If you look at the price of any currency on a chart, you will notice short accelerated price moves or spikes to the upside – they accelerate away from the main trend and then quickly pull back. These short term moves are caused by traders emotions. The emotion at work is greed and traders when greed is present push a price to far ahead of the fundamentals and then, prices pull back This happens time and time again and our strategy will spot when prices have been pushed to far to fast and sell into greed, to make quick profits.

So how do you spot a market has moved to fast and how do you execute your trading signal? Let’s look at some simple steps and how to do this.

1. Wait for an acceleration in price on high volatility to occur.

2. Once the price spike is under way, you need to see how overbought it is and this is easy to do all you need to do is check some momentum oscillators.

3. Momentum oscillators will tell you how overbought the market has become and once you have learned them, you can do this visually by simply looking for the right set up. There are many of these indicators and the best are – the Macd, RSI, Stochastic and Williams %R. I don’t have time to explain how they work here – but you can learn them quickly and for free online, then pick 2 or 3 to help you spot an overbought situation.

4. Now you have to wait for divergence. When a trend is strong, momentum and price will both be in synch anbd rising, as soon as momentum turns down and prices are still rising, the trend is likely to change so as soon as you see divergence – sell the currency.

5. Once you have your trade in the market, put a stop loss order in above a nearby strong resistance level and set a target where you wish to take profit which will be just above a support line. You take your profit above support and bank your profit and wait for the next set up – you Never let a support line be tested, in case it moves back up from support, you get out early just before the test occurs

6. The key to using this simple system is not just to look for overbought markets but markets are very overbought – the more a market is overbought, the bigger the move down will be, so be selective in your trades.

A Simple Strategy? Yes But ALWAYS Remember This!

All the best strategies and this one couldn’t be simpler to understand and apply and it makes big gains.
I have been using this strategy for over 20 years, just looking for price spikes and using 2 momentum indicators and support and resistance lines and it makes a lot of money and is actually exciting and fun to do – so learn to trade divergence and get on the road to a great second income in 30 minutes a day.

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Currencies move for sustained periods of time in the same direction and these trends can be seen on any chart and can last for many weeks. These trends ALL begin in the same way – the price breaks overhead chart resistance and then accelerates higher and a new trend is in motion. As the trend unfolds, brief dips occur and then, prices accelerate and break through resistance again and this continues several times in major trends.

Breakout trading is a great way to make money trading Forex and professional traders use this method all the time but most other traders don’t – so why to do so many traders ignore this method when it’s obvious it makes profits?

Most new traders want to buy the low of the currency pair they are watching but breakout trading means you miss the start of the move. This doesn’t matter though, because by trading the breakout you have the odds firmly in your favour and good profits ahead so missing a little bit of profit doesn’t matter.

Losing traders know prices are going to go higher when a break occurs but make the fatal mistake of – waiting for a dip in price so they can get in at the low. Prices on good breakouts quickly accelerate away from the breakout point WITHOUT pulling back. You cannot predict the low of any market so there is no point in trying to catch it. The good news is if a breakout occurs, you may have missed a small portion of the trade but you have weeks of profit in front of you.

When looking for breakouts to trade you need to be patient and look for resistance levels which have been tested several times and then you need to wait for the level to give way to execute your trading signal. The minimum number you should consider is 4 and as a general rule – the higher the number of tests before the break the better the odds of the breakout being a good one when it comes.

When a breakout comes, go with the break and tuck you stop under the level which has given way. You have close stop loss protection if your wrong but if the trade goes your way, you profit potential is huge.

Breakout trading is one of the best ways to make profits when trading Forex, you will get a few good breakouts each month and if you catch and hold them, you can make a triple digit income in around 30 minutes a day.

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Here are your simple steps to follow to currency trading success:

1. Learn the Basics and DON’T use Software or Short Cuts!

The first point you need to keep in mind is you must learn the basics and right knowledge. Do not make the mistake most new traders do which is to think they can beat the market by buying a cheap software package and doing no work. If these packages worked, everyone would trade for a living and 90% of traders would not get wiped out.

It will only take you a few weeks study to learn all you need to know because of the next point.

2. Use a Simple and Robust Strategy

Simple systems work better than complex ones. Simple strategies tend to be easier to understand, have confidence in and have fewer elements to break so there is no need to make to much effort keep your strategy very simple and it can make money.

In addition, just follow price action on charts this will then mean, you don’t need to know about the news or follow economic trends, you just need to spot high odds chart set ups.

3. Trade Confirmation of Price Change and Don’t Predict

Don’t try and guess market turns and don’t believe the ridiculous idea that you can predict prices – you can’t but you can win by just following price action and locking into and holding trends. Trade the reality of price action and you can make a lot of money, try and predict market turns and these predictions, will be as on target as your horoscope!

4. Trade longer Term Time Frames and be Patient

Trade long term trends, this means you are looking for trends which last for weeks or months and not hours or minutes. Short term trading is a mugs game, you are trading the noise of the market and the odds of success are low. All you will do is make a lot of effort for no reward instead, be patient trade long term trends and hold them.

5. Trade with Discipline and Sick to Your Plan

The key to making any strategy work is to love your losses! You need to keep them small, If you let them run and hope they turn around, your account will soon be turned to dust. Keep your emotions out your trading, take losses quickly and you will hold on to your equity and if get in and hold the big trends, you will make your losses and get an overall profit on your account.

Final Words

If you understand the above you will see why anyone has the potential to become a successful currency trader from home and earn a great second income in 30 minutes a day.

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When you learn to trade currencies you need to learn how to trade and this should only take a few weeks at most and the reason for this is the best currency trading systems are simple. You don’t need to make a system complicated to win because when your trading currencies if you make a system to complex it will have to many elements to break.

The best way to trade is to trade price action and lock into trends. You will see trends on any Forex charts and the big ones last for weeks or months and make huge gains – so how do you get into them?

All you need to do is learn visual high odds set ups and they will get you in on these trends. Chart formations are a reflection of human nature and repeat over again because human nature remains constant.

When you are using a technical system, you don’t need to know anything about the news or the economy, you simply trade the trend – You have no interest in the reasons behind the trend you just want to make money from it.

So all you need is a simple trading system based on charts and anyone can learn one of these so why do so many people still lose?

The answer is – they let their emotions get involved in their trading and when they lose, they let losses run and this leads to disaster. If you trade currencies online, you have to accept losses, take them and keep them small. There is nothing wrong with losing, so long as you run your winners you can cover them and make a big profit on your account.

Trading currencies is not hard to learn and anyone can master the basics needed for success and if you make sure you adopt a disciplined mindset which is a choice anyone can make, you are on the road to a triple digit income, in the worlds most exciting investment market – trading global currencies for profit.

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Richard Dennis was a well known trader who organized an experiment, to prove trading currencies could be learned by anyone and also be learned quickly. The experiment took people of all ages, both sexes and people who had various education backgrounds taught them to trade the markets. The group contained – an actor, a security guard, a boy out of high school and a lady accountant and many others and then they were taught a system in 2 weeks.

After their training, they all went on to achieve triple digit annual profits and make over $400 million in profits in just over 4 years.

- If you want to enjoy currency trading success, you can learn the following from the above experiment.
Forex trading doesn’t take long to learn and the above group proved this having no experience and learning to trade in just a couple of weeks. The key to learning Forex is to work smart and get the right knowledge. You don’t get rewarded for the amount of effort you put in, your rewarded for being right with your trading signal.

- Simple trading systems work better than complex ones because they have fewer elements to break and this has always been so – why? Because a simple system is more robust and has fewer parameters which can break so always keep your system simple too.

- The real key to the systems success was its money management and most traders fail to appreciate how important it is. The system lost around 70% of the time but still make huge gains and the reason of course is losses were kept small and the 30% of winning trades easily covered the 70% of losers and made huge gains on the account.

- The key to any traders success is keeping emotion out of trading and all the traders in the experiment commented on this – following the system was easy but trading with discipline was hard. Most traders struggle with their emotions but if you want to win, you need to make a choice and that choice is to follow your system correctly, take losses and keep them small and run the big profitable trades.

The above experiment is one of the most famous ever done in trading and if you study it, you will see why anyone has the potential to win but lost traders lose. Can you win? Of course you can but always keep in mind, your mindset is just as important as the system you use. The above experiment inspired me to trade and I hope it inspires you as well.

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Humans are not logical and those people who tell you, they can predict Forex price movement in advance are wrong. So if you can’t predict what people will do how do you win? Simple – you trade high odds set ups and you keep losses small and run your winning trades and if you do this you can make huge gains. The simple Forex trading system, we are going to look at here does just that – so lets look at the logic behind it and some simple tips for success.

Greed and fear are present in the bulk of traders and these emotions will push prices to far up or down and away from value, when this occurs you trade opposite to the herd and make big money. You can see emotions at work on Forex charts in the form of short sharp accelerations in price and you will also notice they soon reverse. The key to winning of course is timing your trading signal.

In the example below, we will look at a bull market but the same logic will occur in a bear market.
Keep an eye on your charts and look for a price spike which suddenly explodes prices to the upside and you will normally find when these happen the news is telling you move will continue and then get ready to sell.

- To time your trading signal look at momentum. If prices are rising strongly momentum will normally be going up as well and you can see this on momentum indicators such as the stochastic, the RSI and the MACD. Look for these indicators to be overbought and even better, to be near an extreme on a daily chart and wait for momentum to fall, as prices continue to rise. This is known as bearish divergence and means it’s time to sell.

- Once you have sold put stop loss protection in above resistance and wait for prices to fall and then, as they fall, move your stop to break even and then set a downside target and take profit.

- Within existing trends, you will always get brief spikes up which go to far ahead of the trend and you can trade these and when you do its known as swing trading and trades will last a day to around a week. When a trend ends, the same reversal pattern is there but if you catch a trend reversal and a new trend develops, you will be getting into a trend which can last for many weeks or many months.

If you trade into greed, when the majority believe the move will continue and these traders are bullish, chances are you will make a big profit because the majority is always wrong. This simple trading system can be used for short term or longer term trading and while its simple, works and makes huge gains.

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The problem with all the Forex robots sold to retail clients online is they make big claims and then have no audit of results. The fact is most of them base there track records on back tests on paper. All they do is make a system knowing where all the market highs and lows are and make it show a profit. When these systems get traded for real they get taught a lesson by the market and lose. Other robots present what they say are real money figures but there is never any proof and you take the word of the vendor but if you do decide to take the word of a Forex robot vendor consider these facts:

If Forex trading success could be bought for under two hundred dollars 95% of traders wouldn’t lose money and furthermore, who would bother to work? I wouldn’t buying financial freedom so cheaply would appeal to anyone especially, as you can make money with no effort!

The track records presented in terms of drawdown to growth are simply laughable, not even the super traders such as Jimmy Rodgers or George Soros could match them and to think a two hundred buck robot will is fantasy not reality.

Winning at Forex Trading

If you want to win at Forex trading you can but you need to do what you do in any other area of life and that’s make some effort and do your homework.

Forex trading can however be learned by anyone and in terms of the work you need to do, the rewards can be enormous. Take Forex trading seriously and you will be well rewarded, think you will make money with no effort with a cheap Forex automated trading software package and the market will take your money – it really is that simple.

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Forex courses allow you to learn risk free because if you buy them, you normally get a few months to see if they work for you and if they don’t you get your money back in full. When you consider that a course will cost you around $100, there a great deal – there affordable, you have a rebate guarantee but if they work for you, you are on the way to a great second income.

The best courses provide the following:

- Proven tools and strategies and the logic behind them so you can trade them with confidence and discipline.
The methods will be traded in real time via daily profit bulletins so you can see how profitable the strategies are.

- You will also get tips on adopting the right mindset, money management and have dedicated advisors to answer any questions or queries you may have.

Can You Become a Successful Currency Trader? Find Out for Yourself Risk Free!

If you learn Forex trading with a course you can discover if you can become a Forex trader from home and make money trading currencies – so you have everything to gain and nothing to lose by trying them and if you do you could soon be on the way to a great second income.

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The first point to keep firmly in mind is – 95% of traders lose money, so don’t make the mistake that most novice traders do which is to think they will get rich with a cheap software package. There are numerous Forex robots and sure fire systems for sale and there all junk, avoid them. If you really could make money without making any effort, 95% of Forex traders wouldn’t lose money – period.

You need to do some work but you can easily learn to trade in a few weeks, if you follow the tips below.
Base your Forex trading strategy on looking at and generating trading signals from Forex charts. If you do this, you don’t need to follow the financial news or have a degree in economics, you simply learn how to spot chart formations which can get you into trends – Your concern is not why prices are moving, your only focus is making money when they do and locking into the big profitable trends.

You need to keep your trading strategy simple and not over complicate it or make it to clever – Why?

Because if you make a Forex trading system to complex, it will simply break in the brutal world of Forex trading. In Forex trading simple strategies work best and always have.

So the above is the easy part of Forex trading but you now have to learn to adopt the right mindset and this for most traders is difficult, because they hate taking losses but the reality is you must take losses and keep them small to win. If you do what most traders do and let losses get out of control – you will join the 95% of traders who fail at Forex trading. So accept your losses cheerfully and wait for the big trends and then run them.

Another key factor you need to succeed in Forex is courage.

You need the courage and confidence, to trade against the losing crowd. Most traders hate doing this and standing alone and like to seek advice, from other traders or follow news stories – but 95% of ALL traders lose! So being with the majority is not such a smart idea. If you are confident in what you are doing, you need to forget what the majority are doing and focus on following your system.

With Forex trading you can make big gains but you need to get the right education and just as importantly, adopt the mindset of a winner and this is a choice which you can make if you want to – so do you want to make a great second income in 30 minutes a day?

If you do and you have the motivation to learn and a desire to succeed, Forex trading success can be yours.

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Most people who write about the best currencies to trade focus on the majors of – Dollar v the Euro, Yen, Swiss Franc, British Pound, because they all offer good liquidity and the tightest spreads with the Euro and Yen are the most liquid currencies against the Dollar and with the tightest spreads – they must be the best to trade? This is not quite correct.

They offer excellent long term trends but the disadvantage of trading these currencies is the speculative interest is so high and this means volatility can also be high, trading conditions can be choppy seeing many trades hit on stop, as the markets spike either up or down, so they can be great to trade but you should not just focus on these majors, as other currency pairs also offer excellent profit potential.

The Australian Dollar and Canadian Dollar are another two good majors to trade and while spreads may be wider than the above currencies, these currencies offer excellent long term trends and offer position traders some great opportunities.

Trading Cross Rates for Bigger Profits

Rather than just focusing on trading pairs which are against the Dollar, you should look for opportunities in the cross rates. Cross rates have higher spreads than the majors but can very often provide the best opportunities if all and the reason for this is there is simply there are less speculators trading them

A common rule in any investment not just currencies is:

“The Less Observed, the better the trade is likely to be. For example, if most traders see a trend coming and its expected by them and the news wires, it’s less likely the trade will go as the majority expect. To explain this Bruce Kovner one of the true Forex trading uses the Heisenberg principle in physics to show you why the cross rates can offer some great opportunities.

“If something is closely observed, the odds are it is going to be altered in the process” If a market breaks when know one expects it the odds are therefore far higher than when they do.

If you think about this, it’s logical and true – the bulk of traders don’t observe the cross rates and they can often offer some stunning long term trends, you can trade without the whipshaw action of the majors.

How to Find the Best Profit Potential and the Best Currencies to Trade

In terms of trading currency pairs to trade simply use the following checklist:

Look at all pairs for opportunities, don’t restrict yourself yo just one favourite pair, market conditions change all the time and so does the best currency pair to trade. Furthermore, Only trade currencies which are moving or trending, otherwise you will tying up your capital for long periods of time, wait for signs that the market is starting to trend. If you get in to early, you might have to wait a long time to see any profit from the trade.

So what are the best currencies to trade? This changes all the time and different pairs will be the best at any particular moment in time. If you have understood this article, you will be able to spot the best opportunities as they arise and make some great FX profits.

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