Day trading has always been one of the most well-known and widely misunderstood forms of speculation, not only in the forex (foreign exchange) market but also in stocks and futures. Skill and experience is especially important to forex day traders since the market movers (the "smart money") are notorious for manipulating short-term price action to deliberately slaughter the fresh prey.
Unfortunately, beginners to online forex trading seem to have a tendency to believe that day trading is somehow easier, safer, and more appropriate for those with very little experience -- and a a very little account balance to match. It isn't.
October 18, 2010
February 5, 2010
When beginner traders set out to learn the foreign exchange markets, the first type of strategy they're likely to find on web sites and books are trend following methods. Unfortunately, the market spends as much time in tight consolidating ranges as it does in smooth, identifiable trends. Knowing when to trade a profitable strategy is as important as knowing how to trade it.