Choosing a forex currency trading system is the first and most important decision a new trader has to make. Picking a good system to follow can literally make or break you, so it’s worth investing the time to learn how to choose the good systems from the bad.

This short article will help you quickly identify potential forex trading systems using a very simple 4-part process.

Before we get started, it’s important to know the problems that most forex currency trading systems have so you can easily disregard flawed systems before investing time and money in them.

– Most systems don’t teach a proven system for success. Instead of giving you a step-by-step plan, they teach incomplete and often inaccurate theory that does nothing more than confuse you.

They expect you to understand extremely complicated fundamental trading strategies instead of teaching you simple technical trading strategies that can be grasped in minutes not hours.

They ignore risk management and don’t teach you how to protect your capital. Even worse, they tend to lean towards riskier trading strategies that compound your losses.

Now that you can spot a flawed trading system, let’s take a look at the 4-part system you can use to identify trading systems that have a good chance of success.

Over the years I’ve seen dozens of trading systems come and go, and I’ve developed my own proprietary system for quickly picking systems that are worth investing in. If you follow these 4 steps and ensure any trading system you invest in meets these criteria then you will greatly increase your chances of success in forex.

Step 1. The system must show you a step-by-step plan for success. You need to have setup conditions, entry, stop and exit rules, and completely eliminate chance from the trading process.

Step 2. The system must teach you proven technical analysis strategies that are simple to understand and easy to implement. It should also require some thought and not be completely automated.

Step 3. Your trading system should not be time consuming and should not need you to be chained to your computer all day. It should be flexible and require only a few minutes each day.

Step 4. The system must use a complimentary risk management strategy that protects your capital and removes virtually all the risk in every single trade.

If you follow these simple steps when evaluating a forex currency trading system and ensure the system you pick meets all the criteria you are almost guaranteed to invest in a system with a very good chance of success.

Remember in forex there will always be some element of risk, and no system is perfect, so use your own judgement along with these guidelines and you’ll greatly increase your chances of picking a winning system.

Technical forces and fundamental forces are the two main drivers of the forex markets. They both give you valuable information but is one better than the other?

Technical forces are a reflection of fundamental analysis at the current market price. While fundamental forces include things such as money supply, interest rates, economic and financial reports, balance of trade data, and things of that nature.

In the past, most professional traders have primarily used fundamental analysis to determine their trades. With many hours each day devoted to trading they were able to invest the time required to do this type of analysis properly. However most amateur traders simply do not have the time it takes to do this type of trading properly, without taking short cuts and seriously compromising their data.

For professional traders, this isn’t as much of an issue. Because they trade 24/7 and are always watching the markets, they are able to trade with the precise timing you need to move with the markets. This is why fundamental traders are never far from their trading platform and are always ready to trade.

Amateur traders on the other hand don’t usually have the many hours required on a daily basis to watch the markets and react in time. When they do try to trade using fundamental analysis they often get taken for a ride as they are simply too far behind the market to realize profits. 

The key to understanding how fundamental analysis works is realizing that the underlying market data is NOT important. All you need to be concerned with is the market’s reaction to that data.

One thing many traders don’t realize is fundamental data is projected — and those projections change when news reports come out, but they are NOT created by the news reports. It’s a small distinction but one with far reaching meaning. It makes the timing of analysis the most important thing, and it means you profit from the swing in market direction.

However, trading on technical analysis requires much less time involvement and gives you flexibility, maneuverability and agility in the markets. Because technical analysis reflects the fundamental analysis at the current market price, that means the market has done the fundamental work for you. You literally skip ahead and let everyone else do the hard work. You then ride a trend based on your trading conditions.

As you might have guessed, trend spotting is a crucial skill in technical analysis. Successful technical traders are able to identify, confirm and enter a trade with just a few key indicators. And they give themselves enough time in the trade to realize profit targets while identifying, confirming and exiting the trend before it comes to an end.

This is why I advise new traders (and pro’s alike) to trade based on technical analysis. You leverage all the hard work done by the fundamental traders without exposing yourself to the time, energy and effort required to do all the work. Because of this you can trade in just a few minutes each day and still make more money on a consistent basis.

If you want the best chances of success in forex, you should look for a Forex Training Course that uses technical analysis, such as the Forex Profit Accelerator.

In the last few years forex trading has become one of the most popular markets for new traders to enter.There are numerous reasons why forex is more popular than trading stocks and why you should choose to get in the game. This article will take a look at the most important ones.

For the most part the benefits are the same, as are the risks, but there are a number of reasons that have made forex the default choice for new traders to get started with.

The first key difference is market volatility. You see, the profits in trading come from price movements, and the greater the price movement the greater the potential for profit. When it comes to trading, volatility is a good thing.

Abrupt price swings in forex pairs allow for large profit potential that you simply cannot get in the stock market.

The differences between stocks and forex are enough that you should choose a trading method designed for forex trading, as it will help you take advantage of volatility in the market while keeping risk to a minimum.

Leverage is the other key difference that sets forex apart from other types of trading. It’s quite normal for brokers to offer 100:1 leverage, which means you can take large positions with a small account, and make profits like the big boys. Whereas in the stock market you’d need the full account balance to make a large trade, which puts large profits out of the reach of most ordinary traders.

Of course, with leverage comes risk. Remember to pick a forex online trading course that has built in risk management techniques to keep your account balance safe.

These are the key reasons forex has become so popular, and is so well suited to new forex traders. Leverage, small margin requirements and great profit potential make it the perfect choice for almost anyone serious about making money in the markets.