Identify Your Risk Tolerance

As individual traders we all have our own risk tolerance level that we must adhere to at all times. Before you begin to invest in forex and even stocks you are always advised to first identify your risk tolerance level, and the reason this question is important is solely for the purpose of choosing your investment vehicle. As we know all investments have different degree of risk to profit ratio and this is what we must have in mind when considering forex trading.

Forex trading is indeed a wonderful investment vehicle with great promises, but at the same time it holds a substantial degree of risk to your investment unlike stocks or other investments. In deciding you risk tolerance before jumping into the stock market you need to first identify exactly how much you can spare to invest, what your investment goals are and finally a realistic time to achieve this.

However, when deciding your risk tolerance you must weigh both sides of the equation to enable you see the true picture. What I mean by weighing both sides of the equation are simply working on the assumption you lose your investment to the market forces, what would then become of you? If you find you are unable to continue a fairly decent life where you are able to provide your basic needs then you might be taking way too much risk.

At the same time it is pointless to set for yourself a far fetching financial goal without preparing yourself to accept the risks involved. As we know the riskier the investment the greater returns which is why you must consider properly and not allow yourself blinded by mere greed.

Also age is a determining factor on how much risk you can take. Though some might disagree with this but look at it from this perspective...a 20 year old guy taking risk with his savings has reasonable more time to recuperate if he looses all than does a man of 60. So you must factor your retirement age into the equation as well in deciding your risk tolerance. Do not just choose any arbitrary number as your risk tolerance level, rather take time to work it out with respect to your present condition and where you want to be in "x" time.

FOREX AUTOPILOT REVIEW

If you are anything like me you will definitely go through Google using different search phrases before you actually put your hard earned money towards making a purchase. You have come here to see what i have to say about the Forex Autopilot by Marcus B. Leary right?

I first heard about the Forex Autopilot system through my colleague at work, who was constantly on the look out for a possible investment that could help him retire early. When he told me about the Forex Autopilot i simply told him to tell me again about it when he has used it on a life account for a period not less that two months with proof of profits generated. We had this little chat at the end of November, and on the 24th of February he called me and asked that i drop over at his place for a drink. I obliged and when i got there he had his system up and running and waiting for me, he went ahead to log into his trading account and looking through his records i saw that he had turned $2100 into $5250 in less that three months. This might not seem like much but knowing how difficult it is to make a continuous profit from the market i was impressed and decided to invest in the Forex Autopilot (seeing that there was a 100% money back guarantee which clickbank will definitely see that the vendor lives up to)

To cut a long story short i bought the software three days after the visit to my friend, tried it on a demo account for two weeks and when i saw that i was getting good trades i decided to move over to a life account because i kept a tab on my friend and he was still growing his portfolio. But however there were a few things that i noticed with using the software which i feel you should know:

The software comes with a manual which is not to be taken lightly, please ensure you read and understand this manual (it is quite easy and pretty straight forward but you must read it however). It took me a whole 3 days to fully go through the manual at my own pace and i must say i was glad i did.

As you use the Forex Autopilot also educate yourself more on forex trading as it will help you make better use of the software because then you will have a fuller understanding of the bigger picture. Click here to get the Forex Autopilot

P.S. Just a quick point to remember is that the system default setting is very ideal if you are a complete newbie to trading the forex market. But on the other hand if you are an experienced trader the system allows you to tweak a few parameters like, trailing stop, stop loss and take profit limits for maximum returns as you wish. But as said before using it on default is perfectly alright and profitable from my own experience. Happy Trading

Forex Trading-Create Your Own System

The first thing a Forex Trader whether advanced or newbie need to identify is their own trading system. There are so many websites peddling different types of Forex Trading signal generators, although i do not wish to criticize any particular system i however want to draw attention to the fact that as a Forex Trader you need to identify with a particular trading system and then only use software for enhanced results if any. Remember that a lot of people make more money selling Forex Trading systems that they make from trading forex itself.

Before you decide to rush out there to buy a Forex Trading software you need to understand that you will get no where with the best software whilst you remain an indisciplined trader. Every successful Forex Trader will tell you that to succeed in the world of Forex Trading you must have the discipline to follow a system, because a successful system could fail as a result of your own indiscipline.

Developing a Forex Trading system is not as hard as you might think, in fact it is easier than you think. As a Forex Trader there are certain criterion that your system must cover before it could ever stand a chance to succeed, and some of such are:

Forex System Step One: You must identify what kind of trader you are (day, swing, position) as this will help you to determine what time frame you will be trading and in turn what charts to look at.

Forex System Step Two: Don't fill your chart with indicators just because you read about them in some fancy stock trading book. Use indicators that that will help you identify trends better such as moving averages.

Forex System Step Three: Use trend confirming indicators before you enter your trades. Good trend confirming indicators are Moving Average Convergence and Divergence (MACD), Stochastics and Relative Strength Index (RSI).

Forex System Step Four: Always use stop loss as this will help you determine a fixed loss that you will allow before exiting the market. Do not allow yourself to get into a stampede when the market begins to move against you. However in determining your stop loss you must be careful not to stop yourself out. It is also wise to determine a take profit point before you enter the market so that greed will not get a better part of you. Good a thing many Forex Trading platforms have contingent orders such as trailing stops which you can use to protect your profit.

Forex System Step Five: Without much ado stick to your system and don't run after every single new system that enters the market. Its important for a Forex Trader to also review his system from time to time and tweak it till you get comfortable with your returns.

Daily Forex Commentary

The March Dollar closed sharply lower for the second day in a row on
Wednesday confirming Tuesday's decline below the
lower boundary of this winter's trading range at 74.80. The low-range
close sets the stage for a steady to lower opening on
Thursday. Stochastics and the RSI are oversold but remain bearish
signaling that sideways to lower prices are possible near-
term. This week's breakout below November's low crossing at 74.80 has
opened the door into uncharted territory marking
downside targets hard to project. Closes above the 10-day moving
average crossing at 75.70 would confirm that a short-term
low has been posted. First resistance is broken support crossing at
74.80 then the 10-day moving average crossing at 75.70.
First support is today's low crossing at 74.125.

The March Euro gapped up and closed above this winter's trading range
high crossing at 149.30 on Wednesday. The high-range
close sets the stage for a steady to higher opening on Thursday.
Stochastics and the RSI are overbought but remains bullish
signaling that sideways to higher prices are possible near-term.
Today's closes above the trading range high crossing at 149.300
has renewed the long-term uptrend and is once again trading into
uncharted territory. Closes below the 10-day moving average
crossing at 147.772 are needed to confirm that a short-term top has
been posted. First resistance is today's high crossing at
151.360. First support is today's gap crossing at 149.750 then the
10-day moving average crossing at 147.772.

The March British Pound gapped up and extended Tuesday's breakout above
the November-December downtrend line on
Wednesday. The high-range close sets the stage for a steady to higher
opening on Thursday. Stochastics and the RSI are
overbought but remain bullish signaling that sideways to higher prices
are possible near-term. Closes above January's high
crossing at 1.9892 are needed to confirm an upside breakout of this
year's trading range. Closes below the 20-day moving
average crossing at 1.9615 would confirm that a short-term top has been
posted. First resistance is today's high crossing at
1.9915. Second resistance is the 38% retracement level of the
November-February decline crossing near 1.9969. First support is
today's gap crossing at 1.9713 then the 10-day moving average crossing
at 1.9629.

The March Swiss Franc gapped up and closed above the previous reaction
high crossing at .9325 on Wednesday thereby
extending this winter's rally. The high-range close sets the stage for
a steady to higher opening on Thursday. Stochastics and the
RSI are overbought but remain bullish signaling that sideway to higher
prices are possible near-term. If March extends today's
rally, upside targets will be hard to project now that March is trading
into uncharted territory. Closes below the 20-day moving
average crossing at .9161 would confirm that a short-term top has been
posted. First resistance is today's high crossing at
.9412. First support is broken resistance crossing at .9325 then the
10-day moving average crossing at .9184.

The March Canadian Dollar closed higher on Wednesday as it extends this
week's rally. The high-range close sets the stage for
a steady to higher opening on Thursday. Stochastics and the RSI remain
bullish signaling that sideways to higher prices are
possible near-term. If March extends this week's rally, December's high
crossing at 102.55 is the next upside target. The head
and shoulder's bottom projects a potential rally to the 106.80 area,
which coincides with the 75% retracement level of the
November-January decline crossing at 106.62. Closes below Tuesday's gap
crossing at 100.37 would signal that a short-term
top has likely been posted. First resistance is today's high crossing
at 102.28. Second resistance is December's high crossing at
102.55. First support is Tuesday's low crossing at 100.98 then
Tuesday's gap crossing at 100.37.

The March Japanese Yen gapped up and closed and closed above the 20-day
moving average crossing at .9347 on Wednesday
confirming that a short-term low has been posted. The mid-range close
sets the stage for a steady opening on Thursday. Closes
below Monday's low crossing at .9252 would confirm that a short-term
top has been posted. Stochastics and the RSI remain
bullish signaling that sideways to higher prices are possible
near-term. If March extends this week's rally, the reaction high
crossing at .9467 is the next upside target. First resistance is
today's high crossing at .9452. Second resistance is the reaction
high crossing at .9467. First support is today's gap crossing at .9340.
Second support is Monday's low crossing at .9252.

Forex Kiss Strategy

Below is the review of the Fores Kiss strategy given by a Trader who bought the software and was kind enough to share his experience.

I would like to update the Forex community with my experience with the system and my final evaluation.

While the system ultimately performs exactly as advertised and comes with outstanding support, the bottom line is that I got a margin call on 2 different pairs that I was trading - exactly by the book.

The system essentially takes larger and larger trades (in Martingale fashion), at predefined levels (ie. 40, 50, 70 pips) opening trades in squares 2, 4, 8, 16, etc. up to a total of 10 levels - or 512, in hopes that the market will eventually retrace and get you out at a profit. While the market usually does retrace by the level amount at some point during its rise or fall, it does not necessarily always retrace to your take profit level, so depending upon where your trades started, it could (and did in my case) weave a nice up and down pattern right in between my take profit levels (missing it by 2 pips in one case) and continuing on until you get to 10. And then when you throw on top of this the massive moves that we have seen in the JPY, CHF, and EUR, you have a really volatile mix that brings trouble fast.

There is also a problem that you will face once you get to 10, as no more trades will be opened and you will be stranded at sea if the price continues to trade out of your grid...all the while going more and more into a spiraling and growing draw down. Of course, some will say that you can at that point enter an opposing trade in the exact amount of lots that you had opened, thus hedging and freezing your position. But then what? You just sit there and wait until it comes back into your grid? This could take weeks, months, or years. And even if it did come back to your grid, then what, you release the hedge when it gets back to the grid? It sounds like it would work, but its not all that easy. And you will lose a big chunk of change on the spread of your hedge trade too, because it will be a big one.

And by the way, this last trade - at 512 - is a whopper, causing massive movement in your equity with every tick. While I did make some good and steady profits for many months, in the end, the program wiped out my account, which, thankfully for me, was a small tester account. As I see it, its just a matter of time before one of the pairs you are trading runs all 10 levels against you and blows out all of your gains and takes your equity with it. And the worst part of it all is that you will feel completely powerless to do anything while this is happening - other than closing out all of your positions and running for the hills - which kind of nullifies the whole point of trading a system in the first place (if you are not going to follow your system), because again, it trades exactly as advertised. Just know what you are getting into before you trade this EA.

HAVING SAID ALL OF THIS, I do still really believe that this EA can make you a ton of money IF you leverage it to the max and treat it as an all or nothing proposition. IN other words, have a set amount in your account that you are prepared to completely blow out, leverage it to the max, let the EA rip and take profits out every week. Based upon my demos, I was doubling my account every 1-2 weeks, but then I blew it out every so often. But the doublers outnumbered the blow outs. If you can handle this, you can make alot of money with the Kiss-EA. It's really no different than buying an option for instance, knowing exactly what your exposure is and either you make money or you lose your option cost. And then you repeat as often as you like. For me, I dont know if I am ready to handle this yet.

AND in the final analysis, I will still refrain from rating the system, since I think it sucks if you are trading tiny lots, but is really amazing on a larger scale with lots of leverage and high risk.

Read More on Forex Kiss Strategy

Forex Killer

If you do a Google search on "Forex Killer" you will find a lot of reviews and opinions on this particular Forex Trading Software. Personally i do not encourage or advocate that a trader relies 100% on the use of the signal generating software, but rather use it to help make a more accurate and informed decision.

As a Forex Trader i decided to try the Forex Killer myself before actually giving a recommendation or a condemnation. And from my findings i will say that in all fairness to the guy who designed that it is a very brilliant software but i have a few other things to say;

If you are a newbie to Forex Trading and think that just because it says on the sales page that "No trading experience requires" there fore you are just going to purchase the software and your bank manager will put your mobile number on speed dial, I'll advice you to think again. Make no mistake about this software can help you fire up your profit by a very reasonable margin and remove some extra work from you. However it is advisable to have a basic knowledge of Forex Trading before involving yourself in the use of software. Software will not deal with your bad habits (every trader has got one), its constant practice & education that will help rid you of those bad habits.

I have tried a lot of the Forex Trading softwares out there but none comes close to doing what the Forex Killer does at the moment. Forex Killer though efficient allows me to keep that bit of control in every trade (It recommends but never executes automatically).

There’s no more guessing whether you should take a trade because your trading system is completely and totally generated by the Forex Killer software. It’s unemotional, it’s unbiased, and it can be highly profitable for you.

Whether you are a day-trader or position trader, the Forex Killer System works great in finding you profitable trades to take. With the probability calculator, you can decide to take only trades that have a 70% or higher chance of being profitable!

Conclusively, i will say that the Forex Killer does exactly what it's said to do. But better still the 56 days 100% money back guarantee gives you enough time to actually put the software to test and if for any reason you are not satisfied you can get your money back without questions asked. I wish you a healthy Forex Trading Life

forex-killer.com

A Forex Trader's Ideal Day.

No Forex trading is complete without a routine to make good trading habits in preparation for the trades. No good trading results come from lack of preparation. Once a routine is carried out consistently, trading success will come consistently. A basic checklist below will get a Beginner trader started. Modifications can be made accordingly to fit the trader's preferences (use of fundamental or technical analysis), trading style (day, swing, position) and markets (single or multiple markets).

Before market opens
1. Check the day's economic calendar for any scheduled reports and announcements for the day-- This part covers the fundamental analysis. He will be checking the expected numbers against reports that will be publish during the day, recalculating the numbers to find value. (This is typically for the trader whose major strategy is based on fundamentals).
2. Draw up analysis for changes in the fundamental news & reports (interest rate changes, jobless numbers, specific company earnings etc.) to reflect to current market conditions.
3. Check the chart for overnight price action - this is mainly for a trader who trades using technical analysis. Normally he will check to see if the prices have violated any support/resistance area or any numbers that he considers important enough to confirm or reject the current direction or market conditions.

In forex trading, the most popular indicators and tools used are:
a. Fibonacci numbers
b. Floor pivots (daily, weekly, monthly)
c. Support/Resistance areas (daily, week, month)
d. High/Low/Open/Close
e. MACD, RSI, Momentum, Volume, or other indicators.

4. Write a trading plan - This step requires the Forex trader to write out his plan for the day, how many trades, how much to risk or how much profit to take, where he'll be taking the position and where he'll exit, and how large the position size he's going to take.

During market hours
1. During market hours, the trader has a few options at hand:
a. Set alarms to notify crucial levels to trade to change positions that need to be made. (This is for swing and daytraders)
b. Watch news channels (optional) such as CNBC or Bloomberg to make sure there are no sudden economic or political news around the world that may impact market movements such resignation of a president, or terrorist attack on oil field, etc. (This is for daytraders).
c. Monitor the charts and indicators continuously, trendlines, pivots, and redrawing Fibonacci levels. (This is for daytraders).
d. Take positions as dictated in the trading plan. If the setup had appeared during the trading session that was written in the trading plan, execute it accordingly.

After market hours
Trader's Daily Routine Checklist Who Have Signal-Service or Newsletter Subscriptions
1. Check/read newsletters from paid/unpaid subscriptions from signal service, news, analysis, etc. and compare them to trading plan. Analyze them accordingly to be sure these fit into the trading plan.
2. Strategy portfolio management and maintenance-recalculating and verify if the balances are correct and if any instrument has gone outside the percentage of the portfolio. If for example an instrument that was made 30% in gains, these gains must be settled: either by reducing the holdings or hedge with another instrument to ensure the gains made or reduce exposure of the originally instrument.
3. Write/Revise the trading plan for the next day, which pairs to buy/sell, how many or how much, and tactically at what price to buy/sell and exit.

But remember to keep your forex trading simple and avoid information overload.