Duration : 9 min 32 sec

Technorati Tags: forex

In stocks, traders and investors base their bids/asks, or buy and sell on lows and highs. The high and low in some instances have pips, currencies, spreads, or shares involved.

Most people in the trading industry will use charts to keep updated on pips. Pips are what traders call percentages factored into points. The percentages are quotes that determine the price set on currencies. The charts help these traders to keep track so they know when to buy and sell.

In the business, small and large banking institutions, as well as large and small companies invest in stocks, or Forex exchange. Using charts, the traders are provided quotes on both sides, which make up ask and bid phrase, depending on the stock market. The bids make up pricing, which is prompted once indicators within programs alert traders on Base Exchange that occurs between buying currencies on opposing sides. Once the alerts come in, the trader may select “ask” has the pricing occurs. The trader bases exchange on his, ‘ask’ which could flip at the drop of a dime.

Quotes enable traders to set their marks on pips, which can decide decimals that rise over the averages. In stocks, decimals convert in some instances to match exchange within the currencies of a sole country. Decimals base values, which are constant at all times.

One of the largest industries and growing is Forex. The foreign market exchanges currencies in stocks that have reached in the trillions of dollar brackets. That is trillions in a sole industry. This fiscal market has made the highest mark in the stock market industry. The market has overridden the largest United States equity branches.

Charts are employed in Forex. The guides, aid traders by allowing them to read, interpret through indicators, which send signals. Within the charts are treks, basic strategies, powers, and so on.

Anyone intending to get in on stocks or in the stock market, should take time to learn about highs/lows, bid/asks, charts, pips, spreads and so on to avoid increasing the high risks. Staying informed is the key to successfully gaining in any stock exchange. Still, you want to choose charts and information that offers you precision in the stock market, Forex exchange markets and other stock industries.

Your best solution for just starting out is to download free charts that allow you to monitor and analyze, while exploring pips, spreads, highs, lows, currencies and so on in stocks.

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The forex market, “Spot FX market” or foreign exchange market is made up of two main groups.

The one is the interbank market which consists of banks and other institutions who trade with one another on a daily basis.

The total turnover is estimated at 1.5 trillion US dollars per day and the banks trade with each other in the millions and multimillions.

As for the other portion making up the forex market, we are talking about the retail investor. This is any person who trades with their own capital either through the technology of the internet or via some other way, such as by telephone with a broker.

Retail investors tend not to move markets because the trades they place are insignificant in size to those of the banks.

Until fairly recently, it was very difficult for the retail investor to trade with the banks, especially intraday and with similar spreads as those offered within bank trading floors.

However, with the advent of the internet and technology, brokerage firms have cropped up all over the place providing a middle-man who allows the retail investor to trade with very similar spreads to the banks themselves, in realtime.

The advantage of this to the trader is that the broker, because most trades occur only in his books in reality, requires only a “margin deposit” to allow the home-trader to be able to control vast sums of real currency and hence make big profits with small capital.

For example, if a broker offers 100:1 leverage, the investor need only give the security of $1000 (in other words have at least $1000 free capital to place on the trade as security) to the broker in order to control $100,000 – or 1 lot – of currency.

This allows for losses and would mean each 4th decimal place movement of the currency pair price (eg – GBP/USD = 1.7689 – 1/7690) which may occur within seconds of placing the trade will be worth $10.
It would only take a change of 20 points (ie 1.7689 – 1.7709) to make a profit of $200 in a long.

The price would have to move considerably for the trader to actually lose that $1000 although it is possible for the market to move more than 100 points. Risk management such as setting a “stop loss” of 20 points would ensure a maximum loss of 20 points could be set as protection from further losses in the case of unexpected market movement.

So, in order to trade, we must trade through the environment of the margin broker. This is advantageous to us, in that we need a lot less capital to control fairly vast amounts of currency easily, legally and with real high profit potential on a daily basis.

What is required is an understanding of fundamental analysis and a sound technical strategy in the author’s opinion. The rest is abitrary. Most importantly, though, it must be said, trade only what you can afford to lose. Becoming a winner takes persistence and time in front of the charts.

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Duration : 5 min 32 sec

Technorati Tags: how

i've got the forex one. i want stocks tracker.(real time)

any reccomendation?

stockcharts.com has the best real time charting that I have been able to find.

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Can studying the news help you make profits in online FOREX trading? The answer for most traders is a no.

In fact, paying attention to the news in online FOREX Trading will lose money. Why? Read on and let’s find out.

How and why prices move

In online FOREX trading (and any financial market for that matter) prices move based upon the following equation

Supply & demand fundamentals + Trader psychology = Market price

Which is most important? In today’s markets definitely the latter Why?

Quite simply, markets discount fundamentals quickly and with the internet its done in seconds.

In all corners of the globe the internet delivers information quickly and it’s immediately discounted in the market price.

This means traders make opinions on what will happen in the FUTURE and it is their psychology that is the key to future price direction.

Sure, the papers and news wires are great at telling you why things DID happened and their normally wrong about WHAT will happen.

Traders get deluded by the experts in online FOREX trading and fail to see their wrong most of the time.

Will Rogers once said:

“I only believe what I read in the papers”

Now, he was joking, but most traders take news services as gospel.

Reuters and Bloomberg stories agree with them, so they must be right, is the view of most online FOREX traders. Don’t think so, in fact we know so, based upon the facts and the so called experts past performance.

It’s easy to be wise in hindsight, but looking into the future is much more difficult!

They write stories for a living they DONT trade, traders that are interested in making profits should not be following news stories or media hype.

It’s a fact: Most important market tops and bottoms and formed when the news is most bullish or bearish. When the trends change of course, news wires have an explanation but that does not help you trade!

In the 1987 crash they were bullish in the tech stock boom they were bullish and these are just tow examples of media experts being wrong and there are many others.

Understand the past and look to the future

This is the key to successful online FOREX trading. Quite simply the fundamentals are digested in seconds and reflected in the price.

Its trader psychology that’s important as they look at the future and how they determine the supply and demand situation is reflected in price changes.

Human psychology has remained constant over time and thats why many price patterns are so reliable and point to important market tops and bottoms when the market is either very bullish or bearish.

Of course, prices then go the other way! confounding the so called media experts.

Technical analysis of markets

The only way you can win in online FOREX Trading is to use a technical analysis system that focuses on price.

Why use a technical system in online FOREX trading?

There are two main reasons

1. You will not be distracted by media stories and news hype and will keep your emotions in check.

2. If you are involved in online FOREX trading you can look at charts and see long term trends that last for months or years and many of them (in fact most of them!) run against what the papers and the so called experts say!

To be a success in online FOREX trading all you need to do is focus on these trends and forget the news and media, media experts don’t get paid to trade, they get paid to write stories.

Focus on the reality of the price, not the media hype and you can make big profits in online Forex trading.

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