There was recently a rally in the stock market. The global economy is almost out of the recession. The US economy that drives the world economy is showing signs of recovery despite record unemployment rate that is being expected to go down in 2010. Stocks are back!

Stock trading has always been the most popular form of investment. Buy and hold has been a proven and tested method of investment. There are many companies that have weathered the recession and there stocks are now poised for a rebound. In the last few years, forex trading has also come off age and many people started trading forex after the stock market crash of 2008.

So which is the better: stock trading or forex trading? Let’s compare the pros and cons:

1. Forex is a 24/5 market which means that in the forex market you can see continuous action throughout the week except on the weekend unlike the stock market where stocks can only be traded during the day mostly 9:00AM to 4:30PM EST. What this means is that you can trade forex anytime of the day. If you have a day job, you can trade forex after hours.

2. More than 90% of the global forex transactions involve US Dollar. There are not more than 6 currency pairs involving US Dollar that are heavily traded. As compared to that there are more than 50,000 stocks registered in the US stock markets alone what to talk of those stocks registered in the London Stock Exchange, the Tokyo Stock Exchanges and other exchanges. So in forex trading, you only need to focus on a few currency pairs. The most heavily traded currency pairs are GBPUSD and EURUSD.

3. Forex brokers offers leverage as high as 100:1 as compared to 2:1 by stock brokers. So even a small price movement in the forex market can be profitable as compared to the stock market.

4. In forex trading, you can practice on your demo account until you get the rquired experience. Recent development of automated forex trading has made forex trading easy for people who have no previous experience of trading.

So if you compare stock trading with forex trading, you will find that fx trading is indeed the better option now. There is never a bear forex market. If one currency goes up, the other in the pair goes down. That’s why FX Trading is being called the Recession Proof Business of the 21st Century. Don’t wait for the economy to recover completely. This is the best time to trade forex!

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There are many successful ways of trading the Forex markets. Some traders swing trade where their anticipated hold times are from a day to a week+. This requires having a wider stop and usually has less than a 50% win rate and because of the wider stop the trader must trade very small lot sizes in order to protect their capital. Some traders look for intraday trends that last 30 minutes to 3-5 hours. This can have a much higher win percentage, over 50% and much tighter stops so a trader can trade more lots than with swing trading and there are many systems available that find 30-100+ pips per day.

This article is about Forex scalping techniques. Scalping is when a trader has a very short hold times and expects to make only 10-30 pips on most trades. Because it is a very precise way of trading, traders can have super high win rates of 80% and higher! Also, because the hold times are often 10 minutes maybe up to an hour or an hour and a half, traders who have full time jobs and are trying to trade the Forex for additional income or retirement savings can fit it into their busy schedules easier than any other form of trading.

The most important concept in ANY form of trading is to keep losses small and have bigger winning trades than your losses on average. But with scalping, due to its higher winning percentage when done correctly, a trader can get away with winning trades the same size as losses. So say your stops are 10 pips, you can take 10 pip wins. The markets during the UK, Europe and US session move so much in most currencies that finding a 10 pip move in 10 – 60 minutes is not too difficult.

It’s also not unreasonable to have 20-33% of your winning trades be for 20+ pips and this also makes this method not only profitable but also a lower stress way of trading because the trader knows real fast if the trade is likely to work and if not will exit with a 2-5 pip loss instead of 10 or often times a 2-5 pip win as the trade stalled out and its always better to take a small win than to let the trade go negative!

There are many statistical tools I use to know which currencies are most likely to go up and to go down, but for traders who are using just regular charts you can look at a currencies daily chart and if the trend is up then FOCUS on buying that currency when scalping and when down focus on selling.

So once you know the longer term trend, look at today’s trend. Bring up a 60 minute chart and put on 20 period simple moving average. If the currencies daily trend is up and today its above this moving average you want to look for buys. If the daily trend is down and today price is under the hourly moving average you want to look for sells.

The next step is the EXACT entry and exit method. Once you’re trading in the direction of the longer term trend and use the FILTER of the hourly MA then this is the easiest part. Wait for a SPIKE move in the direction of trend. Then on next pullback draw a trendline over/under the bars highs and/or lows. If the trend is up and spike is up, wait for a down move of at least 15 minutes and draw trendline over the highs. When price breaks out up you buy and stop is 2-5 pips under the swing low. Exact opposite for sells, wait for a spike move down, then a pullback up move. Draw trendline under the lows and when broken enter.

Another method of scalping is to draw Fibonacci retracements and profit targets on chart. Use the trendline approach when this support/resistance is hit and enter upon trendline breakout. What I do and recommend to our traders is using 50 tick charts and use 2.2 keltner channels. If trend is up as described above buy the lower band. If trend is down then sell the upper band. You can exit scalp trade at other end of the bands or trail stop up.

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If you want to start trading in the Forex market and make money, the first step is to learn as much about it as possible. Forex is a place where trading goes on with currencies of different nations, usually via brokers. Foreign currencies undergo constant buying and selling across global markets. The currency movement in this cash market depends a lot on real-world events ultimately affecting traders’ investments.

What makes Forex such an attractive proposition is that it is open 5 days a week and 24 hours a day with the dealers always on access. Secondly, as the market is enormously liquid, almost all currencies can be traded. Thirdly, since the market is extremely volatile, the chances of profit are huge. Fourthly, risk can be controlled by using standard instruments here. Fifthly, zero commission trading is possible.

When you trade in Forex, your goal would be to make profit from the movement of foreign currencies. Trading is done in currency pairs. An example will make the basics of trading clear. Suppose that the exchange rate of Euro-USD is 1.5000 on a particular day. This number is also known as “the rate”. If a trader buys 1000 euros on that day, he will be paying 1.5000 U.S. dollars for it. A year later the rate becomes 1.9000. This means that the euro value has increased in comparison with the U.S. dollar. If the trader sells his 1000 euros now, he will be receiving 1.9000 U.S. dollars. So he will be making a profit of 0.4000 USD. However, this investment needs to be compared to other alternative investments to know whether it has been really profitable. An example on an alternative investment can be a risk-free investment like U.S. government bonds which are long-term.

One thing that you should keep in mind is that you must buy currencies which are expected to increase in value compared to currencies which you are selling. If a currency you have bought does increase its value, the other currency should be sold back thus locking a profit. “Open trade” is when a trader buys and sells a currency pair but does not traded it further closing the position.

It is a well-known fact that Forex is a very speculative market. At least 70% of the traders have no plans to actually take the profits of the currency traded at the end, they were only speculating.

The reason why most traders fail to make a tidy profit in the Forex market is that they opt for short-term trading. Movement during the day is pretty random and traders who opt for it get stopped constantly and rarely make profits. In Forex you need to think long-term. Again, many traders have a very general idea about volatility. Some traders are so scared of risks that they trade in a way where there is no possibility of winning.

So before you venture into Forex trading learn about volatility, risks, trends and markets very thoroughly. And do not go into it thinking it’s a make-rich-quick- scheme. It is definitely not. Forex trading needs concise study and an always-alert mind to really gain from it.

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The object of Forex trading is to determine the rise and fall of the value of a particular currency and trade when a profit can be made.

To learn to trade Forex, investors should select a well-developed and comprehensive program that, at minimum, explains how to:

*Understand the logic behind Forex trading

*Recognize and capitalize on market trends

*Minimize risk and protect open positions

*Build a consistent and valuable portfolio

*React to major economic events impacting global currencies

Review and know the basics. What does margin mean? What about types of orders? Or bid/ask? Rollover? The more you know the better off you are.

Another important concept to know about is the two important approaches to analysis. These are technical and fundamental analysis. To increase the odds of success you should understand both of these methods and how to properly apply them.

You will want to belong to at least one forum for Forex traders where members chat about anything related to the Forex market and trading. However be aware that just because someone posts in a forum does not mean he is an expert.

If you are going to choose a Forex training course or program it is important to do your research. Not all of these programs are equal. Nor will each best suit your individual needs and style.

Often these programs do not go beyond the basics. While basic concepts and a solid foundation are vital, these are not going to be where you will see your results.

Trading the Forex market is not an easy task. A lot of hard work is required. If you do your work and learn a foundation of information to trade on you may gain true financial rewards.

A number of the websites that you can sign up with to do this offer free trial accounts to help you learn before you invest your money. While you wont make any money in the trial accounts if you do well, it is just pretend money essentially but with the real market conditions.

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The Forex Day trading world is one of the most difficult for many, especially for those who are starting out. One may be bogged down with the losses one may occur while trading in Forex. Yet, one should hold hope for his investment, because it can indeed be a very profitable trade – profitable in ways because currency is what runs the whole world. Everyone needs and uses currency; it is only natural that one should benefit from this necessity. In order to become successful in Forex trading, one must use Forex day trading strategies.

Many of these strategies are all over the Internet, but many of them do not work or may work if you can afford to lose money. One strategy is to buy the currencies which are the mainstreams in the world. Buying those important currencies is really where the true profits lie. A trader who controls all the main currencies of the world surely has dominated the Forex world. So, consider buying and focusing on main currencies. Another thing to remember is that you must be able to hold on to your investments long enough to profit from them. Many traders often sell at the first sign of loss no matter how small. Although this is done to prevent more loss, it actually prevents future earnings. One cannot expect a big gain in the value of their currencies without incurring some small losses along the way. The idea is to be patient and to keep watch of the market.

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Are you interested in giving Forex trading online a try? If you are then you should know that any newbie in this industry would have to equip themselves with the necessary skills and knowledge or at the basics at the very least in order to minimize losses. Truth be told, you cannot simply go ahead and forget about the basics because this is a very complicated market and confusion often leads to significant monetary losses. Even the experts all started from scratch and if you want to get to the top, you have to start somewhere. Some people, however, tend to overlook this and simply jump right into trading without the least bit understand of how the market works. Trading is not like gambling where you simply play with chances. For you to succeed, it would require plenty of planning, hours put into learning and the ability to put all that you have learned into good use. When it comes to gambling, you simply rely on your luck whilst with trading you can easily predict your success when it comes to the outcome of your trades through proper estimates and forecasting.

One of the things that you should keep in mind when it comes to Forex trading is the need for a broker. A broker basically advises you on the current situation of the market. The rise and decline of currencies are very fluid and can be unpredictable but with the help of a knowledgeable and reliable broker, you can see all the possible money making opportunities which you can take advantage of. Brokers are especially great to have when you are just starting out because you can also learn a lot from them through observation and asking questions. This is why it is also important to choose a very competent broker because if you choose one who cannot feed you the proper information then you will lose your investments. There is also software that’s available and those could also significantly help you when it comes to trading. What else should a beginner know before taking the plunge? Here’s a quick rundown:

- Take the time to learn how the Forex market really works
- Learn how to read Forex charts, this is going to be very essential to you.
- Make sure that you understand how your money should be managed.
- Try all the different demo materials; you will learn a lot from them.
- Take advantage of the free information offered online.
- Learn about the different strategies when it comes to trading and try to create some of yours as well. This would help you understand how the market works even further.

You can also join one of the many online communities related to Forex trading. There you’ll meet other newbie traders and you can exchange information with each other. You can also learn from experts in the forum about the common mistakes that many traders make and what can be done to help avoid those situations. Remember, your knowledge is your greatest asset when it comes to trading so learn all that you can for this would help propel you forward.

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There are a lot of forex robots that have come out in the market these days. This has been used by many traders for longer hours of monitoring and automatic updating of trades. With so many robots around, it will be difficult for a trader to choose which one to choose. A newbie in this field may have to fully understand the ins and outs of the Forex trading first before coming up with a choice from all the Forex robots around.

Better understanding of the trading business can help you get that income you want. This will also help you find the best robot that you want to do the trading tasks for you.

So, what makes a best Forex trading robot? This is simple. If it can perform the tasks that you want it to do and it can generate profit for you, then it is the best one to choose. Before picking a Forex trading robot, you have to know what you expect from it to do. Know if there are robots around that can provide your goals. And if there is, you still have to try it out. Trials can let you decide if you are comfortable in using the robot. If not, better look for another one. Usability is important for any trader.

A robot should also be able to do non-stop updating and monitoring on Forex market changes and movements. It should also do calculations and even analysis on which trades to join that can give you profit. Believe it or not, there are trading robots that can do these stuffs for a reasonable price. You just have to spend more time researching and trying out different robots to be able to make comparison.

This is how a Forex trading robot should work. Like any other types of robots, it should lessen his master’s work load and at the same time put the trader’s mind at ease when it comes to profit.

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There are 100′s of forex trading indicators that can be used to trade profitably with. You may be asking yourself which is the best and which are the worst.

In my experience the use of MACD, RSI, Bollinger Bands or Stochastic are the most popular lagging indicators used by forex traders. These indicators confirm the direction that price is now heading and can be used to qualify a trading decision.

The problem for most traders is that they will start out with one indicator on their charts and for a while they will be happy with the results that they get from reading the indicator. Then they have a few losing trades so they then move on to another indicator in the belief that this will be more successful and not generate any losing trades.

Of course the next indicator has some losing trades so you then move onto the next and the cycle continues. You start moving from one indicator to the next searching for the holy grail. So make the decision to stop and your trading will start to improve.

The three main indicators you need to understand that form the basis of all the lagging indicators mentioned above are price action, support and resistance. The most important is understanding how support and resistance works and how the major institutional players of the market use these levels as their reference points to buy and sell at.

Most traders understand support and resistance but they dismiss this as a trading indicator because it seems too simple. But in my experience the most successful forex traders buy at support and sell at resistance. Old lows form support and old highs form resistance.

Leading indicators that can form possible support and resistance levels are Pivot Points, and Fibonacci retracement and extension levels. These are widely used by the major institutional players and therefore should be considered by you when selecting your trading indicators.

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Most traders lose money and that’s a fact so it Forex trading made easy possible? Yes it is because, if you avoid the myths and get the right education and mindset, it’s a proven fact that you can win.

Forex trading made is easy is possible but being easy does not mean you can get away without learning the basics of trading and doing some work! While this should be obvious to anyone, it isn’t to the vast amount of traders who buy junk, software packages and think there on the road to financial freedom for around a hundred dollars. These traders all get taught some respect by the market, in the form of an equity wipe out. Avoid any of these get rich quick systems or you will join the majority of losers.

As we just said you do need to make some effort and learn the basics but you don’t need to work hard because Forex trading is simple and you only need a simple strategy as it will be more robust than a complex one, with fewer elements to break in the brutal world of trading. You can learn all you need to in around a week or two and then you can start to trade.

Before you start to trade you need to get rid of your ego because Forex trading success is all to do with how you handle your losses. Let them get out of control and you will lose, of course most traders do this, they can’t admit their wrong and hope the position turns around but if you want to rely on hope, you will lose. You need to take losses and hold onto your money for when profits come around again and when they do, you need the courage to milk these trades for all their worth.

Getting the right mindset involves a good education and accepting you cannot fight the market, it will give you losses and you need to take them and don’t worry it will reward you with some great trends, you can follow cover your losses and make some triple digit profits.

So Forex trading can be made easy, just learn the right info adopt the right mindset and you will be on the road to a great second income in around 30 minutes a day.