Forex Market

With the experience in forex trading comes a rather disappointing realization that forex is difficult. You have read the basics, you have learned the indicators and charts, and you even found the right broker and opened a demo account. You’ve got the tools, the tricks and a “winning” strategy. If everything is in order, how come you are still not on the way to forex riches? Where are the promised piles of money?!

The advice you hear the most from other forex traders is to develop your own trading strategy. Plan it well and trade according to it. Be disciplined and follow the trading plan religiously. You spend months polishing up your strategy in hopes that now you have cracked the code of forex market.

The truth is, forex market is dynamic and elastic. Forex market does not follow anyone’s rules and guidelines, especially not your detailed and strict trading plan. In order to be successful, you have to become dynamic and elastic yourself. In other words, instead of trying to mechanize it, you have to FEEL it.

Think about it. If automated mathematical EA was a perfect solution, there wouldn’t be a need for traders at all. EAs do not react right to news and sudden market moves. If you rely on EAs, an unexpected turn in price can wipe your account clean within seconds. I guess, no matter how advanced the technology is, there is no substitute to human touch, even in forex.

When you trade manually, you follow the basic principles and, at the same time, you are aware of the news and the possible market swings. The instincts play an important part in trading. You trade your plan when it feels right.

Now, here is another thought – what makes the market move? Imbalance of supply and demand? Economic factors and financial news? Political fluctuation and instability? Greed and fear? Market psychology and traders perceptions?

People move the market. Millions of forex traders just like you are in front of their computers starring at the same charts, buying and selling, analyzing, seeing the same patterns and making decisions. The traders’ decisions are based on emotions, trading trends, technical trading and/or intuitive techniques etc. By traders I mean both independent traders and huge financial institutions such as banks, since they are also controlled by people! In the center of it all stands the ultimate winner – a broker. Around the broker, some traders win, others lose.

So how does EA mixes in all this? Why are there so many so called “Holy Grail” trading strategies? With EA traders try to predict. Even when the market may seem random, it is still driven by people who expect the market to repeat itself. And this is the true reason why it does.

On one hand, manual trading can be more profitable, since a forex trader can read the market continually with manual trading and therefore spot a fundamental event which may change the direction of the price despite the technical analysis factors.

On the other hand, there is a psychological disadvantage of manual trading - a trader may close a trade as soon the money seems to decrease (retracement) just to see the price turn around again. Therefore, set and forget technique may be less profitable, but it is sure easier on your nerves.

To summarize:

· The percentage of traders who actually follow a trading strategy is slim since it is important to bend the rules once in a while and follow the instincts.

· The percentage of successful traders who use common sense, their knowledge and their intuition to make a decision is low since many beginners in forex trading are dropping out after couple of unsuccessful tries to hit the jackpot!

Forex

The foreign exchange market (currency, forex, or FX) trades currencies. It lets banks and other institutions easily buy and sell currencies.

The purpose of the foreign exchange market is to help international trade and investment. A foreign exchange market helps businesses convert one currency to another. For example, it permits a U.S. business to import European goods and pay Euros, even though the business's income is in U.S. dollars.

In a typical foreign exchange transaction a party purchases a quantity of one currency by paying a quantity of another currency. The modern foreign exchange market started forming during the 1970s when countries gradually switched to floating exchange rates from the previous exchange rate regime, which remained fixed as per the Bretton Woods system.

The foreign exchange market is unique because of

• its trading volumes,
• the extreme liquidity of the market,
• its geographical dispersion,
• its long trading hours: 24 hours a day except on weekends (from 22:00 UTC on Sunday until 22:00 UTC Friday),
• the variety of factors that affect exchange rates.
• the low margins of profit compared with other markets of fixed income (but profits can be high due to very large trading volumes)
• the use of leverage

Main foreign exchange market turnover, 1988 - 2007, measured in billions of USD.

As such, it has been referred to as the market closest to the ideal perfect competition, notwithstanding market manipulation by central banks. According to the Bank for International Settlements,^[2] average daily turnover in global foreign exchange markets is estimated at $3.98 trillion. Trading in the world's main financial markets accounted for $3.21 trillion of this. This approximately $3.21 trillion in main foreign exchange market turnover was broken down as follows:

• $1.005 trillion in spot transactions
• $362 billion in outright forwards
• $1.714 trillion in foreign exchange swaps
• $129 billion estimated gaps in reporting

Benefits of Debt Consolidation

If you have several credit cards with outstanding balances in the thousands of dollars at a high interest rate, outstanding medical and dental bills, a student loan, store credit or other unsecured debts, debt consolidation can be a way for you to make only one payment a month rather than payments to each creditor.
payment may be less than the total payments to all your creditors. You can pay off your credit card debt.

The benefits of debt consolidation include:

Lower payment The consolidation loan payment can be much lower, as much as 50% lower, than all the other payments combined. This gives you some breathing room in your budget.

Only one monthly payment rather than one for each creditor. This saves you time because you write only one check. It also saves you money because you don't have to send a check to each creditor. There are no credit card annual fees, transfer fees, membership fees and of course no more late fees. It's easier for you to keep track of your loan balance as well.

A lower interest rate is most likely on the new loan when compared to the somewhat exorbitant interest rates most credit cards carry. Credit card interest rates can reach 25% a year while most consolidation loans range from 6% to 8%.

Peace of mind. No more creditors calling at your home and place of work. No more struggling trying to figure out which bill to pay this month and which has to wait until next month. You can relax and get back on track knowing that you only have to make that one lower payment instead of all those payments.

Damage to your credit standing is reduced. Debt consolidation means your creditors are paid in full. You can begin to rebuild a solid credit report. Of course it makes sense that you close most of these accounts, perhaps keeping one credit card for emergencies only.

Debt Consolidation - Consolidate Loans & Credit Card Bills

Debt consolidation is a form of debt management where you are able to work with an experience credit counselor to find a loan and method of debt consolidation that can help get your finances under control and plan for a stronger financial future. You can use this method to consolidate credit card debt and should consider it before bankruptcy or your other drastic financial measures take over. Credit card debt affects millions of households around the world. When you are looking for a way out from under suffocating credit card debt, you need a plan that will work now and prevent debt in the future. Debt consolidation can offer that.

First, take the time to find a credible debt consolidation company and make sure they have credit counselors experienced in credit card debt. The best method is to work with a local debt consolidation office (as opposed to an online company) because of the heightened level of responsibility and ability to check them out. You can contact your local BBB or financial regulatory agency to find out if the debt consolidation companies you are considering are reputable.

Next, meet with them about the services they offer to find a company who will give you what you need in the way of credit card bill relief. You should not be asked for payment until the services have been completed and they should be offering you a range of services to find relief from your debt. Included in these possible services should be debt negotiation and credit counseling. Debt negotiation helps settle your debt for lower amounts and credit counseling helps you plan for the future.

Once you are through the process of finding the right credit counselor to work with they should walk you through the process in the easiest and most reassuring way possible. You should feel confident about your journey and have hope in the future for your credit card accounts. The credit counseling is important and you should pay attention and work with the credit counselor to make sure you have a plan in place to help you avoid making the mistakes that got you into debt and instead learn how to budget, plan and spending your money wisely. You can find a way to consolidation credit card debt and plan for a stronger financial future with a little help.

Using a debt consolidation loan can help you save thousands of dollars in interest costs and fees.

How to Consolidate Loans?

1. Get your credit report and FICO score. Any loan you get will be based largely on your credit score, so you should find this out. However, if your credit score reveals that you actually score quite well and have a reasonable credit rating, you may easily be able to consolidate loans at a lower rate, especially if your credit has improved since you got the loans. Go over your entire credit report carefully to make sure it's accurate. Inaccuracies can hurt your score and keep you from getting the rate your deserve.
2. Consider all your options. Before you jump into a debt consolidation loan, think about your other options.
   
   
   • If you just want to save money, but you're not in dire straits, simply pay off your debts fast by prioritizing them. Pay as much as you can each month on your highest-rate loan while making minimum payments on your others. This way, you are able to lower your monthly finance charges as quickly as possible.
   • Call your credit card company. If you have relatively good credit, you may be able to simply talk to your credit card company and negotiate a lower interest rate. If they won't give you a lower rate, you may be able to transfer your balance to a credit card with a lower long-term rate or a no-interest introductory rate--just make sure you know what your rate will be after the introductory period.
   • Contact a credit counseling agency. A reputable credit counseling agency can provide you with free or low-cost advice on how to manage your debt, and they can help you prepare a budget to get your finances under control. Credit counseling, however, does not necessarily mean entering into a debt management program, and you should beware any organization that tries to push you into such a program immediately. In general, be careful when choosing a credit counseling agency. Even agencies that are registered non-profits frequently charge high fees.
   • Sell your car. If you can't afford your car payments, try to sell your car to pay off the loan. If the car gets repossessed, it will end up costing you even more money.
   • Talk to your mortgage lender. Reputable mortgage lenders will usually work with you if you have some temporary trouble paying. Call them as soon as you know you'll have trouble, and they may temporarily suspend your payment or accept reduced payments. You might also be able to extend the time for repayment, thereby reducing your monthly payments. Make sure you find out about any additional fees or penalties for any arrangement, and consider refinancing your home if you can get a better interest rate.
   • Borrow from your life insurance. Whole life policies usually allow you to borrow against the cash value of the policy. This easy, usually low-interest, loan can get you quick cash to pay off debts. Be sure to check on the tax implications of borrowing, and understand that if you don't repay the loan it will be subtracted from the amount your beneficiary receives.
3. Understand the difference between a consolidation loan, a debt management program, and debt negotiation. Companies that claim to be able to help you lower your payments or get out of debt quickly may appear to be offering consolidation loans--they may even have the word "consolidation" in their names--when in fact they use methods such as debt management, settlement, or even bankruptcy. There are major differences between these options.
   
   
   • A consolidation loan is simply a loan that pays off your other loans. Once you consolidate a loan, you owe that money to the new lender, not to the original creditor. A consolidation loan may lower your monthly payments, either by reducing your interest rate or by extending the length of time for repayment, but it pays off the other creditors completely. Consolidation loans may temporarily blemish your credit, but generally to nowhere near the extent of debt management programs or debt negotiations.
   • Debt management programs may also reduce your payments, but they work differently. A debt management agency acts as a middleman between you and your creditors and tries to negotiate a reduction in the interest rates or fees on your loans. You then pay an agreed amount to the debt management or credit counseling agency, and they disburse the payment (usually minus a fee) to your creditors. Participation in a debt management plan usually shows up on your credit report, and may adversely affect your credit rating.
   • Debt negotiation is the act of settling a debt for less than what you owe. You pay a part of what you owe to a creditor, and the creditor writes off the rest of the debt. Credit card companies often offer lump-sum settlements as a way to recoup part of their losses. While you end up owing less, a settlement will bruise your credit, badly. Worse still, third-party companies that offer debt negotiation have been known to disguise their practices as consolidation, and these companies frequently charge exorbitant fees while simply passing along payments to your original creditors, sometimes failing to even negotiate any difference in your repayment terms.
4. Aim to pay off your debt quickly. One of the most attractive features of consolidation loans is the potential for lower monthly payments. But if the reduced payment is just the result of spreading your repayment over a longer period of time, you'll most likely be paying more--sometimes far more--with the consolidation than you would have otherwise. Figure out your budget and set your monthly payment as high as you safely can. You'll end up paying less, and you'll get out of debt quicker.
5. Get the right loan for you. Debt consolidation loans can be secured (backed up by collateral) or unsecured (also often called "personal loans").
   
   
   • Secured loans, such as second mortgages, secured lines of credit, or home equity loans, will typically have lower interest rates than unsecured loans because if the borrower defaults on the loan, the lender can recoup the money by selling the underlying asset. Interest on a home equity loan may also be tax-deductible, a feature that may save you more money. Keep in mind, however, that if you fall behind on a home equity loan, the lender can foreclose on your house. Carefully consider the risk before opting for any secured loan. Also keep in mind that such loans may include hidden fees such as "points" (a point equals one percent of the amount borrowed), that may drive up the cost of your loan.
   • Unsecured loans are a safer option, because you don't have to risk your house or other assets. If you have good credit, you should be able to get a decent rate (at least compared to credit cards) on an unsecured personal loan. Depending on your situation, however, especially if you have poor credit, you may find that only a secured loan will get you a lower rate than what you're currently paying.
6. Shop around. Get quotes from several different lenders, and compare the terms and interest rates carefully. Your own bank or credit union is often your best bet, particularly for personal loans, but it's a good idea to shop around. Get quotes in writing so you can compare lenders side-by-side. There are also websites that allow you to compare several lenders. Make sure you understand all the fees associated with the loans, as well as the conditions of the loan. If you want to get a solid price for the loan, you'll need to actually apply, as the final interest and fees may vary considerably from those quoted. Get as accurate a quote as possible by providing only accurate information.
7. Compare the total cost of consolidation to your current situation and to other consolidation loans. Don't just pay attention to the monthly payment. That's how consolidation companies lure you in, but even with the lower payment you may end up paying a whole lot more under the consolidation. Instead, consider how much you'll pay for a consolidation loan, including the interest, upfront and recurring fees, closing costs and points (for secured loans), and any tax implications, over the life of each loan. Choose the best option and then compare it to the total amount you'll have to pay to pay off your current loans (if you were to not consolidate). If you can realize substantial savings on the total cost of the loan, consolidation is probably a good option.
8. Read your loan contract carefully. Read every word, and then read every word again. Ask any questions you may have, and make sure you understand the answers, no matter how many times you have to ask. If in doubt, get a lawyer or another knowledgeable, independent source to take a look at the documents for you. Something that seems inconsequential in a contract can end up costing your thousands of dollars or even your home, so do your due diligence.
9. Reject credit insurance. Some lenders will attempt to pressure you into buying credit insurance, either by extolling its virtues, implying that your application will be rejected, or hiding it from you. If a lender does either of the latter two, get out of there and file a complaint with the appropriate authorities (in the U.S., the Federal Trade Commission (FTC) handles complaints, as do many state attorneys general). Credit insurance can add a huge cost to the loan, and it generally offers you very little protection. The lender may make the cost seem small by telling you the monthly price, but don't be fooled.
10. Finalize the loan. If your loan hasn't already been approved, complete the full application process. This should be straightforward, but it can take some time and footwork. If your loan rate is different from that which you were quoted, find out why, and then check with your next best option. Don't get taken by the old bait-and-switch.
11. Control your spending. If you're looking to consolidate because you've gotten in debt over your head, there's no time like the present to take a good look at your budget and balance it so that you don't continue to dig yourself in.