Forex Trading Canada Tax – Learning All About Forex Charts Before You Start Trading

August 31, 2010 by  
Filed under Forex Trading

Forex Trading Canada Tax
Forex Charts are based on the forex market action involving price. Charts are a major tool in forex trading. There are many kinds of charts, each will help to visually analyze the forex market conditions, assess and create better forecasting, and identify forex market patterns and behavior. Forex Trading Canada Tax
Forex charts and spreads weigh heavily on the return on your trading strategy (this can have a huge affect on your profit or loss). As a trader, you are solely interested in buying low and selling high (like futures and commodities trading on Wall Street). Wider Forex charts and spreads means buying higher and having to sell lower.
A half-pip lower spread does not necessarily sound like much, but it can easily mean the difference between a profitable trade and one that losses money. The tighter the spread is the better things are going to be for you (Happy Days).
Nevertheless, tight Forex charts and spreads are only meaningful when they pair up with good execution of a well laid out trading strategy. A good example of this is, as you analyze your forex chart it shows a tight spread, but your trade shows it has filled, or mysteriously rejected.
When this occurs repeatedly, it means that your broker is showing tight Forex charts and spreads but is effectively delivering wider Forex charts and spreads. Rejected forex trades, delayed execution, slipping, and stop-hunting are strategies that some brokers use to get rid of the promise of tight Forex charts and spreads (so be on the look out for this type of activity and run fast if you notice it).
Both the technical and fundamental forex analyst uses Forex charts. The technical analyst analyzes the “micro” movements, trying to match the actual occurrence with known patterns. The fundamental analyst on the other hand tries to find correlation between the trend seen on the chart and “macro” events occurring parallel to that like (political and other events).
As you can imagine, reading and understanding forex charts can get confusing for the inexperienced trader. You can get most charts now online, as part of a subscription service, and they most often include frequent updates. Because technical analysis is such a popular method of forecasting and predicting movements in the forex market, there are many services available online.
If you would like to become more proficient in Forex chart techniques (and I highly recommend you do), joining a service that provides charts via the Internet, and assistance in reading and analyzing the chart information, this can be very helpful and profitable in the end.
So let us not talk a little about the different types of Forex Charts Line Charts The simplest form, based upon the closing rates (in each time unit), forming a homogeneous line. (Such charts, on the 5 minutes scale, will show a line connecting all the actual rates every 5 minutes).
This forex chart does not show what happened during the time unit selected by the viewer, only closing rates for such a time. Line Charts are the best simple way to chart for support and resistance levels. Forex Trading Canada Tax
Point and figure charts
Point and Figure Charts are charts based on price without time. Unlike most investment charts, point and figure charts do not present a linear representation of time. Instead, they show trends in price. A rising stack of Xs represents increases, and a declining stack of Os represents decreases.
This type of chart used to filter out non-significant price movements, and enable you (the trader) to determine critical support and resistance levels quickly.
Bar Chart
This chart shows three rates for each time unit selected: the high, the low, the closing (HLC). There are also bar charts including four rates (OHLC, which includes the opening rate for the period). This chart provides clearly visible information about trading prices range during the time period (per unit) selected (very valuable information).
Candlestick Chart
Kind of chart based on an ancient Japanese method. The chart represents prices at their opening, high, low, and closing rates, in a form of candles, for each time unit selected. The empty (transparent) candles show increase, while the dark (full) candles represent decrease.
The length of the body shows the range between opening and closing, while the whole candle (including top and bottom wicks) show the whole range of trading prices for the selected time unit. Pattern recognition is a field within the area of “machine learning”.
Alternatively defined as the act of take in raw data and taking an action based on the category of that data. As such, it is a collection of methods for “supervised learning”.
A complete pattern recognition system consist of a sensor that gathers the observations to be classified or described; a feature extraction mechanism that computes numeric or symbolic information from the observations; and a classification or description scheme that does the actual job of classifying or describing observations, relying on the extracted features.
In general, the forex market uses the following patterns in candlestick forex charts:
Bullish Patterns – hammer, inverted hammer, engulfing, harami, harami cross, doji start, piercing line, morning star, morning doji star.
Bearish Patterns – shooting star, hanging man, engulfing, harami, harami cross, doji star, dark cloud cover, evening star, evening doji. Forex Trading Canada Tax

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Forex Options Trading – the Importance of Charts in Currency Trading

August 10, 2010 by  
Filed under Currency

If you are new at currency trading, the number of articles that tell people how to go about with their Forex trading activities can get you confused as to which piece of advice to follow. But when it comes to the use of Forex charts, you’d do well to remember that you can use all of them if you wish. There are basically five types of charts commonly used in currency trading, and they are the following: the line chart, the bar chart, the candle chart, the Heikin-Ashi chart, and the Renko chart. The trick is to know when to use one chart at a particular time and when to use another in a different situation. But why do traders need to use charts in the first place? Most traders agree that it is more convenient and easier to trade with the use of price charts and the corresponding technical analysis that comes with them. If you are just starting your career as a full-time or even part-time Forex trader, studies show that you are more prone to relying on your instincts more than anything else. This is not a very advisable thing to do because instincts make use of emotions, which in turn are as volatile as the market on bad trading days. With charts, you can plot price changes more effectively and become correctly informed of the signals you need to watch out for. Currency trading is a lucrative means to make money, but it does require patience, determination, and strategy. By learning more about the types of charts, you can increase your chances of earning big money and, at the same time, cut down your potential for losses.

Timothy Stevens is a Forex Options Trader who owns http://www. NonDirectionTrading. com – He has helped hundreds of people on Trading Forex with Options.
He has recently developed a free e-course showing you a step by step process for starting your Forex Trading easier. To learn how to start Forex Trading with Options without wasting your time and losing more money, visit http://www. NonDirectionTrading. com/members/FreeReport. htm

Forex Currency Trading Strategies

July 11, 2010 by  
Filed under Currency

The particular currency trading strategy you decide to use will depend partly on your personality, but also partly on how much money you have to start. If you’re starting with a relatively small amount of money, say less than five thousand dollars, you will want to use trading strategies that synchronize well with a medium term horizon, also known as swing-trading. For those operators who do not have much initial capital to trade with, trying to become a day trader right out of the box is likely going to be a wasted effort. This is because you must master the negotiation outside the frames times first, then as you well in this type of trade can think of to learn how to day trade, that is if you are interested in best strategies él.Las currency trading are those that allow you to remain calm and trust in each operation takes, while not requiring to sit at the computer all day or wait for something stupid as a gauge to give a buy or sell signal. Simple strategies such as trade around analyzing price charts and premiums of the price dynamics that occur in them, are what most professional traders use. You will be very difficult to find a trader to analyze a price chart with three oscillators and 10 different moving averages about it, but the ironic part is that many businessmen start their trade in mercados.Como noted above, the strategy specific forex trading you use not only depends on the amount of money you have to start with, but also in personality. Most people are attracted to the world of forex trading because they are unhappy with their current job, or maybe they are happy and just want to make some extra money. Most people are not attracted to currency trading, since it seems that sounds very fun and entertaining to sit in front of a computer screen for five hours while watching prices go up and down bars. However, surprisingly, this is exactly what most traders tend to principle. One tends to think more time spent watching his letters or his trade, more “control” they have on the market and therefore they will do better in the long plazo.Esto is really one of the great paradoxes of the sale currency, the same reason that most traders do not to make money consistently in the monthly or quarterly market is mainly because they are too involved in their offices and mess with them while they are under implementation. These types of errors that overactive traders for being too involved in their operations are usually the result of having a complicated trading strategy, or one that does not fully trust. When trading forex trading strategies which are simple in design and are based on simpler concepts of dynamic pricing, which really have nothing to be confused or uncertain about, as a result trade is improving with time.

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