Japanese Candlesticks And Foreign Exchange Trading

Japanese Candlesticks And Foreign Exchange Trading by Ian Armstrong

Do you think of anything when I say the phrase, "Japanese candlesticks?" In fact, this has a lot to do with trading in foreign exchange.

Candle charts (also called "Japanese candlesticks") were originally created in Japan several centuries ago so that rice could be traded. Today, thousands of traders use the same charting "system" to track price movement.

Many people find that candle charts are easier to read than standard bar charts are, and therefore, they have become very popular. In fact, most Forex charts you see are in the format of Japanese candlesticks.

Candle charts are made up from the opening and closing prices, as well as high and low prices.

If a price opens lower than it closes (in other words rises during trading), a hollow candle is drawn on the chart (usually in white or green).

If a price opens higher than it closes (in other words falls during trading) a filled candle is drawn, usually in red or black in color.

Many online brokers today used the red and green color scheme rather than the white and black color scheme. Trends can be easily seen even by newcomers this way, because green candles signify price increases while red candles indicate that price has decreased.

It's not just designed this way for "newbies", either. Any trader, regardless of experience or skill, needs to be able to have a clear visual system of evaluating data. It's essential to his or her decision making process.

However, moving on from the "history" of Japanese Candlesticks and how they relate to Forex trading - let's evaluate why they're significant.

It's simple: The significance is that they represent our ability to bring simplicity to complex transactions without losing accuracy.

Whether the context is trading rice in the 14th century or trading the Euro/USD currency pair in 2008 from your high-speed connection, the fact remains that you don't have to be an expert to understand and profit from complex markets.

The tools you need to succeed have already been developed. All you have to do is practice using them, and you'll quickly be able to see how what would normally be complex can - through practice and experience - become as simple as any other basic task.

The only question is this: Are you willing to put in the time until it becomes simple?

Ancient rice traders depended on tools like this for their livelihood.

There's no reason why you can't either. And it could end up being a whole lot more valuable than, say, rice.



Ian Armstrong is an avid Forex enthusiast.

He strongly urges beginners to download the free "Forex For Beginners" guide, at Forex Shortcuts

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Foreign Currency Exchange Trading Psychology

Foreign Currency Exchange Trading Psychology by Andrew Daigle

Your Forex Trading Mind Set

Most of the people who engage in Forex trading lose. Indeed, the industry estimates that more traders lose than profit. And they lose for a reason. They have not properly prepared themselves with a Forex education and the proper mindset to be a successful trader. In the cold cruel world of Forex currency trading, you're on your own. It's you against the market. All over the Internet, you can find so called experts touting Forex trading systems with extraordinary sure win claims. If it was so easy, everyone would be a millionaire. The true winners are the ones who have taken the time and effort to carefully devise currency trading strategies that have been thoroughly tested beforehand to produce positive successful results.

Listen to Yourself

You are the only one that can make yourself successful. Everyone is trying to sell some kind of system to fools, who think they're going to get rich instantaneously. It just doesn't happen that way. You can use trading systems and tools to get successful results, but there is no such thing as a free ride. Only through hard work on your part will you be able to develop Forex trading strategies that produce the results that you desire. You should begin your education and training with Forex experts, while building your own skill set to ultimately create your Forex trading system. Forex trading is like any other business. To be a successful forex trader, you need to educate yourself. Great forex traders become better and better because they continue learning. This gives them the edge they need to stay on top of their game so they can go on and become even better traders.

Make Your Forex Trading System Rules

Everyone lives in a society based on rules that must be followed. In the Forex trading markets, except for some simple market procedures and practices, there are basically no rules or structures that govern your operation. You have to take the responsibility for all your own actions. If you win, it's because of you. If you lose, it's not because of the broker, a market, or the government. It's because of you. You have to develop the trading rules and structure to successfully exploit the possibilities that are available in Forex currency trading.

If you are an individual who has a deep confidence in his or her personal abilities, with the discipline to be able to work hard to develop the currency trading strategies necessary for a Forex trading system, then Forex trading is for you. If you have the mindset to be an individual away from the crowd, with no one telling you the rules or laws that need to be obeyed, then you should be part of the minority that enjoys spectacular Forex trading success. Your profit as a successful currency exchange trader can be extraordinary and if you know what you are doing and have the discipline to follow your trading rules, there's no limit to your profit potential.



Andrew Daigle is the owner and author of many successful websites including ForexBoost, a free Forex educational site to learn Forex trading strategies and a Free Forex Training blog for keeping online Forex trading records.

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Forex Trading the Top U.S. Economic News Reports

Forex Trading the Top U.S. Economic News Reports by Andrew Daigle

The US dollar is the most traded currency in the world and an understanding of US economic indicators is important in understanding the US dollar and its role in the currency trading system. Some of the most important U.S. economic indicators include the gross domestic product (GDP), producer price index (PPI), consumer price index (CPI), industrial production (IP), durable goods & services, employment cost index (ECI), retail sales index (RSI) and housing starts. These indicators have the potential to generate volume and move market prices around the globe.

Gross Domestic Product (GDP) - The gross domestic product is a measure of all economic activity in the economy. The GDP represents the total market value of all goods and services produced by both domestic and foreign companies within the borders of the US. The GDP should measure between 3% and 5% for advanced industrialized nations such as the U.S., Europe and Japan. A growth of less than 3% indicates a stalling economy and a growth of more than 5% indicates that the economy is on the verge of inflation.

The U.S. Bureau of Economic Analysis (BEA) publishes two measures of the GDP. One measure is based on expenditures while the other measure is based on incomes. The GDP publishes an advance release of the GDP following each quarter of the year, which contains, among other things, estimates for data not previously released, trade balances and inventories. This is considered to be the most important release while other BEA releases are considered less significant.

Producer Price Index (PPI) - The PPI measures price changes in the manufacturing sector as the average change that domestic producers in manufacturing, agriculture, forestry, electric utilities, natural gas, mining and fisheries receive in selling prices. The PPIs used most often in US economic analyses are measures for crude, intermediate and finished goods.

Consumer Price Index (CPI) - The CPI measures the average price paid by urban consumers for a fixed basket of goods and services. Urban consumers are largest base of consumers, totaling about 80% of the U.S. population More than 200 categories of goods and services are included in the calculation of the CPI. The measure of the CPI includes taxes and user fees connected with goods and service, but it excludes the volatile food and energy components of consumer spending.

Industrial Production (IP) - IP is a chain-weighted measure of the change in production for the nation's factories, utilities and mines. An IP is determined for types of industries and types of markets. Since the IP is a measure of industrial capacity and available industrial resources, IP may also be called capacity utilization. Since manufacturing accounts for about one-fourth of the economy, IP rates indicate the capacity of the country's factories.

Durable Goods and Services - Durable goods and services are a measure of new orders placed with domestic manufacturers for immediately delivery and delivery in the future. A durable good or service is a good that lasts or a service that extends for a period of more than three years.

Employment Cost Index (ECI) - The ECI is an estimated measure of the number of full-time and part-time employees in businesses and government. It is based on more than 500 industries in 50 states and 255 metropolitan areas. Data are collected from surveys of employer payrolls and includes wage as well as non-wage costs of employment.

Retail Sales Index (RSI) - The RSI is an estimate of the total monthly sales from retailers. It is a measure of consumer consumption and confidence. Data are collected from a sampling of retail establishments throughout the country. Retail sales include the sale of services, durable goods and non-durable goods. It includes excise taxes and excludes sales taxes.

Housing Starts - Housing starts is an estimate of the number excavations for foundations of residential properties. An analysis of housing starts measures the change in housing start levels from month to month.



Andrew Daigle is the owner, creator and author of many successful websites including a free forex educational and forex training site called ForexBoost and a Free Forex Training Blog for the Novice and Advanced Forex trader.

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