Tag Archives: forex broker

Forex Trading Times

Posted by master on 2011/05/18 None comments

Knowing what the best times to Forex is a crucial component to effective and efficient Forex trading. During the trading week the Forex market is open 24 hours a day, but just because it is open around the clock does not mean prices are always moving in a way that makes a particular market worth trading. Money is made in the Forex market when the market is volatile and moving, not when the market is calm and relatively quiet.

So, as a Forex trader you need to know when the most active Forex trading times are, as this will aid you greatly in the timing of both your entries and your exits as you navigate the markets. The two most active Forex sessions are the London session and the New York session, during these sessions price action provides the best trading environment. The Asian trading session is often less volatile and thus less likely to result in major moves within the various Forex pairs.

The Forex market contains three distinct trading sessions; trading starts in Australia and Asia, and moves around the globe into Europe and finally ending the day in North America as trading closes each day in New York. The various Forex trading hours are as follows:

  • Asian trading session (including Australia and New Zealand): the Asian trading session opens at 6:00pm EST and closes at 4:00am EST

 

  • London trading session: the London trading session opens at 3:00am EST and closes at 12:00pm EST.

 

  • New York trading session: the New York trading session opens at 8:00am EST and closes at 5:00pm EST.

As you can see from the above list of times to trade Forex, there are periods each day where the sessions over-lap each other. It is within these periods when volume and volatility typically rise to peak levels. The London and New York trading sessions over-lap between 8am and 12pm EST, this is typically considered the best time to trade Forex. The reason it is considered the best time to trade is because this is when the world’s two most active trading centers cross; as London trading comes to an end, New York trading is opening, and they are both open at the same time for 4 hours each trading day. As a result, many traders strictly trade within this 4 hour window because it generally brings the best liquidity and volatility.

Beyond knowing the best Forex trading times, it also helps to know which currency pairs to trade. Generally speaking, the “major” Forex currency pairs are the best, the reason they are widely considered to be the best Forex pairs to trade is mainly because they offer the smallest spreads and highest liquidity. This means you pay smaller fees to trade the majors and they move in a “safer” manner than the “exotic” currency pairs, which can tend to jump around and move a relatively illogical way. In the end, make sure you know the best times for Forex trading and the best Forex pairs to trade; these are some of the basics of learning Forex.

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Forex Day Trading – The Largest Financial Market

Posted by master on 2011/05/04 None comments

Forex used to be one of the financial world’s best kept secrets. Being the largest financial market in the world, it should have been more well known, but it has escaped the sights of most people, remaining the domain of large corporations, huge banks, and financial entities, that apparently don’t like sharing information with the world. Investors of all levels are hungry for new markets to get into, and Forex is a prime candidate.

Forex day trading does not trade futures options or stocks, rather it trades currency. Unlike other financial markets, Forex doesn’t have a board that governs its actions, nor is there any kind of agreement process if a trader feels that they were cheated by another trader. Members work things out on their own through word of mouth and credit agreements, they must rely on trading with each other from day to day, it will benefit each member to trade with honesty and fairness. Self-regulation is very important in controlling the forex market.

Forex trading can be like a vacation for the trader who regularly deals with other financial markets. There are less governing bodies to deal with and less strict rules and regulations to follow when trading as well. For instance, in Forex, there is no “insider trading” – if you come across something either beneficial to the exchange rate of the USD, then you can feel free to capitalize on that information if you choose to do so. If you had this type of information in the stock market, it is considered a major crime. Forex day trading is not a simple walk in the park, even though at times it may seem so. Forex trades almost two trillion US dollars per day from Sunday to Friday. That is almost twelve trillion dollars per week, and six hundred twenty four trillion per year.

Before you begin to get the image of forex traders walking into a building with tons of cash ready to buy, sell, or trade, you need to understand a few things. The Forex market technically sells “nothing”. All trades are done by computer, and it might be best described as a “speculative market”. All the market does is it exchanges one currency pair for another, no matter what the reason may be. Another thing you need to know know, especially if you are considering using Forex day trading as a means to diversify your portfolio, is that the currencies always trade in pairs and insiders will refer to one as long and the other as a short. The long refers to the currency you have, the short refers to the currency you want to have.

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The Margin Advantages of Trading FOREX.

Posted by master on 2011/05/04 None comments

There is one aspect that is considered as one of the best advantages of FOREX Trading. This is related to the amount of money you need to place a trade, this is known as “margin”, and in short, this is all that can be lost in a the case you had a bad trade.

I state it like this because, even though I know with proper self-taught education you’re NOT going to lose as much as you win anyway, I want you to know that despite the super-high leverage associated with FOREX trading (200:1 is possible; meaning that if you put up $1 the trading vendor will allow you to trade like you really have $200), it’s still arguably less risky than futures (commodities) trading. And, forget stocks, you’ll never get this type of LEVERAGE in the equities market.

Futures markets are often prone to sudden and dramatic moves, against which you can not protect yourself, even by trading with protective stops. Your position may be liquidated at a loss, and you’ll be liable for any resulting deficit in the account. But because of the FX markets deep liquidity and 24-hour, continuous trading, dangerous trading gaps and limit moves are eliminated. Orders are executed quickly, without slippage or partial fills. And finally, there are no margin calls — for your protection, ALL our recommended brokers will automatically close out some or all of your open positions if your account equity falls below the level required to hold the positions. Think of this as a final, automatic stop, always working on your behalf to prevent a debit balance. In fact, if you pick from our list of recommended brokers, we guarantee that you will never lose more than you have in your FOREX account.

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