Relative St rength Index (RSI): The RSI measures t he rat io of up-moves t o down-moves and normalizes t he calculat ion, so t hat t he index is expressed in a range of 0-100. If t he RSI is 70 or great er, t hen t he inst rument is assumed t o be overbought (a sit uat ion in which prices have risen more t han market expect at ions). An RSI of 30 or less is t aken as a signal t hat t he inst rument may be oversold (a sit uat ion in which prices have fallen more t han t he market expect at ions).
St ochast ic oscillat or: This is used t o indicat e overbought / oversold condit ions on a scale of 0-100%. The indicat or is based on t he observat ion t hat in a st rong up-t rend, period closing prices t end t o concent rat e in t he higher part of t he period's range. Conversely, as prices fall in a st rong down-t rend, closing prices t end t o be near t he ext reme low of t he period range. St ochast ic calculat ions produce t wo l ines, %K and %D, t hat are used t o indicat e overbought / oversold areas of a chart . Divergence bet ween t he st ochast ic l ines and t he price act ion of t he underlying inst rument gives a powerful t rading signal.
Charts and diagrams
Forex chart s are based on market act ion involving price. Chart s are maj or t ools in Forex t rading. There are many kinds of chart s, each of which helps t o visually analyze market condit ions, assess and creat e forecast s, and ident if y behavior pat t erns.
Most chart s present t he behavior of currency exchange rat es over t ime. Rat es (prices) are measured on t he vert ical axis and t ime is shown of t he horizont al axis.
Chart s are used by bot h t echnical and fundament al analyst s. The t echnical analyst analyzes t he “ micro” movement s, t rying t o mat ch t he act ual occurrence wit h known pat t erns. The fundament al analyst t ries t o f ind correlat ion bet ween t he t rend seen on t he chart and “ macro” event s occurring parallel t o t hat (polit ical and ot hers).
What is an appropriat e t ime scale t o use on a chart ?
It depends on t he t rader’ s st rat egy. The short -range invest or would probably select a day chart (unit s of hours, minut es), where t he medium and long- range invest or would use t he weekly or mont hly chart s. High resolut ion chart s (e. g. – minut es and seconds) may show “ noise” , meaning t hat wit h f ine det ails in view, it is somet imes harder t o see t he overall t rend.
The maj or t ypes of chart s:
Most chart s present t he behavior of currency exchange rat es over t ime. Rat es (prices) are measured on t he vert ical axis and t ime is shown of t he horizont al axis.
Chart s are used by bot h t echnical and fundament al analyst s. The t echnical analyst analyzes t he “ micro” movement s, t rying t o mat ch t he act ual occurrence wit h known pat t erns. The fundament al analyst t ries t o f ind correlat ion bet ween t he t rend seen on t he chart and “ macro” event s occurring parallel t o t hat (polit ical and ot hers).
What is an appropriat e t ime scale t o use on a chart ?
It depends on t he t rader’ s st rat egy. The short -range invest or would probably select a day chart (unit s of hours, minut es), where t he medium and long- range invest or would use t he weekly or mont hly chart s. High resolut ion chart s (e. g. – minut es and seconds) may show “ noise” , meaning t hat wit h f ine det ails in view, it is somet imes harder t o see t he overall t rend.
The maj or t ypes of chart s:
Online training, no downloads
Easy-Forex™ is dedicat ed t o educat ing it s cust omers. Cust omers can access FREE one-on-one online t raining. The t raining goal is t o t each people specific st rat egies for t rading currencies over t he int ernet . Bot h novice invest ors and expert day t raders have benefit ed f rom t he t raining provided by Easy-Forex™.
The “ demo” account idea
Many Forex plat forms of fer new regist rant s a “ demo” account . A t ypical example would provide 10, 000 “ demo” dollars t hat can be “ t raded” as a means of learning how t o succeed in Forex.
Easy-Forex™ does not of fer “ demo” account s. Coming t o underst and t hat reason must rule over emot ion is t he most import ant lesson a t rader can learn, and it cannot be done wit h play money. If t here is no consequence t o indulging in emot ional responses t o t he market , t here is no learning, so “ demo” account s t end t o have l it t le educat ional value. Rat her, Easy-Forex™ allows you t o st art t rading wit h j ust $100, including full access t o one-on-one t raining. New regist rant s are t hus able t o garner bot h an educat ional and experient ial benefit unavailable t hrough simulat ed sit uat ions.
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