Before we begin looking at the specifics of the FPS and how it works, let’s look at4 building blocks that I believe to be foundations to the Forex Profit System.Foundation #1: Currency Trading is not a Get-Rich-Quick Scheme.Currency trading is a SKILL that takes TIME to learn. Skilled Traderscan and do make money in this field, however like any other occupation orcareer, success doesn’t just happen overnight. Here is a great ‘formula’for success:Practice + Patience + Persistence = ProfitsAs they say, there is no substitute for hard work and diligence. Practicetrading on a demo account and pretend the virtual money is your own realmoney. Do not open a live trading account until you are profitabletrading on a demo account. Stick to the plan and you can besuccessful.Foundation #2: I highly recommend that you follow 1 or maybe 2 major currency pairs.It gets far too complicated to keep tabs on all four. I also recommend thattraders choose one of the majors because the spread is the best and theyare the most liquid. The Euro/USD is the most commonly traded pair andusually has the best ‘spread’ because of its liquidity. The USD/Swiss Franc isusually the most volatile and moves the most during the trading week. TheUSD/Yen moves a lot on the news out of Japan and normally the PoundSterling/USD is more stable in it’s moves than the other three.Foundation #3: Follow and understand the daily Forex News and Analysis of theprofessional currency analysts.Even though this system is based solely on technical analysis of charts, it isimportant to get a birds-eye view of the currency markets and the news thataffects the prices. It is also important that you know and understand what thekey technical ‘support’ and ‘resistance’ levels are in the currency pair that youwant to trade. Support is a predicted level to buy (where currency pair shouldmove up on the charts), resistance is a predicted level to sell (where thecurrency pair should move down on the charts).Fortunately, all the best Forex news and analysis is offered free on theInternet. Here is what you should do first:*While you are reading the daily news and technical analysis, writedown on a piece of paper what direction the analysts are sayingabout the major currency pair you are following and the key supportand resistance levels for the day.A. Go to http://www.forexnews.com/ and you will find 24hr news and analysis onthe spot FX markets. The site will give you the big picture of how theeconomic calendar and central banks affect the currency markets. Agreat resource.B. Then go to http://www.fxstreet.com/ and click on the ‘Top Forex Reports’. Herethere is a wonderful listing of all the major daily currency analysis andforecasts with support and resistance and direction forecasts.C. Click on http://www.currencypro.com/ and go to ‘Today’s Market Research’ andthere you will find more excellent analysis on the Major Currency pairs.Another great Forex Portal.Foundation #4: Learn how to use the technical indicators in this course andalways trade with stop losses!It is worth your time to be patient and learn how to use the technicalindicators on the charts that you will be reading about shortly.6 It is important when you are trading Forex, to be disciplined and to stick toa plan. Don’t just trade your ‘gut’ feeling. Use the technical indicatorsoutlined and always enter in stop losses on every trade. Remember thateveryone who trades has a different tolerance for losses. Depending onyour risk capital, and strategy, set your stop losses accordingly
