trading' (1 hr - 1 day) and often fail during some news releases; others fall into 'Scalping Trade' (1 min - 30 min) and often fail when there is a reasonable trend move.

When interpreting volume based indicators, be careful not to relate their interpretation to volume of the market itself because there is no centralized market location as to ascertain the correct market tick volume; volume data supplied to your terminal only form a small sector of the total volumes in this huge market. Rather volume based indicators should be used to watch divergences.
Reply With Quote
  #2 (permalink)  
Old 01-02-2010, 11:12 AM
Senior Member
 
Join Date: Jul 2009
Posts: 105
Default

Hello,

It's a mind game and you can realize this once you entered into the Forex trading platform, if you make your trades rationally and intelligently you will find the difference in between yourself and those who are making trades just considering it as the gambling.

Because rational approach towards making trades will help you to make profitable returns.
It's not at all gambling and take it seriously as it involves real money investment.
Reply With Quote
  #3 (permalink)  
Old 01-22-2010, 09:51 AM
Junior Member
 
Join Date: Jan 2010
Posts: 7
Default

Forex trading is not a gamble its a mind game. To sum it up, forex trading is a profitable real business for those who have the patience to learn the nitty-gritty of it. If you dont have that patience, please find another trade!
__________________
Forex ea
Reply With Quote
  #4 (permalink)  
Old 02-16-2010, 07:02 AM
Senior Member
 
Join Date: Jul 2009
Posts: 105
Default

Quote:
Originally Posted by forextrading View Post
Forex trading is not a gamble its a mind game. To sum it up, forex trading is a profitable real business for those who have the patience to learn the nitty-gritty of it. If you dont have that patience, please find another trade!
Exactly!
Patience is the most important thing a trader should have while trading. It is one of the best advice we can give to a newbie in forex trading.
Reply With Quote
  #5 (permalink)  
Old 03-12-2010, 06:10 AM
Junior Member
 
Join Date: Mar 2010
Posts: 7
Default

forex trading is a profitable real business for those who have the patience to learn the nitty-gritty of it.
Reply With Quote
  #6 (permalink)  
Old 03-16-2010, 09:25 AM
Senior Member
 
Join Date: Jul 2009
Posts: 105
Default

Quote:
Originally Posted by donatexx2008 View Post


MT4 CLASSIFICATION OF TECHNICAL INDICATORS

TREND:- ADX, BollingerBands, CCI Moving Average, Parabolic SAR, Standard Deviation.

OSCILLATORS:- DeMarker, ATR, Bears Power, Bulls Power, Envelopes, Force Index, Ichimoku, MACD, Momentum, OsMA, RSI, RVI, Stochastic Oscillator, Williams %Range.

VOLUMES:- OBV, Accumulation Distribution, Money Flow Index, Volumes.

BILL WILLIAMS:- Accelerator Oscillator, Alligator, Awesome Oscillator, Fractals, Gator Oscliiator, Market Faccilitation Index.

POPULAR CLASSIFICATION OF INDICATORS

TREND (Identify trend and price direction):- MACD, Parabolic SAR, Moving Average, CCI, Trix Indicator.

MOMENTUM (Tells speed of price change, overbought/oversold conditions and start of trend):- RSI, Stochastics, CCI, Momentum Williams %Range.

VOLUMES (Strength of price move and trend strength):- Force Index, Money Flow Index, Volumes, OBV.

VOLATILITY (Tells strength of trend and breakout):- Bollinger Bands, ATR, Envelopes.

Some indicators are classified as 'leading' indicators -they signal before trend (RSI, Stochastics, Parabolic SAR); and others classified as 'lagging' indicators -they signal after trend (Moving average, MACD, BollingerBands).

Most trading techniques are classified into 'Swing Trading' (1 hr - 1 day) and often fail during some news releases; others fall into 'Scalping Trade' (1 min - 30 min) and often fail when there is a reasonable trend move.

When interpreting volume based indicators, be careful not to relate their interpretation to volume of the market itself because there is no centralized market location as to ascertain the correct market tick volume; volume data supplied to your terminal only form a small sector of the total volumes in this huge market. Rather volume based indicators should be used to watch divergences.

That was indeed pretty interesting thing to read, i have recently shifted over to MT4 Trading and use of those indicators will certainly help me make positive trades.
Reply With Quote
  #7 (permalink)  
Old 05-14-2019, 03:28 AM
Senior Member
 
Join Date: Sep 2016
Posts: 280
Default

Forex is a lovely business but only if we trade in proper way without doing anything silly. And of course, we also need to have quality broker. This is what I have with me in FreshForex, they are worlds best with having 101% Tradable Deposit Bonus, and something that only makes life easier for each and everyone!

Reply With Quote
Reply

Tags
business, cash, indicators, money, trade


Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are On
Pingbacks are On
Refbacks are On




All times are GMT. The time now is 02:07 PM.


Powered by vBulletin® Version 3.8.5
Copyright ©2000 - 2021, Jelsoft Enterprises Ltd.
Search Engine Friendly URLs by vBSEO 3.1.0 ©2007, Crawlability, Inc.