Archive for the "Trading" Category

10.03.2010 Post in Trading

Stop-loss is an order to stop, used for loss control. During the movement of the position towards losses, stop-loss goes off for its close. A broker closes the position, when the value of the ‘buy’ or ‘sell’ currency order reaches the setup level. If the chart’s curve has not moved in your direction, the loss is fixed, if the curve went to the profit direction and then reversed, the profit is fixed.  Thus, having setup the stop-loss in the loss point will help you not to lose a large sum of money. In case your forecast has appeared correct and the price is moving in the positive for the setup order direction, but you consider, that it is early to close the position, it is necessary to setup the stop-loss order in the passed through level, where it is still possible to save the profit. And further on irrespective of the future events you only have to wait for profit.

Take-profit is a pending order for the position close at the setup price, used for fixing the profit. Take-profit and stop-loss function on the analogy, though, take-profit is fixing only profit.

So, setting a take-profit order in a forecasted point in advance, you suppose that after a certain period of time the order will reach the profitable level, and you think that in this point exactly it is needed to close the position and fix the profit.

Stop-loss and take-profit are often setup together, in case the forecast has appeared true- you gain the profit, if no, you will lose only the sum you are prepared to lose.

The most part of trading terminals offer such service as a trailing stop. On setting up a trailing stop, the following occurs: the terminal does not operate until the position has not started its movement in the profit-bringing direction. At that moment, the terminal sets up a stop-loss at a certain distance from the current price. On receiving the quoting, at which the distance between the current price and the stop-loss will exceed the certain quantity of points, the terminal sends the command for the stop-order change by a few points distance from the current price. In accordance, a trailing-stop is a certain algorithm of stop-loss managing. But it is necessary to remember that this option is functioning only when the terminal is started up and exchanges the up-to-date information.

Added by InstaForex Staff

05.03.2010 Post in Trading

Day by day the popularity of Forex market is steadily increasing. At present, there are no people left who don’t know what it is and how to earn on it. However, trading is rather complicated process: only 10% of traders, entering Forex market, work and really earn. All failures of newbies consist in their unwillingness to learn all the niceties of Forex trading, and this causes loss of all invested funds. Strong influx of traders was noticed when brokers gave an opportunity to trade at mini trading accounts. Forex statistics is extremely useful thing for people who trade at the international Forex market as well as for people who are interested in processes occurred in the world economy. Forex statistics includes such indicators as economic situation in a country, important facts of the business world, industries development data, currency indexes.

In order to distribute investments rationally transnational corporations and large banks use Forex statistics. Traders and brokers exploit Forex statistics to be able to orient in the market situation and make proper decision on purchasing a currency.

Forex statistics helps trader to monitor the currency rates changes during a long period of time and, moreover, Forex statistics can also clarify the reasons which influence the market.

At present moment, each trader can use market statistics of trades at Forex market which they find at the universal portal for traders MT5.com. Current trends of the market are presented in the section “Market inside”. Trader can visually consider all movements inside the market in whole and of certain its segments. The information provided in this section will be useful for traders who evolve a trading strategy on the principals of fundamental analysis. Constantly referring to this section you will be able to give advance notice of market movement due to the information about its fundamental changes to some directions. At the page “Market inside” trader will find the fullest information about: number of deals by the currency pairs, summary positions, trades volume, number of pending orders, pending sells and pending buys and volume weighted entry point.

Added by Evgeny Staroviborny,
InstaForex Development manager

25.02.2010 Post in Trading

Working 24/5 at Forex market it is possible to be earning money for several weeks, and loose everything in just a few minutes. Absolutely everybody, from a beginner to a professional, has experienced this. Thus, every trader should understand, that risky factor always exists and you should be ready for anything. A constructive approach, attention and logically adjusted analysis will help you to find correct answers to your questions.

Below, 9 topics will be discussed in order to prevent the traders from losing their track.

Fact 1

Traders, who predominantly experience intraday and short-term trading, can be added to the group of unlucky fellows. But the general reason for all failures is not that they are under time restrictions, but the fact that they do not have a good training and a clear-cut scheme of actions during their work. The absence of knowledge and educational background at this type of trading does not forgive even momentary mistakes; any misstep can bring to the loss of the deposit sum. Moreover, such traders often do not have sufficient funds on their trading balance. More successful traders can be trading mid-term or long-term.

Conclusion:

From a statistical point of view, a mid-term and a long- term trade have a greater possibility of profit. The same can be told about the invested funds, a chance of staying at market wholly depends on the sum of the initial capital.

Fact 2

The traders, who have no luck, often spend much time on the analysis of where the market will be tomorrow, on the contrary, more successful traders decide on the actions under the current conditions, and according to these conclusions are building their strategy.

Conclusion:

If a trader can predict the reaction of the mass, luck will be on his side. An opportunity to increase the capital considerably grows, if a trader can react to irrational buying and selling of the majority by a logical plan of actions. Consequently, being a lucky analyst is more difficult than being a lucky trader. An analyst has to make a more difficult work, as he should forecast the movement of the market and recommend how to get maximum profit, while a successful trader just has to follow the market.

Fact 3

More lucky traders pay attention to the deals which brought loss and the ratio of the risk to the profit, while the failures concentrate on profitable operations.

Conclusion:

Paying attention to the risk is more important than to the profit or losses. The traders, who consider trading from a professional viewpoint, always take into account, how much they can gain and how much they cam lose.

Fact 4

As a rule, the traders, who cannot control their emotions, are impossible to be called lucky. Successful and more experienced traders analyze the market without emotions.

Conclusion:

The trader’s approach cannot be named neither well- grounded, nor logical, if the position opening and closing happens only on the basis of intuition. But complete ignore of emotions and feelings is also wrong. Sometimes, numerous stresses can bring to mental disorders; moreover, it is possible to lose general trading skills. The best way is to trace each emotion, and afterwards, check if there are still the reasons for this or that action.

Fact 5

All inexperienced traders are very concerned about their rightness, but the professionals accept emotions, though never let them overtake mind. Successive traders take notice not only of what can bring the profit, but also of what can prevent from it.

Conclusion:

It is very important always to be in course of events at the market, but one should also separate private life from trading. Big pressure causes psychological breakdown and physical fatigue. Professionals of trading always react fast to the current market events; it’s just a job for them, which brings yield.

Fact 6

Losing funds during the trade, the unsuccessful trader starts to buy new books or trading systems, starting to work according to their conception at once, but an experienced trader analyses what happened and corrects his methods in respect to the received data. A better trader does not start using a new system at once, but only when he realizes, that his old one deceives his expectations.

Conclusion:

Good traders always keep to their methods, usually using only a few trading strategies.

Fact 7

Traders, who have little experience of trading at market, sometimes try to copy the actions of the famous traders. Professionals at this time consider all strategies, including those of famous traders, but use the example only if it suits into their style of trading.

Conclusion:

The trader’s personality, his knowledge of the market and his personal trading system are much more important than the achievements of the great market speculators.

Fact 8

Often the traders with no trading experience at market do not notice many factors, which could bring them profit. The sum being in work defines the profit of every trader, which is realized by professionals. More money should come to Forex, than leave it, and this should be taken into account by every trader.

Conclusion:

All factors, which can influence the profit, should be taken into consideration during the trading.

Fact 9

Generally, all traders, who have just started working at Forex or who are constantly losing an opportunity to gain profit, take this too close to their hearts. While, more professional traders perceive it easily. The process of trading brings them pleasure, at the same time, they are taking it absolutely serious.

Conclusion:

Psychiatrists found out that the more serious a man is, the easier he is exposed to illnesses.

Sum up:

Successful traders as well as unlucky ones perceive trading at Forex as a kind of game.

If we compare trading to a game, a bowling for example, the beginning traders will understand, that strikes’ rate, which is achieved by professionals with no visible efforts, is a result of a long time spent outside the “big game”. Like in sport, trading accounts for a great number of inner and outer factors.

It is necessary to be serious about every conducted operation. The professional traders differ from novices in that the former follow a definite trading strategy; the latter take it as a game.

Added by Olga Vitkovskaya,
InstaForex Clients’ relationship manager

17.02.2010 Post in Trading

Absolutely every trader has seen a gap on the charts, but what it means, and why it takes place, is not clear to all. A gap is a price difference, which usually occurs on Mondays after the weekend at Forex market. Forex is a currency exchange, functioning 24 hours five days a week.

But currency rates at Forex do not stop their movement even on days-off. The last ticks of the quote changes can be observed on Friday, after that, the rates stop their movement for two days exactly at the same position as it was at closing of the session on Friday. The difference between the quotes on Friday and on Monday can be detected by traders only on Monday. But on days-off, Forex is showing the changes of currency pairs’ quotes.

There are brokers, who depict the movement of currency pairs even on days-off, nevertheless, trading is not carried out, and the gap on the charts cannot be seen.  Thus, such notion as a price gap does not exist at Forex market. Brokerage companies and dealing centers use the smoothing of the quotes on Forex “days-off”.

When important news is released, there appear ugly peaks on the candlestick graphs, and in order to continue normal trading, brokers smooth the quotes. But a question arises: what is the advantage of brokers, who make quote purchases even on Forex days-off?

Among the general positive gaps’ features is the actuating of pending orders. Consequently, using automatic trading systems in the process of trading, a trader can achieve the most profitable results. The only signal for trading using automatic advisors at Forex, is the receipt of quotes, that is why, the display of the current quoting rates should take place even on Forex days-off.

Added by Alexey Skachilov,
InstaForex
Clients’ relationship manager

13.02.2010 Post in Trading

Forex is the market of interbank currency exchange at free prices. The market participants are banks, pension funds, transcontinental corporations and private individuals. The international currency market does not have any strictly regulating system, and requires no direct communication of a seller and a buyer during the transaction conclusion.

At present, currency market Forex is the largest telecommunication space, which is working five days a week and 24 hours a day. The address of the international currency market can be simply found in the Internet, to do this, we can use the search- engine Google, Altavista or Yahoo and so on, the only difference here is that in every country, Forex market has its own representative office.

Currency trade in electronic format can considerably differ from trade at the interbank level. Network address of Forex system allows conducting deals in electronic format using specialized software.

In order to have a possibility of working at Forex, it is necessary to open a trading account.  Forex account address is accessible for trader’s work in the telecommunication system- it is a personal account, with the help of which diverse currency operations, as well as withdrawing or depositing of funds are made.

Many traders organize clubs for experience exchange, in different cities, there are numerous platforms, which allow discussions of numerous questions connected with working at Forex. The address of such traders’ communities can also be easily found in the Internet. The registration on these resources makes it possible to find quickly and without special efforts the required information about working at international currency market Forex, and answers to all questions, which a trader can have during his work at market.

Countless Internet resources will help to get acquainted with information about Forex. Addresses of Forex educational courses, brokerage companies and support services for clients, whose work is remote, allow with no difficulty to get all essential information about the market currently trading sessions.

If you are a beginning trader, the best and the most effective variant for you is an educational course. All addresses of educational courses and Banking Schools can also be found in numerous Internet resources. Educational courses, seminars, masterclasses will help to understand the essence of Forex work in details.

Private investors are able to make all transactions through brokerage companies and dealing centers, to do this, it is required to enter into an agreement, where personal data are indicated. International currency market Forex makes it possible for a vast number of traders to conduct numerous deals.

One can also find answer to absolutely any question about working at Forex, by making a search in the Internet. If you had problems during your work at market, you should turn to support services, and there are lots of them in the global net, where you can get a consultation of a specialist.

Forex market is one of the most dynamically–developing and widespread markets on the planet, this makes it possible for traders to work and gain profit.

Added by Ekaterina Kelehsaeva,
InstaForex copywriter