2Bull Forex Blog

There are many vendors who sell currency trading signals and traders can then use them to make forex profits without having to study the market and of course you can get software to do the same. Let’s look at the best ways to get superior forex timing with these signals.

The first point to keep in mind is - there are a lot of people who will try and sell you currency trading signals and their not traders, their simply marketing organizations and have no trading experience.

To avoid these people and to find out if a forex signal trading service or forex trading system can generate trades that are likely to make you money, look for the disclaimer below - if a vendor uses it or similar one, don’t buy the system.

Here it is read it carefully:

“CFTC Rule 4.41 - hypothetical or simulated performance results have certain limitations. unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown”.

The one above is a standard CFTC one and it effectively allows anyone to make up a track record in hindsight - knowing the closing prices.

Anyone can do that, even a child - but forex trading is not so simple, we have to trade going forward.

Look for real time track records and get verification.

Even if you are lucky enough to find a forex signal trading service that has a real time track record - you must understand the logic it is based on, otherwise you won’t be able to follow the signals with discipline.

If you don’t have confidence in the logic and the discipline to follow the signals through losing periods (and you will have them) you don’t have a system!

The traders who buy currency trading signal services, are normally traders who are greedy and looking for a fast buck - or traders who are simply naïve. They end up disappointed and lose their money, because there is no easy money to be made in forex markets.

Of course, you wouldn’t expect there to be, with the profits to be made.

THE BEST WAY…

To enjoy currency trading success is to generate your own currency trading signals, by learning forex trading and building your own system which you can be confident in and you can apply with discipline.

While this may sound daunting - its not and you can do it in a couple of weeks, if you work smart and get the right forex education.

Currency trading success is based upon understanding confidence and discipline and the best and most profitable path is to generate your currency trading signals.

If you have the desire to succeed and a willingness to learn you can do it.

ICWR stands for Impulsive/Corrective Wave Retracement. The ICWR forex method is a set of rules that traders use to determine when to enter and exit the forex market.

The ICWR forex method is based on a mix of the Elliott Wave Theory and Fibonacci ratios. Traders have discovered that corrective waves have a predisposition to retrace the preceding impulsive waves by a Fibonacci ratio.

So what are corrective waves? Corrective waves are short-term corrections that go against the long-term market direction. The major waves in in alignment with the long-term market are called impulsive waves. Bring up a chart of any major currency (say the GBP/USD) with the interval set on daily and you will easily see the long-term direction, along with several corrective waves.

The most recurring Fibonacci ratios observed in the ICWR forex method are 25%, 38%, 50%, 61% and 75%.

Many traders use the ICWR forex method with an existing entry method to help refine their exit strategy to take out the most gain possible from the trade. Many traders have discovered that managing a trade and determining the time to exit is even more important than selecting an entry point and direction to trade in.

The ICWR forex method is very easy to use. Simply bring up a chart of a time frame you wish to trade, find the preceding impulsive wave (in the direction of the long-term direction) and compute the Fibonacci ratios. Now mark the Fibonacci ratios on your chart. For example if the preceding impulsive wave UP was 100 pips, for the Fibonacci ratio of 25% you will place a line 25 pips below the top of the impulsive wave. Many charting packages come with a Fibonacci function built in, calculating the ratios and marking the lines for you.

These Fibonacci levels can then be put to use in several ways:

- go your stop loss with each impulsive wave in your favor to maximize gain and minimize risk (the 75% ratio is usually used for this)

- estimate when the corrective wave is probable to conclude in order to estimate good entry points.

Many traders tend to worry when their trade is in gain and it begins to go against them. By using the ICWR forex method you will be better prepared to ride out the corrective waves in order to take out the most gain from your trades.

There are many misconceptions about forex brokers, many people think they should be seen as friends, others think their just a necessary evil - but their neither. Lets look at selecting a forex broker and what you need to look for in terms of services.

So why do people think forex brokers are to be seen as the enemy?

You get a lot of traders who think brokers pick stops and these are mostly involved in day trading and the fact is their logic is flawed and their stops are to close.

A broker doesn’t need to pick off stops as these traders lose anyway as the odds are not in favor of day traders.

Others seek advice from their brokers - why?

If brokers could make money trading they wouldn’t be brokers!

Never ever fall for the idea of having a broker assist you with your trades, you need to do this yourself and take responsibility for your actions.

3 Essential Points to Consider

You’re only interested in 3 main points.

1. Forget the Words: Commission Free - You Pay!

You pay a broker in the pip spread - this is your cost of doing business.

Make sure you pay no more than 2 - 3 pips on the major currencies and if you shop around, you will find brokers offering these spreads.

2. Security

Don’t trade with small or new brokers. Make sure you broker is stable, been in business for a while and has the facility to offer 24 hour trading and of course support, should you run into technical problems.

3. Trading Platform

This is your gateway to the forex market place and it needs to be reliable and easy to use. Today, most of the big brokers offer great trading platforms.

You can almost always test drive them with a forex demo account - so do this until you are comfortable with it.

Other Considerations Are:

4. How quickly you can fund your account?

Do they offer credit card facilities and how quickly can you withdraw.

5. Leverage

Most brokers offer more than enough leverage and you can easily get 100:1 (which is way more than enough for most traders) but you can get up to 400:1. A word of caution - don’t use to much leverage it’s the reason most novice forex traders wipe themselves out.

6. Other Extras

Many brokers will offer you free technical tools, books etc and some are useful some are not but that’s down to individual preference and should not be a major consideration in opening an online forex trading account.

A Great New Service!

All brokers will offer you a forex demo account to test your trading skills but there is a new service that’s great for novice forex traders and it’s called a protected account.

Demo accounts show you the basics - however there is no money on the line.

Protected accounts are different - they allow you to get a feel for trading with real money and limited risk.

In essence they allow you to put down a small deposit and trade as much as you wish in a period of a few weeks - even if you are in debit. At the end of the period:

- You take the profits
- The broker takes the loss

These accounts are a great bridge to real time trading, as they allow you to do lot of trades if you wish to and have limited risk.

So there you have it. Forex brokers are essential when trading, you can’t do without them and their neither friend or foe, just your gateway to the worlds most exciting investment.

Follow the tips above and you will soon find one a forex broker you are happy to work with.

More new forex traders try forex scalping methods or day trading than any other methodology. This article is all about the facts you need to know so lets get started on our forex scalping for beginners review of the basics.

The first and most important point is - it doesn’t work!

You will see lots of vendors on the net try and entice you with great copy and track records which look just too good to be true and they are - Why?

Because none of them have been traded in real time - all are simulated in hindsight KNOWING the closing prices. If you look at the disclaimer you will see the one below (standard CFTC) or similar - read it carefully:

“CFTC RULE 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown”.

Put this disclaimer of a forex scalping system and you can say anything you like and make up any track record you like - it’s as simple as that.

Forex scalping or day trading is a good story but that’s all it is - it won’t make you money,because the underlying logic is flawed.

Consider this:

You have millions of people trading trillions of dollars and to try and say what this vast group of people all with different investment objectives and subject to their emotions will do in a few hours is rubbish.

Traders are not logical and price volatility in a day or a few hours is totally random.

Trying to base your forex trading strategy on trying to find order in these short periods is simply doomed to failure.

Volatility is daily time periods is random -you can’t get the odds on your side because support and resistance levels wont help you and you may as well base your trading and marketing timing on flipping a coin.

Don’t believe me?

Try and find a forex scalping or day trading system with a real long term track record of profits and you won’t find one - if you do let me know I have been looking for over 5 years.

If you want to win at forex trading and enjoy currency trading success you need to use longer time periods that will allow you to get the odds on your side with your forex trading system and that means forex swing trading or long term trend following.

This will allow you to trade the odds and enjoy forex success long term.

Today, traders are looking for easy ways to make money and of course there are none and you wouldn’t expect there to be with the profits you can make - but if you work smart and get a system that can help you execute your forex trading signal in line with the odds and you can win.

So their you have it - our view of forex scalping for beginners and our view is don’t try it, or you will lose all your money quickly.