How to create your own currency trade system

Currency Trading Systems - 4 Steps to Creating Your Own For Big Profits!
By [http://ezinearticles.com/?expert=Kelly_Price]Kelly Price

If you want to trade currencies you need to create a currency trading system and you can do this yourself it's a lot easier than most traders think and here we will give you 4 steps to create a currency trading system that can make big gains.

Here we are going to look at getting a long term trend following currency trading system together.

Spotting Opportunities

The first step in any currency trading system is spotting opportunities and here you need to look at the concept of support and resistance - it's easy enough to learn and if you don't understand why it's important there is plenty of free information on the net.

To keep the odds in your favour be selective in trades.

You don't get paid for trading more you get paid for being right and you need to make sure support and resistance are valid - at least 3 tests and the more the better. The wider the tests are apart the better too.

The next bit is the hard bit - will support or resistance, hold or break?

Next we are going to cover how to avoid the major errors that causes most traders to lose with their currency trading systems -make the error to and you will lose.

The first error, is trying to predict where the market will go. If you try and predict you will lose, as its simply another word for hoping and guessing and that wont get you anywhere in life, particularly currency trading.

Forget predicting and people who tell you it works - it doesn't.

The second error is trying to "buy low and sell high" which is actually related to the above point.

You learn it at school and it would be great if it worked in practise - but the fact is its again hoping or guessing, as in most instances, when you try and buy a low price momentum is moving against you and levels break more often than they hold.

This leads on to our next point.

1. Confirm the Move

For example, if prices move to support don't just jump in and buy WAIT For price momentum to turn around and go the other way - this is the reality that price is moving your way.

Sure, you have missed the bottom but as you can't judge where prices will bottom in advance that's not a problem. Catch 60 - 70% of a trend and you will pile up a lot of money over time.

So, you have support and resistance to watch and now you need to judge momentum. You can do this with a variety of momentum oscillators and two of the best are the stochastic and the Relative Strength Index (RSI) look them up.

2. Don't Forget Breakouts

You can trade into support and resistance but if they are new highs or lows they are breakouts and the fact is these are the best trends of all and you need to go with them.

Don't wait for the pullback to get in at a lower price - enter your trading signal and go with the break. These are the trades with the best odds and most people wait and remember most people lose!

3. Keep It Simple

You don't get paid for being clever or working hard in currency trading, you get paid for being right - that's it.

If you think that the harder you work on your forex trading strategy, the more money you will make then you are mistaken.

Simple trading systems work best as they are simple to understand, apply and are more robust in the face of brutal market conditions.

4. Stops and Targets

Stop levels are obvious, when you enter a trading signal and are dictated by support and resistance. The problem most traders have is they move them to quickly - do this and you will get clipped out by normal market volatility - if you are trend following keep them well back and trail them up slowly.

You may have to take dips in your open equity but that's simply the way it is so get used to it and keep your eyes on the bigger prize.

The above are the basics to consider when devising a currency trading system and its easy enough to do - the hard part is following a system with discipline but you can if you follow the points above.

Why?

Because you will have created it and understand how and why it works - this leads to confidence and discipline follows as a result.

Good luck with building your currency trading system - you can do it with a little time and effort and make some great forex profits simply have confidence in yourself and follow the above points.

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4 Steps to Purchasing a Forex Course

By Bobby Winford

Purchasing a forex course can be a lot like going into a bubble gum factory asking for a sample piece of gum. You have to know what flavor you want, what shape, etc .. When you purchase a forex course there are four steps I outlined in order to help you narrow down what to look for in a forex course.


Step One - Figure out how much money to invest in a forex course. This should be money that you can afford to lose. Most people cannot afford to lose money. Make sure that losing this money won't devastate you financially.

Step Two - Make sure the forex course costs less than 50% of the money you have to invest. The cost of the course will not be invested directly in the market. You want to put most of the money you have to trade into your trading account.

Step Three - Make sure that the course does not have any hidden costs. You do not want to have to pay for any subscriptions. You should also find out if the company that sells the course has any paid subscription type services. If they have these types of services, chances are that their system will eventually require that you use them. (free resources however, are always great!)

Step Four - Don't get stuck on the "demo account advertisement." Having access to a demo account can actually lead the forex trader into a false sense of security. It is like paper trading for the stock trader. There is no real preparation for what actually happens psychologically to a trader when his money is on the line. That is why I suggest learning and then starting with a very small amount of capital. The great benefit of the forex trading world is that you can start with $50 (on a good trading platform) and with that $50 have leverage to $10,000 yet only risk the $50, it does not get better than that. Starting with $50 in an actual account is a much more effective route to success in forex trading then getting stuck in the bogus world of the "demo accounts."

If you are looking for a way to make consistent profits through a proven forex program then you have come to the right place: http://www.fxprofits.info

Bobby Winford has been involved in many forms of investment over the years but he is partial to the Forex market, as the possibility of fast and substantial profit has always been attractive.

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