Hi – My name is Alberto, and I wanted to personally thank you

for investing in this book. Yeah, I know it kinda looks short for
a book, but there’s a reason for that.

You see, a little over 12 years ago, I placed my first trade while
I was in college (bought 200 EUR equivalent worth of Tiscali
shares, an Italian telecoms operator at the time). And this little
‘hobby’ became my obsession.

In the last 7 years as trader for the big banks (more on this later) I’ve generated over
$38 million dollars in profits trading Forex, shares, commodities, indices, you name it
– even orange juice and pork belly. That’s when I tested out all sorts of weird trading
strategies, and this book is where I share the top 50 Red Hot Forex Trading Secrets
that helped me generate such large profits.
My goal is to ALWAYS give you ONLY what you need to know in the most succinct
format, so you can spend the rest of the time trading and getting ‘on the job’ (or ‘on
the market’) experience.

Here is a quick video talking about why I do what I do:

https://www.youtube.com/watch?v=wtSzZMk_FA0

My Story…

So, I told you before that I am a trading junkie.

Yes… I COLLECT and test trading systems, ebooks and courses (I have been collecting
them since I was 16 years old)

In fact, back in 1996 I was so young (aka underage) that I had to convince my mom to
open an account in her name so I could trade on it!
Yes… When I browse the internet, I’m usually (read ALWAYS) on trading websites and
I will download, save and test any ebook, indicator or trading system I come across
(because that is the REAL entertainment for me…) and my girlfriend knows that if she
closes any of the dozens of tabs open in my browser, she’ll hear me crying out a few
choice Italian swear words because THAT IS WHAT I DO.

Yes, I loved trading… but I didn’t how how to.

I was determined to figure how to make this ‘trading’ thing work. I knew there was a
huge amount of money to be made.

If I could just figure out how…

By the time I finished high school at the age of 17, I had

been reading avidly for about a year the “Stocks and
Shares” on the last few pages of the Italian equivalent of
the Financial Times, “Il Sole 24 Ore”… In this last section
was where the stock and currency prices were listed in tiny font across a dozen or so
very narrow columns.

I was hooked.

So I bought books, and trading courses, and began to trade.

It wasn’t pretty. I made every mistake in the book(s).

Every trading system, method, strategy failed.

Most of the systems and information I bought were either outdated or were never any
good to start with.

Some were so complicated you’d need a PhD in maths and econometrics to trade.
Some others were profitable only on demo accounts but never in the real world.

Some were just Expert Advisors (or ‘robots) that took ridiculous amounts of risk for
very little profit.
Or some ‘trading gurus’ would offer a guarantee and support, but they’d never answer
my questions and stall until the guarantee ran out.

Others could just be found free online.

Some did make money, for a little while But the instant the market did anything
unpredictable the system would make horrible trades and send my account crashing.

So, I decided to become a very different type of 'trader'…

The Pin-Striped, ‘Polished’ Investment Banker (or not)

I was in my penultimate year in university when representatives

from Citigroup came to my University to recruit graduates.

I applied for and got accepted into a highly coveted corporate

finance investment bank internship with the Citigroup “Mergers
& Acquisitions” team in the new financial district of London,
Canary Wharf. I absolutely loved the analytical work of valuing companies, but didn’t
like (and couldn’t stand) the BS team politics that went on even at my very junior level.

I am very, very radical about getting results FAST based on MASSIVE ACTION and
SKILLS – I wasn’t prepared to kiss my bosses’ (or anyone else’s) rear end.

The Trader…

So, I found out corporate finance wasn’t for me and the following
year applied (and got) a position as a junior trader for Deutsche
Bank in the City of London.

Trading desk promotions are bonuses were mostly based on ‘hard

PnL’ – the amount of money the trader had made for the bank last
year rather than politics and other ‘soft people skills’ like the
people in ‘Human Resources’ liked to call them.

Being very introvert, I certainly wouldn’t have ranked very high on ‘team
communication’ and ‘demonstrating team spirit’ and other BS attributes.
I wasn’t going to be the one pulling the weight for the lazy and the time wasters in
my team and I didn’t expect anyone else to do the same for me either.

After the first couple of years with Deustche Bank and after a long sabbatical year, I
moved to Barclays Capital back in Canary Wharf in London…
 Over those 7 years Deutsche were the #1 trading house in Europe
and Barclays #3. Over those years personal Profit and Loss was
‘only’ a few million dollars per year, which went to contribute to a
total combined team PnL of about 1 Billion per year.

As a result of rubbing my shoulders with some of the most talented

traders in the industry, the team and I were kicking ass on ‘the
Street’ as we used to call it…

Mine and my fellow trader salaries were huge and we regularly collected yearly
bonuses well into the 6 figures…

Yet I was miserable.

The banks chained me to a desk. I was stuck in the office all day (and most nights).

You see…I couldn’t just make a few thousand bucks and go home.

I had to make the most amount of money possible. No matter what it took.
And that meant I had to be glued to my trading screens for at least 12 hours a day.

I was at the mercy of the markets.

In fact, this one time, after a late night at the office, I had to wake up at 4 A.M. the
next morning and rush back into the office…

All of this to place a massive trade with a Japanese client and make $1.5 Million Dollars
in just a few minutes!

I was making money but I was not a happy man.

My friends with normal jobs were having more fun than I was.

So, I quit.

I wasn’t just ‘burned out’…I was pissed off.

It wasn’t fair to myself or to the everyday person whose pension funds I was managing.
The Business…

After years perfecting the insider strategies that the big banks used to (literally) make
billions of dollars every year, I felt I had to share these with the ‘everyday man’ like
you and I.

The ‘insiders’ were making billions every year off people’s pensions and savings away
from their owner’s unsuspecting eyes, often using hidden shell companies in secret
locations. The billions made were the same billions lost by well-meaning and innocent
traders who didn’t have access to the same information and systems they big boys
did.

The cycle had to stop for the everyday trader to have a chance at success. It was time
for me to come clear and reveal what the big boys were really doing.

I started blogging and writing ebooks about what I was doing. Soon after, I launched
my first blog (MyForexTradingSuccess.com) to the public to reveal the trading secrets
the big institutions use every day to make millions…
The response was overwhelming. In less than 12 months, over 50,000 traders
worldwide were benefiting from these insights.

The ‘Family’ Business…

A year into my blogging venture, I met my beautiful girlfriend Claire, and have had
the blessing of her helping me spread the message to ‘average Joe’ trading
community.

Trading transformed our lives forever so you’ll probably

see WHY I’m so passionate about other people like YOU
building their own trading business…

My girlfriend and I are now lucky enough to be able to

live and work from anywhere in the world. After a 5-year
stint in sunny Cyprus we moved back to London for a few
months before deciding where to go next.
In the last 36 months, we visited 30 different countries…some of the places included
Singapore, the Blue Hole in Belize, Guatemala and France.

I swore to myself I would be free forever from having to wear a suit ever again

Your Story…

So, now you know who I am…

I guess the next question is who are you?

Why are you here?

Are you here to learn how to trade profitably?

Do you already have trading experience, but you want to learn how to be consistently
profitable?
My Facebook close-to-heart special community & family:

https://facebook.com/groups/tomorrowintradingprivate

https://www.facebook.com/tomorrowintrading

https://www.youtube.com/c/tomorrowintrading

https://plus.google.com/u/0/+TomorrowinTrading

https://twitter.com/tomorrowintrad

https://www.linkedin.com/company/tomorrow-in-trading

https://www.pinterest.com/tomorrowintrad
Welcome to The Ultimate Bootcamp Guide To Trading Forex! I hope that you are excited to
discover the secrets that the successful traders are using every day to build portfolios that
even the most seasoned trader would be proud to own.

After finishing this course, you will be armed with the information that you need to build
your own successful portfolio. I have laid it out in a simple to understand format that is easy
to follow.

In the following chapters you will learn the difference between the traditional stock market
and the Forex Market. You will begin the process of understanding the market trends and
statistics. I say begin to understand them because it will be constantly changing and
something that you will be continuously learning and developing as you become more
experienced in the process.

You will discover why technical analysis is so important and how to use it to make the best
trading decisions that you possibly can.
This course will show you the best ways to determine your strategy and allow you to
maximize your returns by managing your risks.

I am also going to show you why 90% of traders lose their shirts, and how the other 10%
WIN… consistently. This information alone has no monetary value!

I highly recommend that you grab your favorite drink, sit back and read this book
thoroughly. Then read it again and take notes. You may even want to print it out for future
reference… it is that good and well worth the ink and paper.

Let’s get down to business!

Any questions, comments or suggestions you can reach me at:

[email protected]
Good luck.

Alberto Pau,

Million Dollar Trader & Fund Manager

The differences between the stock market and the forex market are significant. In this
chapter, I will discuss the general definitions of the two as well as the pros and cons
of each.

The definition of the stock market is simply the business of buying and selling stock
for the financial aspect. Stock refers to a supply of money that a company has raised.
Investors (or stock holders) give the company this supply of money in order to help
that company grow, therefore increasing the value of their stock and in turn making
a profit.

The stock market is one of the more traditional ways to create a profit from an
investment… even without having much knowledge about it. A person with little or
no experience can make a few bucks without much research with traditional
investments, such as stocks, bonds and blue chips.
But with thousands of companies to choose from it can be quite overwhelming… and
you never know when a company will go bankrupt or fold altogether.

There can be a lot of risk and uncertainty when going after large gains in short
amounts of time. It can be difficult to develop a system that can provide a consistent
10 to 15% profit on a yearly basis.

The stock market is country specific, and deals only in business and currencies within
that region. There are set business hours that typically follow the more traditional
business day, and is closed on Holidays and weekends.

Let’s check out the forex market…

The forex market, also known as the foreign exchange or the fx market, is the place
where currencies are traded. It is the largest, most liquid market in the world with an
average traded value of over 4 trillion per day and includes all of the currencies in the
world.

Compare that to the $25 billion per day that the New York Stock Exchange trades and
you can easily see how enormous the forex market really is. It actually equates to more
than 3 times the total amount of stocks and futures markets combined. Forex is
awesome!

What exactly is traded on the forex market you ask? The simple answer is money. It is
the simultaneous buying of one currency and the selling of another. Currencies are
traded through a broker and are always traded in pairs.
 EXAMPLE: The euro and the US dollar (
EUR/USD)
-OR-

Confused? Think of it as buying a traditional ‘share’ in a particular country. Let’s say

you buy British Pound, you are essentially buying a share in the British economy as the
price of the GBP is a direct reflection of what the market thinks about not only the
current, but future health of the British economy.
Unlike the traditional stock market, the forex market is open 24 hours a day. At any
time, somewhere around the world, a financial center is open for business and is
exchanging currencies every hour of the day and night.

It follows the sun around the world, so you can trade late at night or early in the
morning.

TIME ZONE NEW YORK GMT

Tokyo Open 07:00 PM 00:00

Tokyo Close 04:00 AM 09:00

London Open 03:00 AM 08:00

 London Close 12:00 PM 17:00

New York Open 08:00 AM 13:00

New York Open 05:00 PM 22:00

Keep in mind that these additional hours also add additional risk for us since we aren’t
able to monitor our investments 24 hours every day. There are several safety options,
such as limit that we will discuss in another chapter.
One of the critical things that you must understand in forex trading is how to correctly
determine the value of multiple currencies.

Obviously not everyone will trade in US dollars.

But with so many variables, how can you tell a good buy or sell without complete
understanding of the value of foreign currencies?

Your first step is to figure out the current exchange rate between the currencies in
question. I highly recommend using this free currency converter:

http://www.oanda.com

They are very reliable and have tons of information to help you as well. Aside from
the information that I am giving you here, I highly recommend you study the materials
available on their website.
Keep in mind that these currency converters will not be consistently accurate down to
the cent or fraction of a particular currency at all times throughout any day, but it will
give you a solid starting point.

Currency conversion is usually expressed in a ratio known as the cross rate. Normally
you will see them listed in pairs in a xxx/yyy manner, with the xxx referred to as the
‘base’ currency (or home currency).

The base currency is usually always listed as a whole number, while the converted
currency will be expressed with a decimal that is as close as possible to the base rate.

EXAMPLE: 1 US dollar = 0.61484 British

Pound
-OR-
You’ll notice that the base currency is almost always in single units (such as one dollar
instead of ten). And since the whole number (often referred to as the ‘big’ figure) of
the secondary currency almost never changes, it is usually only referred to at the
decimal point.

Also with the consolidation of most of the European market using the Euro, many
currencies such as franc or the lira have been eliminated, making trading currencies
much less complicated.

It will take a bit of time, but once you get used to the base values of each currency,
the changes will become more obvious to you, therefore making it easier and less
confusing to monitor and you’ll be making profitable trading decisions right along
with the pros.
Now you most likely won’t be standing amidst a few hundred other screaming
stockbrokers on Wall Street, but it is important that you understand some of the terms
that you would be hearing if you were. You want to be sure to understand what these
terms mean in your trading.

These are some of the most common trading terms:

• Bid/ask spread – also known as the bid/offer spread, is the quote of the price at
which the parties involved are willing to buy or sell. The bid price is the price that a
party is willing to purchase, while the ask or offer price is the price at which the
party is willing to sell the same. The difference between the two prices is considered
the spread.

If the spread cannot be closed, then no deal can be made. The agreed upon price
and all details involved in the transaction are written in a contract.
• Currency Pair – since the value of one currency is only relevant when put in terms
of another, forex traders will always deal in currency pairs.

As I mentioned before, the first currency in the pair is considered the ‘base’
currency. The second currency in the pair is the ‘counter’ currency.

• Leverage & Margin – Margin is a good faith deposit that a trader puts up as
collateral to hold a position. The amount of margin that a trader puts up determines
his leverage.
In other words, when a trader opens a position larger than the amount of funds
required to open it, the trader has put down margin to receive leverage. While margin
refers to the amount of funds a trader has put down as collateral, leverage refers to
the amount of money he controls relative to the margin.

• Pip – (Percentage in Point) refers to the very last digit of a currency price. Just for
illustrative purposes let’s take the Euro/USD at 1.2635. If the sell price was 1.2638
then we have a 3 pip increase. Should the Euro/USD sell at 1.2735 then we have a
100 pip increase.

• Limit Order – An order to buy or sell a certain quantity of a certain security at a

specified price or better, but only after a specified price has been reached. A stop
limit order is essentially a combination of a stop order and a limit order.

• Rollover/ Carry Trade – A popular trading strategy used in the forex market. It
guarantees traders at least some return on their medium and longer term positions.
In the carry trade, speculators buy high interest currencies and sell currencies with low
interest rates. These positions ensure that each trading day rollover- interest will be
posted to the traders account. It has the potential to significantly enhance a return.

Rollover is also sometimes referred to reinvesting any earnings in additional stock or

currencies.

• Bear Market – Refers to a strong trend of downward movement in several areas of

the market.

• Bull Market – Refers to a strong upward trend in several areas of the market.
• Open Order – Your order remains pending until it is either executed or cancelled.

• Stop Order – Cancels any pending orders that are placed with the broker.

• Market Makers/Jobbers – Stockbrokers who hold or purchase securities at low

prices for the purpose of selling them to traders in a higher priced market so that
the trader can turn around and resell them for a profit… essentially creating a
separate market are called market makers (also known as jobbers in Britain).

• Whipsaw – A term for what happens when the market trends point toward a specific
direction, causing a buy or sell and then the opposite effect occurs.

These will happen occasionally and you realistically cannot expect to win with every
purchase. My best advice when it happens is to wait it out. The market will rebound
and you can still make a profit or at least break even, if you are patient.

Those are just some of the most commonly used terms that I wanted you to be familiar
with. It should help you to understand a bit about the market lingo before we get into
the meat of the course, where you will learn the details of many of the terms above.
The forex market is by far the biggest and most popular financial market in the world.
It is traded globally by individuals as well as banks and large organizations.

The chart below shows the global foreign exchange activity, with the United States
dollar (USD) being the most traded currency, with the Euro share at 2nd and the
Japanese yen at 3rd.
The forex market is an over the counter market, which simply means that there is no
central exchange or clearing house where orders are matched and transactions occur.

Large commercial banks trade with each other through what’s known as the Electronic
Brokerage System (EBS). Such banks will only make their quotes available to other
banks with which they trade. This market is not accessible to individual or retail
traders.

Then there is the online market makers. This is where individual traders can access the
forex market through online market makers that primarily trade out of the US and the
UK.

Until the late 1990’s the forex market was really only available to the ‘BIG Players’. You
could basically only trade if you had a least $10 million to start with!
It was originally intended to be used by bankers and large institutions- not by us ‘little’
guys.

Because of the rise of the internet, online forex trading firms are now able to offer
trading account to normal folks like us.

Now all you need to trade in the forex market is a computer, a high speed internet
connection and this guide.
Here is a simple comparison table of various financial markets and some of their basic
features:

Equities Futures Forex

Over the Counter (OTC) Exchanged Traded Over the Counter (OTC)
or Exchanged Traded, through open market with access to
Market with Electronic outcry in trading price determined by the
Structure Communication pits; some contracts market maker.
Network (ECN) routing are traded by ECN
available for both. after hours.

Spreads fluctuate Spreads fluctuate Spreads fluctuates on

Spreads according to demand according to Inter-bank market,
and supply.
 demand and many online market
supply. makers have fix spread.

Orders on listed stocks Orders are executed Orders on the Inter-

are placed with a via open outcry at bank market are sent
specialist, who matches the exchange pit for directly to the counter
buyers and sellers, each future party via Reuters or EBS.
providing liquidity from contract. Orders Orders executed with
Execution his own account as well. entered online market makers
OTC orders can be sent electronically are are executed at the
to market makers who routed to the pits market maker with the
take the opposite side to be executed. market maker as the
of the trade at their counter party.
quoted side.
 Market, Limit, Stop, Fill Market, Limit, Stop, Market, Stop, Stop-
or Kill, All or None, Fill or Kill, All or limit, Limit
Opening Price None, Market on
Order Guaranteed, Market on Open, Market on
Types Close, Stop-limit, Close, Stop-limit,
Market if Touched, Market if Touched,
Good Until Cancelled, Good Until
Day Order Cancelled, Day
Order

Typically 9:30am to Vary by product, 24 hours during

4:00pm local time. Off- usually starts from weekdays.
Trading hours trading can occur 9:00am to 3:00pm
Hours through ECN’s but it is local time. Off-
illiquid. hours trading is
possible but illiquid.
Volume Available Available Not Available

100-200 billion USD 300-500 billion USD 3 trillion daily volume

Market daily volume in the US. daily volume in the worldwide.
Size US.

Spread and Spread and

Transacti commission/service commission/service
on Cost charge.
We’ve already defined the spread to mean the difference between the bid price and
the ask price, which constitutes the cost of the trade. In fact, all trades have spread…
stocks, futures, commodities, etc.

Be aware that many online trading firms like to promote margin forex trading as
virtually cost free – commission free, no service charge, no hidden cost, etc.

The spread IS the cost of trading AND is also the main source of revenue for the
trading firms.

The spread may seem to be a small expense, but once you add up all the costs of all
the trades, it can eat up your share of the profits pretty damn fast!

On the other hand, while you want to find the tightest spread possible, anything that
is far lower than typical is skeptical. Since the spread is the main source of revenue for
the trading firm, if the firm doesn’t earn enough from it there may be some other
hidden costs involved in the transaction.

The following are some of the different types of orders available that can help you to
protect yourself in your trading ventures. This isn’t all that are available, but just some
of the basic orders for you to make the most out of. Use them wisely!

Market Orders – a buy or sell order in which the forex firm is to execute the order at
the best available current price.

❖ GTC – (Good Until Cancelled) An order will be valid until it is cancelled, regardless
of the trading session. (Generally, the entry orders, stop loss orders and take
profit orders are all GTC orders in online forex trading).
 ❖ Entry Orders – A request from a trader to a forex firm to buy or sell a specified
amount of a particular currency pair at a specific price. The order will be filled
once the requested price is met.

❖ Stop Loss Orders – An order placed to close a position when it reaches a specified
price. It is designed to limit a trader’s loss on a given position. This is how it
works… if the position is opened with buying a currency pair, the stop loss order
would be a request to sell the position when the price fell to a specified level and
vice versa.

Traders are strongly recommended to use stop loss orders to limit their losses. It is
also important to use stop loss orders when investors may enter a situation where
they are unable to monitor their portfolios for an extended period of time.
A margin account allows customers to open positions with a higher value than the
amount of funds they have deposited in their account.

Also known as trading on a leveraged basis, most online firms offer up to 200 times
leverage on a mini contract account. The forex market offers the highest leverage
among other trading instruments with a margin requirement of 0.5% for open
positions.

The equity in excess of the margin requirement acts as a cushion for the trader. If a
trader loses on a position to the point that the cushion runs out, then a margin call
will result.

The trader must then deposit more funds before the margin call or the position will
be closed. The account will be ‘margined out’, meaning that all positions will be closed,
once the equity falls below the margin requirement.
Most trading firms offer customizable leverage; traders can choose the leverage ratio
that they feel most comfortable with. Be aware of how to guard against over trading
an account and managing overall risk – we will cover that more in chapter 6.
Fundamental analysis and technical analysis are the two major approaches to
analyzing and studying the currency market, the first focusing on the underlying
causes of the price movements… such as economic, social and political forces that
drive supply and demand.

Technical analysis focuses on the studies of the price movements themselves.

I believe that the premise of technical analysis is that all current market information
is already reflected in the price movement which is why we will focus on the latter.

In the following chapter I will explain briefly the primary tools used for technical
analysis, arming you with the knowledge of the professionals. Use this to compare
notes and ideas, suggestions and advice with your trading firm.

Let’s get to it.

Charts are the most important tool in your understanding of the total sum of what is
happening in the market. It is simply a visualized representation of the price
movements… a reflection of the psychology of the market and a visualization of the
interaction between buyers and sellers, and shows how the market values a particular
asset based on the information available.

Because of this, it is considered to be an indispensible tool in the arsenal of any trader.

There are 3 major charts: bar charts, candlestick charts and line charts.

We will get into a bit more detail with the Candlestick charts a bit later, since they are
the most commonly used charts amongst active traders.

1. Bar Charts – Bar charts provide traders with 4 key pieces of information for a
given time frame:
 • The opening price during that time frame
• The closing price
• The high price
• The low price

Bar charts can be applied to all time frames and therefore, a single bar can summarize
price activity over the past minute or the past month.
A good rule of thumb is that the longer the time frame, the more significant it is since
it will account for more data and will be a better reflection of the markets psychology.

2. Candlestick Charts – Just like the bar chart, a candlestick chart contains the
markets open, closing, low and high price points of a specific time frame. The
main difference being that the candlesticks body will show the range between
the opening price and the closing price during that particular time frame.
Candlestick charts are more popular than the bar charts or line charts since they are
more visually appealing and helps to identify more information (see intro to
candlestick for more information).

3. Line Charts – These present much less information than the previous types of
charts. They only show the closing price for a series of periods, therefore serve
best to measure the overall direction of long-term trends.
Line Charts are of limited use for most traders but will show simply and clearly the
direction of the trend which can be extremely useful.
Support levels are prices where buyers have shown or are likely to show strength.

Resistance levels are prices where sellers are likely to be strong.

Support levels are basically giving the market a ‘floor’, since this is the area in which
buyers tend to be strong. If the current price is at a strong support level, then traders
can expect buyers to step in and drive the price up – or at least keep it from moving
any lower.

Resistance levels basically perform the exact opposite, and are essentially a ‘ceiling’
to the market. If the price is at or rises to a strong resistance level, then sellers in short
term positions may enter the market while sellers in long positions may cover their
positions to take their profits.

Many times when a price breaks through a resistance level, it will trigger a large
number of stop orders and thereby greatly increases buying power. Be careful here
though since not every breakout is valid. The same dangers of false breakouts apply
to support levels as well.
A trend simply represents a general direction of a market.

There is a physical law stating that an object in motion tends to continue in that
motion until some extreme force causes it to change direction. Price trends are no
different. A strong price trend will continue in its current direction unless there is a
price reversal indication, that will show up in your technical analysis – or even in
fundamental analysis.

There are 3 phases of major trends that you should be aware of in your analysis;
Accumulation, public participation and distribution.

The accumulation phase is the first part of the trend which represents those who are
well informed that will buy or sell.
Meaning simply that if the well informed or more seasoned, experienced traders
recognize that a current downward trend is coming to an end, then they would buy –
and vice versa.

The public participation is essentially when the masses would recognize the same and
follow suit.

The third and final phase – the distribution phase – occurs when everyone else catches
on and public participation increases even further. It is at this point that the well
informed, seasoned investors who accumulated during the accumulation phase would
begin to sell, or vice versa.
As a general rule of thumb, the existence of a trend depends on a series of highs and
lows. 2 consecutive highs, each above the previous relative high and 2 relative lows
above the previous low would constitute a tentative uptrend. A 3rd relative high
would confirm that trend.

It is very important to keep in mind that markets do not always move in trends!

They also spend a lot of time in ‘ranges’ fluctuating between already established highs
and lows. A range bound market is often referred to as a ‘sideways’ market since it is
neither moving in an upward trend or a downward trend.

The price during a sideways market is often simply building support for a continued
move in the original direction.
Trend lines are drawn on historical price levels that show the general direction of
where the market is heading and also provides indications of support or resistance.

Drawing trend lines is a highly subjective matter, due to the fact that there are so
many variables.

How it works is this… In an uptrend a trend line should connect the relative low points
on the chart. The line connecting the lows in a longer term position will be a support
line that can provide a floor for partial retracements. The downtrend line that connects
the relative highs on the chart will similarly act as resistance to shorter moves back
higher.

It is important to be flexible when drawing trend lines and redraw trend lines
whenever necessary.
In a trending market, a price channel can often be drawn between two parallel support
and resistance levels. The key to this price channel is that the lines be drawn parallel
to each other and the value of the price channel depends on that.

Unlike trend lines, price channels should not be forced on a chart where they are not
quickly apparent.

How it works is this… once a trend line is established, draw a duplicate line parallel on
the chart. Then move it up to the relative highs above or down to the relative lows
below the trend line.

If two or more fit with the line, then you may have located a valid price channel.
Otherwise the market maybe too volatile – even in the middle of a strong trend, to
plot a price channel.
Candlestick charts contain the markets open, closing, low and highs of a specific time
frame.

On a daily chart, each candle represents a 24 hour period and contains the information
indicated above. On an hourly chart, each candle represents an hour… and so on.

But since the forex market never opens and closes, how can there be an open and
closing price? To identify this information, the chart provider will decide on a time,
say 5 PM EST, as the daily open and closing time.

Keep in mind that different chart providers may have different opening and closing
times and traders may notice that the charts may differ from different providers.
There are recurring patterns on these candlestick charts that can be observed by
technical analysis. These patterns are like recurring pictures that tend to occur when
a trend is starting or about to end, or even reverse its direction.

They provide an excellent visualization of the price movements and can give us a good
idea of what is happening in the market.

These patterns are the best gage for identifying trends in the market.

EXAMPLE: If a candlestick is very short, it implies that the range for trading that day
was very tight. If this candle appears after a strong uptrend, it may suggest that sellers
are beginning to enter the market more aggressively and thus the price may be on its
way back down.

Eventually, with a bit of practice, these candlestick patterns can be easily used to
identify potential trends in the market – especially when used in conjunction with
other indicators, allowing you to enter the market with strong references to the
patters.

Here are some key patterns to watch out for:

Doji/Double Doji…

This pattern indicates indecision in the marketplace as the price has a big range but
isn’t going anywhere.
Hammer – Hanging Men…
This is an indication of a good reversal pattern after a severe trend. It signifies a
weakening market. Pattern is considered a hammer after a downtrend and a hanging
man after an uptrend.
Evening Star…
Reversal pattern shows trend has changed direction after making new highs.
Morning Star…
Opposite of the evening star – reversal pattern shows trend has changed direction
after making new lows.
Bear Market…
Common pattern after strong uptrends. Signifies that buyers are losing control.
Bull Market
Common pattern after dramatic downtrends. Signifies that downtrend has lost
momentum.
Harami…
Harami shows a trend that is losing momentum and may reverse.
Shooting Star…
Reversal patterns that occur after gaps. Buyers may make new high but fail to sustain
them.
Piercing Line…
Bullish reversal patterns which shows sellers are losing their dominance.
Dark Cloud Cover…

Bearish pattern showing slowing buyer momentum.

Keep in mind that you will recognize these patterns as you gain more experience.
These are just some of the patterns to watch out for.
Fibonacci retracements are based on mathematical numbers that repeat themselves
and attempt to measure the likely points that a currency pair will retrace, or pull back
to within a range.

Now while I’m not about to get into the mathematical system that this uses (boring!)
I will let you know that you can use a charting software with the Fibonacci function,
or simply let your forex firm help with your charting.

Also, note that Fibonacci retracements can be used in both bull (uptrend) and bear
(downtrend) markets. You will need to look for retracement levels and use them with
your candlestick patterns to confirm your trades.
Based on different mathematical calculations, technical indicators are statistics of past
market data. Traders use them extensively in their technical analysis to predict
currency trends.

The two major technical indicators are:

Trend following indicators reflect the direction and the strength of a current trend.
Traders may enter a position when the trend following indicators are showing the
current trend in a strong momentum in either direction.

The most common trend following indicators are moving averages and Bollinger
bands.

Oscillators are indicators banded between two extreme values that reflect short term
overbought or oversold conditions. The most common oscillators are RSI (Relative
Strength Index), MACD (Moving Average Convergence Divergence) and stochastic.
Most charting packages usually include the common technical indicators or you can
find a charting package and add the indicators that you want if they aren’t included.

You will probably use a mix between the trend following indicators and the oscillators.
Use whatever you are comfortable with.
Now that you’re understanding a bit more about how the forex market works, you
need to determine your trading strategy. There really is only one method… trial and
error.

I can suggest to you to open up a Demo account (there are many available) although
I believe that it makes a huge difference when using real money. So open up a demo
account if you wish, but use it to learn the terms and such – then try it for real.
Remember, slow and steady wins the race!

The truth be told, almost any proven forex strategy does have the potential for profit.
Some have a greater potential for profit, but also carry higher risk, and vice versa.

Every strategy can be put into one of two main categories… long term or short term.
Basically self-explanatory, long or short positions are essentially that, the truth being,
that you could even incorporate both types into your strategy.

Short term forex strategies tend to carry more potential for greater profits. That being
said, they also carry greater potential for substantial risks. They also require vigilance…
you must be watching the market constantly, so that you are able to pick out the best
times to buy or sell, as well as placing specific orders.

Now on the other end of the stick, long term positions tend to be more stable, as well
as significantly less risky, thus aren’t usually as quick to produce substantial profits.
But you are able to ride out any small fluctuations and wait to buy or sell until the
time is right.

Furthermore, long positions are more leisurely and require a lot less attentiveness. It
is a personal preference and my best advice is to try them both and see what works
best for you. You may decide to do both and that’s okay too!
Hopefully by now you understand that the forex market behaves a bit different than
other markets. Currency markets are highly speculative and volatile in nature.

Any currency can become very expensive or very cheap in a matter of days, hours or
sometimes even minutes.

The unpredictable nature of this market is one of the things that attracts traders to
the currency market.

With that being said money management is critical and makes the difference between
the winners and the losers.

Risk management is the most significant part of any trading system. Most traders
don’t understand how important it really is.
It is important to understand the concept of risk management and to understand the
difference between it and trading decisions. Risk management represents the amount
of money that you are going to put on one trade and the risk you are going to accept
for this trade.

First of all, your risk per trade should never exceed 3% per trade. It is better to adjust
your risk to 1% or 2%, but if you are confident in your trading system then you can
adjust it up to 3%.

Secondly, adjust your stop loss so that you never lost more than you are comfortable
with on a single trade.

Now you also want to make sure that you diversify your trades between several
currencies and not trade just one pair. It is also important that you diversify your
orders between currencies that have low correlation.

There are many different money management strategies. It is critical that you adopt
the strategies that work for you and use them diligently to help manage your risk.
We understand that forex markets can be volatile and difficult to predict. While
limiting the impact of any adverse price movements, using limit orders can help you
capitalize on short term price movements.

A limit order is simply a standing amount at which you have instructed you forex firm
to buy or sell a position. Setting these limits protects you and your investments.

While there are no guarantees that the use of these types of orders will limit your
losses and protect your profits in all market conditions, a disciplined use of market
orders will help you reduce the risk that you are taking. It will also give you peace of
mind in your trading.

We’ve covered many of the market orders that are available in the forex market.
However, keep in mind that not all market orders are available at all online forex
brokers.
So when you open your account with a broker or forex firm, make sure the orders that
you want to use are available.
Why do traders lose? The statistics show that 90% of all traders lose money.

It’s an age old question and while there is no magic formula and no way that anyone
can guarantee that you won’t lose money, there are 5 fundamental things that you
can do to become part of the 10% THAT ARE CONSISTENTLY PROFITABLE.

How do you do that?

1. Develop a clear and concise method.

First of all, if your goal is to become a consistently successful trader, you must
have a clear and concise method for trading.

In order to have that you must have a clear and precise way of looking at and
reading the markets. Guessing or going by gut instinct might work occasionally,
but if you don’t have a specific method, then you don’t have a way to know what
constitutes a buy or sell signal, and aren’t able to correctly identify the trend.
The way to go about this is to write it down. You need to define in writing what
your analytical tools are and how to use them. It really doesn’t matter what charts
you use as long you actually take the effort to define it.

In other words, for example:

➢ What constitutes a buy

➢ What constitutes a sell

➢ What constitutes a stop

➢ Instructions on exiting a position

➢ When to use limit orders

 Clearly define your methods and define it by writing it down, and keep it simple!
Don’t make it too complicated… if you can’t write it on the back of your hand it’s
probably too complicated.

2. You must have the discipline to follow that method.

Once you have clearly and concisely defined your methodology, you absolutely
must have the discipline to follow through with that method.

If you view a price chart different than you did 2 months ago then you either
haven’t developed your method, or you lack the discipline to follow it.

The formula for success is to consistently follow and apply a proven method.

3. Have realistic expectations

Don’t be greedy!
We’ve all seen the ads that may get our blood pumping with promises of
becoming wealthy overnight while we sleep , or investing a few bucks in stock
and making a million in a week, what usually sounds too good to be true usually
is.

Now it is possible to experience above average returns on some trades, although

it may be difficult to do without above average risk.

The goal for every trader, especially in the first year is to not lose money! Any
percent return you see above that is icing on the cake.

In other words, don’t allow yourself to get greedy! This is the downfall of many
traders. They start to feel overly confident and start taking higher risks and end
up losing mucho cash!
4. Be Patient

One of the reasons that most of us get into trading and the forex market is
because it’s exciting. I mean let’s face it, trading is a lot like gambling and any
time money is involved it tends to get our blood pumping.

As a result, you will get tempted to start taking shortcuts on your methods or
you’ll start making trades of lesser and lesser quality, seriously adding to your
levels of risk and inherently over trading!

I have found that by reminding myself that I have no reason to worry about
missing that next great opportunity, because there is another one right around
the corner… guaranteed.
5. Manage Your Risk By Managing Your Money

I could seriously write a whole book on the importance of managing your money.
There are so many factors in managing your money… such as risk/reward
analysis, probability of success and failure, and so much more.

With that in mind I am going to address the issue of money management with a
focus on risk on the entire portfolio size and not each individual transaction.
You’ll see what I mean.

I believe that many traders tend to be over aggressive in their trades. A good rule
of thumb is to never risk any higher that 1-3% of your portfolio. If you have a
small trading account, then trade small.

The bottom line to becoming a consistently successful trader is longevity! Keep

your risks small and you’ll be able to weather the rough spots. If you are risking
25% of your portfolio on each trade, then it will only take 4 consecutive losses
for you to be completely out of business.
 Remember the story of the tortoise and the hare… slow and steady win the race!

Although it is my belief that making money in the foreign exchange market is easier
than any of the other trading markets, it isn’t easily done without your eyes wide open.

I can guarantee if you practice the above 5 steps, you won’t be caught in the 90% of
losing traders.

Let’s wrap this up…

Let’s recap:

• The forex market represents the electronic over-the-counter markets where

currencies are traded worldwide 24 hours a day, five and a half days a week. The
typical means of trading forex are on the spot, futures and forwards markets.

• Currencies are “priced” in currency pairs and are quoted either directly or
indirectly.

• Currencies typically have two prices: bid (the amount that the market will buy the
quote currency for in relation to the base currency); and ask (the amount the
market will sell one unit of the base currency for in relation to the quote
currency). The bid price is always smaller than the ask price.

• Unlike conventional equity and debt markets, forex investors have access to large
amounts of leverage, which allows substantial positions to be taken without
making a large initial investment.
• The adoption and elimination of several global currency systems over time led to
the formation of the present currency exchange system, in which most countries
use some measure of floating exchange rates.

• Governments, central banks, banks and other financial institutions, hedgers, and
speculators are the main players in the forex market.

• The main economic theories found in the foreign exchange deal with parity
conditions such as those involving interest rates and inflation. Overall, a country’s
qualitative and quantitative factors are seen as large influences on its currency in
the forex market.

• Forex traders use fundamental analysis to view currencies and their countries like
companies, thereby using economic announcements to gain an idea of the
currency’s true value.
 • Forex traders use technical analysis to look at currencies the same way they
would any other asset and, therefore, use technical tools such as trends, charts
and indicators in their trading strategies.

• Unlike stock trades, forex trades have minimal commissions and related fees. But
new forex traders should take a conservative approach and use orders, such as
the take-profit or stop-loss, to minimize losses.

Just keep in mind that managing your money goes hand in hand with managing your
risks, which is the key to any kind of investing… and remember to not be greedy. Slow
and steady wins the race every time.

To Your Success,

Alberto Pau, Million Dollar Trader & Fund Manager

What comes to your mind when you mention the word investing?

Does it mean putting your money in insurance, mutual funds, the stock market or even
high-yield investments?

Other people might only think about investing when they are about to die and they
haven’t left anything for their offspring. Some even shiver when they hear the word,
often claiming that they have no money to invest or feel that is too complicated a
subject to even discuss about.

Many people even invest heavily in health supplements, personal trainers and
beauticians to make themselves live longer, healthier or even look younger.

All of these are legitimate concerns when it comes to investing...I am talking about the
most important investment a person can make in his or her lifetime.
The most important and No.1 rule is “Invest in Yourself”. If you don’t, who else will?

Your parents will only invest in your education until you leave college or university.
Those are barely teaching you the basic necessities and unfortunately do not teach you
some of the important lessons about financial education.

Would you depend on colleges or universities to teach you how to make money? Most
colleges only teach you skills so you can earn money working for other people.

How about business schools? If business lecturers were such experts at business, why
are they still lecturing instead of making a fortune in their business ventures?

Would your boss teach you how to succeed in business so that one day, you will be
taking his position?

You and only you can be in charge of your financial future.

Our education doesn’t stop at college or university

For most working adults, their education enters "retardation" stage after they leave
college or university. They stop learning and therefore they stop growing.

We know that IQ is important, right? But then why aren’t the smartest people in the
world also the richest people in the world
You must first INVEST in your Financial IQ.

Having good financial IQ is not about saving tons of money and dumping it into
mutual funds. It is developing a healthy relationship with money and building assets
and knowledge that over time will generate your money for you.

So, what does it take to develop your financial IQ?

Delayed gratification is one of the most important aspects to developing your financial
IQ. Take this as a hypothetical example.

Would you pay for a pint of milk or a cow?

If you buy milk, it is consumed and it is over. You will have to buy milk over and over
again when it is finished. Even if the milk costs less than a cow, in the long run, you will
still be buying milk again and again.
Now, if a cow were to cost 50 times more than milk, you might pay through your nose
when you purchase the cow, but after consuming 50 pints worth of milk from the cow,
you would break even on your investment and save more money in the future. In fact,
the cow might give birth to 2 or more calves and you could sell one of them for profit!

Get the idea?

EVERYONE is capable of creating wealth. When you take a beat up old car and give it
an overhaul, paint it with a new coat of paint, and change a few more parts to make it
start running again, you could sell that car for more money than if it was just a beat
up old car. You would have created wealth in the process!

How about a farm? If you turn a farm into a country home getaway resort, wouldn’t
the value of the farmland increase manifold?

It is the same principle for chefs, computer programmers and craftsmen. The sum of
the whole is greater than the parts. We are all capable of creating wealth even out of
thin air and that is the first step to getting our creative juices flowing.
The value of anything is defined by supply and demand.

You don’t need to be a Major in economics to understand this. Money is just an idea.

Bottom-line is this:

Invest in assets and education that bring long term value. Anything that brings you or
helps you generate more income is an asset. Don’t invest in liabilities like fancy cars or
boats.

Are you willing to step out of your comfort zone and take charge of your financial
future or ignore the signs of the times and expect your boss, the government or the
bank to take care of you financially for the rest of your life, living below your means
and never taking risks to better your family’s future?
HOW TO MAKE LONG TERM PROFITS WITH FUNDAMENTAL ANALYSIS IN FOREX

In any type of trading, the goal is to BUY LOW and SELL HIGH. How do you determine
the best time to buy and sell though? You can do this fundamental analysis. See how
experts using fundamental analysis to identify long term trends and profit
opportunities.

A 'DUMB' FORMULA WITH STOCHASTICS TO PROFIT FROM FOREX TRADING

Watch this video where I discuss the top 3 things you need to know about Stochastic
oscillators to identify currency support and resistance levels.

A SIMPLE FOREX MOMENTUM TRADING STRATEGY ANYONE CAN USE

Simplify your trading while multiplying your profit potential with this simple
momentum trading strategy. Learn the 7-step checklist you can follow that will
drastically increase your chances of placing profitable trades.
FOR MORE TRADING TIPS, ATTEND A FREE WORKSHOP:

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