|By: Sha - at February 12, 2013
Best Forex Trading Strategies to Trade Successfully
Trading Strategies to Make Money in Forex Market
the global economy, trades, current affairs and some basic knowledge
about trading strategies and ideas can help you earn money investing in Forex
markets. Forex, however, is one of the riskiest markets to invest in. A small
mistake may cost you to lose most or all of your money that is invested in Forex
markets. A lot of investors and traders are making fabulous money from
international currency markets. If you are new to Forex, you should be aware of the risks
and potential losses Forex markets may cause you. At the same time, if you are
interested in Forex trading you should learn about the fundamental and technical
forces that cause changes in Forex markets. You can always make money from an
active Forex market. When the market moves up you can make money. When the
market moves down there are also opportunities to make money.
Forex is open 24 hours a day. Forex is the world’s largest financial market with a daily turnover of about $3
trillion. Naturally it is one of the best places to make money. By learning some
basic trading strategies and tricks you can succeed in Forex trading. Here are
some of the best Forex trading strategies:
Fundamental and Technical Tips
- Learn fundamental and technical factors that move the
- Keep updated information about the latest and important economic data
released by major economic powers and reliable government, investment or
finical organization, and international organizations.
- Keep in touch with the current global affairs that have
the power to influence global financial markets.
- Never enter the market without properly studying the
market data and trend.
- Always be prepared for the worst as no one can predict
the Forex market with 100% accuracy.
- Always take calculated risks so that you know when to get out
- Never use more than 20% available funds of your equity to
invest in the markets.
- Never enter the markets when the markets are confused
just prior to important releases of data, delivery of speeches by important
figures, or any important events that can influence the global financial
- Stay out of the markets when you cannot decide on
trading. You will always get opportunities to trade.
- Always put stop loss order that is well-placed
- Never enter the market based on the opinions of others
- Never ever become emotional when trading in Forex market.
Do not trade too often.
- There are three major sessions in Forex markets namely,
Asian session, London session (European Session) and New York Session. For
range trading New York session can be the best option for you. London
session moves the market greatly. In fact, any of these three sessions can
record the day high and day low of the market. London and
European session provides the most movement.
- Try out of the FAP Turbo
program, which has helped me immensely with getting things more automated.
There are three major sessions that move
Forex. These are Tokyo Session
(Asian Session), London Session (European Session), and New York Session (North
American Session). As a trader it is very important that you are familiar with
each of these 3 trading sessions. One interesting thing about these three
trading sessions is in each trading session there is a period of time when two
sessions are open. Tokyo and London session overlap for an hour during the
summer. London session and New York session overlap for 4 hours during both
summer and winter. The trading hours where two sessions overlap are naturally
very busy times of the market, especially when London and New York session
overlap. These are the times when a great deal of liquidity takes places. These
trading hours can be great to do range trading. The huge liquidity
market gives both buying and selling opportunities for calculated short trading.
Tokyo session starts at 12.00am GMT. This session is also called Asian session. Tokyo session is an important session as Tokyo is the third largest
trading center in the world. Also, Japanese yen is the third most traded
currency in the world. There are other important trading centers like Hong
Kong, Singapore and Sydney who all participate during Tokyo session. Shanghai, the
largest financial center of China is also involved in Asian session. As
economy is booming it is expected that in the future Tokyo Session will be more
The best trading times are early in the session. One of the main characteristics
of Asian session is Asia Pacific currency pairs give stronger moves than
non-Asia Pacific currency pair. Yen is a heavily traded currency in Tokyo session. USD/Yen is a nice pair to trade during this session. An important thing about
Tokyo session is it can set the tone for the rest of the day. Traders in London
and New York sessions can evaluate what happened in Tokyo session and organize
their trading strategies. Traders consolidate in Tokyo
session after the big moves in the preceding New York session.
London session is considered the most important session of
Forex market. London is the world’s largest Forex trading center. More
than one-third of the world’s $USD transactions take place in London and more
Euros are also transacted in London than anywhere else on earth. Other very
important European financial hubs such as Frankfurt, Paris, Rome, and Madrid
also enter the market making the London session volatile. London’s influence on
global currency markets is so crucial that European session is also called
London session. Also, during London session New York session also enter the
currency markets. London and New York sessions overlap for 4 hours and during
this period tons of liquidity take place. London session overlaps both Tokyo and
New York session giving it very high liquidity. Pip spreads are also lower during London session.
However, during lunch time in London session, traders become less
active. But traders become active again at the end of the London session when
they take profits or engage in more trading actions. There is so much
liquidity during London session resulting from the very large number of transactions, that
almost any currency pair can be traded during this session. However, the best
technique would be to stick with the majors such as EUR/USD, GBP/USD, USD/YEN,
and USD/CHF. Besides, AUD/USD and particularly Yen crosses such as EUR/JPY and
GBP/JPY also give volatile movements.
New York Session
New York session is the time when major economic news from the USA, and
sometimes Europe come out which can shake up the Forex market. New York
session can move the market greatly by even recording both lows and highs of the
preceding sessions. For day traders and those who are good at range trading, New
York session is ideal. New York being one of the largest financial centers in
the world, it has a major influence on global financial markets such as Forex
market. When New York session begins London session enters in the middle of its
own session. So naturally the New York session starts with high liquidity.
The US dollar is the currency that is traded mostly in the world against other
currencies. A single piece of data can move the market greatly in a
matter of seconds. The New York session becomes volatile in the afternoon session
when London session closes. The volume of trades taken place during New York
session is massive as the London or European session is also open at the same
time. There will be tons of liquidity during this session. Sticking to the major
pairs would be the best trading pairs.
Forex trading is a very popular way of making money. Unfortunately, most
investors and traders lose money in Forex trading. Without fundamental and
technical trading strategies and a very sound knowledge of Forex trading, it is
not possible to succeed. There is always risk of losing all of
your money if you are not careful about the factors that move the market. It is
essential to be familiar with the market conditions in each major session. Choosing the right
Forex broker is the most important decision if you are
starting out with Forex trading. Make sure that your chosen broker meets all the
requirements to be 100% legitimate and authentic. Take the time to research the
market and find a trading strategy that works.
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