Forex Made Easy : 6 Ways to Trade the Dollar

Forex Made Easy : 6 Ways to Trade the Dollar

by James Dicks


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The first plain-English introduction to foreign currency exchange trading—one of today's hottest profit opportunities

The foreign currency market is the largest financial market in the world, and foreign exchange trading is quickly becoming one of today's most high-profile, potentially lucrative markets. One problem is that books on the topic are complex, technically dense, and difficult for Forex novices to grasp.

FOREX Made Easy is the first book to approach the topic in a detailed yet accessible style, gradually and deliberately moving from simple to complex in easy and natural language. Author James Dicks—founder of the popular trading software 4X Made Easy—draws upon his trading knowledge to give readers only the information they need, from setting up a workstation to trading electronically.

This Forex guidebook provides traders with:

  • An easy-to-follow, six-step process for FOREX trading
  • Methods for gaining an advantage using technical analysis
  • Dozens of examples to illustrate key points

Product Details

ISBN-13: 9780071438940
Publisher: McGraw-Hill Professional Publishing
Publication date: 03/15/2004
Pages: 256
Sales rank: 722,620
Product dimensions: 6.40(w) x 9.30(h) x 0.87(d)

About the Author

James Dicks is president and CEO of PremiereTrade. One of today's leading authorities on trading the foreign currency exchange market as an innovative means of diversification, Dicks speaks to more than 60,000 traders each year through his popular training sessions. He lives in Orlando, Florida.

Table of Contents

Preface xiii

Acknowledgments xv

1 What Is the FOREX? 1

Introduction 1

FOREX Defined 12

A Brief History of the FOREX 13

Free-Floating FOREX Market 13

Major FOREX Participants 14

2 More FOREX 15

Currency Pairs 15

Recommended Currency Pairs 16

Why Trade the FOREX 19

Volume in the FOREX 19

Analyzing the FOREX 23

How Profits Are Made 23

The FOREX as a Two-Way Market 25

3 Forecasting the Market 29

Fundamental Analysis 29

Technical Analysis 32

Fundamental versus Technical Analysis 33

4 Currency Options 35

Currency Options Introduction 35

Options Pricing 36

Advantages of Trading Options 37

European and American Options 37

Exotic Options 38

Lock in Profits 40

Accelerate Your Profits 41

5 Creating a Workstation for Trading 43

Workstation Location 43

Trading Computer and Accessories 44

Internet Connection 45

Trading Software Programs 45

Continuing Education 48

6 Fundamentals of Trading 51

Introduction to Trading Theory 52

Trends Defined 53

Trend Cycles 53

High-Probability Trading 55

Sideways, Nontrend Strategy: Wait for Strong Trends 55

Uptrend Trading Strategy: But at Dip Bottoms 55

Downtrend Trading Strategy: Sell at Rally Tops 58

Symmetrical Triangle 58

Ascending Triangle: A Bullish Continuation Pattern 63

Descending Triangle 65

The Falling Broadening Formation 67

Support Breakdown or Resistance Breakout 67

The Double Bottom 68

Head and Shoulders (Crown) 70

7 Economic Fundamentals 73

Introduction 73

Economic Indicators 74

Inflation Indicators 76

Employment Indicators 78

Consumer Spending Indicators 78

Leading Indicators 79

8 Introduction to Technical Analysis 81

Technical Analysis Defined 81

Technical Analysis Assumptions 82

Bar and Candlestick Charts 83

Technical Analysis Terms 86

Market Patterns: Uptrends, Downtrends,and Sideways Trends 87

Support and Resistance 95

Moving Averages 95

9 Advanced Trading Charts and Indicators 103

Tools for Technical Analysis 104

Bollinger Bands 104

Directional Movement Index (DMI) 107

Stochastic Indicator 107

Moving Averages (Simple, Weighted, and Exponential) 110

Moving Average Convergence/Divergence (MAC/D) 116

Momentum 119

Relative Strength Index (RSI) 119

Rate of Change (ROC) 122

Volume 122

10 Fibonacci Numerical Sequences and Elliot Waves 125

Introduction 125

Fibonacci Rectangles and Shell Spirals 127

Fibonacci Retracements 128

Fibonacci Extensions 128

Fibonacci Time 129

Fibonacci Circles 130

Elliot Waves 135

11 Money Management Principles 139

Trade with Sufficient Capital 140

Exercise Discipline 140

Be Patient and Persistent 141

Employ Risk-to-Reward Ratios 141

Follow Trading Rules 143

Accept Losses 144

Always, Always Use Stops 144

When In Doubt, Stay Out 145

Never Overleverage Your Account 145

Make Realistic Goals That Can Be Achieved within Reason 146

Always Trade with Money You Can Afford to Lose 147

Protecting Your Profits 147

Keep a Trading Log 147

12 Six Steps to Success 149

Identify Current Long- and Short-Term Trendsand Which Trend to Trade 149

Check News and Market Announcements 150

Identify Support and Resistance Levels 151

Use Studies and Indicators for Entry 151

Buy at Dip Bottoms (Uptrends) or Sell on RallyTops (Downtrends) 151

Use Proper Money Management 152

13 Getting Started with a Trading Station 155

Access the PremiereTrade Web Site 156

Install and Run the Dealing Software 156

Open a Demo Trading Account 156

Dealing Rates Window 157

Open Positions Window 159

Accounts Window 161

Multiple-Accounts Window 163

Orders Window 163

Placing a Market Order 164

Placing a Stop/Limit on an Open Position 167

Change Price on a Stop/Limit (Open Position) 168

Delete Stop/Limit (Open Position) 168

Close an Open Position 169

Placing an Entry Order 170

Change an Entry Order 171

Canceling an Entry Order 173

Reports 173

Customizing the Trading Screen 173

Trading Station Options 175

14 Corporations in the FOREX 179

Introduction 179

Forward Transactions 180

Examples of Strategies 181

Portfolio Management and Currency Risk 183

15 The Business of Trading 185

Staring your Business 185

The Tax Code 186

How to Become a Trader 187

What If I Don’t Make Enough Money to Use

Those Deductions? 188

How to Make the Win/Win Better 188

What Kind of Corporation Should You Use? 189

Let’s Take a Look at Some Examples 190

Appendix: Bretton Woods System and Post–BrettonWoods System 193

Glossary 199

Bibliography 207

Charts, Figures and Credits 207

Index 209

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Forex Made Easy : 6 Ways to Trade the Dollar 2.8 out of 5 based on 0 ratings. 6 reviews.
Anonymous More than 1 year ago
Guest More than 1 year ago
has a good section on patterns or indicators to look for. This was my first forex book and I would recommend it. the software they advertise is decent but i would not trade live with it as it locks up on occassion.
Guest More than 1 year ago
I made the mistake of buying this door stop. It's nothing more but a promotional piece to get you to his website and sell you software and broker services. The 'information' he gives can be found on any forex website.
Guest More than 1 year ago
The forex made easy is a good book for a novice who has no idea about what forex is and does not have a clue of how to get started, but for anyone who has a clue of what forex is and is looking for strategies/setups to trade the forex for profit this book would be a waste of time. P.S. This is a book I recommend to individuals who want to know what forex is about without going on the internet.
Guest More than 1 year ago
I purchased this book after reading the reviews on this website along with some others expecting to gain the knowledge in the Forex area that I would need in order to feel comfortable trading currencies. I was disappointed when I started reading and all it did was cover the fundamentals of the Forex market and its history. I was also disappointed to feel that the sole purpose of this book was a promotional tool in order to get his readers to open an account with his online trading platform (in which the demo account is free for 30 days and then they close and make you open a real account). I would not say that the whole book was bad because he does give some insight into some trends on candlestick charts but not the technical analysis you would need behind the chart movements to feel comfortable in trading currencies. Also, there was a small section about opening up a trading business that was informative for tax purposes but this book was not what I was looking for. I would have enjoyed it much more if he had showed some of the trends and shared the methods he uses in order to make sure a trade he is placing is secure.
Guest More than 1 year ago
I have just finished reading the book from cover to cover. I have traded stocks and futures and I wanted to diversify with currencies. I bought the book and started reading it on a plane ride. It was excellent. There was the compulsary basics and definitions, but then the book went into advanced details on trading strategies, real world applications and honest how to instructions. I was impressed and have decided to start trading. It was also interesting that 3 people stopped me on the plane to ask about the book. I have a positive first impression of the Forex Market and have opened a demo account to practice paper trades as the book suggested.