Forex Training – Tips for Success
Forex training if you have never traded forex markets before you need it! Why?
Because 95% of traders lose because don’t get proper forex education. This article is all about getting the right forex training to win.
The first point to keep in mind is anyone can learn currency trading it’s a learned skill not a gift from god but the vast majority to lose. While forex trading looks easy, it’s not – but if you learn the right information and avoid the myths you can win and win big time. Let me tell you a story to inspire you.
Trading legend Richard Dennis set out to prove that anyone could win at trading and he set about training a group of people, of all ages, both sexes and different levels of education – in just 14 days. He then sent them off to trade – the result of this experiment?
They made $100 million dollars in just 4 years and the rest is history.
So what education did he give them?
The education was based around a simple robust forex trading system (based on breakouts and trend following) which was simple to understand and have confidence in and this was then combined with robust money management.
Dennis however gave them something more – a total understanding of the system and the confidence to apply it with discipline.
You will often here that discipline is the key to success – and it is, because if you don’t have the discipline to apply your method, you really have no method!
Discipline is the key and it comes from within.
If you want to trade you need to learn a currency trading system you can have confidence in, ignore the myths and work smart to get one you’re happy and have rock solid confidence in and then you need to apply it.
The vast majority of forex traders don’t bother learning the right information they try and follow someone else and when losses come they have no confidence and throw in the towel.
They also fall prey to myths that are perpetrated and these are the most common ones:
- To win at forex trading you need to predict prices.
- Day trading makes money.
- Markets move to a scientific theory.
- Buy low sell high is a great way to trade.
- Following a system with a hypothetical track record will make money.
- You can trade expert news stories and win.
ETC
There are many more but these are very common and they all see traders lose.
Getting the RIGHT Training
So what you need to do is get some forex charts and learn how to spot repetitive patterns and some momentum indicators to help you confirm movements and then have the confidence and discipline to execute your trading signals in line with your system.
Finally – do not think discipline is easy pick out some books by the great traders and study what they say. Get yourself a copy of Market Wizards by Jack Shcwager and the disciplined Trader by Mark Douglas and it will really ram home how important discipline is.
The Potential
Well Richard Dennis proved what could be done with the right forex training and if you follow the above you could enjoy currency trading success and build wealth quickly.
Your forex training will determine your success, so work smart not hard, be disciplined at all times and good luck!
Also you can see the video related to forex training
Forex Training Class. We will learn about using the 150 Day Exponetial Moving Average on your Forex charts for your long term Moving Average.We will go over a real life Forex chart and see a good example of the use of this EMA. Risk Disclaimer The past performance of any trading methodology is not necessarily indicative of futures results. No assurance can be given that the recommendations of LP Financial Services will be profitable or will not be subject to losses. All Clients should …
Here some answer the question about forex training
Forex trading training?
Please recommend the best forex trading trainers in the UK and the USA to me.
About Author
PROFESSIONAL FOREX TRADING COURSE
and FREE ESSENTIAL TRADER PDFS
For free 2 x trading Pdf’s with 90 of pages of essential info and more tips on forex training visit our website at: http://www.learncurrencytradingonline.com
Tags: 4X, currency, dollar, Exhange, foreign, forex, fx, money, Trader, training
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August 15th, 2009 at 11:02 pm
I don't know about buying a forex training course when theres so many resources on forex online. Here are some of the sites that i use to teach me more about forex/sharetrading. The websites below have very helpful resources regarding currency trading & theyre all free! I've personally found them very useful in learning about forex trading and its sharetrading counterpart.
August 15th, 2009 at 11:42 pm
My favorite course is http://www.superforexsystem.com/, but you can look for this or any other course on reviews websites like http://www.forextopten.com/.
August 16th, 2009 at 1:17 am
The word FOREX is derived from Foreign Exchange and is the largest financial market in the world. Unlike many markets the FX market is open 24 hours per day and has an estimated $1.2 Trillion in turnover every day. This tremendous turnover is more than the combined turnover of all the wordls' stock markets on any given day. This tends to lead to a very liquid market and thus a desirable market to trade.
Unlike many other securities (any financial instrument that can be traded) the FX market does not have a fixed exchange. It is primarily traded through banks, brokers, dealers, financial institutions and private individuals. Trades are executed through phone and increasingly through the Internet. It is only in the last few years that the smaller investor has been able to gain access to this market. Previously the large amounts of deposits required precluded the smaller investors. With the advent of the Internet and growing competition it is now easily in the reach of most investors.
You will often hear the term INTERBANK discussed in FX terminology. This originally, as the name implies was simply banks and large institutions exchanging information about the current rate at which their clients or themselves were prepared to buy or sell a currency. INTER meaning between and Bank meaning deposit taking institutions normally made up of banks, large institution, brokers or even the government. The market has moved on to such a degree now that the term interbank now means anybody who is prepared to buy or sell a currency. It could be two individuals or your local travel agent offering to exchange Euros for US Dollars. You will however find that most of the brokers and banks use centralized feeds to insure reliability of quote. The quotes for Bid (buy) and Offer (sell) will all be from reliable sources. These quotes are normally made up of the top 300 or so large institutions. This insures that if they place an order on your behalf that the institutions they have placed the order with is capable of fulfilling the order.
Now although we have spoken about orders being fulfilled, it is estimated that anywhere from 70%-90% of the FX market is speculative. In other words the person or institution that bought or sold the currency has no intention of actually taking delivery of the currency. Instead they were solely speculating on the movement of that particular currency.
Source: Bank For International Settlements http://www.bis.org Extract From The Triennial Central Bank Survey of Foreign Exchange and Derivatives Market Activity
Currency19891992199519982001
US Dollar9082.083.387.390.4
Euro….37.6
Japanese Yen2723.424.120.222.7
Pound Sterling1513.69.411.013.2
Swiss Franc108.47.37.16.1
As you can see from the above table over 90% of all currencies are traded against the US Dollar. The four next most traded currencies are the Euro (EUR), Japanese Yen (JPY), Pound Sterling (GBP) and Swiss Franc(CHF). As currencies are traded in pairs and exchanged one for the other when traded, the rate at which they are exchanged is called the exchange rate. These four currencies traded against the US Dollar make up the majority of the market and are called major currencies or the majors.
Market Mechanics
So now we know that the FX market is the largest in the world and that your broker or institution that you are trading with is collecting quotes from a centralized feed or individual quotes comprising of interbank rates. So how are these quotes made up. Well, as we previously mentioned currencies are traded in pairs and are each assigned a symbol. For the Japanese Yen it is JPY, for the Pounds Sterling it is GBP, for Euro it is EUR and for the Swiss Frank it is CHF. So, EUR/USD would be Euro-Dollar pair. GBP/USD would be pounds Sterling-Dollar pair and USD/CHF would be Dollar-Swiss Franc pair and so on. You will always see the USD quoted first with few exceptions such as Pounds Sterling, EuroDollar, Australia Dollar and New Zealand Dollar. The first currency quoted is called the base currency. Have a look below for some example.
Currency Symbol Currency Pair
EUR/USDEuro / US Dollar
GBP/USDPounds Sterling/ US Dollar
USD/JPYUS Dollar / Japanese Yen
USD/CHFUS Dollar / Swiss Franc
USD/CADUS Dollar / Canadian Dollar
AUD/USDAustralian Dollar / US Dollar
NZD/USDNew Zealand Dollar / US Dollar
When you see FX quotes you will actually see two numbers. The first number is called the bid and the second number is called the offer (sometimes called the ASK). If we use the EUR/USD as an example you might see 0.9950/0.9955 the first number 0.9950 is the bid price and is the price traders are prepared to buy Euros against the USD Dollar. The second number 0.9955 is the offer price and is the price traders are prepared to sell the Euro against the US Dollar. These quotes are sometimes abbreviated to the last two digits of the currency such as 50/55. Each broker has its own convention and some will quote the full number and others will show only the last two. You will also notice that there is a difference between the bid and the offer price and that is called the spread. For the four major currencies the spread is normally 5 give or take a pip (will explain pips later)
To carry on from the symbol conventions and using our previous EUR quote of 0.9950 bid, that means that 1 Euro = 0.9950 US Dollars. In another example if we used the USD/CAD 1.4500 that would mean that 1 US Dollar = 1.4500 Canadian Dollars.
The most common increment of currencies is the PIP. If the EUR/USD moves from 0.9550 to 0.9551 that is one Pip. A pip is the last decimal place of a quotation. The Pip or POINT as it is sometimes referred to depending on context is how we will measure our profit or loss.
As each currency has its own value it is necessary to calculate the value of a pip for that particular currency. We also want a constant so we will assume that we want to convert everything to US Dollars. In currencies where the US Dollar is quoted first the calculation would be as follows.
Example JPY rate of 116.73 (notice the JPY only goes to two decimal places, most of the other currencies have four decimal places)
In the case of the JPY 1 pip would be .01 therefore
USD/JPY: (.01 divided by exchange rate = pip value) so .01/116.73=0.0000856 it looks like a big number but later we will discuss lot (contract) size.
USD/CHF: (.0001 divided by exchange rate = pip value) so .0001/1.4840 = 0.0000673
USD/CAD: (.0001 divided by exchange rate = pip value) so .0001/1.5223 = 0.0001522
In the case where the US Dollar is not quoted first and we want to get to the US Dollar value we have to add one more step.
EUR/USD: (0.0001 divided by exchange rate = pip value) so .0001/0.9887 = EUR 0.0001011 but we want to get back to US Dollars so we add another little calculation which is EUR X Exchange rate so 0.0001011 X 0.9887 = 0.0000999 when rounded up it would be 0.0001.
GBP/USD: (0.0001 divided by exchange rate = pip value) so 0.0001/1.5506 = GBP 0.0000644 but we want to get back to US Dollars so we add another little calculation which is GBP X Exchange rate so 0.0000644 X 1.5506 = 0.0000998 when rounded up it would be 0.0001.
By this time you might be rolling your eyes back and thinking do I really need to work all this out and the answer is no. Nearly all the brokers you will deal with will work all this out for you. They may have slightly different conventions but it is all done automatically. It is good however for you to know how they work it out. In the next section we will be discussing how these seemingly insignificant amounts can add up.
More On Market Mechanics
Spot Forex is traditionally traded in lots also referred to as contracts. The standard size for a lot is $100,000. In the last few years a mini lot size has been introduced of $10,000 and this again may change in the years to come. As we mentioned on the previous page currencies are measured in pips, which is the smallest increment of that currency. To take advantage of these tiny increments it is desirable to trade large amounts of a particular currency in order to see any significant profit or loss. We shall cover leverage later but for the time being let's assume we will be using $100,000 lot size. We will now recalculate some examples to see how it effects the pip value.
USD/JPY at an exchange rate of 116.73
(.01/116.73) X $100,000 = $8.56 per pip
USD/CHF at an exchange rate of 1.4840
(0.0001/1.4840) X $100,000 = $6.73 per pip
In cases where the US Dollar is not quoted first the formula is slightly different.
EUR/USD at an exchange rate of 0.9887
(0.0001/ 0.9887) X EUR 100,000 = EUR 10.11 to get back to US Dollars we add a further step
EUR 10.11 X Exchange rate which looks like EUR 10.11 X 0.9887 = $9.9957 rounded up will be $10 per pip.
GBP/USD at an exchange rate of 1.5506
(0.0001/1.5506) X GBP 100,000 = GBP 6.44 to get back to US Dollars we add a further step
GBP 6.44 X Exchange rate which looks like GBP 6.44 X 1.5506 = $9.9858864 rounded up will be $10 per pip.
As we said earlier your broker may have a different convention for calculating pip value relative to lot size but however they do it they will be able to tell you what the pip value for the currency you are trading is at that particular time. Remember that as the market moves so will the pip value depending on what currency you trade.
So now we know how to calculate pip value lets have a look at how you work out your profit or loss. Let's assume you want to buy US Dollars and Sell Japanese Yen. The rate you are quoted is 116.70/116.75 because you are buying the US you will be working on the 116.75, the rate at which traders are prepared to sell. So you buy 1 lot of $100,000 at 116.75. A few hours later the price moves to 116.95 and you decide to close your trade. You ask for a new quote and are quoted 116.95/117.00 as you are now closing your trade and you initially bought to enter the trade you now sell
August 15th, 2009 at 10:58 pm
I have a collection of forex autopilot trading videos. Have used myself and found them very profitable. Just want to share with you. Click on my account to see the videos.
August 15th, 2009 at 11:46 pm
well done…
August 18th, 2009 at 5:54 am
It is both. I would still saying the same things about robot, NO robot can consistently beat the market in the long run. Learn forex trading the hard way and you will gain from it.
August 18th, 2009 at 9:25 am
You can probably look for on a reviews website and read what people think about each software.
For Forex I personally like Supra Forex.
August 18th, 2009 at 4:36 am
i can’t join because of money issues but when i settle my bills i will likely subscribe..
August 18th, 2009 at 9:41 pm
Some articles written in simple english that might be helpful for newbie:
http://www.forex2u.com/forex-articles.html
http://www.forex.labuan.net/
http://www.118forex.com/
August 18th, 2009 at 11:57 pm
August 19th, 2009 at 9:24 am
Well, I didn't know too much a couple of months ago when i started in forex, i used a software that actually do the trades for me, maybe you cannot find it in some torrent because it's a personal password, you have to download it directly from the site http://www.robot4trade.com you can do an effort and buy it, it worth the price, it cost me $99.00 dlls when it was in back-testing, i heard the price is going up because of the excellent results, i fully recommend it to you and anyone
have a good day!