Hi F
Forex is more difficult, you have to deal with two currencies and the sentiment can change easily from one session to the other and often in the same session, any fart can also have an influence, as you know the big money is made in the bigger swing.......but I only trade forex and probably I do not know much.
Hi Fugazsy - I've always heard that Forex is incredibly difficult and very risky. But as the rate between the two currencies is driven by the entirety of two whole national economies, that might explain why they're much less unpredictable than say an index driven by just 30 companies from 4 or 5 sectors of one economy, let alone a share price driven by the activities of just one single company.
Forex trends can easily persist for months / years once established. They don't bounce around in massive daily % changes like the Dow etc.
I think the real risky reputation of Forex arises from the failure of new Forex retail traders to adapt to the tiny tiny numbering system of the rates. Its a big step in scale and thinking to go from trading the Dow at 17000pts to an exchange rate at 1.0001.
I notice also it seems a characteristic of US traders and market commentators (who must outnumber everyone else?) to be very attached to the actual price of stocks in $, rather than the change in price - so they do talk about e.g. $50 stocks, as if these are different to a £5 stock or a EUR10 stock - really its the % price change from $50 0r £5 or EUR10 that makes the profit or loss. $50 stocks are good to be long on, they would suggest. When they move into Forex, would it be a surprise if they misinterpreted the relative values and bullish properties of USD/JPY (124.00, big number, must be bullish, right?) versus EUR/USD (1.0900, a tiny number, about to go below 1, must be rubbish, yeah?).
Might be letting my prejudices show. And I don't have a scrap of evidence either. But I can reliably say that 82.78% of all statistics are made up on the spur of the moment by a middle-aged guy with a beard.
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