Uptrend on the market The market broke the zone before and it retraced back in the zone now it's gaining momentum going up...the is possibility it will reach 1.35300
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The Midyear Mindset Reset: Reboot Your Trading Before Q3Because nothing says "trader growth" like admitting you’ve been winging it for six months.
👋 Welcome to Halftime — How’s Your P&L Looking?
June’s closing bell isn’t just a date on the calendar — it’s that awkward moment where traders stare into the middle distance, coffee in hand, and quietly whisper: “Well… that went differently than I expected.”
Whether you’ve been racking up wins, nursing drawdowns, or simply surviving market whiplash, midyear is nature’s way of handing you a clean slate. Before Q3 throws its inevitable curveballs, now’s your chance to pause, reset, and actually look at what the heck you’ve been doing. And, of course, prepare for the next batch of earnings reports .
Spoiler: if your trading strategy this year has involved equal parts hope and caffeine, you’re not alone.
🔥 The Year So Far: Markets Kept It… Interesting
Let’s quickly recap 2025 so far (because trauma processing is healthy).
The Magnificent Seven? More like the Magnificent Two-And-A-Half. Meta NASDAQ:META and Microsoft NASDAQ:MSFT ran victory laps while everyone else tripped over AI headlines or regulatory landmines.
Nvidia NASDAQ:NVDA moonwalked into trillion-dollar territory, then stumbled after export bans — but somehow still has every fund manager whispering “Blackwell” like it’s a secret password.
Bitcoin BITSTAMP:BTCUSD set new highs north of $110K (who needs fiat when you can have memes?).
The Fed teased cuts, inflation teased persistence, and Trump teased… well, everyone.
And summer trading arrived with its usual low-volume traps, giving us breakouts that break hearts and liquidity that disappears faster than your broker’s customer support.
In short: volatility? Check. Opportunity? Absolutely. Discipline? That depends on whether you’re still following your rules or trading on vibes.
By June, most traders have crafted elaborate narratives in their heads. You know the type: "This breakout is different," "The Fed has to cut next month," and "There’s no way Nvidia can keep running like this."
The problem is, markets don’t care about your narrative. They care about price, volume, sentiment — and sometimes, absolute chaos. That beautifully clean chart setup? It’s not asking for your prediction. It’s begging you to respond with discipline, not bravado.
The traders who thrived in the first half didn’t win by forecasting every twist in the macro plotline. They won by following the tape. The breakout happened? They took it. The stop-loss hit? They respected it. That’s not luck — that’s execution.
🫶🏻 Emotional Capital: The Real Balance You Should Be Watching
P&L tells one story. Emotional capital tells another.
By June, a lot of traders aren’t out of money — they’re out of discipline. They’ve been revenge trading after a string of losses, chasing AI headlines that already ran, and convincing themselves they can “make it all back” on the next oversized position.
Do you know that feeling?
Resetting your trading mindset at midyear means recalibrating that emotional bankroll. Start by reviewing your trading journal (yes, you’re supposed to have one ). Revisit the trades that made sense and the ones that make you cringe. Recognize your patterns — your strengths, but also your weaknesses. Success leaves clues and there are lessons in failures.
💭 Clean Up the Clutter
There’s a special type of fatigue that sets in after six months of consuming too much trading content. You start layering on indicators like toppings at a frozen yogurt bar — RSI, MACD, Stochastics, VWAP, Fibonacci, Elliott Waves, Gann fans... until your charts light up like the billboards in Times Square.
The truth is, the best traders heading into Q3 are simplifying. They’re not chasing complexity; they’re chasing clarity. They know their setups, they trust their process, and they wait for clean signals.
Summer trading especially demands this discipline. Liquidity gets thinner, breakouts fail more often , and the tape gets choppy.
Complex systems may amplify the noise. Strip it down. Focus on price structure. Simplify your strategy so you can execute when real opportunities appear — not when your 12th oscillator blinks green.
⚾ You Don’t Need a Home Run
At this stage of the year, many traders fall into what we’ll call the desperate hero phase. They feel behind. They want to make up for drawdowns. They want “the trade” that fixes everything. If you’ve missed making bank over the first half of the year, chances are, you want to catch up — and fast.
Here’s a secret: The best traders aren’t always looking for grand slams. They’re playing small ball too — consistent singles, tight risk, controlled losses, steady gains.
Q3 isn’t about doubling your account. It’s about staying alive long enough for your edge to show up and play out. The traders who make it to year-end consistently profitable aren’t the ones chasing massive wins. They’re the ones compounding quiet, boring, disciplined trades.
Midyear Reset: Your Q3 Trading Checklist
Here’s your brutally simple plan for the back half:
✅ Journal your biggest mistakes from H1
✅ Cut your watchlist in half
✅ Size smaller than feels exciting
✅ Trust clean setups over crowded trades
✅ Stay curious — but stay selective
✅ Leave the FOMO trades to the TikTok influencers
So the real question heading into Q3 isn’t whether markets will go up or down. It’s whether you will trade better or keep winging it.
Happy midyear reset. Trade smarter, not harder.
#AN008: Israel, Iran and the price of fear
GEOPOLITICS – Israel, Iran and the price of fear
While the stock markets are trying to hold up, the geopolitical reality is very different. In the last 72 hours, Israel has hit a facility considered strategic in southern Iran. Tehran responded with ballistic warheads targeted at NATO positions, and threatened a military closure of the Strait of Hormuz. In a few hours, Brent has shot above $100, while WTI has touched $94.20, bringing back to life a spectre that seemed archived: energy purchases.
DOLLAR AND FED – Sickles under pressure
The Federal Reserve has kept rates unchanged, but Powell has sent a clear signal: "there will be no cut if the geopolitical context continues to generate upward pressure on prices".
In other words: the FED remains hawkish, the dollar continues to dominate, and global sentiment shifts to risk.
CROSS WATCH – SwipeUP FX Opportunity
EUR/USD
Weak EU macro + sustained US sell-off + war → Realistic target 1.0630 – if it breaks 1.0675 H8.
USD/JPY
Institutionals undecided: if the yen does not strengthen and the BOJ remains neutral, we can return above 158. Target: 158.60-159.2 in case of new USD leg.
CAD/JPY and oil-linked
Canada benefits from the oil increase, but be careful: risk-off can penalize. Assess only with cyclical confirmation and real volumes.
📌 WHAT TO WATCH NOW – SwipeUP Checklist
📆 Friday, June 21: US PMI data + Powell speech
⚠️ VIX above 20: signals real tension
📉 JPY and CHF in divergence? → watch out for manipulative breakouts
🗓️ Earnings Season: can divert flows in the short term, but remains in the background
What Is T-Distribution in Trading? What Is T-Distribution in Trading?
In the financial markets, understanding T-distribution in probability is a valuable skill. This statistical concept, crucial for small sample sizes, offers insights into market trends and risks. By grasping T-distribution, traders gain a powerful tool for evaluating strategies, risks, and portfolios. Let's delve into what T-distribution is and how it's effectively used in the realm of trading.
Understanding T-Distribution
The T-distribution in probability distribution plays a crucial role in trading, especially in situations where sample sizes are small. William Sealy Gosset first introduced it under the pseudonym "Student". This distribution resembles the normal distribution with its bell-shaped curve but has thicker tails, meaning it predicts more outcomes in the extreme ends than a normal distribution would.
A key element of T-distribution is the concept of 'degrees of freedom', which essentially refers to the number of values in a calculation that are free to vary. It's usually the sample size minus one.
The degrees of freedom affect the shape of the T-distribution; with fewer degrees of freedom, the distribution has heavier tails. As the degrees of freedom increase, the distribution starts to resemble the normal distribution more closely. This is particularly significant in trading when dealing with small data sets, where the T-distribution provides a more accurate estimation of probability and risk than the normal distribution.
T-Distribution vs Normal Distribution
T-distribution and normal distribution are foundational in statistical analysis, yet they serve different purposes. While both exhibit a bell-shaped curve, the T-distribution has thicker tails, implying a higher probability of extreme values. This makes it more suitable for small sample sizes or when the standard deviation is unknown.
In contrast, the normal distribution, with its thinner tails, is ideal for larger sample sets where the standard deviation is known. Traders often use T-distribution for more accurate analysis in small-scale or uncertain data scenarios, while normal distribution is preferred for larger, more stable datasets, where extreme outcomes are less likely.
Application in Trading
In trading, T-distribution is a valuable tool for analysing financial data. It is primarily used in constructing confidence intervals and conducting hypothesis testing, which are essential for making informed trading decisions.
For instance, a trader might use T-distribution to test the effectiveness of a new trading strategy. Suppose a trader has developed a strategy using the technical analysis tools and wants to understand its potential effectiveness compared to the general market performance. They would collect a sample of returns from this strategy over a period, say, 30 days. Given the small sample size, using T-distribution is appropriate here.
The trader would then calculate the mean return of this sample and use T-distribution to create a confidence interval. This interval would provide a range within which the true mean return of the strategy is likely to lie, with a certain level of confidence. If this confidence interval shows a higher mean return than the market average, the trader might conclude that the strategy is potentially effective. However, it's important to note that this is an estimation and not a guarantee of future performance.
How to Plug Probability and Normal Distribution in Your T-Calculation
To use a T-calculator for integrating probability and normal distribution, follow these steps:
- Input Degrees of Freedom: For T-distribution, calculate the degrees of freedom (sample size minus one).
- Convert Z-Score to T-Value: If using normal distribution data, convert the Z-score (standard deviation units from the mean in a normal distribution) to a T-value using the formula: T = Z * (sqrt(n)), where 'n' is the sample size.
- Enter T-Value: Input this T-value into the calculator.
- Calculate Probability: The calculator will then output the probability, providing a statistical basis for trading decisions based on the T-distribution.
Limitations and Considerations of T-Distribution
While T-distribution is a powerful tool in trading analysis, it's important to recognise its limitations and considerations:
- Sample Size Sensitivity: T-distribution is most effective with small sample sizes. As the sample size increases, it converges to a normal distribution, reducing its distinct utility.
- Assumption of Normality: T-distribution assumes that the underlying data is approximately normally distributed. This may not hold true for all financial data sets, especially those with significant skewness or kurtosis.
- Degrees of Freedom Complications: Misestimating degrees of freedom can lead to inaccurate results. It's crucial to calculate this correctly based on the sample data.
- Outlier Sensitivity: T-distribution can be overly sensitive to outliers in the data, which can skew results.
Advanced Applications of T-Distribution in Trading
T-distribution extends beyond basic trading applications, playing a role in advanced financial analyses:
- Risk Modelling: Utilised in constructing sophisticated risk models, helping traders assess the probability of extreme losses.
- Algorithmic Trading: Integral in developing complex algorithms.
- Portfolio Optimisation: Assists in optimising portfolios by estimating returns and risks of various assets.
- Market Research: Used in advanced market research methodologies to analyse small sample behavioural studies.
The Bottom Line
The T-distribution is a powerful tool, offering nuanced insights in scenarios involving small sample sizes or uncertain standard deviations. Its ability to accommodate real-world data's quirks makes it invaluable for various trading applications, from strategy testing to risk assessment. However, understanding its limitations and proper application is crucial for accurate analysis.
This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.
How to Trade the Commitment of Traders Report Part 1Hey Traders so today I wanted to start a 3 part series on how to use the Commitment of Traders report to help you in your trading.
Enjoy!
Hope This Helps Your Trading 😃
Clifford
Best Free Volatility Indicator on TradingView for Gold Forex
This free technical indicator will help you easily measure the market volatility on Forex, Gold or any other market.
It will show you when the market is quiet , when it's active and when it's dangerous .
We will go through the settings of this indicator, and you will learn how to set it up on TradingView.
Historical Volatility Indicator
This technical indicator is called Historical Volatility.
It is absolutely free and available on TradingView, MetaTrader 4/5 and other popular trading terminals.
TradingView Setup
Let me show you how to find it on TradingView and add it to your price chart.
Open a technical price chart on TradingView and open the "Indicators" menu (you will find it at the top of the screen).
Search "Historical Volatility" and click on it.
It will automatically appear on your chart.
"Length" parameter will define how many candles the indicator will take for measuring the average volatility. (I recommend keeping the default number, but if you need longer/shorter-term volatility, you can play with that)
Timeframe drop-down list defines what time frame the indicator takes for measuring the volatility. (I recommend choosing a daily timeframe)
And keep the checkboxes unchanged .
How to Use the Indicator
Now, let me show you how to use it properly.
Wider the indicator and analyse its movement at least for the last 4 months.
Find the volatility range - its low levels will be based on the lower boundary of the range, high levels will be based on its upper boundary.
This is an example of such a range on USDCAD pair.
When the volatility stays within the range, it is your safe time to trade.
When volatility approaches its lows, it may indicate that the market might be slow .
Highs of the range imply that the market is very active
In-between will mean a healthy market.
The Extremes
The violation of a volatility range to the downside is the signal that the market is very slow . This would be the recommended period to not trade because of high chance of occurrence of fakeouts.
An upward breakout of a voliatlity range is the signal of the extreme volatility . It will signify that the market is unstable , and it will be better to let it calm down before placing any trade.
Volatility Analysis
That is how a complete volatility analysis should look.
At the moment, volatility reached extreme levels on CADJPY pair.
The best strategy will be to wait till it returns within the range.
Remember This
With the current geopolitical uncertainty and trade wars, market volatility reaches the extreme levels.
Such a volatility is very dangerous , especially for newbie traders.
Historical volatility technical indicator will help you to easily spot the best period for trading and the moment when it is better to stay away.
❤️Please, support my work with like, thank you!❤️
I am part of Trade Nation's Influencer program and receive a monthly fee for using their TradingView charts in my analysis.
How Bitcoin can impact alt coins like sol and sui This video is a very quick update on the potential for bitcoin to drop into the 96/97k region and the effect it will have on alt coins .
If you hold altcoins and you see them bleed in price then its important to know and understand whats ahead for Bitcoin .
Understanding this will help you with your entry's and your exits on all altcoins .
Your Liquidation can be Exchanges Business & Profit Ever feel like the market is designed to move against you ?
That your stop-loss is a magnet for price action?
What if it’s not just in your head? Behind every liquidation wave lies a structure and maybe even a strategy.
In this post, we dive deep into how exchanges might be benefiting from your losses and most importantly, how to flip the script in your favor.
Hello✌
Spend 3 minutes ⏰ reading this educational material.
🎯 Analytical Insight on XRP:
XRP is approaching a major daily support zone, aligned with the psychological level of $2.00. This area has historically provided strong buying interest. A potential rebound from this level could lead to a minimum upside of 16%, with a medium-term target around $2.50 . 📈
Now , let's dive into the educational section,
💣 Liquidation as a Business Model
In crypto derivatives markets, liquidation isn’t just a risk it’s a revenue stream. When your position gets liquidated, your funds don’t just vanish into thin air they become someone else’s gain. Often, the exchange itself.
Remember, exchanges control:
Price data
Order book matching
Access to retail trading behavior
That means they can anticipate and even design market conditions that favor liquidations . Especially from retail traders who overleverage or place their stops in obvious spots.
Scary? Maybe.
Avoidable? Absolutely.
📊 Why TradingView Is Where Your Survival Starts
When it comes to defending yourself against liquidity traps, your best weapon is data real data. Not gut feelings, not Telegram signals. TradingView offers a range of tools that help you detect the footprints of large players before they run over your position. Here’s how to use them:
Liquidity Zones: These zones highlight areas where most stop-losses cluster perfect for identifying where big players are likely to push price. Use community indicators like “Liquidity Grab Zones” or manually plot key levels.
Volume Profile: Shows you exactly where the highest traded volumes occurred. These “high interest” areas often become magnets for price and are favorite playgrounds for liquidity raids.
Order Blocks: Smart money often enters the market through order blocks. Tools like “SMC Tools” or custom scripts in TradingView help you mark these institutional footprints.
Open Interest & Funding Rates (via external data plugins): Watch for spikes in funding or sudden OI drops these can be early signs of liquidation sweeps.
Replay Tool: Rewind the market to any date and simulate price movement in real time. An amazing way to train your eyes on how liquidity hunts usually play out.
Bottom line? TradingView isn’t just a charting tool it’s your radar system in a market full of traps. But only if you use it the right way.
🧠 Market Psychology: Your Fear Is Their Fuel
Exchanges and the whales who partner with them thrive on predictable retail emotion:
Fear of missing out (FOMO)
Fear of liquidation
Greed for fast gains
They don’t need to fake anything your emotions are enough. They just need to let the herd run into the slaughterhouse. Your best defense? Awareness, logic, and a data-first mindset.
⚠️ How to Avoid Becoming Their Target
Stop following noise; start tracking smart data.
Never use stop-losses at obvious round levels or under candle wicks these are classic sweep zones.
Watch funding rates if it looks too bullish or bearish, get cautious.
Don’t enter trades when you feel too confident that’s often when traps are most effective.
Aim for higher-timeframe setups and avoid scalping in manipulated zones.
Most importantly: Treat every chart as a trap until proven otherwise.
🧭 Final Take
In crypto, knowledge isn’t power it’s protection. If you’re still hoping the market plays fair, it’s time to change perspective. Use TradingView to out-think and outlast the systems designed to exploit you. You don’t have to be a genius just informed.
✨ Need a little love!
We put so much love and time into bringing you useful content & your support truly keeps us going. don’t be shy—drop a comment below. We’d love to hear from you! 💛
Big thanks ,
Mad Whale 🐋
📜Please remember to do your own research before making any investment decisions. Also, don’t forget to check the disclaimer at the bottom of each post for more details.
CME FedWatch : the essential tool to consult before the FedThe CME FedWatch Tool is a free and widely used resource offered by CME Group. It has become a key reference in the financial industry for tracking, in real time, market expectations about upcoming interest rate decisions by the U.S. Federal Reserve (Fed). Frequently cited in financial media, this tool allows traders and analysts to assess the likelihood of a rate hike, hold, or cut ahead of each scheduled FOMC meeting.
How does it work?
At the core of the FedWatch Tool lies data derived from 30-day Fed Funds Futures, which reflect the average federal funds rate expected for a given month. These contracts follow a simple rule:
Implied Rate = 100 – Futures Price
So if a futures contract trades at 95.67, the implied average rate is 4.33%. This is then compared not just to the Fed’s current target range (4.25% to 4.50%), but more specifically to the Effective Federal Funds Rate (currently around 4.33%) to estimate the market-implied probability of a rate hike, hold, or cut.
The FedWatch Tool then distributes these probabilities across expected scenarios for each upcoming meeting, allowing users to see, for instance, a 99.9% probability of a hold or a 0.1% chance of a cut. This makes it a real-time barometer of monetary policy expectations.
The Historical section: analyze and backtest
Beyond the live probabilities, the tool also features a Historical section. This shows how rate expectations evolved ahead of past FOMC meetings and what the Fed ultimately decided.
Users can download this data for further study, enabling a better understanding of how market sentiment shifted over time, particularly in reaction to speeches, inflation data, or jobs reports. This is especially valuable for those looking to backtest trading or hedging strategies tied to rate decisions.
The “Dot Plot”: insight into the Fed’s own outlook
Another key feature of the tool is the Dot Plot, which displays individual FOMC participants’ rate projections over time. Each dot represents a member’s view of where the fed funds rate should be by the end of a given year.
The Dot Plot is only updated four times per year, in March, June, September, and December, during the Fed’s so-called “summary of economic projections” meetings. These quarterly meetings are particularly market-sensitive because they are accompanied by updated economic forecasts and a press conference. While the dots do not reflect a formal voting commitment, they offer valuable insight into the Fed’s collective sentiment and long-term bias.
How to Interpret the Data?
A key takeaway for traders: don’t confuse the direction of interest rates with the overall message. A rate cut may not be “dovish” if paired with cautious language or projections. Conversely, holding rates steady may be interpreted as “hawkish” if the market was expecting a cut.
What really moves markets is the difference between expectations and what the Fed actually says or does. That includes the language of the statement, any changes in the dot plot, and Chair Powell’s comments in the post-decision press conference. These factors often matter more than the rate move itself.
The situation on Wednesday, June 18, 2025: what to expect?
The June 18 meeting is one of the quarterly meetings, meaning it will come with a press conference and a release of a new dot plot. As of now, the FedWatch Tool shows an extremely high probability (99.9%) of a rate hold within the current 4.25% to 4.50% range.
However, what matters most on this occasion is the guidance for the second half of the year. As of now:
The market assigns a 56% probability to a first rate cut by September,
A 41% chance to two cumulative 25 bp cuts (down to 3.75–4.00%) and a 21% chance of a more aggressive easing path (3.50–3.75%) by December.
This means the market still expects some policy easing later in the year, but not aggressively. If Powell opens the door more clearly to cuts, or if the new dot plot shows a downward shift in the median rate projection for 2025, the dollar could weaken and rate-sensitive assets might rally. On the other hand, if the Fed maintains a cautious stance and the dots remain unchanged, markets may interpret that as hawkish.
This is why knowing what the market has already priced in before the announcement is essential: the reaction depends not on the raw decision, but on how it compares to expectations.
In short…
For all these reasons, I believe the FedWatch Tool is a simple yet extremely powerful resource for anyone interested in U.S. monetary policy. It allows users to track market expectations and compare them with official Fed communications. It’s definitely a key part of my trading arsenal.
To go deeper, other tools can complement this analysis—especially implied volatility data from rate options markets. These don’t signal directional bias, but rather how large a move the market expects. That will be the focus of an upcoming article.
The Fundamental Truths About a Trending MarketBefore you can trade successfully, you must first understand what defines a market trend.
🔼 What is an Uptrend?
An uptrend is characterised by a series of Higher Highs (HH) and Higher Lows (HL). This signals that buyers are in control and price is climbing steadily.
🔽 What is a Downtrend?
A downtrend is identified by a series of Lower Lows (LL) and Lower Highs (LH). This indicates that sellers are dominant and price is consistently falling.
📌 Important Facts About a Trending Market
Trends don’t change easily. Once a trend is established, it tends to persist.
A trend reversal takes time and effort. It doesn't happen abruptly — the market needs a strong reason to change direction.
There are always warning signs. Before a trend changes, there’s usually a pattern or shift in behaviour that acts as a clue.
The bigger the trend, the longer it takes to reverse. A well-established trend will require more time and evidence before it breaks.
🎯 Keys to Trading Any Market Successfully
Identify the market condition.
Is the market trending upwards, downwards, or moving sideways (consolidating)?
Study price behaviour at key levels.
Understand how price reacts at significant highs and lows.
Learn the anatomy of price waves.
Recognise wave structure — how price expands and contracts in trends.
Align your trades with the market condition.
Your entry and exit strategies should fit the current phase of the market.
🔚 Summary
Mastering trends is one of the most important skills in trading. When you understand what defines an uptrend or downtrend, recognise when a trend may be ending, and align your strategy with the market condition, you set yourself up for consistent success. Patience, observation, and timing are key — because the market always leaves clues, but only for those who are prepared to see them.
Short overview of monetary policyIt's a busy week for central bank monetary policies with the BoJ, FED, BoE and SNB all due this week.
Current probabilities are as follows:
Federal Reserve - 98.8% Hold @ 4.5%
Bank of England - 88.3% Hold @ 4.25%
Swiss National Bank - 100% Cut from 0.25% to 0.00%
The FED will also be realising their economic projections and forward guidance including the updated dot plot, so market attention will be drawn towards this and accompanying press conference.
As always, the BoE will be releasing their MPC votes so focus will shift towards these and comments made in policy summary.
Both the FED and BoE may struggle to make a more dovish tilt with sticky inflation and uncertainty around geopolitical tensions and tariff negations.
If any comments come for a more hawkish stance such as a higher revision for inflation or reduction in future rate cuts will promote and stronger USD and pairs such as USDCAD or USDCHF (whilst keeping safe haven plays in mind) could provide some good moves.
Any surprise dovish comments likely hold a bigger potential for stronger initial moves in USD weakness. For this potential US equity upside such as the S&P or NASDAQ could provide good opportunity.
Trading the VIX – Part 2Trading the VIX – Part 2: VIX ETPs and Strategic Applications
In Part 1 of this series, we explored the structure of VIX Futures, focusing on the roll-down effect in a contango VIX futures curve—common in calm market conditions.
In Part 2, we turn our attention to VIX-related Exchange-Traded Products (ETPs)—specifically, the popular and liquid:
• VXX – unleveraged long VIX ETP
• UVXY – leveraged long VIX ETP
• SVXY – inverse VIX ETP
Each of these products is based on a specific VIX futures strategy, the “S&P500 VIX Short Term Futures Index” , which is maintained by S&P, Dow Jones (the “SPDJ-Index”). The Fact Sheet and Methodology can be obtained from the S&P Global website.
What is the SPDJ Index that these ETPs track?
The SPDJ-Index is a strategy index that maintains a rolling long position in the first- and second-month VIX futures to maintain a constant 30-day weighted average maturity.
Key Features of the SPDJ Index:
• Starts with 100% exposure to VX1 (the front-month future) when it’s 30 days from expiration.
• Gradually it rolls from VX1 to VX2 (next-month future) each day to maintain a 30-day average expiration.
• At all times, the index is long either one or both VX1 and VX2, with exposure shifting daily from VX1 to VX2.
• This roll mechanism causes value erosion in contango (normal markets) and gains in backwardation (during volatility spikes).
• Since contango is the dominant market state, the index loses value over time—with occasional short-lived gains during sharp volatility increases.
Importantly, the SPDJ Index does not represent the VIX or any other volatility level, it simply reflects the value of this futures-based rolling strategy.
________________________________________
Breakdown of the ETPs: VXX, UVXY, and SVXY
VXX – Long SPDJ Index (1x)
• Tracks the SPDJ Index directly
• Suffers from the roll-down drag in contango environments.
• Useful only for short-term exposure during expected volatility spikes.
• Timing for long positions is critical
UVXY – Leveraged Long (Currently +1.5x)
• Replicates a strategy that maintains a constant leverage of 1.5 to the SPDJ Index.
• Formerly +2x leverage; reduced in April 2024.
• Highly sensitive to VIX moves; underperforms long term due to both roll-down drag and leverage decay (see below). Timing for long positions is even more important than for the VXX.
SVXY – Inverse (-0.5x)
• Replicates a strategy that maintains a constant exposure of -0.5 to the SPDJ Index.
• Benefits from falling VIX levels as well as from contango in the front part of the VIX futures curve.
• Formerly -1x before the Feb 2018 volatility spike triggered massive losses (XIV, a competing ETP, collapsed at that time).
• Performs well in calm conditions but is vulnerable to sharp volatility spikes.
Leveraged & Inverse ETPs – Important Notes affecting the UVXY and SVXY (without going into details):
• Daily resetting for the replicating strategies to maintain constant exposure factors (different from 1x) are pro-cyclical and can cause compounding errors, specifically in turbulent markets (e.g. Feb 2018).
• The real volatility of the VIX futures itself acts as a drag on returns, independent of the index’s direction.
• Risk management is essential—especially with inverse products like SVXY.
All three of these ETPs track a VIX futures strategy, they are not levered or unlevered versions of the original VIX index. Each of these ETPs benefits from liquid option markets, enhancing the toolkit for volatility trading.
Trading Strategies Using VIX ETPs
Here are several practical approaches to trading these products:
VXX and UVXY
• Best used for short-term trades aiming to capture volatility spikes.
• Options strategies such as zero-cost collars, vertical and calendar spreads can help mitigate the challenge of precise timing.
• Avoid long-term holds due to erosion from roll-down and leverage decay (see historical performance!).
SVXY – The Carry Trade Proxy
• Ideal for profiting from prolonged calm periods and the contango structure.
• Acts like a carry trade, offering a positive drift—but must be paired with robust stop-loss rules or exit strategy to guard against sharp spikes in volatility.
Switching Strategies
• Tactically rotate in/out of SVXY based on short-term volatility indicators.
• One common signal: VIX9D crossing above or below VIX, i.e. long SVXY if VIX9D crosses under VIX, staying long while VIX9D < VIX, closing long SVXY position when VIX9D crosses over VIX. Some traders also use crossovers with VIX3M or the individual expirations of the VIX futures curve to manage entries.
• Switching between SVXY and VXX based on crossover triggers through the VIX futures curve is often advertised, but very hard to get working in practice due to the importance of timing the VXX entry and exit – signals from the VIX curve may not signal VXX entries and exits timely enough.
Term Structure-Based Combinations
• Combine short VXX with long VXZ (an ETP tracking longer-dated VIX futures, balancing the 4th to 7th VIX contracts to achieve a constant expiration of 60days).
• Weighting is determined by the Implied Volatility Term Structure (IVTS), calculated as VIX / VIX3M. This approach adjusts positions based on the shape of the VIX futures curve, indicated by the IVTS. For instance, when the VIX futures curve shifts from contango (where near-term futures are cheaper than longer-term ones) to backwardation (where near-term futures are more expensive), it involves reducing short positions in VXX and increasing long positions in VXZ.
• This approach mimics the spirit of a calendar spread strategy in VIX futures and reflects the “S&P 500 Dynamic VIX Futures Index” , with weightings backed by research from Donninger (2011) and Sinclair (2013) - see performance chart and weighting-matrix enclosed in the introductory chart).
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VIX Curves as Market Indicators
Beyond trading, VIX instruments and their term structure are widely used as market sentiment gauges. For instance:
Signs of Market Calm:
• VIX9D < VIX
• VIX < VIX3M
• VIX < VX1
• VX1 < VX2
These relationships imply that short-term volatility is lower than longer-term expectations, indicating near-term calmness in markets, occasionally leading to market complacency.
Traders and institutions use these signals to:
• Adjust positioning in broad market indices
• Determine hedging requirements
• Evaluate suitability of selling naked options
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Final Thoughts
VIX ETPs offer a powerful toolkit for traders seeking to profit from or hedge against volatility. But they come with structural decay, leverage dynamics, and curve risk. Timing, strategy, and risk control are key.
How to Find Day Trading Momentum Plays...In this video I show the screener I use in order to find my momentum day trading setup. If you have any questions feel free to ask. Hope you enjoy!!
Turn Your Chart – Turn Your ViewCurious about tricking your trading mind?
A lot of traders are constantly searching for new indicators or secret setups. But what if your biggest breakthrough is just a perspective shift away—literally?
This article is about a unique but effective experiment: Rotate your candlestick chart by 90 degrees (horizontal instead of vertical) and see how your perception and analysis change.
Example: ibb.co
No, this isn’t a volume profile – this is the real NAS100 chart, just rotated by 90°!
What do you see now? New patterns? Different price action? Sometimes a fresh angle reveals details you normally overlook and helps break your trading habits.
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What changes?
1. Patterns suddenly look different
Trends, consolidations, and breakouts appear in a new light:
– Uptrends and downtrends lose their emotional “up feels hard, down feels easy” effect.
– Sideways markets become vertical clusters—your eye spots new structures.
2. Support & resistance become less dominant
Your classic support and resistance zones disappear.
You’re forced to rethink important levels—maybe you’ll notice supply/demand zones you always missed.
3. Emotional neutrality
With a rotated chart, the usually existing “Long is better” bias fades.
You view price action more objectively—and may discover signals you’d otherwise miss.
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Try it out!
What did you discover by rotating your chart? Comment below or share your thoughts!
What do we need to know before investing?If you are thinking about investing money for the potential returns it offers, you should know that it may go well, but that there are always risks. That’s why we are going to give you some basic tips to bear in mind before making any investment decision.
How much money are you going to invest?
First of all, you need to decide how much money you want to put towards your financial investments.
The markets are subject to change
The financial markets are constantly fluctuating. The term volatility is the most commonused term to describe and measure the uncertainty provided by changes to theprices of financial assets.
Additionally, there are times in the market when the prices are more pronounced and every now and then there are crisis periods and asset prices fall dramatically.
Investing in financial markets means that we have to assume that our investments will always be subject to these types of fluctuations. If you are going to invest in the financial markets the money that you invest must be money that you will not need during the investment term.
That’s why, investing in order to obtain short term gains is inevitably associated with high risk. Furthermore, the larger our intended gains, the larger the associated risk. Always bear in mind that the greater the expected returns, the greater the assumed risk. Once again, be sure that you do not need the money that you are going to invest, as it may have losses.
The opposite can be said of long term investments, where the capacity to wait and overcome falls in the market means that you can assume more risk with your investments. With a long term vision you will avoid having to experience any possible losses with your investment period due to any eventual liquidity needs.
How much risk are you willing to take on?
Before investing it is important to know the risk you can assume. Every investor has their own risk tolerance level that they need to be aware of. Risks and returns go hand in hand, because for more returns you also need to take on more risk, and vice versa.
It is also good to know that just as with normal market conditions, those assets with a higher risk tend to suffer more fluctuations with their prices than those assets with less risk.
Therefore, in general terms:
When the forecasts for the financial markets are favourable and the market goes up, those assets with higher expected returns generally perform excellently.
Whenever the financial markets are going through uncertain times, those assets with higher expected returns, and therefore more risk, tend to perform worse.
You must start from a strong financial position
To invest you need to be at a point where your accounts are well under control, including your debts. We do not mean to say that if you have any outstanding credit you cannot invest, but it is essential that everything is in order and that you are in a situation where you can fulfil your financial obligations.
On the other hand, to build long term wealth, it is important that you assign part of your income to your savings, meaning that you have to invest with the money left over after making your payments while also saving part of what you earn.
It is important to keep a composed outlook
Now we know that investing bears its own risks and that the market is subject to change, it is essential to be composed when investing. When investing it is important to think positively, as if you don’t really believe that things will work out, why invest?
It is one thing to be cautious, and to know how much money to invest and what level of risk tolerance to assume, and another to think negatively each time there is a drop in the market. In reality, investing is a combination of caution and composure.
Diversification is the key to success
Somebody with less investment experience may make the mistake of putting all of their investment budget into just one thing. However, it is much better to have diverse investments, as while some investments may not quite work out as you would have liked them to, some do even better.
Losses are normal, and so are returns
We previously said that when investing it is important to stay calm, and that is true. In this regard, you also have to bear in mind that it is normal for some investments in your portfolio to not perform as well as you had expected.
We cannot predict the behaviour of the financial markets or of certain assets. We can also unexpectedly find ourselves with some assets that don’t perform as well as we had hoped. That is why we recommend, in addition to not risking more than you can invest, to diversify your investments well.
We have already said that investment involves risk, which is why it is good to know that if you are willing to invest, you are also willing to take on risks. If you are prepared to take on this risk, you can be successful in your investments.
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by HollyMontt
What is Dollar Cost Averaging (DCA)?🔵 What is Dollar Cost Averaging (DCA)?
Dollar Cost Averaging (DCA) is a timeless investment strategy that involves investing a fixed amount of money at regular intervals, regardless of the asset's price. It’s one of the most effective ways to build a position over time while minimizing the impact of market volatility.
The term "Dollar Cost Averaging" was popularized in the early 20th century by Benjamin Graham — the father of value investing and mentor to Warren Buffett. Graham advocated DCA as a way to remove emotions and guesswork from investing. By spreading out purchases, investors could avoid mistiming the market and reduce risk exposure.
Today, DCA remains a core strategy for retail investors, especially in volatile markets like cryptocurrencies and growth stocks.
🔵 How Does DCA Work?
The concept is simple: instead of investing a lump sum all at once, you break your total investment into smaller, equal parts and invest them over time — for example, weekly or monthly.
Invest $100 every week into Bitcoin.
Keep buying consistently — regardless of whether price goes up or down.
Over time, this smooths out your average entry price.
You buy more when price is low, and less when price is high.
Example:
If BTC is at $30,000 one month, you buy a small amount.
If BTC drops to $25,000 the next month, you buy more units with the same $100.
Over time, your entry price averages out — reducing the risk of buying at a peak.
🔵 Why Use DCA?
DCA offers both psychological and mathematical advantages:
Reduces timing risk: You don’t need to predict market tops or bottoms.
Builds discipline: Encourages consistent investing habits.
Prevents emotional mistakes: Avoids FOMO buying and panic selling.
Smooths volatility: Especially useful in crypto or fast-moving assets.
🔵 Smart DCA: Buying Into Market Bottoms
While classic DCA is powerful on its own, it becomes even more effective when combined with market structure. A popular approach is to only DCA when the asset is trading below its long-term average — such as the 200-day Simple Moving Average (SMA) or using RSI (Relative Strength Index).
What is the 200-day SMA?
It’s the average closing price over the last 200 days — a key indicator of long-term trend direction.
Why DCA Below the 200 SMA?
Historically, many market bottoms occur below the 200 SMA. Using this as a filter helps you avoid accumulating during overvalued or overheated conditions.
SDCA with RSI
The Relative Strength Index (RSI) helps identify momentum exhaustion. When RSI drops below 30, it often marks deeply oversold conditions — especially on the daily chart for BTC.
How to use it:
Only DCA when price is below the 200-day SMA.
You accumulate during crashes, fear, and corrections.
Avoid buying when price is extended far above long-term value.
🔵 Scaling DCA Based on Undervaluation
To further optimize the strategy, you can scale your DCA amounts depending on how far below the 200 SMA the price is.
Example:
Price is 5% below 200 SMA → invest normal amount.
Price is 15% below → double your investment.
Price is 25% below → triple your investment.
This creates a dynamic DCA system that responds to market conditions — helping you build larger positions when prices are truly discounted.
🔵 When DCA Doesn’t Work
Like any strategy, DCA has limitations. It’s not magic — just a system to reduce timing errors.
In strong uptrends, a lump sum investment can outperform DCA.
In declining assets with no recovery (bad fundamentals), DCA becomes risky.
DCA works best on quality assets with long-term growth potential.
Always combine DCA with research and risk management — don’t blindly accumulate assets just because they’re down.
🔵 Final Thoughts
Dollar Cost Averaging isn’t about buying the exact bottom — it’s about consistency , discipline , and risk control . Whether you’re investing in Bitcoin, stocks, or ETFs, DCA offers a stress-free approach to enter the market and smooth out volatility over time.
Smart traders take it one step further: using moving averages and structure to focus their DCA efforts where value is highest.
DCA won’t make you rich overnight — but it will help you sleep at night.
This article is for educational purposes only and is not financial advice. Always do your own research and invest responsibly.
About the chart that shows a sideways movement...
Hello, traders.
If you "follow", you can always get new information quickly.
Have a nice day today.
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When you study charts, you will realize how difficult it is to move sideways.
Therefore, depending on how long the sideways movement was before the big wave, the size of the wave is also predicted.
However, in the charts showing sideways movement, the price range and wave size are often known after the wave appears.
This shows that the location of the sideways movement and the size of the sideways wave are important.
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Looking at the chart above, we can say that it is showing a sideways movement.
However, since the price is located at the lowest price range, it is better to exclude this chart.
The reason is that if it is showing a sideways movement at the lowest price range, it is likely that the trading volume has decreased significantly due to being excluded from the market.
This is because it is likely to take a long time to turn into an upward trend in this state.
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Looking at the chart above, the price is showing a sideways movement while maintaining a certain interval after rising.
The sideways movement is about 31%, so it may be ambiguous to say that it is actually sideways.
However, if the price moves sideways while maintaining a certain interval after rising, it means that someone is trying to maintain the price.
Therefore, when it shows a movement that breaks through the sideways section, it should be considered that there is a possibility that a large wave will occur.
The wave can be either upward or downward.
Therefore, it is necessary to be careful not to jump into a purchase with the idea that it will definitely rise in the future just because it moves sideways.
A box section is set at both ends of the sideways section.
Therefore, it is recommended to proceed with a purchase in installments when it shows support after entering this box section.
In other words, it is important to check the support in the 1.5-1.9669 section or the 25641-2.6013 section.
You can see that the HA-Low indicator and the HA-High indicator are converging.
Therefore, if this convergence is broken, it is expected that a trend will be formed.
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Like this, you should measure the price position of the sideways movement and the width of the sideways movement well and think in advance about whether to proceed with the transaction when it deviates from that range.
Otherwise, if you start trading after the wave has already started, you may end up giving up the transaction because you cannot overcome the wave.
Since it is not known when the movement will start once the sideways movement starts, individual investors easily get tired.
Therefore, when the coin (token) you want to trade shows a sideways movement, it is recommended to increase the number of coins (tokens) corresponding to the profit while conducting short-term trading (day trading).
If you do this, you will naturally be able to see how the sideways waves change, and you will be able to hold out until a big wave starts.
I think there are quite a few people who are not familiar with day trading and say they will buy at once when the wave starts.
If you can hold out well against the wave, you will get good results, but there is a possibility that the trade will fail 7-8 times out of 10, so if possible, it is good to get used to the feeling by day trading coins (tokens) that show this sideways pattern.
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Thank you for reading to the end.
I hope you have a successful trade.
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Soybeans and Heat: Subtle Signals in a Volatile Market1. Introduction
Soybeans aren't just a staple in livestock feed and global cuisine—they’re also a major commodity in futures markets, commanding serious attention from hedgers and speculators alike. With growing demand from China, unpredictable yields in South America, and increasing climatic instability, the behavior of soybean prices often reflects a deeper interplay of supply chain stress and environmental variability.
Among the many weather variables, temperature remains one of the most closely watched. It’s no secret that extreme heat can harm crops. But what’s less obvious is this: Does high temperature truly move the soybean market in measurable ways?
As we’ll explore, the answer is yes—but with a twist. Our deep dive into decades of data reveals a story of statistical significance, but not dramatic deviation. In other words, the signal is there, but you need to know where—and how—to look.
2. Soybeans and Climate Sensitivity
The soybean plant’s sensitivity to heat is well documented. During its flowering and pod-setting stages, typically mid-to-late summer in the U.S., soybean yields are highly vulnerable to weather fluctuations. Excessive heat during these windows—particularly above 30ºC (86ºF)—can impair pod development, lower seed count, and accelerate moisture loss from the soil.
The optimal range for soybean development tends to hover between 20ºC to 30ºC (68ºF to 86ºF). Within this window, the plant thrives—assuming adequate rainfall and no pest infestations. Go beyond it for long enough, and physiological stress builds up. This is precisely the kind of risk that traders price into futures markets, often preemptively based on forecasts.
Yet, trader psychology is just as important as crop biology. Weather alerts—especially heatwaves—often drive speculative trading. The market may anticipate stress well before actual yield reports come out. This behavior is where we see the beginnings of correlation between temperature and market movement.
3. Quantifying Weather Impact on Soybean Futures
To test how meaningful these heat-driven narratives are, we categorized weekly temperatures into three buckets:
Low: Below the 25th percentile of weekly temperature readings
Normal: Between the 25th and 75th percentile
High: Above the 75th percentile
We then calculated weekly returns of Soybean Futures (ZS) across these categories. The results?
Despite the modest visual differences in distribution, the statistical analysis revealed a clear pattern: Returns during high-temperature weeks were significantly different from those during low-temperature weeks, with a p-value of 3.7e-11.
This means the likelihood of such a difference occurring by chance is effectively zero. But here’s the catch—the difference in mean return was present, yes, but not huge. And visually, the boxplots showed overlapping quartiles. This disconnect between statistical and visual clarity is exactly what makes this insight subtle, yet valuable.
4. What the Data Really Tells Us
At first glance, the boxplots comparing soybean futures returns across temperature categories don’t scream “market-moving force.” The medians of weekly returns during Low, Normal, and High temperature periods are closely clustered. The interquartile ranges (IQRs) overlap significantly. Outliers are present in every category.
So why the statistical significance?
It’s a matter of consistency across time. The soybean market doesn’t suddenly explode every time it gets hot—but across hundreds of data points, there’s a slightly more favorable distribution of returns during hotter weeks. It’s not dramatic, but it’s reliable enough to warrant strategic awareness.
This is where experienced traders can sharpen their edge. If you’re already using technical analysis, seasonal patterns, or supply-demand forecasts, this weather-based nuance can serve as a quiet confirmation or subtle filter.
5. Why This Still Matters for Traders
In markets like soybeans, where prices can respond to multiple fundamental factors—currency shifts, export numbers, oilseed competition—small weather patterns might seem like background noise. But when viewed statistically, these small effects can become the grain of edge that separates average positioning from smart exposure.
For example:
Volatility tends to rise during high-heat weeks, even when average return shifts are small.
Institutional players may rebalance positions based on crop health assumptions before USDA reports arrive.
Weather trading algos can push prices slightly more aggressively during risk-prone periods.
In short, traders don’t need weather to predict price. But by knowing what weather has historically meant, they can adjust sizing, bias, or timing with greater precision.
6. Contract Specs: Standard vs. Micro Soybeans
Accessing the soybean futures market doesn’t have to require big institutional capital. With the launch of Micro Soybean Futures (MZS), traders can participate at a more granular scale.
Here are the current CME Group specs:
📌 Contract Specs for Soybean Futures (ZS):
Symbol: ZS
Contract size: 5,000 bushels
Tick size: 1/4 of one cent (0.0025) per bushel = $12.50
Initial margin: ~$2,100 (varies by broker and volatility)
📌 Micro Soybean Futures (MZS):
Symbol: MZS
Contract size: 500 bushels
Tick size: 0.0050 per bushel = $2.50
Initial margin: ~$210
The micro-sized contract allows traders to scale into positions, especially when exploring signals like weather impact. It also enables more nuanced strategies—such as partial hedges or volatility exposure—without the capital intensity of full-size contracts.
7. Conclusion: A Nuanced Edge for Weather-Aware Traders
When it comes to soybeans and temperature, the story isn’t one of obvious crashes or dramatic spikes. It’s a story of consistent, statistically measurable edges that can quietly inform better trading behavior.
Yes, the return differences may look small on a chart. But over time, in leveraged markets with seasonality and fundamental noise, even a few extra basis points in your favor—combined with smarter sizing and timing—can shift your performance curve meaningfully.
Using tools like Micro Soybean Futures, and being aware of technical frameworks, traders can efficiently adapt to subtle but reliable signals like temperature-based volatility.
And remember: this article is just one piece in a multi-part series exploring the intersection of weather and agricultural trading. The next piece might just provide the missing link to complete your edge. Stay tuned. 🌾📈
When charting futures, the data provided could be delayed. Traders working with the ticker symbols discussed in this idea may prefer to use CME Group real-time data plan on TradingView: www.tradingview.com - This consideration is particularly important for shorter-term traders, whereas it may be less critical for those focused on longer-term trading strategies.
General Disclaimer:
The trade ideas presented herein are solely for illustrative purposes forming a part of a case study intended to demonstrate key principles in risk management within the context of the specific market scenarios discussed. These ideas are not to be interpreted as investment recommendations or financial advice. They do not endorse or promote any specific trading strategies, financial products, or services. The information provided is based on data believed to be reliable; however, its accuracy or completeness cannot be guaranteed. Trading in financial markets involves risks, including the potential loss of principal. Each individual should conduct their own research and consult with professional financial advisors before making any investment decisions. The author or publisher of this content bears no responsibility for any actions taken based on the information provided or for any resultant financial or other losses.
Wedge Pattern – Simple Explanation
📚 Wedge Pattern – Simple Explanation
A wedge pattern is a shape on the chart that looks like a triangle or cone. It tells us that the price is getting ready to break out — either up or down.
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🔻 Falling Wedge (Bullish)
Looks like price is going down, but slowly.
Lines move closer together.
Usually means the price will go up soon.
It's a bullish signal (good for buying).
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🔺 Rising Wedge (Bearish)
Price goes up, but losing strength.
Lines get closer together.
Usually means the price will go down soon.
It's a bearish signal (good for selling).
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💡 Easy Tips:
Wait for breakout (big move out of the wedge).
Use a stop-loss below/above the pattern.
Target = height of the wedge.
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📌 In Short:
Wedge = Squeeze pattern.
Falling wedge = Buy chance.
Rising wedge = Sell chance.
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Let me know if you have sny doubt in comments
Trading at the Market OpenTrading at the Market Open
The market open marks a critical juncture in the financial world, presenting a unique blend of opportunities and challenges for traders. This article explores the essence of trading at the open across stocks, forex, and commodities. It delves into the heightened volatility and liquidity characteristic of this period, offering insights and strategies to navigate these early market hours effectively, setting the stage for trading opportunities.
What Does the Open Mean in Stocks, Forex, and Commodities?
The open signifies the start of the trading day for various financial markets. It's a time when trading activity surges, marked by a rush of orders that have accumulated since the previous close. In stock markets, this includes shares, indices, and Exchange-Traded Funds (ETFs). The influx of orders often leads to significant price movements as the market absorbs overnight news and global economic developments.
For forex and commodity markets, the open can vary by region, reflecting their 24-hour nature. This period is crucial for setting the tone of the trading day, offering insights into sentiment and potential trends. Traders closely watch the market open to gauge the strength of these movements, which can indicate broader market trends or sector-specific shifts.
Volatility and Liquidity at Market Open
Trading at the open is often marked by enhanced volatility and liquidity. Heightened volatility is primarily due to the influx of orders accumulated overnight, reacting to various global events and news. As traders and investors assimilate this information, rapid price movements are common, especially in the first few minutes of the session. These price fluctuations can present both opportunities and risks for traders.
Increased liquidity, which refers to the ease with which assets can be bought or sold without causing significant price movements, is also a characteristic of the open. A higher number of market participants during this period may result in better order execution and tighter bid-ask spreads, particularly in highly liquid markets like forex and major stock indices.
What to Know Before the Market Opens
In terms of things to know before the stock market opens, it's essential to review the overnight and early morning news that can affect stocks. This includes company earnings reports, economic data releases, and geopolitical events. Traders also check pre-market trading activity to gauge sentiment and potential opening price movements.
For forex and commodities, understanding global events is crucial. Developments in different time zones, like policy changes by central banks or shifts in political scenarios, can significantly impact these markets. Additionally, reviewing the performance of international markets can provide insights, as they often influence the US open.
It's also vital to analyse futures markets, as they can indicate how stock indices might open. Lastly, around the forex, commodity, and stock market openings, indicators and other technical analysis tools applied to the previous day can also offer valuable context for the day ahead.
Market Open in Different Time Zones
Market open times vary globally due to different time zones, significantly impacting trading strategies. For instance, the New York Stock Exchange (NYSE) opens at 9:30 AM Eastern Time, which corresponds to different times in other parts of the world. For traders in London, this translates to an afternoon session, while for those in Asian markets like Tokyo, it's late evening.
Forex, operating 24 hours a day during weekdays, see overlapping sessions across different regions. For example, when the Asian trading session is concluding, the European session begins and later overlaps with the North American session. Such global interconnectivity ensures that forex markets are active round the clock, offering continuous trading opportunities but also requiring traders to be mindful of time zone differences and their impact on liquidity and volatility.
Strategies for Trading at Market Open
Trading at market open requires strategies that can handle rapid price movements across all markets. Here are some effective approaches:
- Pay Attention to Pre-Market Trends: This helps traders assess how a stock might behave at the market open. If a stock is fading from post-market highs, it might be wise to wait for a trend change before entering.
- Gap and Go Strategy: This involves focusing on stocks that gap up on positive news at market open, an indicator of potential further bullishness. Traders look for high relative volume in pre-market and enter trades on a break of pre-market highs. This strategy is fast-paced and requires quick decision-making.
- Opening Range Breakout (ORB): The ORB strategy uses the early trading range (high and low) to set entry points for breakout trades across all types of assets. The breakout from this range, typically the first 30 to 60 minutes of the session, often indicates the price direction for the rest of the session. Time frames like 5-minute, 15-minute, and 30-minute are commonly used for ORB.
- Gap Reversal: The gap reversal method is used when the price creates a gap, but then the range breaks in the opposite direction. If the gap is bullish and the price breaks the lower level of the opening range, it signals a gap reversal. The same concept applies to bearish gaps but in reverse.
The Bottom Line
In essence, understanding unique features of market open trading is vital for those participating in stock, forex, and commodity markets. The opening moments are characterised by heightened volatility and liquidity, driven by global events and sentiment. However, savvy traders may capitalise on these early market dynamics with effective strategies.
This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.
Top 5 Most Effective Forex Trading StrategiesTop 5 Most Effective Forex Trading Strategies Used by Professional Traders
Forex trading requires not just knowledge, but discipline and a clear strategy. So what are the most effective forex trading strategies that professional traders consistently use to achieve sustainable profits?
Let’s explore the 5 most trusted strategies that have stood the test of time – helping you level up your skills and reduce risk in this trillion-dollar market.
1. Breakout Strategy – Catching the Wave When the Market Explodes
A breakout occurs when price moves beyond a key support or resistance level after a period of consolidation. This usually signals the start of a new trend.
Best for: Traders who love strong momentum.
Pro tip: Confirm breakout with volume or candlestick patterns (e.g., engulfing).
Caution: Avoid entering right after the breakout – wait for a retest.
2. Trend Following Strategy – Trade with the Market, Not Against It
“Trend is your friend” – one of the most famous sayings in trading. This strategy helps traders ride the main trend, buying in uptrends and selling in downtrends.
Recommended tools: MA 20, MA 50, RSI, MACD.
Insider tip: Combine with pullback entries (enter when price retraces to dynamic support/resistance).
3. Price Action Strategy – Reading the Market Without Indicators
Price Action focuses on interpreting pure price behavior, without relying on indicators. Many pro traders prefer this approach to understand market psychology in real time.
Advantages: Clean, flexible, sharpens decision-making.
Popular candlestick patterns: Pin Bar, Inside Bar, Fakey, Engulfing.
4. News Trading Strategy – For Quick Thinkers and Fast Hands
When major news events like CPI, NFP, FOMC, or rate decisions hit the market, volatility surges. This creates both high-profit opportunities and high risks.
Common tactic: Straddle – place Buy Stop & Sell Stop before news release.
Risk warning: Watch out for slippage and widened spreads.
5. Fibonacci & Confluence Strategy – High-Probability Entries
This strategy combines tools like Fibonacci retracement, trendlines, support/resistance zones, and moving averages to find high-probability entry points.
Strength: Optimizes Risk: Reward ratio.
Tip: Focus on Fib levels 0.382 – 0.618 (commonly used retracement zones).
Conclusion: The Best Strategy is the One That Matches Your Style
There’s no perfect strategy – but understanding and applying the one that best fits your trading style will help you avoid emotional decisions and build long-term consistency.
Remember: Risk management – Emotional control – Systematic discipline = Long-term trading survival.
Bitcoin Or Gold? Real Safe Haven In Middle East tension When the world shakes, where does money go— Bitcoin or gold ?
You may think crypto is the ultimate safe haven… but data tells a different story.
This breakdown compares digital dreams vs. physical trust —with charts, tools, and the psychology behind every move.
Hello✌
Spend 3 minutes ⏰ reading this educational material.
🎯 Analytical Insight on Bitcoin:
Contrary to common expectations, Bitcoin has shown relative resilience amid recent geopolitical tensions, refraining from a sharp sell-off.
This price behavior signals a potential shift in market psychology—something I’ll explore further in an upcoming educational post.
Based on my previous analyses, I continue to anticipate an upward breakout above the $110K resistance zone in the current structure.
Now , let's dive into the educational section,
📌 Gold: The Legacy of Trust
For thousands of years, gold has been the go-to safe asset. In wars, inflation, sanctions, and crashes—it remains the mental anchor of value. Tangible, historic, and out of government control.
🪙 Bitcoin: Revolutionary but Unstable
Bitcoin promises freedom, decentralization, and anti-inflation. But during actual crises, trust wavers. High volatility, regulatory risk, and lack of a long history make investors hesitate when fear hits hard.
🛠️ TradingView Tools That Reveal Where Smart Money Flows
One reason TradingView stands out is its wide set of tools that help you track market psychology—not just price action. When it comes to analyzing the Bitcoin-vs-Gold battle during global crises (like the Iran-Israel war), these tools are essential:
Correlation Coefficient: This shows how closely BTC and gold move together. In panic moments, it helps reveal where the real trust is flowing.
On-Balance Volume (OBV): Key for spotting where big money is headed. If OBV on gold rises while BTC’s falls, smart money isn’t betting on crypto just yet.
Fear & Greed Index Logic (DIY): While not a native TradingView tool, you can mimic it by combining volatility and volume indicators to reflect market emotion.
Overlay XAUUSD and BTCUSD: Place both on a single chart with “percentage scale” enabled. You’ll see exactly which one holds up better during chaos.
Marking Geo-Political Events: Tag key events (like missile strikes or sanctions) on your charts. Track how Bitcoin and gold react immediately after.
📊 How Investors React in Crisis
During events like an Iran-Israel war, data shows money often flows into gold—not BTC. When panic peaks, people run toward the “known,” not the “new.”
🧠 The Illusion of Crypto as Safe Haven
We want to believe BTC is the new gold. But the human mind—under threat—defaults to ancient instincts. Fear doesn’t innovate. It runs to what it knows: shiny, physical, historical gold.
💡 When Will Bitcoin Truly Compete?
When the next generation fully embraces digital assets. When institutions store BTC alongside gold. When BTC no longer crashes on scary headlines—that’s when the shift becomes real.
⚠️ Lessons from War
Wars reveal that markets don’t behave rationally in fear. Even if Bitcoin makes sense on paper, emotion drives flows. Right now, that flow still favors gold.
🔍 What to Watch Next
If, during a future conflict, Bitcoin drops less—or even rises while gold does—you may be witnessing a turning point. Until then, keep tracking both with your TradingView setups.
🧭 Final Takeaway
Gold still owns the trust game in a crisis. Bitcoin is on its way but hasn’t crossed that psychological line. If you’re a smart trader, know how to read both—and move before the herd does.
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📜Please remember to do your own research before making any investment decisions. Also, don’t forget to check the disclaimer at the bottom of each post for more details.
The "True Close" Institutions Don't Talk About — But Trade On█ My Story from the Inside
I worked at a hedge fund in Europe, where I served as a Risk Advisor. One thing I never expected before joining the institutional side of the market was this:
They didn’t treat the current day’s close as the "true" close of the market.
Instead, they looked at the first hour of the next day — once all pending flows had settled, rebalancing was done, and execution dust had cleared — that was the true close in their eyes.
Here’s why that changed everything I knew about trading:
█ Institutional Reality vs Retail Fantasy
⚪ Retail traders are taught:
“The daily close is the most important price of the day.” But institutions operate under constraints that most retail traders are never exposed to:
Orders too large to fill before the bell
Internal compliance and execution delays
Batch algorithms and VWAP/TWAP systems that extend into the next session
So while the market might close on paper at 17:30 CET, the real trading — the stuff that matters to funds — might not wrap up until 09:30 or 10:00 the next morning.
Although the official “close” prints here, institutional volume ends quickly. It drops off sharply, almost immediately. Once the books are closed and final prints are done, big players exit — and what's left is thin, passive flow or noise.
The first hour of the New York session reveals structured flows, not random volatility. This is where institutions finalize yesterday’s unfinished business, which is why many consider this the “true” close.
And that’s the price risk managers, portfolio managers, and execution teams internally treat as the reference point.
█ Example: The Rebalance Spillover
Let’s say a fund needs to offload €100 million worth of tech stocks before month-end. They start into the close, but liquidity is thin. Slippage mounts. They pause execution. Next morning, their algo resumes — quietly but aggressively — in the first 30 minutes of trade.
You see a sharp spike. Then a reversal. Then another surge.
That’s not noise. That’s structure. It’s the result of unfinished business from yesterday.
█ Why the First Hour is a War Zone
You’ve probably seen it:
Prices whip back and forth at the open
Yesterday’s key levels are revisited, sometimes violently
Big moves happen without any overnight news
Here’s what’s happening under the hood:
Rebalancing spillovers from the day before
Late-position adjustments from inflows/outflows
Risk parity or vol-targeting models triggering trades based on overnight data
The market’s not reacting to fresh news — it’s completing its old to-do list.
█ What the Research Really Says About Morning Volatility
The idea that "the true close happens the next morning" isn’t just insider intuition — it’s backed by market microstructure research that highlights how institutional behaviors disrupt the clean narrative of the official close.
Here’s what the literature reveals:
█ Heston, Korajczyk & Sadka (2010)
Their study on intraday return patterns shows that returns continue at predictable 30-minute intervals, especially around the open.
The key driver? Institutional order flow imbalances.
When big funds can’t complete trades at the close, they spill into the next session, creating mechanical, non-informational momentum during the first hour. These delayed executions are visible as persistent price drifts after the open, not random volatility.
█ Wei Li & Steven Wang (SSRN 2010)
This paper dives into the asymmetric impact of institutional trades. It shows that when institutions are forced to adjust positions — often due to risk limits, inflows/outflows, or model-based triggers — the market reacts most violently in the early hours of the day.
When funds lag behind the clock, the next morning becomes a catch-up window, and price volatility spikes accordingly.
█ Lars Nordén (Doctoral Thesis, Swedish Stock Exchange)
In his microstructure research, Nordén found that the variance of returns is highest in the early part of the session, not at the close. This is especially true on days following macro events or at the end/start of reporting periods.
The data implies that institutions “price in” what they couldn’t execute the day before, making the next morning more informative than the actual close.
█ Bottom Line from the Research:
The first hour isn’t wild because it’s full of emotion.
It’s wild because it’s full of unfinished business.
These studies reinforce that price discovery is a rolling process, and for institutional flows, the official close is just a checkpoint, not a final destination.
█ How to Use This as a Trader
⚪ Don't assume the official close is final
Treat it as a temporary bookmark. Watch what happens in the first hour of the next day — that’s when intentions are revealed.
⚪ Volume in the first 30–60 minutes matters
It’s not noise — it’s flow completion. Often non-price-sensitive. Often mechanical.
⚪ Design strategies around “true close” logic
Test fade setups after the first hour’s range is established. That’s often the real “settled” level.
⚪ Use the first-hour VWAP or midpoint as a reference
Institutions may anchor to that — not the official close — for mean reversion or risk metrics.
█ Final Thought
The first hour is not the start of something new.
It’s the conclusion of yesterday’s market.
And unless you understand how institutions truly close their books — and how long that takes — you’ll always be a step behind.
So next time you see chaos at the open, stop calling it random.
👉 It’s just the market putting yesterday to bed — late.
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Disclaimer
The content provided in my scripts, indicators, ideas, algorithms, and systems is for educational and informational purposes only. It does not constitute financial advice, investment recommendations, or a solicitation to buy or sell any financial instruments. I will not accept liability for any loss or damage, including without limitation any loss of profit, which may arise directly or indirectly from the use of or reliance on such information.
All investments involve risk, and the past performance of a security, industry, sector, market, financial product, trading strategy, backtest, or individual's trading does not guarantee future results or returns. Investors are fully responsible for any investment decisions they make. Such decisions should be based solely on an evaluation of their financial circumstances, investment objectives, risk tolerance, and liquidity needs.
