In the past, many traders used fundamental analysis as a main basics in their forex trading system. How they trade is they analyze both past and current and economic events or news to predict price movements in the forex market.

It was true that in the past, when there was a release in economic news or events, there were some big movements for the currencies and traders took the opportunities to take advantage of that. They could make some big gains when the movements were strong, but now is a totally different story because those big movements have subside and it’s not easy to trade news. Fundamental analysis is a difficult forex strategy to implement in your trading as it requires very strong knowledge and experience to analyze the enormous and deep data. As if this was not enough, decisions of what is and is not important when it comes to fundamental analysis and whether that certain data is relevant is not easy to be made.

Today, most traders who are successful in forex trading will use the analysis which is widely used and useful, and that is technical analysis. Although in technical analysis, you may find it not much simpler to master them, but it will take you shorter time and easier to learn due to it’s nature and if you can abide by the rules.

It’s always important that you understand the below 3 forex trading strategies for technical analysis:

1. A forex currency price will follow a trend and the trend can be identified by looking at the patterns or history in forex charts. If anyone tells you that he can also profit from counter-trend markets consistently, yes…it can be done, but you’ll need some experience and forex techniques to do it well over a long period of time.
2. The market forces will drive the price up or down by economic news releases, but that is not the most important thing because what can you do even if you know that? Those are tough to predict and we can’t use that as a proper trading technique. But as far as technical analysis is concerned, we know that it is simply the price movements themselves and we will know what direction they are going by judging the action of the price using some forex indicators like MA, support and resistance etc.
3. A currency price not only shows the price history of the past, but will also follow the trend that was in the past. Some very important technical analysis is to use Moving Averages, Bollinger Bands, MACD to keep track of the trend. When the prices come into consolidation, which means there is no trend, you should use a different approach for a different market. You should use support and resistance, breakout strategies etc to analyze the forex market. When the prices retraces, you will use price action and indicators to judge whether are they continuing with the trend.

Many ‘fundamentalist’ or economist still find it hard to accept the principles of technical analysis and believe you cannot predict the price movement as it is a random walk. Nevertheless, the fact that many forex traders are successful in their trading using technical analysis devises that there is no 100% accuracy but rather combining the analysis with strategies like risk to reward ratio, money and risk management to make whole thing work.

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This is the second part of the post of how to win in forex trading using the right forex trading strategy . If you missed the first post of forex education with the first 3 secrets, you can find it by Clicking Here . We will continue the rest of the forex tips below.

4. What is the current condition of the forex market? Before you take in any forex trading signals, you have to be sure what conditions is the market showing, trendy or choppy. You can use indexes such as the Asia/Pacific, Europe and Dow Jones Industrial Average as tools to evaluate the market. Most of the time, the movements of the market are based on what the current economy is performing, and that will be the basis for traders to make a decision.

5. Are you mentally alert or stressful? In forex trading, it is very important that you maintain a calm and fresh mind before you even start to look at the charts. Do not trade when you are tired or stressed as there is a high tendency that you will make some mistakes and put your forex investments at risk. Without the right mind, you won’t be able to concentrate well even if you are using one of the best forex trading systems .

6. Do you have a stop loss or target to exit a trade? One of the biggest mistakes that forex traders made is trading without a stop loss. I have stressed many times that every position must have a stop loss but till now, there are many of my members still trading without setting a stop. Are you one of them? Without a stop loss, do you know that you can wipe out your trading account very easily? The problem with those people who do not set a stop is because they do not want to loose, and I mentioned that forex trading  definitely will have losses. And that’s how professional traders live their lives. It is how you manage your losses and not how you try to avoid losses. Never have a huge stop loss unless you are doing swing trading. Even so, 50 to 80 pips will be a good guide.

7. Do you know when to enter a trade? After knowing when to cut your losses, it is important that you enter a trade with good timing especially if you are doing intraday trading. If you do not have a good forex strategy, you can look for some online trading software which provides accurate forex signals that you can follow. For me, I use oscillators like Stochastic and RSI intensively because they are the main forex indicators for my trading system. Timing is important if you have a tight stop loss, as you would want to catch the trade early but at the period where there is a higher winning probability. I know this is not very easy for a beginner, but practice makes perfect!

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Learn to trade forex using my simple, time tested and proven forex trading system , CLICK HERE to download my free 56-page “Forex Trading To Riches” ebook now. You will also receive my free weekly PowerPips Newsletter jammed packed with useful forex training, forex signals, forex strategies in the forex market, forex forex education etc. If you have any further comment please do remember to comment below.

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This is the second part of the top 10 forex trading techniques. You can find the first part over HERE. Today we’ll continue to discuss about the next 5 forex trading strategies:

6. Getting Rid Of Your Emotions - To be a successful trader, you really need to get rid of one bad thing, and that is emotions. Your emotions is the one that caused you to be greedy, afraid, stressful and too excited. You have to leave them behind before they lead your trading to financial disaster. I have seen a lot of traders failed not because their forex trading systems are not working and not because they got no money management, but it is the psychological barrier that is the toughest to cross over.

7. Keep A Trading Journal or Diary - This will be very useful when you look at the past successful and unsucessful trades. The journal will let you learn from the mistakes that you have made, so that you will not repeat it again and also to repeat the procedure that you have for your successful trades. Besides that, you should take note of when and what you bought and sell a currency pair, so you will just need to follow it to maintain your trading consistency.

8. Build Up Your Confidence -I know it’s tough in the beginning when you just started to learn how to trade forex. That’s why you should have a proven forex strategy, learn it, have some trading experience in a demo account before you go live trading. This will slowly build up your confidence and experience in trading. I only went into live trading when I achieved a success rate of 80% in my demo trading few years ago. On the contrary, if you are doing very well from the beginning, you should be careful because one bad trade can shatter your confidence.

9. Stay Out When You Have Doubt -Stay out of the aggresive and brutal forex market when you are unsure of the market conditions. There are countless opportunities to trade, so wait for another good opportunity. A forex tip is, when the market is not trending, most probably it is choppy and you should keep out of it if you are still unexperienced.

10. Do Not Over Trade -No matter how good your forex trading techniques are and how many great forex trading signals you can find, you should not be over trading at all. For me, I only open a second position when my first trade is in profits. Go for quality trades instead of quantity. Imagine Trader A have to make 10 pips per day in order to make 300 pips per month, while Trader B only trades 4 times in a month to make 300 pips. So which method will you choose? The more stressful one or the more patient?

The two parts of the forex trading techniques can certainly help you in your trading if you implement it. If you are still unsure and do not have a good trading system to help you, you can download my f.ree forex ebook which I provide at the top. Have a great day!

There are some traders who do not know what has gone wrong after they have a bad trade. Some trading strategies may work for one person but may not work for another because they have their own trading style. So below is the first part of the most commonly used and proven forex trading techniques that can serve as a useful guide.

1. Follow the forex trends - If you want to make consistent income from the forex market, you really have to follow the trend as the trend is your best friend. The currency market is probably smarter than you, so don’t go into a trade which a trend has not yet started! Going against this principle is a recipe for disaster. You will only open a high probable trade when the forex indicators have confirmed a trend has taken place.

2. Stick with your forex trading strategies plan - Many traders failed because they fail to plan their forex strategy. Always have a trading plan at the start of the day, no matter what forex trading systems you are using. Do not shift out from the plan even if the trade is not going along your direction. The plan should help you make money by targeting profit levels and reduce losses, so just stick with it.

3. Get out of a bad trade - If you are to be successful in trading, you must not hold on or add position to a bad trade. Many people think that the bad trade will eventually turn around and become profitable. That is totally disastrous. You need to get out of bad trades as soon as you discover it, so that you still have the remaining trading capital to continue trading. Imagine that you have not enough capital to trade after you lost that bad trade, won’t it be frustrating?

4. Protect your trading capital - Capital preservation is vital and it can decide whether you will be a successful trader for a long haul. You can achieve that by not risking too much of your trading capital. One of the good forex tips is that you should never risk more than 5% of your trading capital per trade. This is to ensure you have adequate capital to continue trading.

5. Get out of the market once you have profits - This is knowing when to take your profits and call it a day, of course you must have some forex trading systems that give you good entries and exits. Some traders are greedy and they want to wait for huge gain before they take their profits and some take profits too early to miss maximizing the trade. Both of the situations should not happen to you, so you will need some good forex indicators to guide you on your stop loss and profit taking levels.