Forex Trading education, tutorial and systems online

The Internet has made it easier than ever for the average person to get involved in speculative forms of day trading, like Forex trading.

In the past, Forex trades had to be carried out by calling up your broker’s ‘dealing desk’. Today, though, carrying out a trade is as simply as pointing and clicking from within your online trading account.

This is indeed a luxury but, as you may have guessed, there is both an upside and a downside to the technological ease of online trading.

One of the biggest problems is a phenomenon known as ’scalping’. Scalpers are traders who rely on the speed of electronic trading (and the ability to bypass the ‘dealing desk’) to ’scalp’ Pips.

In other words, they trade currencies on the smallest fluctuations in exchange rate. A scalper might trade a pair when it moves from 1.3435 to 1.3436, for example.

There’s technically nothing wrong with doing so, except that scalpers executes these types of trades hundreds of times daily. They may exit a trade before the broker even has time to deal with it, and this results in a loss…for the broker, that is.

Scalping is a risky strategy that is all to easy to perform online. So, the first thing you need to be sure of before you start trading is that you know what you’re doing. Scalping isn’t something you want to do as a beginner, regardless of whether you’re doing it intentionally or through sheer inexperience.

The second thing you’ll want to do is develop a long-term investment strategy. Forex is fun to ‘play’ with, and online accounts make it easy to jump in the game just to try it out. It has almost become a fad.

However, what the sad statistics bear out is that over half of all new Forex traders lose their money within a year. The foreign exchange market is seeing a lot of hype right now, and too many people are signing on in the hopes of making a quick buck. Forex is simply not that easy, though, and it is certainly not a get rich quick scheme for the average person.

So, before you start trading, make sure you take the time to educate yourself. There’s plenty of free information online, as well as top-notch training courses provided by brokers and expert investors.

Putting the necessary time up front into developing a long-range strategy, and educating yourself on the marketplace, will go a long way to assuring your success.

James Gradstaff

Forex Trading Expert

Forex Day Profitable Trading Tutorial for Newbies: An Introduction

Many of our successful investors start from somewhere small such as this Forex Day Profitable Trading Tutorial. This is our first step in educating you to be the leader in trading foreign currency. Successful traders who completed our tutorial went on to the real ground floor of stock exchange markets and made profits instantaneously and recommended us to publish this Forex Day Profitable Trading Tutorial for serious investors to follow.

So, you think trading currency on the foreign exchange market is straight-forward? Think again! Many who think so ended up losing their shorts (change) at the end of the day and came crawling back to learn the basics. Forex is more to it than meets the eye.

Our Forex Day Profitable Trading Tutorial you’re about to receive here will give you a basic idea of how things works. However, you must keep in mind that this tutorial is only scratching the surface. The Forex market is complex, fast-paced and requires serious further investigations, but if you wish to trade successfully, our Forex Day Profitable Trading Tutorial is where you need to start.

Let’s start from the most fundamental building blocks of trades—currency. Currencies, like all traded goods have prices. The price of a currency is its exchange rate. It costs $1.50 to get 1.00 British pound. It also implies that it only costs 0.67 British pound to buy $1.

We will elaborate on the exchange rate later on in our Forex Day Profitable Trading Tutorial. But let us dig down to why US dollar is worth more than Canadian dollar; in other words, why is that one currency is worth more than another, and why the exchange rate fluctuates?

It used to be that most currencies of the world were backed by rare metals such as silver and gold. The US followed ‘gold standard’, which secured the dollar to an equivalence of one ounce of gold. The rest of other currencies were secured to the dollar and were allowed to vary no more than 1% margin. This small fluctuation of exchange rate was called ‘fixed exchange rate’.

That was over a century ago. Now the gold standard exchange rate has been abandoned, along with the fixed rate model. Instead, the new ‘fluctuating exchange rate’ model has been adopted in the foreign exchange market. Fluctuating exchange rates are no longer dependent on gold. They are governed by the market forces of supply and demand.

All traded goods is determined by supply and demand. The demand for a currency comes typically from foreigners who want to buy goods and services (Exports), or to lend and invest. The supply of a currency typically comes from locals who want to sell their currency in order to buy goods and services abroad (Import), or who want to borrow or repay investments. If we think about lend and investing as the trade in assets (bonds, stocks and physical capital), then these can also be thought of as exports. That is, if foreigners lend money, they are importing assets (an IOU), while the country receiving selling the IOU is exporting those IOUs.
Sales of goods and services are referred to as current account activities, while sales of IOU and physical capital are typically considered capital account activities. Putting these together we can construct the supply and demand for currencies:
a. Demand for a currency largely consists of Exports of Goods and Services (the Current Account) and Exports of Assets like Bonds, Stock and Direct Ownership of Assets (the Capital Account).
b. Supply for a currency largely consists of Exports by citizens of Goods and Services (the Current Account) and Exports by citizens of Assets like Bonds, Stock and Direct Ownership of Assets (the Capital Account)

Those are the basics of a currency trade, but there are other factors to take into consideration. In order to make a profit on currency exchanges, you must also know how to calculate the cash value of exchange rate fluctuations in terms of ‘basis points’ - or, in Forex terminology — ‘pips value’ which will be discussed later on in our Forex Day Profitable Trading Tutorial.

James Gradstaff

Forex Trading Expert