Forex Tools and Computer Requirements

If you have just recently encountered Forex as one of the best online investment that could provide you huge profit in return then there are a few requirements that you need to know about regarding the tools that are to be used and the capability of your computer.

Let’s start with the discussion about the software tools.

After you have found a reliable FX Broker they are going to provide you their Deal Station software. This is also known as the “Trade Station” or “Trading Terminal”. 

The use of this software allows you to have an access with the currency pairs and place your trades. 

Other details are also provided such as the Dealing Rates, Open Trades, Entry Orders, Account Balance, News and etc… The more information that they could provide means the better.

Most Deal Stations offers you the charting platform and the most popular among them is the Meta Trader 4 or more commonly known as the “MT4” for short. 

You can download this Trading Terminal for free and it is popularly shared on most Forex related websites.

The Charting Platform of your Trade Station should consist of various sets of technical indicator tools and provides you multiple different time frames. 

The most common time frames used are the 1, 5, 10, 15, 30, minutes, 1 hour, 4 hour, Daily, Weekly and Monthly. 

Take note that some traders will only use a certain range of time frames to base their analysis and speculations.

The Computer Requirements

You won’t be able to perform your trading activity if you do not have your own personal computer and it is a must requirement. 

Anyway, your computer should be fast with a processor of Pentium 3 or higher. Lower than what is mentioned here will still allow you to install and use the Trading Terminal but you will be experiencing lags and delays on placing your trades.

The minimum required RAM should be 256 Mb but there are still some instances where your computer goes slow and these are due to some malicious files that might have infected the system. 

Therefore, it is recommended to increase your computer’s RAM to avoid such problem.

Having huge or dual type of monitor screen is just optional where an ordinary type works just fine. 

However, the use of huge screen or dual monitors provides you an additional advantage on trying to keep an eye on your multiple charts.

Fast internet connection is also recommended where you have to subscribe on those Broadband or ADSL services. 

Dial-up connections might also be good but there are some situations where the connection goes unstable.

You should only use those Windows Operating systems such as the Windows 2000, XP, 7 and etc… because most of the software offered only works on this OS.

Moreover, if you have not yet found any Forex broker that you wish to invest your capital then there are a few important things that you should need to consider. 

Honesty and Reliability are the two most important factors that you need to know about. The forums and blogs are the good places to check the reputation of the Broker that you intend to join. 

Try and ask those individuals who are using their services whether they are fully satisfied or disappointed.

Meta Trader Email Settings

The Security of your information must not be shared from any third parties of your Broker. 

If they do, you will be surprised to receive an email-spam and you might even receive anonymous calls offering you their products.

Accurate Order Execution is very important because every pips count. You can check the accuracy of any broker’s Order Execution with their Demo or Virtual Account.

Marketiva Platform Review

Most forex traders are already aware about the existence of Marketiva where it offers attractive features and services. 

You can even start trading the market for free by simply registering an account. Take note that creating multiple accounts is strictly prohibited and it must be avoided.

One of the best features of Marketiva is their Customer Support that actively answers all related concerns and issues about their trading platform. 

You can contact them through the Chat-Box where you will receive an immediate reply. Some delay can be experienced if there are too many inquiries but this rarely happens.

The bonus for successfully creating an account is worth $5 dollars. 

They might change this amount to increase more traders’ interest to join but I think that this will never going to happen as they already accumulated huge numbers of traders. 

You can freely use your bonus to trade Live but you are not allowed to withdraw this cash unless you have managed to triple the amount.

Other requirements before you are allowed to withdraw your earnings are scanned copy of your valid ID (Identification Card) and any Proof of Billing containing your name and current address. 

You have to send these documents for confirmation on Marketiva’s official website under the Account Center. It might take a few days before your documents are checked but normally it takes around two to three days period.

Marketiva’s platform is known as the “Streamster”. 

Its file size is 524 KB where it simply takes slight seconds to be downloaded. After completing the download, you have to install the program on your Operating System. 

Take note that Streamster will only work on Windows 98/ XP/ ME/ 2000/ 7 and Vista. To all MAC or Linux users, it’s too sad to that they are not currently support.

The trading platform offers two types of an account which are the Demo and Real Account. The Demo account provides you a default amount of $10,000 dollars that you can use for practice purposes. 

If you have lost this entire amount then you can contact the service support to reset the amount. The Real account contains your investment or deposited money. Your $5 dollar bonus is automatically added on this account.

Meta Trader Virtual Account

Streamster currently supports 20 different currencies with spreads that ranges from 2 and above. There might be changes on this part as they conduct upgrades to further improve their services.

Gaining profit on trading the Forex market can be easily done provided that you have good knowledge and strategy. 

This will allow you to withdraw your profit or simply re-invest to increase your capital. Anyway, you can withdraw your earnings on Marketiva through e-dinar, Liberty Reserve, Web Money and Wire Transfer.

Trading the Breakouts with great Success

There are currently hundreds of available trading methods out there that it will surely take you years of trying and defining what works best for you. 

Most strategies are the technical or mechanical type of trading style where the aim is to simply buy at the lowest price and sell at the highest price of the current market. 

The reason is that the behavior of the market often goes for a trend and comes back at the normal price level.

Some traders especially newbie think that they can make money by simply predicting the direction of the trend. Predictions offer a huge risk and often lead into a complete failure and lose of an account.

One of the best method that guarantee your success in trading the Forex market is to trade only on a high odds where there is a good confirmation of the trend’s direction. 

Try and observe your trading chart. You will notice that the bullish trend always starts in the same manner especially when it breaks through overhead resistance. 

Sometimes it even moves further making a new high and it’s the reason why it’s best to make a buy on breakouts.

Defining for buying at the right breakouts can be done with the help of your resistance levels. 

If the resistance has been tested several times in the past and held before the break then there is a high probability that a bullish trend continuation will mostly likely going to occur.

A six or more tests are already good enough to confirm the strong level of the resistance. The wider the gap of the tests in terms of time provides the best odds for the breakout to continue.

The Bolinger Band Breakout

Trading the Breakouts offers a very high reward and with a very low risk of losses because the stop loss is always close or near the level of resistance. 

If you managed to hit the high odds of a certain breakout then your profit can tremendously increase depending on how far the range of the market will trend.

You may simply choose just to trade on the break of resistance levels but you can also choose to use other tools such as momentum oscillators to further confirm the best signal that you wish to take.

Forex Trading Course

Most new traders tends to use Mechanical or Technical Forex trading system while others are undergoing courses offered by any professional gurus. 

There is no wrong option between the two where they can both lead into a trading success as long as you are comfortable. 

Anyway, the focus of this topic is about learning Forex Trading in a more detailed discussion.

It is always emphasized that Forex Trading is a risky business where almost 95% of all traders lose their money and this should serve as a warning for those who wish to be involve on this line of work. 

Anyway, there is no type of investment that doesn’t involve risks if such exist then everyone could become a millionaire for a life time. 

Buying a system on the market does not guarantee you to make profit especially when you are using it the wrong way. 

You will simply lose your money and the sure winner of the game is the vendor who made an income from selling his so called profitable trading robot.

Learning is the best way to go if you wish to achieve success in trading the Foreign exchange market. 

It would really require some effort of learning all the basics and putting all the knowledge that you have acquired into practice. 

The good part is that you will be able to generate money with a high probability of success. You can almost learn everything online by searching through your favorite search engine. 

There are several informative website and blogs out there (like this one) that you can always browse and read the contents as your references or even participate on a Forum Communities. 

If you are still having some trouble trying to understand the basic concept of trading the market then you can enroll to any online Forex Courses.

A Professional Trader will be your teacher on the course that you have chosen to enroll. He will be teaching everything about his system and to share his successful experience. 

The strategies and tools are also provided by your teacher which is used to make profits. 

Before everything starts-up, the logic and strategies are well explained to let you have some confidence on your trades. 

To prove that the system being taught works you will be able to check or trade at the same time with your instructor and it’s up for you whether to keep on learning the method or not.

There are several courses offered today and the best once are those that you can try them risk free for a period of one or two months. 

If you are not satisfied of what it is being taught on the course or simply cannot follow the concept then you can always withdraw and get your full money back.

The MetaTrader User Guide

If you do not have the money to spend on such courses then you can always rely on any forum community. 

As for your trading platform, you can learn every function by simply referring to its User Guide.

Multiple account on Marketiva

Do they allow multiple account on Marketiva?

The answer is no and it is against their TOS or policies. Violating this rule will make all of your existing account banned and you may never be able to trade again on their services. 

If your purpose is to create several accounts in the aim of claiming multiple bonuses from the registration then this is a bad idea because you won’t be able to withdraw this amount without supplying valid documents. 

You need to send them a scanned copy of any proof of billing containing your real name and address.

Trading on Marketiva will require you to download their software which is the “Streamster”. The file size is 524 KB and it works on Windows 98/ Me/ 2000/ XP / 7/ and Vista. 

The installation process is easy to set-up where all you just have to do is to follow the instructions. The hard part is familiarizing yourself from their trading platform where you have to learn how to place an order and layout your indicator tools on the charts.

Marketiva’s trading platform comes with some default indicator tools that you can use to analyze the behavior of the market and predict future price movement. 

The downside of the Streamster is that you cannot import any customized tools as compared with the Meta-Trader. 

It also doesn’t have any Expert Adviser or a program that runs automated script for auto-trading.

Streamster also comes with other services such as being updated with the latest news that will be released before it occurs. 

This will allow you to avoid any unexpected volatility of the market. 

If you are having some trouble about their trading platform or encountered technical errors then you can immediately talk to their technical support representative in the form of chat. 

You will receive an immediate response about your concern which is the good part of their services.

My best experience in using Marketiva is that you can trade in nano-lots and you do not need a huge amount of capital to begin. 

The lowest amount that you can deposit and start trading is only $1 dollar which is perfectly good for all starters to experience real trading.

Meta Trader Order Form

In comparison with the Meta Trading Platform, the lowest amount of volume allowed for you to place an order is worth 0.01

Basic Requirement to Start Trading

The first time that I encountered Forex, I thought that it is another form of GPT or “Get Paid to” Programs. The first FX Broker that I signed-up for an account is the Marketiva. 

They are offering a worth of $5 dollar bonus during that time and I am happy to be able to claim it without any problem. 

Trying to trade for the first time, I had immediately lost my free $5 dollar bonus and I came to realize that trading the Forex market is not an easy thing to do.

There are a few requirements that you must have before you can participate on the trading business and they are the following:

1. Trading Platform

If you have found the Broker that you can trust then they will provide you their trading platform which is also known as “Deal or Trade Station”. 

This program will allow you to have access on various types of currencies and enable you to place your trades. 

Details such as Dealing Rates, Open Trades, Entry Orders and Account Balance are also provided.

The most important part of the platform is the charts with some default sets of indicator tools that you can use. 

There are three different types of charts which are the Line, Bar, and Candle Sticks and they come in multiple different time frames which are the following:

1, 5, 10, 15, 30, minutes, 1 hour, 4 hours, daily, weekly and monthly

Chart Time Frame

Technical traders have various strategies where they use different time frames in analyzing their best possible entry and exit price level.

The Marketiva Platform contains all the important tools required but most traders prefers to use the MT4 or Meta Trader 4 because you can fully customize your own script that will automatically run your trades. 

With the addition of those new FX Brokers, they also have their own unique trading platform.

2. Computer

You must have your own computer where renting on an internet shop is not advisable because your account can be stolen. 

Anyway, you must have a very fast computer where Pentium 3 or higher is recommended. As for the monitor, you are free to use any sized as long as you are comfortable on viewing your trading platform. 

The minimum requirement for the RAM is 256 MB. Take note the insufficient RAM memory could cause your computer to function at a very slow speed.

3. Internet

You must have an internet connection that is always stable. Broadband or ADSL and Cable are recommended while Dial-up can also be used but with some factors that are needed to be considered.

4. Operating Software

Most trading platform are designed to work on Windows versions but is could also work on their types of Operating System such as Linux but it will involve you to have some technical configuration.

Moreover, the most important requirement of all is that you must have knowledge and experience before taking Forex as a serious business.

Fundamental or Technical Analysis

The Forex market allows anyone to participate on the currency trading business. 

Some of these participants are the Governments, Reserve Banks, Large Mutual Funds, Hedge Funds and even Individual traders at home. 

I myself is an individual trader where all I need to join the trading exchanges is a computer with a stable internet connection.

If you have been on some other related Forex websites or Blogs then you must have been already warned about the danger and risks of losing your investment. 

Through the years of my trading career, I have lost numerous times and it is due to greed and lack of education. 

This has proven that trading Forex is totally risky especially when you do not know exactly what you are doing.

The most important factor that every trader should try to develop is their analytical skill to analyze the behavior of the market. 

These are the fundamental and technical method of trading style. However, more guaranteed result can be achieved by combing the two methods.

The main focus of this Fundamental Analyst is to study the condition of the Economy, Social, Political and Geographic forces influencing the type of currencies that are being analyzed. 

These factors have the potential to drive the supply and demand on a certain level of prices.

The primary tools of the Fundamental Traders are the Micro-Economic indicator such as the Interest rates, Inflation, Unemployment, Economic Growth Rates and etc… 

Analyzing these events on how they are going to affect the behavior of the traded currencies is the hardest part where only a financial expert is capable of doing. 

However, even professionals do commit mistakes on their analysis so it’s always best to be prepared on taking the risk.

Technical Analyst tends to study the previous price movement of the market. They analyze the past historic data of the currencies and based their decision in trying to predict the future price trend direction. 

All technical traders believes that the “Market repeats itself” which mean that the next trend can be determined by studying Price Action.

The basic tools of a Technical Trader are charts where they use it to define profitable trend and patterns. 

The concept of their analysis is that the market will always move in two different directions which is either Bearish or Bullish condition. 

Their aim is to be able to define the best possible entry level before the trend starts to be developed.

Past Historical Data

Whatever type of trading style that you prefer to adopt, the most important part is that you are gaining profit and enjoying the method without suffering too much stress.

Size of the Forex Market

The Forex Market has a continuous operation of 24 hours in a period of 5 days a week. 

Some brokers disable their trading platform during the week-end while others allow their traders to open a position in exchange of paying a high-cost on their spread. 

Actually, the global currency exchange market never stops. It operates even on Saturday and Sunday where the slight movement can be noticed on your chart during the start of the trading week. 

This is known as the “Gap” because the last closing price will not be the opening price.

Trading will begin at 5 PM of Sunday, New York time. The market will open starting from Sydney and Singapore then followed by Tokyo at 7 PM. And finally, London will open at 2 AM and New York at 8 AM.

The world foreign currency exchange market does not have a main or central office location where the trading processes are conducted. 

Players of this game compose of Banks, Companies, Individual Traders and other Institutions.

Forex is by far the largest market in the world where there’s an estimated value of 1.85 US trillion dollars that are being exchanged everyday. 

If we are going to compare it on the NY Stock Exchange it will have to take at least three months period before the same amount can be achieved. 

The FX market can accept unlimited amount of trading transaction and volumes at any given period of time. This makes the other types of trading market nothing when compared. 

One advantage of trading Forex is it’s characteristics of being liquid which mean that you can immediately Stop or Close your Opened Positions without any problem of suffering from slippage.

Participating on trading the FX market will require you to have a dealing station or more commonly known as “Brokers”. 

Their primary task is to match your BUY and SELL order on the real-time market prices with some cost as their own commission. 

There are several FX Broker out-there where it’s so easy to join plus most of them are giving free bonuses by simply registering an account. 

Such other bonuses offered is that you will be receiving an additional percentage on every successful deposit that you have made on your account.

All Brokers allow their traders to trade a variety of currency pairs. These pairs are categorized into three types which are the Major, Cross and Exotic currencies. 

Major types are those that are paired with the USD and the following are some examples:

EUR/USD, GBP/USD, AUD/USD, USD/JPY, and USD/CHF

Cross currency pairs are those that without any relationship to USD such as:

EUR/GBP, EUR/JPY, GBP.JPY and EUR/CHF

Exotic currencies are pairs that are not commonly traded by everyone and offered by a few Brokers only. The downside of trading them is that it could cost you a huge amount of spread.

Moreover, if you really intend on investing your money online then trading the Forex market provides you a good opportunity. 

You just have to put some time and effort in trying to educate yourself and gain experience through practice.

Managing your Margin Level

On every Forex website that you visit you will notice that they provide warning about the trading the FX market where it involves a high risks of losing your entire investment or capital. 

I have been hearing on various forums that some newbie traders had even instantly lost their entire account balance on just a few trades. 

Anyway, there are several ways on how to prevent such horrible situation from happening where managing your margin correctly is just one of them.

The margin serves as a protection to prevent further losses from occurring especially when the market has decided to go against your speculation. 

All FX Brokers has now the management capabilities that automatically implements margin on your account. 

It works automatically by closing all opened positions when your available balance had fallen below the required marginal level. 

This function will also prevent your account balance from falling into a negative amount no matter how volatile is the market condition.

Most Forex Brokers requires a minimum of 1% margin to maintain an open trade but just to make sure, it’s always best to contact your Technical Support to provide further details.

We will be using the 1% percent margin requirement on this example:

Currency Pair: GBP/USD
Rate: 1.6332/1.6337
Type of Account: 100 000/Lot
1% Leverage: 100 000 X 0.01 (1%) = 1000 Units

Opening a BUY or LONG position will require a margin calculated below:

Formula: Currency Pair X Leverage = Margin Per Lot
1.6337 X 1000 = USD 1633/Lot

Some Brokers might round-off the value into a worth of $1,700 margin for GBP pairs.

What is Margin Level?

Margin level is the ratio of your account equity to the margin required for any open positions. 

It's calculated as follows:

Margin Level = (Account Equity / Used Margin) x 100

Account equity is the value of your account after any profits or losses from closed trades have been added or subtracted. 

Used margin is the amount of money that is currently being held by your broker to cover any open positions. 

The margin required for each trade depends on the size of the trade, the currency pair being traded, and the leverage being used.

For example, let's say you have a $10,000 trading account and you open a position with a margin requirement of $1,000. 

Your margin level would be calculated as follows:

Margin Level = ($10,000 / $1,000) x 100 = 1,000%

This means that you have 10 times more equity than the margin required for the open position. 

A margin level of 100% means that your equity is equal to your used margin, while a margin level of less than 100% means that your equity is less than your used margin.

The Risks of High Margin Levels

Having a high margin level might seem like a good thing, as it means you have a lot of equity to cover your open positions. 

However, it also means that you're using a lot of leverage, which can be risky. Here are some of the risks associated with high margin levels:

1. Margin Calls

If your margin level falls below a certain level, your broker will issue a margin call. This means that you'll be required to deposit more funds into your account to cover the open positions. 

If you're unable to do so, your broker may close out your positions, potentially resulting in significant losses.

For example, let's say you have a $10,000 trading account and you open a position with a margin requirement of $1,000. 

If the position goes against you and your equity falls to $1,000, your margin level would be calculated as follows:

Margin Level = ($1,000 / $1,000) x 100 = 100%

At this point, you're at risk of receiving a margin call. If the position continues to move against you and your equity falls below $1,000, your margin level will be less than 100%, and your broker may close out your position to protect themselves.

2. Losses

Using high leverage increases your potential profits, but it also increases your potential losses. If a trade goes against you, your losses will be magnified by the leverage you're using. 

This can result in significant losses if you're not careful.

For example, let's say you have a $10,000 trading account and you open a position with a margin requirement of $1,000 and a leverage of 10:1. 

If the position goes against you by 100 pips, you'll have lost $1,000, or 10% of your account. If the position goes against you by 200 pips, you'll have lost $2,000 or 20% of your account. 

This shows how using high leverage can quickly lead to large losses.

3. Emotions

Trading with high leverage can also lead to emotional trading. When you have a lot of money at risk, it's natural to feel anxious or nervous. 

This can lead to making impulsive decisions, such as closing out a trade too early or holding onto a losing trade for too long. 

Emotional trading can be very dangerous, as it can lead to making poor decisions that can result in significant losses.

Tips for Managing Your Margin Level

Now that we've discussed the risks associated with high margin levels, let's look at some tips for managing your margin level effectively:

1. Use Stop-Loss Orders

A stop-loss order is an order placed with your broker to automatically close out a position if it reaches a certain price level. 

This can help to limit your potential losses and protect your account from margin calls. When placing a stop-loss order, it's important to choose a level that's both realistic and provides adequate protection.

2. Set Realistic Trading Goals

Setting realistic trading goals is an important part of managing your margin level. It's important to have a plan in place for each trade, including a target profit level and a stop-loss level. 

By setting realistic goals, you can avoid taking on too much risk and potentially blowing out your account.

3. Use Proper Position Sizing

Proper position sizing is crucial for managing your margin level. It's important to only risk a small percentage of your account on each trade, typically no more than 1-2%. 

This helps to limit your potential losses and ensures that you have enough margin available for future trades.

4. Monitor Your Margin Level Regularly

Monitoring your margin level regularly is essential for avoiding margin calls and maintaining a healthy trading account. 

It's important to keep track of your account equity, used margin, and margin level at all times. 

This can help you to avoid taking on too much risk and ensure that you have enough margin available for future trades.

5. Use Lower Leverage

Using lower leverage can help to reduce your risk and prevent margin calls. While higher leverage can increase your potential profits, it also increases your potential losses. By using lower leverage, you can reduce your risk and potentially avoid margin calls altogether.

Final Words

Managing your margin level is an essential part of Forex trading. 

By understanding what margin level is, the risks associated with high margin levels, and strategies for managing your margin level effectively, you can improve your trading performance and avoid potentially catastrophic losses. 

Remember to use stop-loss orders, set realistic trading goals, use proper position sizing, monitor your margin level regularly, and use lower leverage to reduce your risk. 

By following these tips, you can trade Forex with confidence and achieve your financial goals.

Forex Quoting Conventions

Opening your trading platform will provide you several types of currencies and they are usually quoted in pairs. 

The first type of currency is referred as the “Base” while the second is known as the “Counter or Quote Currency”.

Along with the quoted pairs of currencies are their prices that have five significant digits. Simply deduct the price of the base from the counter and the result is what they called “Points” or “Pips”.

Comparing Forex from stock Trading, they are almost similar where it also includes “Bid” and “Ask” or “Buy” and “sell” prices. 

The primary concern of all brokers is to provide their traders the Bid and Ask prices in real-time. This will allow you to receive the best fair price of currencies on the market.

Opening any type of currency pairs or instrument will cost your to pay a certain amount depending on the number of lot size that you wish to trade. 

This cost is what they commonly called as the “Spread”. Take note that different FX Brokers vary in the cost of their spreads.

To provide further explanations about the Quoting Conventions let’s have an example:

EUR/USD Qoute 1.4550/1.4553

The pair of currency used on this example is EUR/USD. The EUR is identified as the “Base Currency” while the USD is the “Counter or Quote”. 

Along with the instrument is the current price value of EUR/USD. This means that a price of 1.4550 EUR is equivalent to 1.4553 USD.

If we are going to deduct 1.4550 EUR to 1.4553 USD then,

Pips or Points = Base – Quote = 1.4550 – 1.4553 = 3

A result of 3 Pips is calculated. This is the immediate cost that you will be paying the moment that you have opened a position on this type of instrument. 

The 3 Pips is commonly referred as the “Spread” and it is an instant loss on your part but it can be recovered when the market moves into your speculated trend direction.

The Method of Scalping for Profit

There are three different types of being a technical trader and one of them is the Scalper type. They are the traders that often take short trades with a minimum target profit that ranges from 10 to 50 pips. 

This type of trading style has the potential to earn huge amount of profit but there’s also a high risk that are involved.

What are the risks of Scalping?

One of the most crucial problems encountered when trading is that emotions will come into play. 

You will come to the point where you cannot make your own final decision such as whether to take your losses or not. Making the wrong decision will contribute into more losses on your investment. 

This is the risks when it comes to being a Scalper because it involves opening multiple sets of trades. However, this problem can be minimized by having a good Money Management Strategy.

Scalping for profit is the hardest type of technical trading style and it is due to the high volatility of using the small time frames. 

Scalpers refer their analysis from their charts with a time frame that ranges from seconds, minutes and hours. 

The behavior of the market on these periods will show rapid movement that allows the trader to scalp for some short amount of pips.

If you are still a newbie, you will find that scalping is a very hart type of trading style. 

You will be monitoring your chart most of the time where you can’t let lose the opportunity to enter your trade when a positive signal have occurred. 

It’s for this reason that will cause you to build-up pressure and stress on your part until you will become desperate to make any unnecessary trades.

You have to know that the method of trying to scalp the forex market is not recommended for beginners. 

If you still intend on practicing this method then you must already have a good background and perhaps you might need a professional coach to guide you on everything you need to know about.

There are hundreds of products available online which is all about Scalping Strategies but you need to spend some amount of cash. 

If you do not have any extra money on your pocket then there are several free strategies that you can learn and use. 

You can easily find them on forum communities where you can interact with the other members and ask anything for clarification. 

I would like to recommend BabyPips.com for the beginners while those that already have some knowledge can directly visit or join ForexFactory.com

Tick Charts used by Scalpers

Moreover, mastering the art of trading forex through any scalping method provides a very high risk no matter how good you really are. 

The good part is that it provides a very rewarding huge amount of profit. It is far more profitable when compared to the other technical trading style which is either the Day-Trader or the Long Term-Trader.

Technical Trading Method

The most popular type of trading style is the Technical Method. Traders of this type often use various types of indicator tools to guide them on their analysis regarding about the future direction of the forex market.

The most basic tool of a Technical Trader are the three different types of charts which are the Line, Bar, and Candle Stick. The Line Chart is the simplest chart among the three where the highest and the lowest prices are directly connected to form the lines.

The Bar Chart and the Candle Stick provides almost the same data except on their appearance. Please refer on the image posted below regarding about how they look like.

Most Technical Traders prefer to use the Candle Stick type of chart because it provides all of the necessary data such as the High, Low and Close price. It also has the best figure that clearly illustrates the behavior of the market’s volatility.

Bar Chart can also indicate data as of with the Candle Stick and there are still some traders who prefer to use this chart on their trading analysis.

However, using these three different types of charts on your analysis will provide the best result. Further details about forex charts are the Time Frames. 

You can view the behavior or volatility of the market on a closer look by adjusting the Time Frame of your trading platform. 

The most commonly used are the 1, 5, 15, minutes, 1, 4, hours, weeks and months.

Starting from the 1 minute to 1 hour period, these are used by the traders known as “Scalpers”. 

They open their trades for just a short period of time and when they managed to gain a small amount of profit they will immediately close that position. 

This for of trading style is very risky that only professionals can successfully use.

The 4 hours to 1 day Time Frame are used by the Day Traders. They only open a position once for every given period of a single day. This form of trading style is the most suggested method to adapt especially to all beginners because less risk is involve.

The longest period starts from 1 week to months. Other FX Brokers even provide years. This chart period are often used by Long-Term Traders. 

Their trading style works by letting their position run for a long period of time until they manage to achieve their target profit.

Line Chart

Moreover, Technical Trader’s analysis are solely based on the past historic data of the market prices. They believe that the previous price action of the market will repeat itself. 

This can be proven by studying chart patterns where it’s the best method for Newbies to start learning their first strategy.

Forex Trading Training Introduction

Over the long period of years, many professional traders have contributed their efforts in trying to research and develop several profitable trading strategies. 

Their method perfectly works for them but there is no guarantee that it will also work for you. Searching the internet will provide you with various types of trading systems. 

Most of them are based on a technical analysis where it involves the use of indicator tools. The accuracy of these trading systems varies between 30 to 70 percent.

Understanding the behavior of the forex market through the chart can minimize the risk of losing a trade. 

By using charts along with the Candle Stick Pattern and technical indicators, there is a higher accuracy of predicting the trend direction of the market.

You have to know that there is no strategy that will always successfully work on every time that it shows a positive signal. 

If such trading system exists then that’s probably the Holy Grail that everybody is trying to look for.

There are two types of technical tools which are the Lagging and Leading indicators. 

Most tools that are available on most trading platforms are the lagging indicators where it simply shows the previous data of the price action in another form. 

The leading indicators can provide you a future prediction of the market’s trend direction and a good example of this type of tools is the Candle Stick Pattern.

They say that trading the forex market involves 20 percent technical and the rest 80 percent are purely psychological. 

Your emotions do play the most important part when trading because it can affect your decision to be changed. 

The only method to overcome the psychological side of trading is to understand how the market behaves and to have a good Money Management skill. 

It’s too sad to say that this part can never be taught but only gained through hard work and experience.

The aim of this “Forex Trading Training Strategy” blog is to provide basic tutorial guide and to share you some of my trading experiences and knowledge in the hope that it can lead you into your own success.

Candlestick Chart

Moreover, the best part to start your lesson is to learn about Candle Sticks. 

Many traders prefer to use this Candle Stick chart over the conventional bars because they are easier to read and provide more information on the future direction of the market trend. 

Combining the Candle Stick chart pattern with the western analysis will add higher probability on predicting the future price movement.

News Trading Method

The market news can greatly affect the trend of Forex. Some of these news events do not provide much impact. 

It takes a long period of time on studies and experience before you can distinguish the effects of such news events that can cause a stir on the Forex market’s volatility.

News trading method is a strategy where traders often place their order before the exact time that the news event will occur. 

The type of order to be opened can be long, short or both. Through practice and experience, you can speculate the impact of the event on how the market will react.

To check for future news events, you have to visit a website offering a Fundamental Calendar. You can easily find them by searching the keyword “Forex Economic or Fundamental Calendar”. 

One of the most popular sites that offer this kind of services on the web is the Forex Factory. This is also a good place to participate on several interesting discussion and interact with the other members.

The Economic or Fundamental Calendar contains all future news events and it is the primary tool of the news trader. 

The date and exact time period of release are indicated on the calendar along with some details about the event.

Take note that some news doesn’t have enough impact that can influence the market to move. 

Opening a trade on this condition is a total waste of time and money for paying the spread of your broker. Anyway, this can be avoided by gaining more knowledge and experience.

There are two types of being a Forex trader which are the Technical and Fundamental. A technical trader doesn’t rely on any news events where their analyses are purely based on their charts. 

They are using various types of indicator tools analyzing the previous historic data of the market price because they believe that the “Market repeats itself”.

The Fundamental type of trader believes that the market is moved by events as what I have already explained on the first few paragraphs. They objective is to speculate the behavior of the market and open their trading position just before the news are to be released.

Choosing the type of trading style among the two could be difficult on your part. The best way to define the most suitable method for you is to try them and see if you can adopt.

Who say’s that you can do both of the method mentioned above?

Most successful professional traders are combing both technical and fundamental analysis and they claim to have the best performance on their trades. 

The strategy might be complicated enough for a certain newbie to be able to understand but all that requires is the effort to learn and gain the necessary experience.

Moreover, if you are a newbie trader then it is highly advisable not to trade by starting with a huge amount of capital because there is a very high risk that you will end up losing all of that investment. 

If you have nothing yet to invest or you just can’t afford to lose any money then you can create a virtual or demo account. 

Every Forex broker are now offering such account to let you experience how the market behaves and to familiarize yourself with their own trading platform.

Support and Resistance Levels

Understanding this topic requires that you are already familiar with the three different types of charts which are the line, bar and candle sticks. 

Any of these charts can be used to determine the area or levels of the support and resistance.

If you are a newbie then I suggest using the line chart because it is a lot easier to plot and determine the levels. 

Now, to layout the area of support and resistance on your chart you have to define the part where the prices often bounces or reverses back on the opposite direction. 

When this occurs on the high prices then this level is called the resistance. Low prices formed at the bottom are the support level.

The lines that you have formed will act as your basis on deciding your target profit or stop loss. Your target profit is best placed before the support and resistance of the current market trend. 

The stop loss should be placed after.

What causes the resistance and support levels to be formed?

These levels or price areas are when the currency being traded on the market has been sold or overbought. This means that the number of sellers or buyers has exceeded the opposing side. 

When the trend of the market is continuously moving on the downward direction and the condition of the currency is already oversold then there’s a very high probability that the trend direction will go bullish. 

If the market is trending on an upward direction then suddenly you have found out that it is nearly overbought, chances is that the trend will go bearish.

There are several indicator tools that you can use to determine whether the currency that you trade are nearly overbought or oversold. 

One of this tools that I often use is the RSI. When the currency price is above the 50 level then the condition is overbought. Below the level signifies the oversold condition.

Support and Resistance Line

Combining the method of plotting the support and resistance lines on your preferred type of chart along with your overbought and oversold analysis will provide a high probability of acquiring a profitable trade. 

Support Levels

Support levels are levels where the price of a currency pair tends to stop falling and starts to move up again. 

These levels represent a price point where there is enough demand for the currency pair to prevent the price from falling further. 

There are different types of support levels, including historical, psychological, and trendline support levels.

Historical support levels are price points where the currency pair has previously bounced off before moving up. 

These levels are significant because traders expect the price to bounce off them again. The more times a price level has acted as support in the past, the stronger it is considered to be.

Psychological support levels are price levels that are significant because they represent a round number. 

For example, if the EUR/USD currency pair is trading at 1.2000, the level of 1.2000 may act as psychological support because traders may expect the price to bounce off this level.

Trendline support levels are levels that are formed by drawing a line connecting the lows of the price. These levels are significant because they represent the trend of the price movement. 

If the price moves up and touches the trendline, it may act as support and bounce off it.

Identifying support levels is important because they can provide traders with an indication of when to enter a trade. 

If the price of a currency pair is approaching a support level, traders may expect the price to bounce off that level, providing an opportunity to enter a long position. 

In addition, support levels can also be used to set stop-loss orders, helping to manage risk.

Examples of support levels in forex charts include the 1.2000 level in the EUR/USD currency pair and the trendline support level in the USD/JPY currency pair.

Resistance Levels

Resistance levels are levels where the price of a currency pair tends to stop rising and starts to move down again. 

These levels represent a price point where there is enough supply for the currency pair to prevent the price from rising further. 

There are different types of resistance levels, including historical, psychological, and trendline resistance levels.

Historical resistance levels are price points where the currency pair has previously bounced off before moving down. These levels are significant because traders expect the price to bounce off them again. 

The more times a price level has acted as resistance in the past, the stronger it is considered to be.

Psychological resistance levels are price levels that are significant because they represent a round number. 

For example, if the EUR/USD currency pair is trading at 1.2000, the level of 1.2100 may act as psychological resistance because traders may expect the price to bounce off this level.

Trendline resistance levels are levels that are formed by drawing a line connecting the highs of the price. These levels are significant because they represent the trend of the price movement. 

If the price moves down and touches the trendline, it may act as resistance and bounce off it.

Identifying resistance levels is important because they can provide traders with an indication of when to exit a trade or enter a short position. 

If the price of a currency pair is approaching a resistance level, traders may expect the price to bounce off that level, providing an opportunity to exit a long position or enter a short position. 

In addition, resistance levels can also be used to set take-profit orders, helping to manage risk.

Examples of resistance levels in forex charts include the 1.2100 level in the EUR/USD currency pair and the trendline resistance level in the USD/JPY currency pair.

Trading Strategies using Support and Resistance Levels

There are several trading strategies that use support and resistance levels. These strategies include breakout trading, bounce trading, and range trading.

Breakout trading involves waiting for the price to break through a support or resistance level. 

When the price breaks through the level, it is an indication that there is a shift in the supply and demand dynamics. Traders can enter a long or short position depending on the direction of the breakout.

Bounce trading involves buying or selling the currency pair when the price bounces off a support or resistance level. 

Traders can enter a long position when the price bounces off a support level or a short position when the price bounces off a resistance level. 

This strategy works well when the price is in a range-bound market.

Range trading involves buying the currency pair when the price is near the support level and selling the currency pair when the price is near the resistance level. 

Traders can profit from the price movement between the support and resistance levels. This strategy works well when the price is moving in a sideways or range-bound market.

In addition to these strategies, support and resistance levels can also be used to manage risk. Traders can set stop-loss orders below the support level to limit their losses if the price falls below the support level. 

Traders can also set take-profit orders above the resistance level to lock in profits if the price reaches the resistance level.

Examples of trading strategies using support and resistance levels include buying the EUR/USD currency pair when it bounces off the 1.2000 support level and selling the currency pair when it reaches the 1.2100 resistance level. 

Traders can also use the 200-day moving average as a support level and the 50-day moving average as a resistance level.

Common Mistakes to Avoid

There are several common mistakes that traders make when using support and resistance levels. 

These mistakes include over-reliance on support and resistance levels, failure to adjust support and resistance levels as market conditions change, and ignoring other important technical and fundamental indicators.

Over-reliance on support and resistance levels can lead to missed opportunities and losses. 

Traders should use support and resistance levels in conjunction with other technical and fundamental indicators to make informed trading decisions.

Failure to adjust support and resistance levels as market conditions change can also lead to missed opportunities and losses. 

Traders should adjust their support and resistance levels as market conditions change to reflect the current supply and demand dynamics.

Ignoring other important technical and fundamental indicators can also lead to missed opportunities and losses. 

Traders should use a combination of technical and fundamental indicators to make informed trading decisions.

Final Words

Forex support and resistance lines are important concepts in forex trading. 

Support levels represent a price point where there is enough demand for the currency pair to prevent the price from falling further, while resistance levels represent a price point where there is enough supply for the currency pair to prevent the price from rising further. 

Identifying these levels is important because they can provide traders with an indication of when to enter or exit a trade. 

Traders can also use support and resistance levels to manage risk. 

However, traders should avoid common mistakes such as over-reliance on support and resistance levels, failure to adjust support and resistance levels as market conditions change, and ignoring other important technical and fundamental indicators. 

By understanding support and resistance levels and using them in conjunction with other indicators, traders can make informed trading decisions and increase their chances of success in the forex market.

Subscribing to Forex Signal Safe

Making money through trading the forex market is not an easy thing to do where there are high risks involve that you can almost lose your account. 

According to the latest survey, there are around 95 percent who losses their account on trading the market. 

It’s for this reason that there are several services out there that you can subscribe to help you out on your trades.

Choosing a good forex services that offers you a high probability of profitable result can be easily found by conducting researches from the forums, social media and any other means of interaction. 

Moreover, I happen to came across Forex Signal Safe where they are offering newbie traders to earn the same income as with their own professional traders.

Subscribing to Forex Signal Safe will provide you software allowing you to connect with their professional trader’s transaction where you can use them as your basis. 

You will also be guided by constantly receiving some email alerts.

Forex Signal-Safe

You will not be dealing with automated robots on this kind of services because you have to know that programmed machines can be very risky. 

Instead, you will be dealing or have an interaction with a real trader who is an expert on the field and aims to make money as well.

Forex Signal Safe is already running for years and they have several connections across the world. Among their professional trader is Jeff Alan where his trading style is plain and simple. 

A part of his method is that he likes to go into the direction basing on his candle stick pattern analysis together with the levels of support and resistance areas.

Another expert who is working on FSS is Viesturs Zellis of Latvia. 

He used to be a fund manager and an individual trader. His expertise is more about technical analysis, fundamental analysis and other trading methods that allow him to point the right direction of the market trend.

Investing on forex is not an easy thing to do where you have to treat it as a serious business that will require time and money. 

For some people, they don’t have the time to learn and educate themselves on this field but they simply wanted to invest and make their money grow. It is on this primary reason why such services exist.

The Importance of Using a Stop Loss

Predicting the direction of the forex market with one-hundred percent accuracy is impossible. Even professional traders claims that there is no perfect strategy that will always provide guaranteed results. 

Strategies that provide around sixty percent of accuracy and above are already profitable. 

Let’s consider for an example that you have a trading method with 70 percent of accuracy then that leaves you the remaining 30 percent the risk or danger of losing some of your investment. 

If you don’t have a proper money management method then you can lose a lot of money.

To prevent further loses, every forex broker platform have the function that allows you to place a stop loss. 

If your broker’s trading platform doesn’t have the option for you to setup your stop loss level then its time to look for a better broker. 

There are several forex brokers out there that you can easily join and they even provide some promising promotional bonuses upon registration but the most important part is their trading platform. 

Before creating an account, it is highly suggested that you should try their demo or virtual account for testing purposes. If you think that you are completely satisfied then go ahead and register for an account.

The most popular trading platform is the Meta trader 4 or more commonly known as the MT4. 

It contains almost all of the basic indicator tools by default and you can customize them they way you want it to be. 

One of the best parts on using an MT4 is the Expert Advisor function. This option allows you to run a programmed script that can perform automated trading for you.

Modifying Stop Loss

Moreover, forex is not a simple game where your emotions also do play an important role. 

It can affect your trades by deciding to adjust your current trade’s Take-Profit or Stop Loss thinking that you can earn more or the trend will reverse back on the opposite direction. 

This action can result into a huge loss leading into an early retirement on your forex trading career. If you have a good strategy then always stick with its rules.

Importance of Risk Management

Before diving into the importance of using a stop loss order, it is crucial to understand the importance of risk management in forex trading. 

Forex trading involves a high degree of risk due to the volatility of currency exchange rates. 

It is therefore important for traders to implement risk management techniques in order to minimize potential losses and preserve capital. 

Risk management techniques can include the use of stop loss orders, position sizing, diversification, and more.

Purpose of Stop Loss Orders

A stop loss order is a risk management tool used by traders to limit their potential losses. 

A stop loss order is an instruction to the broker to automatically sell or buy a currency pair once it reaches a specific price point, known as the stop loss level. 

The stop loss level is set by the trader and is typically based on a percentage of their trading account balance or based on technical analysis of the market.

What is a Stop Loss Order

A. Definition of a Stop Loss

A stop loss is an order placed with a broker to automatically sell or buy a currency pair once it reaches a specified price level. 

The purpose of a stop loss is to limit potential losses by closing out a position once it reaches a predetermined level.

B. How Stop Loss Works in Forex Trading

In forex trading, a stop loss order is typically placed with a broker when a trader enters a new position. The stop loss order is attached to the position and remains active until the position is closed out. 

If the market moves against the trader and the price reaches the stop loss level, the stop loss order is triggered and the position is closed out automatically.

C. Types of Stop Loss Orders

There are several types of stop loss orders that traders can use, including fixed stop loss, trailing stop loss, and guaranteed stop loss.

1. Fixed Stop Loss

A fixed stop loss is the most common type of stop loss order used in forex trading. It is a predetermined price level set by the trader when entering a position. 

Once the market reaches the predetermined price level, the stop loss order is triggered and the position is closed out.

2. Trailing Stop Loss

A trailing stop loss is a type of stop loss order that is based on the price movement of the currency pair. 

It is used to protect profits by automatically adjusting the stop loss level as the price of the currency pair moves in favor of the trader. 

If the market moves against the trader, the stop loss level remains fixed and the position is closed out once the stop loss level is reached.

3. Guaranteed Stop Loss

A guaranteed stop loss is a type of stop loss order that is guaranteed to be executed at the specified price level, regardless of market volatility or liquidity. 

It is a premium service offered by some brokers and is typically more expensive than a regular stop loss order.

Advantages of Using a Stop Loss Order

A. Helps to Limit Potential Losses

The main advantage of using a stop loss order is that it helps to limit potential losses. 

By setting a predetermined stop loss level, traders can control the amount of risk they are willing to take on each trade. 

This can help to prevent large losses that could have a significant impact on their trading account balance.

B. Allows Traders to Set Predefined Risk Levels

Another advantage of using a stop loss order is that it allows traders to set predefined risk levels. 

This means that traders can set a specific percentage of their trading account balance as the maximum amount they are willing to risk on each trade. 

This can help to ensure that traders do not take on too much risk and blow their trading account.

C. Provides Peace of Mind and Reduces Emotional Trading

Using a stop loss order can also provide traders with peace of mind and reduce emotional trading. 

By setting a predetermined stop loss level, traders can feel more confident and less emotional about their trades. 

They can also avoid the temptation to hold onto losing trades in the hope that the market will turn around, which can lead to even bigger losses.

Disadvantages of Not Using a Stop Loss Order

A. Risk of Significant Losses

One of the main disadvantages of not using a stop loss order is the risk of significant losses. 

Without a stop loss order, traders may hold onto losing positions for too long, hoping that the market will turn around. This can lead to even bigger losses if the market continues to move against them.

B. Lack of Control Over Potential Losses

Another disadvantage of not using a stop loss order is the lack of control over potential losses. Without a stop loss order, traders may not have a plan in place for limiting their losses. 

This can lead to emotional decision-making and impulsive trading, which can result in significant losses.

C. Emotional Trading and Decision Making

Not using a stop loss order can also lead to emotional trading and decision making. Without a stop loss order, traders may hold onto losing positions for too long, hoping that the market will turn around. 

This can lead to emotional decision-making and impulsive trading, which can result in significant losses.

Importance of Using a Stop Loss in Forex Trading

A. Limits Risk Exposure

The most important reason for using a stop loss order in forex trading is to limit risk exposure. 

By setting a predetermined stop loss level, traders can control the amount of risk they are willing to take on each trade. 

This can help to prevent large losses that could have a significant impact on their trading account balance.

B. Helps Traders Stay Disciplined

Using a stop loss order can also help traders stay disciplined. By setting a predetermined stop loss level, traders can avoid emotional decision-making and impulsive trading. 

This can help to ensure that traders stick to their trading plan and avoid making costly mistakes.

C. Improves Trading Strategies

Finally, using a stop loss order can help traders improve their trading strategies. By analyzing their trades and adjusting their stop loss levels, traders can identify trends and patterns in the market. 

This can help them to make more informed trading decisions and improve their overall trading performance.

Tips for Setting Effective Stop Loss Orders

A. Determining Risk Tolerance

Before setting a stop loss order, traders should determine their risk tolerance. This will help them to determine the appropriate stop loss level for each trade. 

Traders should consider their trading account balance, their trading goals, and their overall risk tolerance when setting their stop loss levels.

B. Identifying Key Support and Resistance Levels

Traders should also identify key support and resistance levels when setting their stop loss levels. 

Support and resistance levels are areas on the chart where the price of the currency pair is likely to bounce or reverse. 

By setting their stop loss levels just below key support or resistance levels, traders can help to ensure that their positions are closed out before the market turns against them.

C. Utilizing Technical Analysis

Finally, traders should utilize technical analysis when setting their stop loss levels. Technical analysis involves analyzing charts and indicators to identify trends and patterns in the market. 

By using technical analysis, traders can identify key levels of support and resistance, as well as potential entry and exit points. 

This can help traders to set more effective stop loss levels and make more informed trading decisions.

Final Words

In conclusion, using a stop loss order is a critical aspect of forex trading. It allows traders to limit their risk exposure, set predefined risk levels, and stay disciplined in their trading. 

Not using a stop loss order can lead to significant losses, emotional decision-making, and impulsive trading. 

By setting effective stop loss levels, traders can improve their overall trading performance and increase their chances of success in the forex market.