Making Better Forex Trades By Using A MACD Indicator

By Samo Yanezic

When you make a MACD Indicator part of your Forex strategy, you can see much more consistently profitable trading activity; and keep your losses to a minimum.

If you`re not familiar with the term already, MACD stands for Moving Average Convergence Divergence. This can assist you in deciding which trades have the best chance of being profitable for you and which you should trade short on or avoid altogether.

Foreign currency exchange markets move quickly; a trade which can work wonders for you right now may be in a tailspin a mere few hours later.

Like any kind of investment, being successful in Forex trading means using tools which help you predict the movements of the market and well thought out trading strategies which lead to increased profitability. Using a MACD indicator shows you the trends in currency prices in real time as well as showing you longer term trends, so you will be able to decide exactly when the ideal time is to make your trades.

How Do MACD Indicators Work?

The MACD is composed of a few different moving average indicators, each of which is pretty straightforward. One is the signal line (also known as the water line). This shows you the exponential moving average (EMA, for short) drawn from closing prices over the last nine days of trading in the currency market.

The upward or downward trend of a given currency are based on two different EMAs. There is a 12 day EMA as well as a 26 day EMA; taken together, these figures give you a better picture of the movements of this currency.

The MACD line of the currency you`re watching may fall below or above your EMA signal line. The position of this line relative to the MACD line tells you whether the currency is on its way up or down.

Using A MACD Indicator For Forex Trading

Once you learn how to read the charts and come to an understanding of what the MACD`s movements mean you will be able to make better trades more easily. As any experienced Forex trader can tell you, knowing the trends in the foreign currency exchange market makes all the difference. Thanks to the one and four hour charts your MACD indicator will give you, you`ll be able to see the prevailing trends in the market and take advantage of them.

By learning to watch both sets of charts you should be able to pin point which currencies are trending upwards and which are trending down. When both the 4 hour and the 1 hour MACDs are trending up your chances of entering a profitable trade are more likely.

Before placing any trades, you should consult your hourly chart to see how the MACD indicator is moving. If the MACD indicator is above the waterline, then you have better odds of making a profitable trade by going long.

It is important to keep in mind that any investment comes with a degree of risk and there is no one tool or indicator which guarantees a successful trade every time. Using a MACD indicator along with other tools and a solid knowledge of the workings of the Forex market can make your Forex trades more profitable, however. Of course, even if you use the MACD indicator alone to help you make your trading decisions, it will still provide you with more consistently profitable trades than going it alone.

If youre looking for ways to help increase your success rates with your own forex trading strategies, then perhaps using an MACD indicator could be the ideal investment tool for you. - 23199

About the Author:

About the Author: Samo Yanezic is the Webmaster of Financial Freedom Informant.com - Your Free Complete Guide and the Internet`s Rising Source for Online Home Business and Investments Education. See also this About Forex page.

Forex Trading- Time to Enter

By fx report

Today as the world's economies start to slow down, many people are searching for how to generate extra income to protect themselves for the upcoming tough times ahead. So what are you doing to help you generate extra income? Many smart traders are turning to the stock markets and forex markets to help them generate extra income.

This is the decision that can quiet often get overlooked, the entry decision. The other big decisions in trading and investing, such as how much to trade, or what your exit plan is, is the timing right etc.

But the truth is that whether you're a trader the entry decision is crucial as without this decisions the other decisions cannot take place.

It is quiet often seen that new traders often worry about their first entry point, trying to make it perfect and there are some important points to be considered when you're entering into a trade. It is therefore crucial to take a glance at this often overlooked subject.

Which brings to another important point, what platform are you looking to enter the trade through? The CFD FX REPORT has recently researched the CFD an Forex Brokers, looking carefully at the subject what company gives the best fill prices, no slippage to find out more visit the website or if you are looking for a forex broker or CFD provider.

IT IS RIGHT TO ENTER:

Now for the bad news. Most traders believe there is no perfect entry point signal when it comes to trading. Sound Strange.

But there are certain things things to look for to help guide you towards the correct time. So lets take a look at the simple market rules.

Dust OFF the Charts:

You can base your entry decision using technical analysis, what this can do is increase your chances of entering the correct trade as the best time. It can be benefical to look at the sectors and what sectors are performing the best? Is your favourite trading company in a strong sector? Is the overall sector performing?

Most great companies belongs to a great sector, because it is very rare that a company's stock price will move in the opposite direction of its overall sector for an extended period of time. They tend to follow one and other.

In an nutshell, you should use technical analysis to follow the underlying trend for your stock that you are looking to trade, especially when entering. The underlying trend is the most important consideration when entering a trade at the correct time.

Remember the old saying, Trend is your Friend.

Listen to the Facts-

Today as the world's economies start to slow down, many people are searching for how to generate extra income to protect themselves for the upcoming tough times ahead. So what are you doing to help you generate extra income? Many smart traders are turning to the stock markets and forex markets to help them generate extra income.

Make sure it is very simple. Do not over complicate it.

Keeping it simply, is often the best strategy. How often do hear it . Thorough research, an understanding of what you want from your trades and a commitment to your trading strategy is so important when it come to trading and more importantly making money from it- but quiet often we want to make it seem difficult. Simple is simply the best.

Try not to over complicate it, why It's no good trying to base a decision looking at numerous indicators crossing each other at various angles, changing colours, and a host of other useless information.

Of course, employ a technical analysis of the company in making your decision, but there is no need to go overboad.

After all, trading plans are easier to follow if they are simple.

If you are a long term trader is it not just timing the market, in this instance it is time in the market.

Remember use your rules, make it simple, and the profits should follow

As we have discussed in the article the most important steps you can make as a trader is education. As you are responsible for creating your own wealth so to continue learning and for more free education lessons please visit the CFD FX REPORT they will be able to satisfy all your education requirements. Also they can help you find the Best Forex Broker and CFD Brokers in the market. Visit them today. Education is knowledge and knowledge helps create wealth. - 23199

About the Author:

The CFD FX REPORT is a real time trading tool that offers clients free trading reports, with trading ideas, stock market and forex market education as well helping them with. Also if you are looking for a Forex Broker, then feel free to visit our broker section as we recently reviewed all the forex brokers and have found the best on the market.

Using the Forex Trading 80/20 Rule

By fxreport

Are you looking for simple forex trading ideas that you can use in your forex trading system to help you achieve higher profits from your forex trading instantly. Well it is time that you looked at this, it will add excellent profits to your forex trading.

The major problem is that a lot of forex trader's face is that they don't know about the 80/20 rule and the power of this rule. This rule is a common rule that is used everyday in business and this rule is very applicable to forex trading. So what is the 80/20 rule, it is simply that 80% of your sales will come from just 20% of your clients. So how does this work in forex trading?

It means that you will find that 80% of your forex trading profits will come from just 20% of your trades- so what this means is that you should be doing less trades and focusing on the high odds trades. So what this means is that less trades is often better. So many new traders make the mistake of over trading, which more than often means they will end up broke.

The 80-20 rule is one education lesson that all new traders should learn as fast as they possibly can as it will make them a lot of money. For more free education lessons feel free to visit the CFD FX REPORT they have many free education lessons available and they can help you find the best Forex Broker in the market too.

Many inexperience forex traders think they need to trade all the time and the more they trade, the more they will make in terms of profits. Most forex traders therefore try and scalp and day trade and just take low odds trades and lose.

The professional forex trader focuses on the long term trends and big profits and many trade just once a month or less and turn in 100% annual gains.

Once you learn how to use forex charts you will often see that big trends will often last a long time, and in some cases months, so if you get into these trades hold them and trail up your stop loss this will improve your profits.

If you want to make more money in less time, focus your forex trading on long term trend following via breakouts and only take high odds trades. If you do this, you will make a lot more money, with less risk and in less time. - 23199

About the Author:

The CFD FX REPORT is a real time trading tool that offers clients free trading reports, with trading ideas, stock market and forex market education as well helping them with. Also if you are looking for a Forex Broker, then feel free to visit our broker section as we recently reviewed all the forex brokers and have found the best on the market.

MetaTrader EA - Automated Forex Systems at Their Very Best

By James Smith

MetaTrader EA trading systems have become immensely popular in recent years, as people have avoided the stock markets and started to trade with automated forex systems instead. Expert advisors run off the MetaTrader trading platform. This world renowned forex trading plaform is a free of charge online platform, and includes the use of built in technical advisors you can to monitor the market. The MQL4 software programming is used in the usage and development of automated forex systems. Metatrader EA is a program that can be installed into metatrader software. It is written in the MetaQuotes programming language version 4. It analyzes charts, and even closes and opens trades for you.

Nevertheless, Metatrader EA is not a passport to riches, and many traders lose money, primarily because of inadequate money management. They don't follow simple steps, which is to quickly take your profits then cut your losses short. Although its sounds straightforward, people find this hard to do because they are fearful and inconsistent. After a few rounds of trading they will most likely lose all the money. Thus an automated system can take away this fear, and emotion, from trading.

A successful trader will consistently take profits as soon as possible and cut losses are all losing positions. You also need to find currency pairs that will indicate a possible win. All these strategies are incorporated in the metatrader EA and that is why it is essential to have robust automated forex systems in place.

A metatrader EA should have the following features in order to guarantee consistent wins. Get an EA that has a low drawdown percent. This means that it will easily detect many winning trades compared to losing trades. To make sure you have less losses this expert advisor should have a stop loss policy.

The Metatrader EA that you choose should prove that it meets the following requirements. You need to find one that runs 24/7. It should always look for winning trades and cut losses to a minimum. It should be consistent with no greed or fear for all currency pairs at the same time.

Basically, a Metatrader can save you a lot of miserable heartache if you are an emotional trader you might want try trading an automated forex system yourself by the use of multiple monitors for a day - this will require monitoring the market 24/7, which is not feasible in the long term. It is clear that automated forex systems are the way of the future with regard to forex trading.

If you are using the metatrader EA together with automated software you will need to use multiple screens and customize your view. While away from your computer, sms alerts and live updates from all currencies will be useful.

If you consider the above factors and issues whilst using your metatrader EA, this will provide a solid platform which will let you trade successfully and emotion free. This will also eliminate all subjective fear and ensure that you become a profitable trader using automated forex systems. - 23199

About the Author:

James Smith is a professional trader and a developer of MetaTrader EA's and automated forex systems. He operates a foreign currency trading advice website called The Forex Village which gives free help and assistance on selecting a suitable MetaTrader EA and on a variety of other currency trading related subjects.

Global Macro Investing and the Benefits of Multiple Asset Classes

By Bruce Jones

Anyone that has been trading for a long time has heard that diversification is the only free lunch our there, referring to the economics principle that nothing good is free. The problem has been that if you went to the typical financial planner you were deworsified and not diversified. Dont worry because diversification is still very useful if done properly and really does help to increase returns and lower risks.

The typical planner will have you put some of your money in domestic stocks, some in foreign stocks, and then place some money in bonds. If that is all you are doing you are not getting nearly the benefit you could be getting and in reality you are barely diversified at all.

Diversification done right will not only have you invested in several different asset classes but also in multiple strategies inside each asset class. Ask a global macro trader why they trade this way and they will tell you that being able to go into multiple asset classes is the only way to consistently generate positive returns regardless of what the stock market is doing.

Global macro traders diversify into asset classes such as domestic stocks, foreign stocks, Treasury bonds, investment grade corporate bonds, junk bonds, foreign government bonds, foreign corporate bonds, commodities, real estate, and currencies. Some traders even trade in collectibles like art. Why do they cast their investment net so wide? For the simple reason that one asset class may be in or out of favor at any given time.

One of the best known although regularly ignored tenets of successful investing is to look for the best risk to reward situations. If you dont focus on risk then it will come back to haunt you and cause you to lose lots of money. By looking across multiple asset classes you will be better able to find great risk to reward scenarios as not every asset class is always in a good position to make you money.

Of course as alluded to earlier we can diversify in more than one way. Cast your net wide and put money is several asset classes but you can also diversify by looking at different trading horizons. For instance if you can manage multiple strategies in the same asset class then do that, if you cant hire an outside manager that can. For instance you can put money with an uncorrelated commodity trading advisor and then put money with a long term trend following commodity trading advisor. By doing this you are catching short term and long term movements in commodities. You can do the same types of things with other asset classes.

If you diversify wide and deep your investment returns will be far more consistent and in most years will be better off then the standard stock and bond mix that so many so called professionals push you into. There is no guarantee that you will make money every day, month, or even year but by following these concepts you can really improve your risk adjusted returns.

If you are like most people these days and are managing your own investments then you will likely want to learn how to build trading and forecasting models to help you spot more opportunities. The more streamlined your research is the better your results will be and the better your returns will be. - 23199

About the Author:

The Macro Trader helps investors find great Global Macro Trader opportunities. Volatility Trading is but one of the many strategies that we use to help find the best risk to reward opportunities across the globe.