Forex Trading and Tips

Technical analysis of the Forex market was always the focus of Singapore Forex traders. In the principal of the technical analysis is the concept of the wave. Have a glance at the Forex price graph of any instrument. What do you see? Movements of prices are not heading in only one direction. Price, after a long upword trend always goes down and vice versa. Thus a graph of Forex market movement allows us distinguish the waves, which form the market movement. Wave is a one-way direction of the price.

A main point in the identification of waves for the study is the way of its lay out on the Forex price chart. The theory of wave analysis identified a number of waves: on closing prices at the maximum and minimum rates, or on average. As practice shows, for the beginner trader the best way of distinguishing waves on the chart is uniting of the maximum with the minimum and a minimum with a maximum Forex peaks. In this case, the wave distribution becomes very clear, and a beginner Forex trader finds out how to analyze the waves very quickly.

This technique is very easy and lets every Singapore FX trader to make the first decisions on the situation in the Forex market very quickly. After some time, any trader can easily distinguish the beginning and end of the wave, that’s why this approach is universal and the most effective.

In the materials of technial analysis the important point in the Forex price change prediction is the notion of full price cycle. Full price cycle is an upward price movement, after which it always goes down. As a result, the Forex market quote never is stable, it is sure to rise after it drops. As a rule, that wave, which is situated in the direction of the dominant trend, called the current wave, and wave that heads against the trend is called resistance.

Sometimes you can see that a wave is formed not by a single price movement but with few movements of up or down. It is simple to detect the hesitating motion within each wave. This situation has been called fractal waves. A fractal of the waves is that large waves generally formed of small waves.

When Trading in Singapore, traders don’t have to know all the wave materials in order to be able analyze the financial market and trade successfully. One of the main points you should take seriously is the wave detection. Wave marking is a method of applying the basic kinds of waves to the wave models in the chart. Depending on the level of the wave, it should be counted in different ways, in order not to be confused and have a clear understanding of market changes. You should remember that each wave has its own meaning in the price movement.

All currency trading courses always have two large sections: fundamental and technical analysis of Forex market. According to our experience, we came to the conclusion that it is necessary to know about the fundamental analysis, but its role in successful trading is less important.

Let’s talk about the basics of fundamental analysis. The main aim in fundamental analysis is to predict new trends in price movements. Life time of the fundamental factors can be divided into short and long. Short life cycle of an event lasts no more than few hours and includes all random economical or political events. Very often this news is associated with force majeure like earthquake, terrorist acts, etc. Long term cycle lasts from several weeks to several years. Fundamental factors of long-cycle are all factors that influence the global and national economy situation (inflation, unemployment, etc).

The majority of the traders of Forex trading in Singapore are speculators. It applies to both small traders and banks. The main distinction between a speculator and the investor is the duration of time he/she trades in the market. If you have purchased EUR in February and sold it in May – you are an investor. But we don’t have a lot of traders like that. Most Singapore Forex traders make transactions within days or maximum within a week. Hence, the fundamental factors of long life cycle for these traders are not very important.

Regarding the fundamental factors of a short life cycle, it is still hard to see their importance. If it comes to natural disasters, you need to be rapid enough to open a trading position in a precise moment, because in most cases you will miss the moment. When it comes to anticipation of news, it also looks difficult. As an example let’s consider the unemployment rate announcement in USA. If the news coincide with the predicted value, it is unlikely that the USD will change. Means that you will have a trading opportunity only when the news doesn’t coincide with the predicted information.

Fundamental analysis will not let you know when to open a trading position. Taking decisions basing only on fundamental analysis is extremely difficult, as you have to handle a huge volume of information. Besides it will take you much time to read all reports, news and briefs.

To sum it up, according to our researches a trader has to have a handy economical calendar of important economic events to trade Forex in Singapore, but only for avoiding opening a trading position before the release of big and important news. Because the big announcements may cause a high volatility in Forex market and your position may be closed by stop loss before the market takes any direction.

Thousands of strategies were created since the moment when Forex trading in Singapore was created. And every time their creators were proud to announce that a perfect Forex strategy is found. But in the end none of these systems could provide a stable income for a Singapore trader. Most of the existing strategies either don’t work at all or strop working after a long use. It makes sense as the Singapore Forex market is volatile. Even an effective strategy that brings you profit now will fail tomorrow. It will have to be upgraded according to the market’s changeable conditions. But the situation is not as bad as it seems. Out of thousands of Forex strategies there are ten universal ones that won’t die even after tens and hundreds of years.

One of these techniques is the news trading strategy. In this article we will discuss this technique. It is one of the most universal Forex strategy. Its basis is to execute transactions during or after the announcement of important financial events. Still the strategy is based on the strong market trends otherwise it would not make sense. The most important news is the majority of financial events in USA. The special attention must be paid to the news on interest rate changes as it usually causes very big rates movements.

In order to succeed trading on the news, we recommend you to follow these basic rules:

1.Don’t risk much of your funds. You have to always do a good money management and for news trading it is even more important. If in most cases you are trading with 1/10 of your balance, so on news trading you should decrease it to 1/15 or more.

2.Don’t place a trading position before the news announcement. The early opened position has a big risk for failure. Though you can easily find out the forecast of the news, you cannot know for sure if these expectations are going to be true. Thus opening a trading position before the news looks more like gambling than trading. So wait before the events will be announced and you will be able to know the direction of the market.

3.Open your trades in a correct way. You have to be carful when placing a trading position on the events announcement. Follow the following recommendations to avoid the mistakes:

Prepare yourself 15 minutes before the news announcement. Using the current rate level open two pending orders: one for buy and one for sale. Thus you will be ready for any direction of the market. It is very important not to place the orders too close to the current price. Because before the news announcement the quote may jump to different directions. Your orders must be set in more than 20 pips from the current price. In order to secure your trading, we suggest you to place the stop loss orders as well in each direction.

Every Singapore trader wants to minimize his losses, but unfortunately not everyone knows how to do it. Sometimes we wonder how some newbie traders hoard losses. They wait so long, so we start to marvel to their patience. Their losses increase so rapidly that in most cases they destroy the deposit very quickly. In simple words, novice traders usually accumulate their losses rather than earnings. Therefore, if you are one of such traders, you need to abandon your current trading approach before it is too late. Though it may be very easy to say it is definitely not so simple to do. How can we teach ourselves to follow this rule? Actually it is not so hard. If this bad situation of increasing losses happens to you frequently, then either you have no experience in Forex trading or you don’t have a necessary knowledge. No other reason exists.

As you probably know, professional traders suggest putting a stop loss order not just for fun, but for a certain reason. When placing a trading position you must be ready for the losses. Everyone has losses when trading Forex in Singapore, even experienced traders. The difference is that the experienced traders know how to diminish the losses and at the same time maximize the profits. When you sart a trading position you take a risk and therefore, if the risk is justified you have profits, if not, you have losses. As for the stop-losses, so you need to know how to place them. We realize why many traders don’t like to limit their losses, because as soon as they set a stop-loss order, it is executed. If it happens with you often, the reason might be in the wrong price that you choose for placing a stop-loss order. Probably you put your stop loss orders too close to the market and for that reason they are executed very often during the market’s fluctuations. It is recommended to set a stop-loss order on the basis of support and resistance levels of the market. Then it will be executed only if the situation on the market considerably changes.

Stop-loss order is a must for any trader. Quite often, there are strong movements on the financial market. At this moment, your intention to close a trading position with your Singapore online broker will be fulfilled with a delay. And if your trade is at a loss, so before your trade is closes, you will lose even more money. But if you would place a stop-loss order, the position would be closed automatically for the asked rate.

If you don’t wish to set a stop loss order, then do the following. Before you decide to leave a loosing position, simply calculate the market’s potential. Make an analysis and check the economical news calendar. In simple words, when leaving a loosing position you have to base you decision on something, and not just hope for the best. In the Forex market, good luck is very changeable.

Due to the popularity of Forex trading in Singapore there are thousands of newbie traders who wish to trade Forex in Singapore. In this article we will show all beginner Singapore Forex traders how to manage their trades. Whenever you start a trade, you have to write down three numbers: the price of entry, the goal and the price of the protective stop-loss. Let’s discuss each of these numbers.

The price of entry. Plan your entry to the market beforehand. You should not hurry up every time and try to place a trade when the price chart on the screen looks tempting. When you place a trading position we advise you to avoid the market orders or instant orders. It is more secure to use the pending orders. Limit orders avoid slippage, which in many cases is the main reason for losses and unsuccessful trading.

A target. Before you plan a trade, you need to decide where you want to capture the profits. Beginner traders often open trades without planning their leave, being sure that they will manage the trading position when it is open. They hope that the trend will proceed to the maximum values, but in practice they probably will close the position at the wrong time when the trend starts to move to the opposite direction. The novice traders must set up the levels of targets in advance, because they simply don’t have sufficient skills to make a decision to close a trade if the market’s situation suddenly change.

Stop-Loss. When people ask us what our expectation for gain we sometimes say: 100%, because we hope that each trade will be successful, otherwise we wouldn’t open a position. Unfortunately not all our orders bring us money. But there is a difference between the big and small losses. In order to minimize your losses we advise you to use the protective stop-loss order. It allows you to leave the market if it moves the wrong way and protect you from the big losses.

Profit/Risk. It is calculated as the distance from our entry price to the target divided by the distance from the entry level to the stop-loss level. For us this share should be at least 2:1, otherwise there is no reason to open a trade. 3:1 share is even better and if you are patient and know to follow the market very carefully, you will be able to catch 4:1 and even 5:1. The higher the share, the more potential you have to close the position with a profit.

Finally, if you want to be a successful trader you have to train yourself to avoid emotions. We hope that the definition of the three most important figures for each transaction will help you move to a higher level of professionalism.

The financial success of a Singapore Forex trader depends on many things, among them is the ability to adequately and comprehensively understand the situation in the financial market. There are few main types of analysis of the financial markets. In this article we will discuss one of them – fundamental analysis. It represents a deep study of the political and financial situation in the countries whose national currencies are traded in most of the currency trading platforms Singapore.

It is not a secret that the political situation of every country has a big impact on the financial sector of a country and as a result forms the rates of the national currency. Traders who trade according to the fundamental analysis must always be aware of economical situation of the world major countries. There are few leading world’s news agencies that can provide you with all needed information: “Bloomberg”, “Reuters”, “France Press”, etc. After analyzing the economical or political situation in the certain countries, a trader concludes whether there is a chance for a national currency to go up or down. Basing on his conclusion, a trader makes a trading decision for buy or sell. This is how the fundamental analysis works.

We would like to draw your attention on the type of the information available for fundamental analysis. It can be divided into two groups: predictable and unpredictable. The first type includes the data that is announced in a certain time and a trader has an idea about them. Moreover such news has a partly novelty effect, because traders already have got familiar with the experts’ predictions about them. Usually this type of news is about the macroeconomical situation of development of a particular country or the whole region. The most common data of this group is the inflation rates, indicators or economic activity and unemployment, budget deficits, interest rates, etc.

As for the unpredictable factors, so they usually are the all kind of unexpected events mainly in the political sphere. For example the unplanned resignations in the government – the President, Minister of Economy and Finance, Central Bank chairman, etc. Among the unforeseen factors in fundamental analysis can also be natural disaster, military conflicts, terrorist attacks, etc. These aspects are the real force majeure, whose influence on the financial market may be quite noticeable. Forex traders simply need to take them into account when trading.

In the beginning traders may ask a question how they can know all the events of a country or the whole world. The reply is very simple. Today most of the brokerage firms in Singapore provide their traders the most updated world news and economic calendars that are important for fundamental analysis. Therefore traders don’t have to lose time on searching for information. The most important thing in the fundamental analysis is to know how to identify the signs for the potential situation in the Forex market.

Trading with the financial news is a part of the fundamental analysis of the market and is widely used Singapore Forex trading. According to this strategy a Singapore trader carefully follows the economical events and starts trading when a good situation shows. Many educational materials recommend start Forex trading from the fundamental analysis of the Forex market. Any change in Interest rates, retail sales and other important financial data may have a huge influence on the relevant currency rates and cause spontaneous trends. Such moments are the Golden Mine for the fundamental traders, as they offer a short opportunity to earn big profit.

Most of the Singapore brokers have an economic calendar that shows the coming financial events in the certain countries. If after the announcement the rate was much different from the expected one, this is a good indicator for the big price movements in the next couple of hours. The trend may start at the very moment of the announcement or few minutes later.

The speeches of the world economical leaders and ECB meetings also may have a big influence on the market. Many traders may also see a lot of good opportunities for making profits during such events. Do not take a trading decision once the meeting has started. The thing is that during such events the performance of the influential persons and experts in the field of economics begins to shake the Forex market. Be calm and don’t yield to the temptation of easy profits as it can cost you significant losses. Wait for a final data.

If the final information was far from expected it is a good chance for a strong trend to take place. Usually if the data of the announced rate was worse than expected, the price of the national currency must decrease. If the data was better than expected, then the upward trend is going to take place. Once you see the starting trend, you can enter the market. When opening a position, don’t risk a significant part of your investment. Sometimes the market is very changeable and other factors may influence it at the same time. Try to minimize your risks and carefully watch your trade after you open it. Remember that a trend may last for a very short time and suddenly change its direction.

If the trend keeps going your direction and your open position starts bringing you profit, we suggest you to use a strategy of profit fixation. It can be done by moving the stop-loss to the direction of the price change. You can replace the stop-loss order on about 20 pips lower/higher from the current rate in the profit area. This strategy is very helpful during the trend trading and guarantees a certain minimum profit on each open position.

Signals are very popular among Forex Singapore traders now-a-days. Online trading signals are the signals for buying and selling of a foreign currency. They show the time and the price level when opening and/or closing a trade has the highest potential for making profit. Services that provide trading signals usually have a professionally developed trading system which according to them is effective and must be profitable. The price of such trading signals is usually not very high and returns to the trader who uses these signals.

How can we check if the trading signals are worth their money? The best factor is the opinion of people who you trust. It might be your relatives who have already used those trading signals and can share you their results. If you personally don’t know people who have already used the signals, you can look around and make your own research before buying the certain signal services. As a rule the owners of the trading signals usually let their customers get familiar with the history of trading transaction made according to their signals on their own trading accounts with one of the Singapore brokers. With the help of these data you can see the effectiveness of the trading signals provided. If the signals provider doesn’t give the statistics of trading with its signals, it is better if you look for a different signals provider.

Usually the Singapore Forex trading signals providers do not guarantee the effectiveness of their product. As well as the money management servicers don’t give the return of the capital in case of the losses. In both cases the risk lies on an investor. The best way to test the effectiveness of Forex signals is to make a short term subscription to them and evaluate their effectiveness on your own. Of course, you can waste some money if the performance is not good. More than that some signals providers require the minimum subscription for more than a month, which is uneasy if your purpose is just to test them out. In any case you will have to find the way to solve it and check the signals before you buy them for trading with your money.

Subscribing to Forex trading signals is very similar to the money management. In both cases you rely on the professionals, rather than research the market and execute positions on your own. In the first case you pay a fixed amount for the subscription and independently execute the transactions through the platform of your forex broker based on the received signal. In the second case, you trust to someone else to execute the transactions for you and manage your funds, but you share with them a part of the profits generated in your trading account. In both cases you take all risk of loss if the situation in the Forex market will be against you.

There are many trading portals about trading in Singapore that offer to subscribe to Forex trading signals. What are these signals and what advantages they give to a trader? Can the usage of these signals be positive and what is the difference between using the trading signals service and the money managed accounts? In this article we will discuss these points and give you all needed information about currency trading signals.

For a start you need to look at the currency pairs that you get signals for. Most of the trading signals are provided for the major currency pairs such as EUR/USD, JPY/USD, GBP/USD. If you are searching for the trading signals for cross currency pairs, you will need to spend more time searching for them on the web. The signal you receive gives you moment of opening a trading position for a certain currency pair and its closing with a profit (take profit) and loss (stop loss). In some cases, the providers of trading signals suggest to use the trailing stop-loss, which changes automatically accordingly to the price in order to fix the maximum profit. In this case the level of stop loss is moving as long as the price goes your way. Being in the profit area, it guarantees the closing of your trading positing if the trend will go against you and hit the stop loss level.

Usually currency trading signals are sent in a certain time. The most popular trading signals are offered for the daily trading. They can be received with an interval of several hours. Signals, which are focused on long-term trends in the financial market may be sent few times a week. By subscribing to the Forex trading signals, you have to be sure that you know whether these signals for short, medium or long term trading.

Before you pay money for the subscription to the currency trading signals, we recommend you to contact the signal provider via email or telephone. Make sure that you are dealing with a professional Singapore trader and ask him as many questions as possible. If after you paid for the subscription to the trading signals, you don’t get the support from the provider, then you should search for other Forex trading signals.

In the conclusion to this article we would like to offer to beginner online traders to thoroughly examine the Forex market and its basic principals of trading before you purchase the subscription to the currency trading signals. Each of you has a certain potential to become a successful Singapore Forex trader. But if you don’t learn to make decisions in Forex market you will never develop this potential in yourself. More than that it is much better if you close the trading positions with a profit making your own independent decision basing on your own trading strategy.

When talking about Forex, new traders usually say play Forex, as they consider Forex as a game where there are winners and losers. This is what distinguishes a beginner trader from a professional one. A professional trader will never say play Forex, he will say trade Forex. As soon as a newbie trader understands the whole big picture of Forex trading, he won’t call it as a game.

Currency trading as any other game is accompanied by an excitement and emotions of the players. The biggest chances to win have the participants who have a strong character and the ability to cope with the emotions. To trade online you need to have as much self-control as in the poker game. Emotions are not assisting the traders in currency trading, on the contrary they can ruin your trading. Very often when a big investment is involved in online trading, many traders make bad mistakes due to their emotions. They forget one simple rule – to make profit in Forex market you need to be the master of your own money and feelings. You need to experience as little feelings as possible when trading currencies.

So if online trading is compared to a game, where are the opponents? Is it a game of partners? Generally speaking currency trading in Singapore is a two-side game. One side is winning the money of the other party that is losing. But not all participants are actually trading Forex. There are those parties who stay as the sponsors of the trading and don’t wish to gain. In simple terms, not all take part in currency for trading currencies. There are many huge industrial companies that exchange currencies to buy different materials abroad. Millions of tourists around the world exchange currency to go to a trip to the neighboring country. The goal of such individuals and companies is not the earnings on the currency exchange. Their goal is to own a foreign currency.

As any game has a main award, the paradox is that to win the main prize of Forex game is impossible, it can be done only by realizing that this game is in fact a serious business activity. Once a games ends to be a game, the main award stops to be a prize, but becomes the expected return – profit. For that reason there are only losers in the Forex game, but in Forex trading there are many successful traders. Their income depends only on the level of their intuition and trading experience. If you are a beginner trader in Singapore Forex market we wish you to delete the idea of playing Forex as a financial game and open a window to a real Forex Singapore trading. This is the only way to succeed in Foreign exchange trading.