Try going to forex.com to get a practice account. They have active traders who give you real-time advice, and have regular live programs to get you initiated into the basics of technical analysis and such.

Also – I have opened a new forum and blog site this week, and we do a lot of forex discussion. I used to do it somewhere else, but got tired of the overbearing owner who stiffled dissenting opinions. Visit us at http://www.3mx.org/forum – the Free Market Forums. I do regular analysis, and post my thoughts – there are others already there as well, and we’ll grow very quickly. I encourage you to drop by and see what we’re doing.

http://www.3mx.org/forum

Was wondering if I can pick your brain again!

Looking at several currency pairs, it looks to me like a lot of them closely follow the 5 sma. In the past I messed around with a stock trading strategy based on using the 5 sma. The basic rules for entering long were something like: 1) The 5 sma should be heading upward at the time you enter; 2) Enter when you get a bar that closes above the 5 sma. Reverse these rules for going short.

I am thinking of checking this out along with sto-21, macd, and rsi to help me. Is the 5 sma a common indicator for use with forex?

I got on your broker site and plan to do all the free webinars, etc. Looks like they have a lot of good info on there.

thx and sorry for the basic questions, later mike

Fortunately, I had taken all my stops off because I planned to be at the keyboard watching this move. I would have been cranky if I’d let the head-fake at the open stop me out of my positions….

I use the stochastic, MACD and RSI with various settings, but rely heavily on technical levels such as support/resistance and trend as my primary indicators. Fibonnacis are also a standard part of my analytical rigor….

Moving averages are the most effective indicator I use in the heat of battle. Using the charts above, you can see how often these levels become points of reversal or breakout. I’m always aware of where the moving averages fall, and usually swap back and forth between a 15-minute and hourly chart while trading. Most traders use moving averages, so using them becomes somewhat of a self-fulfilling exercise…..

I can’t recommend any particular book or resource. General technical analysis resources are a good place to start, and in my experience TA is much more effective in currencies than equities. Forex.com offers regular training sessions on charting and various aspects of it, and I believe they are archived at the site. Not sure if you have to be a member, or at what account level to access it….

I charted up the eur/jpy (1 day, with 15 minute bars)to see what I could make of it. I added the signals I like to use for stocks: macd (12,26) and slo stoch (21), and I would say it is on its way down, therefore sell (short) it. I am also messing around with RSI stoch 100 and that looked like it was saying the same thing as well.

Do you use indicators such as these and/or any other ones? I noticed you use moving averages in your discussion of the trade. Do they help you a lot?

Also would you be able to point me in the direction of some basic info on forex, I am interested in its similarities or differences compared to trading the stock market, since this is all I am familiar with right now.

thx again mike

I’m guessing thinkorswim probably has good charts and analytical tools…. I’ve been considering taking my business there so I can consolidate all my trading into one account. I hear nothing but rave reviews, so I’m guessing your as well off there as anywhere. I use Forx.com at the moment…..

The key to being successful (in my estimate) is not to chase a trade. Learn to be okay sitting on the sidelines until you have conviction about a move. With the heavy leverage available, you can make a lot in a hurry. Don’t feel like you’ve got to be playing everyday.

I just got interested in forex a couple weeks ago and figure I will check it out a little more closely. I already have an account at thinkorswim and am planning to start paper trading at first. Do you think it makes much difference which broker you use? Any info on this appreciated thx Mike

Holler if you need any assistance.