Archive for the "Trading" Category

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

04.02.2010 Post in Trading

Forex market has its own strict rules. Trading operations are carried out within a certain timeframe which is shown in a trading session timetable. The trading session is opened around-the-clock: in weekdays – from Monday midnight till Friday 22:00. As the banking activity is low during the weekends, the currency market does not work.

However, the world time differs in all countries and continents, so as soon as in one part of the world the trading comes to an end, in another one – it just begins. These time peculiarities are set out in the trading session timetable at Forex. That is why, there is nothing more important for a trader than to be at the right time and place.

It is essential for the category of active partakers at the trading platforms. For traders it is important to be in touch with the market situation constantly to have an opportunity of making the deals in the real-time mode with the most beneficial result.

The trading session timetable contains rather huge data volume which is impossible to keep in mind all the time. At this point, the trader can find support in various Internet-resources, where the current timetable of all trading sessions is entirely available. Moreover, there were created special programs which request information on the work schedule automatically and display it in a comfortable graph form.

Often, a certain trading tendency of one continent can be different for a trader from the aspect of investment profitability. In this case, he can rely on the trading session timetable in order to orientate himself in a great many of current events which are presented on-line and permanently up-dated. Being at the peak of economic activity, traders can work clock round in accordance with the scheduled sessions.

In consequence of the economic downturn and instability, a massive managers quit is currently observed. More and more new employees come into the labor market, they often have a higher education and necessary skills to make analytical forecasts for the market. It is this kind of people who become traders today. And the trading session timetable of Forex market appears to be a good aid for them.

Take a look at the trading session schedule in the following table:

Region City Winter time
open/close
Summer time
open/close
ASIA Tokyo
Hong Kong
Singapore
03:00    11:000
04:00    12:00
04:00    12:00
04:00       12:00
05:00       13:00
04:00       12:00
EUROPE Frankfurt
Zurich
Paris
London
09:00    17:00
09:00    17:00
09:00    17:00
10:00    18:00
09:00       17:00
09:00       17:00
09:00       17:00
10:00       18:00
AMERICA New York
Chicago
16:00    24:00
17:00    01:00
16:00       24:00
17:00       01:00
PACIFIC Wellington
Sydney
00:00    08:00
01:00    09:00
00:00       08:00
01:00       09:00

Added by Evgeny Galaev,
Chief Manager of InstaForex Client Relations Department

20.01.2010 Post in Trading

The modern Forex, on the assumption of list of services, provided by brokers, is a system of exchange trade of currency, metals, contacts for difference, etc. The work with rates increase and decrease at cent accounts does not differ from a classic work at real Forex market. At first sight it seems that this structure is very difficult, but having worked a little, you understand that everything is more simply. If you worked out in cent accounts, be sure, that the door in successful activity is slightly opened for you, and investors will be ready to entrust you the management of thousand dollars accounts.

If you are at the beginning of trader’s way, you should start from cent accounts. A lot of brokers offer to trade at mini-Forex starting with 10 cents. The point is that work at mini-Forex does not have essential differences from the work at “large” market.

Cent account can be used as intermediary from demo to real. Demo-account is attractive by the fact that any losses which you will, probably, have, in no way affect your wallet. However, there is one significant disadvantage, connected with the psychological part of trading. Being confident about your monies safety, you will not be able to plunge into the whirlpool of financial business, where on the next day after you have won a million you can lose everything. In order to overcome two main enemies of trader the fear and greed, you just need to feel the trading process, and that can be done only with real money at the real market. That is why the intermediate trading process at the cent account is the optimum alternative for the newbie. Minimizing the risks of losses in the case of trend reversal to the unfavorable side, you can continue the training at cent account. At that your small victories will be rewarded with the small but very pleasing profit. Of course, when the cost of point is 1 cent, you should not expect the huge earnings. Use the cent account only in order to study the market with its sometimes sharp movements, as well as for experiments with trading strategies and systems.

On the assumption of all mentioned above, the idea of cent accounts is that almost each beginning trader can, investing the small amounts of assets, learn the work skills with the real accounts. This is necessary for reduction of newbies’ potential risks. The major financial mistakes, which a lot of novices make working with the cent accounts, are minimized and can not be a barrier at the beginning of the trader’s professional way.

However, today because of the situation that market is oversaturated with traders a lot of brokers strive to decrease as much as possible the supply on the cent accounts, forcing in this way all traders to work with dollar accounts, as it was at the very beginning of Forex market development.

In such way, it can be said that cent accounts is a perfect launch platform, which gives an opportunity to any trader to learn all necessary skills and gain trading experience, realistically assessing his/her own possibilities for the real work at the currency market.

Added by Svetlana Milyushko,
InstaForex Clients’ relationship manager

13.01.2010 Post in Trading

As a rule, currency pairs’ movement on Forex market is directed, i.e. trend which is clearly determined after it finished. However, for more efficient work traders should know its direction at the beginning of a week.

Factors forming trend on Forex market:

Two factors can help you to determine the direction of weekly trend:

  1. Friday currency pairs movement on American stock exchange.
  2. Opening GAP (significant difference between the price at the end of previous and beginning of following day) at midnight from Sunday to Monday (Asian session). The result is currency pairs draw their resistance levels, breaking through one of them they turn it into support level, push off from it and will move in this direction the whole week.

Between American session on Monday and Asian session on Friday the channel of pikes resistance levels (by fractals and zigzags) determines the starting point of currency pairs breaking through up and down and as a rule, the whole week move in the preset direction.

The first and fundamental moment of currency pairs’ behavior on Forex market is their movement on Friday at American stock exchange. It is test through released news, strength and trend direction.

If extremely negative or positive news issue did not influence the currency pairs’ fluctuations on Forex market on Friday, it means that brokers and banks were not ready to such fluctuations and movement will start on Monday.

There are two variants of developments, if currency made abrupt jump in trend:

  1. New trend wave, for example 400 pips, which currency pairs moved in for the previous week, turns by Elliot into the first wave and the third wave in the same direction will be equal to 640 pips which is 60 % longer.
  2. Being at the beginning of medium-term trend wave from h4 to daily and weekly charts in this case pullbacks are from 23% to 62% – movement is trend-forming – new week – new jump along the trend.

If during the American session on Friday currency on Forex market did not start its movement it means that brokers can not determine the trend or movement direction for the next week and this direction will be known only on Monday.

We can make a conclusion from all above: depending on the Elliot waves’ behavior Friday determines the currency movement for the beginning of the next week.

  1. If potential trend strength is very big and there was leap in trend on Friday, then on Monday correction or reverse or news wave in trend is expected.
  2. If on Friday currency jumped against the trend, then this Friday movement will turn into correction or the first wave of reversed trend.
  3. If currency did not start its movement on Friday, it means we can expect the formation of movement on Monday or Tuesday.

One more Forex market peculiarity is analysis of news calendar for the next week. Events which can influence trend’s mood and all corrections should be pointed out.

There is also characteristics which was noticed by A. Elder – you should pay attention to the gap which appears at midnight to Monday – whether currency pairs of allies opened up or down and what direction currency will move after that at Asian trading session – as a rule, the same direction currency will move the next week.

To earn at Forex market, you should understand that intraday trend does not exist by itself.

The main conclusion which should be made by a trader: currency moves the main part of its distance before the news release and just a little movement can be noticed when news was officially confirmed in case it has justifies the forecasts.

To be right, trader should observe only two rules:

  1. It is necessary to use strong movement during the whole week in direction of published news.
  2. You should be ready for reverse if the news did no justify expectations.

Added by Alexey Talesnik,

InstaForex Clients´ relationship manager