Forex Trading Videos

Home

Forex Trend Trading With a Simple Moving Average
By Nathan Navachi

While many new forex trading systems are based on complicated mathematical market analysis models, some of the most effective forex trading strategies are also the simplest. One of these simple and highly effective strategies is trend trading, where you simply see which direction the market is trending in and then you trade in that direction. If you were trading the EUR/USD currency pair, the way that you could identify the direction of the trend is to open up a daily chart and overlay a simple moving average on the chart. If the direction of the moving average is up, then the pair is in an uptrend; if the moving average line is down, there is a downtrend; and if the line is horizontal then there may be no trend.

Trend trading is a proven way to earn profits in the forex market since it is an established fact backed by decades of market research that currency pairs (and indeed literally all markets) move in trends. If the trend is up then it makes sense to buy, if the trend is down then it makes sense to sell, and if there is no trend then it may not be a good time to trade. The best way to get an accurate sense of the overall trend is to look at a long-term price chart such as a daily, weekly, or monthly chart and see which direction the moving average line is pointing. While it may not be practical to use a monthly chart for trading signals, it can let you see in a quick glance where the market has been and where it will be headed if the trend continues.

It is a general rule of interpreting trading signals that the longer the period of the price chart is, the more reliable the trading signal will be. This strategy of determining the trend and then trading in that direction could be used on a chart as small as a one minute candlestick chart or as large as a daily or even weekly chart if you are really a long-term trader. Now while trading signals from long-term charts can be more reliable, there is also larger risk involved with keeping a trading position open for days or weeks at a time. If you plan to trade on these types of longer time frames, be sure to factor in the amount of leverage you are using as a function of how many pips you are willing to risk on a loss.

On the short-term side, this strategy can be used on a 1-minute or 5-minute chart but the signals may not be as reliable and the trend itself may be erratic and rapidly changing. It is common sense that the steepness of the moving average line indicates how quickly the market is moving up or down, and if you can identify a fast moving trend on this type of price chart then you open yourself up to large gains if you can enter in on the right side of the market and ride the trend for as many pips as possible before the market retraces itself.

The easiest way to learn forex trading is by watching videos. Go to this YouTube video and watch a video commentary for this article.

Nathan Navachi is a professional trader who built http://TheCurrencyMarkets.com as a valuable resource to introduce the world to the forex market.

Article Source: http://EzineArticles.com/?expert=Nathan_Navachi
http://EzineArticles.com/?Forex-Trend-Trading-With-a-Simple-Moving-Average&id=2690813

Fibonacci - Technical Analysis - Currency Forex - Fx Trading - Daytrading - Retracement - Signal Trading - Forex Training - Demo Trading - Forex Trading Platform

Other videos by this author:

	WMV test Posted by: lylearn Video duration: 440 seconds

	LMF1282008test.flv Posted by: lylearn Video duration: 197 seconds

	LMO1262008.flv Posted by: lylearn Video duration: 236 seconds Test

	Treasury Steps In To "Help" Home Buyers Posted by: lylearn Video duration: 238 seconds

	The Treasury Jumps In to Help Home Buyers Posted by: lylearn Video duration: 238 seconds The Fed is cutting rates but that isn't moving mortgages or housing inventories. However, the new plan to force mortgage rates lower by buying mortgages at below market rates may be a good thing for new home buyers. Will it work? Probably not but you can't blame the Treasury for trying... or can you?

	Fibonacci Analysis For Stocks - Part 4 (buy signals) Posted by: lylearn Video duration: 317 seconds Short term traders may treat fibonacci analysis much differently than longer term investors. However, in either case the analysis can help to time entries and control risk. 100% free stocks and options market education available from http://www.learningm arkets.com.

	Fibonacci Analysis For Stocks - Part Three Posted by: lylearn Video duration: 499 seconds Fibonacci analysis can be enhanced by using time projections. Fibonacci time forecasts are applied to a chart like other Fibonacci studies, and work best when combined with either a retracement or fan study. 100% free stocks and options education available from http://www.learningm arkets.com.

Fibonacci Analysis For Stocks - Part 2 Posted by: lylearn Video duration: 243 seconds Fibonacci fans are very similar in concept to Fibonacci retracements and in many ways they are used the same way. Both are effective tools for identifying support and resistance levels, entries and exits, and stop and price target levels. 100% free stocks and options education available from http://www.learningm arkets.com.

Fibonacci Analysis For Stocks - Part One Posted by: lylearn Video duration: 439 seconds Fibonacci analysis is a way to forecast levels of support and resistance and project price targets. It can be used to set stops as well as timing entries, however, the most valuable information is what it can tell us about risk. 100% free stocks and options education available from http://www.learningm arkets.com.

Market Cap, Diversification and Asset Allocation Posted by: lylearn Video duration: 385 seconds Understanding what market caps are and why a blend of categories can improve your diversification and therefore your portfolio's performance is only part of the problem. You need to be able to find these stocks in the first place. 100% free stocks and options education available from http://www.learningm arkets.com.

	Market Capitalzation and Diversification Posted by: lylearn Video duration: 327 seconds Market capitalization is not just a bit of trivia or market verbiage that you learn as an investor; it makes a real difference in your decision making as you construct your portfolio. 100% free stocks and options education available from http://www.learningm arkets.com.

Using the oil VIX to forecast energy prices Posted by: lylearn Video duration: 499 seconds The formula used to derive the VIX's values can be applied to just about any widely traded index option and that includes oil futures options. Oil prices have a version of the VIX called the Oil VIX (OVX) that operates the same way the stocks version does. 100% free stocks and options education available from http://www.learningm arkets.com.

	Continuation Patterns Let You Know Trends Will Keep Cruisin' Posted by: lylearn Video duration: 538 seconds Continuation patterns form in a few different shapes, but for the most part, they look quite similar. The only real difference you will see is in the shape of the consolidation zone. 100% free stocks and opitons education available from http://www.learningm arkets.com.

Exiting a Long Spread Early Posted by: lylearn Video duration: 465 seconds Traders frequently assume that they cannot exit a spread early but that is not true. In fact, like most other trades if your analysis changes you can exit a position for its current gain or loss at your convenience anytime before expiration. 100% free stocks and options education available from http://www.learningm arkets.com.

Finding Patterns on Your Charts Can Lead to Profits Posted by: lylearn Video duration: 399 seconds When you see a price pattern starting to form, you know that the stock your are watching is starting to slow down, or consolidate, and that you need to slow down, take a step back and evaluate what is happening on your chart. 100% free stocks and options education available from http://www.learningm arkets.com.

	Exiting A Short Spread Trade on the QQQQ Posted by: lylearn Video duration: 331 seconds Exiting a trade is often glanced over in most trader education. That is largely because exits are the stickiest part of the trading process and they are usually the most emotionally disruptive part of the trade. 100% free stocks and options education available from http://www.learningm arkets.com.

Trading a long spread on Google Inc (GOOG) Posted by: lylearn Video duration: 492 seconds Trading a long spread is relatively simple and looks a lot like an ordinary long option position in many ways. In today's video I will finish our discussion on long vertical spreads by demonstrating a long put spread on Google Inc (GOOG.) 100% free stocks and options education available from http://www.learningm arkets.com.

How much can you make on an option spread? Posted by: lylearn Video duration: 294 seconds Unlike outright option positions where you have high costs but unlimited gain potential in a long vertical spread you have low cost and limited gain potential. The trade off can definitely be worth it in the right situation but you need to understand what that trade off is before you enter the position. 100% free stocks and options education available from htt://www.learningma rkets.com.

	Turn Back Time Value Through Spreads on ETFs Posted by: lylearn Video duration: 257 seconds Buying a long option is a great way to speculate on an expected increase or decline in value on a stock or ETF but it comes with a couple of big disadvantages that you have to account for when planning your trades. 100% free stocks and options eductaion available from http://www.learningm arkets.com.

	Option Spreads on IWM - A Better Way to Make Money Posted by: lylearn Video duration: 621 seconds Having already presented the drawbacks and advantages of vertical spreads in the last section of this lesson, we will take a much closer look at a live market example. 100% free stocks and options education available from http://www.learningm arkets.com.

	Options Spreads on the QQQQ - A slower way to lose money Posted by: lylearn Video duration: 508 seconds In this section we will introduce the concept of vertical spreads, which are one of the most common ways to use this trading technique. 100% free stocks and options education available from http://www.learningm arkets.com

	Finding great stocks: Fundamentals the Easy Way - Part 4 Posted by: lylearn Video duration: 569 seconds One of the great opportunities of online investing is the breadth of stock searches available for free. They are very robust, easy to use and often integrated with your online broker. 100% free stocks and options education available from http://learningmarke ts.com

	Finding good stocks: Fundamentals the Easy Way - Part 3 Posted by: lylearn Video duration: 282 seconds Fundamental analysis will not perfectly predict the future of any stock. This is true of all types of financial analysis, however it will provide a very specific benefit. 100% free stocks and options education available from http://www.learningm arkets.com

Finding good stocks: Fundamentals the Easy Way - Part 2 Posted by: lylearn Video duration: 433 seconds In order to really understand why fundamental analysis does not have to be complicated you need to understand some of the most significant misconceptions behind financial reporting as it relates to stock performance. 100% free stocks and options education available from http://www.learningm arkets.com