When you choose to engage in forex trading, you’ll quickly come to understand that it pays dividends to make use of any and every tool that is available. These tools should help push forward your trading strategy, improve your output, and effectively help generate more profit. Looking at what could very well take your forex trading efforts to the next level, forex trading signals happen to be something that no active trader can really afford to ignore.
Signals are electronically transferred titbits of information that you can receive via email, SMS, text, and—in some circumstances—even via social media platforms. This information often represents critical need-to-know data related to the market. In many ways, a signal is an on-the-fly update that you can incorporate into the forex trading decisions that you make.
Not signed up for Valutrades free signals yet? Join today.
Read MoreTechnical analysis is the study of actual movements in the price of a financial product. However, in my opinion, technical analysis is less about trading and more about the study of mass psychology. We study the way people react in certain situations in the market, which is quite prevalent when identifying and trading using chart patterns.
Read MoreAs you probably already know, the forex market is open and active 24 hours a day, seven days a week. Traders can log onto a trading platform at any time to move currency around, but this doesn’t necessarily mean that people should be trading around the clock.
When trading forex, timing can often be everything, as there will always be good times to trade and not-so-good times to trade. To ensure that you only trade at the optimum moments, the following details the best times to trade forex, along with the times when it’s well worth staying away from the market.
Read MoreThe relative strength index, or RSI, is a price momentum indicator in the same family as the moving average convergence divergence (MACD) and stochastic oscillator. Like other momentum indicators, the RSI is charted on a separate graph adjacent to price and has an oscillator range between 0-100. Most traders use the RSI to identify overbought and oversold market conditions and locate trade entry and exit points, but it can also be used as a divergence indicator.
Read MoreThe moving average convergence divergence (MACD) is a popular indicator that can be used to confirm trend strength, direction, and momentum. Whereas other indicators are simply added to a price action chart, the MACD is charted on its own adjacent graph.
As its name suggests, the MACD leverages a moving average variation called an exponential moving average (EMA). As opposed to its close relative, the simple moving average (SMA), the EMA is a weighted average that places greater mathematical significance on the most recent data point in a given set.
Due to this difference, EMAs tend to be more sensitive to small market changes than SMAs—though greater sensitivity often comes at the price of greater volatility.
Read MoreWhen you choose to trade forex, the key to finding success is often reading patterns. When patterns are discussed, you are going to hear one name mentioned pretty consistently: H.M. Gartley. His harmonic patterns have been famously linked with chart reading and carry as much use today as in 1935 when they were first detailed in his book, Profits in the Stock Market.
Although there are several harmonic patterns of note—see bat, crab, shark, and Gartley patterns, among others—butterfly patterns remain the most prominent. A complete breakdown follows to help you get a full grasp on what they are, how they work, and how to make use of them.
Read MoreWithin the forex market, there are traders known as position traders (sometimes referred to as “buy and hold” traders), who take positions for the long term. They base this on long-term charts and macroeconomics, and they operate in pretty much every market there is—including the hyperactive forex market.
Considering how the popularity of position trading is growing, it’s worth putting this market approach under the microscope. Here’s a look at the details behind position trading, along with how common traders use positions.
Read MoreWhen it comes to trading, it is widely accepted that there are two main approaches to your analysis of potential trades. They are fundamental analysis and technical analysis.
Technical analysis is widely used by private traders and is becoming more and more popular. It involves the study of a financial product’s actual price, to form an opinion on the likely future direction in which the price will move.
Read MoreMoving averages are one of the most popular tools that forex traders lean on when attempting to understand market movements because they add an extra layer to any chart analysis you’re conducting, highlighting exactly where the price action is happening.
Based on pure popularity, the exponential moving average (EMA) and the simple moving average (SMA) are the two most common moving average tools. But there are differences between the two.
Read MoreMargin and margin requirements are something that no forex trader can afford to ignore. Margin has often been labeled a “good faith deposit” to open a position.
Margin is usually presented as a percentage amount of the full position, 0.25%, 0.5%, 1%, 2%, and so on. You can calculate the maximum leverage you can use with your trading account based on the margin required by your broker.
Read More
