Can You Make Money with Automated Forex?

By Chuck Kessler

It is really easy to make money in the currency trading markets. The only problem is if you don't know what you are doing it is real easy to lose money too. With the invention of automated forex software, however, times have changed and you can make money in the currency markets even if you don't know a thing about them. I am going to tell you how to use these software programs to make money, and you don't need a large upfront investment.

Obviously to do automated forex you are going to need software. There are tons of automated forex robot type softwares on the internet, some are even free. The way these work is you install them on your computer and leave your computer on and the automated forex robot will do the trading for you.

You don't want to turn that computer off. If the software is in the middle of a trade you might get stuck with a bad invesment. You also want to set your risk tolerance to the level which you can stand. Everyone has a natural tolerance for risk. The less risky your setting the less money you will make in the short term. Just like any other investment the lower the risk the lower the return.

If you opt to go for a more aggressive approach you can make a lot more money, however you can also lose a lot more money. The basic fact is the more risk the more return. Obviosuly, more risk also means more chance of losing your money.

Automated forex software uses historical data, signals, and trends to make decisions on what currency to trade. The currencies are changing every day because of the economy, and when the market is like that there is money to be made if you know what you are doing. Lucky for you you can employ a robot who is unemotional to make the decisions for you.

I suggest you go out today and get your currency robot software. You just need to go through a few simple setup steps and you will be on your way. Make sure to leave that computer on while you sleep. There is no better feeling in the world than making money when you sleep. - 23199

About the Author:

If this all sounds too complicated for you, visit my website for further information on automated forex. I give you additional tips, and can even tell you softwares that are proven to work!

Trading Online Based On The Relative Strength Index

By Chris Blanchet

For investors looking to learn stock market investing, technical analysis often provides an unbiased and objective reading on whether or not to take a position in a particular security. As noted in the balance of the series, some technical analysis is simple while the rest can become complicated, particularly for those who are trying to learn stock market investing techniques. The Relative Strength Index of a security is medium to difficult.

What is the Relative Strength Index (RSI) The RSI is an oscillator that measures a security's "relative strength" against its own price history. This technical indicator allows the investor to determine whether the security is currently overbought or oversold and, in fact, provides a better indication of support and resistance levels than the security's price chart would.

How Relative Strength Works Unlike some of the other oscillators covered in our technical analysis series, the RSI is plotted on a scale of 0 to 100. The key levels to remember are 0 to 30 for oversold, 30 to 70 for in range, and 70 to 100 for overbought. Depending on the investor's strategy, these numbers can have different trading implications.

Figuring out the RSI In terms of mathematics, maintaining an ongoing RSI chart is more involved than some other technical analysis calculations. To figure out a security's RSI, we use this formula: 100 - [100/(1 + A)] where A consists of the average "up" days divided by the average "down" days over a predetermined time frame. For example, if a stock closes up 7 days and down 7 days of the past 14 days, then the RSI would be 50.

Using RSI to Trade Securities The RSI is more useful than just providing buy or sell signals to investors. First, the RSI will show areas of support and resistance more clearly than security prices would. Second, overbought and oversold conditions can help determine whether one should sell, buy or hold an existing or non-existing position. They are not typically used on their own to trigger a buy or sell as they provided bearish (0 - 30) and bearish (70 - 100) signals. Using tools such as the RSI to determine safe or unsafe points of entry and exit is really the whole purpose of technical analysis in the first place.

Trading software can alleviate a lot of the time consuming and draining calculations needs to produce a solid buy or sell signal. Although technical analysis involves many aspects and signals, such software can change an individual investor's experience from overwhelmed to simple... or at least make it simpler. - 23199

About the Author:

Chris Blanchet has over 16 years as a Financial Advisor. Read more about online trading and receive complimentary access to the Technical Analysis Series at Online Trader Today.

Following Oil in Currency Trading

By Ahmad Hassam

If you want to become a good currency trader, then you need to understand that the forex markets evolve and change with time. You will need to make a little tweak here and a little tweak there sometimes in your trading strategies in order to continue making profit. As the currency markets evolve and change, your trading strategies should also evolve and adjust to these changes in the markets.

There will be periods of low returns or losses. But once you have made the changes and adjusted your trading strategies, you will start making profits again. Dont get stuck with only one currency pair and one trading strategy. Start looking at macroeconomic events and how different currency pairs react to them.

Now, lets discuss a trading strategy that depends on following oil prices in the markets. There are many sources of oil. Some currency pairs react more strongly than other when oil prices change. Fortunately for you, oil prices trend for extended periods. When oil prices rise, they continue to rise for several months.

Almost in the same fashion, when oil prices start declining, they tend to continue declining for several months. In 2008, we saw oil prices on the rise for several months before a sudden collapse. Oil prices than stabilized around $55 for many months. Some of the currencies that react strongly to oil price changes are British Pound (GBP) and the Canadian Dollar (CAD). Lets focus on USD/CAD currency pair in our example.

United States imports more oil from Canada that any other country. The value of CAD should increase with increase in oil prices in relationship to USD. With the increase in oil prices, this means that the pair USD/CAD should start trending downward. This is an example of a trend trading strategy.

Do you watch CNBC daily? You should watch for times when the oil prices are rising and the exchange rate USD/CAD is decreasing. Similarly, on CNBC look for times when oil prices decline and the exchange rate USD/CAD increases.

Use CCI, Commodity Channel Index, to trigger your trade. Watch for the 14 period CCI (Commodity Channel Index) to cross above 100 and then cross back below 100. This will tell you that the buyers have made a temporary upward push on the currency pair USD/CAD but were unable to turn the trend around. The trend is still downward.

Enter the trade. Set a limit order of 300 pips and a stop loss order of 75 pips. Go short on USD and long on CAD. This setup gives you a risk to reward ratio of 1:4. This risk to reward is very good and it allows you to be wrong a few times but without ruining your chances of being profitable. 300 pips mean $3000 profit and 75 pips means $750 loss if the trade goes against what you anticipated. Usually such a trade will continue for a month.

Prolonged downtrends in the oil prices are usually unlikely. You can also trade the USD/CAD currency pair in the opposite direction if the oil prices start to decline if it does happen. You can take advantage of the oil price movement. This trading strategy depends on just knowing which way the oil prices are moving right now. Oil prices have again started to climb. Prices have reached around $68. Take advantage of the rising oil prices by trading USD/CAD currency pair as described above. - 23199

About the Author:

Mr. Ahmad Hassam is a Harvard University Graduate. He is interested in day trading and swing trading stocks and currencies. Discover A Revolutionary New Forex Robot. Develop your own Forex Trading System.

What is a Hedge Fund?

By Sara Ferguson

Heres the first thing you should know about hedge funds: They have no clear identity or definition. In the investment world, I run a hedge fund has the same meaning as Im a consultant in the rest of the business world. The speaker may be managing money and making millions, or she may want a socially acceptable reason for not having a real job. The person who really manages money may go about her business in any number of ways, from highly conservative investing to wildly aggressive risk taking. She may be beating the market handily, or she may be barely squeaking by.

Im not trying to say that the term hedge fund means nothing. Heres the short answer: A hedge fund is a lightly regulated investment partnership that uses a range of investment techniques and invests in a wide array of assets to generate a higher return for a given level of risk than whats expected of normal investments. In many cases, but hardly all, hedge funds are managed to generate a consistent level of return, regardless of what the market does. Before I get to the longer, more complicated explanation of hedge funds, however, it helps to know exactly what hedging is.

Hedging means reducing risk, which is what many hedge funds are designed to do. Maybe youve hedged a risky bet with a friend before by making a conservative bet on the side. But a hedge fund manager doesnt reduce risk by investing in conservative assets. Although risk is usually a function of return (the higher the risk, the higher the return), a hedge fund manager has ways to reduce risk without cutting into investment income. She can look for ways to get rid of some risks while taking on others with an expected good return, often by using sophisticated techniques.

For example, a fund manager can take stock-market risk out of the funds portfolio by selling stock index futures. Or she can increase her return from a relatively low risk investment by borrowing money, known as leveraging. If youre interested in investing in hedge funds, you need to know how the fund managers are making money.

Return is a function of risk. The challenge for the hedge fund manager is to eliminate some risk while gaining return on investments " not a simple task, which is why hedge fund managers get paid handsomely if they succeed. - 23199

About the Author:

How to Invest Today is a site dedicated to helping beginning investors learn the basics to the advanced of investing.

Why Trading Price Action Is So Important

By John Templeton

If you find yourself having a really difficult time grasping the intricacies of the forex market, then you are definitely not alone. There are tons of new and struggling traders out there. I know that if you surf around the internet enough, you will find hundreds of thousands of articles on forex trading. Its enough to give you a headache. I can certainly empathize because I remember going through the same thing when I first started.

It always feels like there an infinite amount of people telling you millions of different things. Most probably tell you about a trading system which uses a whole slew of indicators, and all you have to do is just follow them and you'll be rich, right?

I'm going to have to give you some startling news. Trading with generic indicators like stochastics or moving averages, and using them as your only reason to take a trade, you will not see a whole lot of success trading the forex market. Understanding price action is so critical if you want to make money long term. After all, its the basis of technical analysis.

This is just some of the many reasons to trade price action:

You get to actually see the real support and resistance areas. I'm also not talking about those s/r areas that you get with one of those indicators. The real support and resistance on a price chart cannot be calculated by an indicator.

You can actually understand what the market is doing. You get to see the market's energy and you get to see the underlying reason as to why the market moves the up and down the way it does.

You are able to predict vital turning points in the price. I can't begin to tell you how important this is. What's also great is that you can trade all kinds of time frames. You are not limited to being a short term or long term trader. It goes to show that price action is for everybody.

It makes no difference the kind of market that you trade. You can trade forex, stocks, e-mini. It really doesn't matter because it is so universal. - 23199

About the Author:

If you want to learn price action, then you definitely check out winning in the forex market.