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Introduction:
17 June, 2008
Introduction:

 

 

• Trading in the Forex market is a challenging opportunity where above-average returns are available to those educated and experienced investors who are willing to take above-average risk.

• However, before deciding to participate in Forex markets, traders should carefully consider the investment objectives and scope, the required level of experience and risk abilities that should be available, and the most important factor is to take into consideration not to invest capital, if you can not afford its loss.

• In addition to the “Market Risk” associated with adverse price movement, there is a number of other “Risk Factors” that are inherent to online trading, whether manual trading or regular automated trading concepts available in some platforms.

Purpose

• By going through all previous points, ForexGen reached to some certain findings that aim to give traders the possibility to participate in the Forex industry with potentials in actually gaining money form the market and not often losing, this can be done by introducing the concept of “Automated Trading System”.

• The goal of building this system is to replace the human involvement in trading and relieve the individual trader from the emotional, physical and psychological stresses of manual trading and the tedious monitoring responsibilities of running an expert advisor on a platform.

• The strategies embedded inside the system enables it to self-adjust to follow trending and ranging markets by using complex and sophisticated “market specific” trading algorithms and logic to analyze different price structure and movements resulting in self-adapting to the constant change in market conditions.

• The system has the capabilities to trade major currency pairs like (EUR/USD, USD/JPY, GBP/USD and USD/CHF) and any other pairs available in the Forex market .

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Types of Charts
17 June, 2008
Types of Charts





All charts are potted with time on the x-axis and the currency pair on the y-axis. Each time period on our real time charts can range from a tick by tick a weekly interval (the tick refers to each individual pip movement).
This gives traders the flexibility to view currencies with closer examination while also allowing them to spot the trends most suitable for their time-sensitive trading strategy.Here’re the most popular types of charts

Line ChartS
A line chat is simple a graph of the value of a currency taken at regular time intervals based on current prices. Below is a LINE CHART example : A line chart’s strength come from it’s simple design .

Bar Charts
Bar chart is graphic representation of price action using a vertical bar to connect the highest price to the lowest price during a period. The opening price is displayed as a horizontal line on the left side of the bar.The closing price is displayed as a horizontal line on the right side of the bar.Bar charts can be constructed for any time period in which prices are available. Traditionally, the most popular time interval for bar chart is hourly chart.
andlestick Charts
Candlestick Charts identical to a bar chart in the information conveyed, but presented in an entirely different visual context. The candlestick encapsulates the open, high, low and close of the trading period in a single candle.
Candlestick charts are much more visually appealing than a standard two-dimensional bar chart. As in a standard bar chart, there are four elements necessary to construct a candlestick chart, the OPEN, HIGH, LOW and CLOSING price for a given time period. Below are examples of candlesticks and a definition for each candlestick component: The body of the candlestick is called the real body, and represents the range between the open and closing prices.

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ForexGen platform features:
17 June, 2008

ForexGen platform features:

 

• Streamline dealing with no request for quote for up to 200 lots (20 million).

• ForexGen trading platforms have a friendly user interface that is both easy to use and to grasp.

• One click orders execution.

• Providing real-time charts with the most common indicators.

• Advanced charting tools with many technical analysis features.

• Daily account statement.

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ForexGen Trading Station :
17 June, 2008
ForexGen Trading Station :


ForexGen Trading Station is the client part of online ForexGen Trading Platform.

We provide all the needed trading tools for a successful trading.

We attempt to supply the sufficient information and tools in order to make the Forex traders’ decisions more appropriate and easier.

The program has a simple and user friendly interface that allows traders to monitor their transactions and their account as well as perform technical analysis and develop Forex trading strategies of their own.

ForexGen provides continuous real-time information and sophisticated technical analysis tools.

ForexGen Trading platforms are stable , secure and characterized by its unique performance.

It is the best solution for trading on Forex, CFD and Futures markets .

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Fundemental Analysis
17 June, 2008
Fundemental Analysis

  • It is the study of change in price through micro and macro economic levels due to political and economic conditions in countries. Analysts use fundamental analysis to predict the future trends of one nation’s currency in terms of another.
  • Fundamental analysis is usually affected by the following factors:

    • Official discount rate .
    • FOMC and Meeting .
    • Inflation.
    • Budgetary deficit .
    • Economic     indicators .
    • Trade balance .
    • Consumer price index (CPI) .
    • Producer price index (PPI) .


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Pivot Calculator
17 June, 2008



The pivot calculator is defined as a technical indicator that is produced by calculating the numerical average of a particular currency pairs high, low and closing prices.
To calculate pivot points, the pivot point itself will be considered as the primary support/resistance level.
Meaning that the largest price movement will occur at this level.
The other support ad resistance levels have less important, but still can generate significant price movements.
Pivot points can be used in two ways.
The first way is to determine the expected overall market trend.
If the pivot point level broke in an upward price movement, then the next large move in the market is expected to be bullish move, and if the pivot point level broke in a downward price movement, then the next large move in the market is expected to be bearish move.

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Forex Broker
17 June, 2008

Forex Broker



The main participants in forex market can be divided into the following types: banks, some commercial companies and some foreign currency brokers.

Choosing a Broker :
Low Spreads - The spread, calculated in “pips”, is the difference between the price at which a currency can be purchased and the price at which it can be sold at any given point in time.

Forex brokers don’t charge a commission, so this difference is how they make money
Quality Institution - Unlike equity brokers, forex brokers are usually tied to large banks or lending institutions because of the large amounts of capital required (leverage they need o provide).

Also, forex brokers should be registered with the Futures Commission Merchant (FCM) and regulated by the Commodity Futures Trading Commission (CFTC).

Extensive Tools and Research - Forex brokers offer many different trading platforms for their clients - just like brokers in other markets.
These trading platforms often feature real-time charts, technical analysis tools, real-time news and data, and even support for trading systems .

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Forex Terminology
17 June, 2008
Forex Terminology

Every trader in the Foreign Exchange ‘FOREX’ hopes to make a profit from something called ‘PIP’.
It may sound silly, but gains in pips can potentially make you over wealthy . Take your time with this information, as it is required knowledge for all Forex traders.
Don’t even think about trading until you are comfortable with pip values and calculating profit and loss.


What is a pip ?
Pips stands for ‘PERCENTAGE IN PIONTS’. In the Forex trading, a ‘PIP’ is a unit of measurement which represents the smallest change in the price of currency or a currency pair. In the stock markets this is a classified as a ‘POINT’.
As a result, some folks refer to pips as points.
Pips are the last decimal point in an exchange rate or currency pair.
For the majority of currencies a ‘PIP’ is equal to 0.0001.
This means that if you purchased USD/CHF at 1.2310 and sold at 1.2330, you made 20 pips

USD/JPY: 110.78 .01 divided by exchange rate = pip value
USD/CHF: 1.1227 .0001 divided by exchange rate = pip value
GBP/USD: 1.9799 .0001 divided by exchange rate = pip value

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Patterns Recognizer
17 June, 2008
Patterns Recognizer




Technical analysts in the Forex market found that by observing the candlesticks patterns, there are recurring patterns on the candlestick charts.

Such patterns are like recurring pictures on the candlestick charts and they tend to occur when a trend is about to end or reverse its direction.

The patterns are a very good visual representation of the price movements and it give traders a good view of what is likely to happen next in the market.

Why are candlesticks patterns important?
The answer for this question is quite simple because candlesticks represent true status of what is going on in the market at the current moment.

If a candlestick range is tight, this means that the market range for the trading day was very tight .
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Fibonacci Summary
17 June, 2008

Fibonacci Summary


There are 2 types of Fibonacci:
Fibonacci extension:the levels of Fibonacci extension will be 0, 0.382, 0.618, 1.000, 1.382, 1.618.many Traders can use the Fibonacci extension as profit taking level and when they watch the same levels ,they can buy or sell to enter the trade or cancel it,so this will become a due self-fulfilling execptation .

And the levels of Fibonacci retracement will be 0..236, 0.382, 0.500, 0.618, 0.764.a lot of traders use the Fibonacci retracement as support levels and when they watch the same levels,they can place buy and sell to enter the trade or cancel it so the support level becomes a self-fulfilling expectation .

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Simple Moving Average
17 June, 2008
Simple Moving Average

the simple moving average is formed by calculating the average price of a security over a particular number of periods.

While it is possible to create moving averages from the Open, the High and the Low data points, most moving averages are created using the closing price.

For example: a 4-day simple moving average is calculated by adding the closing prices for the last 4 days and dividing the total by 4.

11+ 12 + 13 + 14 = 50

(50 / 4) = 12.5

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Exponential Moving Average
17 June, 2008
Exponential Moving Average

Exponential Moving Average (EMA) In order to reduce the lag in simple moving averages, technicians often use exponential moving averages (also called exponentially weighted moving averages).

exponential moving average reduce the lag by applying more weight to recent prices relative to older prices.

The weighting applied to the most recent price depends on the specified period of the moving average.
The shorter the exponential moving average’s period, the more weight that will be applied to the most recent price.
For example: a 10-period exponential moving average weighs the most recent price 18.18% while a 20-period EMA weighs the most recent price 9.52%. As we will see, the calculating and exponential moving average is much harder than calculating an simple moving average.

The important thing to remember is that the exponential moving average puts more weight on recent prices. And so it will react quicker to recent price changes than a simple moving average.



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MA Summary
17 June, 2008

MA Summary

Ma summary Moving averages are one of the most famous tools and also the easisest tool used by many traders We can find many types of moving averages .

the 2 most popular types are: Simple Moving Average and Exponential Moving Average.

• The simple form of moving average (SMA) will be the simple moving average, is formed by computing the average = price of a security over a number of periods

• Exponential moving averages: EMA’s reduce the lag by applying more weight to recent prices relative to older prices.

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MACD
17 June, 2008
MACD

Moving Average Convergence Divergence (MACD)A trend indicator used to show the relation between two moving averages of prices .



with the MACD chart ,You will see three numbers .

1- the number of periods used to calculate the faster moving average.
2-the number of periods used to calculate the slower moving average .
3- the number of bars used to differentiate between the fast and slow moving averages .

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stochastics
17 June, 2008
stochastics

A stochastic is an oscillator that will help us measure the overbought and oversold conditions in the market . The Stochastic is an another indicator to help us to know where a trend will be ending. A technical indicator used to compare a security’s closing price to price range over a given period .



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