We’d like to start by wishing you a Happy Memorial Day. We hope you had a great extended weekend, we sure did. Between the barbecues and the boating and the sweets…well, life is good.

Ok, so how has this month’s trading been? Well, $firstname, I’m glad you asked.

But, before we get to it, we want to give you a quick review of our trading goals.

We shoot for a 20 pip per day average, which would lead to a 100 pip per week average, which would lead to a 400 pip per month average.

If we, or you, are able to achieve this type of success our account would increase at a ridiculous rate assuming that we have a quality money management system in place.

So, now that we have that recapped…let’s move on to this month.

So far, May has been a great month for us. We have made over 1000 pips in profit (in fact more than 10% above 1000 pips) and had a win to loss ratio of better than 3 to 1 (that’s 75% for the math challenged).

In fact, in the last two weeks we only had one losing trade.

To sum it up; we have made more than double (actually more than triple) our goal in pips. A month like this accelerates our compounding scheme greatly.

Ok, enough about that…let’s move onto tonight’s trading.

With the ridiculous drop on Friday, the charts are pointing to a continuation in the downtrend. And, who are we to fight the charts.

Now that we know that we are looking to go short, let’s try and find some good trading levels.

1.8720, 1.8770, and 1.8850 all seem to be credible resistance levels. Take note of how far up we’ve come since the open of the market on Monday night. This information will come into play when you are looking for your trades.

Look for good price action around these levels to find your entry point.

As far as support goes…what support?

Obviously, there are minor levels of support in between the low of 1.8529 and the current price. All you have to do is draw Fibonacci lines and you can find minor support levels. None of these, however, are considered valid UNTIL they hold.

Also, remember, that whole numbers can act as support and resistance levels as well.

So, what does this mean to you?

This might be a good time to increase your profit targets. Maybe move your stops to break even if you get a nice move in your direction.

The reason for this rare occurrence of us mentioning how YOU should use your stops is that we want you to open your mind to different styles of trading.

No trading style is perfect for everyone. It’s very important that you take the time to learn what trading style works best for you.

Well, that’s all we have to say about tonight’s trading.

We find these support and resistance levels using a set of technical indicators and other variables that we have found to be most successful for us. We use several other indicators and a variety of technical analysis techniques to enter and exit all of our trades. Every trader will have a different combination of indicators that makes the most sense to them. Learn how to develop your own successful Forex Trading style with this Elite Forex Trading Course.

The 90% Rule – So Close to Target

We call one our 90% rule. That is basically designed for times that our mechanical objectives get within 90% or greater of full target. I can tell you without question we will never take a loss on a strategy that barely misses target. There is simply no reason to stubbornly wait out the next couple of ticks and in the meantime be willing to risk it all the way back to a full loss just because a calculated target just misses. We therefore in our minds know that if our objectives are $2.00 on a stock we will definitely have a stop adjustment if it gets to $1.80 or higher.

In fact, you might want a 50% rule. It is a good idea to ratchet up your stops (when long – opposite when short) when you get halfway to an objective. This doesn’t mean you should tighten stops so much that you get taken out repeatedly the moment it retraces even a slight amount, but it should be a level where you have some action plan built into your strategy. 50% and 90% or thereabouts are good levels to build some type of risk reduction into your plan and then some means of locking in profits. We always want to give our trades room to “breathe” – do not just get jumpy and head for the exits at the first sign of a entrancement. Going back to the concepts further up in this document, if you have a strategy that has put the odds in your favor, you have to let that strategy do its work. You need to give it the chance it needs – but ratcheting up stops (or down if short) is wise and still allows that trade room to roam and get your full objectives, while at the same time giving you the relief of cutting risks substantially and rewarding yourself for getting halfway there, and ultimately trading with a trade that you know is guaranteed to make a profit, rewarding yourself for the trade getting 90% of the way there.

What about “Key Levels?”

There are levels that markets just have a hard time passing, up or down. All support and resistance gets broken eventually so we don’t build strategies around these levels with the fear that they cannot be broken. If the case is that our profit objective requires one to be broken, then so be it.

However, you need to understand that much of trading is crowd psychology and though someone could put together a thesis on how there should be no difference between valuation of a market at 41.98 vs. 42.00 (the round number), it is a fact that traders, down to the individual basis, are the ones who are influencing these prices, and rightly or wrongly there is a lot of attention paid to key levels.

Now, you might think with all the electronic and program trading out there that these “robots” ignore these key levels but it is not difficult for any experienced trader, and therefore system developer, to realize that you have to respect these levels. So even as program trading starts to dominate many markets, they are building into these models these same behaviors.

What this means to you is that you need to know what levels “matter” in the markets you trade. It is different depending upon time frame and markets.

In the Forex markets, we always respect the “00” and the “50” levels, meaning 1.97”00” or 1.97”50” – this does not mean we do not exit the moment a market gets close. However, you can bet that if we have a set-up to buy at 1.9698, we are not going to enter that trade until it gets up and over 1.9700 and to 1.9702 or 1.9703. Same goes if we are heading short, and we get a set-up at 1.9754. We are not going short until the market breaks 1.9750, so 1.9748 for example.

Respecting key levels will add at least 5% or more to your win/loss ratio. It is measurable and can really make the difference.

The same case can be made in virtually all markets. Index futures? Pay attention on an intra day/day trading basis for example on the Russell e-Mini to the xxx.50 and xxx.00 levels. You’ll be amazed how often you will have a target that might be 830.10 and it will only get to 830. If it is close to a key level we adjust for it. Why make a market fight through a key level for an extra tick? Doesn’t seem worth the stress to us.

Same goes when setting stops. If we know day trading that the 829.”50” level should be watched and a sell stop is calculated at 829.60, you can be sure we’ll be lowering it down below the 829.50 level and instead more safely placing it at 829.40, assuming that the 829.50 level might be the area the support comes in. It is a key level.

Swing trading we wouldn’t pay much attention to the levels on that micro of a level. However, we would pay attention to the “5’s” such as 800, 805, 810, 815, 820 and even the round numbers like 806, 807, 808, and so on.

This is all just fine-tuning but it is that last thing you can do in your trading plan, it becomes total second nature, and it works across all markets whether stocks, Forex, futures, commodities, etc. It doesn’t matter. This is how you take a mechanical strategy, apply the art and experience to it and measurably improve your performance.

Never be afraid of support/resistance but be sure you at least acknowledge its existence and make small adjustments when you can – do not make large adjustments just to avoid facing down a key level, but small adjustments where you give up very little on the target or have to widen your stop just a bit make great sense.

Some of you might want to track and watch other Key Levels, such as Pivot formulas (of which there are several, all easily found by doing a basic Google Search or already built into your charting platform), Fibonacci levels (entrancements, projections, etc.), previous day highs, lows, closes, and so on.

What you don’t want to do is draw so many lines on your charts that you become paralyzed. Remind yourself that all levels will ultimately fall. They are not to be avoided, but they are to be respected. Nothing more.

Forex price movement is misunderstood by most traders. Prices don’t move in line with the news and they don’t move to some mystical recurring scientific theory either. You can win but understand the key reason prices move or lose… Here is a simple equation for forex price movement. Fundamental Supply and Demand inputs + Investor Perception = Price. Simple enough but most traders fail to see the significance of the above which is: – The news and facts are un-important its how traders perceive them as a whole that is. – Humans are emotional so you cannot predict what they will do. Those traders who think they can trade breaking news are wrong and they don’t understand the markets discount news instantly furthermore, we all have the same facts to see but we all draw different conclusions from them. How Markets Really MoveAs humans are emotional, there is no way of predicting forex prices in advance or some mystical scientific theory they move to which the far out investment crowd love with their Fibonacci, Gann and Elliot Wave based systems. If you want to trade forex, you need to see it as an odds game and play the odds when there in your favour, run your profits and cut your losses. Sure, human nature means you cannot predict exactly what will happen next – but human nature is constant and we are all governed by greed and fear and this means you get hig odds formations which can be traded for profit. Keep It Simple and Trade the Odds for Success!All you need to do is – use a simple odds based forex trading strategy and have good money management and you can win. Today traders make forex price movement much more complicated than it really is, traders try and apply ever more complex formulas and software to try and crack the code behind forex price movement but it’s all in vain – there isn’t one! Complex Systems and Maths are NOT the AnswerThis is proven by the fact that 50 years ago 95% of traders lost and the same ratio lose today; showing that advances in technology have not helped at all. This leads to the obvious conclusion that forex trading success is not dependant on being clever, complex or the application of maths and of course this is true – its NOT and the fact we have just given you, clearly shows this. How to Enjoy SuccessForex trading success is simply based upon a combination of a simple, robust forex trading strategy, with good money management which you can apply with discipline. Forex trading is an odds based market and if you learn to trade the odds, you can make a lot of money and enjoy currency trading success.

Many traders who seek bigger Forex profits want to use mathematical formulas for profit but which is the best theory to use? Let’s take a look… Mathematical theories are based on the assumption that human nature is constant and this means that market movement can be predicted if you know the equation. There are many Forex robots which claim they have found the mathematical theory and can predict prices in advance and there are other theories, such as those based on Gann, Elliot Wave and Fibonacci – but there is a problem with all them and it’s the following. To be defined as a mathematical theory, it must be a set equation that works ALL of the time, not just some of the time; that’s the definition and no theory works all of the time. If of course mathematical theories did work all of the time, there would actually be no market, as we would all know the price in advance and there would be no market! Common sense really – but most traders still try and find something that doesn’t exist. Now let’s look at a better way to trade Forex markets for profit. Forex markets don’t move to mathematics and certainties, they move to the odds and probabilities. Sure human nature is constant but it doesn’t repeat exactly to a mathematical theory, as we are creatures of emotion as much as logic. The best you can do is trade the odds – but you can make a lot of money doing this, here’s how. In Forex trading more of the top traders have come from a background of poker than mathematics and the poker players have a big advantage over the mathematicians.They keep Forex trading simple and are used to taking small losses and waiting for high odds set ups and that’s exactly what you need to do to win. Most mathematicians think that their clever, so they deserve to win and they have egos. They keep making their theories more complex and they have more elements to break in the brutal world of trading also, they hate taking small losses as it hurts their egos and let them run which ends up in an account wipe out of equity. If you want to make bigger Forex profits, forget mathematics and prediction and trade the reality of price change and the odds. In the last 50 years, we have seen massive advances in mathematics, forecasting, the power of software and a huge number of new investment theories – but guess what? The ratio of winners to losers remains the same! This means that all these advances have made no difference to the winning number of traders. Many people try and make Forex trading complicated, when it’s essentially simple and relies on a simple Forex trading system which the user can apply with discipline. In Forex trading, don’t look for order when its not there. Accept the markets for what they are – a game of odds which if you play them correctly, you can win and make bigger Forex profits.

Day Trading continues to be one of the most alluring professions as it is one of the few professions that allows you to be self employed and completely independent of bosses, employees and even clients.  It is a profession that you can also do easily from home.  All you need is a computer and high speed access to the internet.

 However, Day Trading is also one of the most difficult professions, with a failure rate estimated by most as at least 90%.  The biggest reason for this high failure rate is that most new day traders start out with too little capital, and the expectation of being able to pay their bills with their trading profits.  Another big reason for this high failure rate is that most new traders start without a coherent game plan or strategy to trade.

 Due to the nature of the financial markets as being one of the few ways an individual can make a lot of money in a short period of time, there is a substantial amount of information trading that is forced down the throats of new traders.  Much of this information is usually the typical package of indicators that may indicate whether a stock or market is overbought/oversold, or some kind of price pattern or price/volume relationship that may identify a favorable time to trade.  There is also the more radical type of information based upon Elliott Wave, Fibonacci, cycles and even astronomy. 

 However, it is rare that you will actually read any information that provides you with a strategy for identifying a market to trade, when to trade, how much equity to risk, when to exit when the trade goes against you, when to take profits, etc.  Once you are provided with their magic indicator, you are forced to come up with this information on your own. 

 Well, here are a few tips for successful Day Trading. 

1. When you are Day Trading individual stocks, look for stocks that have significant volume and liquidity.  The same can be said for other markets, such as commodities, currencies, interest rate futures and stock index futures.

2. When you begin Day Trading, keep your initial profit goals modest, and never start Day Trading without another means of income to pay your bills.

3. Before you begin Day Trading, you should have a well thought out, basic strategy for trading the markets you plan to trade.  For instance, if you are looking to scalp in and out of the markets throughout the day, develop a strategy that allows you to utilize 5 minute charts or even shorter time frames, that looks for a specific trading set up that allows you to enter a trade while minimizing your risk. 

4. Once you have developed your plan of attack, think about potential situations where you may have to deviate from your plan.  For instance, you may enter a trade based upon your strategy, but the market does not act as it should.  Sometimes, it just pays to exit, rather than wait for the market to stop you out.  You can always move on to the next trade.  The best trades will usually move in your favor quickly if you enter at the right time. 

5. Consider multiple entries and exits for a single trade.  For instance, on a short-term scalp trade, set a profit target that allows you to lock in some profits fairly quickly.  Once you have locked in that bit of profit, you can let the rest of the position ride in order to shoot for a more significant profit with little risk.

6. When trading individual stocks or stock index futures, consider learning how to read the tape to put the odds more in your favor.  For instance, trade only in the direction of the underlying trend of the market for the day, and confirm this trend with such indicators as the Advance/Decline ratio, TRIN, Tick, and the performance of all of the major indexes. 

7. Look for price patterns on the daily charts that may hint at a directional bias for your market of choice, then trade in the direction of that bias.

8. Avoid taking trades in the first 15 minutes after the market has opened.  This is amateur hour.  The true direction of the market you are trading will usually reveal itself after this period of trading. 

9. Make sure your strategy adjusts your position sizes to account for changes in market volatility.  As volatility rises, lower your position size, and as it falls, increase your position size. 

These are just a few tips worth considering as you embark on Day Trading.  Remember, there is no perfect strategy that will be profitable 100% of the time.  However, if you develop a strategy that puts the odds in your favor, and you are able to stick with it in the long run, you should find yourself to be profitable in the long run.  

Scott Cole www.bestdaytradingstocks.com www.kungfutrader.com

Start Today Earning Thousands as a Successful Forex Trader

Everyone is talking about the Forex. The foreign exchange rate has changed dramatically or the last ten years. The change has taken place due to the internet and technology. As a forex trader you can trade 24 hours a day except on weekends (from 22:00 UTC on Sunday until 22:00 UTC Friday). The trading can be done anywhere there is an internet connection. 

Sounds to good to be true you are thinking. The Forex is great place to trade. But, you do need to educate yourself with some basic knowledge. You don’t need any special degrees or diplomas to start training on the forex. There are a lot of great sites on the internet with forex tools that will help you to start your  training education.

You will need some basic knowledge in the economic arena. 

1.Payroll Unemployment

 Strong job creation is a good indication of economic growth, as companies must increase their workforce in order to meet demand

2. The Discount Rate FOMC Interest Rate Decisions 

The Federal Open Market sets the discount rate, which is the rate at which the Federal Reserve Bank charges member banks for overnight loans.

3. Trade BalanceThe balance of trade measures the difference between the value of goods and services that a nation exports and the value of goods and services that it imports.

4. CPI – Consumer Price IndexThe CPI is a key gauge of inflation, as it measures the price of a fixed group of consumer goods.

5. Retail Sales

Retail sales is a measure of the total goods sold by a sampling of retail stores. It is used as a gauge of consumer activity and confidence as higher sales figures would indicate increased economic activity.

This data is public information and easy obtained via government websites, newspapers and online resources.

Now that you have some basic knowledge of economics your next step is to open up a demo forex account. You will need to purchase an automated forex trading software application. Look for a forex software application that has a demo account. Using a demo account is a great place to start it is free. Who doesn’t like free. When you feel confident and ready to start trading you can open up an account and start making money.

The mini forex is a good place to start for people just entering the forex market. The mini forex allows you open an account that is at a reduced amount. It requires a smaller capital compared to regular forex accounts, a minimum of $300. With mini forex trading, you can control a $10,000 currency position. The key here is leverage. Because of leverage, a trader can trade in a commodity more than the money available in his account. Say with a $250 deposit, one could trade a maximum of 5 mini lots. This kind of leverage is greater than stocks or day trading. Of course, it is recommended to start with a manageable leverage that allows greater flexibility in transactions. Now that you have started trading on the mini forex if that is the route you have taken there are few other concepts to learn. They concepts are moving averages, Fibonacci levels and Bollinger Bands. These are ratios and measurements used to determine the highness or lowness of the price relative to previous trades. You just need a working knowledge of these concepts. Your automated software will handle all the mathematical calculations for you. 

Now that you have a good knowledge of these concepts, there is one other thing we must consider. Fear, which can be the worst enemy of the Forex trader.  To become a profitable trader you must leave fear aside and stick to your trading plan.

In conclusion, the key to being a successful forex trader is to have the knowledge and proper psychological preparation. 

Tracy Lenyk

http://www.forex-money-exchange.com/forex_products.php

Every person that has to complete a task will do everything possible to solve everything in a single day without postponing any activities. That happens mainly because they would rather keep a clear schedule for the next day for any new tasks. Kids manage doing all that very easily and we can follow their example. Every day they go to school, they come home, change their school clothes, eat and then go out to play with their friends. After a few hours on the playground, they come back home and complete their homework just in time for the family dinner. As you can see, in just a few hours they can do so many things without leaving anything for the next day.The same pattern is recommended for foreign exchange trading because the investor has to complete an order before the day is over. Any regular transaction will take place in less than 24 hours and usually they can deal with multiple transactions each day. By doing all that in a single day they avoid any risks and increase their earnings. Any investor knows that the forex day training strategy requires a business plan and a strong analysis for the ebb and the flow on the market. All this will help them save time during trading and invest in other currencies that might bring some profit. This is the perfect method for safe players that are only aiming for a decent profit without taking any unnecessary risks. Everything now is about speed because low risks equal moderate returns and in this equation time is money. Using this strategy, a good investor can complete up to six traders per day. Nowadays, forex day trading strategy is very important but that happened only after people discovered that the foreign exchange market is not an exclusivist club and they can join in anytime.The most popular is Fibonacci day trading strategy because it can handle several different indicators. This method adds up the first and the last numbers in the sequence plotting the ratio levels providing a close estimation of the possible earnings. In other words, all this will help the investor analyze his support and resistance level on the market.

Today there are many predictive theories of Forex price movement and the speed and processing power of modern computers means that programmers can develop ever more complex theories to predict prices so which one is the best? Let’s find out…

Mathematical theories are not new and theories such as Gann, Elliot Wave and Fibonacci have been used by traders for decades and today we have the Forex robots and expert advisors which claim there complex mathematical algorithms can beat the market, so we have a lot of theories to choose from.

In our search for the best mathematical theory, let’s make a point:

Forex markets are moved by humans.

Humans by there very nature do not think logically so markets cannot move to mathematics and they did, we would all know the price in advance and there would be no market! For a theory to be mathematical it must work ALL of the time otherwise its not mathematical! No theory that claims to be mathematical works all the time and thats a fact.

So the answer is there is no way of beating the market and no hidden order that allows you to predict Forex price movement but you can win at Forex trading. You must however see the Forex market for what it really is.

The Forex markets move to probabilities, not certainties; the good news is you can spot high odds trades and by trading high odds set ups, you can become a winner in the long term. All you need to do is keep your losses small and run your profits.

Another key fact you need to keep in mind is simple systems, work best in an odds based market and the following fact proves the point.

In the last 100 years, the ratio of winners to losers has not changed and this is despite all the advances we have seen in technology in the period.

Simple systems work best, as they are more robust in the brutal, ever changing world of Forex trading than complex ones which have to many elements to break.

So get yourself a simple Forex trading system and trade the reality of price change as it happens, rather than predicting and you will get the odds on your side. You then simply need to apply your system with discipline, keep your losses small and run your profits.

Traders continue to buy into the Forex robot and Forex expert advisor myth, that claims science can beat the market but all these systems all lose money and do so quickly.

Currency trading success is open to anyone. You can learn to trade successfully, you just have to see the markets for what they really are a market of probabilities. Complex mathematics and technology enriched our lives and made them easier over the years but to assume technology can help you gain an edge and predict the markets is not based on any facts and the opposite is true, simple systems work best and always will.

The fact is currency trading is a learned skill yet, traders keep making to the same mistakes and losing and that’s why the ratio of losers stands at 95%. If you want to win you need to avoid the mistakes enclosed. Top of the list of mistakes has to be the traders who think they have to make no effort at all to win and they try and buy success! 1. Using Forex RobotsThese cheap software packages, all claim they will make you rich with no effort and this great income is yours for a hundred dollars or so but these systems don;t work that’s why there so cheap. If you want to win at Forex trading, avoid these robots and the laughably named Forex Expert Advisors and get yourself a solid Forex education. 2. Complicated Strategies and Intelligence Guarantee SuccessThis is not so, Forex trading is simple and complex systems simply break easily in real time trading. Intelligence may help you in life but not in the Forex market, you need to keep it simple and last but not least, you don’t need to work hard either, working hard doesn’t guarantee success just being right with your trading signal does. 3. Forex Markets are Predictable in AdvanceIf they were, we would all know the price in advance and there would be no market! Humans are creatures of emotion not of logic and what Forex traders might do in advance, is impossible to predict. Of course this doesn’t stop traders trying to predict and losing, all their doing is guessing and that’s no way to make money in Forex. There are also the theories the far out crowd love like – Fibonacci, Gann and Elliot wave, all claim to have found the hidden code of the markets but traders lose with them, don’t believe the mystical nonsence, simply base your trading on the reality of price change on a Forex chart. 4. Not Trading with DisciplineThis is a key mistake and the one that wipes out a huge amount of traders and the reason is they cannot accept losing. Your going to lose for periods in Forex trading and all you have to do to win long term is keep losses small and run profits but most traders simply cannot do this. They take losses personally and run them, trade to much to get losses back or swap systems!If you can’t trade with discipline and stick to your strategy, you will lose, trading discipline comes from a good currency trading education and confidence in what your doing and if you want to get the right mindset you can. Anyone can Win at Forex Trading As you can see from the above anyone can win at Forex trading, if they have a simple method, based on trading the reality of price change and a disciplined mindset – so they can follow their plan to long term trading success.