Being a Forex beginner

We all were beginners one day... This article is for everyone who decides to step on a path of Forex trading career. An overwhelming amount of information about Forex can leave an average newbie quite discouraged: What to do first? Where to start? Will I ever be able to comprehend everything about Forex trading?

Those and many other questions will be answered here in our tutorials and lessons.
A step-by-step solution offered should leave no questions about successful starting of a Forex journey. But if you do have questions left, just any questions about Forex trading, you are very welcome to ask it here: Newbie questions and Answers board. No stones will be leaved unturned!

And for the end of this introduction, let us encourage you, first of all to be persistent in day to day learning, and most importantly, enjoy discovering Forex; you would need those two qualities in order to complete at least 2 years(!) of Forex beginner journey... Why at least 2 years? Because there is so much to learn in Forex and even much more to practice upon. Imagine, that you are studying to get a profession in finance at university, how long would it take to graduate?

Taking Forex career seriously means being ready to study and practice for several years without a second thought. And while some university subjects are boring, Forex isn't, it is rather exiting! Welcome and happy Forex learning!

Source : forexbeginners.net

Ask and Answer for Beginer forex trader about Timing

Ask : How to calculate the est timings?

Answer : EST = GMT - 5. You should find out your local time zone. To do this either look at your PC time zone, or better go to http://www.timeanddate.com/worldclock/ and in the search field type in the country you live in. Then calculate the correspondent EST hours for your local area. Also the timing tool at: Forex market hours can help at some point.

Ask : I heard that one should not trade on Mondays because it has more down days. But if that is true then it would seem that one should not trade long on Mondays, but trading short (assuming the trend is down) on Mondays would be a good thing. Did I misunderstand whats wrong with Mondays for trading?

Answer : It appears that you have misunderstood the statement. When they say that Mondays have more down days, they mean that on Mondays traders have a higher rate of unsuccessful trading. On Mondays the market is often unstable, deciding on which direction to pull this week, what market levels to obey and what to disregard. Unless there is a crystal clear trend imprinted in the price, traders try to avoid trading on Mondays to lower the percentage of losing trades.

Ask : I live in UK, what time on monday or sunday would I use for the start of the week for trading. Also once the week has began what is the daily time for my calculation.

Answer : Use GMT - your local time zone. Start trading on Monday, around 6-7am GMT if the trend is obvious and trading signals are clear, otherwise it is suggested to wait till Monday shake-up occurs in the market as it looks for its trend options. If you want to calculate Pivot points, New York time (EST) is recommended. EST = GMT - 5. Also majority of breakout methods are tailored to EST time. In all other cases you can confidently take GMT time - and base your calculations around 00:01am - 11:59pm GMT.

Ask : What is M15 timeframe?

Answer : M15 stands for 15 minute time frame.
Other examples:
4h - 4 hour time frame, or you can also say - 4 hour chart.
1d - daily time frame, 1 day chart.
5m - 5 minute chart.

Ask : Im abit confused about the openning time for london forex market. Is it at 5:00am or 8:00am ? And how about the timing of the platform of those Meta4 trader, are they GMT ? Are they all auto adjusted to day light saving ? ( what is the duration of day light saving ).

Answer : London market opens at 8am GMT. Different Forex brokers have different default timing settings for the Metatrader Platform offered. Those settings cannot be changed. You should ask your broker what timing their trading platform uses. All platforms are auto adjusted to daylight savings. Here is additional information on the calendar and duration of daylight saving periods in the world. http://www.timeanddate.com/worldclock/city.html?n=136

Ask : If I traded before daylight savings time fall 2007 and up to end of feb 2008 at 5:00 pm mountain time, which is 0:00 GMT time. Would I still trade the same time or do I need to adjust my strategy back 1 hour as we moved our clocks forward 1 hour? I noticed today that 0:00 is now at 6pm mountain time?

Answer : Yes, as we switch to daylight saving time and back you adjust your strategy time accordingly.

Ask : Please i need your help about the timing because am in Nigeria and we are an hour ahead of GMT (GMT+1). Kindly help with the best time for me to calculate my pivots for both London and America market on 15 minutes chart.

Answer : Ok, let's use the time from 00:00 Eastern time to 00:00 next day Eastern time to calculate Pivot points. Let's not just do it one time, but learn how to do it each time when we require to perform similar time matching tasks.

1. Go to http://www.forexmarkethours.com/
2. Choose your local time zone in the window application. Press "Go!". Note the time in the green box next to it.
3. Now choose "GMT - 5 Eastern Time (USD, Canada)" in the same application. Press "Go!". Note the time in the green box again.
4. Find the difference in hours.

Using the rules above, for you time zone currently we have 5 hours difference (its daylight saving time in US). Therefore, since we want to Calculate pivots from 00:00 to 00:00 EST, in your local Nigeria time it will be from 5:00 am to 5:00 am EST. Same way we find the difference for London hours. Because of daylight savings your Local time now is the same as in London. No additional calculations required.

Ask : hello, am very new to in forex trading and will want to get myself fortified before activating my live act. the issue now is I will to know how daylight savings affect different forex market opening hours thank you

Answer : During the 2 weeks period when daylight savings is activated in different countries across the globe, it does confuses traders as to what hours to use. We suggest monitoring the time with Eastern Time time zone (New York time). Some traders may find useful switching their PC local time to Eastern Time to monitor hours effectively. Also http://www.forexmarkethours.com/ will always tell you what markets are currently open regarding your local time zone and according to daylight savings adjustments.

Beginners Forex Trader - What is drawdown?

A DRAWDOWN is a percentage of an account which could be lost in the case when there is a streak of losing trades. It is a measure of the largest loss that a trader's account can expect to have at any given moment or period of time. Streak of losing trades or a LOSING STREAK - a period of consecutive losses with no profitable trades.)

You'll see the term "drawdown" being used when describing a trading system. Before trusting any particular system, a trader wants to know what is the largest loss he can face when he starts taking losses due to changes on the market that would lead to a temporary worsening of a performance of a trading system. For example, if a trader put $5000 to trade with and later he has lost $2500. This would be 50% drawdown.

Another example: you may hear that a trading system is 80% profitable, (which would logically mean that the remaining 20% of the time will produce losses). What a trader cannot predict is in what sequence the profits and losses will come... Will it be 8 consecutive profitable and 2 losing trades every time? Will it be 10 consecutive losing trades and then 3 profitable, and then 5 losing and then 15 profitable? It is impossible to tell in advance. However, by testing a system, a trader can look back ad find the largest period of losing trades - the largest losing streak - this is what would be called a MAXIMUM DRAWDOWN for a particular system, and this is what a trader should be prepared to.