Posted: 12 Jul 2010 11:09 PM PDT

Guest post from www.visionsofaffluence.com

So you want to be a trader? You buy all the books, hang out on the most popular forums, and try every technique and indicator you come across, but still you get no where. So, then you but even more books, spend more time o forums, and try even more techniques and indicators. And still none of it makes a difference and you can't figure out why. Well I'm here to tell you why. Quite frankly, you're the reason you can't trade successfully.

You see what most people fail to realize is that trading is about 90% mental and only 10% technique. That means that you can have the best system in the world, but if you don't have the right mindset then you'll never be successful. This is something that most traders never think about and consequently why so many of them are doomed to failure. It's unfortunate because trading itself is actually pretty simple. That's right contrary to popular belief trading easy. All you have to do is find a method that works (and there are plenty of them by the way) and implement it. But see therein lies the problem, we as humans have to implement them.

A lot of times people find trading methods, use them, fail to profit, and then come to the conclusion that the method doesn't work when a lot of times its not the method, but rather the implementation that causes the problem. We come along with our emotions like fear and greed and make a mess of things. We don't trade when we should or we trade when we shouldn't. We get greedy and hold trades too long or we take profit too soon. Or we make the biggest mistake of them all: we trade with position sizes that are too large for our account size. All of things and more add up to make trading difficult when it should be so simple. So, if you want to start actually making a profit from you trading then stop looking for the newest method or sexy indicator and start working on yourself.

If you want to discover what it takes to be able to trade for a living? Then visit visionsofaffluence.com

Forex Daily Outlook – July 13 2010

Posted: 12 Jul 2010 02:00 PM PDT

American and Canadian Trade Balance followed by German ZEW Economic Sentiment and UK’s CPI highlight today’s activities. Here is an outlook on the events at hand.

In the US, The trade deficit in the U.S. widened in April to $40.3 billion the highest in more than a year as exports and imports both declined. A drop to 39.4B is expected now.

More in the US, Federal Budget Balance expected to decrease deficit by 54.3B to -81.6B due to massive policy measures undertaken.

Finally in the US, IBD/TIPP Economic Optimism index predicted to rise to 47.9 points after an unexpected 46.2 point drop in May.

In Canada, Trade surplus expected to continue its growth to 0.4B from 0.2B in May.

For more on USD/CAD, read the Canadian dollar forecast.

In Europe, German ZEW Economic Sentiment Index could provide further evidence of an economic slowdown in the largest economy in the Euro-zone with a reading of 25.2 compared with 28.7 in the previous month. The ZEW index is poorly correlated to economic growth but is often seen as an important indicator of turning points in market sentiment.

More in Europe, French CPI expected to remain 0.1% and German Wholesale Price Index predicted to rise to 0.4% from 0.3% in May.

For more on the Euro, read the EUR/USD forecast and Casey Stubbs' latest analysis.

In Great Britain, Consumer Price Index, Inflation is expected to pull back to 3.2% y/y from 3.4% y/y in May, but still stubbornly remaining above the Bank of England's 3.0% ceiling as well as Core CPI expected to drop to 2.7% from 2.9% in May.

More in Great Britain, Dr Andrew Sentance an external member of the monetary policy committee of the bank of England speaks at the Thames Valley Chamber of Commerce, in Reading. His comments may determine a short-term positive or negative trend.

Later in Great Britain, Nationwide’s consumer confidence index fell to 65 points in May, the lowest reading since June last year, from an upwardly revised reading of 75 in April. A further drop to 64 points is expected now.

Finally in Great Britain, Department for Communities and Local Government House Price Index measuring change in the selling price of homes expected to rise to 10.3% – 0.2% more than in May. Retail Price Index predicted to drop to 4.9% from 5.1% and CB Leading Index is likely to remain 0.6%.

Read more about the Pound in the GBP/USD forecast.

In Switzerland, producer price index, which measures the change in price of goods and raw materials purchased by manufacturers, rose 0.3% during May despite economists’ expectations for a flat index. A small drop to 0.2% is expected now.

Australia’s NAB business confidence survey fell to a reading of 5 in May from 13 in April, with the decline attributed to global financial market instability and sharp declines in the AUD and equity prices. A further drop is expected now.

For more on the Aussie, read the AUD/USD forecast.

In New Zealand, Retail Sales, Following a three month disappointment, a Rise of 0.6% is now foreseen and Retail sales also predicted to gain 0.6% after 0.2% dip in the previous month.

In Japan, Revised Industrial Production a leading indicator of economic health expected to remain -0.1%. Household Confidence predicted to drop to 42.4 points, 0.4 points less than in the previous month.

That’s it for today. Happy forex trading!

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Breakout Strategy with Binary Options

Posted: 12 Jul 2010 07:07 AM PDT

Forex binary options can be useful in cases of breakouts, including false ones. Here’s a possible way to utilize them, with a recent example on EUR/USD.

I’ve already shown how to use binary options as an alternative to the traditional stop loss. In this case, I’m showing how to use them in the direction of the trend, and the best way is using an example:

EUR/USD began a rally after the Non-Farm Payrolls, about 10 days ago. It broke above 1.2460 and continued rallying. The next significant resistance line was seen at 1.2672, which was the peak in 6 weeks.

The pair gradually approached this line. The Euro didn’t have too many reasons of its own to rise, and it was merely enjoying the dollar’s weakness.

Nevertheless, it eventually climbed above 1.2672 and even reached 1.2722. This 50 pip break technically looks very convincing, but the fundamentals showed that a rise to higher levels wasn’t fully justified. Two attempts to assure the break failed.

Binary Options

A regular forex long position would have probably hit the stop loss, as the pair fell back and closed the week much lower. And here’s where binary options can be used. A trader that would see the breakout, could place a CALL option on EUR/USD. This means that he would make about 70% on his investment if the pair closed higher within one hour.

This tighter 1 hour frame is what makes the difference. In this limited time, the pair indeed continued higher. It didn’t make a long term rally, but this doesn’t matter in case one uses binary options.

Such cases of false breakouts that last a few hours are very common. It happens often in GBP/USD and in USD/JPY, and also others, and these options can be a great tool for taking advantage of these cases. With real breakouts, options can be utilized with other tools as well. With false ones, this seems the best option.

If you’re interested in binary options, you’re welcome to go to StartOptions. They’re a leading binary options provider. This is how it looks on their screens: