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A Guide To FX Programmes and Their Systems

FX Trading Guide

Beginner FX traders will often enter the foreign exchange market with many questions about FX trading.  One area commonly questioned is forex programmes, or trading systems.  In order to make trading smoother, the first step should always be gaining some foreign exchange education.

Are FX training programmes worthwhile?

If you decide to use an online or live course rather than opting for books, magazines or newspapers, you will obtain more information and interaction.  You will be able to ask questions and get answers, rather than trying to figure out all the jargon by yourself.  Seeing or hearing questions asked by other traders can be highly valuable, as you may not have thought about the same problem they are facing.  If you are in a classroom setting, be it online or live, you will learn from the frustrations, mistakes and experiences of others in the same position as you.

If you opt for a mentorship programme, you will get the benefit of personal experience.  Your mentor will have extensive experience in this financial market and you will be able to draw on that experience and not make the same mistakes.  This will save you money and time.

Which is the best FX trading style?

Everyone trades differently from their neighbour, but to find a good trading style you will probably have to combine fundamental with technical analysis.  It is possible for fundamentals to skew technicals, while the technicals can often explain movements that fundamental analysis is unable to understand.  To be a smart trader you should be aware of both analyses in every trade you make.  Combining the two will prevent you from making as many bad trades, and is suitable for use by both swing and day traders.

What are FX signals and FX trading systems?

You, like many other FX traders, may be wondering if it is worth your while to buy a forex signal service.  These software programmes allow you the opportunity to make trades based on various data inputs.  Signals and systems generally fall into three categories which are dependent upon their target, be it range, fundamental or trend.

Fundamental systems are extremely rare in this market as they are generally used by the large hedge fund and large financial institutes.  This is so due to the long term nature of fundamental strategies which limits the number of trading signals.

Individual traders are able to gain access to trend or range systems.  It is very rare that you will find one system that exploits both these markets.  If you can find a suitable system that does that, you would have found the perfect system.

Most of the large traders wish that they could find software that will indicate if they are currently in a range or trend-bound market.  Most of the large hedge funds tend to follow the trend system.  It has been found that range-bound systems perform well only in range-bound markets.  By using trend systems you are likely to make money in trend-bound markets and lose funds in range markets. However, you could make money in a ranging market too.

When you make the decision to buy a system, or sign up with a signal provider, you should make the effort to determine whether the signals provided are trend or range-bound. Review the products thoroughly before you part with any cash.



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