forex trading

Trading

2007-08-24T11:10:00.000-07:00

1. Purpose of trading

The purpose of trading on any market is to buy low and sell high. The foreign currency market FOREX is no exception. The goods traded on this market are rates of currencies of different countries. As any other goods the currencies have their prices.

To settle transactions between businesses located in different countries, governments, speculative transactions and so forth, banks around the world execute currency trades on FOREX market. Depending on various trade, economical and other parameters, interest rates, central bank policies, time of the day, preferences and anticipations of the market players, and many other causes, the rates, that is prices, of currencies stay in ceaseless motion.

Your task as a trader is to determine the trend of the rate and buy an appreciating currency or sell a depreciating one, and then take your profits through execution of a reverse transaction.

Our dealing center gives you the opportunity to use AFM (Akmos FOREX Master) software suite to obtain real time currency quotations from different banks and largest world exchanges participating in FOREX market. At the same time, the rate charts for every currency are displayed for you, and hottest economical News that may affect currency rates now or in the future directly or indirectly are fed to your screen. You may familiarize yourself with AFM by reading the user manuals.

And, at last, you will have a special trading account allowing you to buy and sell desired currencies. Despite of having US dollars in your account, you may start your trading from selling deutchemarks or japanese yens not concerning yourself with not having bought them in advance.

2. Some codes, numbers and definitions.

Each currency is assigned a three-letter code. For example, US dollar is coded - USD (United States Dollar), euro is coded EUR (EURo), Swiss frank is coded CHF (Confederation Helvetica Franc), Japanese yen is coded JPY (JaPanese Yen), British pound is coded GBP (Great British Pound). The currency codes are defined by ISO-4217 standard. Usually they are formed as a two-letter ISO-3166 country code and the first letter of currency name. There are a few exceptions most notable being the euro (EUR).

Currency rates are equal to ratios of currency units of different countries relative to each other. The rates are represented by 6-letter words composed of two three-letter currency codes. The first position is occupied, as a rule, by the code of a more expensive currency. The rates are expressed in units of the second currency per unit of the first one. For example, rates USDCHF (USD-CHF) show the number of Swiss franks in one US dollar, but rates GBPUSD (GBP-USD) show the number of US dollars having to be paid for one British pound. More detailed information on the codes of financial instruments may be found in this table.

3. How to read quotes.

The rates are usually expressed as five-digit numbers. For example, USDJPY = 121.44 means that 1 US dollar is valued at 121.44 Japanese yens (i.e. they are willing to pay you that many yens for one US dollar while you are buying or selling). At the same time, GBPUSD = 1.6262 means that 1 British pound is valued at 1.6262 US dollars. Generally, if the rate XXXYYY = Z, it means that one unit of XXX is worth Z units of YYY.

When the rate has changed, for example USDJPY = 121.44 to USDJPY = 121.45 or GBPUSD = 1.6262 to 1.6263, they say that the rate has moved 1 point. As it follows from the information above, yen in this example has DEPRECIATED by 1 point, but the pound has APPRECIATED, also by 1 point.

While watching the charts, you should keep in mind that only euro (EURUSD), British pound (GBPUSD) and Australian dollar (AUDUSD) charts reflect real movements of the rates of these currencies (that is, chart going up, means increasing price), as growth (that is, charts moving up) mean decreasing rates (prices) for the other currencies.

Sometimes quotes are given as a pair, for example 121.44/49. It is a BID/ASK pair: the first number is BID, then the two last figures of ASK. Knowing that ASK is always higher than BID and that the spread is under 100 points, the full ASK real prices can always be defined. In this example ASK = 121.49.

4. BID and ASK prices.

It is known, that every transaction is executed at a rather well defined and concrete price, while the table Quote Spread Sheet lists three prices for each currency, for example:

Each of the participants of FOREX market enters each trade as either a SELLER or a BUYER of a particular currency. In so doing, the seller offers the currency at a higher price, for example GBPUSD at 1.6325, while the buyer bids for it at a lower price, for example, GBPUSD at 1.6322. The seller's price is called ASK and the buyers price is called BID accordingly. This is why, if you anticipate GBPUSD to appreciate (your GBPUSD chart to go up), then you should decide to buy the pound when it is low to sell it high later. You can BUY only from a seller offering it at the price equal to ASK. Should you be selling the pound (this operation is called SELL), the buyer will bid at a price equal to BID for it (this holds true for all currencies). The obvious conclusion is that if you have OPENED a position (the operation is called OPEN), that is you have executed BUY GBPUSD, and want to CLOSE it immediately (the operation is called CLOSE), that is to sell the pounds you have just bought, then you could do it only at a loss, similar to what would happen at any currency exchange booth. Consequently, to make a profit you should let the rate move in the anticipated direction more than the difference between BID and ASK. The third number is called LAST, which is an average of last BID and ASK on Forex.

As described in the section 3 above, currencies with a direct quote only appreciate when the chart goes up. Currencies with inverse quote depreciate when the chart goes up. Considering an upward movement on the chart, BUY operation would be confusing if it's profitable for some currencies but not for the others. To clear the confusion, the BUY operation for currencies with inverse quote, like USDJPY, was altered. BUY for USDJPY and the like buy not the currency itself, like JPY but it buys the US dollars instead, selling the other currency. For example, BUY USDCHF at 1.4500 buys 100,000 US dollars for 145,000 swiss franks. Thus, the BUY operation is always profitable when the chart goes up, SELL is always profitable when the chart goes down.

OPEN BUY (up) is executed at the ASK, CLOSE - at the bid BID; OPEN SELL (down) – at the BID, CLOSE - at the ASK.

5. STOP and LIMIT orders.

Let us get aquainted with some useful trading tools allowing us to protect ourselves from unforeseen losses to certain degree and take the expected profits.

These are STOP and LIMIT. For a previously opened position an instruction may be entered at any moment (during the working days) to close it, if the rate reaches a preset level. For example, you have opened a position expecting the rate to go up (on the chart). To protect yourself from significant losses if the rate moves down, especially in such a situation when you don't have or are about to lose control of the market, you should enter a STOP, that is set a price at below its current value at which your position should be closed with no further instructions. Similarly, if you have opened a down position, then you should specify a price above its current value. In this case you should bear in mind that if the STOP is set too closely to the current rate value, then a random rate fluctuation may close a correctly open position at a loss, but if it is set too far, then the losses could become unreasonably high. LIMIT is a rate value that you set at which the position should be closed with a profit, that is the value of the LIMIT should always be above the current level, if you play long, and below it, if you play short.

Forex is an interbank market that was created in 1971 when international trade transitioned from fixed to floating exchange rates. Since then the rates of currencies relative to each other are determined by the most obvious means which is the exchange at a mutually agreed rate.

This market surpasses the others in its volume. For example, the daily turnover of world securities market is estimated at $300 billion, while Forex approaches 1 to 3 TRILLION US dollars in the same amount of time.

However, Forex is not a market in a traditional sense. It doesn't have a fixed location of the trading floor as, for example, futures market does. The trading is done over the telephone and at the computer terminals in hundreds of banks around the world simultaneously.

Futures and securities markets have one more significant feature distinguishing them from Forex, and at the same time restricting them. The trading is suspended at the end of each day and resumed only next morning. Thus, should certain significant developments occur in the USA, the opening of Russian market next morning could quite surprise you, if you're trading there.

Forex is open 24 hours a day, and the currency exchange operations are maintained throught working days of the week. Almost every time zone (London, New York, Tokyo, Hong Kong, Sydney) has dealers willing to quote currencies.

The primary causes of changes in currency rates are economical forces as well as political and psychological factors.

Basic parameters of economy such as inflation, interest rates, unemployment, and many others affect exchange rates constantly and dramatically. Government policy has drastic influence on the rates too. Competence of the government in maintaining the currency is conducive for its rate increase. Decreasing interest rates stimulates decreased demand for the currency and, thus, depresses its value in the exchange operations. A decision of the Central Bank of a country to buy or sell the currency may strengthen or undermine its rate significantly.

Expectations of change in the economic conditions may lead to sudden and drastic fluctuation of the currency rate. This is the key concept, because the foreign exchange market is often controlled by expectation of changes, rather than the changes themselves.

Activity of professional currency exchange managers, especially when caused by the interests of powerful financial consortia, is another important market force. In many cases, the managers may act independently and use the market as a unique instrument to achieve their goals of changing major rates. Most, if not all of them, could not care less about the adequacy of charts used for technical analysis. Though, as major levels of resistance and support are approached, the behavior of the market becomes more and more "technical", and the reactions of large number of traders often become similar and predictable. Such periods in the market may lead to dramatic rate fluctuations, because significant funds happen to be invested in similar positions.

n conclusion of this short presentation of Forex, we can define the main causes of popularity of this market among both professional and amateur investors.

Liquidity. This market can absorb such daily trading volumes as to surpass the capacity of any other market. High liquidity is a powerful attractive force for any investor, because it provides freedom to open or close a position of any size at a current market rate.
Continuous access. The 24-trading is an important attraction. The Forex participants do not have to wait to react to any event, as is usual with many other markets.
Flexible control. A position on Forex may be opened for just the period of time desired by the trader.
Cost. Forex traditionally does not have any commissions exept for natural market spread between bid and ask.
Unambiguous quotations. The majority of trades may be

2007-08-02T10:59:00.000-07:00

New signal service from fxwintrades

Matsys, the fxwintrades program trading system, uses an advanced, proprietary algorithm to compute dynamic pivot points.

We compute and publish these pivot points 1 – 3 times daily on the Matsys subscriber web pages, and until now we have also

shown them with a small delay on our page at www.fxstreet.com.

A small group of experienced forex traders have long been using the fxwintrades dynamic pivot points to establish entry points,

stops, and targets for their trades.

To make this opportunity available to a larger group of traders, we now plan a service where we twice daily will send emails

to subscribers giving specific recommandations as to entry points, stops, and targets based on the Matsys dynamic pivots.

Sign up for a free pilot

If you wish to participate in a free pilot, go to http://fxwintrades.com/mailman/listinfo/d-pilot_fxwintrades.com and register.

We advise you to use a demo account initially for the pilot trades until you become familiar with how it works. We also remind you

of the potentially high risks in forex trading – see the important notice and disclaimer on http://www.fxwintrades.com/1018.htm.

We will limit the number of participants in the free pilot to 100. First come – first serve.

How it works

Twice daily, in the morning between 8:00 and 8:30 am and in the evening between 8:00 and 8:30 pm Eastern time (New York)

we will send an email to the participants with trading signals for up to three currency pairs. The participants then choose to place

entry orders for these signals complete with entry price, stop, and target. The orders will run until filled or cancelled by another email;

or replaced by a new order. The trades will run until they reach the stop or target; or until they are closed by another email. Of course

the individual trader should excercise discretion based on his experience, judgement, and willingness to risk. We plan to run the

pilot for approximately 4 weeks. After that time the signals will be offered as a separate service in subscription for a charge.

2007-08-02T03:47:00.000-07:00

What is Forex

24-Hour Online Currency Trading (Forex Trading)
Fluctuations of global currencies create numerous investment opportunities, which you, an individual or institutional investor, can take advantage of given a proper set of skills and instruments. Learn more...

Learn to Trade

Professional Online Training
Get trained to trade! Forex Club presents unique online training materials.

Why Forex Club

Forex Club Advantage
Apart from the industry-standard free demo accounts and commission-free currency trading (forex brokers are compensated through spreads) Forex Club has a number of distinct advantages, such as one of the smallest initial deposits in the industry (just $10). Learn more...

Leverage in a base currency
Competitive spreads
No margin calls
No slippage under normal market conditions

Online Forex Trading Platform

Forex Club Financial Company is here to offer you advanced online Forex trading platform to let you learn, practice and trade on Forex market. Forex exchange market has become the world’s largest financial market with about 2 billion dollars traded daily. In earlier days Forex trading wasn’t not available for average individuals, but communication revolution has changed it. Today, with mini Forex trading platform it has become possible to take all the advantages of Forex market without risking large amounts of money. However, trading with small amounts may also be risky. Before you join Forex trading platform at Forex Club you should remember that trading on Forex market implies high level of risk and may not be suitable for all investors.

We offer your powerful online Forex trading platform which may help you to become a successful trader, but first of all you are to consider your experience, investment constrains, financial objectives and resources. There are many reasons why online Forex trading platform appeals to many traders. One of the most important are: availability of leverage, high 24-hour liquidity and low costs associated with executing trades. Our mini Forex trading platform provides you with the opportunity to engage in currency trading 24 hours a day and to react almost instantly to breaking news affecting the market. Currency trade is simultaneous buying of one currency and selling of another one and our Forex trading platform provides you with the opportunity to trade in 14 currency combinations.

Even though you are able to trade on Forex currency market online right away, Forex Club encourages you to learn from online Forex tutorials and video materials which help you understand the logic behind the Forex, recognize and capitalize on market trends, react to the major economic events impacting the global currencies, etc. Forex Club Financial Company is able to offer you demo Forex accounts or mini Forex trading platform which allow trading with smaller transactions sizes, allowing to trade on Forex market with minimum deposits as small as 10 dollars.

Choose online Forex trading platform offered by Forex Club and get access to resources, tools and products which may help you to engage Forex marketplace and, perhaps, become a successful Forex trader. Please make sure that you understand all the risks associated with Forex trading. You can read about these risks by clicking here.

FOREX Trading

2007-08-02T01:08:00.000-07:00

Day Trading World Currencies

The Foreign Exchange is the largest exchange market in the world. With the prospect of quick, hefty profits, and the explosion of internet technology and availability, trading on the FOREX has dramatically grown in popularity among investors of all types. But trading in this market isn’t easy. As with any other securities market, the successful trader must become knowledgeable and savvy with regard to the currency that’s being traded as well as the venue in which he or she is operating.

FOREX trading is a very specialized form of day trading. (Day traders invest by buying and selling securities, or opening and closing their market positions, on the same day.) Because of the high margins available in FOREX, investors can control large amounts of currency with relatively small outlays of actual cash. This leverage creates the potential for huge profits as well as huge losses. The would-be FOREX trader must remain aware that, just as with any other investment vehicle, financial loss is always a possibility.

The FOREX market provides a variety of unique and attractive investing opportunities. Study the articles of this section carefully, as well as other information and tools for the FOREX market. Safeguard yourself by becoming familiar with various risk management concepts. You'll need an account and trading platform with a reputable broker in order to begin trading. One such firm, known as Easy-Forex, offers full-service-, customizable-, and commission-free trading and support based on your experience and desired activity level. They give you full control over your account, even leverage and spread amounts.

Educate yourself thoroughly before taking advantage of this investment vehicle; knowledge and prudence will give you your best chance of success in this, or any other, exchange market.

Choosing a FOREX Broker

FOREX Fundamentals

Getting Started in the FOREX Market

Introduction to FOREX Trading

Introduction to FOREX Trading - Part 2

Operating in the FOREX Market