Well, so you have completed your forex education class or learned a new FX strategy from a mentor or perhaps a website. In order to master the strategy and put another weapon in your forex arsenal you must practice, practice, and practice some more!
In my forex trading plan I always allot plenty of time for learning and practicing. I never employ a new forex strategy without study and practice in a demo account.
Do you think Tiger Woods learned how to hit a flop shot during his warm ups for the 2004 Masters and used it later that day to win the tournament? Not on your life! He has been practicing that shot for years and years on the practice range!
You must begin approaching your forex education like an athlete approaches preparing for an event. Spend the largest percentage of your time practicing new trading systems, so when the market favors the FX strategy you are ready to take advantage of the opportunity.
You must maximize your trading potential through practice. Unused potential is easily wasted. If you don’t think this is the case take a look at the 21 Day 3% Rule.
The human mind only retains 80% of something learned within just 3 days!
In only another 18 days after the learning event the human mind only retains 3% of the information!!!
Tiger Woods was quoted saying “it is funny that the more I practice the luckier I get.” As a forex trader we can learn a lot about preparations from following successful athletes.
Remember forex education and preparation is king!
Happy Trading!
Visit FX Trade Central for more forex educational infomration.
Thursday, April 6, 2006
Tuesday, April 4, 2006
Forex Going Mainstream
I was thumbing through the April 3rd edition of Business Week and in the Personal Business Investing section there was an article titled “The Currency Game: Home Version” by Adrienne Carter. The article summarized forex trading and then painted a brutal picture of forex. Forex trading can be a brutal business, but is giving your hard earned money over to a money manager just because you have not taken the time to get financially educated is even more brutal!
On first glance I was glad to see forex being introduced in a mainstream business publication. It also reinforced a psychology lesson I had back at my days at Arizona State University …
Think critically about what you read. Know the sources of your information and project yourself into views of the authors. After that form your opinion based on the facts. I think far too many people take things at face value!
The article was sounded a warning signal about trading the forex market. Addressing the symptoms (forex risk) without truly identifying the root cause (lack of investor education) in my opinion does a great disservice to the readers. That is why this blog and my sites (FX Trainer and FX Trade Central) are dedicated to forex education.
It is just like looking at the technicals while having an understanding of the effects of the fundamental. Learning to evaluate information from many angles without over-analyzing is a great skill to utilize in your trading.
Happy Trading!
On first glance I was glad to see forex being introduced in a mainstream business publication. It also reinforced a psychology lesson I had back at my days at Arizona State University …
Think critically about what you read. Know the sources of your information and project yourself into views of the authors. After that form your opinion based on the facts. I think far too many people take things at face value!
The article was sounded a warning signal about trading the forex market. Addressing the symptoms (forex risk) without truly identifying the root cause (lack of investor education) in my opinion does a great disservice to the readers. That is why this blog and my sites (FX Trainer and FX Trade Central) are dedicated to forex education.
It is just like looking at the technicals while having an understanding of the effects of the fundamental. Learning to evaluate information from many angles without over-analyzing is a great skill to utilize in your trading.
Happy Trading!
Saturday, April 1, 2006
Time to Build Your Storm Shelter
On a recent post tilted “Perfect Storm” I wrote of the impending economic storm that is beginning to form in the American economy. In fact, this storm is brewing in most industrialized nations (thank you Margaret – if anyone still thinks all Americans are rich just look at last years hurricane disaster in New Orleans!). The largest generation is getting older and the working population is getting smaller. The economic systems are not broke; they are just not designed to operate in the global climate of tomorrow.
From the outside the United States and Europe appear to be on separate economic tracks. The U.S. is hard and fast a market-driven economy and Europe leans towards socialist governance. Economist will go on and on about the underlying conditions, but in its simplest form America lets the markets and business dictate the economic path (for the most part) and Europeans elects officials to dictate social welfare. Government retirement is about the same, only the delivery vehicles differ. The European governments rely on a high tax base to delivery retirement benefits to its citizens. America incentives come in the forms of business pension funds and tax-deferred savings plans (made popular by the Employee Retirement Income Security Act (ERISA) of 1974 and to a lesser degree government retirement or social security (Great Depression Era reform and outdated).
This is what we are taught in school and at home!
This is all changing. The European form of social welfare worked well when 80% of the population was supporting 20% of retired citizens. You see this in France where students are actual demonstrating to keep the ‘status quoi’ workers benefits. Governments are recognizing that the current model will not hold far into the future. America is no different, except the deterioration can be seen in the collapsing corporate pension funds, United Airlines being the most infamous. IBM has also recently address there pension concerns by closing the pension to new employees and offering tax-deferred saving plan in its place.
Time to wake up and smell the coffee!
The economies are now globalizing and as change besets the western nations a new economic model is emerging. The economic models are changing and we need to change too! Change is inevitable. Change is also the enemy of retirement planning, but change must be embraced.
What now?
Education is the key. Financial education! We must learn financial skills and take personal responsibility for our financial well being. We must also incorporate financial education in our school systems. When I was in the 4th grade my class had a year long project to select stock on the American Stock Exchange and follow them throughout the year. I was 7 years old and had my first investment class. It was also my last financial lesson in the US educational system!
It is time to build your financial shelter.
Learn a financial skill that will take you forward and allow you to prosper in this rapidly emerging global economy. Don’t expect anyone to take care of you. Financial markets (Forex), real estate, and internet business are my choices. I use forex and my internet business for cash flow and real estate for wealth building. I cannot emphasize enough the importance of education. When I was younger I use to sell stereo equipment at a retail store. It would amaze me that people would spend 80% of their budget on the components and 20% on speakers. Ultimately it is the speakers that produce the sound you hear and should command the majority of your budget. Same thing is true about your financial education. No matter what happens, it is your knowledge that will allow you not only survive the changing economy, but to prosper!
I heard a story once that less than 1% of the world’s population controls 99% of the wealth. If you took all the money in the worlds and divided it up equally amongst the earth’s citizens than within a year that 1% would control 99% of the wealth again. Why? It is because the 1% have financial literacy. Isn’t it time we learn those financial skills!
Happy Trading!
For your forex education, visit me at FX Trainer!
From the outside the United States and Europe appear to be on separate economic tracks. The U.S. is hard and fast a market-driven economy and Europe leans towards socialist governance. Economist will go on and on about the underlying conditions, but in its simplest form America lets the markets and business dictate the economic path (for the most part) and Europeans elects officials to dictate social welfare. Government retirement is about the same, only the delivery vehicles differ. The European governments rely on a high tax base to delivery retirement benefits to its citizens. America incentives come in the forms of business pension funds and tax-deferred savings plans (made popular by the Employee Retirement Income Security Act (ERISA) of 1974 and to a lesser degree government retirement or social security (Great Depression Era reform and outdated).
This is what we are taught in school and at home!
This is all changing. The European form of social welfare worked well when 80% of the population was supporting 20% of retired citizens. You see this in France where students are actual demonstrating to keep the ‘status quoi’ workers benefits. Governments are recognizing that the current model will not hold far into the future. America is no different, except the deterioration can be seen in the collapsing corporate pension funds, United Airlines being the most infamous. IBM has also recently address there pension concerns by closing the pension to new employees and offering tax-deferred saving plan in its place.
Time to wake up and smell the coffee!
The economies are now globalizing and as change besets the western nations a new economic model is emerging. The economic models are changing and we need to change too! Change is inevitable. Change is also the enemy of retirement planning, but change must be embraced.
What now?
Education is the key. Financial education! We must learn financial skills and take personal responsibility for our financial well being. We must also incorporate financial education in our school systems. When I was in the 4th grade my class had a year long project to select stock on the American Stock Exchange and follow them throughout the year. I was 7 years old and had my first investment class. It was also my last financial lesson in the US educational system!
It is time to build your financial shelter.
Learn a financial skill that will take you forward and allow you to prosper in this rapidly emerging global economy. Don’t expect anyone to take care of you. Financial markets (Forex), real estate, and internet business are my choices. I use forex and my internet business for cash flow and real estate for wealth building. I cannot emphasize enough the importance of education. When I was younger I use to sell stereo equipment at a retail store. It would amaze me that people would spend 80% of their budget on the components and 20% on speakers. Ultimately it is the speakers that produce the sound you hear and should command the majority of your budget. Same thing is true about your financial education. No matter what happens, it is your knowledge that will allow you not only survive the changing economy, but to prosper!
I heard a story once that less than 1% of the world’s population controls 99% of the wealth. If you took all the money in the worlds and divided it up equally amongst the earth’s citizens than within a year that 1% would control 99% of the wealth again. Why? It is because the 1% have financial literacy. Isn’t it time we learn those financial skills!
Happy Trading!
For your forex education, visit me at FX Trainer!
Thursday, March 30, 2006
Forex Discipline
When it comes down to it, all successful traders have learned to mastery one important skill … discipline! As I progress as a trader, whether it is on my home court (the forex market) or on a road trip (trading options), discipline has been the skill that has made me more profits and lack of it has been the major contributor of all of my losses!
Living in the western portion of the United States requires local forex traders to either stay up late to trade the London session or wake up early to trade with the east coast. I am a morning person, so it is no brainer that I do the majority of my FX trading during the London-New York overlap period. A good nights sleep and a fresh morning coffee and I am ready to go hunting PIPS! Well I broke my rule last night and after tackling receipts going into tax season and looking at some option positions I had on, I took a look at my forex charts for a swing trade opportunity. I saw a nice opportunity for the euro to move up over the next several days. A long story short, I was yawning and could hear my bed calling. I shut down the computer and patted myself on the back for not placing any trades while I was so tired. I was disciplined in recognizing that I just do not trade well during the late evenings.
What happened today?
The euro was strong all day, and as of the writing of this post, had moved up 123 pips!!! Not the ending you were expecting!
My point is, discipline made me aware I was at my low point mentally and should not be placing forex trades in my current state of mind. I bring this up because this will happen to all traders a one point or another. 99 times out of 100 this would have been a losing trade!
Know yourself, establish your style and stay true to your plan. If you follow this simple formula success will just be a matter of time. Forex education is the key to developing a solid discipline trading approach.
Visit FX Trade Central for forex educational opportunities.
Living in the western portion of the United States requires local forex traders to either stay up late to trade the London session or wake up early to trade with the east coast. I am a morning person, so it is no brainer that I do the majority of my FX trading during the London-New York overlap period. A good nights sleep and a fresh morning coffee and I am ready to go hunting PIPS! Well I broke my rule last night and after tackling receipts going into tax season and looking at some option positions I had on, I took a look at my forex charts for a swing trade opportunity. I saw a nice opportunity for the euro to move up over the next several days. A long story short, I was yawning and could hear my bed calling. I shut down the computer and patted myself on the back for not placing any trades while I was so tired. I was disciplined in recognizing that I just do not trade well during the late evenings.
What happened today?
The euro was strong all day, and as of the writing of this post, had moved up 123 pips!!! Not the ending you were expecting!
My point is, discipline made me aware I was at my low point mentally and should not be placing forex trades in my current state of mind. I bring this up because this will happen to all traders a one point or another. 99 times out of 100 this would have been a losing trade!
Know yourself, establish your style and stay true to your plan. If you follow this simple formula success will just be a matter of time. Forex education is the key to developing a solid discipline trading approach.
Visit FX Trade Central for forex educational opportunities.
Tuesday, March 28, 2006
Forex Money Management
This may be my quick version of forex money management, but there is nothing more important. As I have been told over and over again, any one can get into a currency trade, but those who are profitable forex traders know when to exit a trade.
This is for profits as well as loses!
I find that the best forex trades I put on are those trades where my emotions are not a factor in the currency trade to begin with. To do this there are some basic principals I follow regardless of the strategy or time period I am trading.
This is for profits as well as loses!
I find that the best forex trades I put on are those trades where my emotions are not a factor in the currency trade to begin with. To do this there are some basic principals I follow regardless of the strategy or time period I am trading.
- I set a pip goal for the trade based on my trade plan and technicals. If you do not have a trade plan where you have outlined your currency trading goals and objectives then stop reading this blog and create one now!
- I never risk more than 5% of my account on any given trading opportunity. To calculate the amount I will risk I divide my trading account principal by 0.05 and then divide that by my stop loss (dictated by the strategy I employ) to give me the number of lots I will place on the forex trade. This is the number I am personally comfortable losing. Yes, I said losing! I always approach risk management in forex trading from a “what if I am wrong” point of view.
- I always trade with a stop loss and limit order! This takes the emotions right out of the equation. I have learned with experience to employ trailing stops and fine tuning of my technicals to lock in profit and provide ever increasing better entry and exit points. Over time I have been able to let more winners run and cut loses shorter than when I first began trading.
- Here is my forex money management “golden nugget!” If take pause after a draw down of 25% AND after a run up of 25%. During this 2-5 day period I trade in my demo account, practicing new strategies or reviewing the basics. This keeps me grounded when I am too down or too up.
These are my rules. By keeping a good forex trade journal you will be able to recognize your strengths and weaknesses, and employ them in your money management plan.
Join my community of traders at FX Trainer for your forex training needs and visit my forex education portal FX Trade Central for more currency information and education.
Sunday, March 26, 2006
FEAR and FOCUS
Is fear preventing your from achieving forex success? By now I know everyone has heard of the acronym for F.E.A.R. (False Evidence Appearing Real). Sometimes to get over the hump and put fear in our rear view mirror only requires an attitude check! Adjusting our attitude can build our confidence and basically get our heads out of the way and journey on to forex success!
Author’s Mark Victor Hansen and Jack Canfield (both from the famous Chicken Soup series of bestsellers) has another overlooked book on the market called The Power of Focus. In the nook they discuss strategies to combat fear and build confidence. Some of these strategies include;
- Remind yourself that you did some things well in your trading everyday.
- Read inspiring biographies and autobiographies. These can fall outside of the trading world.
- Be thankful. You are taking massive action to take control of your financial future!
- Build a support network around you. Use the mastermind principal to build a support team of traders and non-traders.
- Celebrate your success! If you can’t do this than repeat the first step (and do not collect $200!!!).
You can find this book and my entire mandatory reading list of my forex educational site, FX Trade Central.
Friday, March 24, 2006
The Perfect Storm
Forex is too risky! You are going to loose all of your money!
I hear gallery now. Don’t listen to the neigh Sayers, listen to your inner voice! I am often asked why I chose to trade the currencies. I have been a student of the economy and money for several years now. I am not an alarmist, but the tides of change are not far from us. I chose to trade forex as a tool to ensure my families financial well being during these times of change. Take charge! That is really all I am doing is taking charge.
The perfect economic storm is forming and I just want to have the shelter to ride out the storm. Will that storm ever arrive and with the ferocity the economist are predicting? You can never be sure, but I definitely have my opinions!
Let’s take a look at some facts. According to the Census Bureau less than 2% of Americans earn more than $100,000 per year. 87% of American will retire broke! By the age of 65 45% of Americans will be dependent upon family and friends 28% of Americans will be dependent upon government welfare 22% of Americans will still be working 4% of Americans will have enough savings to meet their needs 1% of American will be financially independent In other words, only 5% of the population will be able to retire at the age of 65 and still be independent. All this as our national debt continues to grow and more and more responsibility gets deferred to our future generations.
The “real” perfect storm occurred when 3 independent weather systems merged to form the perfect meteorological storm during the 1990s. The economic equivalent is beginning to take shape. The patterns are forming now. Pension plans are being phased out and employees are required to take on more and more the responsibility of their financial planning. Schools have not adapted their curriculum to include investor education.
For 10 straight years my medical contributions have risen. The largest generation in U.S. history will begin retiring in 2 years drawing a massive amount of liquidity from the financial markets and Generation X does not have the size to act as a counterbalance. And the final ingredient is the world economic balance is changing with the emergence of China as an economic powerhouse.
And to my Canadian friends, your export economy is tied to the U.S. by a factor of 85%!
I am investing now, not so much in a 401k or an IRA, but in my financial education, one that can profit in an ever changing global economy.
I have cash flow vehicles and wealth building vehicles. Forex is my dominant cash flow vehicle. I am also educating myself in the real estate market; internet marketing and I trade options as well. Like all storms this one will pass.
Looking forward to my “golden years” and being a later “Boomer” I want to increase my odds and have chosen education as the base for my defense! For more forex edcuational information please vist FX Trade Central and for your FREE forex education demo visit my other site at FX Trainer.
I hear gallery now. Don’t listen to the neigh Sayers, listen to your inner voice! I am often asked why I chose to trade the currencies. I have been a student of the economy and money for several years now. I am not an alarmist, but the tides of change are not far from us. I chose to trade forex as a tool to ensure my families financial well being during these times of change. Take charge! That is really all I am doing is taking charge.
The perfect economic storm is forming and I just want to have the shelter to ride out the storm. Will that storm ever arrive and with the ferocity the economist are predicting? You can never be sure, but I definitely have my opinions!
Let’s take a look at some facts. According to the Census Bureau less than 2% of Americans earn more than $100,000 per year. 87% of American will retire broke! By the age of 65 45% of Americans will be dependent upon family and friends 28% of Americans will be dependent upon government welfare 22% of Americans will still be working 4% of Americans will have enough savings to meet their needs 1% of American will be financially independent In other words, only 5% of the population will be able to retire at the age of 65 and still be independent. All this as our national debt continues to grow and more and more responsibility gets deferred to our future generations.
The “real” perfect storm occurred when 3 independent weather systems merged to form the perfect meteorological storm during the 1990s. The economic equivalent is beginning to take shape. The patterns are forming now. Pension plans are being phased out and employees are required to take on more and more the responsibility of their financial planning. Schools have not adapted their curriculum to include investor education.
For 10 straight years my medical contributions have risen. The largest generation in U.S. history will begin retiring in 2 years drawing a massive amount of liquidity from the financial markets and Generation X does not have the size to act as a counterbalance. And the final ingredient is the world economic balance is changing with the emergence of China as an economic powerhouse.
And to my Canadian friends, your export economy is tied to the U.S. by a factor of 85%!
I am investing now, not so much in a 401k or an IRA, but in my financial education, one that can profit in an ever changing global economy.
I have cash flow vehicles and wealth building vehicles. Forex is my dominant cash flow vehicle. I am also educating myself in the real estate market; internet marketing and I trade options as well. Like all storms this one will pass.
Looking forward to my “golden years” and being a later “Boomer” I want to increase my odds and have chosen education as the base for my defense! For more forex edcuational information please vist FX Trade Central and for your FREE forex education demo visit my other site at FX Trainer.
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