Demo trading vs. live trading.
By Tom Long | February 20, 2008
Many times new traders who have done well in a demo account open up a live account and things start to fall apart. Having real money on the line is very different emotionally than trading pretend money. When losing in a live account, every pip can result is feelings of frustration or pure joy. These emotions can cause traders to make different trading decisions in that live account than were made when trading in the demo account. This usually leads to more losing trades. But trading live and making the same decisions when no money was at risk is key to your success as a trader. No matter how hard you try, you cannot move up to the next level of trading until you learn how to risk real money. That what trading is all about. The key is to open that live account and to start out slowly. In our Power Courses, where we teach people about trading, we recommend new traders start out trading only one mini lot at a time. Keep your risk small in the beginning until you feel good about the decisions you are making. Trading in a demo will not help you practice this; you can only learn how to deal with this using real money. But that does not mean you have to take on a lot of risk to prove anything to anybody. You are just moving up to the next level of trading. Take your time, as the more practice you get trading live, the better chance you have at being a profitable trader.
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DailyFX Forex Radio - US Dollar Awaits Critical CPI and FOMC Releases, Oil Surges to Record on Dollar Weakness
By DailyFX Radio | February 19, 2008
Listen to our Evening DailyFX Forex Radio PodCast:
http://media.dailyfx.com/podcasts/FXRadioPM021908.mp3
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Key Points
· US Dollar plummets on speculative currency trading momentum
· Oil and Gold prices surge to new heights on clear dollar weakness
· Dollar outlook will depend on critical Consumer Price index and Federal Open Market Committee reports
Tell us what you think of our podcast and send us an e-mail at research@dailyfx.com
To chat with us and other traders about currency trading, visit our very popular Forex Forum
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DailyFX Forex Radio - US Dollar Momentum Firmly to Downside on Bearish US Economic Outlook
By DailyFX Radio | February 15, 2008
Listen to our Evening DailyFX Forex Radio PodCast:
http://media.dailyfx.com/podcasts/FXRadioPM021508.mp3
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Key Points
· US Dollar plummets on dismal University of Michigan Consumer Confidence data
· Relatively empty calendar leaves opportunity to sell euro against British pound
Tell us what you think of our podcast and send us an e-mail at research@dailyfx.com
To chat with us and other traders about currency trading, visit our very popular Forex Forum
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Forex Radio - US Dollar and Carry Trade Drop on Bernanke Testimony, Further Losses Ahead?
By DailyFX Radio | February 14, 2008
Listen to our Evening DailyFX Forex Radio PodCast:
http://media.dailyfx.com/podcasts/FXRadioPM021408.mp3
Key Points
· US Dollar loses ground on Federal Reserve growth downgrades, Bernanke testimony
· Australian dollar and rest of carry trade take a hit - where to next?
Tell us what you think of our podcast and send us an e-mail at research@dailyfx.com
To chat with us and other traders about currency trading, visit our very popular Forex Forum
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What is Slippage?
By Tom Long | February 14, 2008
You bought the EUR/USD at 1.4000 and the market is now trading at 1.4025. Since there is an economic release due out in 15 minutes, you move your protective stop up to 1.4000 to protect your winning trade from turning into a losing trade. The number is released and the market trades down through your stop level to as low as 1.3975 in a matter of seconds. But instead of getting filled at your price of 1.4000, you are filled at 1.3990 and now have a losing trade on your hands. Why? The answer is that there was nobody willing to take the other side of the trade at your price. A trade is when two people agree on price but disagree on value. One thinks the value is too high and the market should move down while the other thinks the value is too low and the market should move up. When a major economic number is released, the volume dries up as most big traders stand aside. They will not trade if they cannot identify their risk. So there is not as much volume as you would see in a normal market environment. However, there are still plenty of traders trying to take advantage of the volatility. They will all want to trade in the direction the market should take based on the number released. So if everybody thinks that the market is going down, all these traders try to sell at the same time. The problem is that there are not many traders looking to buy if the market is falling quickly. So the market continues to fall until the buyers step in and start taking the other side of the trades. But they are buying at their price, not yours. In the example above, a sell stop order becomes a market order once the price designated is printed. So when the market traded down to your stop level of 1.4000, your order then became a market order. When you are selling at the market you are matched up with somebody who is buying. If they are only buying below your sell stop price, you will be filled at that level. This is called slippage and it is present in every market in the world. So if you are trading in a volatile market environment, you have to be prepared for slippage. It is the nature of the game.
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DailyFX Forex Radio - US Dollar Sees Tepid Reaction to Retail Sales, British Pound Rallies Big on Bank of England Rhetoric
By DailyFX Radio | February 13, 2008
Listen to our Evening DailyFX Forex Radio PodCast:
http://media.dailyfx.com/podcasts/FXRadioPM021308.mp3
Key Points
· US Dollar sees tepid reaction to Advance Retail Sales release, all signs point to further Fed Rate Cuts
· British Pound continues rally on hawkish Bank of England rhetoric - no more BoE rate cuts?
Tell us what you think of our podcast and send us an e-mail at research@dailyfx.com
To chat with us and other traders about currency trading, visit our very popular Forex Forum
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DailyFX Forex Radio - US Dollar Awaits Key Advance Retail Sales Report, Why Did the British Pound Rally?
By DailyFX Radio | February 12, 2008
Listen to our Evening DailyFX Forex Radio PodCast:
http://media.dailyfx.com/podcasts/FXRadioPM021208.mp3
Key Points
· US Dollar awaits critical Advance Retail Sales report after dismal Philadelphia Federal Reserve reports
· British Pound rallies despite weak Consumer Price Index data - What gives?
Tell us what you think of our podcast and send us an e-mail at research@dailyfx.com
To chat with us and other traders about currency trading, visit our very popular Forex Forum
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DailyFX Forex Radio - US Dollar Sees no Help from G7, Australian Dollar Sees Big Boost from RBA
By DailyFX Radio | February 11, 2008
Listen to our Evening DailyFX Forex Radio PodCast:
http://media.dailyfx.com/podcasts/FXRadioPM021108.mp3
Key Points
· The first drop in US nonfarm payrolls in four years and the dollar ends the day higher, what gives?
· With the FOMC cut behind us, we now look to the RBA, BoE and ECB rate decisions.
Tell us what you think of our podcast and send us an e-mail at research@dailyfx.com
To chat with us and other traders about currency trading, visit our very popular Forex Forum
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DailyFX Forex Radio - US Dollar Softens As UK Inflation Pressures Persist, RBA Remains Hawkish
By DailyFX Radio | February 11, 2008
Click Link to Listen to our Morning DailyFX Radio PodCast:
http://media.dailyfx.com/podcasts/FXRadioAM021108.mp3
Fundamental Headlines
• AUDUSD – The release of the RBA’s Quarterly Monetary Policy Statement reiterated the bank’s hawkish bias. While the statement noted that the bank “had to take into account sharply contrasting domestic and international developments,” the RBA remained focused on “uncomfortably high” inflation risks and commented that “(a)bsent a further shift in economic risks to the downside…monetary policy is likely to need to be tighter in the period ahead.” For more news and resources, visit the new Australian Dollar Currency Room.
• GBPUSD – UK producer price input costs rose 2.6 percent from December and pushed the annual rate up to 19.1 percent, which is the highest level in nearly 28 years. Meanwhile, output price growth accelerated quite a bit, with the monthly rate jumping 1 percent to bring the annual rate up to a 16-year high of 5.7 percent. The news will not be of comfort to inflation hawks on the BOE’s MPC, especially ahead of tomorrow’s CPI release. However, much of the increase is a result of sky-rocketing petroleum product prices during the month, as oil hit a record high of $100.09/bbl on January 3. As a result, we could see inflation-related figures start to fall lower in coming months, as energy price gains have moderated since then. Discuss the topic and your trade ideas in the GBP/USD Forum.
Podcast by Terri Belkas, Currency Analyst, Forex Capital Markets LLC, DailyFX.com
Contact: tbelkas@dailyfx.com
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DailyFX Forex Radio - Dollar Finishes Week on a High but Watch out for G7 Meeting Communique
By DailyFX Radio | February 8, 2008
Listen to our Evening DailyFX Forex Radio PodCast:
http://media.dailyfx.com/podcasts/FXRadioPM020808.mp3
Key Points
· US Dollar finishes on a high despite speculation of OPEC change to dollar peg
· Upcoming G7 Communique to provide further guidance on US Dollar outlook
Tell us what you think of our podcast and send us an e-mail at research@dailyfx.com
To chat with us and other traders about currency trading, visit our very popular Forex Forum
Want to hear our PodCasts daily? Subscribe to them for free on iTunes
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