[AbeSmith]

Hello. I'm interested in Forex market. I've never done it before but I like the high leverage that it gives. So I've been looking at EURUSD on the daily chart and it is looking like it is going up. So I'm thinking of buying on a dip and holding it for several days or more. But I see the big 1.50000 not too far away. Seems to me it might be a major resistance, but again I don't know much about Forex and don't know how much impact a simple number can have in forex. Just wondering if anyone has any advice on this trade. I'm interested in investing $1000 with as much leverage as possible without risking getting stopped out on volitility. Can it be done safely? Or should I look into something else in Forex? Perhaps the USDJPY?

What things should I watch out for? Only thing I know about Forex is that interest rates play an important role. If interest rate of a country goes up, then people are likely to move their money out of that currency and into a higher rate currency. Seems to me the Fed is not going to cut interest rates anymore, because it is hurting the dollar. Does that sound right? Again, excuse my ignorance if I'm not making any sense. Just wondering how I can enter the Forex market for swing trading. Or is day trading Forex a better option? What are the major S/R points in Forex? Do Pivots play an important role?

[torero]

If you want to learn more about forex, currently the best threads right now are:

http://www.traderslaboratory.com/for...sd-2591-3.html
http://www.traderslaboratory.com/for...-usd-2854.html

You got 2 veterans who can gives you the insight you want (Anna-Marie and Milliard). One of the few threads I contribute on a regular basis now.

[AbeSmith]

Originally Posted by torero »

If you want to learn more about forex, currently the best threads right now are:

http://www.traderslaboratory.com/for...sd-2591-3.html
http://www.traderslaboratory.com/for...-usd-2854.html

You got 2 veterans who can gives you the insight you want (Anna-Marie and Milliard). One of the few threads I contribute on a regular basis now.

Awesome. Thanks Torero.

[Art Krantz]

Fear & conjecture (psychology) rule these instruments. They’re acutely sensitive to news flow of any color or creed.

Most of the ongoing chatter regarding:
interest rates
economic gauges (inflation numbers, foreign money inflows-outflows, housing, jobs data, blah blah)
central bank activity (& whispers)
global imbalances etc, constantly whip up the volatility & pitch & toss them around to intra-day & intra-week fair value camps.

Technicals are merely your weapon of choice to price & balance the fundamental biases which pop the pairs/crosses up & down the chart map day after day.

If you can get in tune with the psychology of the market - keep one ear on the fundamentals & the other one on the technicals, you got yourself an even chance of pulling serious dough out of this circus.

Players are constantly pricing in the fundamental flavor of the day as the relevant item of chatter/news hits the market. Your job is to interpret & grade it depending on importance or relevance & match it up with your technical grid/trade plan.

Sometimes, you’ll get an aggressive pop to the upside/downside, or an out of whack move, which is specific to a particular currency at that time.

If you know what you’re looking for (unique fundamentals) you can work the short-term strength/weakness of that specific currency to your benefit.

These instruments are awful fickle, as are the participants. But generally they’re pushed & shoved around by the currency packing the heaviest muscle. In other words, trade what’s in front of you now, not what might occur in a couple days/weeks.

Buy the strongest, sell the weakest is a simple, effective game plan to wrap a strategy around. Pure common sense (a trait severely lacking in most traders) will also be a good friend when navigating these waters.

[AbeSmith]

Originally Posted by Art Krantz »

Fear & conjecture (psychology) rule these instruments. They’re acutely sensitive to news flow of any color or creed.

Most of the ongoing chatter regarding:
interest rates
economic gauges (inflation numbers, foreign money inflows-outflows, housing, jobs data, blah blah)
central bank activity (& whispers)
global imbalances etc, constantly whip up the volatility & pitch & toss them around to intra-day & intra-week fair value camps.

Technicals are merely your weapon of choice to price & balance the fundamental biases which pop the pairs/crosses up & down the chart map day after day.

If you can get in tune with the psychology of the market - keep one ear on the fundamentals & the other one on the technicals, you got yourself an even chance of pulling serious dough out of this circus.

Players are constantly pricing in the fundamental flavor of the day as the relevant item of chatter/news hits the market. Your job is to interpret & grade it depending on importance or relevance & match it up with your technical grid/trade plan.

Sometimes, you’ll get an aggressive pop to the upside/downside, or an out of whack move, which is specific to a particular currency at that time.

If you know what you’re looking for (unique fundamentals) you can work the short-term strength/weakness of that specific currency to your benefit.

These instruments are awful fickle, as are the participants. But generally they’re pushed & shoved around by the currency packing the heaviest muscle. In other words, trade what’s in front of you now, not what might occur in a couple days/weeks.

Buy the strongest, sell the weakest is a simple, effective game plan to wrap a strategy around. Pure common sense (a trait severely lacking in most traders) will also be a good friend when navigating these waters.

Thanks Art for the very informative post.

[brownsfan019]

Abe,
I assume that the jump to forex is saying that the jump to futures didn't go as planned.

I realize each market is it's own animal and perhaps trading forex will work better for you, but proceed with caution. It looks like you are looking for leverage and that alone is not reason enough considering how much leverage is available in futures.

My point is that this is a classic newbie move - try market #1 and when that doesn't work b/c you have not put in enough time and energy, move to market #2 b/c you found a chart or two that just provided thousands in profits.

Just proceed with caution Abe as I would argue that Forex is even HARDER to trade than futures since your broker can be working AGAINST YOU. The 'no commission' marketing BS is just that - BS. If you really like currencies, there's a few on the CME that trade, in particular the EC/6E that is plenty liquid for most traders.

[Art Krantz]

Originally Posted by brownsfan019 »

Just proceed with caution Abe as I would argue that Forex is even HARDER to trade than futures since your broker can be working AGAINST YOU.

The 'no commission' marketing BS is just that - BS. If you really like currencies, there's a few on the CME that trade, in particular the EC/6E that is plenty liquid for most traders.

I'd sure agree with that point. I know Andre (milliard), Anna & myself included, wouldn't touch (traditional) retail FX if you paid us.

I appreciate there are a couple half decent operators out there, & if you're a hobby trader, then it doesn't really matter either way - but if you're playing this circus for serious dough, you won't be trading via the bucketshops anyway.

[Anna-Maria]

Ditto. Always wise to give a wide berth to the spin & churn merchants. Even the larger, popular retail shops have absolutetly nothing serious to offer.

Budget retail spot is ok if you leg in via the likes of interactive brokers, Hotspot & EFX.

Choose your partner according to your pocket, aims & expectations. If you're competant, manage to avoid the usual pitfalls & stay the course, alternative avenues will open up for you if you really want them to.

Usual advice applies: Due diligence, engage brain & double check!!