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Learning forex trading should not be difficult. With decent understanding of money management rules and a good trading strategy, you should be ready for conquering the forex markets.

Always try to understand the big picture. You should start each trading session by looking at the daily charts and than zooming into 4hr, 1hr, 30min, 15 min etc charts. Forex trading is all about interpreting the past as well as about interpreting the future.

You need to know whether the market is ranging or trending before each trade. You should try to know any long term patterns that have developed by looking at the charts. By taking a general look at the different charts you will develop a feel of how the forex markets are behaving in the short as well as the long term.

You should try to figure out the general direction of the currency markets. You can use candlestick analysis and moving averages to identify long term patterns and reversals.

Bollinger bands applied to 4hr charts can be used to identify the daily trading range. Most of the price action is expected to be within the Bollinger bands. Any moves outside the bands can be viewed as short term abnormalities and ignored.

Do some scenario planning, once you have a general overview of the market. Make sure you know what news is scheduled to be released and what is the expected market reaction.

Understanding the big picture does not mean knowing the whole picture. You should only focus on your favorite pairs. It takes a longtime and effort to understand a currencys behavior, how it reacts to things like oil prices, interest rates etc. So concentrate only on a few pairs in forex trading.

You should always try to take notes and keep a daily trading journal. Start each entry in the trading journal by analyzing the general direction of the markets for that day. What you think how the markets are going to react to different news that is expected to be released that day? What should be your entry and exit for the trade. How many pips you are expecting to make?

After each trade, look at what went wrong and how to avoid it in future trading! In case of a good trade that made you pips, analyze how many pips you could have made more and how to tweak your trading strategy for better results in the future trades.

Keeping these general tips in mind while you are learning forex trading will help you a lot. Never ever trade without stop losses and practice on the demo account for at least three months before starting live trading.

Unlike stock markets, forex markets are open 24/5 except on the weekends. There is a continuous price action all day in the currency markets. Do you know this fact more than 90% of forex traders are speculators?

Forex markets usually react violently to the release of economic and socio political news. Currency rates can either shoot up or down violently for a few minutes to a few hours before the jittery traders absorbs the impact of the news.

Fundamental economic news like NFP figures, the housing sales number, FOMC meeting etc all are released at a known time. Google Fundamental News and you will see lots of sites that provide this information.

You can get the day and time when a major economic announcement is going to be made. Non Form Payroll (NFP) figures have become very significant for USD pairs especially after the start of the recession recently.

Non Farm Payroll (NFP) figures are released regularly at 8:30 AM EST on the first Friday of every month. EUR/USD and other USD pairs become very jittery just before the release of these figures. EUR/USD can sometimes shoot up by 50-150 pips in 5-10 minutes just after the release of these figures.

Markets mostly stabilize within a few hours after the release of these figures unless these figures are of such a fundamental nature to form a new trend in the market.

Forex news release trading is best for those traders who like a lot of action within few minutes. Here is one strategy described in short that you can use.

Enter both buy and sell orders on for example EUR/USD at 10 pips above and below the price of EUR/USD just five minutes before the announcement of NFP figures.

Put stop loss of 10 pips and take profit of 40 pips on both orders. Immediately on the announcement of NFP figures, EUR/USD will react violently and either shoot up or down.

Suppose EUR/USD goes up by 10 pips, buy order will be triggered. Suppose it jumps by 60 pips. Your position will be closed at 50 pips when you have taken profit of 40 pips. Isnt it cool you made 40 pips in just a few minutes?

If EUR/USD goes down by 10 pips, the sell order will be triggered and you will still make 40 pips. However, sometimes the markets have a tendency to whipsaw. Practice this on your demo account first and make ten successful trades before going live.

Fundamental traders depend on fundamental analysis in trading forex. Technical traders depend on technical analysis in trading forex. But the importance of economic data cannot be underestimated in shaping trading strategies.

US Dollar is the most important currency in the global economy. More than 90% of currency trades are done in US Dollar. In most of the currency trades, US Dollar is either the base currency or the counter currency.

For success in forex trading, choice of the right currency pair to trade is very important. US Dollar is the most important currency and most probably you will be also trading US Dollar as a forex trader most of the time. You should know that the release of certain economic data has significant and lasting impact on US Dollar.

You should know as a forex trader that currency markets reaction to the release of different economic data with time also changes. Some years back, US GDP figures used to be important for US Dollar but dont have much impact in recent years.

EUR/USD is the most liquid pair in the forex market and is heavily traded. The release of Nonfarm Payrolls (NFP) data on the first Friday of each month has become important in recent years. These figures makes EUR/USD and other pairs involving US Dollar highly volatile for some time until the markets digest the importance of these figures.

Some years back, the release of US housing sales number figure every month was not significant for the currency markets. But these figures have become very significant for US Dollar in the recent years especially after the US housing market crash. Forex markets used to give more weight to US Trade Balance figures in the past but they dont react to these figures much now.

If you are a range trader who likes to scalp for a few pips every trade, you should avoid trading on the day NFP data is released. Release of NFP figures makes the markets jittery and highly volatile.

However, as a breakout trader, understanding of which economic data is expected to be released can help you in your trading. You should plan your trades in accordance with the importance of the economic data to be released.

In brief, knowledge that certain economic indicators make the forex markets move most is important for you as a trader. It is also important for you to know that particular economic data, the market considers most important at any point in time.

You should also understand which economic data causes knee jerk reaction in the currency markets and which pieces of economic data will have lasting reaction in the currency markets.