SigmaForex Timing is Everything With Forex Trading

The most challenging part of getting started with Forex trading is to learn this innovative way of trading. Many potential investors that try to navigate the Forex system unaided end up being frustrated and financially intimidated. There are very simple strategies to becoming successful using the foreign exchange trading system but the first step is gathering all of the necessary information surrounding this type of trading specialty. Securing a reliable Forex trading broker is likely the first and most pivotal step after learning the initial principles.

Unlike many types of trading and futures, foreign exchange trading is not designed to make the client rich quickly. Many people are frightened off by the word that Forex trading is a get rich quick scheme that in large part, doesn't work. This is a financial myth despite all the hype surrounding the foreign exchange trading system. There are steps and gains to be taken in order to secure a future in successful trading. Expect to dedicate a large portion of time to researching and understanding the market in general before setting out with your pocket book ready to invest. Learn all you can about the Forex market in the beginning in order to make the Forex trading path a smooth and triumphant one.

There is no doubt that there are numerous types of orders that can be utilized in order to open and close trades and becoming familiar with them is a must. In the foreign exchange trading business there are charts, graphs and other visuals to help you effectively analyze trends in currency trading. These charts and graphs will assist in making well-informed decisions on what currency to sell. Timing is everything and it goes without saying that when experiencing with the Forex trading system, knowing when to trade can be the pivotal difference between success and failure. Understanding the analysis tools and how to use them efficiently will put any investor on the right track.

As well as proficient trading tools, it is an absolute necessity when using the foreign exchange trading system to understand how to use the software to perform actual trades. The only way to become comfortable with using Forex trading software is to use it and learn how to plot a course through the process. Selecting a good trader is the most imperative tip at this stage because an established trader can help you with the services required as well as giving you in depth tutorials using the foreign exchange trading system.

The most critical tool that will be utilized in the Forex trading system is patience and discipline. As mentioned earlier, foreign exchange trading is not a get rich quick proposal so learning patience and discipline can help you to become profitable in a timely fashion without losing money.

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Why Hedge Foreign Currency Risk - SigmaForex

International commerce has rapidly increased as the internet has provided a new and more transparent marketplace for individuals and entities alike to conduct international business and trading activities. Significant changes in the international economic and political landscape have led to uncertainty regarding the direction of foreign exchange rates. This uncertainty leads to volatility and the need for an effective vehicle to hedge foreign exchange rate risk and/or interest rate changes while, at the same time, effectively ensuring a future financial position.

Each entity and/or individual that has exposure to foreign exchange rate risk will have specific foreign exchange hedging needs and this website can not possibly cover every existing foreign exchange hedging situation. Therefore, we will cover the more common reasons that a foreign exchange hedge is placed and show you how to properly hedge foreign exchange rate risk.

Foreign Exchange Rate Risk Exposure - Foreign exchange rate risk exposure is common to virtually all who conduct international business and/or trading. Buying and/or selling of goods or services denominated in foreign currencies can immediately expose you to foreign exchange rate risk. If a firm price is quoted ahead of time for a contract using a foreign exchange rate that is deemed appropriate at the time the quote is given, the foreign exchange rate quote may not necessarily be appropriate at the time of the actual agreement or performance of the contract. Placing a foreign exchange hedge can help to manage this foreign exchange rate risk.

Interest Rate Risk Exposure - Interest rate exposure refers to the interest rate differential between the two countries' currencies in a foreign exchange contract. The interest rate differential is also roughly equal to the "carry" cost paid to hedge a forward or futures contract. As a side note, arbitragers are investors that take advantage when interest rate differentials between the foreign exchange spot rate and either the forward or futures contract are either to high or too low. In simplest terms, an arbitrager may sell when the carry cost he or she can collect is at a premium to the actual carry cost of the contract sold. Conversely, an arbitrager may buy when the carry cost he or she may pay is less than the actual carry cost of the contract bought. Either way, the arbitrager is looking to profit from a small price discrepancy due to interest rate differentials.

Foreign Investment / Stock Exposure - Foreign investing is considered by many investors as a way to either diversify an investment portfolio or seek a larger return on investment(s) in an economy believed to be growing at a faster pace than investment(s) in the respective domestic economy.

Hedging Speculative Positions - Foreign currency traders utilize foreign exchange hedging to protect open positions against adverse moves in foreign exchange rates, and placing a foreign exchange hedge can help to manage foreign exchange rate risk. Speculative positions can be hedged via a number of foreign exchange hedging vehicles that can be used either alone or in combination to create entirely new foreign exchange hedging strategies.

Sigma Forex is leading European professional online trading Brokers registered in the Switzerland and most of the EU countries. It was founded by professional private investors including (banks, traders, brokers, and software developers), which enabled Sigma to identify the essential needs of the Forex participants from the start.

Since 2003, Sigma’s aim has been to provide the best, powerful and most suitable currency trading technology along with superiority in execution, competitive services, and dependable customer service. Over the past years, Sigma has quickly become one of the world’s leading online retail currency trading institutions, providing integrated global trading systems, analysis techniques and the most reliable and sophisticated online trading software. We offer internet trading through Meta Trader. This trading platform is very stable and reliable. It is highly regarded and very popular among traders.

SigmaForex | Forex Resources

The live forex charts can be used to track ten currency pairs in real time and click on forex rates for a pop-up window of ten currency pairs with live rates for the EUR/USD, USD/JPY, GBP/USD, USD/CHF, USD/CAD, AUD/USD, NZD/USD, EUR/JPY, EUR/GBP and EUR/CHF, including the daily highs and lows from 17:00 EST.

For a selection of free ebooks, trial offers, calculators and tutorials, visit free downloads. For a current snapshot of the foreign exchange market, use the market monitor to display time zones for several key markets, as well as live forex rates, a sentiment indicator and an economic calendar in a detachable window.

Use the online money management calculator to calculate the correct position size for your trade based on your risk profile. Browse the selection of forex books on offer in forex books which includes special sections on technical analysis and general trading. There is a great number of forex related resources to be found in the categorised forex directory to help you find a particular niche or service.

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SigmaForex.com is pleased to have you as a loyal client, and we would like to thank you for your continued support and interest in our trading programs.

As appreciation and gratitude we are offering you a chance to join our bonus program and have up to 5% bonus credit on your deposit.
All current and new clients are eligible to participate in this program. Qualifying clients earn up to 5% bonus credit on all new deposits received and credited to the account before the close of business day 31 December 2008.

The bonus credit to the account is effective when the new deposit is credited and is subject to the client opening at least 100 lots and closing the trades on or before the close of business day 31 December 2008.

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SigmaForex.com, in its sole discretion, will determine if a client's deposit and trading activity entitles it to retain the bonus credit.

Learn Forex Trading In An Innovative And Easy Way with SigmaForex

Why Learn Forex trading?The forex market is by far the largest market in the world. It is estimated that around $1.5 TRILLION is traded every single day. By far more then all the stock, bond and futures markets of the entire world combined! Forex or currency exchange is the term used to describe the trading of world currencies. A trade occurs when a trader simultaneously buy of one currency and sell of another one. E.g., to buy British pounds with US dollars.

The currency combination used in a trade is called a pair.What does a forex trader do? Simple, buy a currency at a low value and sell it at a higher value, and in the process profit from it! For example, buy Great British Pounds with US Dollars, wait for the Pound rate to go up and make money! This can be done several times a day if the forex trader is a day trader or several times a week or month if the trader is a forex swing trader.What are the main benefits of trading in the forex market?Many currency pairs are very volatile. Volatility means that they move a lot during the day, from side to side, allowing traders to capture sometimes 5-6 price swings per day, each one potentially allowing the trader to make impressive profits.5-7 currency pairs to monitor (instead of over 10,000 stocks!), no commission trading, guaranteed fills for stop losses and limit orders, impressive leverage. The forex market is a 24 hour market.

Never stops. This means that as a forex trader you can chose exactly when to trade. Some traders have day jobs and do not have the necessary time to trade during the day so they can trade at night. People who make their living as forex traders can chose to trade any time of the day or night. The point being, a 24 hour market allows the trader a lot of flexibility.What are the Exclusive benefits offered by forex trading?An incredible benefit of the forex industry is that today all forex brokers allow traders to open free demo accounts. This demo account has the full capabilities of a "real" account including live market rates, access to real-time market analysis, and the ability to execute trades off streaming prices.

This means that the trader can test his or her strategies without risking a single dollar! No other business opportunity allows you to see if it works before you spend money!Making a living as a forex trader allows you to be truly free! No office, no workers, no inventory, no marketing worries, no advertising, no selling. Learning the right forex trading system allows the forex trader to trade by just following simple rules. If A happens and B happens then do C. This is called mechanical trading. It requires absolutely no discretion, interpretation or thinking from the trader.In conclusion, Learning forex trading provides all level of investors with a lot of opportunities that many markets and industries do not provide. The reason many people have not heard of this opportunity until recently is that until not long ago trading currencies was reserved to the big dogs (banks, institutions, companies etc). Today with the help of the internet anyone can take advantage of on-line currency trading that was once reserved to an exclusive group.

Partnership Services

Sigma helps a various groups of partners around the world to enlarge their business and expand the full
potential of the Forex market.

Sigma’s services include:

• Introducing Brokers: Join our IB network and receive compensation for directing new clients to Sigma.
• Money Managers: Full service trading capabilities, plus dedicated account management, client fund
  administration and reporting.
• White Labels: White Label Program helps fitted firms set up an online presence in the Forex industry
  quickly and cost effectively.

A dedicated Partner Services team supports Sigma partners with a full range of account management services.
- Daily P&L, credits, commission allocation, etc.
- Account funding, transfers, allocations, etc.
- Customer on-boarding.

Understand This Equation for Success and Win in SigmaForex

Most forex traders lose and the reason they do, is they don't understand the simple equation for forex trading success enclosed in this article.

So learn it as part of your forex trading education and get on the road to currency trading success. Here is the equation and we will discuss its significance in a moment. Robust Logical System + Confidence in = Discipline to Apply = Forex Trading Success Now that's nice and simple - but most traders fail to understand it's significance.

Of course, some traders simply get the wrong forex education, try and apply it and lose - here are some common beliefs of losing traders: - Believing forex day trading or scalping works - Believing prices move to a scientific formula - Trying to predict forex prices in advance - Trusting their money to a forex robot with a simulated, paper track record Believe any of the above and you will lose at forex trading. To win you must understand that having a logical robust forex trading system is not enough, you have to apply it with discipline.

This means you must have confidence in the logic, because you are going to have to apply it with discipline and remember - if you can't apply your forex trading system with discipline, you don't have a system! Most traders hear about the word discipline but have no idea what it means and how important it is and it's a hard trait to acquire. You need to hold your discipline when your trading system is taking loss and after loss (this happens to even the best traders) and keep executing you're trading system with discipline. In a famous experiment, David Carter taught a group of traders who had never traded before to trade and he did it in 14 days.

The trading system taught was basically simple (a long term breakout system) but Carter didn't just tell them to follow it blindly - he taught them to have confidence in the logic, so they would have the discipline to apply it. The result was stunning - these traders made over $100 million dollars in just 4 years and went down as trading legends.

When Carter taught the group, he knew the importance of mindset and sticking with a plan through short term losing periods, to make long term profits and you must to. Discipline is not easy, but if you get the right forex trading education and have the right mindset, you can enjoy forex trading success and you will be doing what over 90% of traders fail to do. The rewards in forex trading are huge and you can generate a great second or life changing income, you must however be prepared to take your losses to get your profits. All successful traders know this and you must to.

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PIP VALUES | SIGMAFOREX

Pip Values

In most cases, a pip is equal to .01% of the quote currency, thus, 10,000 pips = 1 unit of currency. In USD, 100 pips = 1 penny, and 10,000 pips = $1. A well known exception is for the Japanese yen (JPY) in which a pip is worth 1% of the yen, because the yen has little value compared to other currencies. Since there are about 120 yen to 1 USD, a pip in USD is close in value to a pip in JPY. (See Currency Quotes; Pips; Bid/Ask Quotes; Cross Currency Quotes for an introduction.) Because the quote currency of a currency pair is the quoted price (hence, the name), the value of the pip is in the quote currency. So, for instance, for EUR/USD, the pip is equal to 0.0001 USD, but for USD/EUR, the pip is equal to 0.0001 Euro. If the conversion rate for Euros to dollars is 1.35, then a Euro pip = 0.000135 dollars.

Converting Profits and Losses in Pips to USD

To calculate your profits and losses in pips to your native currency, you must convert the pip value to your native currency. The following calculations will be shown using USD as an example. When you close a trade, the profit or loss is initially expressed in the pip value of the quoted currency. To determine the total profit or loss, you must multiply the pip difference between the open price and closing price by the number of units of currency traded. This yields the total pip difference between the opening and closing transaction. If the pip value is USD, then the profit or loss is expressed in USD, but if USD is the base currency, then the pip value must be converted to USD, which can be found by dividing the total pip profit or loss by the conversion rate.

Example—Converting Pip Values to USD.

You buy 10,000 Canadian dollars with USD, with conversion rate USD/CAD = 1.100. Subsequently, you sell your Canadian dollars for 1.1200, yielding a profit of 200 pips in Canadian dollars. Because USD is the base currency, you can get the value in USD by dividing the value by the exit price of 1.12. 10,000 CAD x 200 pips = 2,000,000 pips total. Since 2,000,000 pips = 200 Canadian dollars, your profit in USD is 200/1.12 = 178.57 USD.
For a cross pair not involving USD, the pip value must be converted by the rate that was applicable at the time of the closing transaction. To find that rate, you would look at the quote for the USD/pip currency pair, then multiply the pip value by this rate, or if you only have the quote for the pip currency/USD, then you divide by the rate.

Example—Calculating Profits for a Cross Currency Pair

You buy 100,000 units of EUR/JPY = 164.09 and sell when EUR/JPY = 164.10, and USD/JPY = 121.35. Profit in JPY pips = 164.10 – 164.09 = .01 yen = 1 pip (Remember the yen exception: 1 JPY pip = .01 yen.) Total Profit in JPY pips = 1 x 100,000 = 100,000 pips.Total Profit in Yen = 100,000 pips/100 = 1,000 Yen Because you only have the quote for USD/JPY = 121.35, to get profit in USD, you divide by the quote currency’s conversion rate:
Total Profit in USD = 1,000/121.35 = 8.24 USD.

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Hedging | SigmaForex

What Is Hedging ?

Basically, hedging involves the buying (or selling) of currency pair(s) in order to protect the hedger against unwanted currency fluctuations. Traditionally, hedging was used to protect the profits of multinational companies from unfavourable currency fluctuations.Hedging is a great way for these companies to protect their profits, but unfortunately many inexperienced Forex traders have incorrectly applied the same principles to their trading activities.Here’s how a Forex trader may try to hedge his position:Imagine that I buy the EUR/USD currency pair, and the market immediately moves against my position (i.e. prices went down). At this moment, I would be facing an unrealized loss. In order to ‘protect’ myself against further losses, I might sell the EUR/JPY currency pair in the hopes that any gain in the latter pair will partially offset the losses of the former pair.Essentially, I’ll be holding on to two simultaneous ‘long’ and ‘short’ positions for the Euro currency. Hedgers hope that the results of both positions will partially cancel each other out.

Why Hedging is A Bad Idea for Retail Traders ?

This method of hedging is a deathtrap waiting to spring. The original purpose of a hedge was to reduce the uncertainty of company profits.To the retail trader, however, this does the exact opposite!Such a hedging strategy simply leaves too many factors open to risk. Although the Euro price fluctuations may be some what muted, the ‘retail hedger’ now has worry about the USD and JPY currencies too! The EUR/USD and EUR/JPY pairs are not highly correlated and may end up causing an even larger total loss in the end.Many people like to hedge because they don’t want to admit that they made a bad trading decision. They try to ‘safely’ hold on to a losing position for as long as possible in this manner, but don’t realize that they’re actually exposing themselves to even greater risks!

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SHI Channel indicator | Sigma forex

How does the SHI Channel indicator work?

The SHI Channel indicator and as the all of the channel indicator uses the highest high and lowest low of the price to determine the upper and lower bands of the channel.In the SHI Channel The channel is calculated according to the given period of calculation and the time frame of the used chart, and the channel is self-adjusted (Like the Bollinger Bands).As you see in figure 1 there are two thick lines that indicates the upper and lower channel and a dashed center line.


The channel gives the overall direction of the price movement - up or down - and may change from time to time, specially if it used with a low timeframe (1, 5 and 5 minutes).

How to trade using the SHI Channel indicator?

Actually you can’t trade with the SHI Channel indicator alone, it will not tell you when to enter the trade neither when to exit, The SHI Channel indicator telling you the overall direction of the price trend and the channels with the middle line warn you how much the trend is strong or weak, however , you have to use another indicators to generate the entry/exit signals

So.. for entry and exit.. i will use chart pattern.. you don't have to be an expert in chart pattern.. to make hundred bucks a month in fx.. i only focus on double top or bottom pattern, head n shoulder pattern, inverse Head n Shoulder, Ascending and descending triangle (the breakout of these triangle at 4h can give you about 400 pips)

SigmaForex Technical Analysis

Technical Analysis is probably the most common and successful means of making trading decisions and analyzing forex and commodities markets.

Technical analysis differs from fundamental analysis in that technical analysis is applied only to the price action of the market, ignoring fundamental factors. As fundamental data can often provide only a long-term or "delayed" forecast of exchange rate movements, technical analysis has become the primary tool with which to successfully trade shorter-term price movements, and to set stop loss and profit targets.

Technical analysis consists primarily of a variety of technical studies, each of which can be interpreted to generate buy and sell signals or to predict market direction. Please see our Technical Studies page for a detailed description of these studies and their uses.

Support and Resistance Levels

One use of technical analysis, apart from technical studies, is in deriving "support" and "resistance" levels. The concept here is that the market will tend to trade above its support levels and trade below its resistance levels. If a support or resistance level is broken, the market is then expected to follow through in that direction. These levels are determined by analyzing the chart and assessing where the market has encountered unbroken support or resistance in the past.

For example, in chart below EURUSD has established a resistance level at approximately .9015. In other words, EURUSD has risen up to .9015 repeatedly, but has been unable to move above that point:

The trading strategy would then be to sell EURUSD the next time it gets close to .9015, with a stop placed just above .9015, say at .9025. This would have indeed been a good trade as EURUSD proceeded to fall sharply, without breaking the .9015 resistance. Hence a substantial upside can be achieved while only risking 10 or 15 pips (.0010 or .0015 in EURUSD).

On GCI's integrated charting system (GCI Multi-Currency Charts), the red support line shown above can be drawn by clicking on the "Trend" button at the top of the chart window, and then drawing a line by clicking the mouse once at the beginning of the line, and again at the end of the line.

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Salient Features of Forex Trading

There are certain features that make forex trading extremely appealing to individual traders as well as to other financial institutions and banks. These are:

• The market is open for 24 hours and for 5½ days in a week.
• It offers highest liquidity with ease of transaction with almost all major currencies of the world.
• Widespread volatile presenting huge profit opportunities.
• Can potentially cover risk exposures with various standalone instruments.
• You earn profit from rates going up as well as down.
• Good leverage with low margin requirements present high profit potential.
• Various options available for zero-commission trading.

How Price is Quoted

In forex trading , currency prices are always quoted in pairs. For example, on a particular date, the rate of EUR/USD is 1.0856 and if you buy 1000 Euros on that particular date, you will have to pay 1085.60 U.S. dollars. But, at a later date if this rate becomes 1.2082, which implies that the value of euro increased in relation to the USD, you can sell 1000 Euros and will receive 1208.20 dollars.

Therefore, you make a net profit of $122.60. So, as an investor, your aim should be to buy currencies at low price and sell those in future in higher prices. If you buy or sell a currency but do not sell or buy back the equivalent amount, it would be referred as open trade or open position.

Major Currencies Traded in Forex

In Forex trading, most of the currencies are traded against USD. The other prominent currencies are Euro or EUR, the Japanese yen or JPY, the British pound sterling or GBP, and Swiss franc or CHF. These five currencies are known as the Majors. The pairs are quoted like USD/EUR or CHF/JPY, where the first one is referred to as the base and the second as the counter or quote currency. The value of the base currency is always 1. All trading is done with currency pairs.

Pips and Spreads

Prices in Forex are quoted to the fourth decimal point (leaving JPY, which is quoted till second decimal point) and in pips or percentage in point. It is the smallest price increment and one pip is equal to 0.0001. When the bid for EUR/USD is 1.0856 and offered rate is 1.0859, it has a spread of 3 pips. Spread, in simple terms, is the difference between the bid and the ask price. The forex market is mainly operated by the brokers who do not charge a commission for their services. And, it is the spread with which they make their profit. For investors, therefore, the lower the spreads the more saving is made.

Margin

Margin is the minimum security that ensures that the investor can pay back the amount in case of losses. It is a deposit that covers any future currency trading losses. With margin, you can hold larger positions than you have in your account.

Leverage

The concept of leverage is also quite common in forex trading, which is the ratio of total available capital to actual capital. If, for example, the leverage is said to be 200:1, it means the Forex broker will lend you $200 for every $1 of your actual capital investment. Though leverage is very important for your trading, higher leverage exposes your investment to higher risks.

Common Methods of Forex Trading

There are three methods for common investors to trade in forex market. They are through the spot market, the forwards and futures market, and the options.

• Spot is the simple currency exchange processes. Here, the settlement date is the second business day after the day the deal or trade is struck.
• Forward transaction is the process where the deal is for more than two days. Future is a type of forward contract, which has fixed currency amounts as well as fixed maturity dates. These are traded in future exchanges and not through general foreign exchange market.
• Options is the process in which fixed currency transactions are carried out with mentioning some specific future date.

Risk Factors in Forex Trading

Although forex trading is extremely lucrative, it has several risk factors involved. Those are risks involving currency exchange rate, interest rate, and risks with credit and country. The average lifespan of a typical trade varies from 2 to 7 days. There are technical and fundamental indicators, which are to be consulted to decide the entry, exit, and other decisions, like order placement etc. You should have solid risk management features and disciplined trading strategies to earn profit in forex trading without risking your investment.

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