Have Guts Will Travel...!

Forex - The market that never sleeps. Trade for profits eternally!

Why Trade Forex?

FOREX is the largest and most lucrative market in the world, offering you never-ending opportunities. Forex trading is the simultaneous buying of one currency and the selling of another. It is an art rather than science, the perfection for which comes with farsightedness, and the willingness to learn through frustration, patience and sheer guts. Your skill gets honed through thick and thin of actual trading and continuous learning. It must be treated as a real business, such that the essential rules are appropriately applied. My belief - It gives one a fighting chance... that of being able to make money 24/5 - that's day and night from Monday to Friday - from a marketplace that is said to be more than USD5 trillion per day (by current estimate). You have the opportunity to profit when a currency pair moves in either direction, as opposed to stocks where you want prices to go up in order to profit. Whether you are young or old, for as long as you can click the mouse, this market 'can' be for you. Truly, it 'CAN' be for you... all that is required is your want and a little bit of guts! Life, anyway, is simply too short for us to be scared...


Be aware of this, though: Between traders, the Forex market is a zero-sum game where winnings and losses equalise to nil at the end of each trading session. As surely as the sun rises and sets - you will sometimes win and sometimes lose; that's inevitable and fair, I suppose. It happens to the best of the best! The object, of course, is to be among those who are smiling in the 'winners corner' come accounting day (the period for which is entirely up to you)! This suggests that today's profits and losses do not count at all... a good life for the trader comes with consistent profits over time. That brings us to the need for proper education in order to achieve that goal. We will get to such a stage; it's just a matter of how strongly we want it. Hey, who ever was born with Forex trading in his mouth?!


If by now you have been tickled by this Forex thing but have no clue what, why and how, I would suggest the School of Pipsology  as a platform for good and fun way of learning!


Entering the Forex business...

You will need a Forex Broker as an intermediary to the Forex market. It provides you with a trading platform at no cost and as low as a USD100 deposit. Here is an overview of the types of commonly used brokerages:


DD - Dealing Desk: A dealing desk broker is a Market maker. Market makers typically offer fixed spreads and may elect to quote above or below actual market prices at any time. Market makers are always the counter party of the trader, who doesn't trade directly with the liquidity providers. Market makers get paid through the spreads, and they usually also take the opposite trades of their clients (meaning they can trade against you) prior to covering themselves (or not) with regards to the liquidity providers.


NDD - No Dealing Desk: An NDD forex broker provides direct access to the interbank market; it can be an STP or STP+ECN broker (see below for STP and ECN broker definitions). With a genuine No Dealing Desk broker, there is no requoting of prices, which means that you can trade during economic announcements without any restrictions. The spreads offered are lower, but they are not fixed, so they can increase significantly when volatility is increasing during major economic announcements. An NDD broker can either charge a commission on each trade or choose to increase the spread.

STP - Straight Through Processing: In STP mode, transactions are fully computerised and are immediately processed on the interbank market without any broker intervention. The fact that traders have access to the true market and can execute trades immediately without any dealer intervention is what makes STP platforms most desired by traders. All orders are sent directly to multiple liquidity providers from around the world. This means absolutely no manual manipulation, stop-hunting, shading, or requotes (except during times of unusual volatile movement or market illiquidity).


ECN - Electronic Communication Network: ECN brokers provide and display real-time order book information (featuring the orders that were processed and the prices offered by banks on the interbank market). They thereby improve market transparency by providing information to all market participants. ECN brokers usually make their money by charging a commission on the traded volume. With ECN brokers, all transactions are directly processed on the interbank market in No Dealing Desk mode.

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Now, most Forex people will tell you that it is always advisable to do demo trading (using money from the sky!) before the real one; I will agree, with these conditions - treat the demo money with respect, trade as if your life depends on it and trade on realistic amounts as if you are doing a real trade. Because I can tell you - your emotions between the two worlds of real and demo tradings are NEVER the same! That's why so-called gurus out there will tell you not to trade on emotions... I say, that's crap; how can one detach himself from his emotions? You tell me! Sufficient education is the answer - on which your trading decisions will be based upon primarily... and less on emotions. Go ahead...sign up for a practice account today!

 

Traders in general have agreed on this trading commandment... The Trader's Creed


These Japanese Candlesticks should give a whole new meaning to your technical analysis.

 

Should We Dabble With Robots?

When clicking on the 'New Order' button gives your stomach butterflies, then robots could set your Forex life in motion for you. A robot has no emotion.

 

In brief, a robot is a software system that is extreme in its computational ability... and, given sufficient parameters, should be able to trade well... and fattens your account over time. At least that's what anyone would like to expect (or, would want you to think)! Unfortunately, out there, robots are not made equal and that is why we have to buy into the gimmicks of their makers and trade reviews. Do that many times and hopefully you will land yourself a really good one... hopefully! It's a never-ending game... since the Forex market is dynamic and continually evolving in nature. The robots should, too, if they were to remain relevant.

 

Anyway, play safe - do not trust a robot as if it's your wife (heck, sometimes, you can't even trust your wife, agree? Pun intended!). Let it manage moderate amounts, say USD1000 or less, to start with.

 

Personally, I would be quite happy to employ these digital servants (or, nemeses?) in diversified accounts. Remember what they say - never put your eggs in one basket?

Ultimately, IF one has a strong belief in the Forex market, he should endeavour to become an independent trader. Afterall, a human is still smarter than a bot.

 

Note: Notwithstanding, I am in no way advocating the use of such robots! However, you will never know until you try one! For the life of me, I am not going to stop you...!

 

Explore the many indisputable benefits of trading the Forex market





RISK WARNING: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade foreign exchange you should carefully consider your monetary objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your deposited funds and therefore you should not speculate with capital that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent advisor if you have any doubts. Past returns are not indicative of future results.

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