You only have to think back to recent stock market scams like Enron to know that it is almost impossible for the average, and even very sophisticated fund manager or hedge fund trader to really know what the real financial state of a company is.

Just by reading the balance sheet and other quaterly reports they release gives you a very poor insight into the real health of the company. Whereas the technical analysis charts of the company tend to give the real picture of what the market thinks of the value of the company. In the case of Enron even simple technical analysis told you to SELL when the stock was in the $80-90 range, this is why technical analysis of stocksis so popular.

So what is the secret to technical analysis?, Im about to tell you, here are my golden rules:

* Only use 3-5 simple technical analysis indicators

* Make sure that you understand how the indicators that you have selected work, what the parameter settings are and in what market conditions they are effective

* After selecting your indicators and parameter settings dont mess with them.

The real secret to technical analysis is to become VERY familiar with your choosen indicators, and really this can only be done by watching and studying the market, so that you get to the point that you TRUST them.

The fact is that in any market, for each bar, there are only 5 pieces of information, the open, close, high, low and volume, yet there are now hundreds of indicators. Most of these indicators are displaying the same information and so are redundant.

For the record my set of indicators are:

* 4 Simple Moving Averages

* Bollinger Bands

* MACD

* Stochastics

But the way I use them is quite special, to learn more about how to become an expert at technical analysis visit:

Top Dog Trading Review

You can buy 2 options or sell 2 options or buy one option and sell another option. The options you buy have to be in a different strike price to be considered a spread. If you just were to purchase 2 of the same options, that would not be a spread. The 2 options would have to be 2 different future option contracts. Lets look at corn. These are not current prices, just an example. If I purchased 2 $3.00 corn options, that would not be a spread. If I purchased one $3.00 corn option and sold one $3.10 corn option, that would be a spread. I would put this trade on in one order.

Not all spreads have to be in the same contract month or even the same market. When putting on a spread in different months, you could put in an order to buy one option in one month and sell another option in another month at a certain price. These are called calendar spreads as they involve different months.

Now when putting on a spread, you will either have money coming into your account or going out. If your purchased options cost more than the sold options, you would state that you are putting it on for a debit. If you are taking in more with the sold options than you are paying with the purchased options, you are putting the spread on for a credit. I will discuss other types of options strategy using spreads in another article.

For example, if the underlying futures market was trading at 3.00 and I sold a 3.50 call option, this option is not yet in the money. It is out of the money. If the futures hits 3.50, then the option is at the money. Once it goes beyond 3.50, it is in the money. If I sold the commodity option and the futures eventually goes to 5.50, then it has 2.00 worth of real value or intrinsic value. So we can lose more than we expected. Some people only buy options for this reason.

When buying futures options though, you are paying premium and this is risk as well. The chance that you will be in the money and recover your premium payment is the risk involved. There is unlimited potential with limited risk. But the disadvantage is that the options usually expire worthless. Leverage is the reason people buy futures options. You can control the underlying futures with a smaller investment and less risk than by buying or selling the futures contract. I am paying a premium to do this and I am trading time as well. Meaning, I only have until the option expires to be correct, so time is a factor in futures options trading also.

Futures options sellers are trading the fact the an option will not be profitable for the option buyer before a certain time frame. Hopefully the futures option will expire worthless or lose value before the expiration of the option.

I will write about different techniques in another article. There are many ways to trade futures options. You can buy an option or sell an option or you can put on a credit spread where you do both.

Many professional traders write books in an attempt to teach others what they have learned in the market. Learning from professionals is the best way to get a quality currency trading education. Select several of the top ranked books and use them as study guides on an ongoing basis. You may find it helpful to have these publications on hand to refer to when needed.

It is highly recommended that you take a trading class to get prepared to enter the real market. Most are taught be professional traders so you will get a lot of first hand information on what actually happens in the market. You can take an online course or one that is taught in an actual classroom.

Using the proper tools to help you make accurate trade decisions, is an important ingredient to making profits in the currency market. Technical analysis is one of the best tools to use. Since most traders are familiar with technical analysis and most use it, you will be at a distinct disadvantage if you don’t understand it and use it also. Charts can help you see trends as they develop so that you can take action to profit from them. If you become good at using charts you will be able to see when a trend is about to end. This will allow you to take appropriate measures to protect your profits.

Learning to use technical analysis along with fundamental analysis will help improve overall trading performance. Fundamental analysis involves relating economic conditions to price movements. Some things that fall in this category are inflation rates. Interest rate changes can affect currency prices. Political conditions inside a country also have an impact. The best approach to predicting future price trends is to use fundamentals and technical indicators to make your predictions.

Trading with a demo account for a period of time before you use real money is one of the smartest ways to get a currency trading education. This allows you to make mock trades based on real-time market conditions. There is no better way to see your level of skills than this. Many brokers will allow you to do this for a period of time in the beginning. This practice time will help you develop trading instincts that can serve you well over your trading career. If you have the opportunity to do this, it would be foolish not to.

Continuing education will help you maintain your level of skill rather than letting it get stall. Self-study is important to do no matter how much success you have. Subscribing to relevant publications and staying abreast of industry developments is essential.

Get the best currency trading education you possibly can. It will move you to levels of success that nothing else in the market can. Spend the time and money to make yourself an expert.

The KEY to getting a good currency trading education is an excellent currency trading tutorial!

Many individuals are also looking to trade in it, because of its huge profit opportunities and it convenience. Whilst these factors are definitely great reasons to want to start out trading Forex, it is also vital to realize that it’s not easy and that to achieve success, a trader will need to get a top quality Forex brokerage.

1 of the problems is that Forex is not traded on an regulated exchange, the marketplace is simply too massive, thus there’s no governing body that regulates it.

Unfortunately, that means that a number of the brokers opt to operate as they please, or in an unscrupulous manner. Traders definitely need to stay away from these brokers totally.

The factors a trader wants to concentrate on to avoid these brokers include, brokers who do not perform trades immediately, or as close to instantaneously as possible. This is known as slippage and although some slippage will normally transpire, particularly during quick changing markets, a few brokerages manipulate this to their own advantage.

Additionally traders need to look for brokers that have a small spread. This is the difference between the bid and the ask price, or what you purchase it at and sell it at, at any specific time. The bigger the spread the more expensive it is to trade.

Also, high quality brokers will supply a pro suite of tools, so traders can trade exactly as corporate traders would do, with up to the minute financial reports.

There should also be a high level education and training capability meaning traders are able to develop their understanding of the market, as well as develop their trading tactics.

Another big issue is choosing a broker that may supply a practice account to traders. This for a few folks is totally critical, since trading with real money while not 1st practicing can have really severe ramifications. Many brokers offer practice accounts however, some do not.

Finally, a trader should study leverage. This is a private factor, as nearly all the brokers supply the chance to apply leverage when trading. Leverage means that you’ll be able to multiply the amount of cash that you are trading with.

This can have blessings and downsides since, the profits and losses are multiplied. This is what the trader must remember and not use too much leverage. I have witnessed many traders use way too much leverage, way too quickly and have finished up wishing they hadn’t.

I myself recommend to all or any the traders who ask me, that they must use no more than 3 to 1 leverage.

To see an independent review of the Best Forex Brokers, just Read This.

To get started in learning about forex trading, you will need to locate the forex trading software, education-learning system you want to use. As you find the games, as they are called, you will enter information about yourself, about what you are interested in learning and then you will download software to your computer. In following the ‘game’, you will learn how to make and lose money in the forex market. This type of game is going to make you more aware of what happens daily, how the markets open and close, and how different the various countries currencies really are.

You will open an online ‘account’ using the gaming system. You will then be able to read the news, find and compare markets, and you will be able to make ‘fake’ trades so you can watch your money build or be eaten away in losses. As you learn the system, using it a few times a week, you are going to be more prepared, more educated and you will be ready to use the forex trades to make money. Of course, you may still need the aid of broker or a company to make your transactions happen but you will better understand the process, what will happen, and what calls you may want to make when you read about the news, the markets, and the currencies in other countries.

The forex market is also referred to as the FX market. If you are interested in joining the millions who are making money in the forex markets, you want to ensure you are dealing with a reputable banker or company involved in forex trading. With the spur of interest in the forex markets, there are many types of companies that are popping out on the Internet appearing to be genuine forex trading companies but in reality, they are not. Forex trading can be completed through a broker, a company that deals in the funds, and from within your own country. For example, the US has many regulations and laws regarding forex trading and what companies are permitted to work with the public dealing with international trading and markets.

Learn How to make your forex trading easier and more profitable with Forex Automatic Trading Software, or by learning allthe strategies and tricks of forex trading from Forex Trading Courses

This is the first article in a series we will be doing at www.PFXglobal.com on forex trading and intermarket analysis. Intermarket analysis is a tool that can be used to find trading opportunities in the market. 100% free forex education available from www.pfxglobal.com

Learning Forex markets

A beautiful setup forming up on USDCAD and EURCAD that I cannot take due to the longer time frame charts

trading forex

Forex Trading- Why should you invest in Forex over Stocks? In this video we point out some of the key advantages to the Forex market!

Feel free to contact me or my business partner Justin Kaiser at streamlinemktg@gmail.com

Currency Trader