Let me just give you a quick tip about setting stop losses.

I once took a class where I was instructucted to place my stop loss 30 pips below my entry. Why 30 pips I asked? I was told it was an "acceptable" risk. Based on what? I see a lot ot traders basing their risk management strategy on some pre-defined pip value risk without any consideration for support and resistance.

Don't do this!

Like I say - trading Forex is a process and setting your stops is a key component. Your stop should be placed near support and/or resistance based on the charts and not some pre-defined pip value. Caution: stay away from the herd!

Simply:

1. Locate support and/or resistance for your stop
2. Calculate your target to determine a reward-to-risk ratio
3. Determine whether you can afford the trade
4. If all systems are a go then pull the trigger

Setting a pre-defined stop makes no sense if all you can guarantee is to get stop out of your trade and have it eventually go in your direction. Let the market tell you where to protect your trade and when to take profits. This is why 2 traders can look at the same charts, establish the same trade and one trader pull the trigger an the other traders pass.

Follow YOUR trading plan and begin to take your trading to new heights. Your Forex Education is the path to true Forex profits!

Happy Trading!!

I am scanning the internet looking for information about how I can be a better trader just like most people out there. I am on a quest looking for each and every golden nugget of information out there on the web. I have alerts set up so Google can email every keyword topic of choice.
I have been getting fired up recently about the amount of just plain bad Forex advice slewed across the web. It is definitely a “buyers beware” market and every word of advice (including mine) should be taken with a grain of salt. Why? Because everything I say and write is based entirely on my own experiences.

One of the topics gaining some momentum is the fact that everyone pitching a Forex product is not a trader, but a marketer and if they were a trader they would be trading and not trying to sell you something.

What a bunch of BS!

Yes, I do believe all the information that one needs to trade the Forex profitably is available free on the internet. I challenge anyone new to Forex to assemble the information, study and execute without any assistance. I would imagine every trader out there has gathered free information and put it to use, but the truly valuable information often is not free!

Example – I read Steve Nison’s books and DVD’s (highly recommended by the way) to gain the necessary insight into candlestick charting. I also paid a couple of hundred of dollars to attend a live seminar. During that seminar Steve Nison made one comment that allowed all of my previous work in candlesticks to click and take my trading to the next level! Was it worth it? Hell yah! That one comment was the only peice of new information I gathered, however it has paid for the seminar 100 times over. Not only that, the opportunity to network with other traders introduced new ideas and approaches that I hadn't thought of previously.

In the end it's a personal decision. After all it's your money. Trading is a profession just being a pilot, a doctor or an engineer. Each requires dedicated training, personal development and instruction to gain proficiency. You would never go to a dentist that learned how to fill cavities on the internet (this information is available there too!), so treat your Forex account the same way.

I am calling all you freebie seekers out! Stop being cheap. Your Forex Education is an investment and not a cost. Cutting corners will only cost you more money in the long run.

Happy Trading!!

Have you ever been in a situation where you have evaluated the market, saw your strategy set-up perfectly and then just couldn’t pull the trigger? You become paralyzed, unable to move even though you know your high probability set-up has just triggered.

This fear is very real for many traders and very detrimental to your account. Fear is a powerful emotion, distorting fact from fiction and often creating an emotional response. Many experts tell you to trade without emotion, but is that really practical? We are indeed human. Remember the basis for the reaction is real, but the fear usually is not.

Fear blocks your ability to execute high probability trades and we must find strategies to manage our fear. With time comes experience and for traders it is the ultimate super hero for fear.

In the meantime, if you are struggling with fear-based execution challenges here are some simple tips to get you over the hump.

Embrace the Emotion

Acknowledge your emotions. If you find yourself analyzing a trade to the point of paralysis don’t try to ignore the emotions. Separate yourself from this river of negativity. Visualize yourself on the river bank as these torrents of emotions are flowing by. You will gain great awareness to the triggers and learn a lot about who you are as a trader.


Separate Fear from Fact

If you fear pulling the trigger because of loss (what if I am wrong?), that will stop you from enjoying the profits the market may make available to you at any given time. Don’t avoid the action that might cause the loss, but re-frame the problem as fear itself. You have evaluated the market, figured out your reward –to-risk ration and accepted your potential for loss through your stop-loss and money management plan. At this point loss is not the obstacle – fear is. There is no such thing as failure, only feedback and that will guide you to consistent and profitable trading.


Re-Think the Consequences

If your mind is off to the races with all sorts of possibilities what’s the worst that can happen if Murphy’s Law gets enacted during your trade? You have already addressed this in your trading plan. Plan your trade and trade your plan. Again fear is trumped and the only way it can be realized is if you didn’t follow your plan. Sticking to your plan is the clearest way to distinguish between a losing trade, which is just a part of business, and a bad trade which is a career killer!

Act in Spite of Fear

Feel the fear and do it anyway. Return to your mission statement or your “why?” statement. The reasons you trading should be big enough to overcome any possible obstacle your fear emotion can conjure up. Acknowledge the fear and do it anyway. You may not have a winning trade, but you will have executed your plan and over time probability will pay you back.

What is all comes down to is the intangibles of trading. Why do I and so many others drive home discipline-based Forex Education and Training approaches. You will never get rid of fear, but with practice you can turn it into a manageable obstacle and deploy it to your advantage.

Happy Trading!!

This means rejecting thinking that doesn’t support your current trading objectives, including rejecting non-trading related mental chatter (what’s for dinner, balancing your check book, who’s on American Idol tonight, whatever). Your goal is simple -- to zero in on the trading task in front of you. Enter your personal trading zone. Deny all incoming calls. Don’t check your email and please do not even think about logging into your Instant Messenger account. You’ve got to be in a place and time where you can trade without being disturbed.

Ask yourself – Where Am I? The answer is - Here

Ask yourself – What Time Is it? The answer is – Now

When you become fully present on the task of trading, you are able to achieve peak performance and gain an edge on the other traders in the market at that moment. How many times have you often have you been trading, felt in rhythm with the market, and then you become distracted, surfed the web (OK, you busted me!), checked your email and all of a sudden, your trade fell apart because you overlooked an indicator or failed to see what economic releases where due out during your trading session.

Trading in the here and now is not only powerful, it is extremely profitable! When you can direct your focus on your trading task without distractions you become invigorated and infused with the energy that comes from requiring yourself to be fully present when trading, you’ll find that your trading all of a sudden becomes a little easier and enjoyable. When you reach this state, stop briefly to observe it and how you feel so that you can summon this mental state more easily in the future. And journal it so you can recall all the factors that contributed to your success. That way you’ll be able to set yourself up in a repeatable, successful trading environment. Your journal will become the greatest trading tool you'll ever own!

To not become fully present when trading is to short-change your Forex Education AND you’re your account balance … it’s like not accepting the greatness within your at the time the market provides you with your pip rewards.

Which mental time zones do you what to be in for your trading? There are only three: past (FEAR), future (ANXIETY) and HERE. It’s been said that most traders spend only 1% of their time in the present. Could you imagine what kind of profits your mind can produce when you become fully present when trading?

Carpe Diem and Happy Trading!!

Well, as I return to my desk from a break to welcome the new addition to my family I was pleasantly surprised to received notification that Forex Journey has been ranked as the #1 Forex Blog by CurrencyTrading.Net on their “Top 25 Forex Bloggers.

Check it out ==> http://www.currencytrading.net/2007/top-25-forex-bloggers

Thanks everyone for inspiring me to follow my passion!

Happy Trading!!

Here's a forex education blog post I like and thought you might too! You can find the article at:
http://financial-blogs.blogspot.com/2007/07/forex-trading-do-you-have-what-it-takes.html

or below:

Forex Trading - Do You Have What It Takes?

There are some facts that you simply must accept to have a fair chance to be successful at Forex trading. Let's have a look at what these facts are and if you can succeed in the worlds most exciting investment environment.

Trading markets are not scientific

The thought of approaching Forex trading by applying science is appealing. However, Scientific theories dont and never will work, because humans determine the market prices, and doing so, they dont consider scientific criteria.

Most people would prefer to be able to make money without risking anything. Many vendors try to gain from this fact, offering trading systems which are described as a possibility to trade with low risk and make a regular income. The fact you must accept is:

If the reward is big, the risk will be mirrored. Pure and simple, risk and reward walks hand in hand. If you can't accept taking risks, you should look for another small business idea.

So far it has been kind of negative, lets have a look at the bright side

To be successful at Forex trading will not require hard work! Work smart not hard is a perfect expression here, meaning that you don't need to learn just for the sake of learning. You'll only need to learn one system/strategy. It wont take long to learn because...

Simple straight forward systems work best. A simple system in Forex trading will outperform a complicated system, short term and long term. Why is that a indisputable fact?
Because it will always be easier to implement a simple system in a complexed market. A complexed system with a lot of parameters, makes it much harder to find the right trading opportunities. The most reliable currency trading systems all tend to be simple.

You can learn everything about currency trading

If thats a fact, why do so many Forex traders lose? The answer is the lack of mental discipline.
Currency trading is more about mindset rather than just a method. If you dont maintain discipline to follow your method, the method isn't there anymore. The best way to gain the necessary discipline is to develop your own method. You'll be confident in your trading because of full understanding of the method.

If you are able to accept and take calculated risks at the right time, Forex trading can be very profitable, due to the leverage at your disposal. Forex trading is not rocket science. Its a lot simpler than you may believe, and thanks to the Internet it's available for everyone.

The key points:
Education
Learn to accept the risks
Rely on yourself
Trading discipline

You read about the risk trading the Forex market every day. I talk to many successful traders and investors about the Forex market and it is mind blowing the fear this market produces amongst the conservative investors and daredevil attitude of the aggressive traders. Yes, it is a fact that 95% of traders lose money in Forex. I was taught that if you want a better answer then you have got to ask a better question and my question is why?

The answer is rather simple – most traders seek the path of least resistance and that will inevitably lead to failure. They failed because they didn’t take the time to gain a proper understanding and cheated their Forex Education!

Look, the market is neither for you nor against you. It makes profit opportunity equally available as the chance to take a loss. It will take money from you no matter your age, sex, experience or effort you put into your trading. The Forex market only rewards those who are correct and nothing else. It’s the old saying – work smart and not hard.

That leads to the next question; how can I be correct and smart? The answer is simple – through Forex Education. I have put together my Success Formula for trading the Forex market.

1. Strategy – it’s not a one size fits all world. Different strategies play to us based on our individual trading personalities. Understanding the rules and tools are critical when applying them to the market. This comes with time and experience. Don’t short change your learning curve. It will eventually lead you to profit.

2. Money Management – planning your risk will keep you in the game as you climb the learning curve as well as exploding your account once you’ve gained the experience and knowledge. Mastering this skill is not optional!

3. Self-Mastery - is having the discipline and emotional control to manage your strategy and money management plan. Knowing yourself will be skill that catapults you in to the elite 5%. It takes self-awareness training, accepting full responsibility for all of your trading actions and the ability to go beyond trading and finding your true personality. Talk to any successful trader and you will quickly see the control they exert not only in their trading, but in their lives in general.

Learning to trade Forex isn’t rocket science. Keeping things simple and working smarter will lead you to success in this market and the path forward can only b accomplished by investing in your Forex Education.

Happy Trading!!