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The "great asset mania" is still partying up. As the saying goes, “Markets can remain irrational longer than you can remain solvent” – and they are certainly proving this point yet again. At times like these, your rational mind may be telling you, “Wait! This wild party is a trait of market tops” – but your instinct commands you to jump aboard.

That is exactly what many foreign exchange speculators did in 2004 and early 2005 when fear of holding U.S. dollars peaked. Ironically, and typically, that was the exact point when the dollar bottomed and those traders who went short the dollar because of its "weak fundamentals" and all the media hype got stuck with a losing position.

By contrast with late 2004-early 2005, there is presently little fear showing for the dollar's fate -- in the forex markets or the media. What does that tell you? Could we be at the opposite psychological extreme, with the dollar beginning an extended decline?

Perhaps. If you think, based on the current sentiment, that the dollar might be near a top, and your trading time frame is long-term, this could be the time to consider entering the market.

The forex market has many advantages for the beginning trader, notably: flexible size, high liquidity, low trading costs, a simpler set of choices (most trading is in only 9 currency pairs), and the ease with which you can trade currencies in both directions.

Another big plus for the beginner is the ability to start small, as some online brokerages have very low account minimums, and most offer trading games (paper trading) that can help you learn the mechanics of trading (But paper-trading won’t teach you the emotional lessons of trading real money, so beware.)

How does a beginner stand a chance against seasoned traders? The only way is by taking the time to build your background and fully understand the methodology and risks. And it helps to have an “edge,” like Elliott wave analysis, one of the best analytical tools for forex trading. The more participants in a market, the more clearly Elliott wave patterns show up in the charts, and forex is the largest market in the world, and growing fast.

It is not easy to make money by trading currencies. Industry executives say only about 10% to 15% of brokerage accounts are profitable. Margins of 100 to 1 or higher are common, which works both for and against you. That's why some successful traders say they often use much less leverage, such as 5 to 1. Even so, you can still lose… the Amaranth hedge fund suffered its losses trading at less than 5 to 1 margin.

If you are a beginner, start studying. Our Club EWI has plenty of free educational materials, including what is absolutely required reading – Robert Prechter’s classic traders' report, “What A Trader Really Needs to Be Successful.”

And if you are experienced forex speculator, our Currency Specialty Service's monthly, weekly, daily and intraday charts can help you zoom in on whatever time frame you want to trade within.

Get forecasts of the forex markets you follow. Our Currency Specialty Service is a professional-grade advisory tool previously reserved mostly for global forex pros. With it, you can build your own, flexible and affordable, currency package to suit your trading needs. Each package is a bargain and the more you choose, the less each one costs.

Click the Trading the Forex Market header link to learn more about the forex market and the forex buy sell signals services we provide. Most come with free trials so you can try before you buy.

Good day and good trading.

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