What Thomas Edison Can Teach You about Trading Forex.

Thomas Edison is one of the biggest inventors we know. His inventions made big improvements and progressions in human life. They say he has more than 200 inventions. Was he genius? Definitely he was not an ordinary person but this is not his success secret. There are thousands of genius people but they have not and will not make any changes in anybodies life - even themselves.

What made Thomas Edison a different person? How can you copy him in your life and business? What you can learn from him to improve your Forex trading business?

Let’s know Thomas Edison more through his quotes and I will tell you how you can follow him in forex or any business that you have.

1. Work Smart

“Being busy does not always mean real work. The object of all work is production or accomplishment and to either of these ends there must be forethought, system, planning, intelligence, and honest purpose, as well as perspiration. Seeming to do is not doing.”

Maybe Thomas Edison knew nothing about the way that we trade forex these days but as you see he talked about having system and planning. Sitting at the computer and looking at the charts doesn’t mean that you are trading or learning forex. You should know what you are doing and what are you waiting for.
If you sit at the computer for several hours per day and you still have no special system (strategy) or you have not learned enough or you have an incomplete knowledge about the forex market and forex trading, then you are wasting your time and money.
2. Work and Wait

“Everything comes to him who hustles while he waits.”

It seems so easy to make money with forex when you just start learning it. Maybe your first few trades with the demo or real account were successful trades and this has made you think that forex is the easiest way to make money. But after a while that you see the other side of the forex market coin, you will get realized that something that you make in several days can be lost in less than one hour. And you will get realized that forex is not easy and it needs learning and hard working.
There are a lot of people who give up after losing some money but only those who follow the right direction consistently and seriously will become good forex traders finally.
3. It Takes Work

“Genius is one percent inspiration and ninety-nine percent perspiration.”

Deciding to learn forex and having enough talent to learn is just the beginning. To become a successful trader, it needs hard working and seriousness.
4. Failing Takes You Closer to Succeeding

I have not failed. I’ve just found 10,000 ways that won’t work.”

You try several different systems, time frames, currency pairs and … to find something that works for you properly. When you see a system doesn’t work for you, don’t think that you have not been able to use it and make it work. Just look for a better and easier system.
When you see that you have not made any money through forex after several months of practicing, don’t think that forex doesn’t make any money or it is impossible to make any money through forex. Be like Thomas Edison. Don’t give up and try more.
5. Don’t Give Up Too Early

“Our greatest weakness lies in giving up. The most certain way to succeed is always to try just one more time.”

Yes! Try one more time any time that you fail. Learning forex is all the matter of practice and gaining more experience.
6. Make it Fun

“Our greatest weakness lies in giving up. The most certain way to succeed is always to try just one more time.”

Do you enjoy trading forex? If you learn or trade forex just because you have to make money, you will not become a good forex trader. You have to take it seriously but you should not do it if you don’t like it. You should not trade forex if it seems boring to you. Try to enjoy it in the way that you enjoy a computer game.

Learn Some Trading Tips from Albert Einstein.

I am sure all of you have heard about Albert Einstein. Probably he is one of the most famous scientists who created a big revolution in the scientific world and opened several new gateways of research and development. Theory of relativity, founding of relativistic cosmology, the prediction of the deflection of light by gravity that was later ended to understanding of black holes, the quantum theory of atomic motion in solids, the zero-point energy concept, the quantum theory of a monatomic gas, and… are only some of the things that he has done. But does Einstein have anything to teach us about trading? Yes, he has 8 amazing trading lessons.
1. Persevere
“It’s not that I’m so smart; it’s just that I stay with problems longer.”
When you read the above quote, you may think that Einstein just tried to look humble and down to earth, because everybody thinks that Einstein was a genius. He really was a genius but at the same time humble and down to earth, however do you think even a super genius can do anything if he/she just ignores the problems, gives up and walks away? Definitely not. The top secret is, to do something extra ordinary, you do not need to have an extra ordinary IQ. You need to be a hard working and focused person. There are so many genius people who come to this world and go without doing anything important and useful. But there are so many ordinary people who focus on something and make a big positive change finally.
You can not achieve anything overnight. It takes time to become a good trader. If you like to become a good trader, you also have to spend time on trading. There is no holy grail, nor a magic system or robot that can make you a millionaire trader within a short time. The holy grail is you and the experiences that you gain and experience can be gained through working and “staying with the problems longer” as Einstein says.
2. Focus:
“Any man who can drive safely while kissing a pretty girl is simply not giving the kiss the attention it deserves.”
Staying with the problems is not enough. We have to focus on them. In trading, “focus” doesn’t mean over-trading. You can trade 30 minutes per week only. But be focused during that 30 minutes. Also do not distribute your time and energy on trading so many different currencies, stocks, CFDs through so many different trading strategies and systems. You can not focus on several things at the same time. Novice traders think that analyzing several different markets and finding as many trade setups as possible is the best way to make more money faster and sooner. It is such a big mistake. Most of those who think so are among the traders who will give up finally.
3. Create Value:
“Strive not to be a success, but rather to be of value.”
In trading, success means profit and profit is the value of the work of a trader. “Profit” can be made only by having more “successful” trades and successful trades can be acheived only by finding valuable trade setups that do worth taking the risk.
That was very easy to understand, right?
4. Be Curious:
“I have no special talent. I am only passionately curious.”
You do not have to have any special talent to become a good trader. You just need to learn a trading system and wait for the trade setups. Trying to be too smart makes you lose, because the market is smarter than you. Just learn a simple trading system and be curious for the trade setups. That is all that makes you a good and profitable trader.
5. Make Mistakes:
“A person who never made a mistake never tried anything new.”
During the past a few years that I have been in touch with so many forex traders through my website, I have seen so many novice traders who start very passionately and eagerly but give up so easily by losing the first trade or blowing up their first live account. Obviously, most of these people will never try the trading anymore and will lose the chance of making any money through the forex market, for the rest of their lives.
On the other hand, most of the successful traders that I have seen, have been able to achieve their success through a very hard way and losing a lot of money, before finding the right way. I am not saying you should also lose a lot of money to become a successful trader finally. In fact, I believe one can become a good trader through losing the minimum amount of money, if he/she learns and follows the money management rules first.  What I am trying to say is that you learn some of the lessons from your own mistakes and if a mistake causes you to lose money, you should not give up. If a losing trade tells you that you should have a proper stop loss, take it as a good lesson and never take any position without a proper stop loss anymore.
6. Don’t Be Insane:
“Insanity: doing the same thing over and over again and expecting different results.”
Are you still losing because of having no stop loss in your trades, working with an improper time frame, trading with an unreliable platform or broker or following a useless trading system? If you answered yes, then the next question is why you expect a different result by repeating the same thing over and over?
If you lose because you do not set a proper stop loss or you do not follow the money management rules, or because you still do not have a proper trading system or you try to make money through a time frame which is not for you (it is either too fast or too slow for you) then why do you still do it?
If you answered “Because I am insane!”, then you should expect more losses
7. Expect Opposition:
“Great spirits have always encountered violent opposition from mediocre minds.”
Probably you are blamed by some people after losing some money in the forex market or any other businesses that you tried to run and develop. Discouraging words can stop you at anytime, but if you stop, then you’d better not to think about making any changes in your life and just leave yourself to the events and chance. Pessimistic, negative, jealous and according to Einstein, mediocre people are always around. If you want to be one step ahead of the mediocre minds, you should do something more than ordinary and usual and you should not listen to those people.
Since the time that I have published the $53,000/month article, I have been criticized or even accused by some “mediocre minds” who did not even bother to read that article carefully just once to see what it is about exactly. But I always had one answer for them:

George Bernard Shaw:
People who say it can not be done, should not interrupt those who are doing it.

Just do whatever you think is right to do. It doesn’t matter if you are wrong. You will become a more experienced person, when you find out that you were wrong. If everybody wanted to think like these “mediocre minds”, now we still had to cover our body with the plants’ leaves
However, keep in your mind that in trading you should always limit your risks by having a good money management plan. Do not let the first mistake be the last.
8. Learn the Rules, Play Better:
“You have to learn the rules of the game. And then you have to play better than anyone else.”
You have to learn the rules of your trading system. Then you have to wait for them to occur. If you sit at the chart while you still don’t know what you should wait for, or if you are used to enter the market while you have no answer if I ask you why did you take this and that position, it means you still don’t know the rules of the game.

The big secret behind gold's collapsed.

If you have been watching gold, I don't need to tell you how fear-filled this market is right now.Watch Adam's analysis on  this emotional market using our "Trade Triangles," the Williams%R, and the MACD indicator. 
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New Video - A look at 5 Energy Markets..

Today's video is a little different than usual. It covers energy markets and is a lead in to
tomorrows webinar. As many partners know webinars are a very successful sales tool. They giveviewers an inside look at our service, a chance to ask Adam questions directly and
a look at how we can give them added value.
         This webinar will be on our energy portfolio, more specifically how MarketClub users can easily follow along and profit from yet another part of our service they didn't even know existed.
            The video    http://www.ino.com/insider/?affid=CD4414

Click here to download "Think and Grow Rich"

Click here to download "Think and Grow Rich"

Turtle Trading Rules That Made Over $100 Million!

Richard Dennis was a small time trader who started trading commodities with only $300 and ended up making more than $150+ million. In early 1980s, he gathered a group of individuals who had little prior experience of trading and trained them to trade commodities with his trend following methods.
Over the next few years, his students became famous as the Turtle Traders and as a group made over $100 million following his Turtle Trading Rules. These trading rules are not difficult to understand and master. These trading rules that are generally based on Richard Donchian Channel Breakout Methods are pretty simple to follow. These were the entry rules for the Turtle Trading System;
Turtle Trading Shorter Term;
Enter into a long position on the breakout above price high of the preceding 20 days. In the same manner, enter into a short position on the breakout below price low of the preceding 20 days. If it was a true breakout, it will result in a winning trade. If it was a false breakout, the current breakout signal could be taken.
Turtle Trading Longer Term;
Enter into a long position on the breakout above the high of the preceding 55 days or enter into a short position on the breakout below the low of the preceding 55 days.
Those turtles who followed the above two turtle rules rigorously without any emotions made over $100 million profit as a group while those turtles who did not follow these rules religiously and allowed their emotions to come into play when making their trading decisions did not do well.
Richard Dennis used to say that he could publish his rules in the newspaper but it won't make any difference as long as the person who used them applied them with discipline and without emotions. Basically, these rules tell you how to trade channel breakouts. Richard Dennis made his fortune trading channel breakouts. Channel Breakouts are frequent in the currency markets. You can adopt these rules to the currency market as well. Download the Turtle Trading Rules FREE!

Why fear and greed will wreak havoc in your life.

Hey,
 
Whenever I hear or read about how 95% of forex traders lose money on the market two words spring to mind: Fear and Greed. I consider these two, all too human, emotions to be the worst enemies of any trader, capable of wreaking havoc in any account, no matter what size or how experienced.

Why do fear and greed play such a big role in the psychology of traders? The reason is Money.

After all, Money is the reason why anyone gets into trading financial markets in the first place. It is the (achievable) goal of making more money with as little work as possible. This is Greed, because you wish to make more and more over and over again.

The problem is that there also is an inherent risk in trading forex. The risk of losing money exists every time you enter into a trade. It can go your way (you make money) or the opposite way (you lose money).

Losing money is something no-one wants or enjoys. In fact, it can be downright scary as money buys us food, keeps a roof over our head and contributes to the overall sense of safety for ourselves and our family. This is where Fear comes in, the fear of losing money.

The fact that these emotions exist is not a problem in itself. The problem is that they are capable of playing with a trader's decision making process by eliminating logic and common sense. They
can cause irrational trading decisions.

Here are two examples of how Fear and Greed can interfere with your decision making:

- Example 1
Let's say you're into a trade and it goes against you. You set a Stop Loss as the trading strategy recommended. But now you are having second thoughts. You don't want to admit this trade may close at a loss because you are Greedy.

You want this trade to make money. You act irrationally and move the Stop Loss, giving the trade more room to go against you.

Finally, you end up closing the position at an even bigger loss than you should have suffered. Why? Greed.

- Example 2
On the other hand, let's say you are into a position and it's going in your favour. It is now a small profit. You've already set a higher Target Profit so you leave the trade to run further.

However, now Fear grips you and you begin fearing that unless you take this profit while it's still there, you will end up losing it.

This causes you to close the trade at a small profit and you end up missing out on a bigger profit as the trade could have earned more for you.

To be a successful forex trader you have to learn to control your emotions. Until you do that, you will never join the 5% of successful traders.

In the next email I will give you the top six secrets to mastering fear and greed, and turning them to your advantage.

In the meantime, why don't you join me on Twitter?

http://twitter.com/Alberto_Pau

Yours,
Alberto

Trade Balance.

The Trade Balance is a balance between exports and imports of total goods and services. A positive value shows trade surplus, while a negative value shows trade deficit.  If a steady demand in exchange for exports is seen, that would turn into a positive growth in the trade balance, and that should be positive for the Currency.

Start small...and make as much as you want.

	Hi,This is the e-mail.i got from alberto.very useful and knowledgeable for traders. I wanted to email you today and touch back on the importance of starting with a small investment in the forex market before going for the big bucks. I know starting to trade the currency markets can be daunting with big numbers being made every day. It's a tough market where you can make (or lose) a lot of money very quickly. Sometimes you feel like you can't participate in the market as you just don't have big amounts of cash...people often think that in order to trade the currency markets successfully you need to have a lot of money to start with. Believe me, nothing could be further from the truth. The reality is that if you never start investing (and trading) in the forex markets you will never learn how to do it and profit from it, nor will you ultimately have the money to make a living out of it. A big mistake many wanna-be investors make is to wait until they have $100,000 or $50,000 to start thinking about ways to invest their money. This is a mistake because of the very fact that one of the main components of a trading strategy is time. Sure, you will need some capital and a profitable investment strategy to start trading the markets. But most importantly you need a strategy that you can start implementing with a small amount of money today, so that if something doesn't work out as planned you don't lose a big amount of money. For example, you may decide to invest in the forex market by buying the EURUSD (buying EUR, selling USD). The return on your investment will be the result of the price movement by the amount invested. So if you open a long position with $100 and EURUSD appreciates by 2%, you make $100 x 2% = $2. However, if EURUSD depreciates by 2%, you only lose $2. If your "up" days are more than your "down" days, you could easily be achieving returns of over 20% per month (in the next few emails I will tell you more about identifying those strategies). If you implement a strategy that only allows you to deal in minimums of $100,000, on a down day for a 2% unfavourable move you can be losing $2,000! If this happens more than a few times you can easily be looking at losing all of your initial investment. So when you start trading a new strategy you want to start small, so that if things don't go as intended you haven't lost a lot of money and have your initial investment in your bank account. Having a lot of money to start trading forex is not as critical as having a profitable strategy that is quick and easy to understand, as it will allow you to test different alternatives and ultimately make a living from it. This strategy can be invented by you, based on your own knowledge of the markets, or you can take advantage of the strategies used by the most successful traders in the field. Don't forget to add me on LinkedIn! http://uk.linkedin.com/in/albertopau Stay tuned...in my next email I will tell you more about how to identify an easy to learn and fast to implement trading strategy... Alberto

Fibonacci retracement.

Fibonacci retracement is a very popular tool among technical traders and is based on the key numbers identified by mathematician Leonardo Fibonacci in the thirteenth century. However, Fibonacci's sequence of numbers is not as important as the mathematical relationships, expressed as ratios, between the numbers in the series. In technical analysis, Fibonacci retracement is created by taking two extreme points (usually a major peak and trough) on a stock chart and dividing the vertical distance by the key Fibonacci ratios of 23.6%, 38.2%, 50%, 61.8% and 100%. Once these levels are identified, horizontal lines are drawn and used to identify possible support and resistance levels.                                                                                                                                                                                                          

FX Option Volatilities What are they?

FX option volatilities measure the rate and magnitude of the changes in a currency's price. Implied option volatilities measure the expected fluctuation of a currency's price over a given period of time based upon historical fluctuations. Volatility is measured by calculating the past annual standard deviations of daily price changes. Volatility is one of the key components of option pricing. Higher volatilities generally make option premiums more expensive. Professional option traders will typically buy options when volatilities are low and sell options when volatilities are high. Traders who only trade volatility need to hedge their options by buying or selling spot foreign exchange.

How is it used in Foreign Exchange?

When option volatilities are low - Look for a potential breakout When option volatilities are high - Look for range trading opportunities

Option volatilities are useful in timing FX movements. When currencies range trade it is likely that implied option volatilities are declining. The reason this happens is because range trading means lack of movement, by definition. When option volatilities have a pronounced movement downwards, this is usually a good signal for a significant upcoming movement and this is very important for both range and breakout traders. Traders who usually sell at the top of the range and buy at the bottom, can use this tool to predict when their strategy will stop working. Breakout traders can monitor option volatilities to make sure that they are not buying or selling into a false breakout.

The EUR/USD and GBP/USD charts on the following page contain examples of when sharp drops in option volatilities have predicted large moves in the FX market. These specific examples highlight upward movements, but are equally as useful for the inverse. In April of 2003, EUR/USD 3 month implied volatility took a sharp plunge downward when EUR/USD was trading within a tight range. If a trader bought EUR/USD based upon this move in option volatilities, he would have been in the market for the 700 pip move that occurred during the following 3 months.

There is also a case for GBP/USD. In April of 2003, option volatilities plummeted from 8% to 7.3%, while GBP was range trading. In the following months, GBP/USD rallied from 1.5550 to 1.6100. This strategy generally works well, but traders must be cautious because volatilities can have long downward trends. This is evidenced in the period between June 2002 and October 2002. Therefore, it is important that traders look for sharp movements in volatility as opposed to gradual ones, because declining volatilities can be misleading.

Buy the Strongest, Sell the Weakest.

One important tool FX traders can use in their analysis is the concept of relative strength. I'm not referring to the technical indicator RSI, but rather a comparison of the currencies to determine the strongest currency and the weakest currency. Once we identify those currencies, we can match them up and check the pair that includes both currencies and we should see a strong trending market.

Here are six 4-hour charts of different EUR pairs. The first thing we should notice is that the EUR has been moving up against all of these currencies for almost a week now. Short-term traders have many possibilities when looking for buys in that the EUR has been strong across the board. There is one exception though, the EUR has struggled against the GBP when compared with the other pairs. While those short-term traders might avoid buying the EUR/GBP, longer-term traders might find that information valuable too. Since the longer-term trend of the EUR has been down, some traders are looking for the EUR to reverse back to the downside. Noting how strong the GBP has been against the EUR on this move up could very well lead to a stronger move down if these markets do reverse. That might mean that selling the EUR/GBP on a reversal could offer a better chance of success than selling any other EUR pair.

Simple comparison between currencies can be done quite easily in the FX markets because of the match up of each currency with another in the pairs we can trade at FXCM. This is an edge to trading FX and is a valuable tool for FX traders.

Limit Entry.

Limit Entry (LE) Orders are orders to enter the market at a more favorable price. For example - if we were buying a currency pair, a Limit Entry order would be below the current market price. Only if the market went down to that price, would the order be able to be filled. If placing a LE on a short trade, entry price will be above current market price.

What’s the best way to determine if a pair is trending?

Instructor’s Response:

Thanks for your question on this very important topic.Take a look at the historical daily chart of the EURUSD below...

A pair on a lower time frame chart may appear to be trading in a range. So, to gain more insight I like to look at the bigger picture and consult a daily chart.

As can be seen on this chart, this pair demonstrates the most compelling signs that the pair is trending to the upside: it is building higher highs and higher lows. On the other hand, a pair that is in a downtrend will be building lower highs and lower lows.

Once the overall trend has been identified, the trader can then take advantage of that trend by only taking trades in that dirction.