FOREX TRADING

FOR DUMMIES

How to Master the Market in 30 Minutes.

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Contents:

1. The Basics of Forex trading ……………………………….....3 The Forex Market’s Characteristics ……………………………………..4 Top Currency Traders and Major Currencies Traded ……………..4 A Forex Trade …………………………………………………………………..5 The key players in the Forex market ……………………………………5

2. Fundamental Analysis of the Forex Market ………………6 Why should you analyze the market? ………………………………….6 Fundamental Analysis ………………………………………………………..7

3. Forex Technical Analysis ………………………………………8

2 main goals that every Forex Technical trader must have ….10 4. How to Read Forex Charts11 Forex price charts, what do they mean and how to use them.11 Pricing ..………………………………………………………………………….12 The Chart Data Window …………………………………………………..12 Chart Intervals & Time Frames. ………………………………………..13 5. Psychology and the Market …………………………………14 Forex trading as a mind game .…………………………………………14

It’s all about the numbers ………………………………………………..15 6. What is the Best Forex Trading Strategy ………………..17 What Is A Forex Trading Strategy? ……………………………………17 Which Forex Trading Strategy To Choose? …………………………18

7. 7 Steps to Choose a Good Forex Broker …………………19 8. The Best Forex Brokers Comparison And Reviews ……22

eToro Review ……………………………………………………………..23 AvaTrade Review ………………………………………………………..23 Anyoption Review ……………………………………………………….24

9. Special Bonus: How to Succeed in Forex Without any

Skills and Experience …………………………………………25 How to trade like a PRO from day 1 …………………………………25

How to start copying ……………………………………………………….26

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The Basics of Forex Trading

Forex trading or Foreign Currency Exchange Trading refers to the simultaneous trading. That is buying and selling of two different currencies at the same time. It is done between major financial institutions such as central banks, small retail currency traders, large international companies, government institutions, companies with international operations, etc. Based on the amount of money being traded on a daily basis, the international Forex trading market is the world’s biggest financial market. Everyday, Forex trading market circulates an average of 1 trillion US dollars, an amount far greater than the total volume produced by all the stock and bond markets in the world.

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The Forex Market’s Characteristics Forex trading is a kind of over-the-counter trading. It occurs directly between two financial institutions or currency traders. The trading markets may be interconnected but there is no single unified market. Hence, there is also no single or standard rate. Each rate or price depends on what is being traded. However, the traders traditionally use nearly similar rates. Another characteristic of Forex trading is that it operates 24 hours a day from Monday to Friday. Thus traders can trade any time of the day. Also, there is no need of an exchange office, as the Forex market works through a global electronic network where trading occurs over computer networks. This characteristic also prevents delays in order execution that could take a lot of time. Forex trading market is also very competitive and is highly volatile. This allows the parties to get low dealing costs and better price. Top Currency Traders and Major Currencies Traded According to the Wall Street Journal the 10 major market’s participants are responsible for 73 percent of the total Forex trading volume. Among them are Deutsche Bank, UBS, Citigroup, HSBC, Barclays, Merrill Lynch, J.P. Morgan Chase, Goldman Sachs, ABN Amro, and Morgan Stanley. As for the currencies the mostly traded ones are the US, Canadian, and Australian dollars; Euro; Yen; and Swiss Franc. The Bank for International Settlements made a research study that shows that the most traded currency pairs in the Forex market are EUR/USD, USD/JPY, and GBP/USD. The

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study noted that despite of Euro’s continuous growth, the Forex trading market remains to be traded in US Dollars. A Forex Trade A trade happens when you accept the offered price and when the dealer confirms it. There are always two different currencies involved in every trade. Each currency has a price expressed in another currency such as 1 Euro is equivalent to 1.204 US dollars. In this example, the Euro trader sells the Euros and buys the US dollars. There are no further costs in the trade. There are no commissions and other fees as well. Large international companies participate in Forex trading when they are buying or selling goods to other countries. However, this kind of Forex trading evolves only a small portion of the daily activities in the foreign exchange market. Most of the trading activities are carried out by currency traders who earn from the changes in value of a particular currency. The key players in the Forex market BIS study shows that more than 50% of the Forex trading transactions are happen to be the interbank transactions. The amounts circulating in the Forex transactions are done through the banks. Central banks play a big role in the Forex trading market. These banks control the supply of money, interest, inflation and target rates in order to stabilize the Forex trading market.

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Fundamental Analysis of the Forex

Market

Why should you analyze the market? The Forex trading market is an around-the-clock cash market where the currencies of nations are bought and sold, typically via brokers. For example, you buy Euros, paying with U.S. Dollars, or you sell Canadian Dollars for Japanese Yen. Forex prices can change at any moment in response to real-time events, such as political news, crude oil prices changes, inflation, import and export increase, or industrial production drop. The Forex market traders typically use Forex analysis as a way to predict currency prices movements. Forex analysis

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itself is divided into two types: fundamental and technical. A fundamental analysis uses economic and political factors as the means of predicting currency movements. A technical analysis uses reliable historical data in order to forecast these movements. Fundamental Analysis A fundamental analysis uses economic and political factors, such as housing stats, the unemployment rate, or inflation, to predict the changes in the Forex market. Fundamental analysis is concerned with the reasons or causes for the price changes. Many Forex traders who rely on fundamental analysis plan their trading strategies around a number of key U.S. Government economic indicators. Some of these indicators are the Gross Domestic Product (GDP), Foreign Exchange Rates, Import and Export Prices, Industrial Production/Capacity Utilization, the Composite Index of Leading Indicators, Consumer Credit, the Consumer Price Index (CPI), Retail Sales, Housing Starts, the Employment Cost Index, and Consumer Confidence. All of these Federal economic indicators have a marked effect on both the stock market and Forex. Some of these indicators are released weekly, while others are released monthly or quarterly. Their sources include the Federal Reserve Board, the U.S. Bureau of Labor Statistics, the U.S. Department of Agriculture, the U.S. Bureau of Economic Analysis (BEA), and the U.S. Census Bureau. The best way to be updated about the most important economic data for your favorite currencies is to use an economic calendar. One of the best economic calendars may be found on the www.ForexFactory.com website. *Learn how to use the Forex Factory calendar here.

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Forex traders must take other economic indicators into consideration as well. The world's leading economies (for example, the United Kingdom, Japan, France, and Germany) also release their own economic indicators that often have a significant impact on the Forex market. For example, leading economic indicators in the United Kingdom include Housing Prices, Gross Domestic Product (GDP), Vehicles per 1,000 People, Telephones per 1,000 People, and the Percentage of People Employed in Agriculture

Forex Technical Analysis

The Technical Analysis is the easiest and the most precise way of analyzing the Forex market. All available information

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on any particular currency and its impact on the market and the traders are already reflected in the currency's price. The foreign exchange market is mostly composed of trends and therefore is a place where technical analysis can be used very effectively. Experience has shown that history repeats itself over time, certain chart patterns become consistent, predictable and very reliable. The problem is being able of spot them. Prices move in trends and those traders who don't know this fact obviously don’t need to implement the technical analysis to analyze the market as they don’t realize its importance. But, over 100 years of research has shown that those who trade "with the trend" greatly improve their chances of winning in the Forex markets. Many times finding the main trend will help you become aware of the overall market direction and offer you better visibility, especially when the shorter-term movements tend to clutter the picture. And many times following the trend will bail you out of an initially uncertain entry point. The main question you may be asking yourself by now is how does technical analysis help you determine what the trend of the market is and how does it help your efforts to trade with the trend and not against the trend? It is important to mention that no one is claiming technical analysis being a magic tool of trading. And if you ask, which indicators are the best in Forex trading, the answer is none. Technical indicators should simply be the components of your overall customized / personalized trading system and not the systems themselves.

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2 main goals that every Forex Technical trader must have: 1. To figure out the price action of the currency pair. Price is the main concern. If the EUR/USD is at 1.3226 and goes to 1.3219, 1.3112, 1.3008 - the market is in a down trend. Despite what every technical indicator might predict, if the trend is down, stay with the trend. Indicators showing where price will go next or what it should be doing are useless. A trader need only be concerned with what the market is doing, not what the market might do. 2. Always remember that technical indicators are only giving you confirmations based on what the market is telling you. So listen and pay close attention to the market and let it dictate which method you will use and which tool you will pull out of your bag of strategies and techniques. Only by listening to the markets you will be able to conquer it successfully and become a profitable trader. A popular website Investopedia.com states that "In a shopping mall, a fundamental analyst would go to each store, study the product that was being sold, and then decide whether to buy it or not. By contrast, a technical analyst would sit on a bench in the mall and watch people go into the stores. Disregarding the intrinsic value of the products in the store, his or her decision would be based on the patterns or activity of people going into each store." Some Forex traders depend on fundamental analysis while others depend on technical analysis. However, many successful Forex traders use a combination of both strategies. However, the important point to remember here is that no approach or combination of approaches is 100% certain.

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How to Read Forex Charts

Forex price charts, what do they mean and how to use them? One of the most important things you should do before starting trading is: learn to read the charts as charts represent the lifeblood of the market. I admit that reading charts, and interpreting patterns, are more an art than a skill. Base and apply your entry and exit decisions on your own combined methods of technical and fundamental analysis. Forex charts, are easier to interpret and to use. They reflect a slower moving, stable economy of a country, compared to

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the stock market, with its daily drama of company reports, Wall Street Analysts and shareholder demands. Unlike stocks, currency charts do not spend much time in trading ranges and have the tendency to develop strong trends. Furthermore, Forex with its 4 Mayor currencies is easier to analyze than tens of thousands of stocks. (Mayor currencies are: USD/JPY, EUR/USD, GBP/USD and USD/CHF). Understanding just a few basic points about the technical analysis of currency chart can lead to increased profit potential. Pricing Price reflects the perceptions and action taken by the market participants. It is the dealing between buyers and sellers in the Over-The-Counter (OTC) or “interbank” market that creates price movement. Therefore, all fundamental factors are quickly discounted in price. By studying the price charts, you are indirectly seeing the fundamental and market psychology all at once, after all the market is fed by two emotions - Greed and Fear, and once you understand that, then you begin to understand the psychology of the market and how it relates to the chart patterns. The Chart Data Window Most of the charts will display a small box of data usually called a display window which will contain the following items: H = Highest Price L = Lowest Price O = Opening Price C = Close Price (or Last Price)

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The most common types of price bars, used in Forex trading, are the Bar Chart and the Candlestick chart: 1. Bars Charts is when the price bars are a linear representation (a line) of a period of time. This enables the viewer to see a graphic representation summarizing the activity of a specific time frame. Each bar has similar characteristics and tells the viewer several important pieces of information. First, the highest point of the bar represents the highest price that was achieved during that time period. The lowest point of the bar represents the lowest price during the same period. Regular bars display a small dot on the left side of the bar which represents the opening price of the period and the small dot on the right side represents the closing price of the period. 2. Japanese Candlesticks, or simply Candlesticks as they are now known, are used to represent the same information as Price bars. The only difference is the open and close form the body of a box which is displayed with a color inside. A red color means that the close was lower than the open, and the blue or green color represents that the close was higher than the open. If the box has a line going up from the box it represents the high and is called the wick. If the box has a line going down from the box, it represents the low and is called the tail. Chart Intervals & Time Frames. A chart time scale, or time frame, basically refers to the duration of time that passes between the open and the close of a bar or candlestick. For instance, with your broker

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software, you will be able to view a currency pair, in a 1-hour time frame over a 2-day period, 5-day period, 10-day period, 20-day period and 30- day period. Most of the short-term time intervals (5-min and 1-min charts) are used for entry and exit points and the longer-term time intervals (1-hour and daily charts) are used to see where the general trend is.

Psychology and the Market

Forex trading as a mind game When it comes to trading on the Forex market, winning is a matter of the mind rather than mind over matter. Any trader who’s been in the game for any length of time will tell you

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that psychology has a lot to do with both your own performance on the trading floor and with the way that the market is moving. Playing a winning hand depends on knowing your own mind and understanding the way that psychology moves the market. Studying the psychology of the market is nothing new. It doesn’t take a genius to understand that any arena that rides and falls on decisions made by people is going to be heavily influenced by the minds of people. Few people take into account all the various levels of mind games that motivate the market. If you keep your eye on the way that psychology influences others, including the mass psychology of the people that use the currency on a daily basis, but neglect to know what moves you, you’re going to end up hurting your own position. The best Forex coaches will tell you that before you can really become a successful trader, you have to know yourself and the triggers that influence you. Knowing those will help you overcome them or use them. It’s all about the numbers Let me break it down into more manageable pieces for you. Anything involving winning or losing large sums of money becomes emotionally charged. All right, you’ve heard that trading in the Forex market is a mathematical game. Plug in the right numbers, make the right calculations and you’ll come out ahead. So why is it that so many traders end up on the losing end of the market? After all, everyone has access to the same numbers, the same data and the same info? If it’s math, there’s only one right answer, right? The answer lies in interpretation.

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The numbers don’t lie, but your mind does. Your hopes and fears can make you see things that just aren’t there. When you invest in a currency, you’re investing more than just money, you make an emotional investment. Being ‘right’ becomes important. Being ‘wrong’ doesn’t just cost you money when you let yourself be ruled by your emotions, it costs you pride. Why else would you let a loser ride in the hope that it will bounce back? It’s that little thing inside your head that says, “I know I’m right on this, dammit!” Bottom line: You can’t keep emotions out of the picture, but you can learn not to let them control your decisions. To most people, being right is more important than making money. Here’s the deal. The way to make real money in the Forex market is to cut your losses short and let your winners ride. In order to do that, you have got to accept that some of your trades are going to lose, cut them loose and move on to another trade. You’ve got to accept that picking a loser is not an indication of your self-worth; it’s not a reflection on who you are. It’s simply a loss, and the best way to deal with it is to stop losing money by moving on, and really move on. Moving on means you don’t keep a running total of how many losses you’ve had, that’s the way to paralyze yourself. This brings us to the next point: Losing traders see loss as failure. Winning traders see loss as learning. Winning traders see loss in a certain way. They haven’t failed; they’ve learned something new about the way that they and the market work. Winning traders can look at the big picture while playing in the small arena. But how do you

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keep on trading when you’re losing in trade after trade? Simple, just remember that one trade does not make or break a trader. Focus on the trade at hand, follow the triggers that you’ve set up, but define yourself by what really matters - the overall record.

What is the Best Forex Trading

Strategy?

What Is A Forex Trading Strategy? A Forex trading strategy is a set of rules which are aimed to ensure that you are trading in a way that is free of bias and the influence of emotion. Most beginner traders will look to learn a Forex trading strategy whereas more experienced

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traders will eventually move to build a trading strategy of their own. A good Forex trading strategy should look to encompass and cover for all possible eventualities which the markets may through up. In that respect, they should comprise of rules which govern, amongst other things the following: 1. Which currency pairs to trade 2. When exactly to enter and exit a trade 3. Where to place Stop Losses and Take Profit rates Forex trading strategy must always be tested against historical data (known as back-testing). Beginner traders, when looking to purchase a Forex trading system, should always ensure that the system was properly back tested and that the results are genuine. Which Forex Trading Strategy To Choose? This will depend upon your trading style. Some traders are swing traders and will look to keep positions for days, weeks or even months. Others prefer a day trading style and will be in and out of a trade within the same day. A typical swing trading strategy will look to take larger moves ranging from 100-300 pips over a period of a few days or weeks. On the other hand, an intraday Forex strategy looks for smaller opportunities ranging from 25-50 pips. Forex scalping strategies have become popular of late as well. Scalping is a trading style which looks to take profits on very small price changes, usually soon after a trade has been entered into and becomes profitable. It is a strategy that does not look to capture 50+ pip moves; rather it is more about watching the price and getting in and out of trades for quick 5 pip moves which little by little add up. While this

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might sound risky, it can be quite a low risk strategy if performed correctly. As with all trading strategies, the most important parameter which has to be addressed here is money management. Having a strict exit strategy and rules on how much of your equity to risk per trade must be clearly outlined.

7 Steps to Choose a Good Forex

Broker

The more we live the more we find out that we are dependent on many things besides our brain. Smartness will only get us so far, but unless we make use of systems set up for our convenience we are apt to fail. This is so with the Forex market. The way how the market works means we

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have to work through a broker to get our trades started and completed. You can find Forex brokers in every part of the world just as you will find currencies traded in almost every corner of the globe. However, you should consider a few points when you go out shopping for the right broker to help you with your trades. 1. Qualifications. Probably the most important thing of all is ensuring the Forex broker you use has the correct qualifications. Therefore, choose a broker registered with the Commodity Futures Trading Commission (CFTC) as a Futures Commission Merchant (FCM). This means that you have legal protection against any abusive trading practices and scams that may arise. 2. Is the broker regulated? This means that when you sign up to use their services you will have protection and insurance against any internal fraud. Also, your funds will remain separate from the broker's operating funds. 3. What business model does the broker use? Some brokers are market makers while others are ECN brokers, providing a dealing desks for many traders. 4. Look at the types of spreads they offer. The spread is the difference between the bid and ask prices of the currencies you trade. Brokers do not make a commission on your trading, instead they take the spread as compensation. Your broker may also offer fixed or variable spreads, and they can be different for large accounts and mini accounts. 5. Slippage. Can they provide you with details of just what slippage they would expect to occur during normal and fast moving markets?

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6. Margin requirements. What is their margin requirement? That is, what percentage of the investment in your trades do they expect you to pay to open a trade. You also want to know about their margin calls, and the time you need to respond to such calls. 7. What is their Rollover Policy? Do they have any minimum margin requirements which they use to earn interest on any overnight positions? Plus, do they have any other requirements or conditions about you earning interest on any rollovers? Once you have done your research and have selected one or more Forex brokers, then it is time to set up your trading account. When your funds are credited you can start trading. Remember to read carefully the trading instructions to know how the broker can help you manage your trades. If you overlook some relevant details, you can lose money on your first trade. So take the time to read the details and ask the brokers or their support staff any questions you may have before you open your first trade.

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The Best Online Forex Brokers

Comparison and Reviews

In the brokers comparison table below you will find the oldest and the most popular brokers in the market. We have researched and picked up only regulated brokers with the most positive feedbacks left by their clients:

Broker Min Deposit Bonus Free Demo

$50 Yes Yes

$100 $1,200 Yes

$200 Yes Yes

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If you want to learn more about the brokers, below you will find their detailed reviews that will help you choose the best broker for you to trade in the Forex market. eToro Review:

eToro is the biggest social investment network in the world. The company has developed a unique Forex trading

platform, fitting both novice and experienced traders alike. Its user friendly trading interface, and various trading features make the vast world of Forex trading accessible to new traders. eToro is one of the most popular trading communities in the world. eToro is one of the most popular trading communities in the world. You can chat with other traders, see how they trade, follow them and even copy their trading positions. eToro is by far the perfect choice for novice traders who want to learn how the best traders are trading and improve trading skills.

Click here to join eToro now >> AvaTrade Review

AvaTrade is one of the world’s leading Forex broker. The company is dedicated to creating the best trading conditions

and ultimate trading experience to its customers. With 24/7 professional support, 3 different trading platforms and high level of funds security, AvaTrade is built to give the

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individual trader a full range of trading tools and instruments for your successful trading. AvaTrade is a great place to grow from a novice trader to a professional Forex guru. A friendly interface, free live webinars, trade leader’s investment program and free Forex trading course are available to increase your trading experience and help you reach high results when trading Forex online.

Click here to join AvaTrade now >> Anyoption Review

Anyoption™ is the world's first, most professional and most reliable binary option trading platform with hundreds

of thousands of loyal users from around the globe. Anyoption’s website and mobile application offer exciting ways to make big, fast profits. Anyoption is an advanced trading platform for binary options and other innovative derivatives, allowing customers to trade and profit from fluctuations in financial markets, whether positive or negative. Traders can earn huge profits within minutes, with a simple click of a button. No experience is needed as the products are suitable for professional traders and beginners alike. Trading is available even when markets are closed, and profits can be as high as 380% per trade!

Click here to join Anyoption now >>

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Special Bonus:

How to Succeed in Forex without

any Skills and Experience

Today many people start trading Forex with a purpose to increase their income and make more money. In order to trade successfully you need to analyze graphs, be updated about important events and news of the world’s economy. It is not a secret that Forex trading is not an easy job and involves high risk of losing money if you don’t know what you are doing.

How to trade like a PRO from the day 1

If you are one of those people who is looking for the best way to invest your funds for profits without trading

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experience and skills, eToro CopyTrader would be the best solution for you.

eToro CopyTrader tool is absolutely revolutionary. With CopyTrader, you can follow other traders and copy all their trades with a single click of a mouse. Instead of reading news and spending much time with the technical analysis of the charts, you just automatically COPY successful traders. So all you need to do is to identify successful traders in eToro Network and then copy their actions with eToro CopyTrader. So this sounds almost as if you could copy the best chess players in the world and win every game.

How to start copying

Follow the steps below to start copy the best traders immediately:

1. Register with eToro and log in to your account. The registration is free and will take you 15 seconds to complete:

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2. Click on the PEOPLE on the top left corner of the page to see the best eToro traders’ rankings.

3. A new window with the list of the best traders will open. Here you can see the performance of the traders, how much they are making (under Gain), how many people copy them (under Copiers).

4. We recommend choosing those traders who have higher gain and higher number of copiers.

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5. Click on the name of a trader to open his/her profile and then press the COPY button on the left.

6. In the new opened window set up the amount you wish to copy your trader with and press the button COPY TRADER. (You need to have at least $50 in your trading account. You can use up to 20% of your balance to copy a trader.)

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7. Your CopyTrader is set up. You can view the performance of the copied traders in your account in real time, anytime.

eToro CopyTrader will automatically copy all trades that your copied trader will open and close. You will make as much as your copied trader in percentage ratio. For example if the trader you copy makes 68% profit a month, you will make the same profit automatically. Imagine how amazing it is to trade like a PRO without analyzing any graph!

Click here to join eToro CopyTrader now >>

THANK YOU FOR READING AND GOOD LUCK IN TRADING!

BY Forex Trading In Singapore, 2015