Convergence and Divergence

The concept of convergence and divergence is very sensible as we look
for subtle indications of changes in the trend. Another way of ap-
proaching this issue is to ask, “Is this trend running out of steam?”
When the highs are getting higher, or lows are getting lower, we are en-
couraged to look for reasons to enter the market in that direction. But,
when the highs are not getting higher, then sometimes it is an indication
that a reversal is about to begin.
But, the Forex is so very dynamic that these convergence/divergence
rules become very complicated. For example, I was studying a website on
this topic where the examples that were used had three sets of oscillators
at the bottom of the chart. There were two separate Slow Stochastics and
oneMACD oscillator. Not only that, but there was a total of 16 lines in those
oscillators. How amI ever going to understand and learn how to trade using
16 lines?
Even if I learn how to use 16 lines, I will then need to learn the differ-
ences between “regular divergence” and “hidden divergence,” and the rules
for trading just exceeded my ability.
My approach to divergence is very simple: If the oscillator is moving
in the opposite direction of the chart candles or bars, then I have
divergence. Period. In Figure 3.1, I have drawn three arrows to indicate
the divergence where the 5-period and 20-period moving average lines are
following themarket and aremoving in one direction while theMACD lines
at the bottom of the chart are going in the opposite direction. If the trader
waits for indicators to be convergent, some bad decisions can be avoided
as the trend is followed in a precise manner.

Forex Tips For Beginners

Stepping on the stage of the currency for the first time may feel a little intimidating, but do not forget these forex trading tips and you will be soon a good trader.

Study/Self-Study - The very first step before entering currency trading.

Practice means perfect - Most of new traders lose their account at first in two or three months, so do yourself a favor and keep your trading education of the costs as low as possible. Practice with one or more different demo accounts. Be good at analyzing the actual trading before throwing your money. Then when you feel ready, begin to negotiate a very small amount of real money.

Patience - Not all Forex traders trade because they want to make money. Most of the traders trade because they want the action. Do not expect to make money in all trades. Forex markets do the unexpected and sometimes you lose more than you expected, but if you resolutely avoid these mistakes, you must make money.

Self-Discipline - It has been an experience to all traders in Forex trading that the greatest cause of losses in trading is the absence of self-discipline. You need self-discipline to follow your plan to trade, be patient, take the loss and benefits.

Mistakes That Forex Traders Make

1. Using Too Much Leverage
One of the biggest advantages of forex trading is the ability to use leverage or trading on margin. One of the most common mistakes that forex traders make is using too much leverage. Using too much leverage is when you have a small account balance, but make a big trade. If the market moves against your position by just a small amount, it can result in large losses. Commonly, the beginning forex trader will get emotional and nervous and close the trade for a sizable loss.


2. Over Trading

Over Trading occurs when traders try to look for trading opportunities 

that are not really there. It happens to new traders very often, 

because they just want to trade. The result is usually a poorly 

executed trade that results in an eventual loss. Over trading can also 

result in traders making too many trades at once and using too much 

margin.

3. Picking Tops and Bottoms

Many new traders attempt to try to pinpoint where a currency pair will 

turn around and start moving the opposite direction. This is something 

that is difficult even for professional traders.

The Bottom Line

My bottom line advice is that you need to take time learning forex. It's a very exciting and fast paced industry, but it requires some understanding of how the markets work, and a bit of understanding of your own thought process. If you take the time to slow down and actually learn forex and what it's about, you will be a more successful trader. Being patient is not always an easy task, but things that are worth doing right are not always easy.

A Trader's Tool

A mechanic has many tools. Each tools with its own usage and purpose. It is only down to intelligence and creativity that separates a good mechanic and a bad one.

Like a mechanic, a trader has many tools as well. Each indicator is a tool for the trader and a combination set of tools with rules is a trading system. A good trader has not 1 but many system. Each system has different purpose. It is down to knowledge and creativity that separates a good trader and a bad one apart from portfolio.

The best time frame to trade is the lower time frame but due to noise and spikes it is difficult to trade using lower timeframe. It is the reason why most trades fail in short time frame.

EurUsd has been ranging for the past few days and due to it, has hit my stop loss twice. Being a trend trader myself, I just cannot trade during these ranging period. So I stopped trading and try to make a new trading system using lower time frame to catch these ranging market.

It seems with a new set of tools (not new actually, had not used them for a while), I have manage to create an almost perfect trading system for all time frame but with the target of 15m chart. The only thing that this new system doesnt show is when not to trade which i made up with a new set of rules.

If any of you would like to try the new trading system please leave your email. I will try to get back to you ASAP.

Understanding Forex Trading

In the foreign exchange market, you buy or sell currencies. Placing a trade in the foreign exchange market is simple: the mechanics of a trade are very similar to those found in other markets (like the stock market), so if you have any experience in trading, you should be able to pick it up pretty quickly.
The object of forex trading is to exchange one currency for another in the expectation that the price will change so that the currency you bought will increase in value compared to the one you sold.

How to Read Forex Quote

Currencies are always quoted in pairs, such as EUR/USD or USD/CHF. The reason they are quoted in pairs is because in every foreign exchange transaction you are simultanesouly buying one currency and selling another. Here is an example of a foreign exchange rate of the British pound versus the U.S. dollar:
GBP/USD = 1.7500
The currency to the left of the slash ("/") is called the base currency(in this example, the British pound) and the one on the right is called the quote currency or counter currency (in this example, the U.S. dollar).
When buying, the exchange rate tells you how much you have to pay in units of the quote currency to buy one unit of the base currency. In the example above, you have to pay 1.7500 U.S. dollar to buy 1 British pound.
When selling, the exchange rate tells you how many units of the quote currency you get for selling one of the basis currency. In the example above, you will receive 1.7500 U.S. dollar when you sell 1 British pound.
The base currency is the “basis” for the buy or the sell. If you buy EUR/USD this simply means that you are buying the base currency and simultaneously selling the quote currency.
You would buy the pair if you belive the base currency will appreciate relative to the quote currency. You would sell the pair if you think the base currency will depreciate relative to the count currency.

Long/Short

First, you should determine whether you want to buy or sell.
If you want to buy (which actually means buy the base currency and sell the quote currency), you want the base currency to rise in value and then you would sell it back at a higher price. In trader's talk, this is called "going long" or taking a "long position". Just remember: long = buy.
If you want to sell (which actually means sell the base currency and buy the quote currency), you want the base currency to fall in value and then you would buy it back at a lower price. This is called "going short" or taking a "short position". Short = sell.

Bid/Ask Spread

All Forex quotes include a two-way price, the bid and ask. The bid is always lower than the ask price.
The bid is the price in which the dealer is willing to buy the base currency in exchange for the quote currency. This means the bid is the price in which you the trader will sell.
The ask is the price at which the dealer will sell the base currency in exchange for the quote currency. This means the ask is the price in which you the trader will buy.
The difference between the bid and the ask price is popularly know as the spread.
Let's take a look at an example taken from a trading software:

On this EUR/USD quote, the bid price is 1.2293 and the ask price is 1.2296. Look at how this broker makes it so easy for you to trade away your money. If you want to sell EUR, you click "Sell" and you will sell Euros at 1.2293. If you want to buy EUR, you click "Buy" and you will buy Euros at 1.2296.

In the following examples, I am going to use fundamental analysis to help us decide whether to buy or sell a specific currency pair. If you always fell asleep during your economics class or just flat out skipped economics class, don’t worry, we will cover fundamental analysis in a later lesson. For right now, try to pretend you know what’s going on.
EUR/USD
In this example euro is the base currency and thus the “basis” for the buy/sell.

If you believe that the US economy will continue to weaken, which is bad for the US dollar, you would execute a BUYEUR/USD order. By doing so you have bought euros in the expectation that they will rise versus the US dollar. If you believe that the US economy is strong and the euro will weaken against the US dollar you would execute a SELLEUR/USD order. By doing so you have sold euros in the expectation that they will fall versus the US dollar.

USD/JPY
In this example the US dollar is the base currency and thus the “basis” for the buy/sell.

If you think that the Japanese government is going to weaken the Yen in order to help its export industry, you would execute a BUY USD/JPY order. By doing so you have bought U.S dollars in the expectation that they will rise versus the Japanese yen. If you believe that Japanese investors are pulling money out of U.S. financial markets and coverting all their U.S. dollars back to Yen, and this will hurt the US dollar, you would execute aSELL USD/JPY order. By doing so you have sold U.S dollars in the expectation that they will depreciate against the Japanese yen.

GBP/USD
In this example the GBP is the base currency and thus the “basis” for the buy/sell.

If you think the British economy will continue to do better than the United States in terms of growth, you would execute aBUY GBP/USD order. By doing so you have bought pounds in the expectation that they will rise versus the US dollar. If you believe the British's economy is slowing while the United State's economy remains vibrant, you would execute a SELLGBP/USD order. By doing so you have sold pounds in the expectation that they will depreciate against the US dollar.

USD/CHF
In this example the USD is the base currency and thus the “basis” for the buy/sell.

If you think the Swiss franc is overvalued, you would execute aBUY USD/CHF order. By doing so you have bought US dollars in the expectation that they will appreciate versus the Swiss Franc. If you believe that due to instability in Iraq and in U.S. financial markets the dollar will continue to weaken, you would execute a SELL USD/CHF order. By doing so you have sold US dollars in the expectation that they will depreciate against the Swiss franc.

I don't have enough money to buy $10,000 EUR. Can I still trade?

You can with margin trading! Margin trading is simply the term used for trading with borrowed capital. This is how you're able to open $10,000 or $100,000 positions with $50 or $1,000. You can conduct relatively large transactions, very quickly and cheaply, with a small amount of initial capital.
Margin trading in the foreign exchange market is quantified in lots. We will be discussing "lots' more in-depth on our next lesson. For now, just think of the term "lot" as the minimun amount of currencies you have to buy. When you go to the grocery store and want to buy an egg, you can't just buy a single egg, they come in dozens or "lots" of 12. In Forex, it'd be foolish to buy or sell $1 EUR, they usually come in "lots" of $10,000 or $100,000 depending on the type of account you have.

For Example:
You believe that signals in the market are indicating that the British Pound will go up against the US Dollar. You open 1 lot ($100,000) for buying the Pound with a 1% margin at the price of 1.5000 and wait for the exchange rate to climb. This means you now control $100,000 worth of British Pound with $1,000. Your predictions come true and you decide to sell. You close the position at 1.5050. You earn 50 pips or about $500. (A pip is the smallest price movement available in a currency). So for an initial capital investment of $1,000, you have made 50% return. Return equals your $500 profit divided by your $1,000 you risked to trade.

Your Actions	GBP	USD	Your Money
You buy 100,000 pounds at the GBP/USD exchange rate of1.5000	+100,000	-150,000	$1,000
You blink for two seconds and the GBP/USD exchange rate rises to 1.5050 and you sell.	-100,000	+150,500**	$1,500
You have earned a profit of $500.	0	+500

When you decide to close a position, the deposit that you originally made is returned to you and a calculation of your profits or losses is done. This profit or loss is then credited to your account.
We will also be discussing margin more in-depth in the next lesson, but hopefully you're able to get a basic idea of how margin works.

Rollover

No, this is not the same as rollover minutes from your cell phone carrier. For positions open at 5pm EST, there is a daily rollover interest rate that a trader either pays or earns, depending on your established margin and position in the market. If you do not want to earn or pay interest on your positions, simply make sure it is closed at 5pm EST, the established end of the market day.
Since every currency trade involves borrowing one currency to buy another, interest rollover charges are an inherent part of FX trading. Interest is paid on the currency that is borrowed, and earned on the one that is purchased. If a client is buying a currency with a higher interest rate than the one he/she is borrowing, the net differential will be positive (i.e. USD/JPY) – and the client will earn funds as a result. Ask your broker about specific details regarding rollover.

Understanding Forex Rates and Trade

Forex rates simply refer to “foreign exchange rates”. These are used when one wishes to buy and sell different currencies on the foreign exchange market, so as to earn money. They can also be referred to as “currency exchange rates” because they are, obviously, the rate at which you can exchange one currency for another. They are mentioned in pairs. An example is EUR/USD which means the number of US dollars that are equivalent to one Euro.

How You Can Make Money From Forex Trade

People make money through the currency exchange through anticipation of the increase in value of a certain currency. Going back to the example of the US Dollar and Euro, you can buy Euros with your US dollars if you think that the Euro’s value, as compared to the US dollar, is bound to go up. If the exchange rate does go up, you can make a profit by selling your Euros. Although this entails a great amount of risk, this market is also very lucrative because it makes about 3.2 trillion US dollars daily, and the market operates 24 hours a day.

Advantages of the Forex Trade

In addition to what was previously stated, the Forex trade also has other benefits.

-You are allowed to trade on leverage.

-Compared to the stock market, the options are not overwhelming. All you have to do is select from a small number of currencies.

-It’s a very accessible market, even if you don’t have a lot of capital.

-All you have to pay for are the bid and ask spreads.

-It is upon your initiative to dictate how and when to trade.

Risks of the Forex Trade

Before you start trading forex rates, you have to realize that it involves high risk. Make sure you know your objectives and priorities before you enter it. Without a lot of experience, you might go through pitfalls such as losing your entire initial investment. You should only go through with it if you can afford to lose that much money. Ask for professional advice from a financial advisor if necessary.

If you intend to go into forex trade, here are a handful of tips:

1.Familiarize the lingo.

Familiarize yourself with Forex terms before you enter the trade. A lot of other traders may use technical jargon. You will end up feeling and looking stupid if you don’t understand what they are saying, and you might misunderstand and make wrong decisions based on ignorance.

2. Don’t go in unarmed.

You can’t just enter the trade without developing a strategy. Make one based on technical analysis, fundamental analysis, or other sensible tools and techniques.

3. Practice.

Before you hop in, familiarize yourself with the trading environment or go for free demos with various Forex companies. They will help you hone your analytic skills and prepare you for a real investment.

When you are finally ready to enter the world of forex rates, all there is left to do is to select a Forex company. Choose a broker wisely and ask all your questions at the beginning.

Most Visited Forex Trading WebSites

Forex on Top was updated today with the latest traffic rankings for what has now grown to 500 forex websites. Their is no doubt that Google is the best place to search for specific forex content but if you’re looking for websites that you can sink your teeth in, this is the place to find them. You can also browse the top 20 movers to find upcoming forex sites that might be worth exploring.


http://www.forexontop.com

Taking Profit In Forex

There are several approaches to taking profit. For example some traders will put on several lots on a trade then when the market reaches a predetermined level they will close a small portion of the trade. They leave on the remainder lots so they can continue to be in the market and gain profits.

Then there are the traders that put on a small number of lots, add to the trade when they get additional entry signals and when the market tells them that the current trend is coming to an end then they close all of the positions.

If a trader is making money we can’t say the way they take the profit is bad. As long as we are trying to make money while trading, why not maximize the profits on a trade. We have been thinking, when the market reaches the point that a trader wants to take some profit and the market is still moving why not put a stop loss at the predetermined exit point and let all of the lots continue to run. There are a couple of ways the trade could be ended with a maximum amount of profit and a minimum amount of loss.

The stop loss could be moved up as the market moves up to protect even larger amounts of profit. When the market gives a strong exit signal then close all of the lots on the trade. If the market retraces then continues in the original direction of the trade, at that point the trade can reenter the market and make profits all over again. We know there is no wrong or right way to make money. Pick the way that fits your emotional ability, and trading style.

In any event continue to make money and have fun trading.

Return Of The Robots

Part of the reason is that my day job does not allow me to use company Internet or computing resources for the purpose of earning revenue. This is a sensible restriction even if my use would only have been to let me view charts and enter trades.

Now I use the Internet at work purely to watch how my robot is doing. I don't enter trades, I can't access or change the robot's behavior during the day, so really, I'm watching buy and sell events for entertainment purposes. As long as it isn't chewing up bandwidth or interfering with my productivity that is alright.

The latest incarnation of live robot is a bi-directional trader. The theory is that at any point in time prices are going to move in some direction for a while and then in the other direction. This back and forth movement will continue endlessly.

Conceptually, break the bi-direction robot into two unidirectional robots.

With that done, admittedly, it is possible that one of my robots will run out of ability to trade as the price moves a long way in the wrong direction. However, my other robot will be earning a profit during this time. Additionally, I am certainly able to manually reallocate resources between these two robots if and when conditions support the reversal of a large movement.

With the volatility of last week this reasonably cautious robot did fairly well. However, this robot isn't suitable for professional trading as it is allowed to hang onto negative positions for a long period of time.

Perhaps the most important aspect of this robot is the sound it makes whenever it closes a profitable position. Hearing the ka-ching sound whenever there is price movement up or down is very rewarding... as it happens so often.

Forex Education

Get as much education about forex as you can.
I can't say that this hasn't been a valuable path. I've learned some good lessons along the way:

• it's important to let go of losses early so you have enough capital to sink your teeth into an opportunity that does work.
• No indicator or strategy has all the answers -- stop looking for the holy grail of trading
• The market can easily whipsaw you to tears if you aren't careful
• If you place close stops they will often be taken out before the market goes your way

Really, the list of anecdotal learning is endless and difficult to put into words. However, I recognize that this isn't enough to make me a successful trader, though from time to time I'm starting to taste success. It's finally time for me to bite the bullet and learn more about trading.

No, don't worry, I'm not going to buy some silly multi-thousand dollar Forex training course. That would be stupid. Forex trading is very related to trading in general and there is no shortage of information on either subject. To make a long story short I've purchased four books recently:

• Currency Trading for Dummies
• Swing Trading for Dummies
• The 10 Essentials of Forex Trading
• Technical Analysis for Dummies

All of these were available at a nearby bookstore -- so I didn't have to order something online and wait for delivery.

More importantly, let me list the credentials of the authors of the above books. Respectively, they are:

• Mark Gallant: Chairman and founder, GAIN Capital Group. Brian Dolan: Chief currency strategist, FOREX.com
• Omar Bassal, Head of Asset Management, NBK Capital
• Jared Marinez, FXCHIEF and founder of The Market Traders Institute, Inc.
• Barbara Rockefeller, International economist and trader

My advice? Never, ever, fail to look for the ideas of experts. Even if you don't agree with everything they say, which is appropriate, they should be able to increase your understanding and improve your own thinking.

What is Forex Trading?

Forex Trading Philosophy

I'm starting to believe that being successful trading Forex has more to do with your philosophy than anything else.

You cannot trade based on how much money you want to make. You cannot trade based on how much money you need to make. This means that you can't push money into the market, desperately searching for opportunity, risking a large portion of your net asset value in the process.

You must trade lightly.

When you trade lightly, you simply let the market give you the returns that it is willing to relinquish to you. Quite simply, it is not a process of taking.

If you can change your mindset it will give you a lot of peace compared to the level of stress that many generate. Dip your toes into the market, following your strategy, with a level of investment that simply cannot begin to raise your blood pressure.

A little bit of market wisdom, developed with experience, combined with an appropriate philosophy will generate profits. I know that this is difficult to consider or even believe in today's rational calculating world, but the only way to win is to not fight the market. It is way too big for you.

Stop trying to generate winning positions and simply let the market give them to you.




Like or comment if this information is useful...=)

Part Time Currency Trader

As I've written before it is quite easy to become a currency trader. The harder part is being a currency trader that doesn't lose money. You see, according to the scuttlebutt on the forums, about 90% of new traders end up losing their money to the market.

Are you thinking about trying your hand?

I'm not here to talk you out of it. I myself am a part time currency trader. By day I work at my office job and by night I fight crime with a mask and cape. Wait, no, that's not right. By night I trade online when family duties allow me to squander a chunk of time.

Trading part time has it's challenges. You will see endless market movements that you did not participate in. You will miss opportunities to open or close a position even though your ideas about what would happen next were proven right. In fact, a very large part of trading well involves being able to deal with the psychological aspects of trading, whether part time or not.

FOREX IS AN ART

When you say trading, people will say trading is an art. Look at all the books that has been published on the subject. They will say the art of trading forex.

In that sense, we must take forex as an art and not a science. I know, some people may not agree with me and all the post that is in this blog. I don't blame them coz I was actually in the same place as they were when I started trading. Trying to find the answer to forex using every logical explanation.

This is the answer that you have been looking for. I am going to give it to you straight away. Let see if your mind can accept it.

Forex is not a science. There is not a single mathematical equation that can explain it. Do not forecast, do not predict, do not anticipate. All you need to do to make profit is to follow the market. If the price is going up, you buy. If the price is going down, u sell. You may not win all the time but if you follow the market, in the end you will be in profit. Make profit and build up your capital up to a point where a few winning trades per month will bring huge profit.

Can you accept it? Can you mind admit it? Is your logical mind challenged? Do you feel helpless? Welcome to the real world..

Getting Started in FOREX Trading Strategies

Getting Started in FOREX Trading Strategies is intended as a sequel to Getting
Started in Currency Trading (GSICT), although it may certainly be used independently.
One comment readers often make after reading the latter is, “Great, now I
know the mechanics of FOREX. But what do I do next?”
If you are new to currency trading, I suggest you pick up a copy of Getting
Started in Currency Trading and read and study the material before starting
this volume.
Readers’ expectations vary enormously. Most thought “getting started”
truly meant getting started, but some assumed the book would carry them
through more advanced training. A few were disappointed not to find a $19.95
black-box system leading to great wealth without effort. There is no get-richquick
method in FOREX or any other market. Getting Started in FOREX Trading
Strategies (GSIFTS) is meant to give you an initial perspective on various
methods and a simple method on which to build.

Japanese Candlesticks and You

Once you become accustomed to using candlestick charts, you will find it
disconcerting to be limited to a standard bar chart. Without candlesticks,
you will feel that you are not seeing the complete picture — that something
is missing. Besides providing the quick and easy pattern recognition, candlesticks
have great visual appeal.

Additionally, the mention of investors, speculators, and traders will
be used throughout with no attempt to classify or define them.

Forex market and its players

Free forex signal

Eur/Usd
Eur/Usd is currently at 1.2862. From my calculation Eur/Usd has an upper range of 1.2880 - 1.2950. Possible trade is short Eur/Usd @ 1.2880 or better.

Gbp/Usd
Gbp/Usd is currently at 1.9102. As stated in my other blog, possible trade is short Gbp/Usd @ 1.9100 or better wih upper range of 1.9100 -1.9150

Aud/Usd
Possible trade short Aud/Usd @ 0.7710 or better. Already gone down now. Btw i shorted from 0.7751. Its a good trade so far.

Welcme to the world of Forex

Foreign Exchange (FOREX) is the arena where a nation's currency is exchanged for that of another. The foreign exchange market is the largest financial market in the world, with the equivalent of over $1.9 trillion changing hands daily; more than three times the aggregate amount of the US Equity and Treasury markets combined. Unlike other financial markets, the Forex market has no physical location and no central exchange. It operates through a global network of banks, corporations and individuals trading one currency for another. The lack of a physical exchange enables the Forex market to operate on a 24-hour basis, spanning from one zone to another in all the major financial centers.

Forex is becoming more and more popular due to its availability over the internet and current high speed internet. Some people have made a living out of forex trading. Its not easy but we all have to start somewhere. Here there will be infomation on forex trading, forex brokers, forex signal, forex chart, technical study and fundamental study of forex and lots more.

There will be other posters, other forex traders that will contribute article here. Come and learn to trade forex. See how easy it is actually to make money and to lose money as well.

In The Land Of Forex, Trend Is King

Those are the words i hold on to in forex. No matter what happen in technical or fundamental study. Always follow the trend. Trend is king. Follow the king and you will be rewarded handsomely.

Forex with peace of mind

Hi everyone,

I hope all of you are doing fine and have lots of pips to enjoy. Just got back from a vacation. 6 days there and I got bored and get back home. Leave my wife and kids there to do their shopping. It seems that I like it better at home than to stay at hotels. Maybe I'm getting old :)

Been a while since I have updated this blog. Been thinking of deleting or selling this blog to anyone who wants it. 

Met a friend while on vacation. It seems he is making 15k average per month without even knowing how to trade. Talk about forex with peace of mind. You guys wanna know how he did it? Let me tell you his story.

He wanted to learn from me how to trade but I am reluctant to teach him since this is not something I can teach. I can tell you how I did it but I cant guarantee you can do it the same way I did. Its not pure technical or skill. There are some form of mind control involve. I cant change your mind. You have to do it your self. Free your mind.

He kept asking me how to make money in forex. I gave him a way that is a bit risky but with care everyone can do it. I told him to find a trader that is looking for investors. Lots of new traders around with good skills but low capital. These traders are looking for a way to maximize their income, so they take in few accounts to manage. They trade their own account and at the same time execute the exact same trade on their managed accounts. They take profit from their own account and take commission on manage accounts. 

Turns out after 1 year my friend manage to get 15k average monthly income and he knows nothing bout trading. There are few rules to follow if you want to do the exact same way.

1. Study the trader records. At least 3 months maintain profit.
2. Open a trading account with your name tied to your banking account. (dont ever hand him your money)
3. Get the trader details just in case he decide to make a run for it.
4. Ready to accept trading losses. If its a trading loss, accept it and release him from his burden. Trading is already hard enuf. Now you know why I dont manage accounts.
5. Give him your trading account details and leave him alone. 
6. Take him out for dinner at the end of the months. Dont ask, let him tell you bout the trading.

Hope that is clear enuf. Those steps are minimal. Extra precaution is always welcome but dont put pressure on the trader. We dont want to send him to a mental hospital or something.

Good luck everyone and happy trading. Im not going to give any trade setup since its all based on situation. If its there, then i trade. Ifs its not there, then I just watch and play with my RC helicopter. My new hobby is RC helicopter btw, a very expensive hobby.... oouch.

What is Forex Trading - for Beginners

Forex Fundamental Analysis

Fundamental analysis is the process of market analysis which is done regarding only "real" events and macroeconomic data which is related to the traded currencies. Fundamental analysis is used not only in Forex but can be a part of any financial planning or forecasting. Concepts that are part of Forex fundamental analysis: overnight interest rates, central banks meetings and decisions, any macroeconomic news, global industrial, economical, political and weather news. Fundamental analysis is the most natural way of making Forex market forecasts. In theory, it alone should work perfectly, but in practice it is often used in pair with technical analysis. Recommended e-books on Forex fundamental analysis.

Understanding Pips In Forex Trading

To forex traders, everything revolves around pips. 

"I'm up 35 pips for the day."

"I made a 127 pip profit on my last trade."

That's great, but what's a pip?

Pip is short for "percentage in point" and you may sometimes hear people refer to pips as points. 

Put simply, a pip is the smallest unit of price for a currency. It's the last decimal point in exchange rates or currency pairs. 

For most currencies its 0.0001. So if you bought USD/CHF1.2475 and sold at 1.2489 you made 14 pips. 

One common exception is USD/JPY. In this currency pair there are only two decimal places so a pip is equal to 0.01.

The reason pips are so important is because they are the basis for calculating profit or loss in forex trading. 

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Each and every month there are a tremendous number of news releases for the Off Exchange Retail Foreign Currency Market (FOREX). Many of these events and announcements move the markets considerably. But how do you properly capitalize on these moves? Get it wrong and you could be wiped out. Get it right and you can be in a small group of trading elite, consistently pulling pips out of the market each and every week.

Analysis: With Ratings Agencies on the Nose, Europe Considers the Alternatives

Ratings agencies are again under attack, with European Union leaders objecting that Standard & Poor’s, Moody’s and Fitch Ratings are an “oligopoly” that issues self-fulfilling prophecies of doom, greatly aggravating the euro zone debt crisis.

The EU’s Internal Markets Commissioner suggested a partial gag to prevent them from grading debt issued by EU economies being rescued with official funds.

There is also an undertone of critical comment that they are based in the United States.

“We must first and foremost be more demanding on ratings of sovereign debts,” the EU’s internal markets commissioner Michel Barnier said on Monday.

German Finance Minister Wolfgang Schauble said that verification was needed “to check if there is abusive behavior” by the agencies. “We need to examine the possibilities of smashing the rating agency oligopoly,” he added.

At the Organization for Economic Cooperation and Development, chief economist Pier Carlo Padoan said that the agencies do not merely pass on information but “express judgements, speeding up trends already at work.” He said: “It’s like pushing someone who is on the edge of a cliff. It aggravates the crisis.”

Greece, Ireland and Portugal have all objected strongly to the fact and the timing of recent downgrades, and the head of the European Central Bank, Jean-Claude Trichet, said recently that the oligopoly, meaning dominant position of a handful of firms, was not an “optimal” arrangement.

There are calls from officials for the creation of a European rating agency.

Barnier blamed the agencies for “a hike in the cost of credit, weakened states” and a possible contagion of the euro zone crisis to other economies.

However, diplomatic sources say the agencies are being consulted at the EU level during tense talks on how to structure a second rescue for Greece, possibly involving a contribution from the private sector, in a way which would not trigger a default rating.

The agencies have warned that involvement of the private sector probably would trigger a default notation, and the ECB has warned that in that case it might cease financing Greek banks.

But some analysts were dismissive of Barnier’s suggestion.

“It’s a way of killing the messenger who brings bad tidings,” economist Nicolas Veron of the Bruegel think tank said.

Veron questioned whether this was the best option in Europe’s struggle to contain its sovereign debt crisis.

“What about institutional and company rating agencies in the countries concerned?” asked Cyril Regnat of France’s Natixis bank. The EU proposal, he added, risked “adding uncertainty, volatility and further speculation.”

Carol Sirou, head of Standard and Poor’s in Europe, said ratings agencies were not “hot heads” and that their work did not intend to “feed fears uselessly.

“It is not about throwing oil on fire, it’s about informing,” Sirou said.

Investors base key investment decisions on ratings, with notes going from a top grade such as AAA to D for default.

Vast numbers of investment funds, such as insurance and pension funds, may be prevented under their contracts with investors from holding sovereign debt if it falls below a given credit standing, and vice versa.