Thursday, June 26, 2008

learn to trade the forex Information

Currency Forex Trading System - When To Abort A Trade

When the world markets, including the stock markets started to slide a few days ago, many experienced traders would only smile. Not that they were not affected, but they were smiling because they knew markets do go up and come down. It is only at what point in time is it necessary for a trader to quit a trade that has gone wrong- and these experienced traders could smile because they knew when to quit the markets, irrespective whether it is the currency markets, the stock market or the futures and commodities market.

Whether it is a smile or a smirk, these experienced traders have a good reason to do so.

Because when you quit at the appropriate moment, before a market collapse, you would make a lot of money getting out of the markets before the big drop. Those who quit immediately on the confirmation of the drop would not have done much worse, because they would also salvage a large part of their gains that have been obtained over the many months the markets have gone up. It is only those that hold on to their stocks, or shares or financial instruments they are investing in, that will feel the pain as the values of their holdings start to erode... and fall further, and further.

So the big question to ask today is"When exactly is the time to abort a trade?"

Many adopt stop losses, or make a certain cut off point to get out of their stocks.

So let us have some instruction today on the effective way to get out, or the correct timing to abort a trade.

There are two main ways to abort a trade.

The first way is to fix a time determinant to get out of a trade.

For example, for the day trader, if he or she has a basic understanding of a chart pattern leading to a trade, and believed that the chart pattern will work, and has entered a trade based on that chart pattern, but the conditions for that pattern to perform is no longer present, then he must immediately quit the trade, especially if a set number of trading bars have occurred.

For example, if you identify a break out pattern of an ascending triangle has occurred, and you have opened a trade by buying, but soon after you have purchased, your expected outbreak pattern has not occurred after 3 bars, then you may wish to abort that trade when 3 bars have occurred and yet the outbreak has not occurred.

When the time determinant as signified by the 3 bars have passed, it is easy to recognise the conditions for the trade have not occurred and you must then terminate or abort the trade.

The second way to know when to abort a trade is to do so when there is a pattern failure. Again, using the breakout of an ascending triangle as an example, if the price has broken out of the triangle, but then has fallen back into the triangle, signifying a failed pattern, then the conditions for the expected pattern have changed and it is no longer feasible to hold on to the projection of an ascending triangle. In other words the pattern has simply failed and it is the best time to abort the trade immediately.

Any delay is going to hurt you financially. It is wisest to quit a trade when the expected conditions are not fulfilled. Markets have a way to hurt the trader who procrastinates and wastes the earlier chances to get away with a profit, no matter how small.

Getting out of a trade is crucial for you to make profits. Discover how a professional trader gets in and out of forex trades with the ease and accuracy of a sharpshooter by using 3 specialized and easy to use trading systems WITHOUT INDICATORS, and how you can adopt these same powerful trading methods in your own trades to create massive profits, by visiting the author's blog at

FOREX Day Trading - Day Trading Doesn't Work So Don't Try It

The logic of day trading is totally flawed and will never make you money over the longer term and will wipe out your equity.

If you want to prove it ask anyone who says it does to give you a real time track record of profits and you won?t get one.

Why? Because day trading does not make money.

Before we begin, you may ask yourself why there are so many people claiming they make money at day trading?

Well the answer is it?s a good story and appeals to peoples greed.

This creates system sales and revenue for the vendor OF these day trading methods so they make money you lose.

Here are the reasons day trading does not work:

1. Time Period

A day is to short a time period to judge market trends accurately.

Think about it.

Trillions of dollars are traded everyday and prices can go anywhere and there is no way of guessing what the volatility in a day will be or the direction.

Short term moves are simply random.

You could probably flip a coin and do as well as most day traders.

2. Stops

Day traders use the daily range to buy and sell and set stops.

Stops therefore tend to be close to entry by the very nature of day trading.

Volatility in a single session is impossible to judge and most times simply picks off the stops and creates small losses which add up.

3. Banking profits early

Most day traders are looking to scalp a few pips here and there.

They do have some wining trades (more by luck than by judgment) but of course they break the fundamental rule of trading leveraged investments which is:

Run your profits to cover your inevitable losses.

As they have a lot of losses and marginal profits the net result is the erosion and eventual wipe out of account equity.

Day Trading is a good story, but in reality day trading doesn?t work over the long term.

Simply ask any vendor who sells a day trading system for this:

A real time track record of their profits over 3 years and see the answer you get.

The conclusion from all of this?

You guessed it ? Avoid day trading if you don?t want to lose your money.


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