Choosing Your Forex Trading Platform Carefully | ForexGen

Selecting a forex trading system that is easy for any user to use provides more than convenience. In the serious business of trading foreign currency, time really is money literally.Let us begin to explore and discover some other compelling benefits of a forex trading platform that contributes in a major way to a traders overall success and profit margin.#1 Accuracy of the Forex trading system:Foreign currency trading is done in real time while every second exchange rates quickly change. When a trader executes a forex trade and locks in the exchange rate that transaction should be recorded immediately.Since a quote can only be precise at the moment it has displayed any delays in processing the trade will cost traders in lost profits. Your Forex trading platform software should access servers with the most accurate exchange rates available.A web browser based trading platform makes it easy to trade Forex from any location in the world with Internet access since there is no software to download. This ensures that your stop loss and take profit targets are executed exactly as you placed them (the suggested method for forex trading).

#2 Security of the forex trading platform: Of course, it goes without saying that any forex trading platform you decide on should be highly secure to protect your account and private information. It should allow you to fund your trading account securely with a variety of options including credit card, western union and paypal if needed.#3 Integrity of the forex trading platform:A forex broker providing transparent services is a worthwhile choice for any forex trader. All costs associated with the trading platform and trading account in general should be disclosed up front.Integrity means not having to pay any hidden commission charges or fees for making deposits and withdrawals. Bank costs that are part of doing business as a forex dealer are not passed on to you the forex trader.Beware of any service provider that does not provide sufficient firewall protection and some sort advanced SSL for user authentication and data transfer.Forex Trading System can seem overwhelming If you are new to forex, and you are going to need forex charts to assist you along they way.

While you develop your forex trading system, you will want to use the demo accounts that many trade brokers provide. They will generally provide free forex charts as part of their demo forex trading system.You can search the Internet for forex or "forex charts" for more details. The choices will be a bit overwhelming at first but you will be fine once you have done a little homework. You will have to do research to find a good match that fits your needs, both with the forex trading system and forex charts themselves. You may have to compare a few of them and match them up to get your specialized needs met.

Dow Theory, Part II | ForexGen

In today’s lesson we are going to take a look at the second 3 tenets which will finish up our discussion of Dow Theory and give us a strong basis which we can then use to analyze trends and eventually place some trades.Tenet four of Dow Theory is that The Averages Must Confirm Each Other.

The averages must confirm each other. Here Dow was referring to the Dow Jones Transportation Index and the Dow Jones Industrial Average. To understand this point it is important to remember that in Dow’s time the growth in the US was coming mainly from the Industrial sector. These two indexes were made up of manufacturing companies and the rail companies which were the primary method used to ship the manufacturers goods to market. What Dow was basically saying here is that you could not have a true rally in one of the averages without a confirmation from the other because if manufacturer’s profits were rising they would have to ship more goods.

This meant that the profits of the transportation companies and therefore the transportation average should rise too. Dow stated that when these two averages moved in opposite directions it was a sign that the market was going to change direction.
Tenet five is Trends Are Confirmed by Volume.

Dow Theory tenets | ForexGen

The first tenet of Dow Theory is that the Markets Have 3 Trends.

• Up Trends which are defined as a time when successive rallies in a security price close at levels higher than those achieved in previous rallies and when lows occur at levels higher than previous lows.

• Down Trends which are defined as when the market makes successive lower lows and lower highs.

• Corrections which are defined as a move after the market makes a move sharply in one direction where the market recedes in the opposite direction before continuing in its original direction.

The second tenet of Dow Theory is that Trends Have 3 Phases:

• The accumulation phase which is when the “expert” traders are actively taking positions which are against the majority of people in the market. Price does not change much during this phase as the “experts” are in the minority so they are not a large enough group to move the market.

• The public participation phase which is when the public at large catches on to what the “experts” know and begin to trade in the same direction. Rapid price change can occur during this phase as everyone piles onto one side of a trade.

• The Excess Phase where rampant speculation occurs and the “smart money” starts to exit their positions.

The third tenet of Dow Theory is that The Markets Discount All News, meaning that once news is released it is quickly reflected in the price of an asset

An Introduction to Dow Theory | ForexGen

In this lesson we will look at the history of technical analysis and something known as Dow Theory. Most consider the father of technical analysis to be Charles Dow, the founder of Dow Jones and Company which publishes the Wall Street Journal. Around 1900 he wrote a series of papers which looked at the way prices of the Dow Jones Industrial Average and the Dow Jones Transportation Index moved.

After analyzing the Indexes he outlined his belief that markets tend to move in similar ways over time. These papers, which were expanded on by other traders in the years that followed, became known as “Dow Theory”. Although Dow Theory was written over 100 years ago most of its points are still relevant today. Dow focused on stock indexes in his writings but the basic principles are relevant to any market. Dow Theory is broken down into 6 basic tenets. In this lesson we are going to take a look at the first 3 and then finish up our conversation of Dow Theory in the next lesson by looking at the last three.

Introduction To Technical Analysis With ForexGen

There are two basic methods that traders use in determining when to enter the market when trading the stock, Forex, and futures markets, which are: Fundamental analysis which seeks to determine the value of a financial instrument by analyzing all the things such as the balance sheet of a company when trading stocks, or interest rate expectations when trading currencies to try and estimate whether a particular financial instrument is over or under valued.

Technical analysis on the other hand focuses purely on historical price action of a particular instrument to determine whether the instrument is more likely to increase or decrease in value in the future, and therefore how it should be traded. Although there are exceptions to this, as a general rule, longer term investors tend to base their trading decisions on fundamentals and shorter term traders tend to focus more on technicals.

From my experience, although active traders tend to focus more on technicals than fundamentals, they still have an understanding of fundamentals and many consider fundamental factors in their trading decisions along with their technically based analysis.