Why Mini Forex Trading Is Important For New Traders

By Bart Icles

For any new investor to have a successful career in Forex currency trading, they have to start out in the right direction by investing in a Forex mini account. A mini account is different from the Forex standard account in terms of initial investment capitalization. This type of account can be started with only $200 - $250, with some even lower with other account handlers. A standard Forex account, at the most, requires at least $2,000 - $2,500 to begin with. The advantage of a mini account is that any investor can still do normal trading with the same privileges of that of the standard account without being burdened with a high initial investment requirement.

A mini Forex account is conveniently set at only one-tenth the lot size of a regular Forex account. Its Pip values are also given the same percentage number. The standard Forex account is given the lot size amounting to 10,000 units of the base currency, or as example would the USD which corresponding amount would be $10,000.

A Forex mini account trading is ideal for investors with little capital investments. This means that mini account traders have to engage in marginal trading or leverage trading. Leverage trading is borrowing money to do trading but without having to put up the full required amount for a single lot. The capital that is used apart from this amount is known as a margin lot. The marginal lot for a mini account of $10,000 is $50, or a ratio of 200:1. So if you start with an amount of $250, this is equal to five mini lots.

It's not advisable to take on a large amount of leverage, especially in a standard Forex trading account where losses can mean in the thousands of dollars. But in mini Forex trading, this is just the right way to go since it is not viewed as over-leveraging, since the risk factor is much lower due to its 200: 1 ratio. This lets any investor make more profitable and successful trading in dealing with lesser amount and knowing that when losses do happen, it'll be in lesser amounts. Standard Forex accounts are more complicated to handle which may not be right for the neophyte investor, who at the most may lack the right knowledge and tools for such transactions.

If you want to invest in Forex trading with amounts not greater than $5,000 - $10,000, then go with a Mini Forex account. You'll have a better chance of staying longer in the market and without over-leveraging when you do multiple currency trades. - 23222

About the Author:

Is automated forex trading misleading? What is forex trading? Come visit our blog to find out the answers to these questions and more.

How Learning to Trade Commodities Could Help You Become a Better Commodity Trader

By William Davies

When you start learning to trade commodities you will find yourself seeing commodity futures trading in a completely new light. Whether it is in a particular sector such as coal or copper or maybe across the whole range of commodity markets, your knowledge of these trading products will grow. Many have heard the mention of the New York Mercantile Exchange and crude oil trading against the background of a growing energy security concern and how many factors influence prices. Consider also what are the driving forces of prices in gold, palladium and other precious metals, and why do sugar prices spike?

You need to make an effort to find a very good commodities training school if you want to thrive in these markets. So what should you do to learn about commodity trading? Have you figured out the must know areas if you are to make a success in world commodity markets? It may help in the first instance to find locations where courses on trading commodities are offered. You may find you have a choice, either studying at home as part of an online training package or go to a high quality learning centre where students will have intense exposure to all aspects of futures and commodities.

Why should you choose to go to a commodity trading school? One advantage is immediate face to face contact with your coaches and you might be able to have one to one coaching. Your tutors may well have real world trading experience under their belts, and may indeed still be active commodity traders. If so you will really want to use their knowledge to the full. Also you can share thoughts with colleagues as you network with them after the course.

Learning on location lets you watch and learn from live trades with your coaches, who may trade in real time as you look over their shoulder. This is valuable as it helps to explain in a live setting what you may have learnt in elsewhere in theory. Such examples are valuable as they bring a real, sharp edge to your commodity trading education, and the tutors will help you as you create a personalised commodity trading plan. With the growth in trading centres, training providers now have locations globally and you may find one close to you, such as in London, Singapore, Dubai and Toronto, as well as major US centres such as Washington, Philadelphia, Chicago and New York.

Let's look at the alternative of training courses for commodity trading online. What are the benfefits here? If your commitments mean you cannot get to a centre when the courses run or you live too far from the location, the online version is ideal. When you take up this option you have maximum flexibility and you cover both technical and fundamental aspects of trading.

These online commodity trading courses will have offer e mail contact with your tutors, as well as video tutorials, using charts, blogs and forums. You will also most likely have access to special software packages allowing you to practice trades and use different trading techniques, as well as CDs and DVDs covering the key learning points.

So you are about to start learning to trade commodities. What will be covered? Broadly speaking, courses focus on fundamental analysis, that is supply and demand for commodities and how these are affected by inflation and in the case of crops, weather patterns. Traders also use technical analysis to compliment the former approach. This includes looking at commodity charts for price action, using techniques like Fibonacci numbers, Japanese candlesticks, moving averages, volume and support and resistance lines.

The course is likely to show you what a commodity futures contract is and how easy it is to trade electronically, how you place your futures order and set your commodity futures margin, as well as understand how hedging in commodity trading works. The whole area of risk management and preservation of capital is also an important aspect of learning, as is the psychology of trading and having a commodity trading plan. All these basic areas will be covered when you start learning to trade commodities. - 23222

About the Author:

The author, William Davies, contributes articles for a blog on Commodities Trading, offering an informational resource for those wanting to learn more about markets. Discover how you could start learning to trade commodities here.

Decreased Volatility Breakout (Part I)

By Ahmad Hassam

Without understanding the crowd psychology, you cannot become a successful trader. Always try to understand the crowd psychology. Trading breakouts is one of the most popular ways of making pips from the forex market. Decreased volatility breakout is one of the subsets of breakout trading. While this strategy is similar to the strategy of trading breakouts, but it is specific to a certain conditions in the forex market. With this strategy, you try to take advantage of periods of low volatility in the forex market.

Volatility tends to be high when prices change to a large extent within a short span of time. Volatility is a measure of the scale of price fluctuations over time. The reverse also holds when prices oscillate more or less close to a certain price level without deviating much from it over a long span of time, the volatility tends to be low during such periods.

Entering the forex market in periods of high volatility can be stressful for most of the traders as they dont know whether the trade will go their way or not. However, it is the periods of high volatility that lets traders make pips and it is the volatile nature of the forex market that attracts the risk seekers in search of high returns. Have you ever thought; why not concentrate on the low volatility period instead of focusing on the high volatility market.

There is a tendency in the currency prices to alternate between periods of high volatility and low volatility in the forex market just like other financial markets. This recurrent pattern is due to the crowd psychology which is the force behind changes in the forex market. Forex market is just people trying to buy or sell currencies. It is the psychology of the crowd that rules the market in the end.

You must understand how trend is developed in the currency market and how the crowd psychology affects the different phases of the trend. There are four main stages of a trend and there is a different crowd psychology behind each stage of the trend. These four stages are: 1) Nascent Trend, 2) Fully Charged Trend, 3) Aging Trend and 4) End of Trend. These four stages are closely linked to the cycle of volatility in the market. Lets discuss these stages of a trend in detail.

Nascent Trend: This is the first stage of the trend. In the beginning of the trend when the new trend just starts either upside or downside, most market players are still skeptical about the possible new trend direction during the nascent stage of the trend. Volatility is thus low as both bears and bulls tread carefully and are cautious. Nothing is clear at this stage of the trend. Market players are trying to confirm or deny the start of a new trend. So everyone is cautious.

Second Stage-Fully Charged Trend: The trend is in full progress and it is time for more action now. During this stage the trend becomes well established. The trend becomes fully charged as there is now evidence from fundamental data that supports the trend direction. When the new information proves them wrong, traders who are caught on the opposite side of the market become exposed. They become desperate to get out of the wrong side of the market.

A lot of changing positions will take place during this period. Traders who were initially on the wrong side of the market become new converts to the trend. This causes the currency prices to move more dramatically within that stage.

Everyone wants to jump in the trend. More and more positions are established. Traders become convinced of the direction of the trend and new information convinces most of the traders of the direction of the trend. Hence volatility tends to be high during this period. This brings prices to higher highs in an uptrend or lower lows in a down trend. Always remember, Trend is your friend. Ride the trend as long as it lasts. - 23222

About the Author:

Mr. Ahmad Hassam is a Harvard University Graduate. He is interested in day trading stocks and currencies. Know These Forex Charts. Learn Forex Trading!

Benefits of Recycling Gold

By Morgan Robinson

There are many benefits to recycling gold. You can sell gold jewelry that is just sitting around collecting dust and make some money. Recycling gold is also good for the environment. Recycled gold is melted down to liquid form and then molded into a new product or piece of jewelry. Gold prices are at a all time high so you will be surprised at what you can get for the old pieces of jewelry that you have been saving.

The demand for metals is increasing at a faster rate than the mining industry can supply. Recycling of gold and other precious metals helps fill the gap between the growing demands and decreasing supply. When you recycle you also help save the environment by the not depleting more of our natural resources.

When they mine for gold it waste a lot of water; not only does it take an enormous amount of water it also contaminates the water sources it draws from. The majority of gold that is mined in the United States comes from Nevada. The Nevada Gold Mines consume more water every year than all of the population of Nevada combined. One gold mine can consume 100 million gallons of water every day. The harsh chemicals that are use to refine the ore further pollute the ground and destroy local ecosystems.

The mining process that is used to extract the ore from the surrounding rocks amount to a huge amount of waste; a large part of it is in the form of discarded rock that is saturated with chemicals and solvents. This means for every ton of pure gold that exists there is three million tons of waste to dispose of. Eventually the chemicals and solvents in the discarded rocks will find their way into our ecosystem. This in turn will affect native plant life and the animals in the area of the mines.

The end goal of any mining company is to process as much gold as possible and this means that the more they mine the further underground they have to go. This makes mining a determent to our natural resources. The profit is huge for gold so the mining companies use the last technologies and processes to get as much gold as quickly as possible. Even though they are mining more efficiently they are still depleting our natural resources. This is why recycling everything and anything we can, including precious metals is becoming more important every day. You can help to do your part for the environment by recycling you precious metals and looking for jewelry that is made with recycled metals. You can clean out your jewelry box and get rid of things you never wear and it will give you more space. You can always take the money from the gold you sell and purchase a piece of jewelry you have had your eye on. Gold recycling is a easy and fast way to recycle your unwanted gold jewelry and make some money at the same time. - 23222

About the Author:

The best online resource to sell gold or sell gold coins can be found at http://www.refinity.com

Swim Clear Of The Sharks In The Stock Market

By Steve Wyzeck

Are you losing money in the stock market because of false breakouts? This article could completely turn around your trading...

I am going to tell you a stock trading secret that is so powerful, it will save you thousands of dollars. I should know, that is how much it saved me.

Institutional traders use dirty tactics in the stock market that are so bad, they should be illegal.

It may upset you. It may piss you off.

It may even make you want to close this page and forget you saw it...

But you need to know what they are doing...

And I promise you you'll be glad you did.

Because by the time you finish this article you'll have a whole new method for avoiding false breakouts...

We need to look at what support and resistance lines are and they what false breakouts are.

Knowing WHY support and resistance lines work will help you protect yourself against false breakouts.

When traders buy and sell a stock, they commit emotion to the trade. It is their emotions that will keep a market trending higher or send it into a reversal.

When stocks fall, a few traders will exit their position and take profits, a few traders will exit their position for a loss, and a few traders will stay in their position and hold on.

What you see on a chart is the emotional commitment, or lack thereof, coming from the crowd that is trading that stock.

Pain Is the #1 Reason Why Support and Resistance Lines Form

If someone trading a stock is still holding that stock when the price finally comes back to their cost basis, they are likely going to sell. It is painful to be in this stock and the trader simply wants to get out. This pain relief will temporarily stop a rally. These painful memories are why support and resistance lines form.

I am going to give you an example so you can better comprehend what I am talking about here. Say a $40 stock sells off and falls to $35. It then stays at $35 for several weeks. Traders get confident that $35 is "the bottom" the longer this level holds. A trader finally buys the stock at $35. Right after buying, the stock drops to $32. Seasoned traders would have set their stop loss right under the $35 level and so would have exited around $34. Amateur traders will stay in their position refusing to take a loss. They will hold this losing position until the stock finally comes back to $35 where they entered. They eagerly jump at the chance to "get out even". This "get out even" selling will temporarily stall a rally and cause a resistance level to form.

Regret Is A Reason Why Support and Resistance Lines Form

Traders who come across a stock that has spiked up feel as if they have "missed the train." If the stock drops back to a certain level, these traders who feel regret for missing the first move will jump at a chance for a second move. Their buying forms a support level.

Whenever you work with a chart, draw support and resistance lines across recent tops and bottoms. Expect a trend to slow down in those areas, and use them to enter positions or take profits.

Institutional Traders Cause False Breakouts

A false upside breakout occurs when the market rises above resistance and sucks in buyers before reversing and falling.

A false downside breakout occurs when prices fall below support, attracting more bears just before a rally.

Any stock chart can form false breakouts but be especially careful of any stock that has a high percentage of institutional ownership.

False breakouts provide institutional traders with most of their best trading opportunities which is why institutional traders most often are the ones who cause these patterns to form in charts.

Institutional traders have access to all limit orders. They know how many more buy orders are above a resistance level.

Institutional traders engage in what is called "running the stops". False breakouts happen when Institutional traders organize hunting parties to run stops.

For example, when a stock is slightly below its resistance at $30, the buy limit orders come flowing in near $28.50. The institutions calculate the liquidity ratio which measures how much the stock will go up if all buy limit orders are executed at $28.50. They calculate that the stock will run to $31 if all the buy limit orders at $28.50 are executed. They short the stock at $30 to push it down to $28.50. At $28.50 they cover their short position and go long as the wave of buy orders are automatically executed pushing the stock up to $31. If greedy traders start piling in, the institutional trader will stay long the trade. As soon as the buy orders start drying up, they sell short and the price falls back below $30. That's when your chart shows a false upside breakout.

If you are knocked out of a trade because of a false breakout, do not be afraid to get back into the stock. Amateurs usually make a single run at a stock and stay out if they are stopped out. Professional traders will make several runs at a stock before nailing down the trade they want. - 23222

About the Author:

By Steve Wyzeck. To turn your stock trading around visit stock market