The (Foreign Exchange) Forex Trading Market Explained.

Defining Trading Trend and Ranges in Forex Trading

When you choose to start trading in the Forex market, which is often call the foreign exchange market, you will need to bone up on a little trading vocabulary.  Learning specific terms and what they mean are essential before you even think about using real money to trade.  You would never get into a pilot’s seat and try to fly a plane without ever having taken flying lessons.  The same goes for foreign exchange market trading.  You need to be fully aware of what you are doing.  This is a market that is not quickly learned, so you should never assume that once you jump into it, you will learn as you go.  While some people opt to do that, they typically end up losing an adequate sum of money because they were not as prepared as they should have been.  Knowing the importance of trading trends and ranges in Forex trading is very important.  If you are thinking of trading in the Forex market, be sure you know what these terms mean and their implications. 

Trading Trend

When price moves consistently in one direction in the Forex, a trend occurs.  When the direction is higher, the trend is often called bullish.  When the direction of the price is moving lower, the trend is often called bearish.  These terms are relative of course.  When you define a trend, you should always remember that price peaks and troughs are in the same direction.  When you are dealing with a bearish trend, remember that price highs and lows are moving lower.  Likewise when you are dealing with a bullish trend, they are moving higher. 

Often when trends occur, it is possible to draw support lines under one that is moving higher (an uptrend).  You can also often draw resistant lines above one that is moving lower (a downtrend).  Once you see these lines break, it can be assumed that the trend is complete.  At this point there is a possibility that the trend will begin to reverse.  When it does reverse, you will need to know the pattern of what that entails. 

Trend Reversal

When you hear of a trend reversal, it simply means that the direction of market prices is changing.  Often you will see trend reversals following a four step pattern.  Usually, this includes the market making a new high, the trend line being broken, the market making an intermediate low, and a new rally that does not match the first high.  Many times you will see prices break the previous low however.  You may come across terms such as Double, Triple Tops, and Bottoms, which are all trend reversal patterns.  Head and shoulders patterns are also popular reversal patterns. 

Trading Range

The trading range is actually a sideways chart pattern. It is often used to represent a resting period before the original trend is resumed.  You may see these when you are charting trends and should know what they imply.

Often trends are very important to investors.  Those who engage in trend-following are people who look at major trends and make decisions in the direction of the trend.  This can be a good strategy, but you must know a great deal about trends and the market in general in order to use this technique successfully.  Beginners are not usually very good at tracking trends and using trend-following techniques.  One thing that you should also note is that some price movements are trendless.  This means that they have no clear direction, which makes trend-following nearly impossible. 

Remember, that in order to fully understand trends, you must be educated in the ways of the market and foreign exchange in general.  Beginners should not rely heavily on foreign exchange market trend tracking.  Once you get more experience you can begin looking into tracking more and more.  However, be aware that different things affect and influence the Forex.  These influences can change what people expect trends to be.  Therefore, you should be a seasoned trader in order to rely on the trends and ranges alone.  Educate yourself on these terms and learn to recognize them in the actual market.  After all, learning the terms is one thing and being able to see them in reality is different.


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Introduction to Online Forex Trading
Current Forex Currency Rates
Forex Trading
How to Get Started In FOREX Trading
FOREX versus Futures Market
FOREX versus Stocks
FOREX Trading Philosophy
Fundamental Analysis In Forex Trading
Forex Technical Analysis - Part 1
Forex Technical Analysis - Part 2
FOREX Trading Strategies
Trading Currencies on Margin
Currency Option Marketplace
FOREX Signals
How to Read FOREX Quotes
Calculating FOREX Profits and Losses
Risks of FOREX Trading
FOREX Training
FOREX Trading Software
FOREX Brokers
FOREX Glossary
Forex Updates and Training
Crash Course in Forex Education
How to Recognize Patterns in Forex Trading Markets
Defining Exotic Currencies and Their Impact on Forex Markets
Defining Trading Trend and Ranges in Forex Trading
Mind Games – The Psychology of Forex Market Trading
Crossing Currency - What’s This Mean to Forex Traders
Money Management Basics for Forex Traders
Choosing Your Forex Broker
Expensive Beginner Forex Trader Mistakes
The Elliott Wave Theory for Forex Markets
Failsafe Facts to Guarantee Failure in Forex Trading
Five No Nonsense Strategies in Forex Trading
Global Expansion and It’s Reaches within the Forex Market
Hedging in the Forex Market
The Important Ways to Keep From Losing in the Forex Markets
An Overview of the Euro’s Performance in the Forex Markets
Six Trading Tips for the Forex Newbie
The Lowdown on Day Trading
Interpreting How Interest Rates Drive the Foreign Exchange Markets
The Basics of the Bollinger Band Technical Indicator in Forex Markets
Relative Strength Analysis in Forex Trading
The Basics on Understanding Forex Options
Forex Charts – What Are They and How Do You Read Them
Interpreting the Future of the Oil Marketplace and How It Affects Forex Trading
Top Five Economic Indicators that Drive Forex Trading
Rules for Trading in Forex Markets
How Does the Japanese Yen Stack Up Against the US Dollar in Forex Markets
Pivot Points in Forex
The Ins and Outs of Trying Out a Forex Demo Account
The Top Currencies to Watch in the Forex Trading Game
Defining Moments Regarding Trading Trends and Ranges with Forex
Top Ten Basic Terms in Forex Trading and Their Definitions
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Five Economic Driving Forces that Influence Forex Trading
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