May 1, 2012

Forex Signal Services – Should You Trust Them?

When I begin trading Forex, I felt the kind of addiction and excitement like never before. The market surged and my balance green… A swift kill on the market and I banked $500+ on a 50 pips gain (little did I realize, I was trading 1 lot). I remember using the winnings – of which took me (and the market) 41 minutes – to buy some new gadgets the next day.

How To Find Honest Forex Signal ServicesFast forward 1 year down the road… Trading Forex full time is harsh. I made a lot of money, but I couldn’t find myself the kind of excitement it used to provide. I feel jaded and needed rest… That’s when Forex signal services came to my mind. In my previous post about Forex signals I talked about my recommendation and review on Forex signals from BigAppleForex.com.

I’m very please with the results with them thus far and to be honest with you, you should sign up with them and diversify your portfolio a little. I talked to their support and found out that they are a bunch of passionate Forex traders. I tested them and they have very good grasp on the market, for which I would say they are better than in some currency pairs. While I always encourage my students to subscribe to Forex signal services, I must warn you that not all of them are genuine and before I stumbled upon these guys, I have a couple of burns with other Forex signals providers.

In this post, let’s discuss my findings on how to locate a profitable and honest Forex signal service.

Forex Signal Services – 5 Tips to Get a Profitable One

Since many Forex signal services can easily come up with fake claims, we should exercise extra caution when dealing with them… For if they are bogus, we fail not only our subscription fees, but our real capital too (ouch!).

Forex Tip #1Forex Signal Providers should always update their performance results. Those who left their results outdated would mean something fishy is going on… Perhaps they have a terrible month and refused to update their results? Perhaps they have abandoned their services long ago. Avoid these guys!

Forex Tip #2 – Performance! We need to know how much they earned in the past. We need to see those trades. The least they can do is upload their Performance report. If they are only showing “Month 1 – 800 pips, month 2 – 900 pips”, don’t bother signing up with them!

Forex Tip #3 – Too good to be true. Excellent Forex traders can get somewhere between 300 to 600 pips (if they aren’t trading GBP/JPY). If anyone comes and tell you they make 2000 pips every month then you should really take a goooood look on their performance. Ask them for an investor password or something.

Forex Tip #4 – Chat with the support. Some of the have chatting support, others only email via contact forms. Get a feel of how the support treating its customer. Test their knowledge with Forex trading. Monitor how long it takes them to reply. Good services value their customers and response fast. That should at least let you know that in the event you went into technical trouble, you’ll get someone to assist you ASAP.

Forex Tip #5 – 3rd party verification and Forex review sites. 3rd party verification results was once popular in Forex trading but many have claimed that getting verified by 3rd party exposes their Forex signals to security risks. If they have one, then that’s a bonus, too! In addition, I wouldn’t trust Forex reviews sites like ForexPeaceArmy etc since many of the reviewers post fake reviews – destroying competitors reputation, or buying reviews for their own businesses… Everywhere! I had a really bad experience with one of the signal providers and guess what, it’s page on FPA is full of positive reviews!

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April 24, 2012

5 Minutes A Day Forex Trading Strategy

I promise you guys some time ago that I’ll share one of my most simple but effective Forex trading strategy. Before we begin, there’s something that I’d need you to understand. Let us begin, shall we?

The Benefits of Long Term Forex Trading Strategy

– Trading on daily or weekly chart would mean significantly less screen time on the market, meaning more time to spend on your leisure or entertainment.

– It’s so simple that any newbie with IQ 90 and above can execute perfectly.

– People with full time jobs are able to employ this trading system, 5 mins a day from Monday to Friday.

– Trading on long term charts means less “market noise” and sharks won’t be able to take you out so easily.

– Less screen time also means less pressure for you psychologically

…And The Drawback

– You won’t be getting trades everyday. In fact, it’s reasonable to expect probably 1 valid trade per month. So you will need patience. A lot of them.

– Your trades are positional in nature, so expect to keep them anywhere from a few days to weeks.

– You’ll be require to set comparatively larger stop losses. We are talking about 200 to 500 pips depending on the currency you trade.

This trading system is about the most easy to learn, effective but slow among other Forex strategies that I have encountered. Now you have learned the benefits and drawbacks of this strategy, decide for yourself if this trading system suits you. If you are a 9-5 guy and would like to make money with Forex trading then this strategy is for you.

The 5 Minutes Forex Trading Strategy

To setup this Forex strategy, there’s 2 essential indicators that you’ll need:

– Relative Strength Index (14), and

– Bollinger Band (20)

Note that the above indicators a freely available on your MT4 platform and there’s no need for additional purchase or downloads.

Step 1: With your account and EURUSD chart ready, add the RSI and BB indicators to your chart. Do not change any settings as the default is perfect. The default settings for RSI is 14 period and BB is 20.

Step 2: Change your timeframe of your EURUSD chart to D1 and select candlesticks.

You should have a chart that looks similar to the following (click to enlarge):

5 Min Forex Trading Strategy Setup

When you’re all done, it’s time ready for some monitoring. All you need to do is repeated check back on the chart at a specific time of the day. Depending on where you are, I’d normally check it out when the London sessions closed.

The Rules of Entry For Buy Positions:

1. When price pierced through and closed lower than the lower channel of the Bollinger Band

2. When RSI is below 30 showing signs of oversold and weakening momentum

5 Min Forex Trading Strategy Setup

Take Profit

1. I let the profit runs until there’s sign of weakness in the momentum – price narrowing down and ranging for 3 days or more

2. If you do not know how to gauge the market’s momentum, just set your TP at a specified level of 200 pips, or on the next resistance level.

Stop Loss

1. I always use 200 pips stoploss for EUR/USD and 300 pips for GBP/USD.

2. You are free to tweak around with your SL and TP as long as you keep your money management healthy… Which means TP should always be larger than SL!

That’s about it! This Forex strategy may be boring but it’s extremely profitable over the long run. Unlike many day trading systems, you do not need to possess pinpoint precision over your entries, SL or TP levels, because there’s significantly less market noise on a D1 chart. If you still can’t get it, then you should rely on expert’s Forex signals and let others do all the dirty work for you.

Please note that this I trade this solely on EUR/USD and GBP/USD. You are liable to your own losses if you choose to apply my personal Forex trading strategies in this post and blog.

April 17, 2012

15 Minutes Week Forex Trading Secret

Yes, I know we are all busy. We can’t afford to trade Forex 24/5.

Heck, many of us can’t even afford to commence trading on a daily basis. We have been working day-in day-out… And we are tired. Some nights we just needed some “escape” from work, while others we are busy with life’s chores.

We all know Forex trading can be a good source of income, but 3 months down the road, the passion faded and Forex trading and training and learning became a thing of the past.

For Forex traders who do not have the luxury to trade on a daily basis, there’s a couple of alternatives that could easily remedy the problem. I’ll start right away…

Forex Signals

Automated Forex SignalsAutomated Forex signals could go a long way – if you got the right one. I have covered some tips and recommended BigAppleForex.com in my previous post on everything you needed to know about Forex signals.

There are many Forex signal services in town and I do not recommend simply trying out any of them. In the event you got yourself in one of them, make sure you try it out with your Demo account for 2 weeks first and see how they trade. Evaluate for yourself with some of these pointers:

Do they set SL? Are the SL too large for my taste? How many trades do they entered? Did they post their results on their past performances? Or simply a figure?

Finally, ensure that you don’t sign up for SMS signals. I have a few of those and they almost never arrive on time. Copying Forex signals directly to your MT4 is much much better to be honest.

Automate Your Forex Trading Strategies

This is assuming you already have a very solid Forex trading strategy that you would love to automate. If you require more details, you should check out my post on Forex Strategies.

Whether you are a coder or not, it is absolutely easy (and cheap) to get your Forex strategies coded by a quality Freelancer. I have personally hired a coder from oDesk.com before and the result is amazing. I paid for $180 for a complex EA and it was done in less than a week!

I’m trading full time but I can’t stay on the screen forever so it’s good to have this EA as a substitution every now and then so that I won’t miss any trades. It’s a recommendation to all serious trader really… Build your own EA!

Trade The Weekly Chart

Okay, trading the weekly chart is but some of the most boring strategies on earth. But when you finally realize that your goal is to make money with Forex trading and not seeking for excitement, then welcome aboard!

Take note that when you are trading on the long term, there’s some distinctive benefits and drawbacks.

The good news is that you can almost filter out all the daily “noise” in the market and the real market trend / sentiment almost present itself crystal clearly. Your timing of entry becomes less significant since you have a larger profit target and margin. Daily spikes won’t take away your stop losses by surprises too!

Then the bad. Do you know you’ll be setting up extremely large stoplosses when trading long term? We are talking about 400 pips or in some pairs, 800 pips. That said, you’ll most likely need to reduce whatever lot size you are trading by 90% or risk blowing up your account. Mind you, profits will come in soooo slow that you might even forget you have a trade on 2 weeks ago.

Anyway, money is money, we can’t complain. I’m thinking of posting more about my Forex trading strategies for the weekly charts… Is anyone interested?

April 16, 2012

Forex Signals

The Ultimate Secret of Forex Trading – Automated Forex Signals

Hmmm? The title is a little exaggerated and weird at best. I know 🙂 Anyway, before jumping in like the rest of the mad mob, just hear me out – for I have evidences as to why Forex signals could be a soldier’s ultimate weapon on the battlefield – mind you.

Statistics have it that 90% or so of the Forex traders actually loses money. I won’t be surprise, since it’s a zero-sum game where when John wins, Joe’s gotta lose. Let’s place 2 separate Forex traders into a duel and let’s give a calculated guess on the outcome…

Trader 1 – Peter, is a Harvard graduate with 20 years of experience trading the Currency market and working hands on with many global financial institutions. He is currently employed by ABC Bank and is backed with billions of billions of dollars in the bank reserves. Peter is trading based on his experience, along with analysis from his team of experienced Forex traders (God knows how many of them grad from Harvard). Looking good? What about Forex trader #2?

Trader 2 – Joe. An average office employee with a company in the garment industry. Joe wanted some extra cash and diversification over his bonds or whatever, and begun Forex trading 2 years ago. Joe had some good months, and Joe had some bad months. Joe didn’t have much time to trade because he is working 9 to 5 Monday to Friday. He gotta spend time with his kids too. Joe trade the market based on some strategies he got from some traders in some forums.

So… We pit both of them together in a duel. Round 1, fight!

Joe lost.

Forex Signals - Join the fittest or be annihilated

Simple as that. Do you know how many Peters are there in the market? Many of us are just average Joes. We have NO WAY to beat these Peters, if:

1. We aren’t exceptionally SMART, or

2. We don’t have DECADES of EXPERIENCES, or

3. We don’t have Forex trading strategies that WORK UNDER ALL CONDITIONS, or

3. We aren’t working our Arses off 25 hours a day because we trade alone and they have a freaking team).

My Favorite Forex Signals Service

Imagine this: Being thrown into the battlefield once again, but this time you can punch like Mike Tyson and shoot like James Bond. How does that sounds? Like a dream, right?

With the right Forex Signals in your portfolio, that’s exactly how you should feel like – Mike Tyson and James Bond combined. What’s the catch, you ask? Many Forex signals services are provided by experts – people who have worked in Banks and stuffs and trade like Soros. Some are downright scams.

I am personally investing part of my Forex capital with BigAppleForex.com’s Forex signals service. 5 months down the road and I can testified that they are really great. I’m not exactly going to give a full blown review here but I’m happy with them so far. When I started they only charged a tiny $200 so just go ahead and try them out and you’ll see what I mean – consistent profits, automated trading (which I only check every week now) and brilliant customer support.

Nonetheless though, I never put all my eggs in all baskets so I only invest about 30% with them and to their credit, I have managed to double that amount in a relatively short time. I don’t know if their winning streak will last but if I were you I’d be on the wagon as soon as I can because you won’t find many profitable Forex signal services regularly.

Anyway, it’s about time for today… Let’s talk about Forex Brokers in my upcoming posts, soon 🙂

April 15, 2012

Forex Trading Strategies

Trading the Forex market successfully – aka profitably – requires some good plans. We talked about the basics of Forex Trading for newbies in my last post, and I remember mentioning that trading without proper training is like being thrown into the battlefield, like first thing tomorrow morning.

A proper Forex training includes getting well educated in Forex trading strategies. Some beginners are always amazed by some random Forex strategies thrown to them by the so-called expert. While others ransacked forums ruthlessly and amassed as many Forex trading strategies as possible.

The point is, a trader having 200 Forex trading strategies don’t necessarily win over another person that possesses only 5 strategies. In fact, in my humble opinion, mastering 2 or 3 Forex trading strategies could possibly change any newbies trading and winning chances.

To get you in the picture, there’s probably thousands of Forex trading strategies right now, both free and paid. Many of these Forex strategies don’t work well with me, while some of them are absolutely diamonds. Bear in mind that while certain Forex strategies may work very well for some people, they might not work for you… But more about this later on. Let me share with you where you could find free Forex trading strategies.

Forex Trading Strategies

Finding Best Forex Trading Strategies

One of the sites that I used to frequent to for Forex trading strategies is ForexFactory (direct link to their Forex Trading Systems thread). You’ll find thousands of Forex strategies, Forex systems and occasionally privately developed EA (Expert Advisors). There are passionate Forex traders uploading and sharing their trading methods and some of the better ones receive a lot of testings and discussions.

The fact is, there are simply too many of these strategies going around so you probably won’t have a lot of time going through all, let alone mastering them. My advise is pick one of them and starting trying them out on Demo accounts with your Forex broker. Never trade real money UNTIL you have made profits with your demo accounts.

All in all, here’s a few factors to help you consider what kind of Forex trading strategies suit you best:

1. Scalping strategies:

Forex Scalping strategies refer to those trading methodology where trades are being entered and closes at a very short period of time, typically within minutes, in aim of tiny profits. Master scalpers often trade anywhere from 50 to 200 trade per trading day. This approach is most suited for full time traders, or unemployed people who have a knack for quick thinking and can work under pressure.

2. News trading:

News trader trade economical news and releases. There’s basically 2 school of practices – where many advocates enter the market at the blitz of moment when the news is released, others have claimed their success by doing thoughtful researches and entering the market with careful strategy beforehand. News trading are for trader who love to think and analyze more than sitting on the desk all day. News trading would potentially require larger investment capital in the event the price moves against your favor.

3. Day trading:

Day trading is undoubtedly my favorite among other Forex trading strategies. Day trading, however, is somewhat of a hybrid between scalping and news trading. You won’t be trading much as much as scalpers, but you’ll need to have better overview and interpretation of the market sentiment on a daily basis. If carefully executed, you’ll be making nice profits with day trading consistently.

Forex trading is not an easy task and do not expect to master anything today. Trial and errors and learning plays an important part of my Forex journey and the same story would apply to 99% of the currently successful Forex traders. If investing hard work isn’t your cup of tea, then you should stay tuned to the secrets I’m about to offer in my next posts about Forex signals… Ciao!

April 14, 2012

Forex Trading For Beginners

What is Forex Trading?

Forex Trading - Are you Lost?

In the 90s, it used to be Stock Trading as one of the fastest and most exciting way of making money (with money). Things, however, changed for now, with the introduction of retail Forex trading.

Literally, everyone is able to setup an account and begin their exciting journey where money makes money. Truth is, Forex trading would make you lots of money overnight, but be prepared to lose everything too if you aren’t being careful enough.

Certain experts always claim that Forex trading is easy and you can use Forex robots, etc and make easy money overnight… It’s all BS!

To trade the Forex market is like being thrown into a battlefield – you get shot down without even why…

But… Did anyone really make money with Forex trading?

Absolutely!

The same question should go with – Did anyone survive a tough and harsh battle? Of course.

When someone loses money in the Forex market, someone else wins the money. All in all, you need to win someone’s money in order to profit! That’s the prime difference with Stock Market, where the stocks “appreciates”. While currencies do “appreciate”, it doesn’t necessarily means that the economic conditions of the said country improves. Well, that’s a story for another day though.

Forex Trading is Tough – But Can I Master It?

You can. I knew that because I did so on my own – through hard work, losses and experiences – and meeting the right mentors and companies. If you are soldier, you get to receive lots of training before being deployed to the field… But newbie Forex traders were never taught anything at all!

To get you started, you should spend some time and get to understand the basics of Forex trading. I’d personally recommend Babypips as they have a well prepared Forex educational systems. Spend as little as 15 mins a day and by the end of the month you should find yourself well-versed in the Forex market to say the least.

Meanwhile – DO NOT trade with your real money. Do sign up demo accounts and trade as many as you could and analyze every trade you make.

I’ll talk more about the secrets on how I made literally hundred of thousands in a while. Until then – Stay tuned!