Thread: Useful Daily Forex Articles

Automated Forex Trading Systems - Do They Work?

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Nobody minds generating a considerable income on the side. Compared to other investment opportunities, the forex market proves to be a very compelling option for most people. However, many novice traders who enter the forex market often transpire with huge losses and end up leaving the market very quickly. A cursory search about the forex market will reveal to you the many different programs and robots that you can use. Almost all of these programs come with stellar reviews about how they have helped traders generate large sums of money in such a short span of time.

Needless to say, this attracts the attention of the ordinary investor. After all, you can just do your job throughout the day and leave your automated forex trading systems running in the background. When you come home, they will have generated a sizeable profit for you. What could go wrong? Plenty, it seems.

Most people don’t realize that a large number of robots and other automated forex trading systems are simply useless. They are just designed to grab money for customers and to popularize a certain product. What many people don’t realize is that you just can’t get rich without having to lift a hand on your own.

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Everything You Need to Know About ECN Brokers

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The Forex market is an unregulated market in which currencies are traded round the clock. There are millions of traders working with brokers from all over the globe to execute trades. However, there are many different kinds of Forex markets and methods of trading that are currently in use today. If you are a forex trader, you need to know about the Electronic Communications Network (ECN). The Electronic Communications Network is a unique platform that’s designed to facilitate trades between small market participants and larger, tier-1 liquidity providers.

ECN can be defined as forming a link between larger liquidity providers and smaller market participants (traders) with the help of an ECN broker. The role of an ECN broker is integral in this process, since the broker is responsible for facilitating the trade between the traders and the liquidity provider. The link between the ECN brokers, the traders and the liquidity providers is based on the financial information exchange protocol, also known as the FIX protocol.

Many people have said that the Electronic Communications Network is likely the way of the future. There are a few things that you should know about working with ECN brokers though. First of all, it is important to note that the ECN broker charges a fee for every single transaction. The commission fee charged is usually a fixed percentage on every transaction. The trading volume also plays an important role for the ECN brokers. If the trading volume is higher, the broker generates more profit. As a result, most ECN brokers try to maximize their trading volume as much as they possibly can.

There are several advantages of trading with an ECN broker. Here are a few:

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Can Forex Trading be Addictive?

The foreign exchange market is the only global market that remains active round the clock. There are traders active from all parts of the globe who are constantly trading. Due to the difference in time zones, there’s always activity in the forex market. However, according to many forex experts who have lots of experience in the market, forex trading can also be considerably addictive. According to forex psychology experts, it is not easy to wean off a trading habit. Here are just a few reasons why forex trading can be so addictive:

Easy to Trade

Do you own a smart phone and a computer? If you do, you can jump in to the forex market right away. One of the main reasons why so many people end up developing an addictive trading habit is because of the fact that forex trading is so easy. The learning curve is relatively flat, and you don’t need to spend a whole lot of time in understand the different trading strategies or terminologies.

Who doesn’t like making money on the side? Like gambling, forex trading can creep up on you. You might be working at your job and the thought of making a few trades may come in your mind.

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Understand Technical Analysis in the Forex Market

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Most people have this perception that forex trading is all about poring over charts and figures. While that may be true to a certain extent, there are a whole bunch of other things involved. For instance, there are a host of different price action strategies that forex traders use in order to find and execute better deals. Analyzing different deals and figures is much easier said than done. In the past several years, technical analysis has been one of the most hotly debated topics among forex traders.

Technical analysis is essentially a statistical analysis of price changes in the past. The objective of carrying out a technical analysis is to forecast future price changes in the market. In many financial circles, this area has often been met with severe skepticism. Most traders are generally divided in their opinions: some believe that technical analysis actually works, others believe that it’s an absolutely useless tool for predicting changes in the price action and are those who believe that the tool itself is a self-fulfilling prophecy.

The technical analysis today is certainly not similar to how it used to be before. There are plenty of different algorithms and networks that are used by traders in order to carry out technical analyses today.

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Forex practice accounts: a demo to making out the best

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You wouldn’t buy a car without taking it for a test drive first would you? Before making such an important investment you have to carefully study each detail and then make a decision. Firstly you would sort out all of the financial requirements you would need to clarify before purchase. You would study every inch of the exterior and come to know which part of its appearance attracted you the most. You would check the engine and ask intricate questions for each bolt and screw and how exactly they work and how much they meet your expectations. Then you would move on to the interior of the car and look through all its features, which ones are missing, which ones are there and how powerful they are. The last test would is when you would try out the seat, is it convenient, will it make your driving easy and smooth? And most importantly you would check if that chair feels right for you. The exact same logic goes behind getting the best from a forex practice account.

A forex practice or demo account counts as the indicator of looking to invest in a career in forex. Choosing to give it a go marks the way into a newly drawn path and the experience and knowledge gained from this test drive is what will decide if you are ready to become an online forex trader and if you are on your way to successful trading experience.

Your practice account is your first actual contact with the brokerage firm you are thinking about partnering with. Which is why even in demo accounts, the best forex brokers will provide you with enough access to tools and features that will make your experience as real as possible.

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What You Should Know About Leverage in the Forex Market

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Two of the most important concepts that traders need to know are leverage and margin. If you want to become a profitable trader in the market, you need to know about these terms. A margin is the loan given by your broker that allows you to put up your funds and the securities in your account and use them as leverage in order to engage in larger trades.

However, in order to get approval for using margin, you will need to open a margin account. The collateral for the loan is the securities and cash that you deposit in your margin account but the money you borrow to use as margin doesn’t come for free. You will have to pay an interest on the amount that you borrow. In general, you can expect to pay interest rates of anywhere between 5-10% on the margin.

Just like margin, you should know about leverage as well. You can use the margin in order to create more leverage. Simply put, the additional buying power afforded to margin account holders is known as the leverage. In layman’s terms, you will be able to pay less than the full price of any trade, thus making it easy for you to enter much bigger positions, which would not be possible if

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Finding Good Forex Trends - Are There Any Left?

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There are hundreds of different strategies that forex traders use in order to make money in the market. Whereas certain strategies are focused on news, others are focused on trends. Trading on forex trends is easily one of the best and most convenient ways to make money in the market. All you have to do is follow the Forex trends and allow all winning trades to run for as long as they will. If you follow the forex trends strategy, most of the trades you make will be small losing trades. However, every once in a while, you will hit a major wining trade that will offset the minor losses you incurred.

While it may seem pretty straightforward, most traders are unable to perfect this strategy due to several reasons. For starters, trading like this requires a considerable amount of discipline. You will also need to build up a stomach for incurring losses and patiently waiting for one big win. The good thing about following this strategy is that it doesn’t require a whole lot of experience or knowledge. If you know what you are doing, you will be able to make money in the market!

What you need in order to effectively use this strategy is a trend.

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Forex tutorial

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Forex market

Forex market is not a place reserved for wealthy elites, bankers and businessmen who can afford trading currency anymore. Thanks to the advent of the Internet, the forex market is now open to almost everyone with wit and the knack needed to leave a mark in the market. You don’t need to have a very large amount of money with you to become a novice in this adrenaline-releasing market. Most of the times, you would need only your computer, an internet connection, an average sum of money and a completely functional mouse!

Traits of the forex market

When someone mentions the forex market, many people like to envision a place where everything is completely uncertain and losses are great. It is time to change perceptions. The Forex market is not at all about losses and anxiety; it is about making profits within a small period of time, by using the right strategy.

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Why Use Stop Loss Orders?

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efore we talk about the reasons why you should consider using stop loss orders, it is important to understand what stop loss orders really are. Stop loss is basically an order that you place with your broker. If you have a security that you want to make a profit on, the stop loss order will give power to the broker to sell the security as soon as it reaches a defined price. Many forex traders use stop loss orders in order to maximize their profits.

Basically, the purpose of a stop loss order is to minimize the loss incurred by the investor on a particular security. Even though it is mainly used by investors for long positions, stop loss orders can also be executed in short positions. Most people think that professional forex traders should not use stop loss orders. However, here are a few reasons why you should seriously consider using stop loss orders while dealing with your broker:

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A Complete Guide to ECN Trading

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ECN trading has been around for quite a while now. However, most people who are in to ECN trading don’t really know a thing or two about how the platform works. The forex market is one of the biggest trading markets in the world. It attracts traders from all over the world who are interested in buying and selling currencies. If you are trading in the forex market, you already know that there are several different ways by which you can execute your trades. The spreads are fixed, so it is up to you to decide which orders you are going to place.

Obviously, there are numerous things you must consider before selecting which broker to sign up with. One of the best things you can do for yourself is to work with a broker who offers ECN trading. ECN trading is one of the best forms of trading. The Electronic Communications Network allows

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