Saturday, February 9, 2013

Three Mistakes to Avoid in Forex Trading


It is a reality that Forex Trading can aid you to earn good money. Still, something that offer many chances for success can also be a failure trap. This also applies in the Forex Trading case,  a lot of monetary profits bide you, but pay attention, because any mistake will affect you. In this branch are a lot of mistakes, but you can slightly fix them. Below are some tips that will help you in this case.

1. Unrealistic Expectations 


Most people are joining in Forex Trading, because they heard that a friend got wealthy in a short period or something similar. Nevertheless, in Forex Trading, luck plays an important role. Imagining that you will make a lot of money in a context of few days from Forex Trading is not believable. You can count on your fingers the people who have enriched by pure luck, instead others had to work a lot and for a long time. Entering the trade world with a high hope, would mean that you put yourself in front of a big disappointment.

2. Following a Routine 


In Forex Trading, a good tactic, that you can follow, is that you always should alter your routine. If a strategy works today, does not mean that it will always work. Staying stick to a routine, means that you are attempting to play safe, and this will deprive you from full earnings potential. If you want to be one of the successful Forex Traders, you need to learn  to take risks, and upgrade your strategies and routines with the times.

3. Going For Broke 


Many people believe in it, but it can bring you a lot of troubles, in Forex Trading. When you play more money in the Forex Market, the potential income grow, but on the other hand, involve more risks. If you  deposit all your money into a few trades, you stand to lose everything, so if your decisions will be wrong, you won't have any money to make other transactions. When you start, you must study the Forex Market, and choose which transactions you go.


Try to stay away from these mistakes, because at some point you will give up. It's difficult to get up from a major mistake, so play wisely, and don't deposit more than you own.

Friday, February 8, 2013

Forex Currencies in 2013


This year we will notice major Forex moves, as currencies have been under push last year. The EUR/USD has waned due to the fact that the GBP/USD is growing suddenly, after a radical decline a few years ago, and the EUR/AUD further go down.

EUR/USD


Europe has problems, and the proof is poor performance that Euro had in the Forex Market. After reaching all time high, for the second time in 2011, Euro has been waning and will continue likewise, this year. Angela Merkel said that Europe will start to grow again in 2013, but I suppose it will happen barely after 2016, with all the austerity which last until it start working. Even with debt relief, there will not be any miracles. Meanwhile, United States are getting more powerful, even if their national debt is continually growing.

GBP/USD


After an awful wane a few years ago, the GBP/USD succeeded to be traded at a new relative high of 1.60, it should persist this way. Great Britain is stronger than the United States, in the economic field, and it will continue that path for a couple of years. The GBP is a currency to buy and keep for one or two years. If you did that last year, you should have your revenue doubled.

EUR/AUD


Since Europe is stronger than Australia, 27 states compared with one, this currency will still decrease, as before, actually. Also, the interest rates do it outstanding to short this pair and gain money daily. You gain money when the currency fall and you gain money from the daily interest.


As you can see, this year, the Forex market offers a lot of opportunities. As a hint, I suggest you to start a couple of real accounts, applying  varied strategies for each of them.

Thursday, February 7, 2013

The Currency at Forex Market [PART2]


The point or pip


The point or pip, is the lowest alter of price, one teen thousand of a price.
USD/CHF=1.2401 ——–> 1.2402
EUR/USD=1.2400  ——–> 1.2401
GBP/USD=1.8200  ——–> 1.8201
And if you remark that the Swiss Franc has increased from 1.2401 to 1.2402, you are able to say that the Swiss Franc has grown up one point/one pip.

Leverage


Depositing 200$, using a 1:100 leverage, you have a buying power of 20 000$. How does the system run?
If you get a profit, it's wholly yours, but if you lose, it will be your loss, too. You got to restrict your risks and secure yourself by placing orders. Don't forget that you are in control, but more about this later.

When to buy and sell


The most significant thing that you have to know is, once and for all, the point in which you should buy and sell foreign currency unconcerned of what the currency pair is.
Like I specified in the previous post, you are able to sell something that you do not possess. Your business is to identify correctly the market downwards or upwards. That’s it. Think that you are a consultant. The only job is to foretell, if the price goes down or up.

Tuesday, February 5, 2013

The Currency at Forex Market [PART1]


Before you learn advanced forex trading strategies you need to understand the basics.
Without knowing how to earn 100$ per day, you can't learn how to earn 1000$ per day.

The Five Currencies


The value of the currency is determined by examining and determining, how far the national economy has improved and issuing state’s ability to satisfy its financial obligations. Almost all international transactions are carried out in five currencies, nowadays:

American Dollar, USD or $
European Currency Unit or Euro, EUR or €
British pound or Pound Sterling, GBP or £
Japanese Yen, JPY or ¥
Swiss Franc or “safe cover currency”, CHF or ₣

The currency quotation


Earlier, once international trade used silver and gold coins, the national provenance of these coins were not relevant, in distinction to the weight and the hallmark of the coins. Gold has no nationality, it’s welcome everywhere. When paper money was began to be used it had been needed to count its relative value, so the phrase, one unit of foreign currency, in terms of the national currency, it's used to be called currency quotation.

What is a currency pair?


In the present it’s accepted that, the value of the prime currencies is measured in US dollars, so, with the five currencies we cited earlier, we have four pairs:

USD/CHF

USD/JPY

GBP/USD

EUR/USD

In the currency pair, the first currency is the one we can buy and sell. The second one is the currency wherewith, we buy and sell. Thus we have:

USD/CHF = 0.9091
0.9091 CHF for 1$

Meaning that today it’s required to pay 0.9091 CHF for 1$

USD/JPY = 93.38

Today, for 1$ you will get 93.38¥

The base currency is the first one, from the currency pair. The US dollar is the base currency for the most currencies exchanges. Japanese Yen, Canadian Dollar, Swiss Franc … There are any currency pairs where US dollar is not the base? Yes, and the explanation would be: ambition and tradition. The British pound which is 1000 years old, the oldest currency in the world, is the base currency in pair GBP/USD. With the advent of Euro, slowly it began to be the base currency in the pair with the USD dollar.

Saturday, February 2, 2013

How the Forex Market Works


To make cash on the stock market you would like to grasp few principles governing the market. Understanding the concept of the forex market and the correct mindset is worth more than ten times in comparison with using the best forex trading methods. The stock exchange in many ways is like the traditional trade at the fairs. Focus and inform the brief history of the stock market to find out in which way the barter has progressed to what's referred to as foreign currency exchange. Notice that nowadays the money has become a commodity.

Brief History of Forex Market


1.The Stock Exchange


If you are reading this it means that you decided to profit a bit more about forex trading (stands for foreign exchange trading). The actual stock exchange is the top form of long progress of global trade. Merchants and traders evolved from working in caravans and loud bazaars, up to stock exchanges organizations.
In the Middle Ages, merchants used to meet only in established places, (fairs or markets) once a year. But nations have developed new trade routes, were discovered new continents  and new products become available in the market. In major seaports, like Antwerp, trading started to take place every day. At first, in the open air, and later in buildings particularly designed for this goal.
In 1531 at Antwerp, was opened one of the first European Stock Exchanges. Over years, was introduced a set of rules, governing exchange trading, and in the most developed nations in economic, these rules were adopted in the law.


2.The Global Currency System 


The Second World War has not only affected the political balance of power, it also has left both Japan and Europe in ruins. In 1944, financial representatives of the Allies had met in Bretton Woods, USA to analyze the problem of post war economic mechanism and the regeneration of the global economy. Due to this, the International Monetary Fund was establish. Now the US dollar has managed to take lead before British pound as the World’s currency. It has prevailing international payments since the middle of the 19th century.
By the early 70s, the global economy began to grow. Germany and the Japan, which were defeated in the war, have developed into the economic powerhouses. In 1971, the Bretton Woods accords were temporarily suspended. By 1979, a floating currency system was set.
Prices of today metals, international debts and petroleum are still in US dollars, because several years after the War, there were no options. The US Dollar is the World’s reserve currency, because of the key role which the Bretton Wood Agreement played in post war reconstruction and because the US has the biggest economy in the world.
The times are changing. In 1999, twelve European countries, quit their national currencies and created a new single European currency, the euro. Without any doubt it was a try to create an alternative global monetary unit.


3.Money as a Commodity 


It’s feasible to buy and sell cash for cash just like any other product. The payment for cash is the interest rate which the seller receives. At the main level, when you deposit the cash into your bank account, you are the seller and the bank is the buyer. The bank pays you interest for use of your cash. The Money Markets were set up to trade with cash. The participants of this market give or take money for a period of time in the interest rate. The banks , the companies and the State, buy and sell money in a form of bills, certificates of deposit and so on. These transactions are done in the national currency. So that, national currencies began to go on sale for foreign money. This way, money are treated like a product. An exchange product.