Forex and Online Currency trading
تجارة العملةاكسب الاف الدولارات شهرياتعلم العمل في البورصة الدولية للعملات وانت جالس فى منزلكاشتر مئات الآلاف من العملات الدولية بمئات الدولارات فقطًيمكنك الحصول على الربح سواءاً ارتفعت الأسعار أم انخفضتيمكنك العمل في أي وقت تشاء على مدار 24 ساعة في اليوميمكنك فتح حساب بدون عمولاتنقطتان هو اقل فرق بيع وشراء فى كل الأسواق العالميةنقدم لك نصائح اهل الخبرة فى مجال تجارة العملةتدريبات فى تجارة العملةاستراتيجيات وطرق للتجارةFOREX is the world’s largest and most liquid trading market. Many and many traders consider FOREX or the currency trading as the best home business opportunity you can ever venture in.Allthough it has been of a loosely guarded secret, more and more investors are turning to FOREX trading to make money and profit. This is because Forex or Currency Trading has numerous benefits & advantages over the other traditional trading vehicles, like commodities, stocks and bonds.As an old trader said, FOREX Trading is like picking money up off the floor. And for any other person, who is Not trading FOREX, is like leaving the money there for someone else to pick it up. Others in the industry of forex trading have also said that FOREX Trading is like having an ATM machine on your computer.But, still, because Forex seems new or is just becoming a part of social conversation, news articles, the mind has to be open and the slate has to be clear for starting out fresh with the CORRECT information.Forex Brokers: Helping to Maximize Your Success in Forex Trading:A Forex broker is a broker dealing in foreign exchange. He is just like real estate broker. A Forex broker is an advisor who can advise you about the forex market and allows you to trade 24 hours a day with the major currencies like EUR, GBP, CHF, JPY, etc against the USD on the spot.Still, there are many great Forex brokers who maintain competitive spreads in the three or four major currencies against the Dollar, and also many other currency pairs including USD/CAD and AUD/USD. They also have major features like:1- Real-time streaming prices2- Price certainty on market orders3- Competitive pricing4- Fixed 2-5 pip spreadsكيف تختار شركة وساطة جيدة لكى تفتح حساب تداول معها ؟خدمة عملاء جيدة و سريعةفرق بيع وشراء منخفضاسعار تنافسيةسوفت وير متقدم
Tuesday, September 4, 2007
Forex Money Management
Forex Money Management
Forex Money ManagementMoney management is a critical point that shows difference between winners and losers. It was proved that if 100 traders start trading using a system with 60% winning odds, only 5 traders will be in profit at the end of the year.MINDSET OF THE MILLIONAIRE TRADERShow millionare traders think ..operate..deal with the market ..self manage..money manage their trading account .very important book for all traders.
Forex Money ManagementMoney management is a critical point that shows difference between winners and losers. It was proved that if 100 traders start trading using a system with 60% winning odds, only 5 traders will be in profit at the end of the year.MINDSET OF THE MILLIONAIRE TRADERShow millionare traders think ..operate..deal with the market ..self manage..money manage their trading account .very important book for all traders.
the strategy
THE STRATEGYOk now, enough with basics. Let’s get down to the actualstrategy.Exchange rates of currency pairs fluctuate based on manycriteria, particularly how investors perceive the value should bebased upon news pertaining to the country of origin of thecurrency. There are many factors that contribute to the perceivedvalue of a currency against another, but most importantly are the“Fundamental Announcements” from that country.Countries and their currencies being traded on the Forex marketsare like companies and their shares being traded on the stockmarket. If a company announces positive news, such as higherprofits in their last quarter, then the stock market immediatelyresponds by the share price rising. Conversely, if the companyannounces negative news such as a loss in their last quarter, thentheir stock drops. In much the same way countries regularlymake various announcements of economic importance, and thevalue of their currency is also adjusted accordingly against othercurrencies.You don’t have to know what the announcement is or even careabout the news to profit by it with this system. All you need toknow is when such Fundamental Announcements are beingmade, and how to profit from it as described in this system. Thisis like owning a magical crystal ball to know exactly theminute when the markets will explode, and how to profit fromit. Regardless of whether the news is considered good or bad,and regardless of how the value of the currency changes due tothe announcement you will make money. Typically a marketeBook 1 “Amazing FOREX System” - © 2004 Robert Borowski – www.AmazingForexSystem.comDuplication and distribution of this material is strictly forbidden11responds by 50 pips to Fundamental Announcements (when itskyrockets); plenty of room to get profits in.There are certain websites that publish a calendar ofFundamental Announcements. You can easily find these for freeon many Forex related websites, and I link to them in the resourcesection of my website (see Appendix A).So the first step is to go to view a Fundamental Announcementscalendar to see what is scheduled to come up for tomorrow(weekdays, not weekends). Some days will have moreannouncements, some days will have less. Generally, the moreannouncements the more trading opportunities you will have, andthe more announcements scheduled for a particular country at thesame time the more likely you will see some interesting priceaction.Before we continue you will need to know what your time zone isin relation to GMT (Greenwich Mean Time), as mostannouncements are published according to this time zone.Where I live is EST (Eastern Standard Time), which is minus 5hours from GMT, however during the summer I am only minus 4hours from GMT. Make sure you take into consideration “DaylightSavings Time” if your time zone changes time in the fall andspring. You will need this information to adjust GMT time to yourtime to know when the announcements will take place from theperspective of your time zone.On the calendars you will see a list of countries that are planningto release announcements, what time the announcement willhappen, and what the announcement is about. Again, you don’treally care what it will be about, only when and who.eBook 1 “Amazing FOREX System” - © 2004 Robert Borowski – www.AmazingForexSystem.comDuplication and distribution of this material is strictly forbidden12Let’s say the US is scheduled to release some announcements,typically 8:30am EST. Then you know the exact time that priceswill skyrocket.Let’s take a look at a chart to see what happened on a fairlytypical occasion. (See chart 1) This is a 1-minute candlestickchart of EUR/USD on June 14, 2004. You will notice that before8:30am the market was just moving slowly along, at 8:30amprices fluctuated just a few pips, then at 8:31am WHAM! it shotstraight up over 25 pips in one minute and over the course of 15minutes it went up about 65 pips. After that the market returnedto moving slowly. Had you traded this system at this time youcould have easily walked away with around 40 pips ($400 UStrading one regular lot, $800 trading two lots, $1,200 trading threelots, you get the idea).This kind of opportunity happens all the time and is by no meansextraordinary. Often it keeps going even further, and if youemploy some of the advanced strategies offered in this coursethen you can sometimes capture over a hundred pips, evenhundreds.Fundamental Announcements occur at various times of the dayand night, depending on where you live. Pay more attention tothe currencies that make their Fundamental Announcements at atime convenient for you. If you live in North America pay attentionto the US and Canadian announcements, and then tradeEUR/USD and USD/CAD respectively. US announcements canbe traded against other currencies, the best are EUR, GBP andCHF. They usually react the same way, but often have larger orsmaller moves (compare chart 2 & 3 as these both happened atthe same time, however you would have made an extra 20 to 30pips trading GBP over EUR). If you live in the Asian regionseBook 1 “Amazing FOREX System” - © 2004 Robert Borowski – www.AmazingForexSystem.comDuplication and distribution of this material is strictly forbidden13including Australia & New Zealand then pay more attention tothose currencies (JPY, AUD, NZD) traded against the USD, andeven against each other. If you are lucky to live in Europe thenyou benefit from being awake during most FundamentalAnnouncement times, and can trade just about anything.Sometimes major news events can cause major price moves, butdon’t worry about these, as they are unpredictable and verydifficult to profit from since by the time you find out about thenews it’s already too late.
why forex
FOREX" OR "FX" MARKET The currency (foreign exchange) market is the largest market in the world. It is also called the foreign exchange market, or "FOREX" or "FX" market for short. It is the biggest and most liquid market in the world, and it is traded mainly through the 24 hour-a-day Interbank currency market - the primary market for currencies. The FOREX market is a cash (or "spot") interbank marekt. By comparison, the currency futures market is only one percent as big. Foreign Exchange simply means the buying of one currency and selling another at the same time. In other words, the currency of one country is exchanged for those of another. The currencies of the world are on a floating exchange rate, and are always traded in pairs - Euro/Dollar, Dollar/Yen, etc. In excess of 85 percent of all daily transactions involve trading of the major currencies - Australian Dollar, British Pound, Canadian Dollar, Japanese Yen, Swiss Franc, and the U.S. Dollar. Unlike the futures and stock markets, trading of currencies is not centralized on an exchange. Forex literally follows the sun around the world. Trading moves from major banking centres of the U.S. to Australia and New Zealand, to the Far East, to Europe and finally back to the U.S. In the past, the FOREX interbank market was not available to small speculators due to the large minimum transaction sizes and often-stringent financial requirements. Banks, major currency dealers and the occasional huge speculator used to be the principal dealers. Only they were able to take advantage of the currency market's fantastic liquidity and strong trending nature of many of the world's primary currency exchange rates.
Glossary of Forex (Foreign Exchange) Terminology
Glossary of Forex (Foreign Exchange) Terminology
AAggregate Demand - The sum of government spending, personal consumption expenditures, and business expenditures. Appreciation - A currency is said to ‘appreciate ‘ when it strengthens in price in response to market demand. Arbitrage - The purchase or sale of an instrument and simultaneous taking of an equal and opposite position in a related market, in order to take advantage of small price differentials between markets. Around - Dealer jargon used in quoting when the forward premium/discount is near parity. For example, “two-two around” would translate into 2 points to either side of the present spot. Ask Rate - The rate at which a financial instrument if offered for sale (as in bid/ask spread). Asset Allocation - Investment practice that divides funds among different markets to achieve diversification for risk management purposes and/or expected returns consistent with an investor’s objectives. BBack Office - The departments and processes related to the settlement of financial transactions. Balance of Trade - The value of a country’s exports minus its imports.Bar Charts - Standard bar charts are commonly used to convey price activity into an easily readable chart. Usually four elements make up a bar chart, the Open, High, Low, and Close for the trading session/time period. A price bar can represent any time frame the user wishes, from 1 minute to 1 month. The total vertical length/height of the bar represents the entire trading range for the period. The top of the bar represents the highest price of the period, and the bottom of the bar represents the lowest price of the period. The Open is represented by a small dash to the left of the bar, and the Close for the session is a small dash to the right of the bar. Base Currency - In general terms, the base currency is the currency in which an investor or issuer maintains its book of accounts. In the FX markets, the US Dollar is normally considered the ‘base’ currency for quotes, meaning that quotes are expressed as a unit of $1 USD per the other currency quoted in the pair. The primary exceptions to this rule are the British Pound, the Euro and the Australian Dollar. Bear Market - A market distinguished by declining prices. Bid Rate - The rate at which a trader is willing to buy a currency.Page 1 of 11 www.Forex-trader.comBid/Ask Spread - The difference between the bid and offer price, and the most widely used measure of market liquidity. Big Figure - Dealer expression referring to the first few digits of an exchange rate. These digits rarely change in normal market fluctuations, and therefore are omitted in dealer quotes, especially in times of high market activity. For example, a USD/Yen rate might be 107.30/107.35, but would be quoted verbally without the first three digits i.e. “30/35”. Book - In a professional trading environment, a ‘book’ is the summary of a trader’s or desk’s total positions. Broker - An individual or firm that acts as an intermediary, putting together buyers and sellers for a fee or commission. In contrast, a ‘dealer’ commits capital and takes one side of a position, hoping to earn a spread (profit) by closing out the position in a subsequent trade with another party. Bretton Woods Agreement of 1944 - An agreement that established fixed foreign exchange rates for major currencies, provided for central bank intervention in the currency markets, and pegged the price of gold at US $35 per ounce. The agreement lasted until 1971, when President Nixon overturned the Bretton Woods agreement and established a floating exchange rate for the major currencies. Bull Market - A market distinguished by rising prices. Bundesbank - Germany’s Central Bank.Buying/Selling - In the forex market currencies are always priced in pairs; therefore all trades result in the simultaneous buying of one currency and the selling of another. The objective of currency trading is to buy the currency that increases in value relative to the one you sold. If you have bought a currency and the price appreciates in value, then you must sell the currency back in order to lock in the profit.C Cable - Trader jargon referring to the Sterling/US Dollar exchange rate. So called because the rate was originally transmitted via a transatlantic cable beginning in the mid 1800’s. Candlestick Chart - A chart that indicates the trading range for the day as well as the opening and closing price. If the open price is higher than the close price, the rectangle between the open and close price is shaded. If the close price is higher than the open price, that area of the chart is not shaded. Central Bank - A government or quasi-governmental organization that manages a country’s monetary policy. For example, the US central bank is the Federal Reserve, and the German central bank is the Bundesbank. others include the ECB, BOE, BOJ. Chartist - An individual who uses charts and graphs and interprets historical data to find trends and predict future movements. Also referred to as Technical Trader. Choice Market- A market with no spread. All trades buys and sells occur at that one pricePage 2 of 11 www.Forex-trader.comClearing - The process of settling a trade. Contagion - The tendency of an economic crisis to spread from one market to another. In 1997, political instability in Indonesia caused high volatility in their domestic currency, the Rupiah. From there, the contagion spread to other Asian emerging currencies, and then to Latin America, and is now referred to as the ‘Asian Contagion’. Collateral - Something given to secure a loan or as a guarantee of performance. Commission – A transaction fee charged by a broker.Contagion - The tendency of an economic crisis to spread from one market to another. In 1997, financial instability in Thailand caused high volatility in its domestic currency, the Baht, which triggered a contagion into other East Asian emerging currencies, and then to Latin America. It is now referred to as the Asian Contagion Confirmation - A document exchanged by counterparts to a transaction that states the terms of said transaction. Contract - The standard unit of trading.Contract (Unit or Lot) - The standard unit of trading on certain exchanges. Counterparty - One of the participants in a financial transaction. Country Risk – Risk associated with a cross-border transaction, including but not limited to legal and political conditions such as war etc. Cross Rates - The exchange rate between two currencies expressed as the ratio of two foreign exchange rates that are both expressed in terms of a third currency. Foreign exchange rate between two currencies other than the U.S. dollar, the currency in which most exchanges are usually quoted.Currency - Any form of money issued by a government or central bank and used as legal tender and a basis for trade. Currency Risk - the probability of an adverse change in exchange rates.D Day Trading - Refers to positions which are opened and closed on the same trading day. Dealer - An individual who acts as a principal or counterpart to a transaction. Principals take one side of a position, hoping to earn a spread (profit) by closing out the position in a subsequent trade with another party. In contrast, a broker is an individual or firm that acts as an intermediary, putting together buyers and sellers for a fee or commission. Deficit - A negative balance of trade or payments. Delivery - An FX trade where both sides make and take actual delivery of the currencies traded.Page 3 of 11 www.Forex-trader.comDepreciation - A fall in the value of a currency due to market forces. Derivative – A contract that changes in value in relation to the price movements of a related or underlying security, future or other physical instrument. An Option is the most common derivative instrument. Devaluation - The deliberate downward adjustment of a currency’s price, normally by official announcement.E Economic Indicator - Economic indicators such as GDP, foreign investment, and the trade balance reflect the general health of an economy, and are therefore responsible for the underlying shifts in supply and demand for that currency.End Of Day Order (EOD) - An order to buy or sell at a specified price. This order remains open until the end of the trading day which is typically 5PM ET. EURO – since 2002 the Euro has been the currency of the European Monetary Union (EMU). A replacement for the European Currency Unit (ECU). Members of the EMU are Germany, France, Belgium, Luxembourg, Austria, Finland, Ireland, the Netherlands, Italy, Spain and Portugal. European Central Bank (ECB) - the Central Bank for the new European Monetary Union.F Federal Deposit Insurance Corporation (FDIC) - The regulatory agency responsible for administering bank depository insurance in the US. Federal Reserve System - The central bank of the United States, with responsibility for implementing the country's monetary policy and regulating member banks of the System. The Fed was created in 1913 and is composed of 12 regional Federal Reserve Banks and a national Board of GovernorsFixed Exchange Rate- Official rate set by monetary authorities for one or more currenciesFloating Exchange Rates - Floating exchange rates refer to the value of a currency as decided by supply and demandFlat/square - Dealer jargon used to describe a position that has been completely reversed, e.g. you bought $500,000 then sold $500,000, thereby creating a neutral (flat) position. Foreign Exchange - (Forex, FX) is the simultaneous buying of one currency while selling for another. This market of exchange has more buyers and sellers and daily volume than any other in the world. Taking place in the major financial institutions across the globe, the forex market is open 24-hours a day. Forward - The pre-specified exchange rate for a foreign exchange contract settling at somePage 4 of 11 www.Forex-trader.comagreed future date, based upon the interest rate differential between the two currencies involved.Forward Contract - A forward contract fixes the exchange rate for future delivery at a date to be agreed by both participants. A deposit (or a minimum margin) is usually required in forward transactions. For example, if I want to lock in today's rate to buy $10,000 USD at 1.5820 Canadian for the next 4 months, I will have the ability to purchase up to $10,000 USD at this rate.Forward Rates (Swaps) - A Forward Rate refers to a cash price of 2 currencies interest difference for a fixed term. Forward rates can be calculated easily given the fixed term interest rates of each currency and the current spot rateForward Trading - Forward trading is making the opposite trade of a spot trade in a given period of time. Often investors will swap their trades forward for anywhere from a week or two up to several months depending on the time frame of the investment. Even though a forward trade is on a future date, the position can be closed out at any time. The closing part of the position is then swapped forward to the same future value date Forward points - The pips added to or subtracted from the current exchange rate to calculate a forward price. Fundamental Analysis - focuses on the economic forces of supply and demand that causes price movement. The Fundamentalist studies the causes of market movement, whereas the Technician studies the effects. Futures Contract- An obligation to exchange a good or instrument at a set price on a future date. The primary difference between a Future and a Forward is that Futures are typically traded over an exchange (Exchange- Traded Contacts – ETC), versus forwards, which are considered Over The Counter (OTC) contracts. An OTC is any contract NOT traded on an exchange.GGearing - Also known as margin trading. A term used to in the relationship of actual equity versus controlling equity.Group of Five (G5) - are five leading industrial nations (France, Japan, Germany, the UK and US), which meet from time-to-time to discuss common economic problems.Group of Seven (7) are 7 leading non-communist industrial nations composed of G5 plus Canada and Italy. Group of Ten (G10) is also known as The Paris Club which includes Belgium, Canada, France, Germany, Italy, Japan, the Netherlands, Sweden, UK and US. These nations signed an accord in 1962 to increase the fund available to the IMF and aid member countries with balance-of-payments difficulties.Goldilocks Economy was a term coined back in the mid-1902 to describe an economy that was not too hot and not too cold. This typically describes an economy that enjoyed steady growth with nominal rate of inflation.Page 5 of 11 www.Forex-trader.comGood ‘til Cancelled (GTC) - An order to buy or sell at a specified price. This order remains open until filled or until the client cancels.H Hedging - A hedging transaction is a purchase or sale of a financial product, having as its purpose the elimination of loss arising from price fluctuations. With regards to currency transactions it would protect one against fluctuations in the foreign exchange rate. (see Forward Contract)I Inflation - An economic condition whereby prices for consumer goods rise, eroding purchasing power. Initial margin - The initial deposit of collateral required to enter into a position as a guarantee on future performance. Interbank Rates - The Foreign Exchange rates at which large international banks quote other large international banks.L Leading Indicators - Statistics that are considered to predict future economic activity. LIBOR - The London Inter-Bank Offered Rate. Banks use LIBOR when borrowing from another bank. Limit order - An order with restrictions on the maximum price to be paid or the minimum price to be received. As an example, if the current price of USD/YEN is 102.00/05, then a limit order to buy USD would be at a price below 102. (ie 101.50)Line Charts - The Line Chart connects single prices for a selected time period.Liquidity - The ability of a market to accept large transaction with minimal to no impact on price stability. Liquidation - The closing of an existing position through the execution of an offsetting transaction. Long position - A position that appreciates in value if market prices increase. When one buys a currency, their position is long.M Margin - The required equity that an investor must deposit to collateralize a position.Page 6 of 11 www.Forex-trader.comMargin Deposit - The margin deposit is not a down payment on a purchase of equity, as many perceive margins to be in the stock markets. Rather, the margin is a performance bond, or good faith deposit, to ensure against trading losses. The margin requirement allows traders to hold a position much larger than the account value, which allow for this high leverage. In the event that funds in the account fall below margin requirements, brokerage firms will automatically close all open positions. Margin call - A request from a broker or dealer for additional funds or other collateral to guarantee performance on a position that has moved against the client. If the equity balance in your account falls below the margin requirement, a margin call will be generated. In the event that an account exceeds its maximum allowable leverage, ALL open positions are liquidated immediately, regardless of the size or the nature of positions held within the account. Market Maker - A dealer who regularly quotes both bid and ask prices and is ready to make a two-sided market for any financial instrument. Market Risk - Exposure to changes in market prices. Mark-to-Market - Process of re-evaluating all open positions with the current market prices. These new values then determine margin requirements. Maturity - The date for settlement or expiry of a financial instrument.NNarrow Market - occurs when there is light trading and greater fluctuations in prices relative to volume. This is often interchanged for THIN MARKET.O Offer - The rate at which a dealer is willing to sell a currency. Offsetting transaction - A trade with which serves to cancel or offset some or all of the market risk of an open position. One Cancels the Other Order (OCO) - A designation for two orders whereby one part of the two orders is executed the other is automatically cancelled. Open order – An order that will be executed when a market moves to its designated price. Normally associated with Good ‘til Cancelled Orders. Open position - A deal not yet reversed or settled with a physical payment. Over the Counter (OTC) - Used to describe any transaction that is not conducted over an exchange. Overnight - A trade that remains open until the next business day.PPage 7 of 11 www.Forex-trader.comPips - Digits added to or subtracted from the fourth decimal place, i.e. 0.0001. Also called Points. Political Risk - Exposure to changes in governmental policy which will have an adverse effect on an investor’s position.Point & Figure charts - The Point & Figure Chart disregards Time and focuses entirely on price activity. Position - The netted total holdings of a given currency. Premium - In the currency markets, describes the amount by which the forward or futures price exceed the spot price. Price Transparency - Describes quotes to which every market participant has equal access.Q Quote - An indicative market price, normally used for information purposes only.R Rate - The price of one currency in terms of another, typically used for dealing purposes. Resistance - A term used in technical analysis indicating a specific price level at which analysis concludes people will sell. Revaluation - An increase in the exchange rate for a currency as a result of central bank intervention. Opposite of Devaluation. Revaluation Rates - The revaluation rates are the market rates used when a trader runs an end-of-day to establish profit and loss for the day. Risk - Exposure to uncertain change, the variability of returns significantly the likelihood of less-than-expected returns. Risk Capital- The amount of money that an individual can afford to invest, which, if lost would not affect their lifestyle. Risk Management - To hedge one’s risk they will employ financial analysis and trading techniques Roll-Over - Process whereby the settlement of a deal is rolled forward to another value date. The cost of this process is based on the interest rate differential of the two currencies.Rollover Rate -The daily rollover interest rate is the amount a trader either pays or earns, depending on the established margin and position in the market. To avoid rollovers simply make sure positions are closed at the established end of the market day.S Settlement – The process by which a trade is entered into the books and records of the counterparts to a transaction. The settlement of currency trades may or may not involve thePage 8 of 11 www.Forex-trader.comactual physical exchange of one currency for another. Short Position - An investment position that benefits from a decline in market price. When one sells a currency their position is short.Spot/Next - A currency deposit transaction or the simultaneous purchase and sale of currency, or vice versa by means of swap for spot value day against the next working day.Spot Price – The current market price. Settlement of spot transactions usually occurs within two business days.Spot (Rate) - In FX Markets, Spot refers to the cash price without interest factored in.Spot Trade - When you trade foreign exchange you are always quoted a spot price 2 business days in advance. This is under normal conditions where there are no bank holidays in the traded currencies countries or is not over a weekend.Spread - The difference between the bid (buy) and offer (ask, sell) prices; in other words the spread is the commission that the brokerage house makes on each trade. This can vary widely between currencies and between brokerage firms. For example, USD/JPY may bid at 131.40 and ask at 131.45, this five-pip spread defines the trader’s cost, which can be recovered with a favorable currency move in the market. Sterling – slang for British Pound.Stop Loss Order - Order type whereby an open position is automatically liquidated at a specific price. Often used to minimize exposure to losses if the market moves against an investor’s position. As an example, if an investor is long USD at 156.27, they might wish to put in a stop loss order for 155.49, which would limit losses should the dollar depreciate, possibly below 155.49.Stochastics Oscillator - This technical analysis indicator is based on the premise that during an upward trading market, prices tend to close near their high, and during a downward trading market, prices tend to close near their low. Support Levels - A term used in technical analysis indicating a specific price level at which a currency will have the inability to cross below. Recurring failure for the price to move below that point produces a pattern that can usually be shaped by a straight line. It is the opposite of Resistance levels. Swap - A currency swap is the simultaneous sale and purchase of the same amount of a given currency at a forward exchange rate.Swift - Society of Worldwide Interbank Financial Telecommunications. It is a dedicated computer network that is set up to support fund transfer messages between member banks worldwide.TPage 9 of 11 www.Forex-trader.comTechnical Analysis - An effort to forecast prices by analyzing market action through chart study, volume, trends, moving averages, patterns, formations and many other technical indicators.Tick - Minimum price move. Ticker - Shows current and/or recent history of a currency either in the format of a graph or table. Tomorrow Next (Tom/Next) - Simultaneous buying and selling of a currency for delivery the following day.Trading - Buying or selling of goods and services among countries called commerce. Forex Trading is the trading of Foreign Currencies. Transaction Cost – the cost of buying or selling a financial instrument. Transaction Date – The date on which a trade occurs.Trend - simply the direction of the market, usually broken down to three categories….major, intermediate and short-term trends. Three directions are also associatedTrend Line - This is a Technical Analysis indicator also called or linear regression, which is a statistical tool used to uncover trends. It is calculated by using the "Least Squares" method. There are two ways to use the linear regression line: a. Trade in the direction of the Trend line. b. Construct a parallel trend channel above and below the Trend line to be used as support and resistance levels. Turnover - The total money value of all executed transactions in a given time period; volume. Two-Way Price - When both a bid and offer rate is quoted for a FX transaction.U Uptick – a new price quote at a price higher than the preceding quote. Uptick Rule – In the U.S., a regulation whereby a security may not be sold short unless the last trade prior to the short sale was at a price lower than the price at which the short sale is executed. US Prime Rate - The interest rate at which US banks will lend to their prime corporate customersV Value Date - The date on which counterparts to a financial transaction agree to settle their respective obligations, i.e., exchanging payments. For spot currency transactions, the value date is normally two business days forward. Also known as maturity date. Variation Margin - Funds a broker must request from the client to have the required margin deposited. The term usually refers to additional funds that must be deposited as a result of unfavorable price movements.Page 10 of 11 www.Forex-trader.comVolatility (Vol) - A measure of price fluctuations. The standard deviation of a price series is commonly used to measure price volatility.Volume - represents the total amount of trading activity in a particular stock, commodity or index for that day. It is the total number of contracts traded during the day.WWeak Dollar/ Strong Dollar - dollar is said to be weak (relative to a previous time period) against another currency when more dollars are required to buy one unit of another currency. The dollar is strong or has gained in strength when fewer dollars are required to buy one unit of another currency. For example, if $1 buys 10 FF in 1989 but today $1 buys only 6 FF then the dollar has weakened against the franc.Whipsaw – slang for a condition of a highly volatile market where a sharp price movement is quickly followed by a sharp reversal.XY Yard – Slang for a billion.YIELD - Return on capital investment.Z________________
AAggregate Demand - The sum of government spending, personal consumption expenditures, and business expenditures. Appreciation - A currency is said to ‘appreciate ‘ when it strengthens in price in response to market demand. Arbitrage - The purchase or sale of an instrument and simultaneous taking of an equal and opposite position in a related market, in order to take advantage of small price differentials between markets. Around - Dealer jargon used in quoting when the forward premium/discount is near parity. For example, “two-two around” would translate into 2 points to either side of the present spot. Ask Rate - The rate at which a financial instrument if offered for sale (as in bid/ask spread). Asset Allocation - Investment practice that divides funds among different markets to achieve diversification for risk management purposes and/or expected returns consistent with an investor’s objectives. BBack Office - The departments and processes related to the settlement of financial transactions. Balance of Trade - The value of a country’s exports minus its imports.Bar Charts - Standard bar charts are commonly used to convey price activity into an easily readable chart. Usually four elements make up a bar chart, the Open, High, Low, and Close for the trading session/time period. A price bar can represent any time frame the user wishes, from 1 minute to 1 month. The total vertical length/height of the bar represents the entire trading range for the period. The top of the bar represents the highest price of the period, and the bottom of the bar represents the lowest price of the period. The Open is represented by a small dash to the left of the bar, and the Close for the session is a small dash to the right of the bar. Base Currency - In general terms, the base currency is the currency in which an investor or issuer maintains its book of accounts. In the FX markets, the US Dollar is normally considered the ‘base’ currency for quotes, meaning that quotes are expressed as a unit of $1 USD per the other currency quoted in the pair. The primary exceptions to this rule are the British Pound, the Euro and the Australian Dollar. Bear Market - A market distinguished by declining prices. Bid Rate - The rate at which a trader is willing to buy a currency.Page 1 of 11 www.Forex-trader.comBid/Ask Spread - The difference between the bid and offer price, and the most widely used measure of market liquidity. Big Figure - Dealer expression referring to the first few digits of an exchange rate. These digits rarely change in normal market fluctuations, and therefore are omitted in dealer quotes, especially in times of high market activity. For example, a USD/Yen rate might be 107.30/107.35, but would be quoted verbally without the first three digits i.e. “30/35”. Book - In a professional trading environment, a ‘book’ is the summary of a trader’s or desk’s total positions. Broker - An individual or firm that acts as an intermediary, putting together buyers and sellers for a fee or commission. In contrast, a ‘dealer’ commits capital and takes one side of a position, hoping to earn a spread (profit) by closing out the position in a subsequent trade with another party. Bretton Woods Agreement of 1944 - An agreement that established fixed foreign exchange rates for major currencies, provided for central bank intervention in the currency markets, and pegged the price of gold at US $35 per ounce. The agreement lasted until 1971, when President Nixon overturned the Bretton Woods agreement and established a floating exchange rate for the major currencies. Bull Market - A market distinguished by rising prices. Bundesbank - Germany’s Central Bank.Buying/Selling - In the forex market currencies are always priced in pairs; therefore all trades result in the simultaneous buying of one currency and the selling of another. The objective of currency trading is to buy the currency that increases in value relative to the one you sold. If you have bought a currency and the price appreciates in value, then you must sell the currency back in order to lock in the profit.C Cable - Trader jargon referring to the Sterling/US Dollar exchange rate. So called because the rate was originally transmitted via a transatlantic cable beginning in the mid 1800’s. Candlestick Chart - A chart that indicates the trading range for the day as well as the opening and closing price. If the open price is higher than the close price, the rectangle between the open and close price is shaded. If the close price is higher than the open price, that area of the chart is not shaded. Central Bank - A government or quasi-governmental organization that manages a country’s monetary policy. For example, the US central bank is the Federal Reserve, and the German central bank is the Bundesbank. others include the ECB, BOE, BOJ. Chartist - An individual who uses charts and graphs and interprets historical data to find trends and predict future movements. Also referred to as Technical Trader. Choice Market- A market with no spread. All trades buys and sells occur at that one pricePage 2 of 11 www.Forex-trader.comClearing - The process of settling a trade. Contagion - The tendency of an economic crisis to spread from one market to another. In 1997, political instability in Indonesia caused high volatility in their domestic currency, the Rupiah. From there, the contagion spread to other Asian emerging currencies, and then to Latin America, and is now referred to as the ‘Asian Contagion’. Collateral - Something given to secure a loan or as a guarantee of performance. Commission – A transaction fee charged by a broker.Contagion - The tendency of an economic crisis to spread from one market to another. In 1997, financial instability in Thailand caused high volatility in its domestic currency, the Baht, which triggered a contagion into other East Asian emerging currencies, and then to Latin America. It is now referred to as the Asian Contagion Confirmation - A document exchanged by counterparts to a transaction that states the terms of said transaction. Contract - The standard unit of trading.Contract (Unit or Lot) - The standard unit of trading on certain exchanges. Counterparty - One of the participants in a financial transaction. Country Risk – Risk associated with a cross-border transaction, including but not limited to legal and political conditions such as war etc. Cross Rates - The exchange rate between two currencies expressed as the ratio of two foreign exchange rates that are both expressed in terms of a third currency. Foreign exchange rate between two currencies other than the U.S. dollar, the currency in which most exchanges are usually quoted.Currency - Any form of money issued by a government or central bank and used as legal tender and a basis for trade. Currency Risk - the probability of an adverse change in exchange rates.D Day Trading - Refers to positions which are opened and closed on the same trading day. Dealer - An individual who acts as a principal or counterpart to a transaction. Principals take one side of a position, hoping to earn a spread (profit) by closing out the position in a subsequent trade with another party. In contrast, a broker is an individual or firm that acts as an intermediary, putting together buyers and sellers for a fee or commission. Deficit - A negative balance of trade or payments. Delivery - An FX trade where both sides make and take actual delivery of the currencies traded.Page 3 of 11 www.Forex-trader.comDepreciation - A fall in the value of a currency due to market forces. Derivative – A contract that changes in value in relation to the price movements of a related or underlying security, future or other physical instrument. An Option is the most common derivative instrument. Devaluation - The deliberate downward adjustment of a currency’s price, normally by official announcement.E Economic Indicator - Economic indicators such as GDP, foreign investment, and the trade balance reflect the general health of an economy, and are therefore responsible for the underlying shifts in supply and demand for that currency.End Of Day Order (EOD) - An order to buy or sell at a specified price. This order remains open until the end of the trading day which is typically 5PM ET. EURO – since 2002 the Euro has been the currency of the European Monetary Union (EMU). A replacement for the European Currency Unit (ECU). Members of the EMU are Germany, France, Belgium, Luxembourg, Austria, Finland, Ireland, the Netherlands, Italy, Spain and Portugal. European Central Bank (ECB) - the Central Bank for the new European Monetary Union.F Federal Deposit Insurance Corporation (FDIC) - The regulatory agency responsible for administering bank depository insurance in the US. Federal Reserve System - The central bank of the United States, with responsibility for implementing the country's monetary policy and regulating member banks of the System. The Fed was created in 1913 and is composed of 12 regional Federal Reserve Banks and a national Board of GovernorsFixed Exchange Rate- Official rate set by monetary authorities for one or more currenciesFloating Exchange Rates - Floating exchange rates refer to the value of a currency as decided by supply and demandFlat/square - Dealer jargon used to describe a position that has been completely reversed, e.g. you bought $500,000 then sold $500,000, thereby creating a neutral (flat) position. Foreign Exchange - (Forex, FX) is the simultaneous buying of one currency while selling for another. This market of exchange has more buyers and sellers and daily volume than any other in the world. Taking place in the major financial institutions across the globe, the forex market is open 24-hours a day. Forward - The pre-specified exchange rate for a foreign exchange contract settling at somePage 4 of 11 www.Forex-trader.comagreed future date, based upon the interest rate differential between the two currencies involved.Forward Contract - A forward contract fixes the exchange rate for future delivery at a date to be agreed by both participants. A deposit (or a minimum margin) is usually required in forward transactions. For example, if I want to lock in today's rate to buy $10,000 USD at 1.5820 Canadian for the next 4 months, I will have the ability to purchase up to $10,000 USD at this rate.Forward Rates (Swaps) - A Forward Rate refers to a cash price of 2 currencies interest difference for a fixed term. Forward rates can be calculated easily given the fixed term interest rates of each currency and the current spot rateForward Trading - Forward trading is making the opposite trade of a spot trade in a given period of time. Often investors will swap their trades forward for anywhere from a week or two up to several months depending on the time frame of the investment. Even though a forward trade is on a future date, the position can be closed out at any time. The closing part of the position is then swapped forward to the same future value date Forward points - The pips added to or subtracted from the current exchange rate to calculate a forward price. Fundamental Analysis - focuses on the economic forces of supply and demand that causes price movement. The Fundamentalist studies the causes of market movement, whereas the Technician studies the effects. Futures Contract- An obligation to exchange a good or instrument at a set price on a future date. The primary difference between a Future and a Forward is that Futures are typically traded over an exchange (Exchange- Traded Contacts – ETC), versus forwards, which are considered Over The Counter (OTC) contracts. An OTC is any contract NOT traded on an exchange.GGearing - Also known as margin trading. A term used to in the relationship of actual equity versus controlling equity.Group of Five (G5) - are five leading industrial nations (France, Japan, Germany, the UK and US), which meet from time-to-time to discuss common economic problems.Group of Seven (7) are 7 leading non-communist industrial nations composed of G5 plus Canada and Italy. Group of Ten (G10) is also known as The Paris Club which includes Belgium, Canada, France, Germany, Italy, Japan, the Netherlands, Sweden, UK and US. These nations signed an accord in 1962 to increase the fund available to the IMF and aid member countries with balance-of-payments difficulties.Goldilocks Economy was a term coined back in the mid-1902 to describe an economy that was not too hot and not too cold. This typically describes an economy that enjoyed steady growth with nominal rate of inflation.Page 5 of 11 www.Forex-trader.comGood ‘til Cancelled (GTC) - An order to buy or sell at a specified price. This order remains open until filled or until the client cancels.H Hedging - A hedging transaction is a purchase or sale of a financial product, having as its purpose the elimination of loss arising from price fluctuations. With regards to currency transactions it would protect one against fluctuations in the foreign exchange rate. (see Forward Contract)I Inflation - An economic condition whereby prices for consumer goods rise, eroding purchasing power. Initial margin - The initial deposit of collateral required to enter into a position as a guarantee on future performance. Interbank Rates - The Foreign Exchange rates at which large international banks quote other large international banks.L Leading Indicators - Statistics that are considered to predict future economic activity. LIBOR - The London Inter-Bank Offered Rate. Banks use LIBOR when borrowing from another bank. Limit order - An order with restrictions on the maximum price to be paid or the minimum price to be received. As an example, if the current price of USD/YEN is 102.00/05, then a limit order to buy USD would be at a price below 102. (ie 101.50)Line Charts - The Line Chart connects single prices for a selected time period.Liquidity - The ability of a market to accept large transaction with minimal to no impact on price stability. Liquidation - The closing of an existing position through the execution of an offsetting transaction. Long position - A position that appreciates in value if market prices increase. When one buys a currency, their position is long.M Margin - The required equity that an investor must deposit to collateralize a position.Page 6 of 11 www.Forex-trader.comMargin Deposit - The margin deposit is not a down payment on a purchase of equity, as many perceive margins to be in the stock markets. Rather, the margin is a performance bond, or good faith deposit, to ensure against trading losses. The margin requirement allows traders to hold a position much larger than the account value, which allow for this high leverage. In the event that funds in the account fall below margin requirements, brokerage firms will automatically close all open positions. Margin call - A request from a broker or dealer for additional funds or other collateral to guarantee performance on a position that has moved against the client. If the equity balance in your account falls below the margin requirement, a margin call will be generated. In the event that an account exceeds its maximum allowable leverage, ALL open positions are liquidated immediately, regardless of the size or the nature of positions held within the account. Market Maker - A dealer who regularly quotes both bid and ask prices and is ready to make a two-sided market for any financial instrument. Market Risk - Exposure to changes in market prices. Mark-to-Market - Process of re-evaluating all open positions with the current market prices. These new values then determine margin requirements. Maturity - The date for settlement or expiry of a financial instrument.NNarrow Market - occurs when there is light trading and greater fluctuations in prices relative to volume. This is often interchanged for THIN MARKET.O Offer - The rate at which a dealer is willing to sell a currency. Offsetting transaction - A trade with which serves to cancel or offset some or all of the market risk of an open position. One Cancels the Other Order (OCO) - A designation for two orders whereby one part of the two orders is executed the other is automatically cancelled. Open order – An order that will be executed when a market moves to its designated price. Normally associated with Good ‘til Cancelled Orders. Open position - A deal not yet reversed or settled with a physical payment. Over the Counter (OTC) - Used to describe any transaction that is not conducted over an exchange. Overnight - A trade that remains open until the next business day.PPage 7 of 11 www.Forex-trader.comPips - Digits added to or subtracted from the fourth decimal place, i.e. 0.0001. Also called Points. Political Risk - Exposure to changes in governmental policy which will have an adverse effect on an investor’s position.Point & Figure charts - The Point & Figure Chart disregards Time and focuses entirely on price activity. Position - The netted total holdings of a given currency. Premium - In the currency markets, describes the amount by which the forward or futures price exceed the spot price. Price Transparency - Describes quotes to which every market participant has equal access.Q Quote - An indicative market price, normally used for information purposes only.R Rate - The price of one currency in terms of another, typically used for dealing purposes. Resistance - A term used in technical analysis indicating a specific price level at which analysis concludes people will sell. Revaluation - An increase in the exchange rate for a currency as a result of central bank intervention. Opposite of Devaluation. Revaluation Rates - The revaluation rates are the market rates used when a trader runs an end-of-day to establish profit and loss for the day. Risk - Exposure to uncertain change, the variability of returns significantly the likelihood of less-than-expected returns. Risk Capital- The amount of money that an individual can afford to invest, which, if lost would not affect their lifestyle. Risk Management - To hedge one’s risk they will employ financial analysis and trading techniques Roll-Over - Process whereby the settlement of a deal is rolled forward to another value date. The cost of this process is based on the interest rate differential of the two currencies.Rollover Rate -The daily rollover interest rate is the amount a trader either pays or earns, depending on the established margin and position in the market. To avoid rollovers simply make sure positions are closed at the established end of the market day.S Settlement – The process by which a trade is entered into the books and records of the counterparts to a transaction. The settlement of currency trades may or may not involve thePage 8 of 11 www.Forex-trader.comactual physical exchange of one currency for another. Short Position - An investment position that benefits from a decline in market price. When one sells a currency their position is short.Spot/Next - A currency deposit transaction or the simultaneous purchase and sale of currency, or vice versa by means of swap for spot value day against the next working day.Spot Price – The current market price. Settlement of spot transactions usually occurs within two business days.Spot (Rate) - In FX Markets, Spot refers to the cash price without interest factored in.Spot Trade - When you trade foreign exchange you are always quoted a spot price 2 business days in advance. This is under normal conditions where there are no bank holidays in the traded currencies countries or is not over a weekend.Spread - The difference between the bid (buy) and offer (ask, sell) prices; in other words the spread is the commission that the brokerage house makes on each trade. This can vary widely between currencies and between brokerage firms. For example, USD/JPY may bid at 131.40 and ask at 131.45, this five-pip spread defines the trader’s cost, which can be recovered with a favorable currency move in the market. Sterling – slang for British Pound.Stop Loss Order - Order type whereby an open position is automatically liquidated at a specific price. Often used to minimize exposure to losses if the market moves against an investor’s position. As an example, if an investor is long USD at 156.27, they might wish to put in a stop loss order for 155.49, which would limit losses should the dollar depreciate, possibly below 155.49.Stochastics Oscillator - This technical analysis indicator is based on the premise that during an upward trading market, prices tend to close near their high, and during a downward trading market, prices tend to close near their low. Support Levels - A term used in technical analysis indicating a specific price level at which a currency will have the inability to cross below. Recurring failure for the price to move below that point produces a pattern that can usually be shaped by a straight line. It is the opposite of Resistance levels. Swap - A currency swap is the simultaneous sale and purchase of the same amount of a given currency at a forward exchange rate.Swift - Society of Worldwide Interbank Financial Telecommunications. It is a dedicated computer network that is set up to support fund transfer messages between member banks worldwide.TPage 9 of 11 www.Forex-trader.comTechnical Analysis - An effort to forecast prices by analyzing market action through chart study, volume, trends, moving averages, patterns, formations and many other technical indicators.Tick - Minimum price move. Ticker - Shows current and/or recent history of a currency either in the format of a graph or table. Tomorrow Next (Tom/Next) - Simultaneous buying and selling of a currency for delivery the following day.Trading - Buying or selling of goods and services among countries called commerce. Forex Trading is the trading of Foreign Currencies. Transaction Cost – the cost of buying or selling a financial instrument. Transaction Date – The date on which a trade occurs.Trend - simply the direction of the market, usually broken down to three categories….major, intermediate and short-term trends. Three directions are also associatedTrend Line - This is a Technical Analysis indicator also called or linear regression, which is a statistical tool used to uncover trends. It is calculated by using the "Least Squares" method. There are two ways to use the linear regression line: a. Trade in the direction of the Trend line. b. Construct a parallel trend channel above and below the Trend line to be used as support and resistance levels. Turnover - The total money value of all executed transactions in a given time period; volume. Two-Way Price - When both a bid and offer rate is quoted for a FX transaction.U Uptick – a new price quote at a price higher than the preceding quote. Uptick Rule – In the U.S., a regulation whereby a security may not be sold short unless the last trade prior to the short sale was at a price lower than the price at which the short sale is executed. US Prime Rate - The interest rate at which US banks will lend to their prime corporate customersV Value Date - The date on which counterparts to a financial transaction agree to settle their respective obligations, i.e., exchanging payments. For spot currency transactions, the value date is normally two business days forward. Also known as maturity date. Variation Margin - Funds a broker must request from the client to have the required margin deposited. The term usually refers to additional funds that must be deposited as a result of unfavorable price movements.Page 10 of 11 www.Forex-trader.comVolatility (Vol) - A measure of price fluctuations. The standard deviation of a price series is commonly used to measure price volatility.Volume - represents the total amount of trading activity in a particular stock, commodity or index for that day. It is the total number of contracts traded during the day.WWeak Dollar/ Strong Dollar - dollar is said to be weak (relative to a previous time period) against another currency when more dollars are required to buy one unit of another currency. The dollar is strong or has gained in strength when fewer dollars are required to buy one unit of another currency. For example, if $1 buys 10 FF in 1989 but today $1 buys only 6 FF then the dollar has weakened against the franc.Whipsaw – slang for a condition of a highly volatile market where a sharp price movement is quickly followed by a sharp reversal.XY Yard – Slang for a billion.YIELD - Return on capital investment.Z________________
SPECIFICS OF THE STRATEGY
SPECIFICS OF THE STRATEGY
SPECIFICS OF THE STRATEGYNow, lets look at specifically how to apply this strategy. We willuse chart 1 for illustration purposes, and all times will bediscussed as EST. You go to view the FundamentalAnnouncement calendars and see that the US will be makingsome announcements (one announcement is ok, but more isbetter) for 8:30am tomorrow. Very well then, you go to bed andmake sure to have the alarm set for 8:15am to be awake for thetrading opportunity. It’s a good idea to set an alarm clock 15minutes before the trading opportunity to make sure youremember it.At 8:25 you should have your charts open to the one-minutecandlesticks for EUR/USD (and/or GBP/USD, CHF/USD) andyour Forex broker account opened up and ready to place anorder.You should notice that prices are gently moving around in aconsolidation pattern waiting for the Fundamental Announcement.Now here is where you have to act quickly. At EXACTLY 8:29amyou need to look at the candle and see what the high and lowprices are (not open and close). Add 10 pips to the high price andminus 10 pips from the low price. If the 8:28am candle has higherhighs or lower lows then you may want to use those extremenumbers instead of the 8:29am candle’s prices(adding/subtracting 10 pips). Now you create two “entry orders”.An entry order, unlike a market order to buy/sell right now at thecurrent price, is an order that only kicks in when your entry priceis touched. For the first entry order you set it to “BUY” when itreaches the high+10pips price, set your Stop loss for 10 pips(VERY IMPORTANT) which is basically the same as the highwithout the extra 10 pips, and then activate your trade. For theeBook 1 “Amazing FOREX System” - © 2004 Robert Borowski – www.AmazingForexSystem.comDuplication and distribution of this material is strictly forbidden23second entry order you set it to “SELL” when it reaches the low-10pips price, set your Stop loss for 10 pips (VERY IMPORTANT)which is basically the same as the low without the extra 10 pips,and then activate your trade. This should all have happened by8:30am sharp. OPTIONAL – you could set a profit limit of 20 pipson both orders.What did you just do? You took the price range of the currencypair and stretched it 10 pips up and down to add a little bit of asafety net. You told the broker that if the price of the currencypair goes up to that high point then you will “BUY”, and if it goesdown to the low point then you will “SELL”. You also told thebroker to stop you out after losing ten pips incase that shouldhappen. If you set the optional profit limit to 20 pips then you toldthe broker that once the price moves in your favor 20 pips to exitthe trade.In chart 1 it happened to go “UP”, and you would have ended up“BUYING” the currency pair. It could have just as well gone“DOWN”, and you would have ended up “SELLING” the currencypair. It doesn’t really matter with this strategy which way it goes,just that it moves a lot of pips.IMPORTANT – Within 5 minutes one of your two trades should beoff and running. At this point you should cancel the other trade.Sometimes the market responds with a momentary whiplashwhich means both orders could have been triggered, oneresulting in a loss while the other usually goes on for a profit.Read more about this later in this document.Let’s review the above chart 1 example. At 8:29am the high was1.2002 and the low was 1.1999. At 8:28am the high was 1.2000and the low 1.1998. Since the low of the 8:28am candle waseBook 1 “Amazing FOREX System” - © 2004 Robert Borowski – www.AmazingForexSystem.comDuplication and distribution of this material is strictly forbidden24lower than the 8:29am candle’s low we will use that one. So nowyou add 10 pips to the high (1.2002 + 10pips = 1.2012) and yousubtract 10 pips from the low (1.1998 –10pips = 1.1988). So youplace two entry orders, one that if the price goes to 1.2012 youbuy a lot (or multiple lots, or mini lots), but if the price drops to1.1988 you sell a lot. Then you enter your stop losses (VERYIMPORTANT – NEVER trade without stops!!!) of 10 pips, so foryour buy position your stop loss would be 1.2002 and your stopfor the sell position would be 1.1998. Let’s say you decided to puta profit limit of 20 pips then for your buy position it would be1.2032, and for your sell position it would be 1.1968.To make calculations simpler for you I have included an MS Excelspreadsheet that does all the math for you that you can downloadfrom the resource section of my website (see Appendix A). Justenter in your high and low numbers and it will give you all thenumbers needed.Back to the example. In this case your “BUY” entry order wouldhave kicked you in for a buy position at 1.2012. If you used a 20pip limit then you would have exited at 1.2032 for a nice $200profit (trading only one regular lot). Not bad for about five minutesworth of work.If you are a beginning trader it is highly recommended that youstick with a 20 pip limit on your trades. Later you can do some ofthe more advanced suggestions below.eBook 1 “Amazing FOREX System” - © 2004 Robert Borowski – www.AmazingForexSystem.comDuplication and distribution of this material is strictly forbidden25CHARTSFor this strategy you will need access to real time charts. YourForex broker should offer you some free charts, and this is all youneed. I provide links to brokers and free charts on my website(see Appendix A). You should use the charts provided by yourbroker as those will reflect the actual trading prices of your broker,and sometimes different brokers/charts have a slight pricediscrepancy which could throw off the system for you. The freecharts are all you really need, so save your money, you don’tneed to purchase the “Pro” charts.What you will need to do is access the chart for the currency pairyou are interested in trading. Make sure that the chart is showing“Candles” rather than other types of charts. Change your view toshow you 1-minute candles. This means that each candle showsthe price action of one-minute increments. You may want tozoom in to get a clear view of the most recent candles, which areon the right of the screen. When you mouse over a candle noticethat somewhere it should display to you the opening price, highprice, low price and close price, along with the date and time ofthat candle. Remember, it’s the high and low prices, and the timeof the candle that is most important for you to read to work thisstrategy. Spend some time playing with your charts getting reallyfamiliar doing this so that when you’ll be in the time crunch ofplacing your trade you won’t be fumbling around trying to figurethings out.
SPECIFICS OF THE STRATEGYNow, lets look at specifically how to apply this strategy. We willuse chart 1 for illustration purposes, and all times will bediscussed as EST. You go to view the FundamentalAnnouncement calendars and see that the US will be makingsome announcements (one announcement is ok, but more isbetter) for 8:30am tomorrow. Very well then, you go to bed andmake sure to have the alarm set for 8:15am to be awake for thetrading opportunity. It’s a good idea to set an alarm clock 15minutes before the trading opportunity to make sure youremember it.At 8:25 you should have your charts open to the one-minutecandlesticks for EUR/USD (and/or GBP/USD, CHF/USD) andyour Forex broker account opened up and ready to place anorder.You should notice that prices are gently moving around in aconsolidation pattern waiting for the Fundamental Announcement.Now here is where you have to act quickly. At EXACTLY 8:29amyou need to look at the candle and see what the high and lowprices are (not open and close). Add 10 pips to the high price andminus 10 pips from the low price. If the 8:28am candle has higherhighs or lower lows then you may want to use those extremenumbers instead of the 8:29am candle’s prices(adding/subtracting 10 pips). Now you create two “entry orders”.An entry order, unlike a market order to buy/sell right now at thecurrent price, is an order that only kicks in when your entry priceis touched. For the first entry order you set it to “BUY” when itreaches the high+10pips price, set your Stop loss for 10 pips(VERY IMPORTANT) which is basically the same as the highwithout the extra 10 pips, and then activate your trade. For theeBook 1 “Amazing FOREX System” - © 2004 Robert Borowski – www.AmazingForexSystem.comDuplication and distribution of this material is strictly forbidden23second entry order you set it to “SELL” when it reaches the low-10pips price, set your Stop loss for 10 pips (VERY IMPORTANT)which is basically the same as the low without the extra 10 pips,and then activate your trade. This should all have happened by8:30am sharp. OPTIONAL – you could set a profit limit of 20 pipson both orders.What did you just do? You took the price range of the currencypair and stretched it 10 pips up and down to add a little bit of asafety net. You told the broker that if the price of the currencypair goes up to that high point then you will “BUY”, and if it goesdown to the low point then you will “SELL”. You also told thebroker to stop you out after losing ten pips incase that shouldhappen. If you set the optional profit limit to 20 pips then you toldthe broker that once the price moves in your favor 20 pips to exitthe trade.In chart 1 it happened to go “UP”, and you would have ended up“BUYING” the currency pair. It could have just as well gone“DOWN”, and you would have ended up “SELLING” the currencypair. It doesn’t really matter with this strategy which way it goes,just that it moves a lot of pips.IMPORTANT – Within 5 minutes one of your two trades should beoff and running. At this point you should cancel the other trade.Sometimes the market responds with a momentary whiplashwhich means both orders could have been triggered, oneresulting in a loss while the other usually goes on for a profit.Read more about this later in this document.Let’s review the above chart 1 example. At 8:29am the high was1.2002 and the low was 1.1999. At 8:28am the high was 1.2000and the low 1.1998. Since the low of the 8:28am candle waseBook 1 “Amazing FOREX System” - © 2004 Robert Borowski – www.AmazingForexSystem.comDuplication and distribution of this material is strictly forbidden24lower than the 8:29am candle’s low we will use that one. So nowyou add 10 pips to the high (1.2002 + 10pips = 1.2012) and yousubtract 10 pips from the low (1.1998 –10pips = 1.1988). So youplace two entry orders, one that if the price goes to 1.2012 youbuy a lot (or multiple lots, or mini lots), but if the price drops to1.1988 you sell a lot. Then you enter your stop losses (VERYIMPORTANT – NEVER trade without stops!!!) of 10 pips, so foryour buy position your stop loss would be 1.2002 and your stopfor the sell position would be 1.1998. Let’s say you decided to puta profit limit of 20 pips then for your buy position it would be1.2032, and for your sell position it would be 1.1968.To make calculations simpler for you I have included an MS Excelspreadsheet that does all the math for you that you can downloadfrom the resource section of my website (see Appendix A). Justenter in your high and low numbers and it will give you all thenumbers needed.Back to the example. In this case your “BUY” entry order wouldhave kicked you in for a buy position at 1.2012. If you used a 20pip limit then you would have exited at 1.2032 for a nice $200profit (trading only one regular lot). Not bad for about five minutesworth of work.If you are a beginning trader it is highly recommended that youstick with a 20 pip limit on your trades. Later you can do some ofthe more advanced suggestions below.eBook 1 “Amazing FOREX System” - © 2004 Robert Borowski – www.AmazingForexSystem.comDuplication and distribution of this material is strictly forbidden25CHARTSFor this strategy you will need access to real time charts. YourForex broker should offer you some free charts, and this is all youneed. I provide links to brokers and free charts on my website(see Appendix A). You should use the charts provided by yourbroker as those will reflect the actual trading prices of your broker,and sometimes different brokers/charts have a slight pricediscrepancy which could throw off the system for you. The freecharts are all you really need, so save your money, you don’tneed to purchase the “Pro” charts.What you will need to do is access the chart for the currency pairyou are interested in trading. Make sure that the chart is showing“Candles” rather than other types of charts. Change your view toshow you 1-minute candles. This means that each candle showsthe price action of one-minute increments. You may want tozoom in to get a clear view of the most recent candles, which areon the right of the screen. When you mouse over a candle noticethat somewhere it should display to you the opening price, highprice, low price and close price, along with the date and time ofthat candle. Remember, it’s the high and low prices, and the timeof the candle that is most important for you to read to work thisstrategy. Spend some time playing with your charts getting reallyfamiliar doing this so that when you’ll be in the time crunch ofplacing your trade you won’t be fumbling around trying to figurethings out.
all forex terms
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beggining
beggining
BEGINNINGCongratulations for purchasing this report. You have made a verywise choice to buy this eBook as in it you will learn a trulyamazing system to trade in the Forex markets. You will learn howto make an easy $200 to $1,500, or even more, consistently andreliably, with minimal risk, working only about ten minutes eachday!This small eBook is worth more than “it’s weight in gold”… oreven platinum. Your first successful trade using this system willmore than recover what you have paid for it, and you will be wellon your way to great financial gains.It doesn’t matter if you are a complete beginner or if you are anadvanced Forex trader. This system is so easy to understandand to follow that a beginner can profit from it without much of anyunderstanding about how the Forex market works. This eBookwill even explain some of the things a beginner needs to know,assuming they know nothing. If you are an advanced Forextrader then this system can be easily integrated into your existing“trading tool-box” of tricks you normally use. You may continuedoing whatever else you have been doing and still profit from thisinformation to increase your percentage gains. If you are anadvanced Forex trader then you will simply get a little review ofsome familiar concepts while learning the strategies used here.NOW, LET’S GET STARTED!Here is the basic concept of how this strategy works. After thisbrief overview I will explain a lot more in a lot more detail. Forthose of you who are beginners, if you get confused with any ofthe terms in this brief overview then don’t worry about it, I’lleBook 1 “Amazing FOREX System” - © 2004 Robert Borowski – www.AmazingForexSystem.comDuplication and distribution of this material is strictly forbidden4explain better later. This is intended to provide an overview of thetrading strategy.For over a year of trading and watching the Forex markets Inoticed something interesting, which anyone who pays attentionto the markets should have noticed. Usually everyday, and oftenmore than once a day, the currency pair will be moving alongslowly (sideways movement, consolidation) and then all of asudden it JUMPS! It very quickly moves up ten or more pips,usually in just a minute, and often continues to move strongly foranother hour or so.This is due to the release of a “Fundamental Announcement”, andof course any experienced trader should understand that theyusually create a market movement.I’ve played around trying to capitalize on these movements, andover time have come up with the perfect strategy to do just that. Idon’t know why somebody hasn’t come up with this strategybefore. Maybe some traders out there have figured this out, but Idon’t know of anyone who is selling this strategy. Either they arejealously keeping the secret to themselves, or they are so busywith the hundreds of other more complicated systems that theysimply overlooked this simple yet powerful strategy.Note added after initial release of this eBook:I did independently invent the system I’m presenting here; never having heard of anyonedoing anything similar. Since the release of this eBook I have encountered a few very“experienced” traders who have used a similar variation of this technique. So now I amaware of the fact that a few others are “clued in” on this kind of strategy, but am pleasedto say that I’ve been told that though they were aware of the general idea they loved theSPECIFICS I go into explaining EXACTLY HOW to do this with “razor precision”. Mostpeople who already got this eBook expressed amazement at how simply powerful thissystem is, and wondered why they never thought of it or heard of it themselves (and thisis said by experienced traders). I’m pleased to say that many people wrote to me toexpress their gratitude and that they are very impressed with this system.eBook 1 “Amazing FOREX System” - © 2004 Robert Borowski – www.AmazingForexSystem.comDuplication and distribution of this material is strictly forbidden5Basically, you find out when Fundamental Announcements aredue to be released and then just a minute before the release timeyou set up two entry orders go either long or short so when themarket explodes in either direction (you really don’t care whichway it goes) you are in for a profitable ride. Typically the marketmoves 30 to 60 pips when this happens, but frequently it goes100 or more pips!If you don’t plan on baby-sitting your computer to watch and setup a larger pip gain you could simply set up a limit of 20 pips,which means you’ll likely be out of the market in about one tofifteen minutes (profit around $200 or more if you trade multiplelots, i.e. 5 lots would net around $1,000). Not bad consideringyour personal time invested this way is only about 10 minutes!Now, if you have the time to baby-sit your computer you couldeasily set up strategically placed stops to capture even more pips.We’ll explain how to do this shortly.Now here is the best part – you risk only 10 pips for your stoploss, and your trades have a very high percentage of wins!Considering that you typically set up your trades with a stop of 20to 60 pips this alone is amazing. Thus your risk with this systemtruly is minimal. If you trade this system with only a 20 pip limityour limit-to-stop ratio is 2:1, and if you do the “baby-sitting” thingwhere you can easily capture 40 to 150 pips then your ratio goesto 4:1 to 15:1.Now, if this didn’t get you excited then you better check yourpulse because this is truly an impressive system toconsistently earn you awesome gains!
BEGINNINGCongratulations for purchasing this report. You have made a verywise choice to buy this eBook as in it you will learn a trulyamazing system to trade in the Forex markets. You will learn howto make an easy $200 to $1,500, or even more, consistently andreliably, with minimal risk, working only about ten minutes eachday!This small eBook is worth more than “it’s weight in gold”… oreven platinum. Your first successful trade using this system willmore than recover what you have paid for it, and you will be wellon your way to great financial gains.It doesn’t matter if you are a complete beginner or if you are anadvanced Forex trader. This system is so easy to understandand to follow that a beginner can profit from it without much of anyunderstanding about how the Forex market works. This eBookwill even explain some of the things a beginner needs to know,assuming they know nothing. If you are an advanced Forextrader then this system can be easily integrated into your existing“trading tool-box” of tricks you normally use. You may continuedoing whatever else you have been doing and still profit from thisinformation to increase your percentage gains. If you are anadvanced Forex trader then you will simply get a little review ofsome familiar concepts while learning the strategies used here.NOW, LET’S GET STARTED!Here is the basic concept of how this strategy works. After thisbrief overview I will explain a lot more in a lot more detail. Forthose of you who are beginners, if you get confused with any ofthe terms in this brief overview then don’t worry about it, I’lleBook 1 “Amazing FOREX System” - © 2004 Robert Borowski – www.AmazingForexSystem.comDuplication and distribution of this material is strictly forbidden4explain better later. This is intended to provide an overview of thetrading strategy.For over a year of trading and watching the Forex markets Inoticed something interesting, which anyone who pays attentionto the markets should have noticed. Usually everyday, and oftenmore than once a day, the currency pair will be moving alongslowly (sideways movement, consolidation) and then all of asudden it JUMPS! It very quickly moves up ten or more pips,usually in just a minute, and often continues to move strongly foranother hour or so.This is due to the release of a “Fundamental Announcement”, andof course any experienced trader should understand that theyusually create a market movement.I’ve played around trying to capitalize on these movements, andover time have come up with the perfect strategy to do just that. Idon’t know why somebody hasn’t come up with this strategybefore. Maybe some traders out there have figured this out, but Idon’t know of anyone who is selling this strategy. Either they arejealously keeping the secret to themselves, or they are so busywith the hundreds of other more complicated systems that theysimply overlooked this simple yet powerful strategy.Note added after initial release of this eBook:I did independently invent the system I’m presenting here; never having heard of anyonedoing anything similar. Since the release of this eBook I have encountered a few very“experienced” traders who have used a similar variation of this technique. So now I amaware of the fact that a few others are “clued in” on this kind of strategy, but am pleasedto say that I’ve been told that though they were aware of the general idea they loved theSPECIFICS I go into explaining EXACTLY HOW to do this with “razor precision”. Mostpeople who already got this eBook expressed amazement at how simply powerful thissystem is, and wondered why they never thought of it or heard of it themselves (and thisis said by experienced traders). I’m pleased to say that many people wrote to me toexpress their gratitude and that they are very impressed with this system.eBook 1 “Amazing FOREX System” - © 2004 Robert Borowski – www.AmazingForexSystem.comDuplication and distribution of this material is strictly forbidden5Basically, you find out when Fundamental Announcements aredue to be released and then just a minute before the release timeyou set up two entry orders go either long or short so when themarket explodes in either direction (you really don’t care whichway it goes) you are in for a profitable ride. Typically the marketmoves 30 to 60 pips when this happens, but frequently it goes100 or more pips!If you don’t plan on baby-sitting your computer to watch and setup a larger pip gain you could simply set up a limit of 20 pips,which means you’ll likely be out of the market in about one tofifteen minutes (profit around $200 or more if you trade multiplelots, i.e. 5 lots would net around $1,000). Not bad consideringyour personal time invested this way is only about 10 minutes!Now, if you have the time to baby-sit your computer you couldeasily set up strategically placed stops to capture even more pips.We’ll explain how to do this shortly.Now here is the best part – you risk only 10 pips for your stoploss, and your trades have a very high percentage of wins!Considering that you typically set up your trades with a stop of 20to 60 pips this alone is amazing. Thus your risk with this systemtruly is minimal. If you trade this system with only a 20 pip limityour limit-to-stop ratio is 2:1, and if you do the “baby-sitting” thingwhere you can easily capture 40 to 150 pips then your ratio goesto 4:1 to 15:1.Now, if this didn’t get you excited then you better check yourpulse because this is truly an impressive system toconsistently earn you awesome gains!
LOOKING AT THE CALENDAR
LOOKING AT THE CALENDAR
LOOKING AT THE CALENDARThe resources section of my website provides links to a couple ofFundamental Announcement calendars (see Appendix A).Every day is different, with different countries posted to releaseannouncements. Often you will see the same country makingmultiple announcements for the same time. This is the bestsetup as when there are multiple announcements happeningsimultaneously then the market is much more likely to reactstrongly. One danger is that if there are multiple announcementsthen there is a greater chance of whiplash happening (more aboutwhiplash later).You could also trade when there is only one announcement at aparticular time from a particular country, however it becomes lesslikely that you’ll see a major price move. Generally it is best ifthere are two or more at the same time.You should also pay attention to what the announcement appearsto be. Release of key economic figures seems to generate moreaction than speeches (generally). Really, it’s difficult to sayexactly what creates strong reactions, but after practicing for awhile you should get a feel for what to expect.At the end of this section I provide you a list of “key”announcement types to pay attention to. See section titled “KeyAnnouncements”.Furthermore, economic figures released in the morning time ofthat particular market seem to have more impact than later ones;announcements that happen early during market overlap timestend to be best (more about market overlap later).eBook 1 “Amazing FOREX System” - © 2004 Robert Borowski – www.AmazingForexSystem.comDuplication and distribution of this material is strictly forbidden20Look at what is posted for the next day to plan accordingly;deciding what time(s) seem to offer the best opportunity, andwhich currency pair you plan to trade at that time.Set your plan in advance and you should have better success,simply because you can plan to be ready to trade for those timesand you’ll be thinking clearer about how to proceed with the trade.What you might want to do (highly recommended) is to review theupcoming week in the Fundamental Announcements calendarduring the weekend, and write out a plan for the week detailingthe exact times you plan to trade and on which currency pairs.The ten minutes spent doing this separates you from novicetraders, showing you are a professional quality trader that takesthe time to properly plan your trades, and then trade your plan.KEY ANNOUNCEMENTSThere are certain Fundamental Announcements that are muchmore likely to result in strong movements. If there is uncertainty(good for your trading) about what the announcement will be thenthere will be an immediate and often drastic effect on the currencymarket (more drastic news = more drastic price move).The most important to watch for are Unemployment Reports, andInterest Rates. Also high on the list to look for are ConsumerPrice Index (CPI), Inflation, and Gross Domestic Product(GDP). Less important (meaning less likely to result in the jumpsyou are looking for) but still worth keeping an eye on include M2(Money Supply), Treasury Budget, Producer Price Index (PPI),Retail Sales, and International Trade.
LOOKING AT THE CALENDARThe resources section of my website provides links to a couple ofFundamental Announcement calendars (see Appendix A).Every day is different, with different countries posted to releaseannouncements. Often you will see the same country makingmultiple announcements for the same time. This is the bestsetup as when there are multiple announcements happeningsimultaneously then the market is much more likely to reactstrongly. One danger is that if there are multiple announcementsthen there is a greater chance of whiplash happening (more aboutwhiplash later).You could also trade when there is only one announcement at aparticular time from a particular country, however it becomes lesslikely that you’ll see a major price move. Generally it is best ifthere are two or more at the same time.You should also pay attention to what the announcement appearsto be. Release of key economic figures seems to generate moreaction than speeches (generally). Really, it’s difficult to sayexactly what creates strong reactions, but after practicing for awhile you should get a feel for what to expect.At the end of this section I provide you a list of “key”announcement types to pay attention to. See section titled “KeyAnnouncements”.Furthermore, economic figures released in the morning time ofthat particular market seem to have more impact than later ones;announcements that happen early during market overlap timestend to be best (more about market overlap later).eBook 1 “Amazing FOREX System” - © 2004 Robert Borowski – www.AmazingForexSystem.comDuplication and distribution of this material is strictly forbidden20Look at what is posted for the next day to plan accordingly;deciding what time(s) seem to offer the best opportunity, andwhich currency pair you plan to trade at that time.Set your plan in advance and you should have better success,simply because you can plan to be ready to trade for those timesand you’ll be thinking clearer about how to proceed with the trade.What you might want to do (highly recommended) is to review theupcoming week in the Fundamental Announcements calendarduring the weekend, and write out a plan for the week detailingthe exact times you plan to trade and on which currency pairs.The ten minutes spent doing this separates you from novicetraders, showing you are a professional quality trader that takesthe time to properly plan your trades, and then trade your plan.KEY ANNOUNCEMENTSThere are certain Fundamental Announcements that are muchmore likely to result in strong movements. If there is uncertainty(good for your trading) about what the announcement will be thenthere will be an immediate and often drastic effect on the currencymarket (more drastic news = more drastic price move).The most important to watch for are Unemployment Reports, andInterest Rates. Also high on the list to look for are ConsumerPrice Index (CPI), Inflation, and Gross Domestic Product(GDP). Less important (meaning less likely to result in the jumpsyou are looking for) but still worth keeping an eye on include M2(Money Supply), Treasury Budget, Producer Price Index (PPI),Retail Sales, and International Trade.
basic
basic
soyour $1,400 CAD would convert back to $1,021.89 US (again,ignore bank spreads/commissions). Therefore you just made$21.89, a 2.19% increase in funds (not bad).In the Forex market you could have simply traded the “CurrencyPair” called USD/CAD, first selling USD for CAD, and then laterbuying back USD with the CAD you have. Basically, you aretrading one currency for the other.Usually currencies are traded against the US dollar (USD), so youmay be trading the US dollar against the Euro (EUR), BritishPound (GBP), Swiss Franc (CHF), Japanese Yen (JPY),Australian Dollar (AUD), New Zealand Dollar (NZD), and ofcourse Canadian Dollar (CAD). There are other currency pairs,but you normally won’t be dealing with those.eBook 1 “Amazing FOREX System” - © 2004 Robert Borowski – www.AmazingForexSystem.comDuplication and distribution of this material is strictly forbidden7When you are trading you are attempting to capture “PIPs” (PriceInterest Points), which is one/one-hundredth of a cent (fordollars). You will notice that the exchange has two extra decimalsat the end. From our example above, there is a one-pipdifference between 1.4000 and 1.4001.One pip may not seem like much, but when you are trading largevolumes of currency, say $100,000, then one pip times 100,000 isequal to $10 (less on certain currency pairs). When you aretrading currencies the broker gives you typically a 100:1 ratiomeaning that to “control” one lot of $100,000 all you need is$1,000 on margin.Thus, as has been explained before, when you capture 20 pipsfrom this amazing trading system then that means you have justearned $200.Now, if you don’t have at least $2,000 to open a regular Forextrading account, or can’t afford potential 10 pip losses, then youmay want to consider a “mini” account. Most online brokers offermini trading accounts that you can open for as little as $300. Witha mini account you are trading lot sizes one-tenth of a regular lot(10,000 vs. 100,000), with risk being one-tenth as well as yourrewards one-tenth. Trading a mini account means that 1 pipequals roughly $1. If this is the only way you can afford to starttrading then open a mini account. Remember, as your accountquickly grows you can trade multiple mini lots, and trading tenmini lots is the same as trading one regular lot. You could open amini account with say $300 and experience 100% to 200% gainsin your first month, quickly building your account to be able totrade larger lot sizes.eBook 1 “Amazing FOREX System” - © 2004 Robert Borowski – www.AmazingForexSystem.comDuplication and distribution of this material is strictly forbidden8Please remember to exercise good equity management in all yourtrades, never risking more than 2% of your margin account on anysingle trade, however if you have a small mini account you maybend this rule to 5%. For example, if you have $300 in youraccount, 2% is $6, equal to 6 pips loss. Realistically you need tobe prepared to suffer 10 pip losses with this system, so obviouslyyour risk per trade has to be a bit higher than professional traderswould normally employ. Once you get your account to $600 ormore then definitely limit your risk to only 2% of your marginaccount on any single trade. Don’t be greedy and you’ll survive afew losses to continue your gains. Please don’t trade money youcan’t afford to loose.If you need more explanations about any of the above then simplysurf the web a little, particularly looking at online Forex brokerswebsites as there you should be able to learn more about thebasics of how currency pairs work, or enroll in a good Forextraining program to make sure you understand all this. I havealso included valuable bonus you can download from theResources website (see Appendix A) that gives you a lot of Forextraining, and should answer your questions (I’ve had over $10,000worth of Forex training and can say with knowledge that theresources I’ve provided you there will teach you everything youneed to know).A couple more things before we continue with explaining thisamazing trading system. You should have the following threethings already set up. (1) An actual trading account with realmoney in it, (2) a demo trading account with fake money in it, and(3) access to charts. I would personally recommend opening upan account with one of my recommended brokers (listed in theResources Section – see Appendix A), however any of the othermajor brokers may do, or whatever favorite you have. (Important – ineBook 1 “Amazing FOREX System” - © 2004 Robert Borowski – www.AmazingForexSystem.comDuplication and distribution of this material is strictly forbidden9the Resources Section I explain certain important criteria to evaluate your broker to see whetherthey’ll be good to use in conjunction with this system. It is preferable though to use one of therecommended brokers) They will also provide you free charts that will bemore than good enough for the purposes of this strategy. Youdon’t need expensive charts; the free ones really are all you need.It is best to use charts provided by your broker as the Forexmarket is decentralized and the trading rates differ slightly frombroker to broker, and for this strategy you need accurate pricesbased on your broker’s dealing rates to succeed.There is a special member’s only section on my website that haslinks to all the resources you will need to work with this program,including where to get accounts and charts. (See Appendix A)Before you commit any real money to trading this strategy youshould practice it for at least ten successful trades to make sureyou understand everything perfectly. Go to a broker website andregister for a free demo account, preferably with the company youactually use or plan to use for your real trades. You can registerfor a regular demo account if you plan to trade regular lots asexplained above, or register for a mini demo account if you plan tostart with a mini account. In your demo account you can practicemaking trades in real-time without worrying about losing any realmoney.Make sure to play around with making trades in your demoaccount, don’t worry about making losses, just practice enteringtrades to get familiar with the steps to entering a trade. You don’twant to miss out on a great trading opportunity because you don’tknow how to enter a trade. Also play around getting familiar withyour charts. I will explain shortly how you will use them.
soyour $1,400 CAD would convert back to $1,021.89 US (again,ignore bank spreads/commissions). Therefore you just made$21.89, a 2.19% increase in funds (not bad).In the Forex market you could have simply traded the “CurrencyPair” called USD/CAD, first selling USD for CAD, and then laterbuying back USD with the CAD you have. Basically, you aretrading one currency for the other.Usually currencies are traded against the US dollar (USD), so youmay be trading the US dollar against the Euro (EUR), BritishPound (GBP), Swiss Franc (CHF), Japanese Yen (JPY),Australian Dollar (AUD), New Zealand Dollar (NZD), and ofcourse Canadian Dollar (CAD). There are other currency pairs,but you normally won’t be dealing with those.eBook 1 “Amazing FOREX System” - © 2004 Robert Borowski – www.AmazingForexSystem.comDuplication and distribution of this material is strictly forbidden7When you are trading you are attempting to capture “PIPs” (PriceInterest Points), which is one/one-hundredth of a cent (fordollars). You will notice that the exchange has two extra decimalsat the end. From our example above, there is a one-pipdifference between 1.4000 and 1.4001.One pip may not seem like much, but when you are trading largevolumes of currency, say $100,000, then one pip times 100,000 isequal to $10 (less on certain currency pairs). When you aretrading currencies the broker gives you typically a 100:1 ratiomeaning that to “control” one lot of $100,000 all you need is$1,000 on margin.Thus, as has been explained before, when you capture 20 pipsfrom this amazing trading system then that means you have justearned $200.Now, if you don’t have at least $2,000 to open a regular Forextrading account, or can’t afford potential 10 pip losses, then youmay want to consider a “mini” account. Most online brokers offermini trading accounts that you can open for as little as $300. Witha mini account you are trading lot sizes one-tenth of a regular lot(10,000 vs. 100,000), with risk being one-tenth as well as yourrewards one-tenth. Trading a mini account means that 1 pipequals roughly $1. If this is the only way you can afford to starttrading then open a mini account. Remember, as your accountquickly grows you can trade multiple mini lots, and trading tenmini lots is the same as trading one regular lot. You could open amini account with say $300 and experience 100% to 200% gainsin your first month, quickly building your account to be able totrade larger lot sizes.eBook 1 “Amazing FOREX System” - © 2004 Robert Borowski – www.AmazingForexSystem.comDuplication and distribution of this material is strictly forbidden8Please remember to exercise good equity management in all yourtrades, never risking more than 2% of your margin account on anysingle trade, however if you have a small mini account you maybend this rule to 5%. For example, if you have $300 in youraccount, 2% is $6, equal to 6 pips loss. Realistically you need tobe prepared to suffer 10 pip losses with this system, so obviouslyyour risk per trade has to be a bit higher than professional traderswould normally employ. Once you get your account to $600 ormore then definitely limit your risk to only 2% of your marginaccount on any single trade. Don’t be greedy and you’ll survive afew losses to continue your gains. Please don’t trade money youcan’t afford to loose.If you need more explanations about any of the above then simplysurf the web a little, particularly looking at online Forex brokerswebsites as there you should be able to learn more about thebasics of how currency pairs work, or enroll in a good Forextraining program to make sure you understand all this. I havealso included valuable bonus you can download from theResources website (see Appendix A) that gives you a lot of Forextraining, and should answer your questions (I’ve had over $10,000worth of Forex training and can say with knowledge that theresources I’ve provided you there will teach you everything youneed to know).A couple more things before we continue with explaining thisamazing trading system. You should have the following threethings already set up. (1) An actual trading account with realmoney in it, (2) a demo trading account with fake money in it, and(3) access to charts. I would personally recommend opening upan account with one of my recommended brokers (listed in theResources Section – see Appendix A), however any of the othermajor brokers may do, or whatever favorite you have. (Important – ineBook 1 “Amazing FOREX System” - © 2004 Robert Borowski – www.AmazingForexSystem.comDuplication and distribution of this material is strictly forbidden9the Resources Section I explain certain important criteria to evaluate your broker to see whetherthey’ll be good to use in conjunction with this system. It is preferable though to use one of therecommended brokers) They will also provide you free charts that will bemore than good enough for the purposes of this strategy. Youdon’t need expensive charts; the free ones really are all you need.It is best to use charts provided by your broker as the Forexmarket is decentralized and the trading rates differ slightly frombroker to broker, and for this strategy you need accurate pricesbased on your broker’s dealing rates to succeed.There is a special member’s only section on my website that haslinks to all the resources you will need to work with this program,including where to get accounts and charts. (See Appendix A)Before you commit any real money to trading this strategy youshould practice it for at least ten successful trades to make sureyou understand everything perfectly. Go to a broker website andregister for a free demo account, preferably with the company youactually use or plan to use for your real trades. You can registerfor a regular demo account if you plan to trade regular lots asexplained above, or register for a mini demo account if you plan tostart with a mini account. In your demo account you can practicemaking trades in real-time without worrying about losing any realmoney.Make sure to play around with making trades in your demoaccount, don’t worry about making losses, just practice enteringtrades to get familiar with the steps to entering a trade. You don’twant to miss out on a great trading opportunity because you don’tknow how to enter a trade. Also play around getting familiar withyour charts. I will explain shortly how you will use them.
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