2Bull Forex Blog

There are countless of Forex day trading systems available online for retail traders to follow. Unfortunately, most of them are either simply ineffective, or are downright scams.

Selecting a reliable online Forex trading system is not an easy task. In this article, I will briefly discuss two main issues you should consider when looking to purchase your own trading system.

Issue 1: What’s the biggest drawdown?

It’s not difficult to make tons of money in Forex trading. A blindfolded monkey can probably do that. What’s tough is making lots of money, AND managing to keep it.

Be careful of Forex “systems” with unrealistic propositions that claim to consistently make 300 or more pips a day. Pay attention to the biggest losses that the “system” suffers from. A system that makes you 300 pips a day could very well lose you 500 pips in the next!

All reliable trading systems will have relatively low drawdown figures. You can’t be a profitable trader if your losses are too large. Remember, even if a “trading system” enjoys a high-winning probability, it can still be an overall losing system if the losses are large enough.

Issue 2: Is the track record of the system simulated?

Even systems with the ‘best’ track records are essentially useless if the track records are simulated.

Simulated track records are easy to ‘manufacture’, since everyone already knows what has happened in the past. For example, if I know that the EUR/USD currency pair shot up 300 pips yesterday, it would be easy for me to come up with a ‘trading system’ that can make me 300 pips in only 1 day… I just have to test it using yesterday’s data!

The true acid test for a profitable system would be to test it using live market data. So try and look for a real track record for any trading system before purchasing one.

The currency market is particularly sensitive to market news, such as the non-farm payroll data announcement. Volatility during these periods of news announcements is notoriously high, and fortunes are literally made and lost in a short time span of a few minutes.

With these characteristics, it’s no wonder that many retail Forex traders pay extra attention to the latest daily news updates… their trading account depends on it!

Who Are News Traders?

News traders are people who trade exclusively on economic news announcements. Their aim is to make the most profit in the shortest time possible. It’s not unusual to have a market movement of a hundred pips of more, just 5 minutes after the news is announced.

News trading is a highly risky style of Forex trading, and is generally not recommended for novice traders. Amateurs who think news trading is a way to make easy money are often taught an expensive lesson by the market.

What If I Don’t Want To Trade The News?

For those who do not wish to trade the news, they often wonder if they should pay attention to the daily market news at all.

In my humble opinion, the answer is generally ‘no’.

The fundamental daily news is usually slowly incorporated into the market price, so a competent technical trader will already be able to take into account any unusual changes in price action.

However, there are of course exceptions to this rule of thumb.

While you probably don’t need to pay a lot of attention to the every-day news announcements, there are some economic news data release dates that you should avoid trading in.

These are the same economic news announcements that the news traders trade on. Some examples include the non-farm payroll, ISM manufacturing and FOMC meeting announcements.

The high price volatility experienced during these periods are best avoided by most traders… it’s better to keep your capital protected than to risk it on highly risky trades.

Day trading online systems are probably the most common introduction for novice traders in forex stocks and commodities and there are plenty of day trading systems for sale lets look at them, the best ones and how they can make regular profits…

Day trading systems online offer a simple solution all you do is buy a ready made package and simply follow the trading signals. There are many systems that have outstanding track records which we will look at next.

The first point to keep in mind when looking at day trading systems is - to understand that most have never been traded in the market. There unproven, as all the gains are simulated in hindsight and that’s easy! If you see a track record of profits, chances are it will carry this warning from the vendor - here it is:

“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“.

Now you may be thinking that if the system is so good then why has it never been traded? You’d to Right!

The fact is anyone can make money when they know the closing data - but that’s not the real world of trading and you don’t have the luxury of hindsight.

The reason these systems have never been traded is simple - they don’t work and of course if you think about it, its pretty obvious, as if the systems were so good the vendors would need to share them with you for a few hundred dollars!

Most day trading systems online are not sold by traders but by marketing companies, looking to make money by using clever copy, a simulated track record and appealing to greedy or naïve traders. These traders lose all their money in the market and the vendor makes a guaranteed profit.

You may say there must be some day trading systems that make money?

Well, try and find one; I have been looking for 5 years and never found one yet!

The reason you won’t find a long term track record of gains is simple - day trading doesn’t work longer term, as all short term volatility is random, you can’t get the odds in your favor and you can’t win.

If you think about it, there are millions of forex traders who make the price and you cannot judge what this mass, diverse group of people, are going to do in just a few hours - it’s impossible.

If you want to win at forex trading (or in any other trading medium) forget day trading and forex scalping systems and base your forex trading strategy on longer term data, where you can get the odds in your favour.

Forex trading offers you a great opportunity to make money and you can win - but you won’t if you use day trading systems online, which are sold with simulated track records. So look longer term, trade the odds and enjoy forex trading success.

In Forex trading age is no barrier and many men and women are enjoying a lucrative income in retirement and you can to. This article is all about seniors and forex trading and how to get started. The advice however applies to all, as age is no barrier.

If your mind is still fresh and you enjoy a challenge, then there is no reason even if you are in your eighties or nineties, you can’t enjoy forex trading success.

The reason I wrote this article on seniors and forex trading was, one of the most successful forex traders I know is a lady of 83 and she’s very good at it!

She was looking to make some extra money and have some fun and that’s what she’s doing and doing it well.

So how do you get started at forex trading online?

Getting the right Education

The first point to keep in mind is to get the right forex education and you don’t have to pay for it.

There are many free sources online which will give you excellent forex education and help your learn forex trading the right way.

Success is down to You

A word of warning don’t believe the copy of any of the automatic robots that claim they will give you success with no effort - your old enough to know that life is not like that and success comes from your effort.

There is no free lunch in forex trading just as there is no free lunch in life but you can easily learn a forex trading system that will be successful and make you longer term profits.

Once you have learned your trading system executing your trading signals should take no longer than 30 minutes a day.

Use forex Charts

The simplest most time efficient way of trading forex is to rely on forex technical analysis and use forex charts.

If you can spot repetitive price patterns on a graph, then you can make money.

The logic behind forex charts is simple, compelling and makes money and simply is:

All prices are decided by traders while we all have the same facts to look at we make different subjective judgements on what they mean. This means its humans that determine the price of anything - the facts are unimportant, it’s how we as a mass of traders see them that’s important.

As human psychology is constant and never changes, human nature repeats itself in a number of high odds chart patterns, which can be traded for profit.

If you use forex technical analysis, you don’t care why prices move, you just want to make profits from them when they do!

Once you have your forex trading system and you are ready to trade it only should take you about 30 minutes per day to execute it and it only needs to be a simple trading system.

Simple systems work best, as they are easy to understand, easy to apply and very robust - complicated systems have to many elements to break so keep it simple!

So there you have it a brief introduction to forex trading for seniors - if you have some risk capital and want a fun and exciting way to make big profits.

No other financial market is as exciting or as fast-paced as the foreign exchange market. The high volatility promises literally instant wealth if you manage to play your cards right. This inevitably draws new traders every day who wish to try their hand at speculative currency trading… The adrenaline rush of watching a wining trade unfold before one’s eyes is simply irresistible.

And in this quest of seeking out maximum profits, many investors often try to find the ‘best trading system’ to trade with. After a while however, these investors start to realize that they have underestimated the speed and complexity of the market price action. Perhaps they were not profitable with their demo trading account, or maybe they lost an embarrassing chunk of money during live trading. Either way, they start wondering whether they’re doing the right thing by always looking out for a ‘better system’ to trade with.

They start to ask, “Should I keep looking for a better trading system, or do I just need a better understanding of the Forex market?”

In truth, they may be surprised to find out that the answer is: “Both.”

Allow me to briefly explain…

You see, these two paths are actually interlinked. The more you understand about the Forex market, the better your chances of choosing a trading system that suits you. In other words, the less you understand about currency trading, the higher your chance of choosing the wrong trading system to follow.

There is no single, ‘ultimate’ trading system for everyone. However, don’t despair! There is definitely an excellent trading system that is catered especially for YOU.

It’s not the system that defines how well a trader performs… Rather, it’s the other way around! It’s actually the trader who defines the type of system he/she uses! How well a trader performs is actually a reflection of the appropriateness of his choice of trading system.