Archives: 2008 July

Forex Currency day trading is the trading of currencies on the foreign exchange market, which is also known as the forex market. It is a business regulated by the government an as well as by the local authorities. To deal with any types of currencies trading, you will need to go through a Licensed broker to help you with your purchases.

Forex currency day trading has become one of the most popular markets to invest in, more specifically because of the financial trading involved. Financially speculating has its rewards, but also has its drawbacks as well.

All types of investment have an element of risk. Thus by referring to professional advices, you are more likely to make a calculative risk when investing. This will ultimately provide you more chances of make a profit. Whether or not the profit is large or small will depend on the market circumstances as well.

The popularity of the forex currency day trading has been contributed by several circumstances unique to this market. Firstly, there are no middlemen involved which can jack up the cost. Secondly the absence of middlemen means there are also no commissions payable. And lastly, the transactional fees are very low when compared to other money market.

As with all speculation in Forex currency day trading, there is risk involved and the risk is in relation to however much you have invested in this market at any given time.

If you want to get a true understand of the forex markets, you’re not going to be able to accomplish that with the use of forex lagging indicators.

For example, an MACD indicator may be nice to look at, but can anybody who uses it actually say with great certainty that they have stronger intellectual grasp of the market.

I’m positive we all know how to use an MACD indicator, but what does it mean to the overall price movement and direction of the market? Most don’t really know.

While using indicators such as these may seem like a great shortcut for learning the forex market, the real truth is you’re just using it as a translator of the market. The indicator translates what it sees to you and shows what it sees through different colors and lines. This may seem like a great idea, but it’s really not.

You’re the one that has to be the translator, though. The market shouldn’t be interpreted by some indicator. For example, if you moved to a foreign country for a year, aren’t you going to at least try to learn the language. Sure, you can probably find people to translate for you, but do you really think you’re going to enjoy living there if you do that? Well, it’s the same exact principle in forex, except the language is price action.

It seems that most forex traders now are looking for the short cut, instead of using the oldest form of technical analysis: trading just using price action. Most traders though don’t seem to be interested.

You can tell this is true by just going to any forex forum. What do you normally see people talking about? Usually its about some magical system filled with a bunch of indicators or a Forex Expert Advisor that basically uses those same lagging indicators to come up with an automated forex trading system.

What’s wrong with this picture?

Off the top of their head they should realize that all these indicators like moving averages or stochastics are always lagging. They are great if you want to know what has already happened, but it provides no ability to forecast future prices.

The other thing that these traders need to understand is that 95% of all forex traders lose money. If that’s the case why would you want to be doing the same exact thing that every other struggling trader is doing?

You also need to think about the fact that most traders on a forum are usually struggling traders. If they weren’t struggling why would they be on a forum to learn about trading. The real successful traders don’t really have the time. They are too busy trading the markets.