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Risk Assessment In The Forex Market

Risk management in the forex market is essential for you to survive in forex trading. You can use the best platform, book the best brokers, or employ the best trading system but still fail if you do not have the right risk management techniques. Know your limits, and determine how much risk you can take.

It is tempting to risk high and win big but remember what the laws of probability teach us. It’s all too easy to follow our emotions and following one’s emotions in trading could mean higher risks for you.

Forex Trading Chart

Controlling losses is essential to successful FX trading. You should know your hard and mental stops. Hard spot is your designated stop loss. Mental stop is essential if you want to play it out and keep your stop loss from moving. But this could be dangerous because you could be prone to moving your stop loss farther and farther. This whole process is called forex trading setting up your stop loss order.

Choose your lot size that you are comfortable with. At the beginning, use smaller lot sizes and be conservative as you can be. Stay away from dangers and play it safe first. With small trade lots, you can go ahead and trade more.

Avoiding overleveraging is another way to reduce your risks. It is far too easy to setup a margin account and trade in big bucks. But never forget that your losses have the potential to become bed. This trading works like a double edged sword to be careful not to get cut yourself.

By limiting your risk, you increase your chances of earning money, but lower down your chances of getting high earnings. It’s more like playing it safe. With less risks, there are fewer avenues for your money to go out, thus giving you more opportunity to trade.


Relevance of Tick in FOREX

What is Forex Tick?

Many people are questioning me the same thing like what FOREX tick is, and how does this little thing affects FOREX Trading. FOREX tick is not that blood sucker unlike those little bugs. FOREX tick is an event when the price of a currency pair changes from A to B.As soon as a new price is registered, a new tick also occurs.

FOREX market is discrete. A discrete price changes that drives it is what we know as FOREX tick. There’s a central computer in the system that combines all of the buy orders and all sell orders, and computes a new price based on the supply/demand rule. This computer makes FOREX ticks with price shifts, and these adjustments are propagated to all FOREX brokers all over the world.

When the price of USD goes down with a gap as you often see on FX live charts, that is mainly because everyone wants to sell USD, and only a few people want to buy it. By its character, FX market cannot be consistent. The next price of a currency pair can only be determined when you have combined all sellers and all buyers.

You could also find some Forex currency trading approaches that can be based upon FOREX ticks. Just like gap trading which is based on ticks. Numerous scalping strategies are based on ticks.

By checking the tick chart, it is possible to predict the following tick movement and create a several pips of profit every few minutes.

 


Forex Trading Online

The internet is indeed a gift of today’s advanced technology. It has changed the communication industry and now it is being used for different kinds of tasks. It seems that everything is possible through the internet. Before, the only way to trade in the Forex market is to be there physically. But now, you can trade even in your own home or in the office as long as there is an internet connection. If you think that only the intelligent individuals are involved Forex trading, you’re wrong because at present, average individuals can Read more…


FOREX Trading

A lot of individuals are interested to know more about FOREX trading. Do you want to know why? Well, Forex trading can help you earn lots of money as long as you have the right strategies and trading information. However, with one false move, you can also lose huge money. To be a successful trader, you need to be serious with all your trading transactions.

Exchanges in the Forex market happen instantaneously. Even the expert traders and bankers are challenged to make very good Read more…


Automated Forex Trading

Are you a disciplined individual? According to expert Forex traders, the only ones who succeed in the Forex market are those people who stay disciplined despite their success or failure. Automated Forex trading has changed the way traders make their transactions. If you’re a savvy Forex trader, you can definitely benefit from using these automated systems.

For beginners in the Forex trade, be warned that most of the trading systems sold or offered online are considered junk and useless. Oftentimes, these systems provide tested simulations and cleverly hyped marketing strategies that Read more…


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