Forex Trading, Mini Accounts, Online Forex Trading System

This is the final part of forex trading mini course from Peter Bain.

29 favourite Forex Trading Tips:

1. Initially set a goal of 20 pips a day

2. Use MACD: divergence; otherwise, it just
confirms the trend.

3. 20-30 pip stop losses - but on the other side
of event that caused you to take action.

4. Specialize in one currency pair.

5. Keep a log.

6. Sit on your hands unless you “SEE” something
concrete to do.

7. This is NOT about scalping.

8. OHLC at midnight ET.

9. Don’t buy too soon in a downtrend;
don’t sell too soon in an uptrend;
currencies trend well.

10. Average trading range (ATR) usually
fulfilled starting at 3 am ET.

11. Forget trading retracements when
you catch the main trend.

12. Four things to watch out for …
to be discussed later.

13. Single versus multiple lots.

14. NO MAN’S LAND - except where
you see ironclad signals like
bar/candle/chart patterns,
multiple bottom/top, MACD
divergence, trendline break.

15. You don’t need to draw
pivot points. If you do, they
don’t have to be exact.

16. Green lights. (Don’t wait
of all the lights to turn
green, it will seldom happens)

17. Learn, paper trade, demo, live.

18. Look at lower-level chart
when price is at a pivot point
and moving fast.

19. Automated systems kick in
at pivot points; therefore,
lots of follow-through.

20. Learn to react to shades of gray.
Trading is an art - not a science.

21. M1/M3 and M2/M4 - like
early warning radar, but not
cast in stone; S can become
R, and R can become S.

22. Buying below the central
pivot point and selling above
the central pivot point can
be influenced by signals
like bar/candle/chart
patterns, multiple bottom/top,
MACD divergence, trendline break.

23. If bias is to be short,
think short - not long; if bias
is to be long, think long; go
one way or the other, but not
both. Try hedging.

24. Use standard default settings
for indicators.

25. Do not trade holidays, Mondays,
month-end, quarter-end, year-end.

26. Repeat after me, “The trend is your
friend.” If the trendline holds, buy the
dips in an uptrend, and sell the
rallies in a downtrend. Currencies
trend WELL! In an uptrend, don’t look
to go short; in a downtrend, don’t
look to go long.

27. No volume figures; but, a very
liquid market.

28. Take your signals off higher-level
charts, unless you see something
concrete at the lower level. Remember,
the five minute chart is your ‘trim tab.’
It is not to be used for scalping!
Use the 5 min to spot price reversal
situations, where price is on a tear,
and/or where price is moving quickly
in and around a pivot point. You
won’t know what hit you on the 15 min
in such situations.

29. Any one indicator like a hammer
or spinning top may not be enough
ammo to pull the trigger. Look
around for more evidence of an
impending shift in price direction.

Learn to trade foreign currencies with Peter Bain Video ForEx Course

Recognition and Pivot Point AnalysisÂ

Forex Video trading course shows how to combine chart pattern
recognition with Pivot Point analysis to produce
extremely profitable results. Here is an overview:

I personally like to focus on a small number of the more consistent,
reliable and re-occurring formations. The ones
I am particularly interested in are the powerful reversal formations at
tops and bottoms of price ranges.
When chart pattern recognition skills are applied with the use of the
Pivots Program, benefits accrue. The targeted support and
resistance numbers are like an early warning system. Being aware of an
important price target level, accompanied by a pattern, you
can then anticipate your move.

Specifically, the pivot point calculations give an early warning
signal, and chart formations confirm potential
buying or selling opportunities. Formations like triangles and wedges
are instrumental in helping you take action.
Having access to support and resistance numbers, plus combining the
bullish or bearish patterns, facilitates identifying
bankable trades.

For example, even if you were not convinced that a downtrend would
hold, then at least the “breakout” from a symmetrical triangle
pattern in a downtrend would have enabled you to capture a portion of
the ensuing decline.
Bullish and bearish pattern recognition helps you get in at bottom and
top price reversals.

Armed with these indications, combined with pivot points, this will
provide a wealth of signals in order to develop a proper
game plan. At the very least, it will keep you from buying the high or
selling the low.Learn to trade foreign currencies with Peter Bain Video ForEx Course

Peter Bain’s Forex Trading System is extremely simple and yet
highly effective. Below is a brief preview.

The full video course describes the system in detail.

WHAT YOU NEED TO GET STARTED

1. A computer, Internet connection,
2. A system to trade with such as my Pivot trading system.
3. A funded account at a forex market maker broker

You only need a few tools to locate profitable set-ups:

- Price
- Price Bars,
- MACD Divergence
- Pivot Point
- Breakout/test/violations
- Trendline breakout

That and of course your passion to succeed
is all it takes in this wonderful business
of Forex trading.

No other bells and whistles or toys are
required - contrary to what you may have
learned before.

The hardest part for you will be to
“unlearn” all the nonsense you’ve been
fed about trading prior to coming here.
(Just give your head a good shake;
maybe it will go away).

CHARTS

I use mainly daily, hourly, 15 minute,
and five minute charts. The daily chart
will help you define the overall trend
from a position trading point-of-view,
and the hourly chart will give you a
feel for the intraday trend.

The 15 minute chart is used for entry
and exit - with assistance from the five
minute chart, where price is moving
quickly, and you need to be closer to
the action. Please note that the five
minute is not to be used for scalping,
as there is a lot of noise there,
and you could easily get whipsawed.

Make sure you are using charts that
are generated from the same data source
that feeds the dealing engine, as is
the case with both platforms mentioned
above. That way, what you see is what
you get when you buy or sell. Some
charting packages do not accurately
reflect where price is at any given
moment in time.

PIVOT POINTS

My trading system is based on pivots.
Pivot points are targets, or mile markers,
used for assessing price movement and
determining direction.

If you’re unfamiliar with pivot points
and how I use them, below is an overview.

Used by professional floor traders, pivot
trading is one of the oldest and most amazing
technical trading methods available.

Professional traders calculate pivot points
in preparation for each trading sessions.
The pivot lines system is an indispensable
guide for making profitable decisions.

For an active trader, the pivots can mean the
difference between winning and losing.

The Pivot techniques work well in markets with
a wide daily trading range, such as the Forex.
Pivot lines steers traders away from “no man’s
land” and identifies “high activity” areas in
which the equity has a high probability of
reversal. These areas are important trading zone
watched daily by floor traders and computer
trading systems.

The levels for the trading ranges and pivots
are the support and resistance levels of the
market in the next time interval.

It is important to note that the predicted
levels only give the range in the next time
interval. They do not indicate when the levels
will be reached by the currency price action.

The pivot is a level at which the underlying
asset can be expected to change direction
and/or move rapidly away from.

My pivots program provides not only Pivot,
R1, R2, S1, and S2, but also the M1, M2, M3,
and M4 points as well. It is common to find
many traders calculating only the Pivot, R1,
R2, S1, and S2 levels. In the Forex market,
however, you will find my additional points
of support and resistance to be very significant
indeed.

The Forexmentor video course shows you how
to calculate the Pivot points using our
proprietary Pivot Calculator.

After you have calculated the pivot numbers
for the day, place horizontal lines on
your 15 minute and 1 hour charts at the
pivot numbers for the day, or at least as
many lines as your chart has room for.

These pivot points will guide your trading
throughout the day.

INDICATORS

I really only espouse one - MACD
(for divergence only).

MACD Divergence is covered extensively
in my course and my trading examples

MACD is my favorite indicator, and that
would be my choice. The nine and 18
exponential moving averages are okay
too to give you some sense of price
direction, but I am not a believer in
using moving averages for this market
- so am not too thrilled about their
application and use.

Go ahead and plot MACD on the charts
you are working with.

Learn to trade foreign currencies with Peter Bain Video ForEx Course

The currency (foreign exchange) market
is the largest and oldest financial market
in the world. It is also called the foreign
exchange market, or “FOREX” or “FX” market
for short.

It is the biggest and most liquid market
in the world, and it is traded 24 hours-a-day .

The forex market is a cash (or “spot”)
inter-bank market. By comparison, the
currency futures market is only one per
cent as big.

Foreign Exchange simply means the buying
of one currency and selling another at the
same time. That’s it!

In other words, the currency of one country
is exchanged for those of another. The
currencies of the world are on a floating
exchange rate, and are always traded in
pairs - Euro/US Dollar, US Dollar/Yen, etc.

In excess of 85 percent of all daily
transactions involve trading of the major
currencies:

- US Dollar,
- Euro
- Australian Dollar,
- British Pound,
- Canadian Dollar
- Japanese Yen,
- Swiss Franc

Unlike the futures and stock markets,
trading of currencies is not centralized
on an exchange.

Forex literally follows the sun around
the world. Trading moves from major banking
centres of the U.S. to Australia and
New Zealand, to the Far East, to Europe
and finally back to the U.S.

In the past, the forex inter-bank market
was not available to small speculators
due to the large minimum transaction
sizes and often-stringent financial
requirements. Banks, major currency
dealers and the occasional huge
speculator used to be the principal
dealers. Only they were able to take
advantage of the currency market’s
fantastic liquidity and strong trending
nature of many of the world’s primary
currency exchange rates.

Today, foreign exchange market maker
brokers are able to break down the larger
sized inter-bank units, and offer small
traders the opportunity to buy or sell
any number of these smaller units (lots)
form their PC’s

These brokers give virtually any size
trader, including individual speculators
or smaller companies, the option to trade
the same rates and price movements as the
large players who once dominated the market.

Market makers quote buying and selling rates
for currencies, and they profit on the
difference between their buying and
selling rates.

===How the Retail Spot Forex Works===

When you use retail spot Forex software,
it only requires an internet connection to
trade real-time. No extra data-feed is required.

All online Forex brokers’ software is real-time,
rather than delayed. If you download a free
30-day demo of the software, you can “practice
trade” in real-time with the exact same quotes
as a live account. The software is exactly the
same, and you receive virtual money for the
account.

You are then able to enter trades in real time,
and monitor them just as though it were a
real account.

You will experience no difference between the demo
account and a live account. When you log onto your
trading platform, you see your price quotes, and you
simply click on the price to sell or buy. It will ask you
how many lots or contracts you want, and then you
click ok, and you are in.

You can also use the charts they provide with the
trading platform; they will reflect the movement of
the real-time price of their trading platform.
With those charts, you usually have the ability to
place horizontal lines where you choose (pivot numbers).

Each currency is quoted with a “pip spread“. This is
how the dealer makes his money. With most online
retail brokers, there are no commissions. For example,
I want to buy the Swiss Franc, and the current quote is
1.7205/1.7210. The dealer will give me the 1.7210 price,
and I would start the trade -5 points which equals $30.00
(for a stand lot).

In my trade window, I would see my money change as the
market price moves back and forth. As it moves in my
favor, my negative position is removed as soon as the
market is trading 1.7210/1.7215, or higher.

In the spot forex market, it is common for currencies
to move 100 to 300 pips/points in a 24-hour session.

If you like volatility, there is no currency more volatile
than the Franc.

Learn to trade foreign currencies with Peter Bain Video ForEx Course

Currencies are traded in dollar amounts called “lots”. One lot is equal to $1,000, which controls $100,000 in currency. This is what is known as the “margin”. You can control $100,000 worth of currency for only 1,000 dollars. This is what is called “High Leverage”.

Currencies are always traded in pairs in the FOREX. The pairs have a unique notation that expresses what currencies are being traded. The symbol for a currency pair will always be in the form ABC/DEF. ABC/DEF is not a real currency pair, it is an example of a symbol for a currency pair. In this example ABC is the symbol for one countries currency and DEF is the symbol for another countries currency.

Here are some of the common symbols used in the Forex:

USD - The US Dollar
EUR - The currency of the European Union “EURO”
GBP - The British Pound
JPN - The Japanese Yen
CHF - The Swiss Franc
AUD - The Australian Dollar
CAD - The Canadian Dollar

There are symbols for other currencies as well, but these are the most commonly traded ones.

A currency can never be traded by itself. So you can not ever trade a EUR by itself. You always need to compare one currency with another currency to make a trade possible.

Some of the common PAIRS are:

EUR/USD Euro / US Dollar
“Euro”

USD/JPY US Dollar / Japanese Yen
“Dollar Yen”

GBP/USD British Pound / US Dollar
“Cable”

USD/CAD US Dollar / Canadian Dollar
“Dollar Canada”

AUD/USD Australian Dollar/US Dollar
“Aussie Dollar”

USD/CHF US Dollar / Swiss Franc
“Swissy”

EUR/JPY Euro / Japanese Yen
“Euro Yen”

The listed currency pairs above look like a fraction. The numerator (top of the fraction or “left” of the / however you want to SEE it) is called the base currency. The denominator (bottom of the fraction or “right” of the /however you want to SEE it) is called the counter currency. When you place an order to buy the EUR/USD, for instance, you are actually buying the EUR and selling the USD. If you were to sell the pair, you would be selling the EUR and buying the USD. So if you buy or sell a currency PAIR, you are buying/selling the base currency. You are always doing the opposite of what you did with to base currency with the counter currency.

If this seems confusing then you’re in luck. You can always get by with just thinking of the entire pair as one item. Then you are just buying or selling that one item. Thinking like this will still enable you to place trades. You only need to be aware of the base/counter concept for Fundamental Analysis issues.

So why is it important to know about the base/counter currency? The base/counter currency concept illustrates what is actually taking place in a Forex transaction. Some of you reading this, know that short-selling was restricted in the stock market *(Short-selling is where you sell a stock/currency/option/commodity first and then try to buy it back at a lower price later). But in the FOREX you are always buying one currency (base) and selling another (counter). If you sell the pair you are simply flipping which one you buy and which one you sell. The transaction is essentially the same. This allows you to short-sell with no restrictions.

You want to be able to short-sell with no restrictions so you can make money when the market drops as well as when it rises. The problem with traditional stock market trading is that the market has to go up for you to make money. With FOREX trading you can make money in all directions.

http://www.1-forex.com

Omar Vargas; FOREX Trader and Freelance writer.
http://www.1-forex.com

Learn to trade foreign currencies with Peter Bain Video ForEx Course

Every day, 1.7 trillion dollars float through the hands
of people who aren’t any smarter than you or I are.
It doesn’t make any difference if you’re an accountant,
baker, butcher, retired sea captain, homemaker,
airline pilot, surgeon - or cop on the beat.

If you’re willing to take some direction, you deserve a
nice piece of the action. You’ll never have to learn zip
about currencies. You will learn the techniques and
strategies to go out and claim what is rightfully yours.
Play right along with the giants of world commerce. You
won’t be on the outside looking in; you’ll be enjoying the
thrill of a lifetime, riding on their king-size coattails.
TRADING THE FOREX DESERVES YOUR SERIOUS CONSIDERATION.

Forex trading has enjoyed exponential growth and
widespread popularity over the past few years. It is only
now that online foreign exchange trading is starting to
get noticed.

Until recently, large international banks were the big
dogs in the foreign exchange (FX or forex for short)
market, selectively allowing access via telephone
trading to Fortune 1000 companies, large funds,
high-net worth individuals, etc..

But now, there are online trading firms that provide
individual traders like you and I with direct access to
the largest, most liquid financial market in the
world - the forex. A lot of traders seem oblivious to
this market. This unfamiliarity is the root cause of
misconceptions about this exciting market.

Spot foreign exchange is the ideal market for active
trading - more leverage than equities/futures/options.
The market is highly volatile, has a tendency to trend
strongly, and actively trades 24 hours per day. There are
no limitations on when one can short a currency.
Currency traders can make money when a currency is
becoming stronger or weaker.

Learn to trade foreign currencies with Peter Bain Video ForEx Course