EUR/USD: Huge EUR Rampage

EUR/USD went on an absolute rampage today, peaking at +400 pips since our last trade yesterday. I honestly can't believe I missed such a huge move (I didn't have internet access all day); but in a sense it's good because I'm always tempted to sell when a pair gains +200 or more pips in a day. So this time I'm going opposite that tradition, and straight buying EUR/USD at its current price (1.3325). I'm being conservative (it is awful late at night) and shooting for a 50 pip gain (1.3375) and then exiting.

***Edit 10:33 PM EST***

Well score a quick 50 pips for me....less than 5 minutes after I initially posted this trade, the pair jumped all the way to 1.3377. Unbelievable! Huge buying pressure on this pair, be very careful trying to short it!!!

Huge EUR/USD Uptrend (And Ranging Pips!)

EUR/USD has been on a massive uptrend for the past couple of days. I recommended buying at 1.2810 and dumping it at 1.2850 to make a quick 40 pips....it appears we exited the trade a bit early as the initial upswing spiked all the way up to 1.2915. I knew the pair was due to hit 1.3000, so I should have trusted my gut instinct...I was just anxious to make back the 20-30 pips I lost on the previous trade and restore my good name :)

Looking at the charts, I'm seeing support around the 1.2885 level (pair currently trading at 1.2995). Looks like the pair has currently peaked, so shorting for a quick gain seems to be our best option. I would aim for the 1.2950 mark and then reassess the market. I don't like trading the wrong side of the overall trend, so make a quick 45 pips and exit the trade.

***Edit 12:15 PM EST***

Ok well our trade got stopped out about 30 minutes after the initial post for a 25 pip loss. Apparently the pair hasn't peaked yet. We'll trade the range to (hopefully) make back our lost pips. Currently the pair is trading at 1.3038, it should range between 1.3045 and 1.3010, so I'm selling until 1.3015 then I'll reverse and buy until 1.3045.

***Edit 1:16 PM EST***

Finally, everything worked out as planned! It was a wild ride, but we made up all of our lost pips, plus an extra 28 in the process! The market ranged exactly as I had hoped, we caught 23 pips selling from 1.3038 down to 1.3015, then 30 buying from 1.3015 to 1.3045. Currently the pair is trading at 1.3047, but I think I'm done trading for the day. Although it hasn't been as profitable as I'd hoped, I'm still 28 pips richer.

Price Action Pips: EUR/USD

We're kind of at a crossroads here with the EUR/USD; there are easy pips available no matter which way you look at it. The currency pair has been in an uptrend over the past week or so, and is currently (12:45 AM EST) trading at 1.2770. This gives us the opportunity to short the pair for a quick 30 pip gain, then reverse and follow the uptrend. I see support around the 1.2740 level, so aim to exit the trade around that price point, maybe even lower (1.2715) if you're feeling greedy.

***Edit 1:15 AM****
Well you bet against the long term trend, sometimes you get burned! EUR/USD spiked all the way to 1.2814 within a half hour of this post. Our new strategy is to buy at 1.2810 and hold until 1.2850. This will help us recoup some of our losses, putting us at +20 pips on the evening.

Easy EUR/USD Pips

EUR/USD has been ranging the past couple of days, although still leaving room for plenty of easy pips. I'm still feeling a bullish trend, however; the pair can't seem to break the 1.2700 mark. So let's use that to our advantage (but remember that at some point, the pair *will* break through that level!). For an easy 30 pips, buy at 1.2635 and sell at 1.2665. If the pair drops to 1.2610, reverse and sell down to 1.2585...we'll reassess the market tomorrow.

More Quick EUR/USD Pips

As predicted in my previous post, EUR/USD dropped down to 1.2615 before starting to rally. Quick pips now...? Short from 1.2685 to 1.2665, then buy and hold until 1.2715. Don't get too greedy as the overall trend is still positive...

Quick Pips on the EUR/USD

Although the EUR/USD is currently in an uptrend, there is some quick cash to be made shorting it. The price should bottom out to around 1.2640 before making another 300+ pip move up to 1.3000.

Forex Avenger Review

I spent the weekend looking over a new forex trading system called the Forex Avenger. It was released on October 28, 2008-so it is pretty fresh and there isn't a lot of information on it. New trading systems always pique my interest, so here is my review of the Forex Avenger.

Forex Avenger is a mechanical trading system. It is not automated, meaning it isn't a forex trading robot or Expert Advisor. It is a trend following system built around 3 indicators. Included with the Forex Avenger is a second trading system called the "Set 'n Sleep System." It is another mechanical trading system, designed for people who work full-time and can't watch forex charts all day.

So does the Forex Avenger work, or is it a scam? The sales page claims the Forex Avenger system wins 82% of its trades. That number seems a bit high, but based on backtesting it for the past 3 months it is a profitable trading system. I believe it actually made a 26% gain in September 2008-not a bad month at all!

What's included with the Forex Avenger? A full ebook (in PDF format) that introduces forex, forex trading, and the Forex Avenger system. The ebook is pretty big (77 pages), and very informative. If you're new to the forex market, this is an excellent guide. Also included are 16 videos about the Forex Avenger and 6 videos describing the Set 'N Sleep system. Lots of example trades are shown, but it is really a simple enough system that you shouldn't have any problems trading it.

If you're looking for an easy to follow, mechanical trading system that is a proven winner, I recommend looking into Forex Avenger.

Price Driven Forex Trading Systems

There are hundreds of successful forex trading systems and strategies, ranging from 5 minute scalping and news trading to long term swing trades. But what is the best forex trading strategy for a new investor? I like to keep it simple, and recommend that new traders start out with a price driven forex trading system.

Why trade a price driven system? The main reason is the overall ease of learning the system. Entry position, exit position, trailing stops, and stoploss are all easily calculated using the rules of the system. It is much easier to manage trades with a price driven system. There are no EA's (expert advisers) or messy fibonacci numbers, no support or resistance levels to worry about, or moving averages to fuss with. You don't need to spend all day analyzing forex charts to trade successfully.

Another benefit of a price driven trading system is they tend to be conservative. It is not uncommon to only make 2 or 3 trades a week. Price driven systems are designed to catch bigger moves in the market, not for short term scalping. Once you are a successful long term trader, you can worry about learning different scalping methods.

Although there are several price driven forex trading strategies available, my top 2 recommendations are: The 10 Minute Wealth Builder and The Forex Trading Machine (Full review coming soon!).

Both of these systems are proven forex winners, and a perfect introduction to price driven forex trading strategies.

Fundamental and Technical Analysis Explained

There are two types of analysis used in the forex market: fundamental and technical. Many currency traders develop trading systems that favor one type of analysis over the other, but it is important to have at least a basic understanding of how each of them function.

Fundamental analysis is the study of various economic and political events, and their influence on the currency market. A weak economy will lead to lower exchange rates, while a strong economy will lead to higher valuation of the country's currency. Interest rates, Gross Domestic Product reports, trade balances, and unemployment rates are the main economic indicators a fundamental trading system will use.

Another important tool for fundamental analysis is an economic calendar. An economic calendar is a listing of all of the important events and economic indicators that affect the currency market, and ranks their importance. It will contain previous figures, what the forecast is, and updated figures as they are released.


Technical analysis relies on using the price history in order to try and predict its future movements. Forex charts are analyzed using a variety of technical indicators. Trend lines, support and resistance levels, fibonacci levels, and moving averages are commonly used to identify what is going on with the market and where it is likely to go.

There are 3 types of moving averages used for technical analysis: simple, weighted, and exponential. A simple moving averages weigh each price point equally over a specific period of time. These price points are averaged, and a line is drawn on the chart. A weighted moving average will place more emphasis on the latest data. Weighted moving averages tend to give more accurate volatility estimates than simple moving averages do. Exponential moving averages are calculated by multiplying a percentage of the most recent price by the previous periods average price. Exponential moving averages will respond to recent price changes much faster than simple moving averages will.

Forex Trading System: 10 Minute Forex Wealth Builder Review

I've spent the last couple of weeks looking over various forex trading systems, trying to find a strategy that would work for a complete forex newbie. Although I like "automated" (or robot) trading systems, I think they can be too dangerous for a new investor. You should really understand how the forex market works before relying on a script to trade it for you. That being said, I believe I have found an excellent forex trading system for newbie (or experienced) forex traders: Dean Saunders's 10 Minute Wealth Builder.

The heart of the system is basically using trendlines, support, and resistance to determine when to enter and exit your trades. There are rules in place that determine your stop-loss and take profit points. The system is geared towards large market moves, not for day trading. Trading all major currency pairs, you can expect to have 3-5 trades per week. Dean claims his system wins 60-70% of all trades, with the average winning trade being twice as big as the average losing trade. This means that over the long term, the 10 Minute Wealth Builder should definitely make you some money! Please note that no system produces 100% winning trades, and trading the forex market can be risky. Do not invest money you cannot afford to lose!

Why is Dean Saunders's 10 Minute Wealth Builder a good forex trading system for newbies?
It takes a simple, conservative approach to trading. Dean provides detailed video tutorials on reading charts, as well as money management. You don't need to use any complicated indicators or EA's to identify entry and exit points. Everything you need to know to successfully trade forex is covered in this course.

Bid Price, Ask Price, and Spread

Currency quotes are always listed in pairs; the base currency listed first, and the counter-currency listed second. A currency quote will look something like this:

EUR/USD 1.4050 / 1.4052

or

EUR/USD 1.4050 /52

In this case, Euro is the base currency and US dollars are the counter currency. 1.4050 is the current Bid (sell) price. It represents the price at which other investors are prepared to buy the currency from you. 1.4052 is the current Ask (buy) price. It is the price at which you can purchase the currency. In forex, the bid price is always lower than the ask price.

The spread is the difference between the bid price and ask price. In the above example, the spread is 2 pips. A pip (percentage in point) is simply the smallest value of measurement for currencies on the forex market. A pip is equal to .0001, or 1/100 of 1%.

Forex for Newbies

What is Forex?

The foreign exchange (forex, or fx) is the international marketplace for currency exchange. It is the largest financial market in the world, with over $3.9 trillion dollars traded daily. Unlike the stock exchange, there is no centralized market. Instead, currencies are exchanged 24 hours a day, except from 4PM EST Friday until 3PM EST Sunday. Forex is considered an over-the-counter (OTC) market, with most business being conducted electronically (over the internet) or by phone.

So What is Being Traded?

The simple answer: Money! Forex differs from other markets in that instead of buying (or selling) a stock or commodity, a currency exchange involves both buying and selling, simultaneously. You sell one currency in exchange for another. All currencies are listed in pairs, with the first currency being the base currency and the second currency being the counter currency. The base currency is the currency being bought (or sold) and the counter currency determines the profit (or loss). The 7 major currency pairs exchanged on the forex market are: Euro vs. US Dollar (Eur/USD), British Pound vs. US Dollar (GBP/USD), US Dollar vs. Japanese Yen (USD/JPY), US Dollar vs. Swiss Franc (USD/CHF), US Dollar vs. Canadian Dollar (USD/CAD), Australian Dollar vs. US Dollar (AUD/USD), and New Zealand Dollar vs. US Dollar (NZD/USD). All of the major currency pairs involve the US dollar, although there are several currency pairs (called cross-currency pairs, or crosses) which don't. The most actively traded crosses are: Euro vs. Swiss Franc (EUR/CHF), Euro vs. British Pound (EUR/GBP), Euro vs. Japanese Yen (EUR/JPY), British Pound vs. Japanese Yen (GBP/JPY), Australian Dollar vs. Japanese Yen (AUD/JPY), and New Zealand Dollar vs. Japanese Yen (NZD/JPY).