Forex Trading Guide

forex trading Navigation



Forex News
Easy Forex Made
Forex Signals
Forex Forecast
Forex Chart Programs
Best Brokers For The Forex Markets
Forex Trading Alerts
Best Brokers For The Forex Markets
Forex Trading System
Bay Area Forex Group
Forex Alerts
Remote Forex Trader
Forex Forcast Software
Forex Day Trading
Best Forex Brokers
Forex Trading Forums
Forex Online Trading
Micro Forex Trading
Best Time To Trade Forex
Forex Bureau
Forex Infomercial
Day Trading Forex
Trading Forex
Forex Day Trading Signals
Nzd Usd Forex
forex trading Links


2010 Best Seller!

forex strategy explained
Buy it now


Best forex trading products




Automatic Social Bookmarking
socialize it

Main forex trading resources

forex trading

 

 

Welcome to Forex Trading Guide

Article

How To Loose Everything - The Worst Forex Trading Strategy Ever That You Might Be Using
David Jenyns

You may be wondering, `Why would David Jenyns write about the worst Forex trading strategy around?`

There are a couple of reasons:

First, to warn you about the worst Forex trading strategy, because you really don`t want to end up using this system.

Second, because once you know the worst possible Forex trading strategy, the one that is designed to maximize your losses over the long run, then you can reverse it to craft a strategy which does the exact opposite.

With what you learn from the worst Forex trading strategy, you will be able to create a system that will produce some tremendous long-term gains. The worst Forex trading strategy I`m referring to, which is simply the worst Forex trading strategy I have ever encountered, is known as averaging down. This horrifying Forex trading strategy is the process of buying more shares that you had previously acquired, as the price drops.

Traders often purchase shares this way in an effort to reduce their initial entry price.

Only bad investors average down by buying shares of a sinking assests to decrease their overall average price per share. This Forex trading strategy is hardly ever effective, and is often like throwing good money after bad. It also magnifies a trader`s loss if the share keeps dropping. Remember, just because a share is cheap now that doesn`t mean it`s not going to get any cheaper. However, let`s examine how this devastating Forex trading strategy works. Say you bought one thousand shares at $40.

The novice investor may not have a stop loss in place, and the share price falls to $30 dollars. Here comes the stupidity of this Forex trading strategy to average down the novice trader might by another thousand shares at $30 to lower the average cost per share that he`d already purchased. So, his average cost per share would now be $35.

Unfortunately, the share price may fall even further, and the novice trader will again buy more shares to reduce the average cost per share. They end up buying more and more into a share that`s losing their money.

Now, imagine this Forex trading strategy being applied to a portfolio of assets. In the end, all the capital will automatically be allocated to the worse performing assets in the portfolio while the best performing assets are sold off. The result is, at best, a disastrous underperformance versus the market.

If a trader uses an averaging down system and uses margins, their losses will be magnified even further. The biggest problem with this Forex trading strategy is that a trader`s gains are cut short, and the losers are left to run. My advice is never average down. The process of buying a share, watching it fall, and then throwing more money at it in the hopes that you`ll either get back to break even or make a bigger killing is one of the most misguided pieces of advice on Wall Street. Never be faced with a situation where you`ll ask yourself, Should I risk even more than I originally intended in a desperate attempt to lower my cost and save my butt?`

Instead, design a simple, robust system with good money management rules. I can practically guarantee the results will be better than averaging down.



About The Author


David Jenyns is recognized as the leading expert when it

comes to designing profitable forex trading systems.

Discover the "secret formula" of trading that anyone can use

to consistently generate BIG profits from the market by
downloading your FREE copy of David's new Ultimate
Forex Trading Systems course.

Click Here To Download ==> Forex Trading Systems


http://www.ultimate-trading-systems.com/forex.htm




forex trading News

forex trading

Currency markets were stable in early Asia trading on Tuesday following a bumpy session for the pound a day earlier. The British currency was 0.1 per cent firmer against the US dollar on Tuesday at $1.3121. Sterling swung on investor concern over British ...

Read more


Forex trading cools in Asia after volatile Monday session

The first part of our forecast is based upon our research of the past 16 years of Forex prices, which show that the following methodologies have all produced profitable results:·Trading the two currencies that are trending the most strongly over the past ...

Read more


Trading Support And Resistance - Week Of Nov. 20

Note: All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer. Trading foreign exchange on margin carries a high level of risk and may not ...

Read more


Forex Trading Opportunities for the Week Ahead 20 November

LONDON (Reuters) - A controversial trading tactic used on the $5 trillion (£3.78 trillion) a day foreign exchange markets has been banned by a global committee of central bankers and industry officials. The Global Foreign Exchange Committee said on ...

Read more


Global forex code bans 'last look' trading tactic

Investing.com - The dollar was trading near three-week lows on Wednesday as lackluster U.S. inflation data and diminishing expectations that Republicans will be able to push through a tax overhaul this year weighed. The U.S. dollar index, which measures ...

Read more


Forex - Dollar Remains Broadly Lower After U.S. Data

"I don't think this is going to be a massive driver, but that's certainly the influence that we're getting right off the bat," said Stephen Innes, head of trading in Asia-Pacific for Oanda in Singapore, referring to the political developments in Germany.

Read more


FOREX-Euro slides after German coalition talks break down

The GBPUSD is now trading lower on the day, after a run higher (and a break to a new 11 day highs failed. The pair completed its up and down lap. Concerns about Brexit seem to be the catalyst (the stock excuse for a sell off but with truth to it).

Read more


Forex technical analysis: GBPUSD back to MA cluster area.

The AUD/USD is trading higher early Thursday after reversing earlier weakness ... Taking out this price later in the day could drive the Forex pair into the June 14 bottom at .7532. The short-term range is .7729 to .7763. If the reversal bottom forms ...

Read more


AUD/USD Forex Technical Analysis – Setting-Up Possible Closing Price Reversal Bottom

Forex & Money EXPO is about to become the biggest world Financial Expo-Forum covering Financial and FX Trading Industry as well as it claims the role of the most favorable way to build up the business connections and widen industrial knowledge. Forex ...

Read more


Forex & Money EXPO 2018: The Largest World Forum-Exhibition Will Take Place In Singapore In October 2018

EURUSD is 0.35% higher in early Friday trading at around 1.1808. USDJPY is 0.5% lower, currently trading around 112.52. GBPUSD is 0.3% higher in early session trading at around 1.3230. Gold is 0.33% higher, currently trading around $1,283. WTI is little ...

Read more


Top Resources