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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 ap… More >>
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This fascinating book is loaded with practical information designed to help you in the commodity market. The author’s method…proven by his million dollar success…does not involve complicated math or subjective evaluation. There are two completely systematic methods; %R and Momentum. The essence fo these methods is that they tell you if the super powers are long or short; when the super powers expect a major move to start; what commodities are in true bull or … More >>
How I Made One Million Dollars … Last Year … Trading Commodities
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Tags: Commodities, Dollars, Last, Made, Million, trading, Year 
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“Volatile Markets Made Easy is not just a book; it is a full course of instruction. This is an incredible piece of work.” –Ned W. Bennett, CEO/Cofounder, optionsXpress, Inc. “I highly recommend Guy Cohen’s Volatile Markets Made Easy, which introduces to the world his simple approach utilizing flag chart patterns to capitalize on trending stocks. Guy’s combination of clear explanations and lavishly detailed follow-throughs of trade examples cogently demonstrates how… More >>
Volatile Markets Made Easy: Trading Stocks and Options for Increased Profits
Remember the old TV show, WKRP in Cincinnati, in which the dorky Les Nessman would always give the pork bellies report?
Or how about the 1980’s movie, Trading Places, in which Eddie Murphy and Dan Akroyd corner the orange juice market? These are both examples of commodity trading in the popular media.
Commodity trading is one of the fastest growing sectors of the financial markets, and for good reason – in 2006, commodity prices have gone through the roof. If you haven’t heard anything about the prices of pork bellies or orange juice skyrocketing, that’s because there is much more to commodity trading than just these two items.
Corn, oats, soybeans, wheat, soy meal, bean oil, cattle, coffee, sugar, cotton, steel, copper, silver, gold, platinum, natural gas, crude oil, and gasoline are just a few of the dozens of commodity trading options. Metals – steel and gold, in particular – and petroleum-related products, have seen major price movements in the past year.
Commodity Trading – Buy Low, Sell High; Or Sell High, Buy Low
If you remember back to Trading Places, the classic commodity trading comedy, Eddie Murphy and Dan Akryod entered the trading pit and immediately started selling orange juice contracts.
They didn’t own any orange juice, but they were able to sell it anyway. This is how commodity trading works – you either hope to buy low, sell high; or sell high (first), and then buy low.
Commodity Trading Hedgers
This aspect of commodity trading can best be understood by taking a look at the market participants. On one hand, you have the hedger. Hedgers want to guarantee commodity prices in order to lock in profits or avoid excessive losses.
For example, imagine a jewelry maker who needs 1000 ounces of gold to make a collection of necklaces. He needs the gold in six months, but the way gold prices have been going up, he’s worried that he won’t be able to afford it.
To hedge in the current price of $500 per ounce, the jewelry maker could buy ten 100 ounce futures contracts on a commodity trading exchange. Then six months later, if the price has gone to $700, the value of his contracts will have gone up by $20,000 each.
He can sell the contracts for a profit and use the proceeds to buy the actual gold, which will result in a net price of $500 per ounce.
If, in the above example, the value of gold had actually fallen to $400 per ounce, the jewelry maker would have lost money. He’d be locked in to paying $500 per ounce for gold when the actual market value was only $400.
Still, if the jewelry maker’s primary concern was to not end up paying $700 per ounce, this will have been a valuable commodity trading experience. In this way, hedgers use commodities contracts like insurance.
Commodity Trading Speculators
On the other side of commodity trading is the speculator. This is someone who has no business interest in wheat, crude oil, or copper, but essentially gambles on the price of each commodity going up or down.
Commodity trading is very popular with speculators because it requires very little margin. This means that commodity trading speculators can control thousands of dollars worth of commodities for just a few hundred bucks.
The downside of leverage in commodity trading is that it can lead to very big losses that you might not be prepared for.
For this reason, your credit history will be more important when applying for a commodity trading account than an account to trade in almost any other financial market.
If you want to learn forex trading then you should know the story of the turtles who were a group of traders with no experience went on to make $100 million dollars in just 4 years. How did they do it? Read this article and you will find out and it will inspire your forex education.
The Experiment
Legendary trader Richard Dennis set out to prove that anyone could learn forex trading with the right education and mindset – he believed that traders were made not born and set out to prove his point.
He gathered a group of people together who only had one thing in common – they had never traded before. They included a security guard, some professional card players, an actor, a female auditor and a kid fresh from school just to name a few.
The Results
After 14 days of trading education he set them off to trade and the result was:
They made $100 million for him in just 4 years and went on to make a lot more and become some of the most famous traders of all time.
The Education
So what did Dennis teach them? He taught them a very simple forex trading method which was basically a long term breakout strategy combined with rigorous money management rules to preserve equity.
Dennis knew however that a trading system is not enough to succeed its having the discipline to follow it through long periods that is. He made sure the traders he taught knew how and why the system worked and even when it lost he taught them to stick with it and not deviate from the rules.
Rules are rules and must be followed with discipline – if you don’t have the discipline
This took him just 14 days and the rest is history.
What You CAN Learn
There are several lessons that you can learn and the salient ones are outlines below.
1. Everything about forex trading can be learned
If you have the willingness to apply yourself. OK you may not become as successful as this group – but there is a big difference between something being impossible and something being achievable.
2. Simple systems work best!
Today many people think that the more complicated a system is the more likely it is to be successful – but this is simply not true. Simple systems have always worked best and always will, because they are more robust with fewer elements to break.
He also taught rigid money management and made the first priority the protection of capital. If you lose what you have you can’t trade anymore.
It’s a bit like the old obvious gambling saying – to win you need to bet – but you can’t bet, if you don’t have any chips! Obvious but true, so you play great defense first and the profits will come, when the right opportunities present themselves.
3. Discipline is the key
You will here it time and time again how discipline is the key to forex trading success and it is – if you don’t have the discipline to follow your method you have no method.
Discipline comes from confidence in what you are doing, this is why he taught the turtles how and why the system worked and didn’t tell them to follow it blindly.
Trading success comes from within and this means acquiring confidence and discipline.
So if you want to learn forex trading correctly, learn from the turtles:
The potential is huge, you only need a simple system, good money management and most importantly – the confidence and the discipline to apply what you have learned.
The reason most traders never succeed is they never learn the importance of the latter and want to follow others – but you don’t get these traits following others, they come from within.
If you have not heard of the turtles then you will find their story inspiring.
They had no experience of trading yet in just 14 days they were taught to trade and went onto become trading legends and make millions.
How did they do it?
If you want to learn forex trading and be successful then their story will point you in the right direction.
The Debate
In 1984, legendary trader Richard Dennis taught a simple technical trend following system to a group of students, to prove that, trading was a skill that could be specifically learned. Dennis was settling a debate with his friend William Eckhardt, who believed successful trading was a skill that was a gift, while Dennis believed it anyone could be taught it.
Who Were The Turtles?
They were all from diverse backgrounds and the only thing they had in common was that they had never traded before. They included a boy fresh out school, a security guard, some professional card players, a bookkeeper and even an actor.
Dennis believed that anyone who wanted to be a successful trader needed to focus on three specific areas:
1. A simple technical system they could understand and have confidence in.
2. A set of money management rules to preserve equity.
3. A discipline to apply their methods through periods of losses without deviating from their system.
In the turtle trading experiment Dennis gave the turtles a simple system and taught them the RIGHT MINDSET to be successful.
A Simple system & money management rules
The system taught was simplicity itself and was designed to be easy to understand easy to apply, yet one the turtles could have complete confidence in. The system was based on breakout methodology, with just a few rules to confirm trading signals, backed up by strict money management rules to preserve equity.
If you want to learn forex trading, you need to understand that your system should be simple. One of the biggest myths of trading is that a complicated system is more likely to succeed than a simple one. In fact, most of the worlds top trading systems are simple and as a general rule, a robust simple system with just a few indicators will beat a more complicated one.
Why?
Because in the brutal world of trading, simple systems are more robust than complicated ones with less elements to break. In trading you don’t earn your reward from the effort you put in, you earn it for being right about market direction. With any system you need money management rules and Dennis gave them a simple set of rules that would preserve their equity. The knowledge Dennis gave his pupils gave them confidence which is crucial, in that it leads to discipline.
Discipline
If you are confident and understand a system you will follow it with discipline. Most traders don’t have discipline, because they don’t have ultimate confidence in their method, as soon as a string of losses occur they throw in the towel. If you don’t have the discipline to follow a method, you really have no method in the first place.
What can we learn from the turtles?
Quite simply, that anyone can learn to trade and trading success is within reach of anyone with a willingness to learn and apply what they have learned. You may not make as much money as the turtles, however if you focus on developing a robust method you understand, have confidence in and can apply with discipline, you can be a successful trader.
The turtles worked smart not hard to achieve trading success and their story is inspiring for anyone wishing to learn forex trading.
