Forex is an abbreviated name for "foreign exchange." The Forex market is a non-stop cash market where the currencies of nations are bought and sold, typically via brokers. For example, you buy Euros, paying with U.S. Dollars, or you sell Euros for Japanese Yen.

The value of your Forex investment increases or decreases because of changes in the currency exchange rate or Forex rate. These changes often result from economic and political factors, such as the price of oil or political unrest. To better understand how the exchange rate can affect the value of your Forex investment, this article shows you how to read a Forex quote.

Forex quotes are always expressed in pairs. In the following example, your "pair" of currencies are the U.S. Dollar (USD) and the Euro (EUR). The Forex quote, USD/EUR = 265.50, means that one U.S. dollar is equal to 265.50 Euros. The currency to the left of the / (USD in this case) is referred to as base currency and its value is always 1. The currency to the right of the / (EUR in this case) is referred to as the counter currency. In this example, one USD can buy 265.50 EUR, since it is the stronger of the two currencies.

Because the U.S. dollar is regarded as the central currency of the Forex market, it is always treated as the base currency in any Forex quote where it is one of the pairs. Incidentally, the U.S. Dollar is involved in nearly 90% of all Forex transactions.

In this example, your "pair" of currencies are the Japanese Yen (JPY) and the Euro (EUR). The Forex quote, JPY/EUR= 175.10, means that one Japanese Yen is equal to 175.10 Euros. The currency to the left of the / (JPY in this case) is referred to as base currency and its value is 1. The currency to the right of the / (EUR in this case) is referred to as the counter currency. In this example, one JPY can buy 175.10 EUR, since it is the stronger of the two currencies.

The goal of any Forex trading system is to profit from foreign currency movements. This requires adequate training in basic Forex principles, such as performing a Technical Analysis, using Forex charts and Stop/Loss tools, and keeping up-to-date with economic and political events. In a sense, Forex training never ends.

Anyone new to the foreign exchange market, through no fault of his own, will have a hard time understanding what it is all about. The foreign exchange market after all, is the world’s largest financial sector, involving an average of $1.8 trillion cash value traded per day.

The foreign exchange market is actually a vast market composed of many-tiered levels and many participants. Online traders contribute only 2% of the total cash value traded. This shows just how intricate the foreign exchange market really is.

What makes foreign exchange even more problematic is that it has developed a jargon all on its own such that its terms are no longer what they mean in common parlance. Although the task of understanding what the foreign exchange market is, is overwhelming, it is not impossible.

The Big Picture

A large company in South Africa ordered tons of marble from a small company from a province in Taiwan. In the old days, the company in South Africa would have a hard time paying for the marble as it not only would have to ship millions of South African money to Taiwan but it would also have to pay the small company in Taiwan in its own currency or else, the money will be useless.

With the foreign exchange market, paying for goods and services rendered by one country to another is no longer difficult. Through computers, there is no longer any need to ship money. All the South African company would have to do is to go to a bank and pay that bank in whatever currency and that bank will transfer the amount to a bank in Taiwan which will pay in whatever currency the small company in Taiwan wants. For profit, the bank will ask the South African company to buy the currency at a slightly higher price and pay the small Taiwan company using the current exchange rate.

The Small Picture

On the computer, a 21-year old jobless fresh graduate earned $10,000 in a few months. In April, he bought Euros to try out his luck in currency trading and to his surprise, the price of Euros soared by June and continued to soar until December. By December, he sold all his Euros, on a tip-off by an online friend that most of the European countries involved in the war in Iraq will be boycotted by those countries not in favor of the war. The tip-off was correct and in less than a month, the Euro’s value slipped lower than its original value when this jobless fresh graduate first bought them.

Many people have found, just like this jobless fresh graduate, how simple it is to earn through currency trading. Even a dollar capital can snowball into thousands of dollars if you know when to buy and when to sell. Etched in stone, all currency traders have but one motto: buy low and sell high. The jobless fresh graduate took a risk by buying Euros. He held on to the currency until it gained value and, as soon as he realized the value might lessen, he sold the currency for another.

Imagine having the firm that handles your Forex currency investments putting together an "all-star" team of traders to manage your account--unrestricted by geographic location and taking advantage of round-the-clock market opportunities.

Today's new trading technologies, or platforms, are making it more viable than ever to accomplish this--allocating an account's assets among multiple managers, with the purpose of diversifying portfolios, spreading risk and being able to quickly shift assets to the most successful traders, or those whose strategies are best suited to existing market conditions. And you have much to gain from it.

From a central location, your Forex firm can manage this elite group of traders--using advanced communication, trading, monitoring, and reporting platforms that allow immediate and continuous weighing of criteria to make the best possible trading decisions on your behalf.

Of course, an advanced system like this is only as good as the people who run it and the platforms they use. As always--whether you're an institutional investor or a serious individual investor--you should choose a firm with a verifiable track record of success and a reputation for meeting their clients' long-term goals.

Strive, for example, to entrust your assets to a Forex management company that carefully screens traders and selects those whose strategies are particularly suited to your investment objectives. Using a special platform, the primary manager of your account will be able to make multiple allocations, monitor individual performances, then shift, add, or remove traders as needed to produce the highest rates of return. It works in much the same way as a manager of a professional sports team strategically deploys, maneuvers and substitutes players in response to game situations to produce a winning result.

Another important consideration in choosing who manages your Forex account in today's fast-paced, high-tech exchange markets, is to ensure your broker adheres to high standards of integrity in preserving your capital by making safe and prudent investments. This means assigning manger-traders whose risk tolerance is aligned with yours, who trade with low drawdowns on your account, who maintain low margin-to-equity ratios that optimize usage of capital, and who endeavor to achieve a high reward to risk ratio. In essence, rather than displaying a retail trading mentality, you want your account management team to be committed to a low-cost, capital growth strategy over the long term.

The commissions you will pay also figure prominently in the profit equation. Since Forex brokers don't actually charge commissions per se, but are compensated by the difference between the buy and sell prices of currencies, or the spread, be sure your broker historically affords its clients the benefit of a narrow spread.

New technology platforms also give you, as the client, the ability to monitor your managed account's activity and performance and in real time, stay in close communication with your account manager and receive frequent detailed reports on your account's overall performance.

In summary, for investors seeking long-term portfolio growth in the Forex markets through managed accounts, the latest technology offers significant advances that afford you greater certitude and control over your investments, while allowing you to participate in trading opportunities that were once the sole domain of large financial institutions. Key to this is retaining a hard-working, reputable and highly competent Forex company that can fully utilize these new technological platforms to your best advantage.

North Finance has been on the market since 2001. North Finance addressed at Lymasol Cyprus; however, North Finance registered at Belize. Like two sides of coin, this forex broker has two different sides, bad and good side. North Finance's good side is competitive spread, easy new account opening, small minimal capital, easy deposit and withdrawal operation, interesting leverage, free Meta trader trading platform, good customer support, bank guarantee, swap free policy, IB business opportunity, trading varieties. North Finance is not good at news matter, no news tab in this broker's Meta trader, and busy server at news release.
In this forex broker, the spread is quite interesting; begin from 2 up to 10 pips in the news time and no commission. It is very easy to begin trading in North Finance, you can open account within 10 minutes from all over the world through the internet. The minimum capital to start forex trading in North Finance is $100; moreover, no minimal deposit and withdrawal at this forex broker, you also do not have to pay charge in deposit and withdrawal operation in North Finance. This forex broker accepts deposit via wire and electronic payment (e-gold). Credit leverage in this forex broker is very attractive, especially for low capital trader; begin from 1:1 up to 1:500.
This forex broker use Meta trader, instant execution and quotation system with eleven different languages. However, regrettably, North Finance's Meta trader does not support news that is one of important factor in forex trading. North Finance also support mobile trading; you can download Meta trader mobile freely at this forex broker. North Finance is very good in customer support; you can access customer support 24 hours 5 business days lively on North Finance live chat.
Furthermore, this forex broker's customer supports is very friendly and helpful. Not only good in customer support, this forex broker is also good in deposit and withdrawal operation time via e-gold. Deposit and withdrawal operation in this forex broker is very fast, almost finished in only five minutes. If you deposit $5000 or more at North Finance, you get free Visa Electron card that you can use to withdraw or shopping in any places in the world that have Visa Electron logo. You don't have to worry putting your money at this forex broker; your deposit above $100,000 is bank guarantees. However, you have to becareful when trading in North Finance at big news is released, this forex broker's server frequently very busy during big news time. North Finance has the good policy for Moslem trader; swap free for Moslem trader in this forex broker. This forex broker offers excellent opportunity to join a profitable business with them as IB (internet broker). North Finance has had IB forex brokers in more than twenty different countries, some of them are at Russia, China, Malaysia, South Africa, etc. In North Finance, you not only can trade forex, you also can trade CFD on futures, stocks, metals.
In conclusion, North Finance can be very considered as a good forex broker. This forex broker can be one of good choice when you decide to start forex trading.

There are many ways to fail in trading and investments.
Unforeseen market fluctuations, lack of experience, unpredictable
political changes (as well as a faulty internet connection) can all
reek havoc with a first time trader. But once equipped with proper
Forex training you can begin to minimize this risk, and turn
potential pitfalls into gains at every turn.

You¡¯ll soon see the benefits, too. Apart from the fact that the Forex
market never sleeps, you¡¯ll also be able to cash in on both rising
and falling markets. It sounds like a fantasy, but since currencies
trade in pairs, a good investor can make as much by selling a
particular currency as buying it. When you buy (go ¡®long¡¯) you are
in fact be able to sell (go ¡®short) the other half of the pair. One
value increases as the other goes down. It isn¡¯t quite as simple or
straightforward as it sounds, but that¡¯s where training in Forex
comes in. It will help you to spot the right currency to go long with
and the right one to go short, anticipatory of the changes and
entry/exit time.

Once fully trained, you¡¯ll also benefit from the famously low
transaction cost which Forex boasts for its investors. There is
generally no brokerage commission cost with this kind of set-up.
There is the added bonus that Forex is not directly correlated to
the stock market ¨C it deals purely with individual currencies and
how they contrast. The foreign currency market has little to do with
the stock market, and as long as the outlook is positive, a currency
change can always be converted into successful buying or selling
for the trader in question, regardless how the market appears to a
casual observer.

Forex training will introduce you to the foundation of this market -
its international conglomerate of traders and dealers. They consist
mainly of multination banks in touch directly with their dealers and
holders through the internet and telephone. As such, there are no
physical environments to act as the market floor, which usually tie
any trading post (such as the New York Stock Exchange and its
relationship with the equity markets) to the problems faced by
non-digital, real-time organisations. Forex succeeds precisely
because of its 24/7 status, and has come to be known as an OTC
(over-the-counter) market, much like NASDAQ. As an investor, you
will soon discover the tactical benefits of this approach.

As a Forex trader, you will also be struck by the fact that no one
can corner or alienate certain aspects of the foreign exchange
market. Because the business is so large, with so many
participating members, there is very little chance of an individual ¨C
even a group of companies ¨C holding sway over one portion of the
marketplace for any sustained period. This is truly a trader¡¯s
market, and once you begin your Forex training, you¡¯ll get used to
the countless benefits and wonder why you didn¡¯t take the plunge
before!

You’ve probably heard the hype about FOREX trading, and maybe even want to try FOREX trading for yourself. I’ll be honest there can be huge profits. Over a six week period I turned a $5000 investment into over a $30,000 profit, just using one strategy, commitment of traders. To put it simple, the big investors were all investing one way, the small investors were investing another way, and I decided to join the big investors. Well when the tide turned, I rode that tide to a nice little vacation in Maui. Yes, there is a good side to FOREX trading, otherwise known as currency trading. In fact there are many good sides. Some of these include the fact that you can find very low commission trading houses, you can get up to 200-to-1 leverage on your money, which means if you get the trade right, you can turn a couple hundred dollars into a couple thousand very quickly. Sounds pretty good doesn’t it. Well for the right personality type it is pretty good, but make no mistake it is work. You don’t just guess where you will throw your money or very quickly the power of leverage will work against you. You have to have a strategy and then follow it. You have to keep emotions at bay, which for me was not the easiest. Spock from Star Trek would have made the ideal FOREX trader, a ton of logic, no emotions, and no family.

To do it right you have to spend a fair amount of time watching how the currencies move against each other. You have to be able to take small losses, learn from them, and be confident in your next trade. Like most business, FOREX trading can be very similar to sports, and it is a very competitive game. Also just like the sporting world, when you begin to lose your confidence, look out. You may find yourself unwilling to pull the trigger on the next trade.

If you like staring at graphs all day, no real communication with others and money is a major motivator, FOREX trading could be for you. If you want money and fun, there are easier ways, which I have found, and that is why I no longer trade actively. If you would like to learn more about FOREX or the new ways I have found to make a decent living while balancing life please contact me through one of my websites listed in my writers bio box.

The foreign exchange market never stands still and, while it may move slowly at times, it is always on the move. In many ways this is one of the great benefits of Forex trading as it is this movement which provides the opportunity to profit from buying and selling global currencies, but it can also make it difficult to decide when to get into a trade, get out of a trade or simply stay out of the market altogether.

Perhaps the biggest problem with a market which is constantly presenting the trader with the opportunity to make a profit is that it plays on our natural sense of greed and this is a very real problem if you are not aware of the danger you face.

We all love to make a profit, but how much profit is acceptable? If you're in a trade and looking at a profit of $800 should you close out your position and take that profit or hang on in there for $1,000? You trade to make money and the more money the better so, when the market is moving in your favor it's only natural to want to ride the wave all the way to the beach. The problem however lies in knowing when you've hit the beach and not waiting until the undertow starts to drag you back out to sea again. Once you get caught up in the undertow it can prove to be very strong and drag you out again very quickly.

Many people enter Forex trading with a picture in their mind of just what they're going to do with all the money they make and that's no bad thing. It's extremely important to have a goal, and a plan to reach that goal, and to plant a visual picture in your mind as something concrete to aim for. However, the other side of this coin is that you may well be tempted to try to reach that goal faster than you had originally planned or to create a bigger and better goal as you go along, allowing your natural tendency towards greed creep in and begin to take control of your trading.

Another problem here is a simple failure to recognize that money does not drive the market.

Think about it for a moment. Whether you have $5,000 or $500,000 in your trading account is not going to make any difference at all to the way in which the market moves. Similarly, whether you have a $700 profit or a $700 loss in an open trading position isn't going to make the slightest difference as far as the market rising or falling is concerned.

The fact that you've done well in a trade and have made a profit of $700 doesn't mean that this is going to turn into an $800 or $900 profit if you wait a while longer. However, it's perfectly natural to find yourself caught up in your 'winning streak' and to convince yourself that there is more to come.

It's also perfectly normal to find that, having lost $700 in an open trade, your natural fear of losing is going to convince you that things will turn around if you just keep your nerve and hold on a little bit longer.

Setting yourself a goal and making a plan to reach that goal is essential, but your trading decisions need to be based not on your goal but on the market. Money should have nothing to do with whether you enter or exit a trade, or stay out of the market, and such decisions should be based solely on what your analysis and the numbers tell you.

I spent 10 years as a forex broker and traded thousands of clients, here I will give you a broker’s view of trading clients.

I will reveal who won, who lost, how we made money and how we treated them.

I joined as a rather green salesman and had no idea about the reality of forex and futures trading.

I was excited about joining an industry where millions were made and millions were lost by clients – It was very exciting!

The company

I was rather shocked at the reality which was:

Clients didn’t appear to win very often and the company based its balance sheet on commission to equity.

The view was that about 95% of clients would lose and they would do it all on their own, with no help from us.

The clients we liked (from a financial perspective) were the ones who made commission for the company and top of the list were:

Day traders:

They lasted for short periods, never won and made loads of money for the company.

If they believed it worked, let them get on with it and we would take the commission.

Shoot from the hip traders

The action men.

They loved the buzz, in and out all the time, trading the news and advice from gurus and with no discipline.

Again, they wiped themselves out and made us plenty of money.

The company did not dislike its clients.

We treated all clients well and did what a good broker should:

Help them with queries and made sure they got fast accurate executions.

We just let them do as they wanted and in most cases they lost – that’s simply the reality of trading.

The clients

We had clients from all walks of life, from retired people, to highly educated mathematicians and the few that did win surprised me.

The ones I personally hated were the ones I will refer to as “educated fools”

Cocky as anything and believed they had a divine right to win, because they were clever.

They would ignore my warnings, that they would not win with systems that were too complicated and tell me to mind my own business.

If I am honest, when they learned the reality of a wipe out, I felt a little inclination to say “told you so”, but never did.

Perhaps my favorite client was a retired lady, 81 years of age, who lived on a sheep farm in Australia.

A lovely lady and she taught me a few things, that I remember to this day.

She devised a system and showed it to me.

It was a simple buy and sell strategy and relied on holding big trends for months on end and you could learn it in a few hours.

Personally I thought it was to simple to work, but she built a $5,000 account to $39,000 in three months and had passed $100,000 in under a year.

She drew her charts by hand ( this was the late eighties) and didn’t have a TV and never read the papers.

Each day she would check her prices draw her charts and make her trades if she needed to.

A polite, humble trader, who was loved in the office by all.

We all had respect for the way she was our most profitable trader, even above some quite well known money managers.

We had many other clients.

Most lost and some won ( very few), but the ones who did win were humble, had simple systems, traded only when their systems told them to, had iron discipline and believed they were right.

This is just my experience.

I did trade a lot of people.

They from all walks of life and I learned very few won, but the ones who did, kept it simple, the ones who didn’t, had big ego’s, or liked excitement and traded with their emotions lost.

Enclosed are 10 mistakes novice traders make and they help over 90% of novice traders lose all their money. Make any of them in forex trading and odds are you will lose to.

Here are 10 mistakes you must avoid to win in online forex trading:

1. Day Trade

Simply the best way to lose in Forex trading.

The logic doesn’t work.

This should be obvious to a child, let alone grown adults!

Yet, more novice traders than ever try this dumb way of trading.

We have written numerous articles on this, if you still want to day trade read them.

2. Consult a guru

There are some people who sell advice that is good, but 90% of it is not worth the money.

If you do buy advice make sure you understand the logic and can follow it with discipline.

There are very few gurus that can help you and the best way is to do it on your own.

Success comes from within.

3. Get a broker assisted account

If brokers were good at trading they wouldn’t be brokers, they would be making money for themselves.

Sure, they can give you convincing stories, but stories don’t make money.

Getting market direction right does and the odds of your broker doing this are slim.

4. I can trade a Demo account so now I can make money

So you can make money paper trading with no money and place orders?

Big deal.

Fact is, paper trading is easy there is no pressure, as there is no money on the line.

Trading is an emotional ride and when money comes into the equation paper trader’s crumble as easily as traders who have not used a demo account.

5. Trade to frequently

Many traders think if their not in the market they will miss a move.

They trade for the sake of it and don’t have the odds on their side.

Only trade high odds trades, they cannot be hurried.

Be patient.

6. Mix fundamentals and technical inputs

A great way to lose.

You are either one or the other you cannot combine the two.

7. Chase your tail

Many traders constantly chop and change systems.

They have a perfectly good system they could have stayed with but get bored and swap and then they do the same with the next system.

Get a system and stick with it.

8. Over leverage

They over leverage on trades and get wiped out.

To win at online forex trading you need to play great defense, as well as great offense.

Protect what you have above all else.

All trades are equal, don’t fall in love with a trade.

In fact, the ones that look best and are the most comfortable to trade, often turn out to be losers.

9. Avoiding risk and creating it

Traders are so obsessed with avoiding risk they create it, by having stops to close and trailing them to quickly.

By trying to restrict risk they create it, by guaranteeing they will be stopped out and never riding a big profitable trade.

Forex trading is all about taking risk – calculated risks, when the odds are in your favor and making sure you don’t get stopped out by normal market volatility.

Learn about volatility and standard deviation, if you want to know why this is so important.

10. Try and have to many inputs

Many traders look for the perfect system and the more complicated it is the more likely it is to succeed.

After all 10 indicators are better than 2.

Not so, in fact the more inputs you have the less likely the system is to succeed.

There are more elements of the system to break it.

In forex trading simple systems beat more complicated ones and most of the world’s top traders only use very few inputs.

Don’t try and be clever and complicated, or you will lose.

Final words

Above you have 10 common errors forex traders make.

If you make any of them your chances of losing will be increased dramatically.

One of the most inspiring stories I ever read, was how legendary trader Richard Dennis taught 14 people who had never traded before, to trade successfully in just two weeks.

The result?

They traded and went on to make millions and become some of the most famous traders of all time.

So how was it done and can you do the same? Let’s find out.

Richard Dennis taught them three major points:

1. A simple method they could have confidence in.

2. Money management.

3. Applying the method with discipline.

His advice was very specific with no filler.

So, let’s look at what you need to learn.

1. Method

You need a method you have confidence in and it needs to be simple.

There is no correlation between how complicated a method is and how much money it makes.

In fact, the reverse is true.

A complicated method has more components to break and is less robust in the face of brutal market conditions.

Look up “technical analysis” on the net and learn specifically how and why it works and also the theory of “trading breakouts”

You should be using a long term trend following methodology looking for the big trends that produce the big profits and breakout trading is ideal for this.

If you want to win at online forex trading, you need to know about breakouts.

Base your methodology on it – It’s simple and it works.

Now you need to time entries.

Look at some indicators that are based on momentum and look up “stochastics” this is simply the best momentum indicator you can use.

2. Money Management

If you start with a “breakout method” and base your trading method on it, then stop placement is obvious.

If you only trade significant breaks your odds of success will be high.

3. Discipline

Is perhaps the hardest part of trading online forex.

You need to apply your method with rigid discipline otherwise you have no method at all.

Discipline is all about experience and even seasoned traders find it hard to keep executing a method when a string of losses occur.

However, you are part of the way there to having discipline, if you have devised your own method.

You know its logic and should be able to stay with it as you will have confidence in it to work.

All the material you need to get up and running is free and on the internet, but it’s worth reading a few books.

These are my favorites and will they inspire you.

1. Market Wizards and The New Market Wizards ( edit )

By Jack Shwager.

These are interviews with some of the top traders of all time including:

Richard Dennis and the turtles and many more – Packed with insight and very inspiring.

2. Trader Vic

By Victor Sperandeo.

A true trading legend, who shares with us his thoughts on trading, money management and trading psychology, a fantastic all round book.

By all means read a few more, but these three are my favorites from over 500 I have read.

Trading is Simple, yet people try and complicate it.

They think the more effort they put in the more they will get out – This is totally false.

Work smart not hard!

If you want to make money you need to work smart not hard and if you want a perfect example of this look at the turtles!

In just two weeks they all became great traders.

Maybe, you wont make as much money as them, but if you learn and do the above, you will have the basic platform to make big profits in online forex trading.

Finally, you will have done it all on your own and will have given yourself success, how satisfying is that?

If you have been following our articles you will know we love the stochastic indicator it’s simply the best timing indicator you can use and here’s the proof:

We showed you 5 trades and got 4 profits and 1 break even and have 3 open trades all in profit- So why is momentum so important let’s find out.

Trade with The Trend

One of the biggest mistakes you can make in trading is to trade against price momentum.

A Fatal Mistake

Many traders make the fatal mistake of simply buying near support and selling near resistance, even when price momentum is moving strongly to these levels.

However if you trade and “hope” these levels hold then you will be trading against momentum and increase your chances of losing.

Traders do this because they want to sell market tops and buy market bottoms.

This is not a good way to trade!

You are better off waiting for momentum to turn before trading this means that prices have tested the level and then you can get in with the odds on your side.

The Ultimate Timing Indicator For Swing Trades

The best momentum indicator in our view is the stochastic (explained more filly in our other articles) as it measures short term price momentum.

You can see it on many free sites such as futuresource.com.

It’s a visual indicator and you don’t actually need to know the equation behind it to use it – Same as you don’t need to know how an internal combustion engine works to drive a car.

If you look at the Dollar Yen trade we gave a few days ago, you will see both stochastic lines were pointing down as prices zeroed in on support.

To time an entry long and indicate support will hold you look for the following:

A cross of both lines to the upside.

This is referred to as bullish divergence, shows short term price momentum is reversing and the bulls are taking control above support.

The exact opposite applies when you are swing trading into resistance.

Don’t Predict Get Confirmation

By waiting for the crossover, you don’t buy the bottom, but you get in when the odds of an up move are higher and this will mean more profitable trading.

All three trades we picked as live examples are in profit and you can spot similar trade set ups.

Watch stochastic momentum above support or below resistance and watch for bearish or bullish divergence crossovers to time your trades.

If you do, you will get more high odds trades and take the hope out of your trading:

You will trade on the facts and this will increase your odds of success.

Try this method in your swing trading and see how effective it can be.

It is a little known fact that the foreign exchange market, trading upwards of $2 trillion daily, is the largest and most liquid in the world. Until recently, small, risk oriented investors were unable to tap into this market because of the size of transactions and stiff financial requirements for entry. That has all changed. Entry requires only a minimal amount of capital, opening the Forex to almost all investors.

Can you, as a smaller investor, make some quick money trading on the Forex? The answer is yes. But, wait a just a minute, not quite so fast!

One of the perceptions among smaller speculators is that the Forex offers an easy way to make money quickly. While that can be true, there are a number of precautions that the neophyte should take before committing to any sizable trades. Forex education is absolutely vital before you jump in feet first.

Even before beginning to develop knowledge of how to trade and what trading strategies to adopt, understanding a few basics is in order,. Unlike other markets (i.e. stock exchanges, etc.) the currency exchange market does not have a central, physical location for conducting trades. Trading is carried on directly between banks, foreign currency dealers and foreign investors using computer terminals, telephones and broker desks. Thus, foreign exchange trading is over the counter.

Indeed, most currency exchange trading takes place online. This accounts for the recent burgeoning growth of the Forex. Trading may be conducted 24 hours a day from anywhere worldwide. Anyone connected to the internet from their home or office may be a trader, and there has been a rush of investors to this market in search of quick money.

Fortunately, speculators entering this market can take advantage of the many free tutorials available on the internet. Beyond anything else, if you are a beginner, it absolutely critical that you refrain from serious trading until you have gained sufficient confidence by paper trading in a demo account. Making that first trade can be an intimidating proposition if you are a first-timer. Forex brokerages have recognized this, and most have created methods where the novice trader can gain some hands-on experience without having to risk real money. With a demo account, a new investor can practice making trades for a period of time before seriously dipping into the hectic arena of currency trading.

Another cautious way of approaching the Forex market is to avail your self of a mini-account offered by many brokers. Here you can get your feet wet with a smaller initial investment than with a full blown trading account.

One of the characteristics of currency trading is that profits can be realized in a matter of minutes, even seconds, unlike what you may have seen investing in stocks. This is attributable to rapid and random variations taking place in the foreign exchange market. So, it is in this fevered environment that you can make quick money.

Although nothing in the investment world is really easy, there are a considerable number of online signal services which can make earning profits in the Forex easier than you might think. A signal service will monitor the market for you and send any new developments of significance to your computer, cell phone or pager. This way, you can keep abreast of market changes as they occur in real time, offering you greater likelihood of making sound trading decisions.

A word of caution is in order. Numerous scams are showing up where companies offer to do your trading for you. Avoid these like the plague. Craft your own Forex strategies with an expert and trade solely on your own or through a licensed broker. No one should ever do your trading but you.

Yes, you can make money quickly in the Forex market. Trading goes on 24 hours a day in this highly accessible, highly liquid market. Opportunity always lies at your fingertips. Take the cautious approach outlined here. Probe the accumulated knowledge base in much greater depth using online broker services, free tutorials and demo accounts which will provide you the foundation you need to make quick money trading on the Forex.

If domestic stock market fails to interest you any more, consider trying your trading skills in Forex. The forex or Foreign exchange is the ideal place for those traders who look for a little more adventure in their moneymaking games. The Forex trading involves the trading in all sorts of world’s leading currencies. The Forex trading refers to a simultaneous buying and selling of different currencies. The forex trading always involves the combination of two or more currency; that is you have to trade one currency in comparison to the other. The currency combination used in this international currency trade is known by the term, ‘cross’. As for example, the Euro/US Dollar, or the GB Pound/Japanese Yen and you can deal in literally limitless combinations. However, the most commonly traded currencies belong to the group of “majors” like EURUSD, USDJPY, USDCHF and GBPUSD.

Global Forex trading provides the investors and financial institutions a new financial playground in the backdrop of a volatile currency environment in this age of globalization and free market. With the base camps in the topnotch cities like New York, Sydney, Tokyo, London, and Frankfurt, the Forex market is a kind of OTC or over the counter market where trading takes place directly between the two counterparts. Unlike the national stock markets, Forex is not under the regulation of a central exchange; it is operated on the “interbank” market. You can trade in this 24-hour market over telephone, or over the global electronic networks. These are some of the reasons behind this enormous growth.

At the core level, online foreign exchange trading can be defined as the exchanging of one currency for another. It is a kind of 'spread ' trade where buying of one currency must be followed by the sale of the other. You have to buy one currency and sell another simultaneously. Online Forex trading system is described as an ergonomic process. A seasoned trader has great intuitive abilities. You can perform all the online trading functions from a single screen including placing a trade, leaving an order, position and order management, and margin analysis. The foreign exchange market traditionally belonged to such big shots as banks, brokers and big export Houses. But picture has drastically changed with the invasion of the market by the internet. Nowadays, more and more common people are participating in the trading in Forex market. Are you confident about your trading skills? Then you can also join the bandwagon of the big international investors. You will get all the necessary resources and information right in the Internet. Being informed is important as side by side of great money making potentials, the functioning of foreign exchange market is characterized by volatility, unpredictability and risk factors.

Trading in the foreign currency proves to be exciting and in most of the cases profitable. Those who become enormously successful in this field have the unique ability of locating the risk factors. With the all-invasive growth of Internet the monopoly of big investors in the forex market has ended. But before stepping in this volatile world of foreign currency trading a small time investor should always keep in mind the implications and pitfalls that this market is entailed with.

Here we are going to give you two indicators to use with simple support or resistance to isolate contrary trades that offer great returns and low risk.

We are going to apply them to a live example shaping up right now.

The indicators we are going to use are:

RSI – To spot the turn.

And

Stochastics to time entry.

Both these are explained in other articles; here we are going to show you the set up.

Pull up a chart service such as Futuresource.com and go to the Dollar v Yen chart.

If you look at the dollar yen you will see the price falling toward support nearby support is the recent double bottom then the December low.

Now look at the RSI each time it has fallen to oversold levels (the bottom black line) prices have bounced near these levels and risen.

Watch the RSI carefully as we approach oversold levels which we are now.

Now its time to look for support to hold.

To do this use the best timing indicator the stochastic.

At present both lines of the stochastic are pointing down showing weak price momentum.

Wait

Watch for the lines to cross to the upside with bullish divergence indicating that price momentum is turning to the upside above support.

This means the bulls should take charge and only a break below Decembers low on a close basis puts the yen bulls in charge.

Right or wrong, this trade will give low risk and high odds of bounce in the dollar.

If the trade were stopped out the risk would be low, but the bounce if this level holds should be strong.

The key is to wait for price momentum to change - with a bullish stochastic momentum turn to the upside and not simply enter and hope support holds.

The RSI helps you spot the trade and the stochastic gives an idea of the change in momentum and when to take the trade.

Using RSI, support or resistance and stochastics is simple but can be very effective at spotting high return low risk trades.

Try the combination for yourself and see how effective it can be.

Swing trading is one of the best ways to make money in forex trading, it’s also a lot easier psychologically than trend following.

It’s therefore a great way to trade for novice traders. Over the last few weeks we have looked at some live examples:

Banked 4 profits, scratched one trade at break even and have one open. Let’s look at it and another potential opportunity.

First why is swing trading an easy way to trade?

When we say is easy, we mean psychologically.

You get in quick with low pre defined risk and you’re normally out in 2 – 5 days with a good profit.

This is much easier than long term trend following, in that you do not have to wait for months and see dips eat into your open profit.

Long term trend following is highly profitable but requires a lot more discipline.

We personally mix the two ways of trading to gain some diversification of style and smooth the equity curve.

Swing trading basics

We normally look for important chart support and resistance and trade contrary to it.

We wait for prices to test these areas and watch for stochastic momentum to fall against resistance or rise against support.

Then we know the level has held and trade off it.

We also use RSI and Bollinger bands to define targets and that’s it.

Nice ands simple, but can be very profitable you can read more about this method in our other articles.

British Pound

We are short at recent nearby highs and would look for a pop to the downside to Fridays low or near the middle of the Bollinger band.

Stochastic is weak at present and odds favor a bit more to the downside.

With swing trading you don’t want to hang around to long, get out on specific target and that’s very close now.

Another opportunity

Lets look at another potential opportunity that’s could be shaping up. The euro is trading near its highs and the spike high on the chart is resistance. Stochastic momentum is waning and a cross with bearish divergence will put the odds in favor of the bears.

The important point is to wait for confirmation of the crossover – the target is then Fridays low just above the middle of the center of the Bollinger band.

Finally

The tools used swing trade are simple and easy to use, but that doesn’t mean they can’t make profits as we have shown.

Importantly, for novice traders the discipline needed to trade this way is a lot easier.

If you practice a bit and learn to spot the set ups you will soon be able to spot some great low risk high reward trades – Good Luck

1. There is always a risk in Forex. That's the truth. There's a risk in anything.

Gambles go to casinos & Forex traders go towards online trading. Anybody that tells you, it’s a 100% Guarantee, is lying! Before you begin trading, make sure you put in some time and effort into studying the market + careful analysis. Any gamble is fun, except when you lose.

2. DON’T & I repeat DON’T ever put real money into a Forex account before trading on a demo account.

The reason over 85% of newbie’s fail in the Forex market is due to quickly investing in a get rich quick Forex scheme. Make sure you get a demo account, play around with it, and perfect your skills upon it. Remember, it doesn’t cost you anything. So why not give it a try first? I guarantee you’ll be better off if you go with a demo account first

3. Never ever risk over 3% of the total trading account size. Ever!

Remember the guy that said never say never… he was wrong. I can confidently say, Never ever risk over 3% of the total trading account size. This is a key in separating the Successful traders from the unsuccessful ones. I know its fun to put in more money, try to make more; become rich… everyone loves that stuff. It’s not worth it. You may win a few trades here and there. But overall, you WILL lose.