1 (edited by FXB trading 2017-05-24 03:54:23)

Topic: FXB Blog - Forex Articles

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Why Less is More in Forex Trading

Less is definitely more when it comes to trading the world’s markets – it really is crucial! To hammer this point home, we’ll look at 3 key points: market dynamics, price action and how not to react to every market fluctuation.

1. Don’t go against the trend
Reacting to each and every market movement is pointless. Make the trend your friend by not going against it with every time market fluctuation

2. Be patient with your trades
The next key point is actually a fact, and it’s that losing money SUCKS
The best way to NOT lose your money is by being patient with your trades. Once you enter the market, let the trade play for you. You cannot trade all those little movements in the market because all they are going to do is make you lose your money in the end.

3. The long-term dictates the short-term
The last thing you need to remember is that the long-term dictates the short-term. the long-term trend dictates the short-term fluctuations. Most traders try to trade every single movement in the market, simply because they are overconfident about their abilities and they think that they can trade every single counter-trade retracement, but sadly, they are likely to lose money.

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2 (edited by FXB trading 2017-06-01 05:42:21)

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Wise Trading Words from Pro Traders

Ever wonder how professional traders deal with the ups and downs of forex trading? Here’s a glimpse …
The most successful traders view forex trading as a game of possibilities. Sometimes you win, sometimes you lose. In fact, there are occasions in every trader’s career when a losing streak can seem to go on forever. Losses happen, but what sets successful traders apart is the way they deal with the ups and downs of the markets!

If you are at the point in your trading career where you just feel like quitting, take heart … All successful traders went through what you are feeling, but overcame their doubts to become seasoned traders. They still lose some trades, but they understand that losses go with the territory and all that matters at the end of the day is that your profits far outweigh any losses you make.
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5 Tips for Trading during Volatile Markets

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Trading opportunities are improved by a rise in volatility. The market fluctuates continuously which generates a positive mood for a great upward trend; however, there is also the possibility for significant losses if measures are not taken. When the market is volatile, adjustments regarding trading strategies need to be applied as the markets are uncertain.

Helpful advice for trading in volatile markets:

1. Trade selections
Volatility of the market can cause one to take the risk in order to derive profits.

2. Trade with smaller trade positions
Leverages affect trading largely when the market is volatile.

3. Discipline is the key to effective trading
Trade in a more disciplined way when the market is unstable. Maintain your trading strategy regardless of the market condition

4. Tighten your stops
Tightening stops can perform as great risk managers during periods when the market is volatile.

5. Pull up your socks!
It is essential not only to trade with currency pairs, but to adapt your trading strategy in the market situation

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An Introduction to Order Flow Trading

Order  Flow Trading is a profitable form of trading. It provides professional and retail traders with information based benefits, and  it offers the complicated step-by-step analysis of Order Flow in the form of charts that can be interpreted in a simple way. People have been puzzled about what Order Flow Trading(OFT) actually is.

OFT  takes into account other forms of trading. The aim is to attempt to predict the prices of the stocks through pending orders of other traders. In anticipation of prices it is important to ensure that potential traders have large orders; the traders should be active market participants who have pending orders.

Scary facts about Order Flow Trading

Trade mentors have been advising  the traders to trade what they see instead of trading what they think. The market does not actually move according to your thoughts and it should not. Picking levels is a risky way to exercise your trading, and has been banned by professional traders. However, Order Flow Trading cannot be implemented without picking levels, and this is the reason why OFT has been frightening for many traders.

Traders who were mentally picking up levels, and simultaneously observing the price charts discovered that the levels had been all blown away. However, things can vary by using tight stop losses and especially if you consider picking levels carefully. Consider picking levels with caution and use tight stop losses.

The Methods of Functioning of Order Flow Trading

Picking up levels is actually a complicated matter. OFT needs proper analysis power which most of the traders miss. With the help of proper training, technology and proper support you can learn how to  pick levels to continue with OFT. There are methods of Order Flow Trading:


  • The trading method, which is recommended by expert traders, is to determine the apparent resistance levels which is confirmed when the price arrives. This is one of the methods of order flow trading since the system is dependent on there being a great deal of orders on the different levels.

  • The professional traders of order flow trade in a different way. If you know how to trade order flow then you will definitely not wait for confirmation of price action before trading order flow. This is quite a risky approach to OFT.

  • Wait for the close of hourly candle before you enter the trade.

  • Pick up the levels to enter a better price. This will assist in getting a higher price which will result in profits long before traders who trade with price action enter the trade.

  • Use tighter stops to place your stop in a much better pace which is the advantage you gain while trading with level-picking.

Trading against the given trend should not intimidate you. Obvious support and resistance can be achieved through the previous highs and previous lows which is the way to pick up levels.

5 (edited by FXB trading 2017-09-14 03:39:11)

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Online CFDs Trading

Benefits of Online CFDs Trading in Foreign Exchange Trading

Forex market is the greatest money market in the world as well as the best platform that offers sufficient trading facilities. People can begin with demo accounts to gain skills and knowledge. Then they can start investing with their minimal investments and can become millionaires in a short time. However, in order to minimize the risk, they can use online CFDs Trading that makes investors hedge their investments to reduce the risk.

What is Online CFDs Trading?

CFD in Forex market represents the contract for differences that you can make in order to reduce the amount of risk with a particular investment or currency. These contracts are now being offered to the millions of Forex investors that use the Forex online trading system. It is not necessary for people to visit their brokers in person and look for the trade of CFDs. They can access all the offers through online CFDs Trading and can make suitable investment decisions accordingly.

How is Online CFDs Trading Useful?

CFDs offer people an opportunity to diversify their investment and minimize the risk associated with a particular currency’s trade. This risk can be transferred by investors trading through online CFDs Trading. Every investor has their own risk tolerance level. The best financial partners can provide risk management strategies which can be implemented with the support of online CFDs Trading. Huge returns can be made on investments by receiving the best risk management strategies from reputable sources.

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Online Trading Platforms and Stock Exchanges

The stock exchange market is one of the most liquid markets in today’s economic environment. Trading in shares on these markets is one of the most important activities nationally and globally as it is one of the most effective ways in which companies can increase capital with minimum loss. It also gives traders the opportunity to earn profits.

Traders can choose to use one or both of the available channels to trade in stocks. These are online trading platforms and stock exchanges.

The similarities and differences between online trading platforms and stock exchanges are outlined below in order to provide traders with appropriate information about which method to choose.
Charging of Commissions

The two methods have similarities because in the traditional stock exchange, the stock brokers will always charge a commission on every stock that is traded through them.

The same is also true for online trading platforms because online brokers will also charge a commission on the traded stocks. Sometimes this is hidden in the costs, but in spite of what is usually said, they may not charge a lower rate than the stock exchanges. These rates vary from one online broker to another and sometimes may be higher than those in traditional stock exchanges.

Capital Gains Tax

Governments usually impose a stamp duty in form of a capital gains tax on any stock that is traded on the stock market.

Regardless of the platform, whether it is stock exchanges or online platforms, the trading of shares will attract this tax.
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Strategies for Successful Forex Trading

Are you already a trader who is involved in the forex business and would like to further increase your knowledge of the stock exchange in order to become a more skilled trader? Or maybe you have just started forex trading and require all the relevant information about forex? Whatever the situation may be, it is your opportunity to start implementing what you have in mind. You can earn a large amount of money using these new forex trading strategies. You just need to monitor several forex indicators, and the rest is simple.

Have you had enough of fighting against the foreign capital and the market? Are you annoyed with making attempts in forex trading that earn no profit? Or is it the difference of time zones that is causing problems in your trading?

Eliminate all these problems today! Our strategies work automatically so you are not required to monitor the events in the market all the time. You can effectively manage the events while simultaneously enjoying the swing trading using these Forex trading strategies. Certainly several traders have already tried to employ our trading strategies and have achieved great results in the process. The major advantage of these Forex trading strategies is that you can follow the progress by using paper, in tabular form and on the real success stories.

These recent strategies have been devised after thorough Forex market research, based on intensive analysis of the patterns and estimating the specific number of indicators that are responsible for given processes and changes that influence the market. These indicators are the basis of any successful Forex trading.

Let’s move towards achieving goals!

1. Have you been unsuccessful in forex trading? Or maybe you are a beginner who has heard a lot about making money through forex trading but don’t know how? We can help you to overcome these difficulties.

2. We advise you to forget all bad experiences in order to move ahead and start planning the future. We can develop new strategies to help you.

3. Based on well thought-out strategies which have been thoroughly tested, you follow specific market indicators and make careful decisions. The decision-making has become easier with these strategies. They enable you to detect the direction of a currency pair and allow you to create effective techniques to make the most of available opportunities.

8 (edited by FXB trading 2017-09-20 03:11:21)

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Successful Foreign Currency Trading[/SIZE]

In order to successfully implement foreign currency trading strategy, you must be able to recognize, assess and track trends within the Forex Exchange Rates so that you can determine whether it is a good idea to trade or not.

When choosing the currency pairs to trade in as well as establishing the strategy, it is essential to take time to read the historical information as well as evaluating pricing charts so that trends in the Forex Exchange Rates can be followed.

How to Determine and Use Forex Exchange Rates

Many forex traders prefer not to carry out a lot of research and perform with what they have. This is where the Forex software is extremely useful as it only requires past data to begin evaluating the Forex Exchange Rates, and gives recommendations about buying and selling of different trade indicators.

The software creates these trade indicators after examining the progress in the Forex Exchange Rates in a certain period of time. The trading software is programmed to identify any defined trend in the exchange rates as the prices change.

Are Forex Exchange Rates reliable?

At a national and global level, the foreign currency is one of the biggest markets as well as the most volatile place in the economy. The reason for this is because the prices can fall or rise in minutes. Therefore, it is very important to acquire a trading account that will permit you to carry out the tracking and monitoring of the Forex Exchange Rates in real time.

Trading in out-dated exchange rates is usually not advisable because they have a higher risk of losing and taking traders away from their planned profit margins.

Real-Time Forex Exchange Rates or Historical Data?

Historical and real-time data is significant for all forex traders, and have a big role to play in ensuring that the trading strategy becomes successful.

Historical data records changes in pricing of a particular currency over the past few months, or even years. This is really important during the creation of a trading strategy and inputting data into the trading software. The more data there is, the more likely it is for the software to identify the actual trends.

When the actual trades are placed, real time forex rates should be employed to avoid paying too much to buy currency or closing the trades at a loss due to slippage.

Why do Forex Exchange Rates vary for every brokerage website?

As the stock market is volatile some websites may not be updating their rates as fast as they change which makes it appear like different sites have a varied pricing.

Furthermore, some brokers may place their commissions into the spread by adding some pips in the difference between the bid and the ask prices. The result of this is a dramatic change in the pricing in comparison to other brokers.

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Technical and Fundamental Analysis

The rule followed by all investors in all markets worldwide is that they are looking to earn money. However, if they closely analyse and assess the movement of the foreign exchange market or the stock market, they would discover that the nature of the investments being made in these markets, and the nature of the money being placed, is similar to an activity that is well known for either providing heavy losses or enormous profits. This activity is gambling.

Businessmen who gamble for too long often find that they have run out of luck, and this loss of luck eventually leaves them on the streets after they lose everything. This is because gambling is an extremely high risk activity, and is partly based on luck. The high risk nature of this activity can result in profit if the gambler has good luck. However, the balance of probability states that the gambler’s luck will eventually run out, and when the gambler’s luck runs out, he will find that he has lost everything that he had previously earned.

Hence, the smart businessman does not gamble often, and definitely never gambles with everything that he owns. Businessmen who become rich and remain rich usually take a more analytical approach to their investments, especially when these investments are applied in volatile markets such as the stock or foreign exchange market.

In order to minimize risk, businessmen employ analysis techniques so that they can gather information to assist them in making investments that would be profitable.

There are two main analysis techniques that are implemented by traders:

1) The first analysis technique is called technical analysis. Technical analysis involves the studying of past trends in order to ascertain patterns. If the market that you are trading in seems like it is following a previous market trend, the trader can act based on this trend. If there is a pattern, technical analysis usually provides a safe prediction of how the market will behave in the future, and the use of this analysis technique can help investors and traders make sound financial investments in the markets.

2) The second analysis technique is called fundamental analysis. Fundamental analysis involves studying the statements and financial dealings of the business in order to determine the amount of assets, liabilities and earnings, as well as the statements and financial dealings of competitors and an in depth analysis of the market’s current status. All this information can give a trader an idea of which businesses may be making a profit in the future, and knowledge regarding future profitability of businesses can allow the trader or investor to make a healthy investment or purchase and earn a profit.

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The Global Debt Pyramid Scheme and Leverage

There is a widespread global problem which was inevitable after paper money had been introduced. This problem is that almost every country in the world is in debt.

Debt is an extremely fascinating concept as governments need money in order to run countries. It’s an obvious fact that running a country costs a lot of money. Governments obtain money from the people they govern as governments are not entities that are run for profit, nor do they own profitable businesses or any other ways of earning money. This money is assigned as taxes, and it is considered the obligation of the citizen of a country to pay their taxes in order to provide their government with enough funds to run the country.

Essentially, the government uses these funds (taxes) to run the country. All tax money should be spent on the country, but governments often surpass the amount of these funds. Government expenditure is similar to the spending of people because it usually exceeds their financial means. Governments printed more money and referred to this money as debt to justify the spending of more money. This money is used to pay for everything that taxes would have paid for. This money though is debt.

Spending money that is not owned by the government is a widespread global economic problem. Global debt has increased so much and is now estimated to be more than one hundred trillion dollars which is growing at an increasing rate every day.

This massive debt has placed the global world economy on the edge of disaster. The tiniest movement could cause a huge change, something that has been experienced in Italy. Italy was reduced from a pillar of European economy to a beggar state due to an increase in the interest rates by only two per cent. If interest rates change drastically, entire countries could go bankrupt. This system that has been created is essentially faulty as it involves the attribution of monetary value where there is no value. Money has a much greater value than the paper it is printed on, and from the time it became cheap to make money, governments have been spending a lot more than they actually had.

No one knows where this will end up, but it is enough to say that when the balance is changed, natural order will be resumed suddenly in an aggressive way.

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Is time running out on US Dollar as the leading reserve currency?

The might of the USD and its position as the leading reserve currency has been called into question by numerous analysts over the years.

During periods of political and economic uncertainty doubts about the USD attract a wider audience, prompting further proclamations about its demise.

Some analysts claim a collapse is imminent, others predict that it is just a matter of time and yet it remains the most highly traded currency in forex, the dominant currency in international trading and remains the leading reserve currency.

It has history on its side and is clearly still trusted by its trading partners.

But the question of its future warrants consideration as it comes under threat from the EUR and other currencies who may be ready to challenge the USD as the dominant reserve currency.

TROUBLE FOR TRUMP’S ECONOMIC POLICY

When US President Donald Trump came to power in 2016 he pledged policies that would propel the value of the USD to new levels. The objective was to boost US structural economic growth while at the same time reducing the US trade deficit.

Trump’s plan was going to be achieved by making large investments in infrastructure and extensive tax reforms in combination with a highly protectionist trade policy.

Thus far Trump’s plans have been hamstrung by political division and budget constraints. The US trade deficit continues to grow and there’s been little sign of the promised protectionism.

Concurrently, doubts about the eurozone’s future, following the Grexit crisis and the shock of Brexit, have receded. Germany’s vision of economic convergence is shared by new French President, Emmanuel Macron, a pro-European reformist, and this axis has rejuvenated the EUR. It is pressing a strong claim, similar to when it was first launched, as a rival reserve currency as foreign investors shift capital into the eurozone.

If US trade deficit continues to grow while the eurozone finally delivers on its potential, then a sustained period of EUR performance would follow and prove it might be a viable alternative to the USD as the leading reserve currency. It’s one of the key conditions that would make the prospect of a USD collapse easier to accept and navigate through.

The eurozone is not alone in its ambition to establish the EUR as a reserve currency. China will also look to benefit from uncertainty regarding US’s strength, and Asian countries will be more sympathetic to their offer of a closer relationship.

Gold has also benefitted from the apparent weakening of USD’s status, recently peaking in value after years of slow decline.

Bitcoin has the potential to stake a claim, but it’s too soon to be sure if it can accede to the role.
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Strategies for Successful Trading DecisionsGoing Short or Long

The Forex market is quickly becoming the focus of attention for millions of new entrants as a result of its unique advantages. A large number of people have learnt how to make clever investment choices in order to take advantage of the market. Two strategies in Forex are going long and going short – once you understand these two strategies you will be able to make important decisions in order to be profitable. The two main strategies will be examined below.

Going Short

This trading strategy is when the base currency is sold in order to buy it at a later stage when the price begins to fall, resulting in a return from the transaction. For example, if the current GBP/USD is 1.5345 meaning we pay 1.5345 Dollars for one Pound Sterling, and we have $1000 dollars, we would sell the Dollars in order to purchase the Pound Sterling. This is carried out when the cost is expected to fall again in a short period of time. When the price GBP/USD falls to 1.5350, this means that more Dollars can be purchased with the same amount of Pounds that were obtained at the start. The additional dollars can be kept as profit which were earned by considering the dollar as the base currency.

Risk in Short Position

As with all financial markets, forex involves the same amount of risk. If the prices go in the exact opposite direction than originally expected, there will be a loss instead of a profit. For example, if the GBP/USD goes to 1.5340, you would not even get the same amount of Dollars that you sold initially. This strategy is only profitable if prices drop.

Going Long

In the Forex Market, going long refers to buying of currencies with the intention of reselling them later when the price increases. If you notice an increasing trend of a currency for a long period of time, then buying would be the correct option and keeping the trade open until the price reaches its maximum point before reversing. For example, if GBP/USD is showing an increasing trend for the past few hours or days and the current price is 1.5400, then you can sell the Dollars to purchase the Pounds and wait for the prices to get to the desired level. When the price gets to 1.5500 you could sell as that earns you more Dollars than your initial investment.

Risk in Long Position

There is the risk of the price falling once you have purchased the currency. In this situation, your loss would equal the difference in the price at the point which you bought the currency and the price at which you are selling it. Regardless of the investment in the Forex market, it is essential to know the market trend and the economic conditions of the base currency.

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Advantages of Forex trading

Forex is an acronym for Foreign Exchange Markets. Forex is also represented by the symbol FX which is a familiar term among investors, bankers and stock brokers across the world. The Foreign Exchange Market or currency market is a global, decentralized market for trading of currencies. The principal participants in the FX market are major international banks.

Financial centers around the world offer buyers and sellers a convenient platform for trading in currencies. In addition, the FX market operates on several levels.

The unique advantages of FX trading.

24 hour market
FX trading operates on a 24/7 basis except for weekends. Trading around the world begins when the markets open in Australia on Sunday evening and closes when markets end at New York Stock Exchange on Friday evening.

High Liquidity
Liquidity is when you can easily change an asset into cash with minimum price fluctuations. In the forex market, transactions can easily be carried out by moving huge lots of foreign currencies in and out of the market with least price fluctuations.

Low transaction cost
The cost for a transaction is added with the price i.e. the buying price of the currency. This is known as a spread – the difference between the buying price and the selling price.

Leverage
The leveraging factor is the ability to trade more money in the market than that which is actually available on the trader’s account. Forex brokers allow traders to make profits on the leveraging factor. If you are allowed to trade on a leverage factor of 50:1 ratio it means you can trade for $50 with $1 capital available on your account.  You can control a trade volume of $50,000 with just $1000 worth of capital.

In order to be able to buy and sell foreign currencies, you need to open a Forex trading account online. For every FX currency you buy, your account will be credited with the same amount. For every FX transaction you carry out in terms of selling, the corresponding currency will be debited from your online Forex Account. The profits you gain will be wired directly into your account through Paypal.

Profit potential from rising and falling markets
You can trade freely in the market as far as your potential goes. If you believe that the price of a currency will increase, you can buy it or go long. Increased currency price indicates you can sell it at the  increased price. You can make up for huge profits by trading on volumes. However, if you believe that the currency value is going to fall, you can sell it or go short.

Seasoned stock traders can make huge amount of profits and even become overnight millionaires. On the other hand, if you desire huge amount of profits and start trading without following the tricks of the trade you can also end up losing a lot of money. Therefore, you should always be cautious while you are operating in the Forex market or stock market.

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Avoid the pitfalls of forex trading robots

Forex trading robots have become a popular tool in the personal forex market. They’re often attractively priced and are marketed as ‘Expert Advisors’ that can operate on many of the favoured trading platforms. However, an increasing number of traders have been left disappointed with the purchase of their automated forex trading program that ends up performing well below expectations, which leaves them feeling cheated and even results in claims of fraud.

Sold on profits

Anybody with a product to sell will focus on the product’s most attractive features to get you to buy it, and that is especially true about automated trading products. Often, they’re presented as offering the path to financial freedom and being easy to use; claims that are backed up by historical trading profits and glowing testimonials from seemingly satisfied users. In reality, the evidence of their success is just a small sample of trading when the software enjoyed a profitable spell and leaves out the less impressive other periods which more accurately reflect its true capabilities and how it performs for most of the traders who buy it.

The disclaimer makes it alright

Every forex trading robot is sold with a disclaimer (sometimes well hidden) that denies any responsibility for how it will perform in the future. The words may be different each time, but the message always amounts to the same thing: there’s no guarantee this software will trade profitably based on its historical performance and is there to protect the vendor from potential fraud claims.

Get a refund but not your money back

In an effort to placate customers who were unhappy with their trading robot purchase, many vendors would simply offer a refund. But while the purchase price of the forex trading software would eventually end up back in their bank account, the money they lost using it was gone.

Trawl through any online trading forum and it won’t be long before you come across a thread full of unhappy traders who feel they’ve been misled by false advertising about forex trading robots that fail to deliver profits.

Traders who purchased the forex trading software through Clickbank tend to have an easier time getting a refund. Legitimate claims made by the purchaser within the 60-day / eight-week period are usually dealt with quickly and efficiently.

While it is not recommended that traders purchase a forex trading robot, if you do so, make the purchase using Clickbank and thoroughly test the software during the risk-free trial period to minimise the financial impact if the trading results prove to be disappointing.

Too good to be true

The saying goes: if it’s too good to be true, it probably isn’t. Genuine innovation has made our lives easier and better, but if trading software was capable of delivering the results vendors claim it can – and for such a small investment – why do banks continue to pay their forex traders six figure salaries?

The simple truth is that it isn’t possible for trading software to deliver positive results on a consistent basis. Successful forex trading can be learned and is highly profitable, but it requires skills and judgement that simply can’t be replicated by software.

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Forex coaching pays dividends

Trading forex is a bit like driving, if you don’t get a few lessons from someone who knows what they’re doing you’ll probably crash. A good forex trading coach will help you become a profitable trader far sooner than if you dive into trading without proper training.

A good trading coach, much like a good driving instructor, is aware of the mistakes a novice is likely to make and is able to steer you around or away from them and can explain why a certain course of action or choice is the better option. Much like driving, most of us want to learn so that we can use it safely, frequently and of course successfully. Driving without caution or at high speeds, without understanding the dangers, mirrors unprofitable or high risk trading and inherently increases the chance of losing money.

Once you’ve accepted that coaching is the best way to start the next step is choosing which coach is right for you. In most situations where you need an expert, your natural instinct is to gravitate to the best available. This is where most people run into their first hurdle, as the industry is littered with so-called ‘forex gurus’ but who are not even professional traders.

A recommendation from someone you know and trust is always a good place to start, but if no-one you know can advise you on coaching for forex trading there are some things to look out for which will help you make an informed choice.

‘Try before you buy’ is a good way to get a better idea of the quality of the training a forex coach is able to provide, so it makes sense to look into some of the free training advice your potential coach might offer on their website.

If the coach you’re looking at doesn’t offer any advice for free and is simply trying to sell you a product that makes some grand promises based on past performance it is best to stay clear.

Another simple test to carry out is to discover if you are dealing with a real person. A forex coach who features in his or her own videos and uses their real name is more likely to be a genuine trader with something useful to offer. Try out the phone number, email or any other contact information provided and check out if they are really on the other end of that communication line. If they are present it means they’re also accountable and that is a sure sign they are confident in what they’re offering.

People who constantly seek out new learning tend to be more successful than those who settle on what they know and plod a familiar path. Coaching provides an ongoing learning process, even for those who are already at the top of their own mountain. When Rafael Nadal achieved Number 1 status in the tennis world the first thing he did was increase his coaching staff.

It’s one thing to learn something, learning to apply that knowledge is the next step then learning from your own experiences is yet another. This applies as much to forex as it does to all walks in life that require special skill or knowledge. Forex coaching provides the opportunity for continuous learning, regardless of how long you’ve been trading, and is an essential component of long-term success.

One-on-one training has been shown to increase the rate someone learns by 70%-80% and there is no quicker way to learn how to make consistent profits in forex trading.

5 reasons why coaching will make you a better trader:

1. Our natural instincts teach us to learn from our mistakes and novice traders naturally employ this trial and error method. However, this results in a novice taking longer to learn how to trade profitably, sometimes years, and in that time they are likely to have picked up some bad habits. A trading coach will challenge the way you think and your trading paradigm, the trading coach will also identify your bad habits and help you replace them with profitable strategies.

2. Nobody likes being told they’ve done something wrong and it’s one of the reasons some traders resist the idea of training. But throughout our lives the biggest and most important lessons we learn is through the mistakes we make, not our successes. A good trading coach will be able to offer constructive criticism and teach you how to learn from mistakes.

3. Some, if not most, people who start out in forex dream of achieving huge wealth and overnight success. Forex trading is about creating a plan with realistic weekly, monthly and yearly goals that get a trader to a target. Having a target without a plan is simply dreaming. A forex coach will help you establish realistic and achievable goals that will ensure you reach your target.

4. A common problem novice traders face is becoming overwhelmed with irrelevant information. A trading coach will help you to focus on the information that matters and how to stay focussed on the information and avoid wasting time on details that can steer a trader away from their targets.

5. Another common problem that afflicts traders is when they get stuck on a certain level of knowledge. It can be hard for a trader to recognise this in themselves which is why having a coach is vital as they will see it and know how to get a trader to move forwards again.

In short, a good coach will tell you what you need to hear when you don’t, and see what you need to see when you can’t. A good coach will help you achieve your goals.

In the past coaching was seen as something that only professional athletes used, but successful traders have realised the benefits of forex coaching. In the long term it saves a trader time and money and eventually proves to be a worthwhile investment for the future

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Profit from North Korea crisis

The North Korean crisis has been preoccupying the minds of investors for a few months now. Back in April, North Korean leader Kim Jong-un ordered missiles to be fired over neighbouring Japan. The ensuing market instability prompted varied reactions from investors.

The risk averse headed for the safe haven markets, while others tried to capitalise on market volatility.

Today, the picture for investors has changed significantly.

As you read this (September 18) world stocks are at an all-time high. Investors have regained their appetite for trading in risky assets. Currency trading appears unaffected by events on the Korean Peninsula.

MARKETS BREATHE SIGH OF RELIEF

The markets have breathed a collective sigh of relief and for traders, with the risk of a nuclear war averted, North Korea has drifted to the back of their minds – for the time being.

The note of caution is sounded because it’s far from being a settled issue, and major powers are already drawn in.

On Sunday (September 17) US President Donald Trump appeared to mock Kim Jong-un.

“I spoke with President Moon of South Korea last night,” the US president wrote. “Asked him how Rocket Man is doing. Long gas lines forming in North Korea. Too bad!”

Despite the rhetoric employed by Trump and the US administration that “fire and fury” would be the US reaction to Kim Jong-un’s continued missile firing, their preference, so far, has been to see economic sanctions imposed on North Korea.

SANCTIONS SO FAR

The United Nations Security Council passed sanctions against North Korea. In turn, Kim Jong-un responded by firing another intermediate-range ballistic missile that flew over Japan and a promise that more tests were on the way.

These sanctions seem to be taking effect on the country, hence the reference to “Long gas lines”, if not Kim Jong-un himself.

A notable side effect to the crisis has been its effect on US/China relations which saw US Treasury Secretary Steve Mnuchin threaten a trade war with China if it didn’t uphold its sanctions against North Korea.

The markets would react with far more volatility if this were to transpire, and you can be sure investors will be paying special attention to US/China relations as the North Korean crisis unfolds.

ASIAN MARKETS SOARING

But, for now, it seems investors have become desensitised to the North Korean issue. As long as Kim Jong-un holds back from declaring all-out war and US/China trade relations remain intact, the market seems to have decided that trading shouldn’t be affected.

Stock markets in Asia are at their highest level in a decade (Monday, September 18) and this positivity is mirrored in markets around the world.

However, if fears about war increase again, look out for its effect on the value of the USD.

Historically, the USD’s value plummets when there is trouble on the Korean Peninsula. Going back to 2010, when tensions were provoked by South Korea, the value of the USD dropped significantly against other major currencies.

Both the US and North Korea show no intention of backing down, so an escalation is still possible. In the short term, this would most likely see the value of USD increase, as it’s a war North Korea can’t win. But war in the region would inevitably see South Korea and Japan being sucked in and result in collateral damage to those nations. They are both trading partners with the US and this could end up having a negative effect on the value of the USD

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German Elections: Will Merkel hold on to power?

Elections in economically powerful countries like Germany have always provided an opportunity traders can take advantage of, because of the market volatility that preceded them.

The uncertainty that surrounds an election result creates turbulence in the markets, which are exactly the conditions traders need to make bigger profits on their trades.

If recent history has taught us anything, it is to expect the unexpected when the German Election takes place on Sunday 24th September – regardless of what exit polls and the media are reporting will happen.

EXIT POLLS ARE LESS RELIABLE THAN BEFORE

Opinion polls have consistently predicted that Angela Merkel will secure a fourth consecutive election victory for her Christian Democratic Union (CDU) party and their sister party the Christian Social Union (CSU).

However, exit polls are not as reliable as they once were. Britons were expected to vote against Brexit and Hilary Clinton was considered a more likely US President than Donald Trump.

The pulse of the voter is far more difficult to anticipate, and more susceptible to change.

The impact of social media and other, less predictable influencers, can have a significant effect on the opinions and perceptions of voters, especially in those critical last few days before the election itself takes place.

No outcome is certain until the last votes have been cast.

MARKETS BECOME MORE VOLATILE AROUND ELECTIONS

This uncertainty creates volatility in the markets, which tends to become more pronounced as the polling date approaches and even more so if the outcome is in the balance.

That volatility is magnified when an unexpected outcome is declared, as when Britons voted in favour of Brexit.

This is why the German election offers the potential to make some money.

In the immediate aftermath of the Brexit vote Sterling (GBP) plunged to its lowest level since 1985, and two years later it has yet to recover.

Another unexpected result in Germany would trigger another period of market turbulence.

Traders are already calculating how to react depending on the outcome. This is an opportunity to make significant profits – it’s a question of picking up on the right indicators.

HOW WILL GERMANS VOTE?

On the face of it German voters have less reason to produce a surprise result. The country is economically strong and thriving. But recent statements and actions by Merkel, such as her decision to welcome over one million refugees into Germany came in for heavy criticism and resulted in her personal popularity dropping to its lowest in years.

How much of an influence will this have on voters come the election?

Merkel’s record as Chancellor is impressive. She has successfully navigated the recession that has affected most of Europe. But their manufacturing might has never been in doubt, Germany was always better prepared than its European neighbours to come through the economic crisis in good shape and without its people suffering any great hardship as has been witnessed in other countries.

If the economy isn’t a significant factor affecting voting then other matters could be more prominent in voters’ minds. Germany’s role in a fragmenting Europe, or its support of military campaigns abroad against Isis and the retaliations it has provoked in France, the UK and Spain may persuade votes that a change in policy is needed.

COALITION IS THE ONLY CERTAINTY

Despite being the dominant party, Germany’s electoral system has required Merkel’s party to form coalitions in all three of the CDU/CSU’s successes. If anything is certain about the forthcoming election it is that it will be another coalition government that takes power.

In 2013, the previous coalition government failed to gain the necessary majority of seats needed to maintain power. Coalition partner, the Free Democratic Party (FDP), attracted less than 5% of the vote which resulted in a coalition being formed with the Social Democratic Party (SDP). It was referred to as “a grand coalition”. But this may not be repeated given the fall-out between the respective leaders – Martin Schulz of the SDP and Merkel – over the issue of immigration.

Schulz is considered Merkel’s biggest challenger as Chancellor. The SDP are expected to achieve around 25% of the vote according to the latest opinion polls, making them the CDU/CSU’s biggest competitors.

Schulz’s popularity has strengthened following his stint as President of the European Parliament and he is liked by a significant number of the country’s voters.

If Schulz was to overcome Merkel on September 24 it would send shock waves around the world, the markets are likely to go through another period of instability and the Euro (EUR) might be affected in the same way Sterling (GBP) was affected by Brexit.

If Schulz garnered a greater portion of the vote, but not enough to replace Merkel, it could still increase his influence on policy making. Assuming the coalition remained intact, the Euro (EUR) is likely to strengthen as Schulz is in favour of strengthening the EU.

Some will certainly feel backing the Euro (EUR) makes a lot of sense as the election approaches. Schulz’s heavy criticism of Brexit (he called for the UK to re-run the referendum) could have further ramifications for Sterling (GBP). The prediction by one prominent global investment bank that Sterling (GBP) will be valued on a par with the euro by the end of 2017 would seem far more likely.

Merkel has been far more diplomatic to the UK following Brexit and promoted the benefits of Germany and the UK maintaining a strong economic partnership. Following through on this stance will raise optimism that Sterling (GBP) will rally.

CREATING COALITIONS DISRUPTS THE MARKETS

In the days before the elections prominent European indices, notably Germany’s DAXX and the wider European indices such as STOXX 50, expect increased volatility. This will be magnified or return to stability dependent on the outcome of the September 24 vote.

However, if a revised coalition is created, this might also prompt increased volatility.

After the last German election it took around three months for the new coalition to be sworn in. Equity markets fluctuated between periods of increased volatility and inaction during that period, depending on how coalition negotiations were perceived to be going.

The Euro (EUR) was similarly affected until the outcome was confirmed.

Staying up-to-date with the events leading up to the elections and observing the effects they have on the markets will give an insight on how the markets will react as we approach September 24.

Clearly, we shouldn’t be surprised if another ‘shock’ result came about. But whatever the eventual result the opportunity lies in judging how the market is reacting every step of the way and taking full advantage of the opportunities as they arise.

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Don’t write off Sterling prematurely

Last June’s post-Brexit vote sent GBP values plummeting against EUR and pretty much every international currency as the market tried to price in the negative implications for the UK economy.

As unexpected as the vote to leave was, the market reaction – perhaps overreaction – was entirely predictable. The vote was preceded and followed by a raft of analyst predictions of a weak GBP amid fears Britain’s economy would grow more slowly outside of the EU.

However, amid the eye-catching headlines, pro-Brexit economists said that leaving the EU would cause a shallow downturn at first but would end up boosting the UK economy in years to come.

GBP RECOVERS DESPITE GLOOMY PREDICTIONS

Despite difficult Brexit negotiations and the continued uncertainty surrounding the UK’s relationships with the EU going forward, GBP’s subsequent recovery says plenty about its historical importance and longevity and that needs to be factored in when predicting its future value.

GBP’s is the oldest actively traded currency on the foreign exchange market, it’s also one of the most popular currencies traded on forex as a result that London is one of the biggest trading hubs in the world.

Political uncertainty and war has triggered volatility in GBP’s value over the years, but it has always stood the test of time and has been relied upon as a global safe haven for investors.

History seems to be repeating itself.

BARCLAYS FORESAW GBP RECOVERING

Back in March this year Barclays, one of the UK’s most prominent financial institutions, wrote to their clients to say they could see GBP recovering against both EUR and USD.

On September 17, 2017 HSBC admitted it was wrong to predict a deep dive in the value of GBP this year. The banking giant had previously said GBP would end the year at $1.20 and around parity with EUR, their bearish currency analysts have now revised their forecasts to $1.35 and €1.12.

The difference is that GBP is now behaving like a normal, cyclical currency and moving after things like data events. It is now less susceptible to Brexit developments.

The Bank of England’s (BoE) announcement that a first interest rate rise in a decade sent GBP to its highest level since the day after the Brexit vote. The BoE said rising inflation and stronger household spending merited an increase in the coming months.

UK ECONOMY LOOKING AT NEW MARKETS

BoE Governor Mark Carney, in remarks prepared for Washington today (September 19), said a long period of inflationary pressure on the UK was expected as it reorients its economy toward new markets and away from the EU.

In the immediate aftermath of the Brexit vote and GBP’s dramatic fall in value Carney said he was happy with Sterling’s level and wasn’t averse to a further depreciation. He explained that a weaker GBP was an important reason why the economic effects of the vote to leave the EU would be less than gloomier pre-referendum predictions suggested.

In other words, a weaker GBP was helping to limit damage to the British economy during the Brexit process. The natural reaction to ‘weakness’ is that it is to think of it in negative terms. However, certain situations warrant a weakened currency valuation. UK produce became cheaper, this stimulates demand, and helps cushion the wider economy from turmoil.

The UK lessened the damage of global financial crisis in 2008 in a similar way.

ECONOMIC GROWTH AND STRONGER GBP PREDICTED

While the long-term ramifications of the Brexit are unknown Brexit supporters have consistently argued that it will result in greater potential economic growth and appreciation of GBP through a reduction of government spending and the establishment of trade alliances independent of EU regulation.

Carney describes Brexit as a unique example of deglobalisation and while the economic effects of Brexit are subject to “tremendous uncertainty” it will mean lower immigration to the UK which will potentially boost domestic wage growth while new barriers to trade would lead to higher prices for goods and services.

While the long-term future of GBP’s value looks safe, unpredictability is a possibility in the short-term.

GBP WEAKENS IN 2018?

Upon revising their GBP valuations HSBC added that 2018 is likely to see Sterling weaken again. Their economists feel that politics will have a greater influence on GBP’s value as the deadline to Brexit nears. They offer a worst-case scenario where no Brexit deal is agreed and the UK economy starts to slow as a result of BoE interest rises.

HSBC concluded that GBP would drop “well below” $1.20 and around €1.05. But as they were forced to admit yesterday, they might be wrong.

There’s little doubt business fears are rising.

More than 100 companies, including Ford, GE and IBM, wrote to Britain’s top Brexit negotiator and his EU counterpart on Sunday urging the two sides to agree a transitional period of up to three years so that they could make investment and employment decisions.

Britain’s Prime Minister Theresa May is hoping some momentum will be sparked by her speech when she visits Italy on Friday (September 22). It will a key address designed to set out Britain’s latest position. Talks will resume the following Monday and it remains to be seen how they will develop and how investors react to any developments. One thing for sure is that it will be a thrilling journey for GBP.

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Water will be a more valuable commodity than oil

Water will become a traded commodity, like oil, gold and silver, it’s just a matter of time.

70% of earth may be covered by it, but less than 1% of it is readily available freshwater, which makes it a scarce resource.

It’s value to human life is unquestioned – oil, gold and silver we can live without – we die without water.

The problem for Wall Street and the major international markets is that in addition to overcoming the difficulty of attaching a price to something so essential to our lives, for it to become a traded commodity it also needs to fulfil three criteria: standardised/interchangeable, tradeable and deliverable.

WATER IS MORE EXPENSIVE THAN OIL TO TRANSPORT

Water is always made up of H₂O, but the levels of minerals and metals it also contains depends on the location it is drawn from thus making it difficult to standardise.

Its tradability is dependent on location. There are parts of the world have so much of it their biggest problem is flooding. In others it’s a scarcity and they suffer droughts.

Water is also costly to transport – it costs more to pipe water than it does to pipe oil.

So how can it be said with any certainty that it will become a tradable commodity?

Jean-Louis Chaussade, the chief executive of French utility Suez, recently told the Financial Times that he believed water will become more valuable than oil because of the increased demand from people, industry and agriculture.

DEMAND FOR WATER IS INCREASING BEYOND SUPPLY CAPABILITIES

The United Nations has projected that by 2035, 40% of the world’s population will live with water scarcity. This puts companies in competition with people and farming for supplies.

Local governments around the world are refusing to allow industries to take water from underground to operate which is forcing them to turn to desalination plants or waste water recycling to meet needs.

Instinct tells us that it’s correct to give priority to people and agriculture to the supply of water over industry. But it clouds the issue of government’s inability to manage the provision of water efficiently, and how lack of investment in state-run infrastructure has led to the supply problem and why local government now create barriers for its use by industry.

Converting water into a tradable commodity will result in it being managed more efficiently as a resource. The misuse and over exploitation of the past would be prevented by assigning it a value.

This thinking prompted Fortune magazine to describe water as the commodity that will determine the wealth of nations in the 21st century, in the same way that oil did in the 20th century.

The counter-argument to treating water as a commodity is that it’s a basic human right, and the fear that the world’s poor stand to become worse off as social equality will traded in for economic efficiency.

Trading water rights is already happening in Australia, and to a lesser extent in the western US. The more this happens, the more it becomes accepted and eventually becomes part of the mainstream.

GOVERNMENTS WILL STRUGGLE TO MEET FUTURE DEMAND

The need for fresh, clean water will only increase – by 2050, 55% more water will be needed than supplied today –  and government are unlikely to be able to meet that demand because of the massive investment needed to improve supply management.

Markets can play an important role in providing future water security by helping to fund improvement to water infrastructure. The creation of a futures market to trade water would help to create a baseline pricing mechanism against which regional water tariffs could be fairly set.

There is another fear that water scarcity could eventually see water-rich countries (Brazil, Russia, the US and Canada) form into a group similar to the Organisation of Petroleum Exporting Countries (Opec) despite the current transportation issues inherent in moving water.  But if serious investment isn’t made into infrastructure – $22 trillion over the next 20 years to maintain current supply levels according to some estimates – then the problem of water shortage will become even more acute.