Forex Trading Education

Online currency trading may be a new concept to some, but, there are plenty of people who find it a lucrative and worthwhile endeavor.

E-Currency trading is the practice of buying and selling foreign currencies to turn a profit, and there are many different benefits and advantages to this kind of trading. Perhaps your portfolio is largely filled with stocks, mutual funds and bonds, but not currencies, in which case expanding to include foreign currencies is a great way to have your money in different aspects of the financial market.

Understanding E-Currency

E-currency trading is done on the Global Foreign Exchange and is a 24 hour operation. The trading day begins in Sydney when their exchange opens for the day, and from there it moves around the globe as different markets throughout the world begin to open. The last major market to open is New York.

Yes, there are many different currencies throughout the world, but the majority of trading is done with what are known as “the majors”. These are the major currencies of the world that are relatively economically stable, thus making them a good choice; They include the Euro, British Pound, American, Canadian, and Australian Dollars, the Swiss Franc, and Japanese Yen.

What Does It Mean?

The MACD (Moving Average Convergence/Divergence) is a trend following momentum indicator that shows the relationship between two moving averages of prices.

The MACD is the difference between two exponential moving average.

A short exponential moving average, called the "trigger" line is plotted on top of the MACD to show buy/sell opportunities.

Putting It To Use

There are three popular ways to use the MACD:

Crossovers: The basic MACD trading rule is to sell when the MACD falls below its signal line. Similarly, a buy signal occurs when the MACD rises above its signal line.

Overview

A Descending Triangle chart pattern is a continues price formation; when combined with a Demand Index Indicator properly, over 75% of our trading positions will be profitable. By definition, the Descending Triangle chart pattern indicate a sell pressure; You can see visually that the sellers sell at lower prices as time progress (A,B and C).

Professional trader will use Demand Index indicator in several ways. I will focus on this indicator ability to predict trend strength, so, if the indicator stays near the level of zero for any length of time (see blue rectangle in chart - lower window) we can anticipate a price breakout.

Case study - NASDAQ-100 Index Tracking Stock ETF (QQQQ) Bar Chart

Indicators and Parameters:
Descending Triangle chart pattern - continues (red) - normally formed in a few week period, and consist from an upper descending resistance line (A-B-C) and support line (2).
Demand Index (red; lower window) - calculated by the change in price and volume alike.