Trend Following Currencies - How to Catch EVERY Big Move
By: Kelly Price
Trend following currencies can be a great way to make money - but seeing them on a forex chart in hindsight is easy - but trying to capture them in real time is a bit harder however it can be done - if you follow the simple tips enclosed. If you use these tips to catch currency trends, you will catch every big move and enjoy currency trading success so, let's look at them.
The first things you need to remember is to "forget buying low and selling high" and think "buy high and sell higher" - it's a fact that most big moves start from new market highs and NOT market lows. The other wisdom you must forget is predicting price movements - this is another word for hoping and guessing and that's not a way to make money in any venture let alone forex trading. The way to win is to act and execute trading signals on price breaks and use a breakout methodology.
Breakouts are used by all the world's top traders and you must learn to trade them to. So what is a breakout?
They are simply a break of resistance or support to make a new high or low respectively.
All breakouts are not the same and some are more valid than others. The way to find the ones which can yield big moves is to look for an area of support or resistance which has been tested several times and the more the better. Also look for several different time frames and the wider apart the better.
The more times a level has been tested the better - but look for at least 3 in two different time periods. When the level breaks, you execute your trading signal in the direction of the break. You should check that the velocity of price is accelerating in the direction of the break and for this you need to use some momentum indicators to confirm your trading signal. We don't have time to discuss them here, simply look them up in our other articles.
Once the breakout has occurred simply place your stop below the breakout point.
Sounds simple? It is - but most traders can't do it.
They want to hold on and wait for a better price to buy at but wait in vain as strong breakouts don't retrace and the trader not in watches the price sail over the horizon and he thinks of what might have been. If you do it you will be in on every major break and while it is simple the best forex trading strategies are but that doesn't mean there not profitable.
If you trade selectively and go with the valid breaks you will be in on every big move and be able to follow the big trends which yield the big moves. Keep in mind you don't get paid for effort or how often you trade in forex but for being right and that's it.
So learn to trade breakouts and you will have simple timeless strategy for big profits.
NEW! FREE FOREX BREAKOUT TRADING SYSTEM PDF For free 2 x trading Pdf's, with 50 of essential info and more on Breakout Forex Trading Systems visit our website at: http://www.learncurrencytradingonline.com
Read More......Why Not To Bottom Pick
By Shaun Rosenberg
Too many traders don't know why not to bottom pick. Not only that, some of these traders actually think bottom picking is a good idea. This is never the case.
It may be tempting to bottom pick. After all who wouldn't want to buy a stock when it is at its lowest and sell it when it gets to its highest. The whole buy low, sell high ordeal.
The problem with bottom picking is that it is extremely hard to tell when a stock will make a bottom. The majority of stocks that have been going down in the past will probably keep going down in the near future. That is why most professional traders tell you not to go against the trend. Any successful attempt to find the bottom was probably more luck than anything.
The other thing people will try to do is to get into a stock after a crash when it starts to rally. BIG MISTAKE! Falling stocks will typically rally every now and then right before they crash again. In fact successful traders will consider sell rallies during a bear's markets good practice.
What you might want to consider is not buying falling stocks but shorting falling stocks along with buying stocks that keep going up. This way you are not expecting the stock to do anything other then what it has been doing.
Also instead of picking the exact bottom it may be beneficial to wait for the stock to stabilize and form an uptrend again before buying. This may lose the investor the opportunity to get in when the prices are at their lowest but the benefits of profiting more often will outweigh the potential profit you may have missed out on.
For more information on trading the stock market visit http://www.stocks-simplified.com
Article Source: http://EzineArticles.com/?expert=Shaun_Rosenberg
Technical Analysis VS fundamental Analysis
by: Shaun Rosenberg
Technical Analysis VS Fundamental Analysis, which one is better. These are two different theories about how the market works and how to make money in them. Hard core Fundamentalist will tell you Technical Traders can not possible make money in the market. Hard core Technical traders will tell you Fundamental Analysis isn't worth the effort.
So, who is right? Let us take a look at both of these theories.
We will start with fundamental analysis. This involves looking at individual companies. You must look at a company's financial statement. You must also be aware of any news that comes from the company.
The whole theory behind this is if you find high quality companies and buy their stock it will eventually go up. After all if a company is a great company its stock should go up.
The problem with Fundamental Analysis is that it favors the large investors. Think about it, if you are investing billions of dollars in a company you can afford to spend millions to find information about that company. You can also talk directly to the CEO's of the companies that they are thinking about investing in. This gives large investors an unfair advantage.
Technical analysis however does not give anyone an advantage. It is all about chart patterns. The more you learn about chart patterns the better an investor you will become. And because it deals with chart patterns everyone who has a computer is on an equal playing field.
Now you may think chart patterns might not be able to help you, but you would be wrong. They have helped millions make money in the market. They also make sense.
If you see a stock bounce between $45 and $60 continuously and it is at $45 you would assume that it is going to go up. Why? Because it has always bounced off of $45 in the recent past. In fact every time it gets to $45 most people consider the stock undervalued and buy it. Also where do you think the stock will most likely go? $60,right?Why? Because it always has in its recent past.
There are hundreds of chart patterns out there that have been tested numerous times by numerous people to be true.
Most technical traders do not concern themselves with a company's fundamentals. This is because they don't really need to. Most of their trades could only last 1 or 2 months. Remember Fundamental Analysis can find strong stocks that may eventually go up in the long term. If you are only in a trade for 1 month it may not be worth looking into.
For more information about how to trade the stock market visit http://www.stocks-simplified.com
