Bearish Abandoned Baby

This Pattern signals a : Reveral
Reliability of this candlestick pattern: High



How to Identify:
Three candles are involved in forming this pattern. On a daily chart, here's how it will unravel:

1. 1st day is a bulls day (white candle)
   
2. 2nd day is undecisive day (doji) day - here the shadows of this day are above the first day.
   
3. 3rd is bears day (black candle) with no overlapping shadows
   

In the best setup - the shadows of doji should completely gap above the shadows of the first and third day.

Market Psychology:
Bulls were ruling on the first day and the second day's opening gap encourages them more - however, the Bulls having seen good profits start taking them off the market - pushing the close of the day near the open - thus forming a doji.

However, the third day open reveals that the second day was more of an indecision by the bulls to push their agenda - that gives bears the upper hand with the opening gap of the second day and thus the bears take over the market.

Global Forex Trading

Global Forex TradingGlobal Forex trading is a market that is linked throughout the entire world through a web of banks, corporations and independent investors. Because of this world wide market, global Forex trading relies on the fluctuations of currencies in every country. Having dealers in almost every time zone, including London, New York, Sydney, Hong Kong and Tokyo, a trade can be made anywhere at any hour. The keys to trading are contingent on many factors. With such a large network, global Forex trading is executed based on the economical, political and psychological factors of countries and of investors. How These Factors WorkAs always, the economic changes caused by unemployment, inflation and interest rates, play a large role in the rate a currency is at. It is crucial to watch and even anticipate these changes when choosing a trade, hoping that the rate of the currency you buy will increase after your trade. Alterations in a country's economic standing is one factor that must be expected, because it is this expectation that often changes the rate before the economic conditions even alter. Another anticipation that is significant is the mentality of other investors and their reaction to changes. The reactions of traders to the market must also be predicted because, usually large numbers of investors will make similar moves and affect the market.

New Zealand Dollar Short Term Bearish

Daily FX
New Zealand Dollar Short Term Bearish
Tuesday June 26, 8:03 am ET
By Jamie Saettele, Technical Currency Strategist strategist@dailyfx.com

Commentary: The rally from .7452 may also be the b wave of an irregular flat correction.

If this is the case, then price is likely to fall from close to current price towards .7452. The measured objective for the end of wave b is .7687/.7708, which is the 127%-138.2% of .7637-.7452. Daily RSI is overbought and divergent with the recent high as well.

The Gann Angles

Gann Angles: Time and Price Analysis

W.D. Gann (1878-1955) developed the use of what he called "Geometric Angles", now commonly referred to as Gann Angles, used to determine trend direction and strength, support and resistance, as well as probabilities of price reversal.

Gann was fascinated by the relation of time (T) and price (P). Gann drew his angles from all significant price pivot point highs and lows. He used just one pivot point to draw an angle that rose (or fell) at predetermined and fixed rates of speed, as follows:

T x P = n degrees 1 x 8 = 82.5 degrees 1 x 4 = 75 degrees 1 x 3 = 71.25 degrees 1 x 2 = 63.75 degrees 1 x 1 = 45 degrees 2 x 1 = 26.25 degrees 3 x 1 = 18.75 degrees 4 x 1 = 15 degrees 8 x 1 = 7.5 degrees

Where:

T is the number of units of time, graphically plotted on the horizontal x-axis.

P is the number of units of price, graphically plotted on the vertical y-axis.

x is read as "by".

n degrees specifies the slope of the Gann angle, measured in degrees.

Translating time by price into degrees assumes a square grid, where one unit of time on the x-axis takes up the same amount of horizontal space as the one unit of price on the y-axis takes up vertical space. For example, 1/16 of an inch might be set to one week of time on the horizontal x-axis, and 1/16 of an inch might be set to one dollar of price on the vertical y-axis. On such a proportionally scaled chart, the 1 x 1 geometric angle, which for every one unit of time rises one point in price, is a 45 degree angle.

Without this equality of time and price scaling, however, Gann angles stated in degrees do not work out correctly. That would not prevent correct Gann angles from being drawn on oddly proportioned grids; it would only prevent the translation of time by price angles into correctly-displayed degrees. But that would not affect the interpretation of the Gann angles if we avoid thinking in terms of degrees. Rather than thinking in terms of degrees, it is simpler to express Gann angles in terms of units of time by price.

For practical purposes, weekly Gann angles, drawn on a weekly bar chart, appear to offer the most useful perspective. Gann often said that the weekly chart was more important than the daily chart. Nevertheless, Gann angles are flexible and can be used on any time-scale, so long as the time by price proportions are correctly calculated.

Gann angles offer indications of support and resistance that may not be evident based on any other method. For example, during an up-trend, the 1 x 1 angle tends to provide major support. A major reversal is signaled when prices fall below the 1 x 1 angle. According to Gann, prices should then be expected to fall to the next angle below, the 2 x 1 angle. In other words, as one angle is penetrated, expect prices to move to and consolidate at the next angle, which is less steep.

Gann placed special emphasis on the 1 x 1 angle. On a perfectly proportioned time by price grid, in an uptrend, the 1 x 1 angle extends "northeast" at a precise 45 degree angle. This 1 x 1 angle is the most significant angle: it represents a sustainable, perfectly balanced trend, not too fast and not too slow, but just right. In a bullish uptrend, the 1 x 1 angle tends to provide major support. When this 1 x 1 angle is broken, a significant price trend reversal is signaled. The price should then drop down to test the 2 x 1 angle, below.

In a downtrend, the 1 x 1 angle extends "southeast" at a precise 45 degree angle. Eventually, after a downtrend, when price moves above and stays above the 1 x 1 angle (which is sloping down and to the right at 45 degrees), price should then make its way up to test the next, less-steep Gann angle, the declining 2 x 1 angle. An angle that provided resistance, once decisively broken, should provide support.

Furthermore, when a 1 x 1 angle crosses a horizontal line extending forward in time from a significant past pivot point price (an obvious high or low), then time and price are square relative to that past pivot point, and that is a likely time for a change in trend or an acceleration of the existing trend. Also, when a geometric angle crosses zero or another geometric angle, a trend change is likely.

Identification of the most important Gann angle is dependent of the price level of the instrument analyzed: very high and very low priced instruments will follow steeper and shallower Gann angles, respectively. In other words, the best functioning Gann angle for support and resistance depends on the price level of the instrument being analyzed.

For example, for the S&P 500 Composite Stock Price Index, a relevant support and resistance price channel was well defined by 2 x 1 weekly Gann angles from the 8/9/82 price low at 102.20 until 1995. After the 12/9/94 low at 442.88, the S&P price level quickly rose so high that the bull market trend was better defined by the rising 1 x 4 weekly Gann angles. A glance at the chart should make obvious the value of these Gann angles, which can be drawn before the fact, as soon as the user can identify a pivot point high or low. (See Robert W. Colby's book, page 285, for this chart.)

Gann also divided significant price and time ranges and previous highs and lows into eighths, and looked for support and resistance there. For example, dividing the low to high price range after a substantial upswing, the most important divisions would be 8/8 (or the high), ½ (the midpoint) and 0/8 (the low). Next most important would be 3/8 and 5/8. Expressed in decimals, 3/8 is 0.375 and 5/8 is 0.625, which are only .007 away from the Fibonacci ratios of 0.382 and 0.618.

Note: The above is an excerpt from The Encyclopedia of Technical Market Indicators, Second Edition, McGraw-Hill Publishing, 2003

This is a pic of him :

10 Essentials Forex Trading .

As a newbie...i just want to share 10 assentials forex trading that i read from other forex blog hese 10 Forex trading essentials are a high-level peek at the pitfalls that catch many traders. Compare your trading style with these simple fixes and if you are not employing some or all of them, you are placing yourself at a higher risk level.

1) Increase your time perspective - If you are not a well seasoned Forex trader, you shouldn't even look at a price chart of less than 60 minutes. The randomness of the normal transactions which occur in Forex will distort your judgment of the true picture. Use longer time frames, such as 60 minute, 4 hour and daily charts when planning your trades.

2) Reduce your position size to 5% Maximum - Having more than 3 to 5 percent of your trading capital on the table is a major no no. High leverage makes it very easy to get in away over your head. This combination snares many traders and can rapidly destroy your account. You need to have the ability to ride the volatility waves common in Forex.

3) Give your trade time to work - You can only use this option effectively if your position is sized safely... as per 2) above. Prices will fluctuate dramatically in Forex, and you need to be sure that a loss really is a loss before you close a trade that is moving against your plan. A 30 pip stop loss will often kick you out of a trade, just as it's about to turn in your direction. You need to allow for larger price swings... if you have determined the major price trend, be patient and let the odds work in your favor.

4) Reduce your dependence on technical indicators - Due to the fact that technical indicators get their data from past events, the reality is they have no ability to predict the future. Pro's that enjoy success using these indicators, often profit from the knowledge of how the masses are likely to react to this data, rather than the information itself. You need to determine the major trend (a simple moving average will show you this) and hop aboard. Use a longer time frame, as in 1). The largest players in Forex rely about 25% on technical indicators when making their trading decisions.

5) Trade only one or two currency pairs - And stick to the majors... not the crosses. Currency prices are driven primarily by fundamental data. In order to anticipate what is likely coming down the road, you need to follow some basic data for each of the countries involved. Trading too many currencies will make it difficult to keep up to date. There is equal opportunity to profit from each of the pairs, so wait until your experience level has matured and the information tends to sink in without as much effort on your part before you start to trade more currencies.


6) Average in and out of your trades - If your trading account is less than $50,000 have your broker enable mini-lots for your account. This will allow you to average in and out of your trades... a great way to add more flexibility to your account. If this applies to you and your broker doesn't offer mini lots, find a new broker... this is an important need to do.

7) Follow the data for your currency pair(s) - Know what data is pending for release. Volatility often increases dramatically when these releases occur. The safe strategy is to exit your positions prior to major releases... this is the way many of the larger accounts handle these situations. Data releases can often cause a change to the trend. Take them seriously. Determine the trend and get aboard - As with any type of trading, the safest bet is to determine which way prices are trending, and then trade in that direction.

8) You don't need anything fancy... a simple moving average on your candlestick chart is sufficient. Zoom your chart out to be sure you have the big picture. Compare where the price is now, relative to where is has been for a significant amount of time (at least a month). Use caution if the current price is near upper or lower extremes, as there may be a trend change once that extreme is reached.

9) Know when to take a profit - A winning position can quickly turn into a loser if you set your sights too high. Don't be afraid to take your profit - or a part of your profit at 20 or 30 pips. The price waves in Forex make it ideally suited to averaging into and out of positions by using multiple entry and exit points for each position. This is exactly where your mini lots can help! The benefit of spreading out your position is that your overall risk is reduced.

10) Stop listening to 'Gurus' - Don't fall into the trap of believing everything, or even most things, you hear. The trading world is overflowing with gurus only too willing to offer their opinion on the future. It will only be an opinion, nothing more. They may seem to have convincing data, but trust your own brain. You need to weigh the economic data from your countries... that is what drives currency prices. The enormous size and nature of Forex ensure there is no insider information. You have access to the same data as everyone else in the game. In time, your own instinct will guide you to your goals, and that is what you need to trust.

Candlestick chart

A candlestick chart is a style of bar-chart used primarily to describe price movements of an equity over time.

It is a combination of a line-chart and a bar-chart, in that each bar represents the range of price movement over a given time interval. It is most often used in technical anylsis of equity price patterns. They appear superficially similar to errors, but are unrelated.

History

Candlestick charts are said to have been developed in the 17th century by legendary Japanese rice trader . Muneshia Honma The charts gave Honma and others an overview of open, high, low, and close market prices over a certain period. This style of charting is very popular due to the level of ease in reading and understanding the graphs. Since the 17th century, there has been a lot of effort to relate chart patterns to the likely future behavior of a market. This method of charting prices proved to be particularly interesting, due to the ability to display four datapoints instead of one. The Japanese rice traders also found that the resulting charts would provide a fairly reliable tool to predict future demand.

Candlestick Layout

Canadalestick are usually composed of the body (black or white), an upper and a lower shadow . The wick illustrates the highest and lowest traded prices of a stock, and the body the opening and closing trades. If the stock went up, the body is white, with the opening price at the bottom of the body and the closing price at the top. If the stock went down, the body is black, with the opening price at the top and the closing price at the bottom. A candlestick need not have either a body or a wick.

Patterns

There are multiple forms of candlestick chart patterns, with the simplest depicted at right. Here is a quick overview of their names:

1. White candlestick - signals uptrend movement (those occur in different lengths; the longer the body, the more significant the price change)
2. Black candlestick - signals downtrend movement (those occur in different lengths; the longer the body, the more significant the price change)
3. Long lower shadow - bullish signal (the lower wick must be at least the body's size; the longer the lower wick, the more reliable the signal)
4. Long upper shadow - bearish signal (the upper wick must be at least the body's size; the longer the upper wick, the more reliable the signal)
5. Hammer - a bullish pattern during a downtrend (long lower wick and small or no body); Shaven head - a bullish pattern during a downtrend & a bearish pattern during an uptrend (no upper wick); Hanging man - bearish pattern during an uptrend (long lower wick, small or no body; wick has the multiple length of the body.
6. Inverted hammer - signals bottom reversal, however confirmation must be obtained from next trade (may be either a white or black body); Shaven bottom - signaling bottom reversal, however confirmation must be obtained from next trade (no lower wick); Shooting star - a bearish pattern during an uptrend (small body, long upper wick, small or no lower wick)
7. Spinning top white - neutral pattern, meaningful in combination with other candlestick patterns
8. Spinning top black - neutral pattern, meaningful in combination with other candlestick patterns
9. Doji - neutral pattern, meaningful in combination with other candlestick patterns
10. Long legged doji - signals a top reversal
11. Dragonfly doji - signals trend reversal (no upper wick, long lower wick)
12. Gravestone doji - signals trend reversal (no lower wick, long upper wick)
13. Marubozu white - dominant bullish trades, continued bullish trend (no upper, no lower wick)
14. Marubozu black - dominant bearish trades, continued bearish trend (no upper, no lower wick)

Reversal Patterns

Prior Trend

For a pattern to qualify as a reversal pattern, there should be a prior trend to reverse. Bullish reversals require a preceding downtrend and bearish reversals require a prior uptrend. The direction of the trend can be determined using trendlines, moving averages, or other aspects of technical analysis.

Hammer and Hanging Man

The hammer and hanging man look exactly alike but have totally different meaning depending on past price action. Both have cute little bodies (black or white), long lower shadows and short or absent upper shadows.

The hammer is a bullish reversal pattern that forms during a downtrend. It is named because the market is hammering out a bottom.

When price is falling, hammers signal that the bottom is near and price will start rising again. The long lower shadow indicates that sellers pushed prices lower, but buyers were able to overcome this selling pressure and closed near the open.

Word to the wise… just because you see a hammer form in a downtrend doesn’t mean you automatically place a buy order! More bullish confirmation is needed before it’s safe to pull the trigger. A good confirmation example would be to wait for a white candlestick to close above the open of the candlestick on the left side of the hammer.

Recognition Criteria:

• The long shadow is about two or three times of the real body.
• Little or no upper shadow.
• The real body is at the upper end of the trading range.
• The color of the real body is not important.

The hanging man is a bearish reversal pattern that can also mark a top or strong resistance level. When price is rising, the formation of a hanging man indicates that sellers are beginning to outnumber buyers. The long lower shadow shows that sellers pushed prices lower during the session. Buyers were able to push the price back up some but only near the open. This should set off alarms since this tells us that there are no buyers left to provide the necessary momentum to keep raising the price. .

Recognition Criteria:

• A long lower shadow which is about two or three times of the real body.
• Little or no upper shadow.
• The real body is at the upper end of the trading range.
• The color of the body is not important, though a black body is more bearish than a white body.

In conclusion, by understanding all these points you should be ready for the real time.

I wish you a very good luck on your investment.

What is a Candlestick?

What is a Candlestick?

Back in the day when Godzilla was still a cute little lizard, the Japanese created their own old school version of technical analysis to trade rice. A westerner by the name of Steve Nison
“discovered” this secret technique on how to read charts from a fellow Japanese broker and Japanese candlesticks lived happily ever after. Steve researched, studied, lived, breathed, ate candlesticks, began writing about it and slowly grew in popularity in 90s. To make a long story short, without Steve Nison, candle charts might have remained a buried secret. Steve Nison is Mr. Candlestick.

Okay so what the heck are candlesticks?

The best way to explain is by using a picture:

Candlesticks are formed using the open, high, low and close.

• If the close is above the open, then a hollow candlestick (usually displayed as white) is drawn.
• If the close is below the open, then a filled candlestick (usually displayed as black) is drawn.
• The hollow or filled section of the candlestick is called the “real body” or body.
• The thin lines poking above and below the body display the high/low range and are called shadows.
• The top of the upper shadow is the “high”.
• The bottom of the lower shadow is the “low”.

Forex Market Introduction

Money or currency is the ultimate commodity. Every time a company or government buys or sells products and services in a foreign country, they are subject to a foreign currency trade; the exchanging of one currency for another. Many individuals and organizations also trade currencies for speculative purposes. With all of these currency transactions going on daily, it is no wonder that the foreign currency exchange market, also known as "forex" or "fx" market, is the largest financial market in the world. It is much bigger than all of the U.S. stock markets combined, with a daily trading volume larger than that of all the world's stock markets put together.

Trillions of dollars of foreign exchange activity takes place every day. From 1997 to the end of 2000, daily forex trading volume surged from US$5 billion to US$1.5 trillion. The forex market continues to grow at a phenomenal rate.

Before the internet came along, only corporations and wealthy individuals could trade currencies in the forex market through the use of the proprietary trading systems of banks. These systems required as much as US$1 million to open an account. Thanks to advancements in online technology, today investors with only a few thousand dollars can have access to the forex market 24 hours a day.

For traders, forex trading provides an alternative to stock market trading. While there are thousands of stocks to choose from, there are only a few major currencies to trade (the Dollar, Yen, British Pound, Swiss Franc, and the Euro are the most popular). Forex trading also provides a lot more leverage* than stock trading, and the minimum investment to get started is a lot lower. Add to that the ability to choose flexible trading hours (forex trading goes on 24 hours a day) and you have the reason why so many stock traders have flocked to day trade currencies.

What is Forex ?

The Foreign Exchange market, also referred to as the "Forex" or "FX" market, is the largest financial market in the world, with a daily average turnover of approximately US$1.5 trillion. Foreign Exchange is the simultaneous buying of one currency and selling of another. The world’s currencies are on a floating exchange rate and are always traded in pairs, for example Euro/Dollar or Dollar/Yen.

Profiting With Forex

Profiting with Forex is today's most comprehensive guide to the enormous potential of Forex, the world's largest market. This expertly written resource explains how the global foreign exchange market works…which investing tools, techniques, and strategies have been used with great success in this market…and how you can generate profits in Forex, whether the other markets are up or down.
From the basic characteristics of the Forex market…to the full range of sophisticated investing methods, Profiting with Forex provides practical tips and guidelines for trading in this fast-paced world. This expert reference describes how businesses use Forex and shows how that experience can benefit both individual and institutional investors.

Written by two leading Forex experts, this complete investing resource uses basic economic principles, solid technical analysis, and lots of common sense to develop an arsenal of tools and techniques that will lead to winning results in the lucrative foreign exchange marketplace. Profiting with Forex includes everything that investors need to know about:
The many advantages of the Forex market_huge market size, ease of entry, profit potential, tax incentives, 24-hour trading, no commissions, increased leverage, and guaranteed stops
The basic terms of Forex trading_definitions of important concepts, including “pip,” “currency pair,” “contract” or “lot,” and more
Genesis and growth of the Forex market_how the Forex market emerged out of a changing global financial landscape and continues to change and adapt within that same volatile landscape
Fundamental factors that shape the Forex market_the U.S. government, inflation, the U.S. stock market, China and other emerging markets, oil, and breaking news
Fundamental tools for tracking Forex market changes_interest rates, Treasury International Capital Data, Consumer Price Index, S&P 500, U.S. dollar vs. Chinese yuan, balance of trade, crude oil futures, and news media
Technical analysis tools and indicators for gauging market sentiment_ such as moving averages, oscillating indicators such as, stochastics, Commodity Channel Index, Relative Strength Index and Fibonacci analysis
Filled with over 150 illustrations and figures, Profiting with Forex also shows investors how to combine their newly acquired knowledge of Forex fundamentals with proven trading techniques that can generate great rewards in the market.

WELCOME TO FOREX WORLD. WHERE YOU CAN MAKE YOUR OWN MONEY IN NO TIME

Forex Basics – Learn the background of the Foreign Exchange Market (Forex). How to Access the Forex. How to Analyze the Forex. How to Trade the Forex. Includes terminology, conventions and trading terms, like: Currency Names and Currency Pairs, Pricing, Pips, Liquidity, Leverage, Lots, Stop Losses, Trailing Stops... and more!
Technical Analysis – Learn about bars charts and candlesticks and patterns, used by the PROs to trade successfully. Learn about the various technical Indicators and which determine trends or oscillations, including: Moving Averages, Indicators & Oscillators: MACD, ROC, RSI, Stochastics... and more.
Money Management – Learn about Money Management, and the importance of a disciplined trading approach. Includes: Trading with sufficient capital, proper use of leverage, evaluating Risk/Reward, developing and following a Trading Plan, limiting downside risks with Stop Loss limits and protecting your profits with Trailing Stops.

Forex News Services

The following sites provide news coverage of events relevant to the forex markets:Bloomberg Currency NewsAbout Bloomberg:"Bloomberg's media services provide real-time and archived financial and market data, pricing, trading, news and communications tools in a single, integrated package to corporations, news organizations, financial and legal professionals and individuals around the world."DailyFXAbout DailyFX:DailyFX is a service of Forex Capital Markets (FXCM) providing 24-hour market news and analysis.Forex Trading News CenterAbout Forex Trading News Center:"The complete Forex portal offering live streaming forex rates, live forex charts, forex news, forex trading forecasts, technical analysis, currency converter, forex books and educational material."Forexnews.comAbout Forexnews.com:"Forexnews.com was created in January 1999 and is committed to enhancing public knowledge about the foreign exchange markets. The site offers the latest insights and analysis in currency markets, freely available to traders and researchers alike."FX Street Forex NewsAbout FX Street:Features real-time quotes, news, newsletters and interactive chats with forex experts from all over the world.Would you like to share your experiences with any of these forex news services, or suggest one we've missed? Please feel free to post your feedback in the comments below.

Forex Signal, Forex Signals Advice

Forex Signal, Forex Signals Advice There are lot's of Forex signals providers out there. New Forex traders might be thinking of looking for a reliable Forex signals provider. Is there any reliable Forex signals providers available?Personally, I will say do not pay for Forex signals. Think about it - if a Forex signals provider sells Forex signals for living, you can doubt their Forex trading skills? Or else if they are pretty good in Forex trading and making lot's of profit, I am wondering why do they still bother to sell Forex signals for money. Thus, what would be the value of such Forex signals providers? The answer is ZERO.There are Forex traders who have been relying on Forex signals arguing those Forex signals providers really help them making money in Forex trading. These Forex traders can even show their Forex trading logs as evidence. After some though, I came out with the assumption that assuming I am the owner of a Forex signals provider, in order for my business to be in black, obviously I need some satisfying customers......

Choose Your Online Forex Broker

Choose Your Online Forex Broker Online Forex brokers are known to be a required evil if you are going to trade in currency. There are also those people who are eligible to trade without outside assistance, but for the normal trader, enforcing to trade on the Online Forex market with no broker is like trying to chase a grizzly bear with a soup spoon. Your chances of achievement are actually very low, and there is a distinct option you would get hurt quite badly. Of course choosing the incorrect forex broker might return results same as to the sick fated bear hunt. That is why it is significant that you select a broker in the right way.First thing to be considered is to be sure that the broker you choose has the proper qualifications. When you look at the brokerage firms in the United States, immediately exclude those that are not registered as a Futures Commission Merchant (FCM) with the Commodity Futures Trading Commission (CFTC). This is again important as this designation means that you are confined against scam and any possible abusive forex trading practices. Covering your personal security before a forex trade has been made is a high-quality way to wade gradually into the forex currency market.
Once you have removed the ones who do not have the required qualifications, and now have a short list of potential, the internet comes into picture. Just don't go with the brokerage firm, which has the best profitable, or gets the most excellent "Law and Order" individuality to assist in the following advertising, research your choices. A superior idea is to send some effective emails to your customer service people. Estimate how long it takes them to get in touch to you. This is, after all, a customer examine ambitious profession.
Once you are pleased with a firm's experience and customer service practices, its time to get down to your self-assurance tacks. Online forex trading speed is forever an issue, so find out how fast it takes your own potential online forex broker to carry out an order. Also, you would desire to know how much slippage could be expected. This needs information, which could be discovered in a phone call, or any email to customer service. You would desire these answers not only for regular markets, but for fast moving ones as well.

Forecasting Forex Currency Exchange Rate Movements

Forecasting Forex Currency Exchange Rate Movements
Forex currency trading has turned out to be one of the most talked about online trading options. If you read the views of people about Forex currency trading, you would find that some claim it to be some incredible way of becoming rich overnight while others believe it to be a form of gambling.But the fact is that it is like any other trading and as such works on some fundamental principles. And knowledge to these fundamental principles is essential for Forex currency trading.FX for Forex is the abbreviated form of foreign exchange. And if you don't find it mentioned in the media, well I also don't know the reason because Forex currency trading is the biggest trading market in the world and is one of the best places for investors to earn good money.Forex trading could be understood as the sale and purchase of currencies of different countries. When you deal in stocks or commodities, you use money to purchase stocks or commodities. But in Forex currency trading, money is made or lost on the basis of difference in exchange rates between a pair of currencies.When you buy a stock, you are investing in a company but in Forex trading you are actually investing in the economy of the country whose currency you have purchased. Purchasing currency of a country at the cost of some other currency shows that you have faith on the overall economy of the first county in respect to the second.An example can make things quite clear. Suppose you have the US dollar and Euro. If you feel that (actually its research and not feeling) the dollar is going to rise in price and the euro is going to lose value, as per the current market trends, you would sell euro and purchase dollar. Thus, when the price of dollar rises, you would reap profits. That is how the Forex currency trading forecast works.But if Forex currency trading forecast is so easy, why do most of the experts claim that it is risky and one must be very cautious in investment. Well, because it is very difficult to forecast currency movement. It is not easy to predict the general direction of currencies, and since you always trade in a pair of currencies you need to study the overall economic potential of both the countries and then only can you come to any conclusion.There are no rules about sticking to a pair of currencies. You could choose any pair from all around the world. But if you are a novice in Forex currency trading, you would do well to trade in these seven prominent currencies-US Dollars, British Pound, Euro, Swiss Franc, Japanese Yen, Canadian Dollar, and Australian Dollar Until, and unless, you have a fair understanding of the market, it is advisable to trade in these seven currencies.

Is there a best time to trade forex market?

Is there a best time to trade forex market?
The answer to the question," Is there a best time to trade the forex?" depends on your objectives. If you are trading the forex based on earning a higher rate of interest then Wednesdays are the best day to trade the forex. You earn triple the interest on your currency trades.The Forex market,as you know, is a 24 hour market.Forex trading hours, trading time:New York opens 8:00 am to 5:00 pm EST Tokyo opens 7:00 pm to 4:00 am EST Sydney opens 5:00 pm to 2:00 am EST London opens 3:00 am to 12:00 noon ESTAs you can see there is an overlap in trading times.New York and London - 8:00 am - 12:00 noon EST Sydney / Tokyo - 7:00 pm - 2:00 am EST London /Tokyo - 3:00 am - 4:00am ESTAs trading pairs overlap, they become more active. If you are day trading the forex these would be the times of greatest volatility.Remember that the forex market is unpredictable. As we have just seen the stock market ( February- March 2007) can affect the volatility of the forex market.Have your money and trading rules in mind before entering into any trade. Trade a percentage of your account that you are comfortable with and that will not leave you with a margin call if the market does take a major dip.Have your exit strategies in mind before entering your trades as well. Don't be greedy. There are fortunes to be made in the Forex market but fortunes have also been lost here.The key to success in this or any trading market is to know what level of risk that you are comfortable with and to trade with your money rules in mind and not your ego. Trade to make a profit not to get high or pat yourself on the back for your own brilliance at the occasional slam dunk.