The Psychology Of Fx Trading

Is there anything like the psychology of Forex trading? I would say yes!  I think that, for you to be a successful trader one must understand the fundamental principles of the market.

just like in any subject, be it Accounting, Economics or Mathematics. the first step in understanding the subject, is to understand the guiding principles that govern the subject. Same goes for trading. one cannot make profit in the market in the long term if he or she does not understand the fundamental principles that govern how trades are made.

there are no short cuts, indeed no quick fix to trade effectively in the  market, despite what anyone might say. I think that, the only way to be successful  is to get  the psychology of trading.

thanks for reading

BLOG ARTICLE REFERENCES

Thomas .J, Yeomans, Fundamentals, Economic Theories Applied To The Foreign Exchange Market.



School of pipsolpgy by babypips.com.



Encarta, Encyclopedia.



Wikipedia, Online Encyclopedia

STRATEGIES PART ONE : SCALPING

Scalping is a short-term forex trading strategy. Scalping involves trading larger lots ( Lots are the way foreign currencies are traded in the  market) with small pips. Scalping trades only take minutes or seconds.

This trading strategy may not be for everyone, because it requires a lot of cash plus it's a very risky strategy.

thank you for reading.

Understanding Pivot Points

Pivot points are very interesting to me. especially when I can use them to increase the number of zero's in my trading account.

THINGS I KNOW ABOUT PIVOT POINT

Pivot point are points reached by a support or resistance level which than reverse in the opposite support or resistance levels. Pivot points can be compared to a pendulum ball that goes back and forth. many traders like me use pivot points to identify important support and resistance level. they are important because at this levels the price can change direction, which could be a loss or a gain.

I use pivot points for my short term trades especially for scalping, taking advantage of all those small price changes between pivot points.

HOW TO CALCULATE PIVOT POINTS

You don't need to know how to calculate pivot points many forex plate forms do it for you. But, just for fun (as they say where i come from no knowledge is a waste). to calculate pivot point you will have to know the last sessions Open, High, Low, and Closing prices.

this is the formular to calculate pivot point:

PP = ( High + Low + Close) /3

Since pivot points are directly related to support and resistance levels, you will have to calculate the pivot point for each support and resistance level.

Formular for the first pivot point support level:

Support 1 = ( 2* PP) - High price

Formular for the first resistance pivot point level:

Resistance 1 = ( 2* PP) - Low

This is just for the first level, I really don't won't to go any further before I get accused of being a mathematical show off, and as I said earlier this calculation is already done my most plate forms. And from what I have seen many of this  trading plate forms even give additional pivot point, like pivot points in between support and resistance levels, and many other features.

Thank you for reading.

TWO FOREX TRADING ROBOTS

there are many good and bad robots out there. in another article I will tell you how to choose the good ones and avoid the bad ones. but for now this are two robots I'm studying.

FAP TURBO

so many people have written about this forex robot and you may know about it. they say it's very flexible and adaptable, they say it could be used effectively both in a short term trading plan for a trading strategy known as scalping or in a long term trading plan for big profits. for me I believe this is sales pitch and hype the best way to prove this, is to use it.

 MEGADRIOD

the megadriod is said to have artificial intelligence, it can think on its own. I have not used it but if, it can think on its own, I guess I will try it out on a demo account.

thanks for reading.

WHAT ARE ROBOTS?

the forex market is a very profitable market. but many may not have time to learn the guiding fundamental principles that would increase their probability of being successful. but, with robots busy people can also trade  and earn some money. But, what are  robots?

FOREX ROBOTS

in my own opinion  robots are automated software that can trade the fx market. robots are programed to make complex trading decision in the absence or presence of the human trader.  robots can be compared to video game software that is programed to play games against a person, so that on a boring day anyone can sit back play a game and waste his or her time.

just like everything  robots have there advantages and disadvantages, let see some.

ADVANTAGES OF  ROBOTS

To be a successful trader a person has to trade according to his or her personality and  robots fit into the personality of almost everyone. all a person needs to do is buy them, install them, use them and than relax and they do all the work.  robots can trade all through the year. now let's look at the disadvantages

DISADVANTAGES OF  ROBOTS

to use  robots well one must know about the  market and this is a disadvantage for people who may not have time to patiently learn the principles behind trading decisions, let's be realistic if one knows nothing about the market how does he or she know his not being sold a fake  robot and how sensible is it to invest your hard earn money into something you know nothing about. so one needs at least a basic education about  trading to use  robots effectively.

robots make money but they also loss money. many  robots sales people online say their  robots is the best and promise huge profits if one buys the robot, don't get me wrong good  robots do make huge profits, but not all promise about a  robot is true, in my own opinion the great number of unsuccessful  traders who use  robots show that some  robots can actually make one loss all his or her trading money.

also the foreign exchang market is dynamic and not all  robots may have being programed to adapt to it's erratic nature. this could lead to loss of money or missing profitable trading opportunities. Also,  robots are very expensive.

thanks for reading

TYPES OF ROBOTS

I will provide more information later.


 ROBOTS


1. FAP Turbo

2.  Megadroid

3.  Growth Bot

4.  Cash Evolution

5.  Autopilot

6.  Ambush