Review Category : Trading Tools

Secrets You Should Know About Foreign Exchange Sydney

foreign exchange Sydney

As is the case with anything that becomes extremely popular, the forex market has also gathered various myths and misconceptions. Many new traders enter the market with these misconceptions in their heads, which almost always causes them to falter and suffer huge financial losses.

Naturally, there is a need to dispel some of these misconceptions about the foreign exchange Sydney. If you are also new to the forex market then do not be surprised if some of the following misconceptions are also a part of your forex belief system. Instead, try to remove them from your mindset so you can improve as a trader on the foreign exchange in Sydney.

Brilliance

The biggest misconception that traders on the foreign exchange Sydney hold fast to is that successful traders are exceptionally brilliant and intelligent. They think that successful traders are geniuses who can churn out numbers and grasp concepts in the blink of an eye.

This is not true. The main reason why successful forex traders are successful on the foreign exchange is that they have the right mindset.

Mindsets

It is common for new traders to discuss how difficult it can be for a human being to trade on the foreign exchange Sydney because he is always susceptible to emotions.

While it is true that emotions are a part of human beings, it is also true that people have the ability to control their mindsets. Success on the foreign exchange is about having the right mindset and you need to believe that it is possible.

Percentages

The source of this misconception is unclear but it exists nonetheless. Traders believe that they need to see their account capital, losses and profits in terms of percentages.

They tend to refer to their growth and reduction in terms of percentages. Percentages can be very misleading and can also prevent you from being honest to yourself. It is better to see things in terms of how much risk you took and what rewards you got.

Time

Most forex marketers try to sell that it is very easy to get profits from the foreign exchange Sydney and can be done in minimal time. On the contrary, forex trading can be a complicated line of work. Therefore, the more time you spend learning about it the better you will be at gaining profits.

Stability

The image that many new traders have of successful traders is that they live larger than life, have a lot of money, and are either always excited or depressed. In contrast, most successful traders are extremely stable and consistent individuals who follow a simple routine every day to make the kind of profits that they make off the foreign exchange Sydney.

Tools

Another misconception that can be traced back to marketers on the foreign exchange Sydney is that robots, expert advisors, signalling software programmes and the like are better at trading than an individual can ever be. This is a gross misrepresentation which makes new traders spend a lot of their time looking for and trying such tools.

 

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Reviewing Forex Brokers: Easy Forex

forex brokers

Finding forex brokers is not difficult. Finding good forex brokers, however, is another thing entirely. The importance of finding the right forex broker cannot be understated in any way. A poor choice of broker has ended up to be the downfall of many traders in the market.

One broker that should suit most traders’ needs is Easy Forex. The company has constantly improved its services since its inception and currently is one of the few Australian forex brokers that can stand with its head held high. Here is a review of Easy Forex so that you can decide for yourself whether you want to tie down with them or not.

Overview

Easy Forex was established around a decade ago in 2003. It is one of the few brokers active in the Australian market that are actually headquartered in the country. Easy Forex operates out of its office in Melbourne, Australia. It offers a wide range of platform options along with many other benefits to traders that choose to work with it.

Basic Facts

Before you include or disqualify any forex brokers from your shortlist, you need to consider various aspects of their operations. Easy Forex would allow you to open an account for as low as 25 American dollars but would give you a bonus of 200 American dollars the moment you open your account.

The leverage you would get with Easy Forex would be to the tune of 1 to 200. Furthermore, the spreads are tight, sometimes going as low as just 2 pips.

Trading Platform

In terms of trading platforms, Easy Forex, like many accomplished forex brokers in the market, would give you access to a desktop platform, a web platform, and a mobile platform. In addition to this, if you are one of those traders that like Meta Trader then that is also an option available with Easy Forex.

The way Easy Forex’s platforms are designed makes them suitable for all types of traders ranging from the beginners to the experts. Furthermore, there are considerable customisation options which can be used by those traders who are more specific about what they need.

Unique Qualities

There are also many unique qualities that Easy Forex offers. For instance, unlike many other forex brokers, Easy Forex does not place a maintenance margin on its traders.

Furthermore, it also offers the freeze rate facility which is extremely useful for new traders who want to consider their position one last time before confirming them. The freeze rate facility can be a tool of verification which is highly beneficial for beginners.

Customer Support

Traders can contact the highly professional and capable customer service personnel of Easy Forex round the clock, all days in a week, as is the case with most reputed forex brokers.

Furthermore, the company also offers dedicated managers, telephone connectivity, quick email responses, and even an online chatting module that can be used to resolve technical and trading related problems.

Easy Forex is a well known name that holds its own amongst the wide Australian landscape of highly qualified and reputed forex brokers.

 

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Reviewing Forex Brokers: AvaTrade

forex brokers

The forex market has grown to such a point that now there are numerous options to choose from regardless of what product or service you are looking for. However, the most variety in the forex market is available in the category of forex brokers.

Owing to the fact that brokers with the right licence can operate all over the world while being based in one country, the number of options available to individual traders has increased consistently in the last decade or so.

Despite the cutthroat competition, one of the names that has actually stood out is AvaTrade. Here is a review of this well known name amongst forex brokers and traders alike.

Overview

AvaTrade is a truly multinational company that has offices in six different countries apart from Australia. These countries are Japan, China, Ireland, Mongolia, France, and Italy. It was established in 2006 and after a period of steady consolidation it quickly rose to the top of the forex broker list. In fact, in the last four years alone, AvaTrade has managed to receive nine different industry awards.

Basic Facts

AvaTrade manages to be a good solution for all kinds of traders looking for forex brokers i.e. seasoned and novice. It is an extremely flexible service provider which is what allows it to cater to such a variety of clients.

The maximum leverage that AvaTrade provides is to the tune of 1 to 400. Along with this, the minimum deal sizes AvaTrade offers is 5, 000 units, which is limited by margins.

Furthermore, the minimum deposit that AvaTrade would require from you would be 100 American dollars.

Trading Platform

The platforms offered by AvaTrade can support up to 12 languages including Arabic, Russian, Japanese, Spanish, German, Italian, Portuguese, French, English, Chinese, and Taiwanese.

Like most high quality forex brokers, AvaTrade also offers many trading platforms including the industry favoured Meta Trader, its own proprietary platform designed for beginners, and a web based platform. In addition to this, a mobile trading platform and integration with social trading websites are also available.

Unique Qualities

As is the case with all other forex brokers, there are many extra features that AvaTrade offers. For instance, AvaTrade boasts of high quality educational resources that new traders can avail in the form of webinars and eBooks.

Furthermore, it has a live news feed system. Finally, what truly sets AvaTrade apart from other forex brokers in the market is that it offers an AvaTrade debit card which can come in very handy.

Customer Support

AvaTrade is a well known name and the reason for this is simply that the numerous traders it caters to are satisfied with its services. It achieves this with great customer service. AvaTrade can be reached by various media such as emails, chats, and, as is obvious, the telephone.

Most of AvaTrade’s customer service executives are courteous, professional, and know enough about forex trading to be able to help even the more experienced traders.

 

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Reviewing Australian Forex Brokers: XE Markets

Australian forex brokers

The forex market is vast in size and value. Its size makes it very easy for forex traders to find services that suit their needs. For instance, if you are based in Australia and are looking for Australian forex brokers then you would not only be able to choose those brokers who are based in Australia but also brokers from other countries.

However, too many options can also make it difficult to find the right services. If you are looking for Australian foreign exchange brokers then it is likely that you have come across so many options that you do not know which one to trust. One name worth considering is XE Markets. Here is a review.

Overview

Even though XE Markets is based in Cyprus, it caters to traders from all over the world. Moreover, it is particularly popular in Australia. The company, which came into being in 2009, is licensed by various authorities all over Europe with the most prominent one being CySec or Cyprus Securities and Exchange Commission.

Other countries where XE Markets has approvals include the UK, Germany, Spain, Netherlands, Sweden, Finland, Hungary, Italy, France, and Poland. Moreover, the company also has ties with Barclays Bank for banking purposes.

Basic Facts

XE Markets trumps other Australian forex brokers as a trader can open an account with it for as low as five American dollars. However, it would literally pay to open with a bigger deposit because XE Markets also gives a 100 percent bonus to first timers.

The leverage that XE Markets provides is also generous at 888 to 1. Moreover, its spreads are also much better than most Australian foreign exchange brokers because they go as low as one pip.

Trading Platform

Even in terms of trading platforms, XE Markets can compete with most high class Australian forex brokers. It offers three types of trading platforms to cover most traders’ needs in the shape of a desktop platform, a web platform, and a mobile platform.

In addition to this, XE Markets also has ties with the popular Zulutrader which offers social forex trading platforms. In terms of account types, XE Markets offers three types including a micro account, a standard account, and an executive. Needless to say, demo accounts are also an option.

Unique Qualities

XE Markets is unique from other Australian forex brokers in many ways. As stated above, it can offer traders maximum leverage of 888 to 1. This is not something that many Australian forex brokers can claim. In addition to this, XE Markets also offers flexibility to its traders with respect to deposits as there are various options that are available.

Customer Support

As can be expected from Australian forex brokers with international reach, XE Markets offers multilingual customer service support to its traders all over the world by means of emails and telephones. Moreover, the actual trading process is flawless with XE Markets, with deposits appearing in accounts super fast and trades not suffering from undue lag times or even requotes.

 

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Realistic Expectations from FX Rates

FX rates

The forex market has a lot to offer to those traders who have the ability and the mindset to grab what they can. However, the problem that most traders face is that they see the potential of profits from FX rates and immediately start aiming for the castle in the cloud.

They never realise that they need to first get a single room apartment before they can start dreaming about the castle with a hundred ramparts and thousand penthouses. Unrealistic expectations have been the bane of many forex traders in the past and are going to be the same for many forex traders in the future as well.

You have to make sure that you are not a trader whose efforts to profit from FX rates are not blighted by unrealistic expectations as well. How can you do this? Here are some suggestions.

Disposal Capital

Unrealistic expectations often stem from account capital that the forex trader is using. There are two ways through which you can fund your efforts to profit from FX rates. The first is that you use all the money that you have saved and the other is that you use a small percentage of your savings which becomes your risk capital.

The difference between savings and risk capital is how attached you are to it. Losing your savings would mean that your lifestyle is affected while losing your risk capital does not have such an impact on you. Therefore, if you only use disposal capital then your expectations from FX rates would become more realistic.

Risk Tolerance

You should always be relaxed about forex trading and FX rates. Thus, if you are unable to sleep at night and are wondering about your trades in the market then you may have invested so much money on the foreign exchange that you cannot relax.

You need to figure out what your risk tolerance levels are like and never overshoot them. Risk tolerance can be defined as the amount of money that you can bear to lose in the market without losing sleep over it.

Independent Trades

It is common for a forex trader to place the next trade while being influenced with their previous trades. For instance, if FX rates have given you profits in the previous trade then you may feel tempted to increase your position size in the next trade expecting more profits.

This is wrong because you need to treat each trade as an independent entity not connected to preceding or succeeding trades. If you can do this, whether you have lost in the previous trades or won profits, your expectations would remain logical.

Patient Attitude

Impatience will also lead to you having unrealistic expectations from forex rate fluctuations. When you are impatient, you want to see immediate results, which in forex trading terms mean immediate profits.

However, the forex market would go through phases where you will not see any opportunities. During these periods, you have to hold back from investing in FX rates or lower your expectations. Patience certainly helps here.

 

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Pinpointing Loopholes in Your Forex Strategies

Forex strategies

Every new trader is advised to formulate and utilise forex strategies. Most new traders even listen to such advice and choose strategies to suit their trading needs and personalities. However, choosing or using forex strategies provides no guarantee of these traders becoming successful.

In fact, the number of new traders that actually drop out of the market so consistently is the biggest proof of this fact. The reason for this is that even though new traders choose and use forex strategies, they fail to use them in the right manner. Effectively, nearly all new traders end up having loopholes in their strategies.

If you are a new trader then it is likely that this makes you unsure of your own forex strategies and that you want to make sure that yours do not have any loopholes. Here is a list of some aspects that loopholes are usually found in so that you can pinpoint them in your own strategies.

Usage of Indicators

If you have chosen technical strategies then the loophole in your strategies may be inherent in indicators. New traders tend to think that the more they analyse the market, the more accurate and successful they will be. However, using too many indicators can actually be counterproductive because it can muddle forex signals.

Risk Reward Considerations

While new traders always look for profits, they make one simple mistake. They fail to analyse their trades in terms of their chosen risk to reward ratio. The minimum risk to reward ratio that any trader should follow is 1 to 2. If you have not devised a process for assessing the risk to reward ratio of your potential trades then this may be a very dire loophole in your forex strategies.

A Trading Plan

Forex strategies are sufficient when it comes to implementing individual trades but they are difficult to implement day in day out. For this, they need to be housed within a trading plan that gives traders a routine and a schedule to follow. If you have not created a trading plan then you are most probably fairly erratic in the market and need to fix it.

Emotional Deviations

Even though no trader is completely free from emotions, regardless of his experience, new traders tend to be especially susceptible to emotions in the market. Moreover, every time they become emotional they abandon what their forex strategies advise and take decisions spontaneously. Emotions are the biggest obstacle that new traders face in the market.

Choice of Time Frames

The time frame you choose for your forex charts can have a huge impact on the accuracy of your analysis of the market. While smaller time frames tend to show a lot of noise and hide many long term trends, bigger time frames do not have such flaws.

However, longer time frames will not give you many opportunities in terms of placing trades in the market. Even so, the opportunities they do provide tend to not only be more certain but also yield big profits.

 

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Overtrading and Patience in Foreign Exchange Market

foreign exchange market

What is that one single problem that seems to bother every new trader in the foreign exchange market? What is that habit that has the potential to completely derail a forex trader’s career? The answer to these questions is overtrading. Overtrading is an extremely serious problem, not just because of its adverse effects but also because it is a problem that creeps up on traders.

In fact, most trader do not even realise that they are overtrading up until it is too late and they have lost a large part of their total account equity. Subsequently, when they do realise their mistake they spend a lot of time trying to recoup what they lost. This itself is a risky step in the foreign exchange markets.

The Problem of Overtrading

A trader is said to be overtrading in three situations. The first is that he is opening too many positions in the foreign exchange market, the second is that he is leaving his positions open for too long, and the third is that he is investing too much of his money on single trades in the market.

In the first situation, the trader finds many of his positions untenable in the market and, hence, incurs losses. In the second situation, the most common circumstance is that the trader ends up losing profits that he should have locked in and, in the third situation, the trader is one massive reversal away from taking a huge financial hit.

The Role of Patience

Most traders who overtrade in the foreign exchange market are also individuals with little patience. In fact, patience is the direct counter to the problem of overtrading. Take the situations mentioned above.

In the first situation, patience would allow a forex trader to hold off entering the foreign exchange market up until he sees reliable opportunities to invest in. In the second situation, patience would allow the trader to realise that maybe he should close his position early because the market will turn.

Finally, in the third situation, patience would help a trader invest lower sums on individual trades because he would be able to wait to meet his bigger financial objectives.

Tips To Be Patient

In order to be patient and avoid overtrading in the foreign exchange market, you will need to change your state of mind and attitude. However, if you know how to go about it, you should not find it very difficult.

Firstly, you should look to incorporate patience into your forex trading strategy and forex trading plan. This means that you should put restrictions on how much you can trade in a particular period.

In addition to this, you should constantly review your journals to see if you follow your trading plan consistently. You should also add in a punishment at the end if you do not depending on your preferences.

Finally, you need to start thinking long term in terms of the foreign exchange market. You should aim to meet your financial targets at the end of every quarter or even year.

 

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Advice on Forex Signals and Forex Trading

Forex Signals Research

When you trade on the forex market you have know about the tools you can use and the tips to help you.  When you know about this you can have a better understanding of the market and what it has to offer.  You should consider forex signals and other advice that can help you trade.  It is important that you know what this advice is and how you can implement it with your trading.

Know your Trading Style and the Strategies That Work

The trading style that you employ should fit your personality and skills.  You can find out about the different styles through training programmes and from looking at forex forums.  The best way to find the style that suits you is to looks at the trading strategies on offer.  If scalping appeals to you then short-term trading is the best options.  However, if you like to wait for your profits to be realised then long-term trading is best.  You have to consider your personality when you look at trading styles.  People who do not do well under pressure should stay away from the short-term trades.

Your Entry and Exit

When you complete any kind of analysis you will be given and entry and exit point.  You need to stick to these otherwise you could turn a winning trade into a losing one.  If you are only looking at entry points then you have to ensure all your stop loss orders are correctly placed and that you do not move them.  Traders that do this should look at trailing stops to ensure they always make a profit.

Overcome Your Emotions

While your mind is your greatest asset when it comes to trading it can also be your worst enemy.  The mind becomes an enemy when you allow it to be overcome with emotions.  Keeping the logical and analytic part of your brain in the dominant position ensure that your mind is an asset.  Emotions often cloud your judgement and when you are trading this leads to bad trades or staying with a position long after you should close it.  Keeping your mind logical and emotionless is the best way to be successful when trading.

Research Forex Signals Before Use

Advice you get from a friend or on a forex forum should be looked at carefully.  While the information may be good you should never trade based solely on this information.  Completing some of your own analysis is very important.  If you are going to be using a forex signals service then you should verify the validity of what they are telling you.  The best way to do this is through a trial service if you can get one.  If you cannot then you should consider what other people have to say about the service.

You Cannot Change the Past

When you are trading on the forex market you have to remember that there are no second chances.  If you miss an opportunity it is gone forever.  If you have made a bad trade then there is no way to go back and change it.  This is why you need a trading plan and strong control over your emotions.

 

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Using a Forex Demo Account as a Skill indicator

Forex Skills Through Training

When you trade forex you need to use a demo account before you start trading live.  There are many reasons for why you should be using a demo account and honing your skills is one of them.  However, the problem is that many traders feel that the demo account is not a suitable skill indicator.  It is important that you know why this is and how you can overcome some of these problems.

The Shocks You Get With the Forex Demo Account

There are a number of points that make the demo account offered by your forex broker unrealistic.  These points generally lead to a string of losses once a forex trader makes the transition from demo account to live account:

  • Demo accounts come with a set amount of capital which is often more than the forex trader will have on a live account.  This means that you are able to trade with larger lots in the demo account and you are honing your skills with this amount.  Once you start trading live you do not have this capital and you could easily place too much of your account on a trade because of the habit you have created.
  • The forex demo account executes trades at a faster rate than the live account.  When an order is placed in a live account it may be subject to slippage and this causes the order to be filled at a slightly different price.  Demo accounts do not have this problem as the trades are generally executed immediately.  Bids in the live market are also subject to queuing which is not something found on demo accounts.
  • Demo accounts are unable to simulate the emotions you feel on the live market.  As you are not working with your money or even real money there is no fear or greed.  You do not stand to lose or gain anything of value which is not a true reflection of the live market.  Once you trade live you are hit with these emotions and this could lead to losses.

How You Can Trade Realistically

There are certain things you can do when you trade on a demo account that can make it more realistic.  Of course, the demo account will never give you the exact feelings as the live market you can prepare yourself a bit:

  • Don’t use all the capital available to you.  While the demo account may have $10,000 of capital available use only the amount that you will have when you start trading live.  This stops any bad habits from forming.
  • Making realistic assumptions about whether or not the trade is fulfilled is the first step.  When you trade on the demo account if the order is filled within a tick of the highs and lows pretend the trade was not filled.  You should take this trade off the list of trades the account has because on a live account this trade may not have been filled.
  • Account for any slippage on popular currency pairs.  You should include a couple of pips slippage when you trade common currency pairs and fewer pips if you trade a more exotic pair.

 

 

 

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Using a Forex Demo Account as a Skill indicator

Forex Skills Through Training

When you trade forex you need to use a demo account before you start trading live.  There are many reasons for why you should be using a demo account and honing your skills is one of them.  However, the problem is that many traders feel that the demo account is not a suitable skill indicator.  It is important that you know why this is and how you can overcome some of these problems.

The Shocks You Get With the Forex Demo Account

There are a number of points that make the demo account offered by your forex broker unrealistic.  These points generally lead to a string of losses once a forex trader makes the transition from demo account to live account:

  • Demo accounts come with a set amount of capital which is often more than the forex trader will have on a live account.  This means that you are able to trade with larger lots in the demo account and you are honing your skills with this amount.  Once you start trading live you do not have this capital and you could easily place too much of your account on a trade because of the habit you have created.
  • The forex demo account executes trades at a faster rate than the live account.  When an order is placed in a live account it may be subject to slippage and this causes the order to be filled at a slightly different price.  Demo accounts do not have this problem as the trades are generally executed immediately.  Bids in the live market are also subject to queuing which is not something found on demo accounts.
  • Demo accounts are unable to simulate the emotions you feel on the live market.  As you are not working with your money or even real money there is no fear or greed.  You do not stand to lose or gain anything of value which is not a true reflection of the live market.  Once you trade live you are hit with these emotions and this could lead to losses.

How You Can Trade Realistically

There are certain things you can do when you trade on a demo account that can make it more realistic.  Of course, the demo account will never give you the exact feelings as the live market you can prepare yourself a bit:

  • Don’t use all the capital available to you.  While the demo account may have $10,000 of capital available use only the amount that you will have when you start trading live.  This stops any bad habits from forming.
  • Making realistic assumptions about whether or not the trade is fulfilled is the first step.  When you trade on the demo account if the order is filled within a tick of the highs and lows pretend the trade was not filled.  You should take this trade off the list of trades the account has because on a live account this trade may not have been filled.
  • Account for any slippage on popular currency pairs.  You should include a couple of pips slippage when you trade common currency pairs and fewer pips if you trade a more exotic pair.

 

 

 

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