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Forex Trading Tips

Hey everyone. I’ve complied a list of good tips that novice FOREX traders should all read. I hope it helps to make you a better trader. Take care.

Tip 1.

Gamblers go to casino. All unproved, spontaneous actions in Forex trading are a part of pure gambling. Any attempt to trade without analysis and studying the market is equal to a game. Game is fun except when you are losing real money…

Tip 2.

Never invest money into a real Forex account until you practice on a Forex Demo account! Allow at least 2 month for demo trading. Consider this: 90% of beginners fail to succeed in the real money market only because of lack of knowledge, practice and discipline. Those remaining 10% of successful traders had been sharpening and shaping their skills on demo accounts for years before entering the real market. A good demo account to start practicing with could be, for example, FXGame from Oanda.

Tip 3.

Go with the trend! Trend is your friend. Trade with the trend to maximize your chances to succeed. Trading against the trend won’t “kill” a trader, but will definitely require more attention, nerves and sharp skills to reach trading goals.

Tip 4.

Always take a look at the time frame bigger than the one you’ve chosen to trade in. It gives the bigger picture of market price movements and so helps to clearly define the trend. For example, when trading in 15 minute time frame, take a look at 1 hour chart; trading hourly would require obtaining a picture of daily, weekly price movements. If a trend is hard to spot . choose a bigger time frame. Up and down market patterns are always present. Always make sure you know the dominant trend, unless you are a scalper. Scalpers have no need to spend their time studying big trends, what’s happening in the market here and now (during 5-10 minute time frame) should be of only importance to a Forex scalper.

Tip 5.

Never risk more than 2-3% of the total trading account. One important difference between a successful and an unsuccessful trader is that the first is able to survive under unfavorable conditions on the market, while an unsuccessful trader will blow up his account after 5-10 unprofitable trades in the row. Even with the same trading system 2 traders can get opposite results in the long run. The difference will be again in money management approach. To introduce you to money management, let’s get one fact: losing 50% of total account requires making 100% return from the rest of money just to restore the original balance.

Tip 6.

Put emotions down. Trade calm. Don’t try to revenge after losing the trade. Don’t be greedy by adding lots of positions when winning. Overreaction blocks clear thinking and as a result will cost you money. Overtrading can shake your money management and dramatically increase trading risks.

Tip 7.

Choose the time frame that is right for you. Choosing wise means that you are comfortable and have time enough to analyze the market, place and close orders etc. Some people can’t wait for hours for the price to make a move, they like action and therefore prefer smaller time frames. On the contrary, for others 10-15 minutes is a hustle to be able to make the right decision.


Tip 8. Not trading or standing aside is a position.

When in doubt, stay out. If it is not clear where the market will move, don’t trade. In this case saving present capital is and absolutely better choice than risking and losing money.

Tip 9. Learn to use protective stops. Respect them and don’t move.

Hoping that market will turn in your direction is a very delusive hope. By moving a stop loss further a trader increases his chances to end up with much bigger loss.

When holding to a losing trade too long, and even if funds permit, traders as a rule are very reluctant to accept big losses, thus often continue “hoping for best”. In the mean time invested money is stuck in the open trade for unknown period of time (weeks and even months) and cannot be used for opening new positions. Not working money, dead money. Also this will result in constant interest payments for holding open positions.

Tip 10. “Keep it simple, stupid” applies to indicators, signals and trading strategies.

Too much information will create a controversial picture of where to trade and when not to. To avoid lots of confusion create a simple but working method of trading Forex.

Tip 11. Think about risk/reward ratio before entering each trade.

How much money can you lose in this trade? How much can you gain? Now, make a decision if the trade is worth entering.
Example: if trader is looking for possible 35 pips gain and possible 25 pips of loss, such conditions are not worth trading. Compare it with the situation when a trader has 100-120 pips of potential gain and only 10-20 pips of possible loss. This is the trade to open!

Tip 12. Never add positions to a losing trade. Do add positions when the trade has proven to be profitable.

Don’t allow a couple of losing trades in a row become a snowball of losing trades. When it is obviously not a good day, turn the monitor off. Often not trading for one day can help to break a chain of consecutive losses. Trying to get revenge can often make things worse.

Tip 13. Let your profits run.

Let your position be open for as long as the market wishes to reward you. Of course, for this traders need a good exit strategy, otherwise they risk to give all profits back…
Running two or more open trades gives an option to close some positions earlier and keep others running for higher profits.

Tip 14. Cut your losses short.

It’s better to finish unprofitable trade quickly than wait for the situation to get worse. Don’t put a stop loss too far, it’s your money you risk. Better calculate the best spot to enter when a potential loss would be minimized. Again: respect your stop and don’t move it “cherishing hopes”.

Tip 15. Trade currency pairs in respect to their active market hours.

Learn about overlapping market hours: when two markets are open and highest volume of trades is conducted.
For example, Australian and Japanese trading sessions are overlapped from 8pm to 1 am EST. At that time trader can successfully trade AUD/JPY currency pair.


16. Choose the right day to trade.

This recomendation is often wrongly taken as an optional thing, because everyone knows that Forex market is open 24 hours a day 7 days a week. Yet, choosing the time to trade can make a difference between successful and hopeless trading.

It’s proved and highly recommended not to trade on Mondays, when the market has recently awaken and is making first “probation steps” to form a new or confirm a current trend; and on Fridays afternoon, during the huge volume of closing trades. The best days to trade are Tuesdays, Wednesdays and Thursdays.

17. Learn about Fibonacci levels and how to use them for trading.

Fibonacci can be very helpful in trading, even partially using the study, for example, to determine the best exit, can bring traders to a new edge of trading.

18. Always ensure that a signaling bar/candle on the chart is fully formed and closed before you enter a trade.

A golden rule of trading: “Always trade what you see, not what you would like to see” is the best explanation here.

19. If you ask for someone else’s advice as about how and when to trade

In other words, choose to rely on live trading signals from other traders, make sure you do it for your benefit, not for disaster. If you use such signals to discover how other traders do analysis and study on the price, you are on the right track and soon you’ll be able to do analysis yourself.
But if you’re just blindly following recommendations and your only task is to push the correct button… think again.

20. Using a highly leveraged account comes at a cost.

It will, of course, give a trader more financial gear to trade, and also trader’s broker will be happy as it will mean higher spread income for him. On the other side a trader signs up for additional risks that multiply with higher leverage in a “friendly tight” proportion.

21. Learn to measure trading success by the end of the day, week and then month and year.

Do not judge about your trading success on a single trade. To be successful traders don’t need to win every trade, they also don’t become rich in one trade, they need to be profitable in a long run.

22. There is no such thing as a secret approach to understanding the market.

Take the time to develop a solid trading system and find out that the secret to trading success lies in hard work and constant learning.


Funny money quotes

enjoy these money quotes…

“I wish everyone could get rich and famous and everything they ever dreamed of so they can see that’s not the answer.”
~ Jim Carrey

“He that is of the opinion money will do everything may well be suspected of doing everything for money.” ~ Benjamin Franklin “If you would be wealthy, think of saving as well as getting.”
~ Benjamin Franklin

“Who is rich? He that is content. Who is that? Nobody.”
~ Benjamin Franklin

“Annual income twenty pounds, annual expenditure nineteen six, result happiness. Annual income twenty pounds, annual expenditure twenty pound ought and six, result misery.”
~ Charles Dickens

“If all the rich people in the world divided up their money among themselves there wouldn’t be enough to go around.”
~ Christina Stead

“Money was never a big motivation for me, except as a way to keep score. The real excitement is playing the game.”
~ Donald Trump

“If you want to know what God thinks of money, just look at the people he gave it to.”
~ Dorothy Parker

“I’m living so far beyond my income that we may almost be said to be living apart.”
~ e e cummings

“The only way not to think about money is to have a great deal of it.”
~ Edith Wharton

“Save a little money each month and at the end of the year you’ll be surprised at how little you have.”
~ Ernest Haskins

“My problem lies in reconciling my gross habits with my net income.”
~ Errol Flynn

“The mint makes it first, it is up to you to make it last.”
~ Evan Esar

“Lack of money is the root of all evil.”
~ George Bernard Shaw

“Money frees you from doing things you dislike. Since I dislike doing nearly everything, money is handy.”
~ Groucho Marx

“If you can count your money, you don’t have a billion dollars.”
~ J. Paul Getty

“I have enough money to last me the rest of my life, unless I buy something.”
~ Jackie Mason

“A large income is the best recipe for happiness I ever heard of.”
~ Jane Austen

“A wise man should have money in his head, but not in his heart.”
~ Jonathan Swift

“Do not be fooled into believing that because a man is rich he is necessarily smart. There is ample proof to the contrary.”
~ Julius Rosenwald

Monopoly Men (Federal Reserve Fraud) (1999)

Ok, here is the third part in my series of educational financial videos. Below follows a description of the subject matter. Enjoy! The Federal Reserve, or the Fed as it is lovingly called, may be one of the most mysterious entities in modern American government. Created during Wilson’s presidency to protect the economy in times of financial turmoil, its real business remains to be discovered. During the Wilson presidency, the U.S. government sanctions the creation of the Federal Reserve. Thought by many to be a government organization maintained to provide financial accountability in the event of a domestic depression, the actual business of the Fed is shrouded in secrecy.

Many Americans will be shocked to discover that the principle business of the Fed is to print money from nothing, lend it to the U.S. government and charge interest on these loans. Who keeps the interest? Good question. Find out as the connective tissue between this and other top-secret international organizations is explored and exposed

Money, Banking and the Federal Reserve

Here is the second video as part of my “educational financial videos” series. This one comes from one of my favorites organizations, The Ludwig von Mises Institute. Below you’ll find a concise description of the subject matter portrayed by this video: Thomas Jefferson and Andrew Jackson understood “The Monster”. But to most Americans today, Federal Reserve is just a name on the dollar bill. They have no idea of what the central bank does to the economy, or to their own economic lives; of how and why it was founded and operates; or of the sound money and banking that could end the statism, inflation, and business cycles that the Fed generates.

Dedicated to Murray N. Rothbard, steeped in American history and Austrian economics, and featuring Ron Paul, Joseph Salerno, Hans Hoppe, and Lew Rockwell, this extraordinary new film is the clearest, most compelling explanation ever offered of the Fed, and why curbing it must be our first priority.

Alan Greenspan is not, we’re told, happy about this 42-minute blockbuster. Watch it, and you’ll understand why. This is economics and history as they are meant to be: fascinating, informative, and motivating. This movie could change America.

Monthly Results Update Infinity Shares

Here is the update from Infinity Shares. IS is a private invite-only forex investment club. I know there are a few of your reading my blog that are members so I’m posting this update for you in case you did not check your e-mail or you’re not a member of the club and you’re curious to know how the program is doing.

If you want to join the Infinity Shares Forex Investment Club you’ll have to get an invitation by me or any other member. E-mail me at allinvain6 at and I’ll hook you up.

—begin quote—

Good Day Members,

It’s been a pretty busy month in IS. We had some problems with E-gold, but they seem to have been resolved now as some of the more trusted exchangers are resuming outexchanges again, so that means that we can accept e-gold now again.

The whole month was sort of a “dry-run” for IS as we tried out new trading methodologies and a new broker to boot. Technical trading has been pretty good to us during the month, netting us small profits here and there. We did experience some drawdowns, but not too much to cause a worry. We started technical trading with a few mini-lots at a time to get used to the method while gradually increasing our trades to full-lot trades. A lot of the earlier profits were from mini-lots, so not much there, and with the end of the month approaching fast, we ended up with a mini-lot value profit.

Profit for this month: 1.19%

My current FXDD Auto Portfolio

Here is my current (June 29, 2007) FXDD Auto portfolio:

PipboxerV2 GBP/JPY
ProtradeFX GBP/JPY
SwingForexSignals AUD/NZD

FXDD Auto: Update on my trades

Well, bad news, I just lost -120 pips 🙁 . The trade was opened by EspritFX EUR/JPY. I have decided to remove them from my portfolio. I am getting tired of their negative performance. What makes it worse is that they opened the trade in a clear uptrend. My guess is that this is a mechanical trading system. It was trying to initiate a sell to possibly profit from the potential downswing (the EUR/JPY is at an all time high), but clearly it was a stupid trade which resulted in a loss of 120 pips!! Not cool for my account.

I have replaced EspritFX EUR/JPY with ATRChannel GBP/USD

That’s all for now. I’ll keep you guys posted.

Private 1 Investment Program (forex based) just received payment

I just recently received an e-gold payment from a very private online investment club that I call “Private 1”. Here is a copy+paste of my withdrawal request. As you can see, it’s not as if I withdrew a million dollars, but it’s a very good return for about a month considering that I only put in $250 (I plan to invest more and reinvest all earnings).

Here is the proof:

Withdrawal Summary


Withdrawals to date:


(to ecurrency account/wire transfer)

Oh, and I did a review of this private elite forex investment program and you can read it over HERE

As you may have noticed if you read my review, I’m charging $25 per referral code. This seems to me like a reasonable price considering that I only have 9 referral codes and therefore each code is precious. Contact me if you want in. I want only serious investors! None of that HYIP hit and run junk! Long term investors only (program has been running for roughly 3 years)!

So if you want in e-mail me at allinvain6 at Hope to see you become a member and chatting with me in the program’s forum 🙂