Has anyone successfully used automated software in conjunction with forex trading?

May 14, 2011 by  
Filed under Questions

Being a complete computer nut, the idea of using a computer to evaluate current trends in real time and have it indicate the optimum buy and sell points, really makes sense to me.

If you have had any experiences with automated software in the forex or similar trading platforms your answer will be of great interest to me

How to pick tops and bottoms on forex market using technical analysis

September 7, 2010 by  
Filed under Forex Trading

A discussion of what to be aware of, when choosing a trend following strategy on forex market, or if you try to locate tops and bottoms. Technical analysis should be applied in conjunction with fundamentals no matter what. Do not try to pick tops and bottoms if you are not ready to let your profits run.
A favorite Forex trading saying is “the trend is your friend”. In other words, if you trade with the trend then you have more chances of selecting winning trades. The idea is logic in that you “go with the crowd”. However, a very popular forex trading strategy involves “picking bottoms and tops”. This trading method normally involves using a forex technical indicator to determine trend reversals. More specifically, traders are searching for positive signs that either a bull buying channel is about to top or that a bear selling channel is about to bottom. The idea of pursuing such a strategy seems obvious in that the sooner you can pinpoint such an event, the more profit you can make following the reversal. However, top and bottom picking does seem like a dangerous practice on the surface because you are about to pit your skills against the entire forex market which is moving in the opposite direction; this is often referred to a “trying to catch a falling knife” in the sense that you are likely to cut yourself.  
Most traders consider that a forex market trend is a predictable price response defined by bull buying or bear selling channels which can exist for some time. A new forex market trend is quite often born when the forex market price breaks through either a support or resistance level and reaches new lows or new highs respectively.  
When you attempt to detect the top or bottom of a trend you are embarking on a complex and quite dangerous exercise, since you are about to trade in the opposite direction of the market. However, many traders still attempt to master this technique because the rewards can be so great. In other words, many traders are prepared to accept the high risks associated with ‘picking tops and bottoms’ because of the tremendous rewards that are potentially available. The mental attraction is that if they can detect a top, for instance, then they can ride the selling channel down and so achieve a considerable profit.  
However, if you are going to accept such trades with a high level of risks then you must perform this strategy correctly. Obviously I am not talking about “risk” in the sense of money management, but more so, that the trend is more likely to continue than to reverse. This implies that you should apply appropriate money management. So when you attempt to locate a top or bottom, you will engage a large risk factor as you are about to trade against the entire market. Hence you must be skilled in detecting a possible reversal, and manage your risk: reward accordingly.  
As a result, fear often arises which can produce significant negative psychological effects that cause you to snatch at quick profits e. g. 50 to 100 pips after entering a trade once a possible top or bottom has been formed. The reason for this action is that knowing that you are swimming against the tide makes you fear that the market will suddenly reverse back towards its original direction. However, this is a bad trading practice, especially over the long haul, because you would be subjecting yourself to intense risk without letting your profits run when there is a good chance to ride the trade for a long time.
So, in order to be successful with this technique, you must commit yourself completely to its inherent concepts. As such, you must be prepared to steel yourself and let your profits run (risk free, if possible) until the channel shows signs of exhaustion. By doing this, your trading strategy will enjoy a good risk: reward ratio over the long haul which it would not do if you continuously snatched at small profits.  
You will soon realize that you can only develop profitable forex trading strategies through your own hard work which will undoubtedly include the study of other people’s forex experiences.  
 In a broad sense, the forex market tracks the stock market, which in turn, responds to global economic movements. When the Dow Jones Index rises, the EURO and GBP tend to rise whilst the USD and the YEN tend to fall. Conversely, when the Dow Jones Index falls, the USD and YEN rise whilst the EURO and GBP fall. As you undoubtedly know, the stock market tends to fall in response to “bad news” whilst it tends to rise on “good news”. Forex trading analysis is used in order to design forex trading systems and consists basically of two elements which are forex fundamental trading analysis and technical analysis. Ideally, both should be used in combination to grasp a better understanding of the forex market, and possible trades. Monitor the trade for possible reversals and exit points using both forex technical and fundamental analysis.  
In summary, forex technical analysis involves examining currency prices over a period of time to try and identify forex trends and their potential reversals by detecting tops and bottoms. For example, if the value of a particular currency has been steadily increasing over a period of several weeks, then it is likely that the trend will continue in the future, at least for the short term. If you can correctly identify a trend, and trade in the same direction you are likely to make profitable trades. Also, the earlier you can identify a trend‘s reversal, the more chance you have of making larger profits.  

In order to obtain more data, support and solutions of the signal please go to the currency supplier of the signal and to demand its signals free forex

Identifying the Right Stock Option Trading System

July 31, 2010 by  
Filed under Option Trading

If you are a chess player you already know the value of a good set of workable strategies. You are already also aware of the fact that there is no single strategy that can see you through all challenges. This same theory applies to the world of finance too, and no one can turn to the same techniques or systems over and over again in order to yield the same results. For example, there is no such thing as a “one size” stock option trading system that can be used on a regular basis. While there are a wide array of strategies that should be put to work for a particular issue or market trend, there is not a single route or path that leads to success. What has to happen before a good stock option trading system can be followed, however, is that the investor (in conjunction with their broker) must identify their overall goals, the amount of risk they are willing to take, and the amount of money they want to dedicate to the purchase of premiums and trades. Clearly, the most common activities in any stock option trading system or plan will be the buying and selling of options. The major differences will be whether you are working with “call” or “put” options, and what the reasoning is for the transaction. For example, the investor’s goal may be simply to hedge losses. In such a case, the investor will often purchase a put option as a means of insuring their original purchase price on a stock or commodity. This will guarantee them a specific selling price, but it doesn’t force them to actually sell off the particular issue should it enter into a bullish period or phase. In such a case they would have risked only the price of the premium. As just demonstrated, this sort of approach indicates that an investor’s best system is the one that is designed to meet both short and long term goals. Not all investment plans will involve options trading, but those that do will usually have very clear cut goals or reasons for including such activities. For example, all investors know that they must remain actively aware of overall market conditions as well as the values of their primary holdings. This means that they must have some plans in place for times when the markets are “bullish” or on the rise, “bearish” or declining, and even when they are neutral. A good plan or system is put in place to create income whenever possible, but to also guarantee against risk and loss too.

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