Free Forex Guide Part 6

Technical Analysis
Just like their counterparts in the equity markets, technical analysts of the Forex trading market analyze price trends. The only real difference between technical analysis in Forex and technical analysis in equities is the time frame that is involved in that Forex markets are open 24 hours a day.
Because of this, some forms of technical analysis that factor in time have to be modified so that they can work with the 24 hour Forex market.
Some of the most common forms of technical analysis used in Forex are:
• The Elliott Waves
• Fibonacci studies
• Parabolic SAR
• Pivot points
A lot of technical analysts have a tendency to combine technical studies to make more accurate predictions on your behalf. (The most common
method for them is combining the Fibonacci studies with Elliott Waves.) Others prefer to create trading systems in an effort to repeatedly locate
similar buying and selling conditions.

Choosing Your Strategy

Most successful traders will develop a strategy and perfect it over a specific period of time. Some people will focus on one particular study
or calculation, while still some others use broad spectrum analysis as a means of determining their trades. Most experts would likely suggest
that you try using a combination of both fundamental and technical analysis, with which you can make long-term projections and also determine
entry and exit points. Of course, in the end, it is the individual trader who has to decide what works best for him.
When you are ready to get started in the Forex market, you should open a demo account and paper trade so that you can practice until you can
make a consistent profit.  Many people who fail have a tendency to jump into the Forex market and quickly lose a lot of money because of a
lack of experience. It is important to take your time and learn to trade properly before you start committing capital.
You also need to be ale to trade without emotion. You can’t keep track of all stop-loss points if you don't have the ability to execute them
on time. You must always set your stop-loss and take-profit points to execute automatically, and don't change them unless you absolutely have to.
Make your decisions and stick to them.  Otherwise you will drive yourself and your brokers crazy.
You should also realize that you need to follow the trends.  If you go against the trend, you are just messing with your money because
the Forex market tends to trend more often than anything else and you will have a higher chance of success in trading with the
trend.
The Forex market is the largest market in the world, and every day people are becoming increasingly interested in it. But before you begin
trading, make sure your broker meets certain criteria, and take the time to find a trading strategy that works for you.

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