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Next Triumph Scalper Trading Software. This is crucial, so you begin to create consistent and repeatable results in your trading. Another thing to keep in mind with technical analysis is that you will not win all of your trades. The goal is to have a system that can handle losses, but it consistently makes you money at the end of the month. Moving averages are one of the most popular indicators in the world for technical analysis.

You can use moving averages for smoothing out the overall price action to find clear trends and dynamic support and resistance. When you combine multiple moving averages on your chart, you can also find high-quality trade signals. At its simplest, the moving average shows you the overall price for a certain period of time.

For example, if using period moving averages, then you will see the average price for the last 14 periods plotted as a line on your chart. This can show you the overall direction price has been moving in on that time frame. The MACD is another hugely popular indicator used in many different markets by technical analysis traders. The Fibonacci tool is an indicator you can use to both make and manage your trades.

Fibonacci is formed with a set of key ratio numbers that includ e Now pay attention to the question. Can you teach me how to trade on the Forex and make money? Do you know what that is? I will kill you. The best way to learn something and remember it is to teach it to some- one else, so after I teach a concept for about 45 minutes, I instruct the class to teach each other. I have the person on the right teach the concept to the person on their left, and after they are done I have the person on the left teach the concept to the person on their right.

Little did I realize this teaching technique would potentially save my life. When I divided the class into pairs that day, I believe God protected me by having an odd number of students.

Looking back, I must say that was one of the most detailed, and perhaps one of the best, classes I have ever given. I am happy to report that both Ian and I are still alive. In fact, Ian is now an active client of ours and has taught me a lot in return.

Two of the greatest things he taught me were how to perform under pressure and, more importantly, how to keep things simple with respect to teaching Forex trading.

For example, at one point, Ian could only recognize and understand uptrends. They have to move in opposite directions to keep the world economy in balance.

He keeps his trading simple. But the Bretton- Woods Accord of , which was established to stabilize the global econ- omy after World War II, is generally accepted as the original beginning of the foreign exchange market. Currencies from around the world were fixed to the U. All currencies were allowed to fluctuate around that value but only within a narrow trading range. In , the accord finally failed, however, it did manage to stabi- lize major economies of the world, including those of America, Europe, and Asia.

All other weaker economic currencies are then fixed against the USD and allowed to fluctuate, or float, no more than 1 percent on either side of the fixed rate. If the fixed rate moved more than 1 percent, the central bank of that country was required to intervene in the market until the exchange rate was brought back to within the 1 percent band. The Smithsonian Agreement and the European Joint Float agreement were similar to the Bretton-Woods Accord but allowed a greater range of fluctuation in the currency values and widened the band in which curren- cies were allowed to trade.

The Smithsonian Agreement was just a modification of the Bretton- Woods Accord, with allowances for greater fluctuation, whereas the European Agreement aimed to reduce the dependence of European currencies on the U. The free-floating system managed to continue for several years after the mandate, yet many countries with weaker currency values incurred major economic devaluation against certain countries that had stronger currency values.

But by , it was clear that this European Monetary System had failed. Shortly thereafter, retail currency trading opportunities as we know them today started to be enjoyed by smaller investors willing to take similar risks as that of banks and large financial institutions. The devaluation of currencies continued in the Asian currency markets, and confidence in trading the open Asian Forex markets began to fail. However, countries with stable currencies, and the concept of trading currencies, remained unchanged.

The establishment of the European Union in gave birth to the euro seven years later in The euro was the first single currency used as legal tender for the member states of the European Union and became the first currency to rival the historical leaders—the United States, Great Britain, and Japan—in the foreign exchange market by providing financial stability that Europe and the Forex market had long desired.

Forex is an acronym for foreign exchange, a market where people exchange the currency of one country for the currency of another in order to do busi- ness internationally.

Typical situations in which such currency exchange is necessary include payments of import and export purchases and the sale of goods or services between countries. Forex is also called the cash market or spot interbank market. The spot market means trading on-the-spot, at what- ever the price is at that moment. Prior to , the Forex retail interbank market for small individual speculative investors or traders was not available.

A speculative investor, or speculative trader, is one who looks to make a profit on price movement in the market and is not looking to hold onto any currency long-term. Then in the late s, retail market maker brokers companies that facilitate the trades for speculative traders were allowed to break up the large interbank units and offered individual traders the opportunity to participate in the Forex market as we know it today.

The term market refers to a place where buyers and sellers are brought together to execute trading transactions. Forex trades nearly four times that volume daily, exceeding the daily combined activity of all the other financial markets. Forex has no physical location—transactions are placed via the Inter- net or telephone—but is composed of approximately 4, international world banks and retail brokers.

Individual traders wanting to profit by speculating on price changes can only access this market through a Forex broker, such as I-TradeFX. It is a good practice of a speculative trader to only deal with Forex brokers that are regulated by the governmental bodies in their respective countries.

That is the main difference between trading currencies and stock trading—you always have to deal with two instruments, or currency pairs, whereas in stock trading you only deal with one instrument. The definition of a currency pair, or currency cross, is trading one currency for another currency, and you need a currency pair to execute a trade on the Forex. Speculative currency trading, just like speculative stock trading, involves exchanging one currency for another in anticipation of a price change in your favor.

There are two types of traders on the Forex: consumer traders and spec- ulative traders. A consumer trader wants long-term ownership and is not as concerned with daily price movements, whereas a speculative trader is only concerned with daily price movement, as that is where the profit potential is.

Speculative traders are also called scalpers—they are trying to scalp a profit in a small price movement. Long-term position traders enter the mar- ket and stay in for a week, a month, or years. Short-term, or day traders, will enter the market for 5 minutes, 30 minutes, or even 4 hours, and then exit, but they are usually in and out within a hour period.

Although brokers will assure you that Forex trading is commission- free, it is important that you understand there still are costs involved. The spread is the difference between the buy price and the sell price of a specific currency. Envision attending an auction where there are several buyers for a partic- ular item. As bidding gets closer to the asking price, the spread tightens up.

There are spreads between all currency pairs that are traded, and they average 3 to 6 price interest points, or pips, on the major world currencies which are considered to be the U.

Currencies from small countries are called off-brand currencies and can have spreads as much as to 1, pips. The broker retains the spread, which is the difference between the buy and the sell price. To break even, the market would need to move up 4 pips in your direction. To make a profit, the market would need to move more than 4 pips in your direction. Price interest points, commonly known as pips, are usually expressed in decimals.

Depending on the pair of currencies being traded, pips are usu- ally the last numbers of the decimal. Most traders on the Forex trade with what is called leverage. When a trader executes a trade on the Forex, the trader is buying or selling currency in units referred to as lots which is a set quantity of money. There are typically two types of lots that traders will trade. You will see that the currency moved in our favor to 1. Trading can be a worthy full-time profession or a great way to earn sec- ondary income.

Either way, you will need to learn the three basic skills of trading as you watch price movement against time. How to determine the current trend on any time frame 2. How to develop an entry strategy that works consistently 3. How to develop an exit strategy that works consistently Once you master these three skills, you will be in a position to take advantage of the significant profit potential in this market.

After you open a trading account, the broker gives a trader the right to execute transactions, which includes certain rights and privileges, including the right to be a bull or a bear. The terms bull and bear were created by traders in the stock market in the early s to identify the direction someone was trading in the market. The term bull was derived from the way in which bulls attack or charge, moving upward.

In contrast, bears move downward when they attack or charge. Bulls, therefore, resemble a buying market, because they believe prices will continue to move upward, or rise, whereas bears resemble a selling market, because they believe prices are going move downward, or fall.

Every trader has to make a decision to be either a bull or a bear before entering the market. Bulls enter the market buying first and exit selling second.

Bears do the opposite: they enter selling first and exit buying second. To make a profit in the market, you must always buy low and sell high. Both bulls and bears are trying to do that; bears just reverse the transactions see Figure Remember, there is a bid price and an ask price with a 3- to 6-pip spread on the major currencies the U. Traders buy on the ask price and sell on the bid price. If you want to enter buying, you would pay the ask price of 1.

You can enter and exit the market using a limit order, which are orders placed ahead of time to enter the market buying below where current prices are or selling above where the current prices are. They are placed like a limit order at a predetermined price; however, they turn into market orders when the market reaches the predetermined price and may be subjected to slippage.

The rule is, when you place a buy order above the current market price it is called a stop order, and when you place a sell order below where the current price is it is also called a stop order.

Every trade should have an entry point, a predetermined exit point for profit, and a well-thought-out exit point for minimal loss should the market not go your way.

The rule is, every buy order should have two sells: a sell limit order for profit and a sell stop order for loss protection. Conversely, every sell order should have two buy orders: a buy limit order for profit and a buy stop order for loss protection. Some trading software programs allow the trader the ability to place an OCO one cancels the other order.

This means the moment the market hits either the stop order or the sell order, it cancels the opposite order. By trading with an OCO order, you are not left exposed with a working order after either your stop or limit has been filled and you have been taken out of the market. An OCO order offers you the opportunity to set a trade and forget about it. You can literally walk away from your computer and not be concerned with catastrophic results if you have properly quantified your potential losses before you placed the trade.

No one knows where the next pip will go, so the best you can do is plan your trade and trade your plan. One of the most important and productive habits you can adopt is properly educating yourself about the Forex before you begin trading.

If you move forward without the proper education, be prepared to lose your money, much like in a casino. Just like the casino, the market will be there to take all your money. I have learned that to achieve success in trading requires learning to understand the three critical facets of trading: 1. The technical education and trading knowledge 2. The fundamental understanding of what determines market movement 3. All successful traders learn that working through frustration is the path to success.

Knowing what to do when you get frustrated is critical. Strong people make as many mistakes as weak people. The difference is that strong people admit their mistakes, laugh at them, and learn from them, and that is how they become strong.

Mistakes are part of being human. We need to appreciate our mistakes for what they are. Before you begin trading, you need to create your own mission state- ment to help you focus on becoming an educated, financially successful, long-term Forex trader.

I want you to think of your journey toward becom- ing a successful trader as a transformation of thought, a new process of knowledge build-up, followed by: 1. Disciplined thought 2. Disciplined rules 3. Practice first on a demo account to become comfortable with the trading platform before trading with real money.

You begin to trade with real money, work through your emotions, and learn to trade within the equity manage- ment rules to achieve a consistent financial return.

You mechanically execute profitable trades with no emotion. More than 90 percent of all traders who attempt to become successful on the Forex fail. Our professional international team at Market Traders Institute adamantly believes in proper education first.

Knowledge is the key that can make a big difference in the success of a trader, providing a necessary edge. I cannot stress this enough: the majority of the world is locked into managing its poverty or mediocrity.

Very few people learn how to manage any kind of success because they are not given any sort of manual or instruction guide to success.

Growing up, we learn how to survive finan- cially from our caregivers and circles of influence. But not all mentors are successful, leaving many to learn through trial and error. Thousands of books have been written on how to achieve some sort of success. I believe that success comes from acquiring the right education about the opportunity; possessing the right work ethic; implementing the right productive daily habits; and believing with focus, concentration, action, and a positive attitude that your dream will come true.

Successful people keep things simple. They find beauty in simplicity. The average per- son, for some reason, tries very hard to complicate things, even the simplest processes or procedures. I, on the other hand, have worked hard to take a very complicated issue, Forex, and simplify it, enabling just about anyone to understand how the markets work and how to trade them.

During the next 18 days, it continues the loss of information until it settles at 3 percent retention of the new information. Our focus at MTI is to provide you with productive practical, continued education, enabling you to be trading with percent-plus recall. You must practice them over and over again until they become an unconscious habit.

Doctors prac- tice on cadavers first. Pilots fly with instructors long before they go solo. I personally believe that self-empowerment is learning how to fish and that dependency is all about being handed a fish to stay alive.

Make no mistake, there is no holy grail! You cannot buy any indicator or trading system that works percent of the time any more than the airlines can buy an autopilot system that eliminates the need for pilots. I would think not, because if you could create such a trading system, all you would need to do is walk into any major financial institution like the Bank of America or the Royal Bank of Scotland and show proof that your auto- mated system works.

Just as there is no perfect trading system, there is no autopilot sys- tem that works without a pilot. I very much doubt that human beings will ever put their lives on the line with a computer or autopilot system in an airplane without a pilot.

We all have bought enough electronic equip- ment in our lives—TVs, VCRs, cameras, and so forth—to know they all fail eventually. Pilots are educated and trained to fly proficiently before they are even shown where the autopilot system button is. The first time I got into the cockpit with my instructor I asked him where the autopilot button was. I did eventually learn how to engage the autopilot function and will have to say, the autopilot system is not a fail-safe function without the close moni- toring of a pilot.

As powerful as such systems are, when things start to go wrong, they cannot make spilt-second decisions in the best interest of the passengers.

They can only do what they are programmed to do, and there are too many variables in flying to program absolutely everything. Autopilot systems do not work percent of the time, they have their limitations. As a trader, you will learn that, from time to time, the trading environ- ment will be ideal enough to use an autopilot system.

That is truly suc- cessful trading. I was sitting in my office at home and had been in a few trading positions for a couple of days on four different currencies. All of a sudden, they all took off like rockets in the opposite direction of my positions. Thank goodness I was not using an auto- pilot trading system or I could have been financially wiped out that day. I was stopped out on all four currencies and was able to preserve what profit I had made.

The reality is that to become a successful trader, you must go through an education process no different than that of becoming a pilot, a physician, or of any profession that requires a specific discipline to be mastered. I am even more amazed at the massive amounts of people willing to purchase these products. But I am never surprised when they call our office and share their experience of buying a Forex program that failed or disappointed them.

These traders are now pleading for help because with their current system, they keep on losing money and have no idea how to make it back.

A fair question is, did the system truly fail or was it the system found between their ears that failed? You must be taught how to use the best tools available for whatever profession you want to pursue. If you are going to be a ditch digger, you need to be taught how to use a backhoe as well as a shovel and be taught in which situations one or the other should be used.

Learning to trade on Forex, from someone who is already successful at trading, is critical. Finding out which trading tools they use is equally important. Now is not the time to go bargain hunting for tools. Bargain hunting for free or low-cost trading tools is like learning to navigate on the ocean with a compass in a foot canoe—clearly the wrong vessel for the environment. A solid built, 1,foot, state-of-the-art cruise ship with all the latest gauges for weather would be wiser.

With so much at stake, do not take a shortcut on paying for quality trading tools. These systems can be back-tested over many years instantaneously, allowing a trader to see if their trading strategy is a good one, or if they are working in the wrong direction.

You can create a trading strategy that aligns with your personality, program it into a system, back-test it, and, if it is productive, have the trading system send you alerts via e-mail or cell phone when an entry and or exit signal is triggered see Figure The most important part about a trading system is that it must be simple and easy to use. Whether it is done visually or created by a trading system, your trading strategy must have three very important components: 1.

It must be able to find the current market direction. It must have a consistent entry strategy that works consistently. It must have two very clear exit strategies, one for protecting you against major losses and one for capturing a profit. In Figure , you can see a line that goes above and below the price movement against time that is monitored by a computer creating a candlestick formation candlestick formations are a way of monitoring the open, high, low, and close market prices in any given time period.

This line is called a moving trend line; a visual indicator of market direction or perhaps the current trend. When you turn on your computer and begin to review your charts on any time frame, if the current candle is above that line, the market on that time frame is in a potential uptrend, and if the current candle is below that line, the mar- ket on that time frame is in a potential downtrend.

No matter what time frame you trade in, this simple exercise accompa- nied with this system can help you determine trend direction. Before you use an autopilot program, you need to understand how it has been programmed. Looking at the moving trend line, on any time frame, can help you deter- mine market direction on that time frame. One mistake traders often make is believing that a trading system created for a minute chart will work on all time frames, such as a one-hour chart or a daily chart.

Sometimes it does work, but typically, as you move a trading system from one time frame to another, you may want to adjust the settings of such a system to optimize its performance on that time frame.

It is vital to find trading software that will not only allow you to change these settings but also instantaneously back-test the results as found incorporated in MTI 4.

Every trader wants the market to move in his or her direction from entry—there is nothing worse than get- ting in a trade and having the market run in the opposite direction. One of the most important traits of a successful person is that when they are trying to make a productive, empowered decision, they gather facts.

The more facts they can gather, the more informed their decision. Trading is 10 percent skill and 90 percent emotion, which is why our emotions frequently stand in the way of making good decisions. Anytime you need to make a decision, do yourself a favor and do not make it while you are in an emotional state. Take the time to calm down and place your- self in a logical state of mind. If you do that, you will open up the left side of your brain, where all your knowledge is stored, where all your intellec- tual recall is, and you will have access to everything you have learned in your past that is productive.

You will begin to make an educated, positive, and productive decision. Trading indicators can keep you from using the right side of your brain, where all your emotions are stored. You can program buy and sell signals that have no emotion, they just monitor price movement against time. Using different indicators together can create effective entry points, like the ones found in Figure , but they need to be manually monitored.

The two moving lines overlapping the candles are moving trend lines, which can act as buy and sell signals. The line closest to the candles is a moving inner trend line and the other one is a moving outer trend line.

In Figure top , you can see that if you used the moving trend lines as your entry and exit signals, right around March 10, , you would have bought the euro at approximately 1. But where do you get in if the moving trend lines have already crossed?

Do you have to sit there for another three to six months before they cross over again to find another trading opportunity? The answer is no. You can have two options. You either educate yourself how the markets move without using indicators or you learn to add additional indicators to your trading system like the waving line you see at the bottom of the chart in Figure As the market moves, it resembles the waves of the ocean.

The greatest part about a trading system is that it is constantly moni- toring the movement of the market, projecting directions with entry and exit points 24 hours a day even while you sleep or work. Using a trading system allows you to control your trading in the market, rather than the market controlling you, and to come and go, or turn off your computer, without having to do all kinds of new technical analysis of the market to catch up from where you left off.

If the lines overlapping the candles crossed while you were away, the MTI Trend Tracker allows you to enter the market at a price point where the market will more than likely reverse and rally back up in your buying direc- tion from entry, which is what every trader wants.

When the moving line is going south and then U-turns to the north, the market should follow. Look at the price movement of the market and how it began to rally again. This trading system works just as effectively in a downtrend as it does in an uptrend, as you can see in Figure All the rules are the same but in the opposite direction.

When the lines overlapping the candles cross from the north to the south, it is time to sell. Once again, if you turn on your charts and the mov- ing trendlines have already crossed, giving a short signal, you can enter when the MTI Trend Tracker indicator moving north U-turns to the south.

Look at the market movement on the charts after the U-turn toward the south. Using trading indicators eliminates a lot of the guessing and allows you to focus on developing a trading strategy that works consistently, on a time frame that suits your personality. Some traders like fast action and want to turn their computer into a video game—they want to quickly scalp the market. In and out, in and out, perhaps 10 times a day. If you enjoy day trading, use this trading system on one-hour to four-hour time frames, and if you enjoy long-term trading, use this trading system on four-hour, daily, or weekly charts In any of these cases, you let the computer do the majority of the work.

Just like an autopilot system. If it were that easy, however, we would all be living in gated communities and flying our jets to our beach-house estates every weekend. Most traders make their money during trends and lose it when the market gets turbulent or begins to go sideways. What if you were just starting out and the market began to go sideways, or consolidate, as shown in Figure Just about every time the computer gave a buy signal, the market went south, and just about every time the computer gave a sell signal, the market reversed and went north.

When most people board an airplane and look inside the cockpit, they are intimidated by all the gauges they see.

How do I know? Just like when I turned on my computer back in the s and looked at charts, I, too, was extremely intimidated. But believe it or not, sideways movement can potentially offer the trader more trading opportunities than trends.

Envision buying all the lows as seen in Figure and exiting at the highs and then reversing your position, shorting the market by selling all the highs taking a ride across the trading channel and exiting at the lows. It is clear to see by continually repeating this process that there is profit to be made. Conversely, when going short or selling first to enter the market, every sell entry order needs two buy exit orders, one for profit and one for loss.

After you enter the market, you need the two exit points, one for profit and one for financial protection should the trade not work out. The fact of the mat- ter is that no one knows where the next pip will go. The best you can do is to understand how the market works and learn how to go with it. But success comes to those who understand how it works—just look at the people who have been able to create great compa- nies that haul freight, passengers, or oil over the ocean. After the market has moved in your direction from entry, as planned, the question is where do you get out?

The last thing in the world you want to do is guess what the market is going to do next. Note: J. Preston Eby, in order to continue to devote his full energy to writing no longer works in the office and does not receive this email. He does, however, respond to any urgent correspondence via snail mail postal mail.

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