12 July 2007
Almost an hour into today’s special dollar trading session for tomorrow deals, the high and low on deals stood at 25.53 RUR/USD and 25.52 RUR/USD. Therefore, the spread on dollar deals has been narrow at RUR0.01. Meanwhile, commercial bank activity has been slack. As of 10:30 a.m., the trade volume was around USD77m.
Source: www.rbcnews.com
The second and final part of this report clearly and simply details more essential tips on how to avoid the pitfalls and start making more money in your forex trading.
1. Take it like a man – If you decide to ride a loss, you are simply displaying stupidity and cowardice. It takes guts to accept your loss and wait for tomorrow to try again. Sticking to a bad position ruins lots of traders – permanently. Try to remember that the market often behaves illogically, so don’t get commit to any one trade; it’s just a trade. One good trade will not make you a trading success; it’s ongoing regular performance over months and years that makes a good trader.
2. Focus – Fantasising about possible profits and then “spending” them before you have realised them is no good. Focus on your current position(s) and place reasonable stop losses at the time you do the trade. Then sit back and enjoy the ride – you have no real control from now on, the market will do what it wants to do.
3. Don’t trust demos – Demo trading often causes new traders to learn bad habits. These bad habits, which can be very dangerous in the long run, come about because you are playing with virtual money. Once you know how your broker’s system works, start trading small amounts and only take the risk you can afford to win or lose.
There are 2 basic types of analysis you can take when approaching the forex:
Fundamental analysis
Technical analysis
There has always been a constant debate as to which analysis is better, but to tell you the truth, you need to know a little bit of both. So letâs break each one down and then come back and put them together.
Fundamental Analysis
Fundamental analysis is a way of looking at the market through economic, social and political forces that affect supply and demand. In other words, you look at whose economy is doing well, and whose economy is on the other way round. The idea behind this type of analysis is that if a countryâs economy is doing well, their currency will also be doing well. This is because the better a countryâs economy, the more trust other countries have in that currency.
For example, the U.S. dollar has been gaining strength because the U.S. economy is gaining strength. As the economy gets better, interest rates get higher to control inflation and as a result, the value of the dollar continues to increase. In a nutshell, that is basically what fundamental analysis is.
Technical Analysis
Technical analysis is the study of price movement. In one word, technical analysis = charts. The idea is that a person can look at historical price movements, and, based on the price action, can determine at some level where the price will go. By looking at charts, you can identify trends and patterns which can help you find good trading opportunities.
The most IMPORTANT thing you will ever learn in technical analysis is the trend! Many people have a saying that goes, âThe trend is your friendâ?. The reason for this is that you are much more likely to make money when you can find a trend and trade in the same direction. Technical analysis can help you identify these trends in its earliest stages and therefore provide you with very profitable trading opportunities.
15. Ignoring the technicals- Understanding whether the market is over-extended long or short is a key indicator of price action. Spikes occur in the market when it is moving all one way.
16. Emotional Trading – Without that all-important strategy, you’re trades essentially are thoughts only and thoughts are emotions and a very poor foundation for trading. When most of us are upset and emotional, we don’t tend to make the wisest decisions. Don’t let your emotions sway you.
17. Confidence – Confidence comes from successful trading. If you lose money early in your trading career it’s very difficult to regain it; the trick is not to go off half-cocked; learn the business before you trade. Remember, knowledge is power.
This sums up the series of tips, coming up next on the Forex Tips will be on pitfalls of forex.
14. Tops and Bottoms – There are no real “bargains” in trading foreign exchange. Trade in the direction the price is going in and you’re results will be almost guaranteed to improve.
Ask (Offer) – price of the offer, the price you buy for.
Bank Rate – the percentage rate at which central bank of a country lends money to the country’s commercial banks.
Bid – price of the demand, the price you sell for.
Broker – the market participating body which serves as the middleman between retail traders and larger commercial institutions.
Cable – a Forex traders slang word GBP/USD currency pair.
CFD – a Contract for Difference – special trading instrument that allows financial speculation on stocks, commodities and other instruments without actually buying.
Commission – broker commissions for operation handling.
CPI – consumer price index the statistical measure of inflation based upon changes of prices of a specified set of goods.
EA (Expert Advisor) – an automated script which is used by the trading platform software to manage positions and orders automatically without (or with little) manual control.
ECN Broker – a type of Forex brokerage firm that provide its clients direct access to other Forex market participants. ECN brokers don’t discourage scalping, don’t trade against the client, don’t charge spread (low spread is defined by current market prices) but charge commissions for every order.
Fibonacci Retracements – the levels with a high probability of trend break or bounce, calculated as the 23.6%, 32.8%, 50% and 61.8% of the trend range.
Flat (Square) – neutral state when all your positions are closed.
Fundamental Analysis – the analysis based only on news, economic indicators and global events.
GTC (Good Till Cancelled) – order to buy or sell of a currency with a fixed price or worse. The order is alive (good) until execution or cancellation.
Hedging – maintaining a market position which secures the existing open positions in the opposite direction.
Jobber – a slang word for a trader which is aimed toward fast but small and short-term profit from an intra-day trading. Jobber rarely leaves open positions overnight.
Limit Order – order for a broker to buy the lot for fixed or lesser price or sell the lot for fixed or better price. Such price is called limit price.
Liquidity – the measure of markets which describes relationship between the trading volume and the price change.
Long – the position which is in a Buy direction. In Forex, the primary currency when bought is long and another is short.
Loss – the loss from closing long position at lower rate than opening or short position with higher rate than opening, or if the profit from a position closing was lower than broker commission on it.
Lot – definite amount of units or amount of money accepted for operations handling (usually it is a multiple of 100).
Margin – money, the investor needs to keep at broker account to execute trades. It supplies the possible losses which may occur in margin trading.
Margin Account – account which is used to hold investor’s deposited money for FOREX trading.
Margin Call – demand of a broker to deposit more margin money to the margin account when the amount in it falls below certain minimum.
Market Order – order to buy or sell a lot for a current market price.
Market Price – the current price for which the currency is traded for on the market.
Offer (Ask) – price of the offer, the price you buy for.
Open Position (Trade) – position on buying (long) or selling (short) for a currency pair.
Order - order for a broker to buy or sell the currency with a certain rate.
Pivot Point – the primary support/resistance point calculated basing on the previous trend’s High, Low and Close prices.
Pip (Point) – the last digit in the rate (e.g. for EUR/USD 1 point = 0.0001).
Profit (Gain) – positive amount of money gained for closing the position.
Principal Value – the initial amount of money of the invested.
Realized Profit/Loss – gain/loss for already closed positions.
Resistance – price level for which the intensive selling can lead to price increasing (up-trend)
Settled (Closed) Position – closed positions for which all needed transactions has been made.
Slippage - execution of order for a price different than expected (ordered), main reasons for slippage are – “fast” market, low liquidity and low broker’s ability to execute orders.
Spread – difference between ask and bid prices for a currency pair.
Stop-Limit Order – order to sell or buy a lot when the market reaches certain price. Usually is a combination of stop-order and limit-order.
Stop-Loss Order – order to sell or buy a lot for a certain price or worse. It is used to avoid extra losses when market moves in the opposite direction.
Support – price level for which intensive buying can lead to the price decreasing (down-trend).
Technical Analysis – the analysis based only on the technical market data (quotes) with the help of various technical indicators.
Trend – direction of market which has been established with influence of different factors.
Unrealized (Floating) Profit/Loss – a profit/loss for your non-closed positions.
Useable Margin – amount of money in the account that can be used for trading.
Used Margin – amount of money in the account already used to hold open positions open.
Volatility – a statistical measure of the number of price changes for a given currency pair in a given period of time.
Fears of an inflationary wage spiral eased on Wednesday after data showed that average earnings growth slowed by more than expected in the three months to April. The labour market report from the Office for National Statistics showed that average earnings including bonuses climbed by 4 per cent, the weakest growth since September. April’s number was lower than March’s downwardly revised figure of 4.4 per cent and was much softer than analysts expectations. Excluding bonuses, wages rose by 3.6 per cent in the quarter to April, unchanged on the previous month. The earnings news will be welcomed by the Bank of England and may, marginally, reduce the pressure for further interest rate rises to combat inflation.
Opening a new online trading account with a Forex broker can be done in three simple steps:
Selecting an account type
Registration
Activating your account
Before trading a dime of your hard earned money, you may want to think about opening demo account. Actually, open up two or three demos – why not? Itâs all FREE! Try out several different brokers to get a feel for the right one for you.
Account Types
When you’re ready to open a live account, you have the choice of opening a Forex trading account under your personal name or a business name. Also, you will have to decide whether or not you want to open a “standard” account or a “mini” account (or “micro” account if available). Inexperienced traders or traders with a small amount of capital to trade should always open a mini account. Only experienced traders with lots of money should open a standard account.
Some brokers have a âmanaged accountâ? option in their applications. If you want the broker to trade your account for you, pick this, but obviously youâre here to learn how to trade the Forex for yourself. Besides, opening a managed account typically requires a pretty big minimum deposit – $25,000 or higher – and the broker also takes a portion of the profits.
Also, make sure you open a Forex spot account and not a âforwardsâ? or âfuturesâ? account.
Registration
You will have to submit paperwork in order to open an account and the forms will vary from broker to broker. Some broker may allows you to do it online which no paperwork is necessary.
Account Activation
Once the broker has received all the necessary paperwork, you should receive an email with instructions on completing your account activation. After these steps have been completed, you will receive a final email with your username, password, and instructions on how to fund your account.
So all thatâs left is for you to login and start trading. Pretty easy huh?
BEAVERTON, Ore., June 25 /PRNewswire-FirstCall/ — Tektronix, Inc. (NYSE:TEK) announced today that its Board of Directors authorized an incremental $350 million to repurchase shares of common stock in the open market and in privately negotiated transactions under the company’s share repurchase program. Since this share repurchase program was initiated in January 2000, including today’s authorization, the board has authorized $1,600 million for share repurchase — approximately $909 million of which has been used as of May 26, 2007.
“The increase in the share authorization reflects…”
Last day of a Forex trading week brought some good results for EUR/USD currency pairs, moving it past 1.3450 level (but still not breaking the recent downtrend). The main reasons of such behavior of EUR/USD can be seen in slightly better than expected April industrial orders which in year-to-year period changed by +12.2% against +8.7% anticipated by experts. Also, Jean-Claude Trichet, President of ECB, spoke about Eurozone economics marking it mostly in very optimistic epithets, that could give Euro bulls some hope for the faster interest rates increase by ECB.
Selecting the online forex broker the right way. Firstly, make sure you have someone reliable and avoid signing up with those hit-and-run online site. Most online forex website offers free and limited online demo. It is good to start exploring before you sign up.
Other factors to be considered when choosing a broker including safety of funds, execution of trades, trading platform, account size, spread, commissions, margin and customer support.
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