July
Forex Strategy Trading Tips: How to Develop The Patience Necessary For Effective Forex Trading
There is an old Chinese saying that says “Good things take time” and highly profitable investments do too. As a Forex trader I have learned that the more patient you are the more money you make from your trades.
Forex strategy trading is all about making smart decisions at the right time. In this article I would like you discuss how you can develop the required amount of patience for profitable Forex trading.
It is not about quantity but the quality of your trades: It is incredible how many people out there believe that by taking more trades they will make more money. I have actually found the opposite to be true. A lot of people will disagree with me on this but that’s ok.
I strongly believe that the more trades you take the more times you expose your account to risk and the more room you have to commit mistakes. In average I take about only 5-10 trades per month and I focus on higher time frames.
Why? Because the big money is in the higher time frames. All the hedge fund managers, money managers, and institutional trades are looking at them. As a result more money can be made in a daily or 4 hour chart than in a 5 minute one.
I find it very interesting how many of my fellow traders who trade lower time frames make less or the same profits I make but with about 5 times more work from their part. Successful Forex trading can only be achieved through working smarter not harder.
Focus on the process not on the profits: I have always believed that if you focus on how much money you are going to make you will not focus on trading profitably and making smart decisions.
The other day I was reading one of my favorite books called “Market Wizards” by Jack Schwager and one of the traders he interviewed for his book said something that had a very strong impact on the way I see Forex trading.
The name of this trader is Paul Tudor Jones. He is a legendary futures trader and he once said “everything gets destroyed a hundred times faster than it is built up. It takes one day to tear down something that might have taken 10 years to build”
This is absolutely true for Forex trading. If you don’t know what you are doing and your risk management is off you could blow up your trading capital (that maybe took you years to save) in a matter of hours. This is why every trader needs to focus on the process instead of focusing on profits. Remember that playing a strong defense will be more effective than playing a strong offense.
A successful trading strategy plus patience and discipline is all you need to succeed: Most FX traders have a hard time focusing on one strategy and because of that they lose more money than they make.
Many of my friends and trading partners come to visit me to my office because they want to see how I trade and most of them are totally puzzled after a couple of days. They expect to see me trading all day, working hard at it, and always looking at my charts.
Instead of that they are shocked when they realize that I only place about 1-3 trades per week and manage them as the days go by. Then the rest of my week, I am working out, going out to eat, spending time with my family, or on vacation.
The reason why I am able to do this is because I have focused all of my energy on becoming more efficient and trading smarter, not harder.
You can do this too by focusing on higher time frames, taking fewer trades, and focusing on the process instead of the profits. Stay tuned as we will publishing more Forex strategy trading tips very soon.
Best regards,
Jay Molina
Pro Forex Trader & Educator
June
Currency Trading Tips: 2 Reasons Why Forex Trading Can Help You Achieve Financial Freedom
Over the last few years many so called “financial gurus” have been sharing thousands of ways to achieve financial freedom. An important thing to remember is that many of these people you hear about are unique cases and many times what work for them might not work for you.
In this section of my currency trading tips series I would like to share with you 2 reasons why I believe Forex can create a lot of “unique” success stories and can help you to achieve true financial freedom.
Forex beats the principle that says “that the more you work, the more you earn”: For decades we have been taught that we go to school, graduate in something we like, get a job, have a family, and are happy forever… right.
The rules of the game have changed and as our economy goes into a deeper crisis we need to take action and take our financial future into our own hands. Forex trading has changed my life in ways that I didn’t even know were possible and I truly believe it can change yours.
In the past we have been told that if we want to achieve something we need to work hard at it and we will succeed. This is not always true. Currency trading needs to be taken seriously and to become profitable you need to learn how to work smarter instead of harder.
As a matter of fact I have discovered that the less I trade (because I only take high probability trades) the more money I make.
I also know many other traders who work on their trading at least 2-3 times as hard as I do and don’t make half the returns I make. Why is that? Because they are chasing their own tail! Overtrading and impulsive trading are the main causes why most people never succeed as FX traders.
Remember; make sure you always work smart instead of hard.
Forex can give you the time freedom no other one investment can: Most people who invest stick to the traditional investment vehicles such as mutual funds, stocks, bonds, or real estate. These are good investments if you are ok with only making a ROI of 3%, 5%, or 7 %( if you are lucky) per year. However, if you want to make some serious profits the Forex market is what you should be investing money in.
Trading the Forex can allow you to make enough money to pay your debt off, go on a vacation, put a down payment on a house, and much more.
As a foreign exchange trader you can trade from anywhere in the world and at anytime you want. In the last few years I have traded from several vacation destinations and countries.
In addition, many times I am able to spend time with my family at anytime I want. How many people do you know that can take their family to the beach on a Tuesday afternoon? Not many.
This is the type of time freedom the FX market can give you. When you create a steady income stream from Forex trading you will be able to trade whenever you want and from where ever you want.
I hope you enjoyed this part of my currency trading tips and don’t forget to come back soon as I useful articles very week.
Best regards,
Jay Molina
Pro Forex Trader & Educator
June
Forex Strategy Trading Tips:
How to Use Forex News to Trade the Markets
Fundamental analysis is the study of how the global events and news affect the currency markets. In this edition of my Forex strategy trading tips I will be teaching you how I you can use fundamental indicators to help you take better trading decisions.
The use of fundamental analysis in the Foreign Exchange Market is done by using economic indicators. These fundamental indicators provide you with economical factors of a country that can help you to measure the strength of a country’s currency.
Economic indicators are available through several sectors of a country’s government and private companies. This information is analyzed by Forex traders to forecast the direction of the currency markets. Forex economic indicators are released at determined times and dates, and are followed by most serious currency traders.
Since so many investors are looking at them, Forex economic indicators have an enormous impact on the exchange rates of the currencies that are traded in the foreign exchange market.
The majority of FX traders do not use fundamental analysis because economic indicators seem difficult to them. However, using fundamental analysis and following economic indicators can be a whole lot easier when you follow simple guides that will keep you updated with the Forex economic indicators easily.
How to Start Using Forex Economic Indicators
It is important to keep a log of all the important Forex economic indicators’ release dates. Keep a log or subscribe to one of the economic journal services that are available online.
In addition, you should use and follow economic indicators that are relevant to the currencies you trade. Each currency belongs to a different country and as a result the economic indicators will be different for each currency. You will also need to learn what each indicator means and how it will affect a currency’s strength.
The main principle behind Forex fundamental analysis is that if a country’s economy is doing well its currency will go up in value and if the economy is doing bad then their currency will devaluate and its price will go down.
The Most Important Fundamental Forex Indicators
As I mentioned before each currency will have different economic indicators and the date and time when they are released are different. It is now time to talk about the most popular fundamental indicators that every Forex trader should pay attention to.
The Treasury International Capital: The treasury international capital or TIC tracks the flow of treasury and agency securities. The basic principle behind this indicator is that a high reading is positive (or bullish) for the USD, while a low reading is negative (or bearish).
Durable goods: This is released monthly by the Bureau of Census and reflects new orders placed with domestic manufacturers for delivery in a near future. The basic principle behind this indicator is that a high reading is positive (or bullish) for the USD, while a low reading is negative or bearish.
Consumer Price Index (CPI) Ex Food & Energy: This indicator measures and analysis the weighted average of prices of consumer goods and services such as transportation, food, and medical care. This indicator is used to measure the level of inflation of a country. The basic principle behind this indicator is that a high reading is seen as positive (or bullish) for the USD, while a low reading is seen as negative (or Bearish).
There are several other Economic indicators that can be used to analyze the Forex market and you should spend some time analyzing the ones that affect the currency pairs you trade. I hope I was able to provide you with useful information in this section of my Forex strategy trading tips.
Best regards,
Jay Molina
Pro Forex Trader & Educator
June
Currency Trading Tips: How to Pay Off Your Debt Through Forex Trading
If you are suffering under the burden of debt, then it is time that you consider the various ways how you can pay off debt. It is always feasible for you to make regular monthly payments towards paying off your debts if your income increases. You can consider various sources for increasing your income. One of the best ways to earn money, even when you are in debt is investing in Forex market. The Forex market is a market of foreign currency exchange; here you can trade in a pair of currencies. You can trade a single type of currency with another currency when the price of the previous one is low. However, you can trade this currency back when its price rises. Thus you end up making a profit.
Why should you invest in Forex market?
There are various reasons why investing in Forex market can be a good way to earn income and pay off debts. These reasons are listed below.
1. You can start with a small amount - When you are in debt then it is quite likely that you don’t have finances in hand that is required to start investing. The good thing about forex market is that you can start trading here with a small amount of money in hand and make profits out of it. This feature of the Forex market makes it a better place to invest as compared to other ventures where you would need a considerably more amount of money to start and make profits.
2. You can invest at all times – Forex market is a global market hence it is open 24 hours a day. Thus you can invest and work on the market whenever you feel like. When you have a regular job it is not possible for you to compromise on the job timings. Thus if you are investing in Forex market, you can invest after your work hours.
3. You can invest from anywhere – It is possible to invest in Forex market online, hence there is the flexibility that you can invest from anywhere. The only thing required is a computer with internet connection. Thus you can make investments even if you are at work or out for vacation.
4. You can trade with a demo account – The Forex market gives you the provision of creating a demo account and trade with play money to check your investment strategies. Since the Forex market has a high leverage rate you can make huge profits but also at the same time there is chance of suffering losses. Thus you can practice enough before you venture forth into real time investment.
Thus you can see how the Forex market is advantageous for you to invest and pay off debt. However, you should be careful as the risk of suffering losses is also quite high.
To your trading success,
Nancy Smith
Professional Financial Writer
June
Forex Strategy Trading Tips: The Forex Trading Checklist Every Trader Should Use.
As I was preparing to trade the markets today I followed my typical pre-trading routine. I follow exactly the same routine everyday and it helps me to become more organized and efficient as a trader and as a businessman.
As part of my Forex strategy trading tips I would like to share with you a checklist that every FX trader should use in order to become more profitable, more organized, and increase his or her return on investment.
Check your open trades and track their performance: This should be the first step you take once you get to your computer. Check all of your open positions and track their performance.
In many occasions stop losses need to be moved to break even or you want to take profit early because of an incoming event (such as non- farm payroll). One of my mentors once told me that “everything that matters should be measured”, this definitely applies to FX trading.
Analyze the market before you place any new trades: I cannot emphasize enough that you need to analyze the market before you open any trades. When you are in a trade you are not the same. You are thinking about the trade all the time and you are more likely to make non-sense decisions.
Furthermore, you will be hitting your head if you see something in the market that creates a conflict with a trade you already took.
Read the news or read a news calendar: I am more of a technical trader than a fundamental trader; nevertheless, I still try to stay up to date in what is going on around the world.
One of the tools that I use to analyze the fundamentals of the Forex market is the news calendar. A news calendar provides you with a list of all the important events that are happening in the global economy. Many of them also tell you the expected influence that each specific news event will have on the currency markets.
Check your risk, stop loss, and tale profit parameters: small things can make a big difference in Forex trading and small mistakes can cause large losses. This is the reason why I always check my risk, take profit levels, and stop loss levels. That’s the only way for me to ensure that everything is working fine and that I am going to meet my trading goals.
Never let a small mistake become a large loss: I decided to include this one as part of the Forex trading checklist because I have seen many traders lose money this way. We are all human and we will commit mistakes from time to time.
One of the most common mistakes traders make is taking a trade by mistake. I have done it and all professional Forex traders have. This is not that big of a mistake unless you let run and become a larger loss. My advice to you is that if you ever take a trade mistakenly close it immediately, never let a small mistake turn into a big and unnecessary loss!
I Hope you enjoyed my Forex strategy trading tips please check back frequently as we post multiple times per week.
Best regards,
Jay Molina
Pro Forex Trader & Educator
June
Forex Currency Trading Software:How to Find the Best Trading System For You
The Forex industry is full of gimmicks and so called Forex “gurus” who don’t even trade themselves! For this reason many traders are misled and have a really hard time finding the best Forex currency trading software.
In this article I would like to share with you a list of useful tips on how to find the best Forex currency trading software for you.
Always back test a new trading strategy: Manual backtesting is far more effective than automated backtesting. The reason why I say this is because when you manually back test a strategy you learn the strategy more deeply and you become one with the strategy.
In addition, you will also be able to spot mistakes and weaknesses within the system that automated testing software cannot detect.
Do you homework before you put that credit card out! : This is an important step. Before you purchase any trading system you need to make sure you do your homework and shop around for other trading systems.
Be very careful with the really cheap trading system because as they say “You get what you pay for”, normally the $97 trading robot will not do anything but lose you money.
When you decide to purchase a trading system make sure to get in touch with the seller as soon as you buy it. This way they will notice that a new customers just joined. This will make their customer service make up and stand by in case you have any questions.
Get to know the person behind the Forex currency trading software you intent to buy: Whenever I buy a product I always want to know more about the company or the creator of the product. Simply because I want to know the level of expertise of the creator or creators.
Reliable customer support is vital: I have noticed that several Forex products do not provide you with any after sale customer support. Having access to support is critical and if someone doesn’t offer you reliable customer support take your business elsewhere.
Develop yourself and make the system work for you: Anyone can buy a trading system, but that doesn’t mean that the trading system is going to work for them.
Why? Because having a successful trading system is only a part of the equation for Forex trading success. Becoming a profitable trader requires you to develop your trading skills and make the system work for you.
The only way to make a trading system work for you is by learning the strategy behind it. Blackbox trading systems are the easiest way to lose money. When you don’t know or understand the principles and rules behind a trading system is just like trading with your eyes closed!
Picking the best Forex currency trading software is not always easy. The Forex market is full of gimmicks, however; you still can find many honest professional trader to business trading strategies from. As a conclusion, only do business with Forex traders who not only talk the talk but that walk the walk.
To your trading success,
Jay Molina
Pro Forex Trader & Educator
June
5 Easy Tips On How to Use Free Forex Software To Make Up to 185% Return on Investment
In the last few month I have been developing several trading systems that are created by using a set of simple trading indicators. The best part of it is that some of them are very profitable and easy to use. The other day I back tested a set of free Forex software tools that have made a total of 185% in the last 12 months by trading only 1% per trade.
I actually found this trading strategy when I was testing several Forex indicators and trying to find good combinations of lagging and leading indicators. After testing about a hundred of them I was able to find a set of indicators that was actually making money.
In this article I will be explaining to you 4 easy tips on how you can also create effective trading systems that can be make 180% ROI and more per year.
Find a combination of indicators that makes sense: When you are looking for new trading systems you will need to look for indicators that work well with each other. For instance, I normally use a combination of lagging and leading indicators.
Why? Because I want to be able to take advantage of the early signals some indicators provide along with the confirmation signals indicators such as RSI can provide.
In addition, I always make sure that the signals I am receiving from my set of indicators are not too weak. The best way to measure the strength of a signal is by forward testing it (with a demo account, never with real money) and evaluate the way they perform.
Combine indicators that can measure the strength of the movement and another one that confirms the market’s intention: This is a very important part when you develop a trading system. If you only use indicators that measure the strength of the market it will be hard to determine when to enter the market. On the other hand, if you only use indicators that help you to determine the market’s intention (for example: the market is about to go in an uptrend or a downtrend.
Backtest the trading system for at least 12 months: Backtesting is the only way to confirm that your trading system actually works. Many strategy developers and traders commit the mistake to only back test a trading strategy for a few months or weeks.
This is a serious mistake because anyone who has been trading for a while knows that every trading system has good and bad months. In some months I have made as much as 50% ROI, in a bad month I have had a -7% or a -5%. If you only test your system for 2-3 months how do you know that you didn’t just catch the good months with your backtesting. Then, if the system is not as profitable as you thought, you will be confused and disoriented when it starts to lose you money. For this reason I suggest to back test a trading strategy for a minimum of 6 months (if you back test it for 1 full year is even better).
Create a set of money management and risk management rules for the system: Last but not least you need to create a set of money management techniques and strategies to go with your trading strategy. Also, it is very important that you apply your money management techniques while you are backtesting your free Forex software system.
Stay tuned as I post articles daily and you can always benefit from all the information we are giving out to the Forex community day after day.
Best regards,
Jay Molina
Pro Forex Trader & Educator
June
Forex Strategy Trading Tips: 4 Easy Ways to Discover Your Trading Personality.
Most Forex investors do not understand the fact that their personality will have a high impact on their trading career. Whether you are a discretionary trader who takes all his trades manually or you use automated Forex strategy trading systems, your personality will affect your trading success.
Understating how your unique personality can affect your profits can sometimes be pretty hard since most Forex courses, schools, and mentors don’t teach you how to do this. IN this edition of my Forex strategy trading tips I am going to teach you 4 ways to discover your trading personality.
Discover your risk tolerance and your risk limits: Every investor has a different risk tolerance. In my trading career I have come across traders who would not tolerate risk at all and they would prefer to have a money manager handle all of the trading.
On the other hand, I have met people who had a high risk tolerance and as a result traded 5% to 10% per trade (not what I would recommend.). Determining your risk tolerance will help you to understand the money management techniques you need to apply to your trading. Knowing your limits will allow you to never take irrational decisions because you are trading beyond your limits.
Find the appropriate trading style for you: Your trading style should be selected based on your personality. For instance, if you are a patient investor who can hold a position for a few days, then swing trading might be for you. Maybe you like a lot of excitement and fast paced trading, in this case you might want to look into scalping, and so on.
By selecting a trading style that helps you to create a balance between your trading career and your personality you will increase your chances to become a very profitable Forex trader.
Uncover your personal motivators: A motivator is the reason or reasons someone for acting or behaving in a particular way. It is also the reason why we do things and take action. In Forex, people normally have two motivators. First, some individuals are motivated by the monetary rewards they can receive from trading Forex. Second, some folks become motivated because of the self fulfillment they can get from trading the markets.
Finding your motivators will allow you to better plan your approach to the market. The best way to find your motivators is by asking yourself: “What motivates me to trade? Why do I want to be successful at trading?”
Define what will indicate that you are out of your comfort trading zone: You comfort trading zone is the moment when you feel totally in sync with the markets and you are able to trade the markets profitably, keep your emotions out of the picture, and make money at ease.
Defining how to measure if you are out of your comfort zone can help you to know when to go back to the basics and especially stop trading.
A few good examples of indicators that you are out of your comfort zone include: a certain amount of days without a winning trade, you find yourself taking irrational trades, or your stress levels from trading are abnormal.
Remember, learning how to successfully implement Forex strategy trading is a on going process and the more educated you became the better you will perform as a trader.
Best regards,
Jay Molina
Pro Forex Trader & Educator
Jay Molina is an advanced Forex trader that helps and teaches other Forex traders and investors around the world to learn about the Forex market and its rewards and risks.
