Risks Involved in Forex Trading

Risks Involved in Forex Trading

The Forex market presents a great investment opportunity for traders to profit. A $5 trillion daily worth of transactions shows what a profitable venture it is. Understanding the market and having an effective trading plan is essential for success in the market. However, there are risks involved in Forex trading that you should know about. They are as follows: Liquidity Risk Liquidity risk is the risk that arises when there…


Trading Styles (Scalper, Day Trading, Swing Trading & Position Trading)


All human beings are different, and so are Forex traders. A look through the MetaTrader 4 platform will show you different time frames used by traders. These are the 1 minute, 5 minutes, 15 minutes, 30 minutes, 1 hour, 4 hours, daily, weekly, and monthly time frames. Different traders use the various time frames listed above according to their preferences and as a result these influence their trading styles. In…


Understanding Japanese Candlesticks (Bullish and Bearish)

Japanese Candlesticks

There are different ways to analyse price movement in the Forex market. Technical analysis is one way to do it. It involves studying the historical price movement to determine the probable future price movement.Line charts, bar charts, and candlestick charts are applied in technical analysis. They help in showing price fluctuations across different time frames. One very popular chart is the candlestick chart. What is a Japanese Candlestick Chart? Japanese…


A Guide to Forex Currency Pairs

Guide to Forex Currency Pairs

In case you didn’t know, Forex is the most traded product in online trading today; In this article we are going to briefly discuss the main Forex pair categories. We will explain what are the Major, Minor, Crosses and Exotic currency pairs. After reading this article you will be able to understand the difference between all categories and how to approach them when an opportunity arises. Forex Majors Forex majors…


Predicting Early Market Movement – Leading vs. Lagging Indicators

Predicting Early Market Movement

In financial trading almost every trader uses some kind of technical indicator for market prediction or to validate his/her trade decisions. There are hundreds of indicators for predicting early market movement available in different platforms and over the internet based on different strategies and mathematical calculations. Now the problem is most of them are lagging indicators, meaning they generate a Buy or Sell signal when the market is already moving…


Long and Short Positions

Long Position

Understanding the Long and Short Positions in Forex For novice traders, terms used in the Forex market may be confusing. Hence the significance of understanding Forex terminologies and what they represent. Today we’ll be dealing with long and short positions. As you know, trading currencies involve buying one currency while simultaneously selling another. Therefore, traders take either long or short positions in the market. These positions are discussed below; What…


How to Develop a Trading Plan

Trading Plan

A trading plan is a set of rules and guidelines that shape and define your trading decisions & behavior, including but not limited to: financial goals, money management rules, risk management techniques and criteria for opening and closing positions. Due to lack of education a large number of traders have never used a trading plan and that’s one of the reasons that many of them end up in a loss….


Drawdown in Forex Trading Explained


Drawdown in Forex is defined as the difference between balance and equity from peak to trough. Keeping the drawdown as low as possible is a part of risk management. Higher drawdown means higher risk and high probability of wiping the account. It is recommended that in order to avoid high drawdown a trader must use a stop loss or low lot size, or low leverage. Drawdown shows the maximum risk…


Risk Management in Forex Trading

Risk Management in Forex

Risk Management is one of the most discussed topics in financial trading. Most traders end up with an unsuccessful trading journey because they have never studied what risk management is and how to implement it in their trading plan. Not having a trading plan is one other major drawback but today’s focus is on risk management and in coming articles we will cover trading plans for our readers. How Much…


7 Technical Indicators to Consider in the Forex Market

7 Indicators Chart 6

Forex traders analyse the market using either technical analysis or fundamental analysis. Technical analysis involves studying historical price movements while fundamental analysis involves studying news events. Technical analysis majorly involves using technical indicators to determine the probability of price moving in a certain direction. The indicators apply mathematical formula whose calculations are based on price. Technical Indicators can either be lagging or leading indicators. Lagging indicators follow price movement and…