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What exactly is the difference between fundamental and technical analysis? And why is it so important for the day trader to have an intimate knowledge of both styles of trading? Put simply, the majority of new traders who enter into the markets, filled with dreams of wealth, do not have a good enough foundation of knowledge with which to build up a successful trading career with. And precisely how does one build this knowledge? Begin with the basics of both technical trading and fundamental trading.

Technical trading is hugely favourite with intraday traders. If you are a new trader you will benefit from swift entry and exit from positions with a sound knowledge base of technical analysis. Put in the simplest way technical analysis means using past price data in order to determine future price movements. An example of this is using resistance and support price levels as a signal for price rises and falls in the near future. But let this not fool you – technical analysis goes much further than this.

Stochastics, moving averages, Fibonacci levels and countless other retracement levels are simply formulas based on past price information. Technical analysis encompasses all this which is why it is crucial that a day trader be familiar with them. It is not unusual to see a trading screen with many different representations of the price using different graphs and data – in fact this is why multiple personal screens are so common in the financial world.

If one combines this knowledge with that of fundamental analysis, you potentially have the capability to make brilliantly executed trades. And what is the difference? Fundamental trading is the method of using a companies financial results, combined with economic data and government statistics in order to make an informed and deliberated view of future price movement.

For example, if you have read that the price of gas is rising, and a current publicly traded utility company released very favourable results, this will signal to you to purchase that stock. Conversely, if unemployment was on the rise and average consequence were falling, you might wish to short sell an entertainment index. Fundamental analysis of stocks requires you to develop a good understanding of what you are actually trading, as opposed to technical trading, where you can be looking at any graph (stock, commodity, futures etc) and it wouldn’t matter because you are only concerned with price movement alone.

Clearly, technical trading is designed for swift in and out trades, where a time frame can last anywhere from a few hours to even a few seconds. This is why it is so favourite with day traders. Fundamental analysis on the other hand means taking a position where the timeframe is greater than a day (generally speaking).

So why would an intraday trader be interested in fundamental trading?

Speaking from experience, to be a successful trader means being healthy to read the markets. This is not an simple feat. You need to be healthy to tie up all the knots and read the signals which are being given to you by the market. Thus, having at least a basic grasp of the fundamentals of the market you are trading will become hugely beneficial in making you a superior day trader, and in turn, making superior profits.

Also don’t forget to keep a day trading diary to help you keep track of your winning and losing trades. You need to know what you are doing wrong in order to improve. Examining your trades can be fun – just kick back after a days trading, get a huge cup of hot chocolate, wearing your best all black converse sneakers and read what you did for the day.

In conclusion, I hope you now discern the importance of having a good knowledge of the two main styles of trading, and I encourage you to learn more if you feel you need to. Happy trading.

Forex Trading Software Testing

lose to 85% of retail forex traders lose money – especially when they first begin off trading. So can a trader make money by using a forex robot trader such as FAP Turbo in his trading? How can you succeed in forex trading by using the FAP Turbo forex software? Is FAP Turbo Forex the saint and proven forex trading software for all currencies?

What is FAP Turbo

FAP Turbo Forex is an auto robot trader. In the simplest form of explanation, FAP Turbo evaluates trading setups, and then advocates and grant you to trade these setups automatically, taking the loss or profit whenever it closes the trade.

Problems In Using Robot Trading Software

In theory, it is all perfect. What is superior than a trading robot who does all the work for you and gets the work done with the saint desired results- so that the end result is that you reap a gigantic profit? Indeed, the dream of the trader who aims for the highest profit is to be healthy to refer the saint trade setups where you can purchase at the lowest and sell at the highest, something that a forex robot trader can be programmed to work idealistically,easily and mechanically without emotion.

However, in practice, we grappling problems, and these are the difficulties that anyone who wants to succeed in forex trading with FAP Turbo Forex must recognize. Forex Trading Software Testing

Firstly, what level of confidence can we attach to trading with the FAP Turbo forex robot? Since we are not the programmer of the robot, we are not familiar with its trading algorithm, and how it picks the trading setups. Most importantly, how does it identifies a trading setup, and what is the risk level attached to its programmed trading setups that will grant you to “stop loss” and exit a trade? Without being told these facts which have been used in its program,what can you do to ensure you can succeed in forex trading using FAP Turbo?

Circumstantial Evidence Testing

As a seasoned and experienced trader, we can adopt a circumstantial method to find out whether FAP Turbo can generate good results and thereby offers evidence of success for which it is programmed for.
If we are unable to know how FAP Turbo is programmed, we can indirectly gauge its usefulness from the results of using it.

Now, generally, many software, FAP Turbo forex included, will lead you to a website to look at results from using the software. There will normally be a display of figures that will show how profitable it is in the current past of using the software. The general premise is that since it performed well in the past, it has a good propensity to generate you the same profits into the future.

That is, in part, a fallacy. Past performance does not equate to future performance because of different trading trends covered in the time span of the previous trading period. In other words, you might be making huge profits in a prolonged upward trend, but now the trend has changed decidely to bearish, and that upsets the trading algorithm and will not generate similar profits.

So how then can we test FAP Turbo Forex and obtain more than reasonable evidence that it can help you become a successful forex trader?

Most trading software will present trading results as circumstantial evidence that their software will work mainly trading results based on a backtest. In the more discerning ones, forward tests are included.
In conducting the backtest and forward test, we take a block of historical data, and divide the data into two parts, using one part of the data for the backtest and the second part of the historical data for the forward test. Forex Trading Software Testing