Is It Wise To Trade The Economic Data Releases?

If you trade the forex markets you will know that there are important market-moving economic data releases almost every day.

There will often be US-related data releases between 8.30 and 10.00 (US time) which can have a major effect on the dollar pairs and if you trade other currencies, then you also need to pay attention to specific news from that country. For example, you need to keep an eye out for UK-related news if trading one of the pound pairs.

When trading forex you always need to be aware of what news releases are scheduled for each day, but is it possible to actually make consistent profits trading off the back of the news itself?

Well in my opinion it is not possible to make sustainable profits trading these economic data releases simply because any subsequent movements after the announcements are often highly volatile and highly unpredictable.

They are basically open to interpretation, and any subsequent movements are based on traders' initial reactions to the news, which in itself can be unpredictable.

Sometimes you will find that straight after a news announcement, the market will move strongly in one direction or the other. This can either continue, or completely retrace and head in the opposite direction, making it impossible to trade.

This is because there is often a knee-jerk reaction to the news, and then a subsequent move a few minutes later once traders have fully digested the figures.

You will sometimes find that seemingly good news for the dollar, for example, will see a surprise sell-off and vice versa. It's all about trader's perception of the news and is basically too unpredictable to trade with any confidence so my advice would be to stay away from the economic data releases, because there are plenty of easier ways to profit from the forex markets.

This site (forexfactory) provide forex economic news all of time, i usually look at this site to monitored every forex economic news.


Source :
1. Forex Factory
2. Is It Wise To Trade The Economic Data Releases?

How To Earn Serious Money With Forex

The currency trading (Forex) market is the biggest and the fastest growing market on earth. Its daily turnover is more than 2.5 trillion dollars, which is 100 times greater than the NASDAQ daily turnover.

Markets are places to trade goods. The same goes with Forex. The Forex goods (or
merchandise) are the currencies of various countries. You buy Euro, paying with
US dollars, or you sell Japanese Yens for Canadian dollars. That's all.

How does one profit in Forex?

Very simple and obvious: buy cheap and sell for more! The profit is generated from the fluctuations (changes) in the currency exchange market.

The nice thing about the Forex market, is that regular daily fluctuations, say -
around 1%, are multiplied by 100! (in general Forex companies offer trading
ratios from 1:50 to 1:200). If, for example, the exchange rate of "your" pair of
currencies increased by 0.6% in the last 4 hours, your profit will be 60% on
your investment! Such can happen in one business day, or in a few hours, even
minutes.

You can implement your choice (the pair of currencies, the volume amount) under
any direction to which the market is moving, and yet make profit. It does not
matter whether the exchange rate is going up or down: you can always decide to
buy Euro and sell dollar, or vice versa - buy dollar and sell Euro. You don't
have to physically possess certain currencies in order to perform "buy" or
"sell" with them.

How do I trade Forex?

You select the pair of currencies with which you wish to make a Forex deal. You determine the volume (the amount of the deal). You deposit the "margin" (collateral needed to facilitate the deal. Usually - only a very small portion of the whole deal, say: 1% or 1:100).

Before you finally activate the deal, you can still "freeze" it for a few
seconds. That enables you to either change the terms, or accept it as is, or
altogether regret the whole idea. The "freeze" feature is a unique service.

When your Forex deal is running (you hold an "open position"), you can monitor
its status and check scenarios online, whenever you wish. You may change some
terms in the deal, or close it (and cash the profit, if any, or minimize the
loss, if any). Moreover, some companies let you determine a "take-profit" rate,
with which the deal will close automatically for you, when and if such rate
occurs in the market. Meaning: you do not have to stay near your computer when
you hold open positions.


Source : By Various Sources

How to Avoid Fail as A Forex Trader?

"Define first the level of risk you dare assume. Start with a small position, and then build it up if it works" – George Soros

"Give me a stock clerk with a goal and I’ll give you a man who will make history. Give me a man with no goals and I’ll give you a stock clerk" – J.C. Penny

"If you go to work on your goals, your goals will go to work on you. If you go to work on your plan, your plan will go to work on you. Whatever good things we build end up building us." – Jim Rohn


It is a sad fact that 90% of forex traders fail, and many very quickly give up. Why? When we went through a phase of losing trades we treated it as a temporary setback and went back to the drawing board. We analysed the reasons of our failure and we sought the guidance of Top forex traders, Mentors and Coaches to put us back on the path of success and profitability.

In our opinion the high rate of failure for a new forex trader can be related to the six major obstacles that a forex trader faces, which are summarised as follows :

1. Poor Skills
2. Lack of adequate capital
3. Setting unrealistic targets and goals
4. Lack of Patience
5. Lack of discipline
6. High risk aversion.
   

If we look at the list, it becomes apparent that the failure is as a result of forex trading without having in place a proper forex trading System and a forex trading Plan– One that includes mind training, quality Forex education and strategies and sound money management rules.

So what are the Characteristics of a Successful forex trader? All we have to do is to reframe the liabilities listed above.

1. Adequate forex trading knowledge and understanding. You should seek services of good quality mentors and a forex trading coach.
2. Adequate capitalisation – Don’t be fooled that you can earn thousands every week from a starting capital of $500.
3. Realistic Goals – don’t expect 100% profit each month, it simply is not possible.
4. Have patience – don’t trade if you don’t have to. You should wait for a set-up according to your forex trading plan and system.
5. Have Discipline to follow your rules.
6. Understanding and Managing Risk.
7. And lastly the most important is having a forex trading System and a forex trading Plan.
   

If you look at the advice from the world’s most successful people or forex traders today, you will notice that they follow the guidelines as identified above.

High Probability Forex Trading

High probability forex trading is all about taking positions where the odds of you making a profit are massively in your favour. So whether you are a short-term or long-term trader you always want to be looking for positions where you are more likely to win than lose.

This sounds obvious but most traders don't take probabilities into account when trading, which is a shame because it's quite easy to do, and could result in them being far more selective about their trading, and therefore more profitable.

All you need to do is to rate each potential trade out of 10 regarding the probability of the trade being a winning one, before you enter a position. So for example if you are thinking about entering a short position, and the technical indicators heavily back you up, for example MACD and TRIX have crossed down, RSI and Stochastics are in overbought territory, and EMA's have turned downwards, then you may rate your chances of winning as good and may give this set-up an 8, 9 or even 10 out of 10.

Therefore this trade would clearly be worth entering because the odds of you winning are high. If however, the technical indicators are conflicting with each other, for example, then you may only rate this trade as a 5 or 6 out of 10, which means it probably wouldn't be worth trading.

So next time you trade the forex markets, you may like to try giving each of your potential trades a rating out of 10, based on the probability of it being a winning one, and only trade those coming in at 8 or higher. This way your win ratio will probably be a lot higher and your profits should hopefully increase because you are not trading those borderline trades that you shouldn't have traded in the first place.


Source :
High Probability Forex Trading

Short-Term Forex Trading

Forex traders trade over a number of different time frames, but today I'm going to discuss short-term trading and look at whether or not you can really make consistent profits trading over such a short time frame.

It's a very difficult way to make consistent profits. This is because when you screen down to the 1 and 5-minute charts, for example, you're basically just looking at noise. Sure there will be times when the price lends itself beautifully to technical analysis, but there will also be times when it's just drifting, seemingly at random.

Also, if you're constantly scalping all day you are likely to get a lot of small wins, but also a lot of times when your stop loss is hit, often immediately if trading short term charts.

Over time this can be quite stressful and not a particularly enjoyable method of trading. Yes there are traders who trade this way and make very good profits, but I myself prefer to look at 30-minutes, 1-hour, 4-hour and daily charts to find high probability trades which can play out over a few days.

After all you can often make just as many pips from one or two good longer term trades a week, than lots of smaller positions, and it's unquestionably a lot less stressful. You don't even need to be at your computer all day either because you can just set your stop loss and limit orders and just walk away.

So overall my own opinion from my trading is that short-term trading is a difficult and stressful way of trading, but that's not to say that's it can't be profitable, it most definitely can, but it's just not for me.