Bearish Euro Trend Intact

Bearish Euro Trend Intact
The dollar was mostly firmer vs. its major rivals Friday as the euro/dollar (EUR/USD) currency pair gave up early gains on negative European news to close lower on the day.
With the negative news stream likely to continue, we believe that the bearish euro trend remains intact. The yen was firmer too and kept up with the buck, and so the dollar/yen pair (USD/JPY) stayed around 91.

Emerging-market forex was mixed. The biggest gainers on the day vs. the dollar were the won (KRW), rupee (INR), Philippine peso (PHP), rupiah (IDR) and Taiwan dollar, while the biggest losers vs. the greenback were the koruna (CZK), zloty (PLN), Mexican peso (MXN), forint (HUF) and pound (GBP).

U.S. economic data were mixed, with personal spending and the Chicago PMI weaker than expected and the University of Michigan consumer confidence survey stronger than expected.

Czech elections had no clear winner, but center-right parties have the best shot at forming a coalition (which would be positive for the koruna).

In Colombia, former Defense Minister Juan Manuel Santos holds a big lead (47% vs. 22% for Antanas Mockus) in the presidential election with 89% of vote counted, but Santos needs 50% to avoid a second round.

The Bank of Korea urged central banks to make swap lines permanent, which contrasts with Federal Reserve Chairman Ben Bernanke's recent opposition to giving permanent access to Fed lines.

U.S. equity markets were lower, with the Dow falling 1.2%, the S&P 500 losing 1.2% and the Nasdaq declining 0.9%. European markets were down too, with Euro Stoxx 50 falling 0.2%.

Asian equities are likely to open lower Monday as Asian ADRs were lower during North American trading Friday. Nikkei futures point to a down open for Japan, and the strong yen should hurt Japan exporters.

The U.S. bond market was higher, as two- and 10-year yields were down 11 basis points and 8 basis points, respectively. European bond markets were mostly higher, as 10-year yields were down 3 basis points in the U.K., 2 basis points in France and 2 basis points in Germany. 10-year yields fell 5 basis points in Greece, 1 basis points in Portugal, 2 basis points in Ireland, 4 basis points in Italy and 2 basis points in Spain.
The euro was also hurt by news from Germany's BaFin, the financial regulator, that the government remains committed to the naked-short ban despite the lack of international or even European support.

BaFin's head has gone even further to suggest that the government is considering making the ban on some EMU debt securities permanent, while currently there is a March 2011 expiry, according to Reuters. A couple of days ago, a draft document suggested that euro derivatives (we're not exactly sure all that is included) and additional equities could be added to the banned naked-short list. With month-end at hand, holidays in the U.K. and U.S. on Monday, and the consolidative tone, many participants lack near-term conviction, but we do not see a serious change in market sentiment or fundamentals (yet).

Moody's was constructive on Turkey, saying it would likely upgrade the country from its current Ba2 (equivalent to double-B) if it passes a fiscal rule that has been in the works.

Moody's noted that the rule "would support the medium-term plan to rein in the fiscal stimulus of the past few years and reverse the deterioration in debt metrics." The agency added that further upgrades would depend on labor market reforms, improvements in tax administration and improving debt ratios.

Our sovereign ratings model puts Turkey at BB+/Ba1, and we note that Fitch has Turkey correctly rated at BB+, while Moody's and S&P (BB) should move it up a notch. The IMF team just left Turkey, but was there for its annual Article IV consultation. A standby IMF deal is no longer on the table. The Turkish government is trying to pass the fiscal rule in June, which it says was drafted in consultation with the IMF.

Rather than trying to play the Turkish lira (TRY) vs. the dollar or euro, we think investors should go long the Turkish lira against the koruna or forint. We are maintaining our long TRY/HUF recommendation and would use this pullback to establish a position. The break of the 2009 high of 145.50 in early May now targets the 2008 high of 152.67. Investors get some carry here as well (6.5% vs. 5.25%).
The Turkish lira/koruna pair broke higher and tested 13.5 in May. We target a move back to the 2009 high around 14 followed by the mid-2008 high of 14.48, and so this pullback offers a good opportunity to go long. With Turkey rates at 7.0% and Czech ratesnow at 0.75%, investors will get a whole lot of carry, and the Turkish central bank will be among the first to tighten in the region, possibly ahead of Poland.
The koruna remains our favorite short in the Europe, Middle East and Asia region, not only for the low rates (0.75%) but also for what we see as deteriorating fundamentals. General elections are underway Friday and Saturday, and most polls show no clear winner emerging.

Recall that the current government is a caretaker one, which became necessary back in March 2009 when the previous government collapsed. That government was formed after elections in June 2006 (also triggered by a government collapse) were inconclusive, which led to seven months of jockeying before center-right Civic Democrats patched together a coalition in Jan 2007 that held creakily until March 2009.

Most would agree that lack of a strong, stable government has hindered the Czech Republic's efforts at serious fiscal reforms. The years 2004-2007 saw a narrowing of the budget deficit, but this was a cyclical improvement as GDP growth soared to 6%-7%. With slow growth expected for the region, we believe the Czech fiscal trajectory won't improve much over the next couple of years without structural reforms.

The zloty/koruna is another favored trade of ours. The recent pullback gives investors an opportunity to go long the zloty before this pair resumes its upward move. With high Polish rates (3.5%) and a good economic outlook contrasting with low Czech rates (0.75%) and a relatively weak growth profile, we look for an eventual move higher back to 7.0 and then to the 2008 high of 7.5.

Commodity Futures Trading Commission data show that for the week ended May 25, speculative accounts' dollar bets were mixed. Net short euro positions fell to -106,736 from -107,143 previously, Swiss franc net shorts decreased to -12,619 from -14,558, and sterling net shorts eased to -75,079 from the record -76,745 previously. However, the dollar bloc saw its net long positions cut in half. The Australian dollar (AUD) was at 19,523 vs. 38,380 previously, the Canadian dollar (CAD) was at 23,872 vs. 44,885 previously and the the Mexican peso (MXN) saw net longs decrease again to 28,857 from 35,702 previously. Speculators cut net short yen positions to -10,238 from -34,289 previously. With the yen strong at the start of last week, net yen shorts should decrease more in the next weekly report.
Upcoming Releases

Asia: Japan, Korea industrial production; Australia current account; India GDP; Thai trade, current account, industrial production, retail sales

Europe/EMEA: South Africa money and credit growth, trade; eurozone M3; Norway retail sales; Poland GDP; Hungary central bank meeting

Americas: No U.S. data; Canada GDP; Chile unemployment, central bank minutes; Colombia unemployment. No U.S. speakers of note due to U.S. holiday. U.K. closed for bank holiday.

Gbp/usd Weekly Outlook: May 31-june 4

The pound hovered near a 14-month low against the U.S. dollar last week, bouncing briefly on Thursday only to fall back on fears over Europe's debt crisis and in the wake of disappointing U.K. economic data.

GBP/USD rose from Tuesday's low of 1.4258 to hit an 8-day high at 1.4606 on Thursday, before retreating to reach 1.4453 at the close of trade, slipping 0.02% on a weekly basis.

The pair is likely to find support at 1.4229, the low of May 20 and a 14-month low, and resistance at 1.4917, the high of May 13.

Sterling's decline versus the dollar also came after Fitch Ratings cut Spain's credit rating, renewing concerns that other heavily indebted euro zone members will suffer the same fate as Greece.

Next week, key data will be published on the U.K. housing market, manufacturing sector and services sector. Reports will also be released on the U.K. construction industry and the level of credit available to British consumers.

In the United States, meanwhile, important data will be released on nonfarm unemployment and initial jobless claims, as well as on the country's manufacturing sector and housing market. Reports will also be published on U.S. hourly earnings, construction spending, vehicle sales, factory orders and crude oil inventories. The Chairman of the Federal Reserve, Ben Bernanke, is also due to speak at a public engagement.

Ahead of the coming week, Forex Pros has compiled a list of these and other significant events likely to affect GBP/USD.

Monday, May 31

Bernanke is scheduled to speak at an event in Seoul. Traders are likely to scrutinize his comments for clues to future shifts in monetary policy.

Banks in Britain and the United States will be closed as the countries hold bank holidays.

Tuesday, June 1

The marketing research firm Markit will publish a key report on Britain's manufacturing sector, based on a survey of purchasing managers. The results of the survey – which asks respondents to rate the relative level of business conditions including employment, production, new orders, prices, supplier deliveries, and inventories – are seen as a leading indicator of economic health.

The U.S. will publish a report on spending in the construction sector. An industry group, the Institute for Supply Management, will later publish an important report on the U.S. manufacturing sector based on a survey of purchasing managers.

Wednesday, June 2

Markit will publish a report on the British construction industry, based on a survey of purchasing managers. The Bank of England will also release data on net lending to individuals and final mortgage approvals in Britain.

Later in the day, an industry group will release a report on U.S. pending home sales, a leading indicator of economic health. The report, which excludes new construction, measures the change in the number of homes under contract to be sold but still awaiting the closing transaction.

Thursday, June 3

A U.K. industry group will then publish a report on British house prices, an important gauge of the housing market's health. Markit will later release data on the British services sector, based on a survey of purchasing managers.

The U.S. Department of Labor will release data on labor efficiency when producing goods, excluding the farming industry. The data processing firm ADP will publish a closely watched report on U.S. nonfarm employment change.

The U.S. will then release key data on initial jobless claims, an important indicator of overall economic health. The U.S. will also publish a report on the cost of labor, again excluding the farming industry. Later in the day, Bernanke is scheduled to speak at an event in Detroit.

Friday, June 4

The U.S. will publish key employment data in a report on nonfarm payrolls, a leading indicator of consumer spending and overall economic health. The country will also announce its unemployment rate.

3 Must Haves Before You Become A Professional Forex Trader

I started trading Forex to make money, and I didn’t have a plan. Can you guess what happened? Yes that’s right I blew my account rather fast, it is a good thing it was a micro account with only $100.00. The way that I started my trading career is the way that many of us start our trading careers. By acting on impulse without a plan on how we are going to achieve success. Unfortunately, that is not how it should be done. There is a right way to begin your trading career that maybe just maybe you can avoid two or 3 margin calls before you get warmed up.

Before I talk about the right steps to take I want to ask all of you out there a question. Do you Love what you do? I remember working at my job and while I was on the job I was miserable all day long and I hated my work. I finally found something that I don’t just like I love. Did you ever have dreams when you were young about that special career that just never seemed to happen? I think to be truly fulfilled in life you should attempt to find something that you love to do. In my case it was trading forex and running this site. I hope that you are able to find something that is truly what you have been dreaming of doing. So now for the sake of this site which is all about Forex Trading, that you have decided that you want to trade Forex as your new career.

So you want to Trade Forex???? That is a great goal and I admire anyone that attempts to make that happen but please don’t jump in without taking the necessary steps to ensure success.
Here are 3 steps that you must take in order to trade forex for a living? I am listing these in order of importance.

1. Have your financial house in order – If you are trying to start to trade forex to get yourself out of a financial jam or to make money quick because you need cash. Then stop right now and don’t do that because that is a recipe for disaster. If you don’t have the money to trade then don’t trade plain and simple. I am not trying to dash your dreams but if you begin trading with money they you can’t afford to lose then the psychological pressure will be too high and you will lose everything.

2. Have the Right System – Having a system and a strategy that works is crucial to trading success. This must be figured out before going on to being a trader for a living.

3. Actually Make Money – I know people that have quit their jobs to trade and they were still losing money. Please provide for yourself a winning track record that has proven profitable over a period of time before you think of trading forex professionally.

So I hope that you have benefited from the tips on how to trade Forex for a living. I am always referring to Winners Edge Trading as a Forex Company that truly cares and desires to help. So I have decided to add financial and career coaching as a service available to Forex Traders. The truth is is you don’t have your financial life in order you will struggle and I want for each of you to be able to focus 100% on trading and not have money matters on the back of your mind.

Be on the look out for part 2 of this article written by Ed Burns of The Provision Group. Ed is a financial and career coach and he will be featured next week. With his article about how to get ready to trade and what your financial picture should look like.

GBP/USD ends week practically unchanged

The Pound finished on Friday around the same price level it had a week ago, hovering around 1.4450/70. GBP/USD failed to consolidate above 1.4520 and pulled back to 1.4430.
The pair broke yesterday an important resistance and rallied to 1.4610, reaching a 2-week high but the pair was rejected from those levels. Earlier the Pound was able to hold above an important support zone that lies at 1.4220/30.
“The main trend remains down in the GBP USD but the market is beginning to show signs of a bottom. The short-term range is 1.4229 to 1.4610. This creates a retracement zone at 1.4419 to 1.4374. Watch for a near-term pull-back into this zone. If this market is going to move higher then it must build a secondary higher bottom at or near this zone”, James Hyerczyk, analyst at ForexHound.com said.

EUR/USD hits 1-week lows

The Euro extended its decline against the Dollar and fell barely below yesterday's lows to 1.2165, hitting a 1-week low. EUR/USD is consolidating important losses for the day.
The European currency remains under pressure across the board amid concerns over fiscal and financial problems in the Eurozone.
The pair continues to trade near daily lows and is approaching to 4-year lows that lie at 1.2140/45. Below, the next support levels lie at 1.2100 and 1.2060/65 (Apr 12 /13 2006 lows).

USD/JPY moves away from daily lows

The Dollar is trimming losses against the Yen. USD/JPY is still holding below 90.00 but is testing levels above 89.70. To the upside, immediate resistance lies at 89.90 and above at 90.10 and 90.40.

A semi official intervention around 89.00 is supporting the pair so for, according to Valeria Bednarik, collaborator at FXstreet.com. “Thus general trend remains strongly bearish; pair will need to strongly recover above 90.00 to change current intraday trend”, Bednarik says.

Yesterday USD/JPY failed to consolidate above 90.45 and during today’s Asian session regained the downside and tumbled to 89.24, just 28 pips above last week lows.

CBK: Oil volatility and forex instability threaten low inflation

Volatility in the oil market and exchange rate instability are emerging as threats to Kenya’s low and stable inflation, Central Bank of Kenya warns.

The CBK governor, Prof Njuguna Ndung’u, said that the weakening of the Kenya shilling against the dollar bears the risk of piling inflationary pressure on the consumer goods market as importers pass on additional costs to consumers.

Commercial banks quoted the shilling at Sh79.40 to the dollar, its lowest level since April 20, 2009 with currency dealers saying it will maintain a weak tone in coming weeks. 

This comes at a time when commodity prices led by oil and metals remain volatile—further making the cost of imported good such as Petroleum products, industrial machinery and second hand cars expensive.

Top threats

CBK said on its latest update on the economy that inflation has ceased to be among the top threats on lower food and electricity prices, but warns that volatile oil prices and exchange rate stability could upset this position.

“Some of these benefits could be offset by oil price movements and risks associated with exchange rate volatility due to the Greek debt crisis,” said Ndung’u while releasing the monetary policy statement last week.

Inflation dropped from a high of 17.9 per cent in September to a single digit regime after the government introduced a new method of calculation.

Month on month inflation stood at 3.7 per cent last month.

A steep rise in energy and capital goods import bill with the weakening of the shilling could become a key driver of inflation.

“Kenya being a net importer, a weak shilling can only increase inflationary pressure,” said Paul Mwai, the CEO of African Alliance Asset Managers.

Pump stations

Economic Survey 2010 indicates that Kenya imported goods worth Sh788 billion in 2009 against exports of Sh323 billion, reflecting a net negative position of Sh465 billion.

A weak shilling is expected to pile pressure on petroleum pricing.

Oil prices rose to $87 a barrel on May 3 but has since fallen to $70 on concerns over the Euro economy, but local dealers reckon that the strengthening of the dollar against shilling could erase the gains at pump stations.

A litre of unleaded fuel is retailing at Sh94 in Nairobi’s Central Business District (CBD) up from Sh77 in April.

Currency dealers say the shilling was a victim of the uncertainty over the direction of the Euro economy, prompting investors to ditch other currencies in favour of the dollar.

Europe is besieged by a debt crisis that began with Greece’s near default that caused jitters over weaker European economies such as Portugal, Spain and Italy.

Eur/Usd:Forex Strategy

Hello traders and all, here is your forex strategy for the upcoming week. I hope that you are all having a great weekend. This is the weekly summary to help you get an idea of what is going on so that you will be ready to go next weekend. The end of this week saw the Euro pain start to ease a bit. The question is will it continue or is this just a small bounce that will lead to more Euro selling.

If you look at the 4 hour chart you can see that we have bounced off of the bottom and are heading up now. One possible Forex trading strategy would be to not sell until you get a 4 hr candle break below the upward trendline that I have drawn on this 4 hour chart.
When trading this Forex Strategy using a trend line break like this it is important to set a solid stop loss above the trend line in case the trade continues in the current upward direction.

The current support level for this pair is 1.2138 look for this level to either hold when it gets tested next or break down for bigger losses.  The next level of resistance for this pair is 1.2600 and then 1.3000 those are key levels that we could see a sharp bounce off of these areas to  the downside.

You can expect to get trading advice such as this everyday when you subscribe to our premium trading service.

Thanks for reading and take glance at the recommendations below.

Other Blogs that are writing about Eur/Usd:

Forex Crunch: Has Forex Strategy and Updates
The GeekKnows-Eur/Usd daily commentary

One other tool free trading tool I recommend is Currensee where you can see what other traders are doing and learn a style from them.

Popularity: 17%

EUR/USD weekly review 17 may - 21may 2010

Good day forex traders.

Hope you are having a great weekend so far and that your trading week was green in profi
In the last review, we noted a forex gap of more than 100 pips due to the decision by the European Union to embark on a crisis aid plan to assist as much as almost 1 trillion dollars to the worst hit European nations. The ECB stated that it would ease severe strains in certain markets by purchasing government and private debt. Having said so, sentiments grew negative as investors were worried about the adequacy of the emergency lending plan. They also speculated that due to the amount of this aid plan, the European economy might be dented badly. Towards end week, rumors surfaced regarding the break up of the Euro Zone. These highlighted the extremely negative sentiments.

Looking at the EUR/USD chart above, the currency pair hit a low under 1.2200 and had since recovered ending the week bullish.

Early last week, the premium for insurance against a drop in the Euro was the highest in more than 7 years. Concerns plagued sentiments as investors worried about the erosion of the Euro. Global stocks and commodities fell in value. Rising borrowing costs among banks suggested a similar situation like the 2008 crisis might be happening if the situation got worse. When the European Union transferred 18 billion to Greece, the EUR/USD did not recover as investors felt this only merely delayed any risk of a default. They were also concerned that Germany’s role in the aid solution might be opposed by the German lawmakers. Talks of a possible parity with the US Dollar surfaced.

By midweek, the EUR/USD had tested below 1.2200 probably as a result of risk aversion caused by the imposed ban on naked short-selling by Germany. Investors were uncertain of the complications and probably withdrew from riskier assets. However once the initial thoughts were over, the EUR/USD recovered as that was an indication of more support for the Euro. The German Chancellor also mentioned in parliament that Germany would suggest to the European Union measures including budget cuts, concrete penalties for rule breaking and the orderly insolvency of European Union nations. With the weaker Euro, reports stated that the manufacturing industry of the Euro Zone was improving. To further brighten the Euro proposition, foreclosures and mortgage delinquencies in the US broke records, bringing investors back to reality that the US economy was not as robust as believed.

Towards the end of the week, poorer than expected US figures gave the markets more reason to improve on their sentiments of the Euro versus the US Dollar. US unemployment claims brought disappointment and a leading indicator indicated that the recovery might slow down in the second half of the year. Investors were beginning to worry that the crisis might arrive at US’s shore. When Germany’s share of the aid program for the Euro Zone was approved, investors were relieved and looked forward to a stop of the Euro deficit crisis. A meeting of European Union financial minsters was held to discuss reforms on economic controls and policies. This was probably seen as a sign of more action being taken to curb the crisis and helped set the stage for a bullish end of the trading week.

***

European Union finance minsters met on Friday to discuss ways to reform economic controls and polices. It was generally agreed that stiffer sanctions on countries with high budget deficit should be implemented. This was to prevent a similar crisis from happening again. It was reported that both financial and non-financial sanctions were under consideration for repeat violations of the Euro Zone’s deficit limit of 3% of GDP. It was reported that Germany was heading a move to remove certain voting rights of such violating countries and reservations were noted. While Germany called for a default procedure, this view was not shared by the majority.

While this meeting has great potential to improve sentiments by displaying a sign of concrete actions being done, due to the complexity of the plans, disagreements may surface and this may lead investors to see it as a lack of unity. Furthermore any measure decided may need a long period of time to implement due to the nature of the union. The situation remains crucial and any adverse developments may sent the EUR/USD crashing down again.

On a side note, an important fact is that sentiments with regards to the recovery in the US seems to be flickering as economic data starts to post disappointing results. This will be a development for close monitoring too.

Apart from the important economic events for the upcoming week, Monday will be a bank holiday for a number of European Nations. Therefore low volume conditions may be experienced. You can find the list of the various economic releases in the Economic Calender below.
Trade safely and remember that while we have no control over the market, we have control over the way we manage our money. Proper money management is a must.

Euro Testing 200 Hr MAVG

After reaching a session high of 1.2671, the highest level since May 13th, the EUR/USD pair has traded continually lower and is now testing the 200 hr moving average at 1.2472. As shown below, the last two hourly candlesticks tested the line but could not break through; a close below may be a bearish signal for the pair in which case the next downside target would be the 61.8% line on the move from the low of May 20 to today’s high, at 1.2439. The next topside target is currently the 38.2% line at 1.2528 and further is the 23.6% retracement at 1.2582.

USD/JPY back below 90.00

The Dollar rose to 90.39 and approached to daily highs that lie at 90.45 but it failed to hold and weakened. USD/JPY pulled back below 90.00 and fell to 89.75.

Currently trades around 89.80/90, 0.65% below today's opening price. Despite today's gains the Dollar has been unable to erase most of yesterday's losses.

According to Michael J. Malpede, analyst at Easy Forex, key technical levels to watch in USD/JPY include support at 88.95 (May 6th low) with resistance at 91.88 (May 20th high)

Australian Dollar picks up amid RBA intervention rumours

Australian Dollar has weakness has eased on Asian session, and the Aussie has bounced up, to appreciate against its major rivals on the back of rumours of the Reserve Bank of Australia "checking FX rates", which seems to have triggered short covering on AUD crosses.

AUD/USD decline from 0.9300 area at the beginning of May extended yesterday with a 380 pips sell off to a fresh 1-month low at 0.8075, and the pair has bounced up to 0.8365 session high on Asian trade although the Aussie has lost the 0.8300 level at European opening.

AUD/JPY decline from 84.50 area last week, extended to a 10-month low at 71.85 on Asian session, to bounce up to 75.50 high at European opening, and the AUD/NZD decline from 1.2600 high on Monday, found support at 1.2125 low on early Asian session before oaring to 1.2500 high and pull back again, on early European session to quote at 1.2265 at the moment of writing.

Read more: http://community.nasdaq.com/news/2010-05/forex-australian-dollar-picks-up-amid-rba-intervention-rumours.aspx?storyid=22086#ixzz0obSgqFvz

Laguerre RSI and Filter Line - Custom MT4 Indicators

Benefits
    * Filters False Signals
    * Trend System
    * Easy to read and implement

Trading Strategies

You can use this indicator to buy when the line reaches the bottom level of 0.2 and to exit the long position when it reaches the level of 0.5 above. Sell when the line crosses the level of 0.8 above and out of short positions when the line crosses the bottom level of 0.5.

Input parameters:

* Gamma (default = 0.7) - the coefficient which is used in the calculation of the line. The higher, the more the line will be flat.
* CountBars (default = 950) - the maximum number of bar graph, which will be calculated as an indicator. Install the largest possible number, if you do not have problems with the computer's performance.
Laguerre RSI indicator settings:


Gamma: 0.85
Count Bars: 9500

Default parameters: Fixed minimum -0.05 Fixed Maximum 1.05
Default Levels: 0.85, 0.45 and 0.15

Laguerre Filter line setting Gamma: 0.85

Code For Laguerre RSI:

//+------------------------------------------------------------------+
//|                                                 Laguerre RSI.mq4 |
//|
//+------------------------------------------------------------------+

#property indicator_separate_window
#property indicator_level2 0.75
#property indicator_level3 0.45
#property indicator_level4 0.15
#property indicator_minimum 0
#property indicator_maximum 1
#property indicator_buffers 1
#property indicator_color1 MediumPurple

//---- input parameters
extern double    gamma=0.7;

//---- buffers
double RSI[];
double L0[];
double L1[];
double L2[];
double L3[];

//+------------------------------------------------------------------+
//| Custom indicator initialization function                         |
//+------------------------------------------------------------------+
int init()
{
   IndicatorBuffers(5);
//---- indicators
   SetIndexStyle(0, DRAW_LINE);
   SetIndexDrawBegin(0, 1);
    SetIndexLabel(0, "Laguerre RSI");
    SetIndexEmptyValue(0, -0.01);
   SetIndexBuffer(0, RSI);
   SetIndexBuffer(1, L0);
   SetIndexBuffer(2, L1);
   SetIndexBuffer(3, L2);
   SetIndexBuffer(4, L3);
//----
   string short_name="LaguerreRSI(" + DoubleToStr(gamma, 2) + ")";
   IndicatorShortName(short_name);
   return(0);
}

//+------------------------------------------------------------------+
//| Custor indicator deinitialization function                       |
//+------------------------------------------------------------------+
int deinit()
{
   return(0);
}

//+------------------------------------------------------------------+
//| Custom indicator iteration function                              |
//+------------------------------------------------------------------+
int start()
{
    int    limit;
    int    counted_bars = IndicatorCounted();
    double CU, CD;
    //---- last counted bar will be recounted
    if (counted_bars>0)
        counted_bars--;
    else
        counted_bars = 1;
    limit = Bars - counted_bars;
    //---- computations for RSI
    for (int i=limit; i>=0; i--)
    {
        L0[i] = (1.0 - gamma)*Close[i] + gamma*L0[i+1];
        L1[i] = -gamma*L0[i] + L0[i+1] + gamma*L1[i+1];
        L2[i] = -gamma*L1[i] + L1[i+1] + gamma*L2[i+1];
        L3[i] = -gamma*L2[i] + L2[i+1] + gamma*L3[i+1];
    //Print(i," Close[i]=",Close[i],", (1.0 - gamma)*Close[i]=",(1.0 - gamma)*Close[i],", gamma*L0[i+1]=",gamma*L0[i+1]);
    //Print(i," L0=",L0[i],",L1=",L1[i],",L2=",L2[i],",L3=",L3[i]);

   

        CU = 0;
        CD = 0;
        if (L0[i] >= L1[i])
            CU = L0[i] - L1[i];
        else
            CD = L1[i] - L0[i];
        if (L1[i] >= L2[i])
            CU = CU + L1[i] - L2[i];
        else
            CD = CD + L2[i] - L1[i];
        if (L2[i] >= L3[i])
            CU = CU + L2[i] - L3[i];
        else
            CD = CD + L3[i] - L2[i];

        if (CU + CD != 0)
            RSI[i] = CU / (CU + CD);
    }
   return(0);
}
//+------------------------------------------------------------------+



An additional Forex indicator — Laguerre Filter line — is drawn directly over the charts and looks like a moving average. Laguerre Filter line filters Laguerre RSI signals.

When Laguerre RSI tells to go Long (buy), Forex traders would enter only if price is above Laguerre Filter line. Opposite true for Sell signals: when Laguerre RSI signals to Short, price must be below Laguerre Filter line in order for a signal to be valid.

Code for Laguerre Filter

//+------------------------------------------------------------------+
//|                                               LaguerreFilter.mq4 |
//|                                  Copyright © 2006, Forex-TSD.com |
//|                         Written by IgorAD,igorad2003@yahoo.co.uk |  
//|            http://finance.groups.yahoo.com/group/TrendLaboratory |                                     
//+------------------------------------------------------------------+
#property copyright "Copyright © 2006, Forex-TSD.com "
#property link      "http://www.forex-tsd.com/"
#property indicator_chart_window

#property indicator_color1 Yellow

//---- input parameters
extern double    gamma      = 0.7;
extern int       Price_Type = 0;
//---- buffers
double Filter[];
double L0[];
double L1[];
double L2[];
double L3[];

//+------------------------------------------------------------------+
//| Custom indicator initialization function                         |
//+------------------------------------------------------------------+
int init()
{
   IndicatorBuffers(5);
//---- indicators
   SetIndexStyle(0, DRAW_LINE);
   SetIndexDrawBegin(0, 1);
    SetIndexLabel(0, "LaguerreFilter");
    SetIndexBuffer(0, Filter);
   SetIndexBuffer(1, L0);
   SetIndexBuffer(2, L1);
   SetIndexBuffer(3, L2);
   SetIndexBuffer(4, L3);
//----
   string short_name="LaguerreFilter(" + DoubleToStr(gamma, 2) + ")";
   IndicatorShortName(short_name);
   return(0);
}

//+------------------------------------------------------------------+
//| Custor indicator deinitialization function                       |
//+------------------------------------------------------------------+
int deinit()
{
   return(0);
}

//+------------------------------------------------------------------+
//| Custom indicator iteration function                              |
//+------------------------------------------------------------------+
int start()
{
    int    limit;
    int    counted_bars = IndicatorCounted();
    double CU, CD;
    //---- last counted bar will be recounted
    if (counted_bars>0)
        counted_bars--;
    else
        counted_bars = 1;
    limit = Bars - counted_bars;
    //---- computations for RSI
    for (int i=limit; i>=0; i--)
    {
        double Price=iMA(NULL,0,1,0,0,Price_Type,i);
       
        L0[i] = (1.0 - gamma)*Price + gamma*L0[i+1];
        L1[i] = -gamma*L0[i] + L0[i+1] + gamma*L1[i+1];
        L2[i] = -gamma*L1[i] + L1[i+1] + gamma*L2[i+1];
        L3[i] = -gamma*L2[i] + L2[i+1] + gamma*L3[i+1];
       
        CU = 0;
        CD = 0;
        if (L0[i] >= L1[i])
            CU = L0[i] - L1[i];
        else
            CD = L1[i] - L0[i];
        if (L1[i] >= L2[i])
            CU = CU + L1[i] - L2[i];
        else
            CD = CD + L2[i] - L1[i];
        if (L2[i] >= L3[i])
            CU = CU + L2[i] - L3[i];
        else
            CD = CD + L3[i] - L2[i];

        if (CU + CD != 0)
            Filter[i] = (L0[i] + 2 * L1[i] + 2 * L2[i] + L3[i]) / 6.0;
    }
   return(0);
}
//+------------------------------------------------------------------+




Laguerre Filter line doesn't filter all false signals, though.

Forex trades may choose to play with Laguerre RSI settings in order to make Laguerre indicator more or less sensitive. Settings apply to Gamma parameters. Common settings are:
Gamma 0.85
Gamma 0.7
Gamma 0.55

When using Laguerre Filter line together with Laguerre RSI in Forex, make sure they both have the same Gamma settings

Learn Foreign Exchange Trading - How the Forex Currency Market Works

Fact: The Foreign Exchange Market is the largest financial market in the world!With an average daily trading volume of over $1 Trillion, the Foreign Exchange or "forex" market is easily the largest financial market worldwide. In fact, it is in upwards of thirty times larger than all of the U.S. equity markets combined! While it may sound exotic and mysterious to someone who is not familiar with it, it is actually quite simple once you develop an understanding of how it works. The intent of this article is to introduce you to the Foreign Exchange market and provide you with the knowledge necessary to profit from both long and short term trends in this exciting marketplace. The guide that follows will show you the advantages to trading in the forex market and provide you with the tools you need to be a successful trader.
The Foreign Exchange Market - Currency Trading

The Foreign Exchange had long been limited to large international banks, import and export companies, hedge funds, and high net worth individuals. The Internet changed all of that and allowed individuals the opportunity to access these markets alongside the professional traders. While the equity markets have enjoyed exponential growth thanks to the spread of online brokerages and mutual funds, the Foreign Exchange or "FX" market has remained a mystery accessible only to a privileged few. The once exclusive world of currency trading is now gaining popularity at a rapid pace with the arrival of reputable online trading firms providing access to retail investors.

Forex trading refers to the "exchange of" or simultaneous purchase of one currency and sale of another. Unlike the equity markets where a security such as Intel (INTC) can be bought and sold at any time independent of other securities, Currencies trade in pairs with prices based on the relationship of one currency to another. The most commonly traded pairs referred to as the "Majors" are the Euro, The US Dollar, Japanese Yen, Swiss Franc, British Pound, Australian Dollar, and Canadian Dollar. Approximately 85% of all currency transactions involve the majors making them the most liquid of all trading pairs and therefore the best suited by individual traders and investors

How the Market Works

At first glance, the currency markets can seem confusing or intimidating. One of the most important concepts of the currency market is understanding the structure of the quotes. The most important thing to remember is that the first currency listed in the pair is considered the base currency and its value is always equal to 1. In the following example, we will use the currency pair of US Dollar vs. Japanese Yen expressed as USD/JPY. The US Dollar or USD is considered the base currency. The quote will be expressed as a unit of $1 USD per the other currency, in this case the JPY. A quote of USD/JPY of 110.05 would mean that a single US Dollar is equal to 110.05 Japanese Yen. For those of you who have traveled internationally and dealt with the exchange of currency, this concept will be familiar.

Interpreting these relationships is simple when you remember that a rising quote represents an increase in value of the base currency (The currency listed First in the quote) while a falling quote represents a decrease in the value of the base currency as compared to the other currency listed in the pair.

Just as in the equity markets, when viewing a forex quote you will see two values, one being the "Bid" and the other being the "Offer" which is also commonly referred to as the "Ask". The bid is simply the highest price that a current buyer is willing to pay for the quoted currency at any given time while the offer represents the lowest price that a current seller is willing to accept for the same transaction. The key point to remember is that the offer or ask price is the price at which you can purchase the base currency while the bid is the price that you can sell the base currency at any given time.

This becomes much clearer when you begin to see it in action. Once you participate in some sample trades, it will quickly become second nature and you will be on your way to trading currency like a pro.

Learning How to Trade

While this topic could be the subject matter of an entire book of it's own, for the sake of simplicity I will just provide a few tips to help you get started and go into further detail with some additional articles. The best way to get your feet wet and learn how to trade the foreign exchange market is to open what is called a "practice" account with an online forex broker. These accounts are 100% free and don't require you to involve any of your own money to trade. These practice accounts serve as an exact simulation of what goes on in the currency market including streaming prices, charts, and news. The system will allow you to place practice trades and will calculate what you profit or loss would have been on each had it been a real trade. This is a great way to get a feel for the market and refine your trading skills before you put any money at risk. There are plenty of online forex brokers offering this service so you will definitely have the opportunity to shop a few of them and see which one you like best. There is nothing preventing you from opening a practice or "demo" account as they are sometimes called with more than one company. That will allow you to see which one you like better and which one best fits your trading style. You will find that with a little practice, you are able to learn how foreign exchange trading works very quickly. Once you see how the market works and are comfortable with your trading skills, you can open a live account and start trading with real money.

Forex Scams

Despite many brokers claims to the contrary, trading foreign exchange successfully is not an easy thing to do. FX trading is at best a risky business and at worst, a scammer’s dream come true. The Commodities Futures Trading Commission (CTFC) has seen a marked increase in the amount of foreign exchange scams over the last few years as FX trading has become more and more popular.

There are many companies claiming to have a foolproof way of making money with one system or another and while some of those systems have a basis in fact, even the most well-researched, well developed system cannot take into account the vagaries of the market place.

The Division of Clearing and Intermediary Oversight (DCIO) recently released an additional advisory aimed at protecting consumers from this ever growing problem, but the CTFC has some basic, solid advice regarding becoming involved in Forex trading:

    * No matter what you're told, Forex trading is risky.
    * Don't be pressured into an immediate decision.
    * Use common sense.
    * Get everything in writing.
    * Check with the CFTC.
    * Seek advice from an accountant, lawyer or an independent 3rd party.
    * Don't invest more than you can afford to lose.
    * Don't mortgage your home or cash in your savings to trade Forex.
As a general rule, it is best to avoid any companies claiming that Forex trading is easy, guarantees results or encourages you to make small deposits and use high leverages. Regardless of how well educated you are, investing a small sum in FX trading is likely to end in losses. Some recent scammers who have been caught by the CTFC include:

    * Lake Shore Asset Management
    * Lake Dow and Ty Edwards
    * Ben Ouyang
    * Emerald Worldwide Holdings, Inc.
    * Foreign Fund (First Bank)
    * Equity Financial, Shasta, or Tech Traders
    * IBS/IMC
    * Kevin J. Steele
    * Nawab Ali Khan Ali
    * Sun Platinum
    * Worldwide Commodity CorporationGraystone Browne Financial
    * Sterling Trading Group, Inc.
    * STG Global Trading or QIX, Inc.
    * Universal FX, Inc.

There are case reports available from the CTFC website which are updated on a regular basis. In the meantime, if you have lost money in dealings with any of these companies or individuals, there is a contact page at CTFC.

One of the most disturbing recent trends is the amount of Forex sites claiming to be helping traders when in fact the opposite is true. Forexbastards.com claim they are there to help the trader distinguish the “good guys from the bastards.” Here is a video clip uploaded by Nick B, demonstrating how effective they are.

List of Top Forex Trading Brokers in Chennai. Companies offering Forex Exchange services in Chennai

Maharaja Forex Pvt Ltd

Thyagaraya Nagar, Chennai, Chennai, Tamil Nadu 600017 - 044 2815 3910

Sri Vari Foreign Exchange

Thyagaraya Rd, Thyagaraya Nagar, Chennai, Chennai, Tamil Nadu 600017 - 044 42605010

Janaki Forex

12, Sindur Plaza,42,Montieth Road, Chennai, Tamil Nadu 600008 - 044 28591775

Thomas Cook

45, Montieth Road, Chennai, Tamil Nadu 600008 - 044 25330105

Dugar Finance India Ltd

123, Marshalls Road,, Egmore, Chennai, Tamil Nadu 600008 - 044 28586262

Centrumdirect Ltd

16/4, Haddows Road, Nungambakkam, Chennai, Tamil nadu 600006 - 044 22540002

7 Forex & Travels India Pvt Ltd

129, G.N.CHETTY ROAD,, CHENNAI, Tamil Nadu 600006 - 044 4554 4680

KPS Forex Pvt Ltd

No. 3 Corporation Complex, Opp.to Kodambakkam Telephone Exchange,, 115 Arcot Road, Kodambakkam, Chennai, Tamil Nadu 600024 - 044 24724749

Dass India Money Changer(P) Ltd

New No 86, Old No20, Rajaji Salai, Chennai, Tamil nadu 600001 - 044 25356719

Sugir Trs & Trvls Pvt Ltd

No. 95, , Teynampet, Chennai, Chennai, Tamil Nadu 600004 - 044 24660980

Uae Exchange & Financial Services Ltd

No. 68, M.H. Road, Chennai, Chennai, Tamil Nadu - 044 25522451

rkk forex and services pvt ltd

43, first floor sarathy nagar, Chennai, Tamil Nadu 600042 - 044 4201 2134

Trans Corporation International Western Union

No.87 Arcot Road,Saligramam, Opp. to Avichi School, Chennai, Tamil Nadu 600093 - 044 43544529

Nikon Foreign Exchange

No. 27/1, Palani Andavar Koil Street, Chennai, Chennai, Tamil Nadu 600026

Anwar Money Exchange

No. 5, Thyagaraya Road, Kodambakkam, Thyagaraya Road, Theyagaraya Nagar, Chennai, Chennai, Tamil Nadu 600024 - 09840183600

Elite Forex Private Limited

No. 174, Shop No. 3, 1st Floor, Doshi Garden, Arcot Road, Vadapalani, Chennai, Chennai, Tamil Nadu 600026 - 044 22322288

Wall Street Finance Ltd

715 A, Mount Chambers, Mount Road, Chennai, Tamil Nadu 600002 - 044 28521693



Exchange Risk Management
(Foreign Exchange Brokers - Chennai)
Contact: RAGHUNATHAN P V
L10/4 27th Crs St Besant Ngr-600090. Phone: 044-24910121

For X Change
(Foreign Exchange Brokers - Chennai)
Contact: B O: F-1 1st floor 48-B, First Mn Road Gandhi Nagar-600020. Phone: 044-24421426
ffmc@iccaps.com ffmc@iccaps.com

Forex Ltd
(Foreign Exchange Brokers - Chennai)
Contact: VENKATRAMAN
3 N H Rd-600034. Phone: 044-28279901

G A Vasant (Exchange)
(Foreign Exchange Brokers - Chennai)
Contact: DARMENDRA
179 New 308 Thambu Chty St-600001. Phone: 044-25222881

Kothari & Sons
(Foreign Exchange Brokers - Chennai)
Contact: PAUL DAS
112 Mahatma Gandhi Salai Nungambakkam-600034. Phone: 044-28274599
Lakshmie & Sons
(Foreign Exchange Brokers - Chennai)
Contact: HARIKRISHNA
10 Kondi Chty St-600001. Phone: 044-25385015

LKP Merchant Ltd
(Foreign Exchange Brokers - Chennai)
Contact: VENKATAPATHY
769 Anna Salai-600002. Phone: 044-28550886

M R D Money Exchange Pvt Ltd
(Foreign Exchange Brokers - Chennai)
Contact: ELANGO
11/11A 604 Pondy Bazaar T Ngr-600017. Phone: 044-24322968

Prithvi Exchange

Prithvi Exchange, offers a whole gamut of foreign exchange and money transfer services and is licensed by Reserve Bank of India as a full-fledged money changer.

33 Montieth Road,
Egmore
Chennai - 600 008
Tel:+(91)-(44) 28415434


Dass India Money Changer (Pvt) Ltd.

Dass India Money Changer Pvt. Ltd., one of the leading foreign exchange dealers in South India, offering a host of comprehensive foreign exchange related services.

3, Second Line Beach (Dass India Towers) Parrys
Chennai - 600 001
Tel:+(91)-(44) 42166604


Seven Forex & Travels India Pvt Ltd

Located near Gemini flyover right in the heart of famous tourist and commercial centres, it provides a comprehensive range of travel related services under one roof like International and Domestic Air ticket.
30, Plaza Centre, 129, G.N.Chetty Road,
Chennai - 600 006.
Tel:+(91)-(44) 28251777 / 45544680


Coramandel Forex & Financial Services P Ltd

Buying and Selling of foreign currencies challenging rates and door step service..

No:510/164, T.T.K.Road (Opp to Ambika Woodland Hotel), Alwarpet,
Chennai - 600 018
Tel:+(91)-(44) 42111477


Sri Vari Money Exchange P Ltd

Providing Money Exchange facility for Buying & Selling of Foreign Currencies and Travellers Cheques, Prepaid Forex Cards,

Shop No.18/19, "Jain Plaza", Ground Floor, No.63, Sir Thyagaraya Road, T.Nagar,
Chennai
Tel:+(91)-(44) 42605010,

Forex Trading For Beginners - 10 Facts You Need to Know For Forex Trading Success

This article is all about forex trading for beginners and facts you need to know before you start trading. You can make a lot of money but keep in mind most traders lose but by being aware of these facts and getting the right forex education, you can win...

Let's look at our list of key facts for forex traders for beginners.

1. Forex Robots are NOT a Route to Success

More novices buy a robot and think it will give them riches with no effort and they end up disappointed - Why? Because most have never even been traded and present worthless paper simulations which mean nothing in the real world. There not real profits so avoid them at all costs.

2. Forex Day Trading Doesn't Work

It's obvious that you can't tell what countless millions of traders, will do in short time spans. It's a good story and vendors know this but like the robots they only have paper simulations.

3. Anyone Can learn to Succeed

This the good news! Forex trading is a learned skill and if you get the right forex education, you can win.

4. You Need to Have Confidence and Discipline

This means accepting responsibility and learning the right information. Only then will you have the confidence to trade with discipline. So by all means get education from other - but success rests on your shoulders.

5. Big Forex Trends are Always Present

They last for weeks, months or years and if you use a long term forex trend following strategy, you can make huge gains.

6. Leverage is an Advantage and Disadvantage

Forex brokers will give you 200:1 as standard and most traders use it all. This is a mistake, over leverage simply wipes out more traders than any other reason. 10 - 20: 1 is plenty for most traders.

7. Markets Don't Move to Science

You will read a lot about how they do and how you can follow a system that predicts and win, no you can't. Markets don't move to science, they are simply an odds based game and you need to trade the odds to win.

8. You are Going to Face Periods of Losses

All the best traders do and it's how you handle them that will determine your trading destiny. Make sure you have strict money management and the confidence and discipline, to ride these periods out.

9. You Don't Need to be Clever or Work Hard

It's a fact that a simple trading strategy can be developed by anyone and you can make a lot of money with it. A few weeks to learn and about 30 minutes a day is all you need - if you get the right education. No other business, gives you such great rewards for your effort. You get rewarded for being right, not effort in forex trading and that means working smart NOT hard.

10. Ignore the Majority View and You Will be Successful

Forex trading success is all about ploughing your own path and ignoring the frequent myths you see online and also be prepared to not run with the majority - the majority of course lose, go your own path.

You Can Achieve What You Want

Want a good second income or even a life changing one? Well the opportunity is there for you and it's up to you what you achieve. Forex trading for beginners, sometimes seems daunting - but if you have read the above, you know what to do and can get on the road to financial success.

article source : http://www.articleblast.com/Money_and_Finance/Investing/Forex_Trading_For_Beginners_-_10_Facts_You_Need_to_Know_For_Forex_Trading_Su

Learn Forex Trading In An Innovative And Easy Way

Why Learn Forex trading?The forex market is by far the largest market in the world. It is estimated that around $1.5 TRILLION is traded every single day. By far more then all the stock, bond and futures markets of the entire world combined! Forex or currency exchange is the term used to describe the trading of world currencies. A trade occurs when a trader simultaneously buy of one currency and sell of another one. E.g., to buy British pounds with US dollars. The currency combination used in a trade is called a pair.What does a forex trader do? Simple, buy a currency at a low value and sell it at a higher value, and in the process profit from it! For example, buy Great British Pounds with US Dollars, wait for the Pound rate to go up and make money! This can be done several times a day if the forex trader is a day trader or several times a week or month if the trader is a forex swing trader.What are the main benefits of trading in the forex market?Many currency pairs are very volatile. Volatility means that they move a lot during the day, from side to side, allowing traders to capture sometimes 5-6 price swings per day, each one potentially allowing the trader to make impressive profits.5-7 currency pairs to monitor (instead of over 10,000 stocks!), no commission trading, guaranteed fills for stop losses and limit orders, impressive leverage. The forex market is a 24 hour market. Never stops. This means that as a forex trader you can chose exactly when to trade. Some traders have day jobs and do not have the necessary time to trade during the day so they can trade at night. People who make their living as forex traders can chose to trade any time of the day or night. The point being, a 24 hour market allows the trader a lot of flexibility.What are the Exclusive benefits offered by forex trading?An incredible benefit of the forex industry is that today all forex brokers allow traders to open free demo accounts. This demo account has the full capabilities of a "real" account including live market rates, access to real-time market analysis, and the ability to execute trades off streaming prices. This means that the trader can test his or her strategies without risking a single dollar! No other business opportunity allows you to see if it works before you spend money!Making a living as a forex trader allows you to be truly free! No office, no workers, no inventory, no marketing worries, no advertising, no selling. Learning the right forex trading system allows the forex trader to trade by just following simple rules. If A happens and B happens then do C. This is called mechanical trading. It requires absolutely no discretion, interpretation or thinking from the trader.In conclusion, Learning forex trading provides all level of investors with a lot of opportunities that many markets and industries do not provide. The reason many people have not heard of this opportunity until recently is that until not long ago trading currencies was reserved to the big dogs (banks, institutions, companies etc). Today with the help of the internet anyone can take advantage of on-line currency trading that was once reserved to an exclusive group.

Forex Trading Tips - 4 Tips You Must Understand to Win at Forex

Here are 4 Forex trading tips that if you understand them, can allow you to enter the elite 5% of winners who make big long term consistent profits. Anyone can learn currency trading and win but these 4 points need to understood - here they are...

1. You are Responsible

If you think you can buy success think again, you can't. Most traders think Forex trading can be done with no effort buy a junk robot with a simulated track record and think they will make the same gains sorry, it's not that easy. Forex trading sees 95% of traders lose and is not a walk in the park.

While anyone can learn Forex trading, you need to get the right education and skills but first you need to understand what the Forex market and how prices move, which leads to the next point.

2. Understand Markets are an Odds Game

Many traders think you can predict prices and believe so called experts, who say it's possible. Its not and your predictions will be as accurate as your horoscope if you try. Neither do they move to a scientific theory as many claim; if they did we would all know the price in advance and there would be no market!

You need to understand that winning at Forex, is all about trading probabilities not certainties. You need to understand you won't win every time and will have periods of losses - but if you always trade the odds, you can make a lot of money. Now let's look at the type of Forex strategy you need.

3. A Simple System is All You Need

Your Forex trading system should be simple, robust and easy to understand.

Don't believe anyone who tells you complicated methods are better there not, as they have too many elements to break and science (no matter how clever) won't help you when you're trading an odds based market.

Get a simple trading system - it's easy to do and now we will move onto the final point which is the challenge you must overcome and if you can, you can make huge profits.

4. Discipline is the Key

A method by itself is not enough, you must have the discipline to execute it through periods of losses, until you hit profits again and this can be tough. It's hard to keep executing your trading signals when the market gives you losses and makes you look a fool. Most traders simply let their emotions and ego get involved and lose.

Being disciplined at all times and employing strict money management, is the key to winning longer term and its not easy but it can be done, if you have confidence in what you are doing and have the right forex education.

It's Not easy to Win

You can win though, anyone can. The fact it's not easy to win, means the rewards are huge and you can get your share of them, if you want too.

Forex trading means you have to get the right education have confidence in what you are doing and trade with discipline. Accept this and take responsibility for your actions, and your on your way to Forex trading success.
article source : http://www.articleblast.com/Money_and_Finance/Investing/Forex_Trading_Tips_-_4_Tips_You_Must_Understand_to_Win_at_Forex/ 

Forex Price Movement - How and Why Prices Really Move and How to Win

Forex price movement is misunderstood by most traders. Prices don't move in line with the news and they don't move to some mystical recurring scientific theory either. You can win but understand the key reason prices move or lose...

Here is a simple equation for forex price movement.

Fundamental Supply and Demand inputs + Investor Perception = Price.

Simple enough but most traders fail to see the significance of the above which is:

- The news and facts are un-important its how traders perceive them as a whole that is.

- Humans are emotional so you cannot predict what they will do.

Those traders who think they can trade breaking news are wrong and they don't understand the markets discount news instantly furthermore, we all have the same facts to see but we all draw different conclusions from them.

How Markets Really Move

As humans are emotional, there is no way of predicting forex prices in advance or some mystical scientific theory they move to which the far out investment crowd love with their Fibonacci, Gann and Elliot Wave based systems.

If you want to trade forex, you need to see it as an odds game and play the odds when there in your favour, run your profits and cut your losses. Sure, human nature means you cannot predict exactly what will happen next - but human nature is constant and we are all governed by greed and fear and this means you get hig odds formations which can be traded for profit.

Keep It Simple and Trade the Odds for Success!

All you need to do is - use a simple odds based forex trading strategy and have good money management and you can win.

Today traders make forex price movement much more complicated than it really is, traders try and apply ever more complex formulas and software to try and crack the code behind forex price movement but it's all in vain - there isn't one!

Complex Systems and Maths are NOT the Answer

This is proven by the fact that 50 years ago 95% of traders lost and the same ratio lose today; showing that advances in technology have not helped at all.

This leads to the obvious conclusion that forex trading success is not dependant on being clever, complex or the application of maths and of course this is true - its NOT and the fact we have just given you, clearly shows this.

How to Enjoy Success

Forex trading success is simply based upon a combination of a simple, robust forex trading strategy, with good money management which you can apply with discipline. Forex trading is an odds based market and if you learn to trade the odds, you can make a lot of money and enjoy currency trading success.

Forex Robots - The Vital Facts About These Critters You Need to Know

Forex robots are popular, and to be sure the sales hype is very enticing, but there is a key point that overlooked and there are some vital fact you need to know.

Facts About Forex Robot Trading

Forex robots are without doubt a very important development in Forex trading. However there are some important facts that you should understand about trading with a Forex robot.

First off the robots are trading your money.

I know this may sound like a stupidly obvious statement but the fact is that no matter what method you choose to trade the Forex markets you will still be risking your own hard earned cash. This means that you need to know if your are ready to go to the market and risk real money, money that hopefully you can afford to lose.

With That Out Of The Way...

The fact is that emotions play a huge role in trading, fear and greed are an every day reality when it comes to trading and they can wreck havoc on your trading results by forcing you to make moves that are contrary to a sound trading plan.

Knowing This Truth...

The truth is that trading robots, also known as Expert Advisor software, can help substantially reduce emotional trading. They do so by removing the need to have your nose glued to a computer screen during active trading times. This removes the emotional stimulus that comes from watching every toss and turn and market hiccup.

The Truth About Expert Advisor Software (aka Trading Robots)

The fact is that every piece of Expert Advisor software was developed by humans. And humans are not perfect and neither will their products ever be as well. This means that if you are expecting a piece of software to "never lose," then you are in for a rude awakening.

How It Works In The Real World...

The fact is that every trading robot wins some and loses some, it is just that some are better at it than others. And at the end of the day, it is really about winning more money than you lost, that is the real world trading actually works.

And it should be understood that each piece of software is optimized a bit differently, so that each one responds differently to each type of market, say a bullish market, or even to a particular currency pair.

What You Really Need To Know About Forex Robots...

The fact is that correctly chosen, Forex robots can be a real asset to Forex trading. However choosing one that matches your personality, and trading goals, along with the current market can be a bit tricky, and to be sure there are some frauds on the market (some with very big names), which makes the process of choosing the correct one a bit confusing and costly.

Fortunately there is a great resource available on the web. If you would like an independent forex software review on currently available trading robots, including user reviews with profits and losses, click to http://www.forexproductsconsumerreports.com a consumer report site on Forex products.

Forex Trading - Poker Players Often Become Trading Millionaires the Skills Needed Are the Same

 If you thought that poker paying couldn't teach you much about forex trading you would be dead wrong. If you can play poker successfully you can trade and win because there is a unique mindset needed for both. Even if you don't play poker you will learn the skills needed from this article.

Any successful poker player will tell you that to win you need to know when to bet ( when the odds are in your favour) how much to bet and when to quit, to preserve equity and the skills needed are neatly summed up in the old gamblers saying:

"There's a time to hold them a time to fold them and a time to get out of town fast"

The successful poker player relies on himself there is no one to help him at the table (contrast this with most forex traders who trust mentors gurus or junk robots) and they rely on tremendous discipline to not trade at all, or quit and take a loss and keep their losses small (contrast this with the forex trader who hates admitting their wrong), now you can see why they make great traders.

Trading relies on you - no one else can help you.

You must get the right education and have confidence in it and then the hard part - apply your trading system with discipline in the market. Just like in poker your playing the odds not the certainties, many guru's would have you believe.

You have to have total confidence in what you are doing and the equation for market success is:

Logical well thought out method + the discipline to execute it = forex market success.

If you don't have the discipline to execute your trading system - you may as well not have one!

The poker player will take loss after loss - but he will have the confidence and discipline to know that his time will come, when he can load up his trades and win big. Most traders simply cannot take a strong of losses but that's part of trading and you must do this.

You need to understand you have to lose to win.

Forex trading is actually quite simple anyone can learn to trade currencies but 95% of traders lose. The reason is not because they can't learn to trade, it's because they like to follow others or want to win all the time.

They simply don't have the discipline, or mindset to win and the poker player does.

So learn this:

You need to stand on your own two feet. No following others or believing all the hype that forex trading is easy - its not.

You then need to have confidence in what you're doing, to give you confidence and the discipline to preserve your equity by taking small losses and wait for your opportunities and run them to big profits, when they come.

So if you play poker successfully or for that matter blackjack, then you already have the traits needed to win. If you don't play poker you will see the logic of the material enclosed and can incorporate it in your forex trading strategy and seek forex trading success.

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Forex and Stock Market - Find the Difference

What is the difference between stock market and Forex? Which one is better opportunity to make money? These are the common questions beginner traders ask. There is no common answer to this question. Everything depends on trader's preference and his motives.

We should remember that success of the workers in financial institutions depends on how many people they attract into the business of trading and how many transactions these clients make. They have direct financial interest therefore their opinions can be biased. Some of the widely known opinions are:

In Forex traders burn out much quicker than in stock market.

There are trading systems that allow anyone to become a millionaire quickly.

Let's consider these opinions more closely. I couldn't find any reliable statistical data about participants in Forex and stock market that would have the following parameters.

1. The number of traders who start trading. Percentage of traders who continue to trade after one, two and tree years. How successful their trading is.
2. Relationship between beginning balance of their account and ending balance.
3. Relationship between method of trading and success rate.

There is no reliable statistics on these parameters. Only opinions and estimated guesses. The reason for the absence of such statistical data is understandable. It's a commercial secret. Nevertheless I can confidently say that there is no dramatic difference between trading Forex and trading stocks. There is no difference in opportunities to earn money as well to lose money in those markets. There is no or very little difference between them because in financial market you trade risks and probabilities not currencies, stocks and futures. The difference can be only in the rules of game, methods of execution of transactions, and liquidity of the market.

Now let's talk about magical trading systems that allow you quickly and safely become a millionaire. They may say the system is a work of genius and sell it to your for some amount of money. Do you believe in it? It's true that you can't work in market without a system. Therefore any system has a right to exist. I don't believe in magical systems or universal machine that will make you money while you sleep.

You can make money with any system if they are based on mathematics, psychology and discipline. It's not important what the system uses. It can use good old indicators like RSI or MACD. Or they may be built on some new indicators. You even can base your trading system on the number of blond women you meet on your way to office. But if you don't have a discipline to implement it consistently no system will help you.

There are many more different opinions about Forex and stock market. The one common thing is that you can make money in any market. The only thing you need is to make well thought decisions and have a discipline to follow through with them.

Albert Schmidt is a part-time currency trader. After quite a long time of struggle he learned to make consistent profit trading in Forex. Review a trading strategy he successfully uses in his trades.

Picking a Forex Trading Online Software

There are literally millions of people forex trading online in the currency markets on any given day. This wasn't the case 10 years ago but the growth in this investment vehicle has been exponential. One of the reasons has been that so many people have been successful at it. Success breeds copy cats and competition. The most successful currency traders are using software to help them make their trades. Not only to process the transaction but to choose which currency pair and when and what stops.

When choosing a forex trading platform you need to test drive it before you ever buy it. This is the norm in today's market. There are several companies that are more than happy to let you download a demo and setup a dummy account and run their software. This is important because every software looks different and has different features. Some are horrible to look at and some look like you wrote it yourself, almost perfect.

But testing it in real time with real data is THE MOST IMPORTANT feature of any software that you end up choosing. You need to test it to see if it gets your orders in time and gets out of the markets where you set your stops. Not all softwares are equal in this most important of aspects, and it can cost you big time if the software blows through your stops.

As I said earlier you should be comfortable with the way the software looks and the location of the buttons you need to click on. It should be laid out in a logical manner so that if things happen quickly you can easily get out or get into a currency market. You don't want to have to click on 3 different screens to place a trade or to get out of one, especially in the forex markets where things move faster than stocks.

After seeing that the software works and looks alright check out the different strategies that are built into the software. There are a number of normal charting strategies that all platforms have, but if you have purchased a piece of software it should be programmed with its own specialty. This is the deal maker. Does the software's technique make money. This can be easily tested since you will be running a demo. Run the demo a minimum of 2 weeks but try for a month.

Some software companies let you use real data from the past to test your own new strategies and this can be worth the software price in and of itself. Especially if you are creative and are coming up with new ideas. If you study the forex markets you will find out that there are several popular strategies but there has to be a BEST STRATEGY. Do you think you can discover it? You might as well try if you bought the software anyway.

Finally, after you have chosen the forex trading online software you must find out what the company offers in terms of safety of data encryption and what do you do if your computer crashes. Who do you call? Do you call a specific person? This is really very important, you don't want to be in the middle of a transaction and the power goes out and you are only part way in and have no stop or target to get out. So find out who and what you must do in emergency situations.

There is another software option that I haven't covered here. It is called Forex Robots. They make trades without you having to be there, so they can trade 24 hours a day. I will leave that for another article but it is something else you should look into.

Bob Perry is a freelance writer specializing in the financial markets. He has experience with currency markets and stocks. Check out his blog at ForexTradingOnlineBlog.com for more informative articles and tips on making money.

Forex trading basics

Forex Market Basics

The Foreign Exchange market (also referred to as the Forex, FX market, "Cash" Forex or Spot Forex market ) is the largest financial market in the world, with more than $1.5 trillion changing hands every day — 30 times larger than the combined volume of all U.S. equity markets. Another major feature of the Forex market is that it operates 24 hours a day, corresponding to the opening and closing of financial centers in countries all across the world, starting each day in Sydney, then Tokyo, London and New York. At any time, in any location, there are buyers and sellers, making the Forex market the most liquid market in the world.

What to trade in Forex Market?

In the forex market, currency trading is always done in currency pairs, such as EUR/USD or GBP/USD. Accordingly, all trades result in the simultaneous buying of one currency and the selling of another. The base currency is the "basis" for the buy or the sell. It is useful to consider the currency pair as an instrument, which can be bought or sold.

Understanding Forex quote


Base currency: The first currency in the pair.
Counter Currency: The second currency in the pair. Also known as the terms currency.

The US dollar is the centerpiece of the Forex market and is normally considered the ’base’ currency for quotes. This includes USD/JPY, USD/CHF and USD/CAD. For these currencies and many others, quotes are expressed as a unit of $1 USD per the second currency quoted in the pair. For example, a quote of USD/CAD 1.1302 means that one U.S. dollar is equal to 1.1302 Canadian dollar.

BID and ASK Prices

When trading forex you will often see a two-sided quote, consisting of a ’bid’ and ’ask’. The ’bid’ is the price at which you can sell the base currency (at the same time buying the counter currency). The ’ask’ is the price at which you can buy the base currency (at the same time selling the counter currency).

Commission-free, but with spreads

Most Forex brokers offer commission-free Forex trading. Spread - The difference between the bid and ask price of a currency. Normally 3-5 pips on the Majors.

Rollover - What happens to my open positions at the end of the trading day?

Process whereby the settlement of a deal is rolled forward to another value date. The cost of this process is based on the interest rate differential of the two currencies. Most brokers will automatically roll over your open positions, allowing you to hold a position for an indefinite period of time.

Leverage & Margin

The leverage available in forex trading is one of main attractions for many traders. Leveraged trading, or trading on margin, simply means that you are not required to put up the full value of the position. Forex brokers provide more leverage than stocks or futures. In forex trading, the amount of leverage available can be up to 400 times the value of your account.

The Forex Market and Understanding Foreign Exchange Rates

Unlike the stock exchange, the Forex Market (foreign exchange market) is a relatively new player to the investment world. Today's current Forex market model started in the early 1970's, and today it represents the biggest financial market around, even surpassing the stock market. With trading surpassing $2 trillion dollars per day, the Forex market attracts more and more investors all the time. Before an investor starts trading on the Forex market, he should grasp the fundamentals of how exchange rates work.

Exchange rates

Basically, the exchange rate represents the rate of exchange between two currencies. Most currencies are traded, or paired up against the dollar. The five most common currencies traded on the market are the dollar (USD), euro (EUR), the yen (JPY), the British pound (GBP), and the Swiss franc (CHF). Some other currencies that are traded are the Australian dollar, the Canadian dollar, and the Hong Kong dollar.

In the exchange rate or ratio, the numerator represents the quote currency and the denominator the base currency, which always equals one.

Let's say that an investor wants to exchange euros for dollars. In this case, the euro currency is the quote currency, or how much currency you have to exchange. The base currency is the dollar. The investor researches the current exchange rate (euros converted into dollars) either on the Internet, through the bank, broker, etc., and then multiplies that amount by the number of euros to exchange. Let's say that the exchange rate is 1.57959. That means that 1.57959 euros must be paid to receive one dollar. If he has 1000 euros to exchange, then he can receive $1,579.59 (1000 x 1.57959).

On the flip side, the exchange rate can also tell the investor how much he'll receive if he converts dollars back into euros. If he has $1000, he can either divide that amount by the same euro to dollar exchange rate ($1000/1.57959 = 633.07 euros), or look up the conversation rate for dollars to euros on the Internet, etc. (i.e. .633072) and multiply it by the amount of dollars to exchange ($1000 x .633072 = 633.07 euros).

Once the exchange rate concept is understood, the investor can feel more confident in investing in the Forex market.

Risks of Trading in Forex Market

Although every investment involves some risk, the risk of loss in trading off-exchange forex contracts can be substantial. Therefore, if you are considering participating in this market, you should understand some of the risks associated with this product so you can make an informed decision before investing.

As stated in the introduction to this booklet, off-exchange foreign currency trading carries a high level of risk and may not be suitable for all customers. The only funds that should ever be used to speculate in foreign currency trading, or any type of highly speculative investment, are funds that represent risk capital i.e., funds you can afford to lose without affecting your financial situation. There are other reasons why forex trading may or may not be an appropriate investment for you, and they are highlighted below.

The market could move against you

No one can predict with certainty which way exchange rates will go, and the forex market is volatile. Fluctuations in the foreign exchange rate between the time you place the trade and the time you close it out will affect the price of your forex contract and the potential profit and losses relating to it.

You could lose your entire investment

You will be required to deposit an amount of money (often referred to as a security deposit or margin) with your forex dealer in order to buy or sell an off-exchange forex contract. As discussed earlier, a relatively small amount of money can enable you to hold a forex position worth many times the account value. This is referred to as leverage or gearing. The smaller the deposits in relation to the underlying value of the contract, the greater the leverage. If the price moves in an unfavorable direction, high leverage can produce large losses in relation to your initial deposit. In fact, even a small move against your position may result in a large loss, including the loss of your entire deposit. Depending on your agreement with your dealer, you may also be required to pay additional losses.

Overtrading is another ordinary money management mistake in the forex market. This trading does not have clearly defined trading objectives; the sole reason is to make more money. To avoid this mistake, make sure that every trade is broken into ultimate goals, and that these goals are achieved before other positions are added. Very few traders can successfully manage multiple positions in a variety of currency trading markets.

Overconfidence is a big mistake when it comes to money management and the forex market. This is caused when a trader has or thinks they have particular or inside information. These hot tips are sometimes wrong, and when this happens large amounts of money may be lost because of this. The way to avoid this is to avoid being confident in any rumors or special information you may have. Managing your money means taking measures to preserve it as well.

Preferential bias can exist among forex market traders. This happens when they only see or hear what they want in relative to the favored trade. This can cause a trader to ignore the real activity of the forex market in favorite of what they want to happen. It is important to look at each trade impartially and do not become set in cement with your opinion. Do not ask friends or family for their opinions; just go with what you know.