Is trading in currencies easier or harder, learning curve wise, than trading stocks?
Thursday, September 10th, 2009 at
7:30 pm
Ducati 996R asked:
I’ve been trading stocks for a year or so and want to expand into different types of trading like opening a ForEx account. How long did it take you to get a hang of it and any good books or authors on the subject?
I’ve been trading stocks for a year or so and want to expand into different types of trading like opening a ForEx account. How long did it take you to get a hang of it and any good books or authors on the subject?
Tagged with: Good Books • Learning Curve • Trading Currencies
Filed under: Forex
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it depends on how you traded stocks.
if you used only technical analysis, then you should be fine. TA is TA no matter the market.
keep in mind, forex is open 24 hours.
i would suggest you stick with the daily chart time frame and only go to lower time frames once you know what you are doing.
also, you must use money management ! This is an absolute.
I would suggest toni turner books
and
I’ve been trading in both and in my humble opinion currencies are more difficult to predit and invest in. Currencies involve governments and are subject to more factors than companies that issue stocks. At least with stocks I just monitor the news everyday. Currency fluctuations are subject to economic pressures and politics.
Hullo
I have been to Forex trading. It is pretty tempting to involve in such business but ITS VERY HARD. When I used to operate my live account (not demo), I was getting pale and weak. My family instantly observed it and forced me to quit. But I carried on until I had lost every money I had.
My maternal uncle is right now in prison coz he had taken loans from differnet persons as investment for this business. He was earning innitially, but he failed to cope with the intensity later on.
A friend of my maternal uncle, whome he was impressed and decided to plunge into this business, has lost an amount of $1,61,290.00. Can you imagine how much time he had spent adn how much loss he had to bear to pile up such a huge amount???
And now to avoid being jailed, he has gone overseas.
There r plenty of books and plenty of people who claim to guide you about it. They do a good job at building up your mind for it but they are not the ones who gonna buy or sell. Its ultimately you. Rob Booker is very famous. you may search 4 him online. Subscribe to Saxo Bank’s free online Daily articles as well. Saxo Bank’s articles are d best believe me.
Thgere are many platforms as well i.e. Saxo Bank, FXCM etc. I have been using FX Solutions platform for that.
Another thing I noticed I think I MUST TELL YOU that noone in this world, noone in this world and noone in this world would guide you for currency trading. they would just give you a glimpse of it just to motivate you. The practical is very different dear.
I dont know how old you are but I am 23 and still learnt alot of things. Now, I have been to jobs for last 3 years and I had quit all that stuff way back when I was 20.
Hope you stay away from d crap.
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Mr K
Islamabad, Pakistan
Look, their is a fundamental difference between FOREX and stock trading. You need to identify the macro events of what the hell you’re doing, not micro.
Imagine, you look one day, the Japanese market for example ( weak yen, exporters surge….US market strong dollar….weak US commodity prices..oil falls…bond prices fall(yields rise), Multinationals do poorly etc.) But you need to put everything into context. In a strong bull market for stocks or currency, it doesn’t matter what is happening….if you own momentum stocks/currencies they will do well……look at apple, rimm, all oil services, amazon, potash, deere, CAT, garmin(in the bull market until Sept.) all did very WELL….but now, you see you have to pick and choose….Which sectors are performing well and why? Is it innovation or a relief that is a rally in their stock price(they arent going under, writedowns weren’t realized etc.)…..what affects the equity price…creativity(apple) or is it rising commodity prices(the ETF OIH)….all of these are micro events within the company but more of a “cross sectional” of the market sentiment…..Realize this, you can make money hand over fist in a bull market, if you believe it or not “follow the crowd” ie..First Solar, BIDU…But the market has changed, all stocks arent in favor like they were before the summer….in the summer **** hit the fan as you know (financials brought everything down) the entire credit “crunch” is just foolish lending which isn’t “fungible”—interchangeable- it cannot be incorporated into the companies ‘continuing operations’ and passed as earnings/fees, they have unrealized losses( Citi, Lehman(be careful with them) WM etc.) HSBC wrote down over $1billion dollars in Jan of 07, 6 months before any other firm had a thought of it…that trade was set up for you right there! Look at Capital One today, they had an increase in what i call “collection” for auto loans( who pays for these things that they book when the lease is signed!) Think! Just an afterthought, do you really think Citi/Merrill,Morgan,GS,BX,WM,CFC,Fannie/Freddie, will actually realize all these losses they “mark to market” in their portfolio, not a chance in HELL, let things settle(if they do(realize losses), prepare for the most financial market pain ever experienced)…that was al ittle off subject but i hope you get the rationalization, trying to add some brevity(simplification)
As for currencies, i feel Governments are far more predictable than the equity or bond/interest rate markets…look at the world right now…okay…here we go! Just for an example, what currencies did well after the 2002 Bear Market, look to the Eurozone, Sweden(krona) and Germany ie. Euro….were down about 45%….basically like the DOW at 7,500….aren’t US companies worth more is what i said!?? The Euro at 1.60(are you serious, is the US losing their competitive advantage regarding innovation and intellectual capital?-I don’t F-ing think so)
Look at my previous posts, i said the FED funds goes to 2% and it did, what did i do? Short the future fed funds May contract(got slightly lucky), yielding 75%, i rarely toot my own horn, but this was like a hot blonde in a white t…it was obvious!!
Currencies, look at credit risk(budget deficit/surplus) look at GDP, look at “transaction risk”..who do they do business with(is it suceptible to the business cycle (more/less)+/- than others)…do the currencies appreciate because they export more/import more….what do they do in a strong economy vs. weak economy(GDP per Q less than .75%)? Take the Yuan as an example, buy the ETF instead of the currency outright in a FOREX account, China has no intentions for their “baby” yuan to depreciate, and the US realizes that, why do you think we change taxes/tariffs on imports from the cheap labor regions……
Don’t read any books, they only reflect what has already been done….(you want a “leading indicator…..ie.the equity&bond markets) not a lagging one, buy an economics book, learn about what type of flucuations the markets experience and in the most basic terms supply and demand…if you buy anything buy something from published in the 50’s & not after the 90’s…..the law’s of economics no longer exists…why? With regard to currencies, if the Euro and Pound in 2007 had not appreciated so much, the ole’ Dollar would be your play for the future….sit back, relax & ponder about the future, who is it that will prosper and why? Trade or Innovation or Education? Only time will tell, but your best bet my friend is to observe the markets, respect them and they will treat you well….you’re not a day trader, you know very little, learn & exploit..
Sorry for the essay, I got excited, email me for
I’m in the BIZ and need to foster capitalism!
Mine does not take long to learn as everything is automatically done by robot software.
9,000% in 10 months doing nothing.
In this crisis year, 1000% in 1 year automatically!
it’s a lot riskier than trading stocks- there are actually companies behind stocks who issue new bulletins, and profit forecasts – data is there for research – currency trading is closer to gambling – you’re mostly guessing which way the currency will go
Focus more on fundamentals than technical analysis. Economic news analysis is what moves the markets.
Here is a free site that shows what has happened after economic news releases: