Currency markets are essential for Countries, Companies and Individuals buying imports and selling exports. Think of the last time you went on holiday, you were dealing your home currency for your destinations currency.
So to answer – Is Forex Trading a Scam? – The answer is most definitely, No!
Like most things in life today, it’s the fraudsters who get involved and give currency operations a bad name. Unfortunately this market is littered with them, from large companies down to individuals yet no Governance seems to be in place to put an end to them.
Here’s the cons:
- There are literally thousands of ways to trade currencies, hence the reason it appears so complicated and delivers unpredictable outcomes.
- In order for one person to make a profit, it requires another person to lose.
- The large institutions are better informed regarding the markets circumstances, leaving vast amounts of inexperienced individuals in losing positions.
- It’s widely speculated that 95% of currency traders lose money due to their inexperience and mis-informed information by fraudsters pumping and dumping.
- Due to the fact there’s no regulated exchange that is centralised, the door is open for swindlers to prey on dreamers and no one seems able to stop them.
Here’s the pros:
- It is possible to make money if you stick religiously to your plan
- You will have winning days and losing days – Accept this
- If you can construct a plan with an 80% probability rate you’ve cracked it – I never achieved this
For those dreaming of Fortunes – Tread cautiously
If you are looking to enter into marketing currencies or have been involved with a FX scam and need help, take a look at Giambrone’s Forex Lawyers. They point out the various rackets and dangers of this unpredictable minefield.
Like so many people, I entered my currency career from one of the vast amounts of fraudulent schemes out there online.
They were promising the usual ‘Make a Fortune’ in a few trades, seen commonplace in today’s unfortunate times driven by unscrupulous individuals.
I was fortunate enough to see through this dishonest scheme, ending up moving on to join a FX Broker called MDS Markets, now taken over by Capital Spreads. They were offering a free course run by a true currency trader who used to trade for a bank.
I thought I’d check out this course with the intentions, one day I’d be making my own living through the currency markets if I could learn the ropes.
I have to say the course was excellent – a 5* review.
Dan, the ex-bank trader had these principles:
- Choose a plan and stick to it religiously
- Trade with the trend
- The daily and weekly charts should conform to the same trend
- Wait for retraces back to the daily 20 m/a
- Enter back with the trend on the hourly chart.
- Never trade the news
- Always work with a stop-loss
- Only trade with what you are willing to lose
The marketing plan had an extremely simple approach.
As he said, all the banks trade by following each other, hence – the trend is your friend. So why should we over complicate things.
If you fill a chart up with too many indicators, not only are you attempting to trade too many plans on one chart, you are making your operating experience too busy.
Although for his role in the currency bank, he rarely used technical analysis in the way we were taught, he said the approach is very similar.
The system was simply waiting for the retraces back to the daily 20 m/a.
We’d switch over to the hourly chart, find our entry point and join back in with the daily trend.
Dan had a helpful approach for anyone wishing to join his live trading room. In-order to trade live with him, you first had to complete these steps:
- Complete his detailed video based currency course.
- Set-up your charts as explained in the course.
- Set-up a demo account and trade his plan.
- Apply a stop loss when entering into a trade.
- Double your demo account before joining his live room.
It took me about 6 months to complete this course and double my demo account.
I joined the live room and traded from 7 am throughout the day and thoroughly enjoyed the experience.
After dealing currencies for about a year I switched over from Capital Spreads to GKFX as they allow you to trade from their MT4 platform. MT4 is a great currency suite, commonly used by many FX Brokers. GKFX allowed me to trade from a lower cost per pip which is beneficial when creating a new plan.
My Currency Dealing Plan:
Setting up the Moving Averages (m/a) on your charts.
- Set up a 20, exponential m/a on the weekly, daily, 4 hr and 1 hr charts
- 50 m/a on the weekly, daily 4 hr and 1 hr charts
- 80 m/a on the 1 hr chart (this is a 4 hr 20 m/a)
- Set-up a daily 200 m/a (Institutions use this indicator)
Trading the plan:
- Make sure the Weekly and Daily chart confirm the trend
- Trend up: Daily and Weekly candles must be over the 20 m/a
- Trend down: Daily and Weekly candles must be below the 20 m/a
- Wait for a retrace back to the daily 20 m/a
- Wait for the 1 hr 20 m/a to cross the 80 m/a on the hourly chart
- Enter the trade on a small pullback once the 20 m/a has crossed the 80 m/a
- Make sure you place a stop loss when entering the trade
- Never enter a trade before red news alerts. Forex Factory provided this information.
Make sure the Weekly Trend conforms to the Daily Trend
See both charts above (weekly) and below (daily), the candles are above the yellow line – 20 m/a. A long trade is now possible on the daily chart after a retracement back to the daily 20 m/a.
Example of a pullback to the 20 m/a on the Daily Chart
The yellow line is the daily 20 m/a. I look for a pullback and prefer the black line (4 hr 20 m/a) following the candles not to cross through the 20 m/a.
Now switch to the 1 hr chart and wait for the entry
Wait for the yellow line (1 hr 20 m/a) to cross the red line (4 hr 20 m/a), wait for a pullback and enter the trade long – with the daily trend.
I mainly traded the major currencies against the dollar, example: EUR/USD, GBP/USD, AUD/USD, NZD/USD, USD/CAD, USD/JPY and commodities such as Gold and Oil.
Dan was never favourable regarding entering trades through important news. News can be so unpredictable. His attitude was to let the trade go and we’ll join the trade at a later date on the pullback.
All markets pull back. Even in the market crash in 2008 you would have great pullbacks then get ready to enter when your plan comes into fruition.
Other plans I have tried
Before I would contemplate trading live my first objective is to double a demo account. These are some of the plans I tried:
- Naked charts – Playing off support and resistance levels
- Signal lines
- Fibonacci retrace levels
- Ribbon Bands
- Daily Pivots
- Weekly Pivots
- Monthly Pivots
- Head and Shoulders
- Double Tops and Bottoms
- And the list goes on
The only other strategy I doubled a demo account up and traded live was a system similar to this Daily 20 m/a retracement plan. Trade the retraces to the Weekly 20 m/a using a 4 hr chart for entry. Very similar but takes longer to come into fruition.
Please be very careful entering into this market. There doesn’t seem to be any kind of regulations to stop these scammers. It’s not just individuals, large companies are casting out erroneous information on this market daily. It’s a real pump and dump society, full of lies and deceit. So called Experts that never trade, comment in fine detail on what happened yesterday, yet never tomorrow. Tread with caution.
One informative website regarding learning the ropes for this role is Baby Pips. It’s worth a look for anyone determined to enter into this market. There are plans galore for you to learn. Please double your demo account first before going live.
Was I profitable with the FX Markets?
Unfortunately after staring at charts for 5 years I had to admit, making a sustained living from it became increasingly difficult. I made my decision to move away and start another career.
After a lot of research, I decided to join Wealthy Affiliate and start a career in blogging as they have a FREE Starter Membership. I had no experience in this field and required learning right from the basics. They sure delivered these promises:
- Expert training on how to run a business online – specifically designed for newbies
- How to build a website. I couldn’t believe how straight forward this is – Great fun too
- Help and Support whenever you need it – And they deliver
I now have a stress-free way to build an income, hence my website name. Gone, are my frustrations of trying to make a living in the FX stressful world. No more losing days. No more trying to find a plan with an 80% probability rate. It’s been the best decision I have made as it’s created a wonderful lifestyle.
Every few days I create post that has the potential for delivering great income, month in, month out. Multiply this with all the posts I write in a year, it sure knocks the heck out of staring at a chart all day.
If you fancy diving into a stress-free career, one that doesn’t require any previous experience, take a look at Getting Started. It’s completely free to join as a starter member. This is a calm world without lies and deceit – It’s great fun too!
Thanks for reading my story.
Be careful if you decide to trade the Forex Markets.
Bit of advice – Listen to no one – There’s too many people playing their own book.