Before you read this article, Please read What is Forex Trading if you are new on Forex Trading. Your chance to success in Forex Trading is greatly helped by the presence of an article about forex in the internet. much better if you have a mentor on your side. If you do not have a mentor, and want to learn autodidact, make sure you are people who want to learn. Forex Trading can only be succeed if you want to learn and are not easily discouraged.
Forecasting Forex use Matemathic method:
Statistics approach is used because it can estimate the trend of price movements using past data. Is data the past can provide predictions accurate enough chances movement? The answer is yes, as long as there is no fundamental news trading a big impact. When approaching important news announcements associated with a single currency, there are times when technical analysis is not accurate.
Why? Keep in mind that forex market players are generally divided into 2 large traders and retail. Traders are large financial institutions, banks, or the big boys who have very large capital (in total hold around 80% of funds from the market). Trader retail trader is small but holds a huge amount of funds only about 20% of the funds from the market. Since currency prices are influenced by supply and demand laws of economics, the role of the trader is able to move the price as they do heavy trading. This is what makes trading more accurate fundamental news announcements while approaching the economy, and when the effect of the news began to fade, technical trading takes over.
Trade the News Method
We as a small trader can gain profit if you follow the trend of big players. Some traders even have access to information behind the line of people in the big traders when making transactions. Traders who do not have access to this kind usually use fast execution trading platform to enter the market shortly after the news was announced. This technique is called “trade the news”. The weakness of this technique is the need of information from news sources that can provide information on the results of the news is very FAST, for example, a few seconds before the general public receives the same information so that news traders to enter the market before the price movement occurs. Service information quickly news of this kind cost hundreds to thousands of dollars per month (Reuters, Bloomberg, etc.). It also needed a quick response and trader of high risk when the market moves against the trader’s position.
Trader retail trading is usually done with the help of a technical indicator which uses Statistics and Mathematical calculations, even with the support of behavioral psychology. When appropriate in a technical trade is when the market tend to be quiet and no important news.
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