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Contraction

Day Trading! Contraction & Expansion Strategy! BUY GBPUSDDo you ever wonder how banks and hedge funds trade? Ever heard of the contraction and expansion strategy? Please allow to enlighten you. We all know that the market is in consolidation 70% of the time and in lower time frames, those consolidation/Contraction usually happen during the Asian sessions when you are dealing currency pairs such as the EURUSD, GBPUSD, EURGBP e.t.c. As we begin the European and London session, the market tend to come out of the contraction phase and set a new low and this is sometimes interpreted as a signal to enter the market by retail traders and that's one of the reasons why retail traders aren't very successful at trading because they keep falling into the traps of the expansion phase. During the expansion phase, the market usually sets a low/high and then quickly reverses to the highs?lows of the contraction, depending on what the trend is on a higher time frame, the market will follow it and the turning point is the middle line of the contraction. This is one of the strategies that I day trade with my WhatsApp group and we will follow this market and react to it at every turning point. Any opposing comment, views or arguments are welcomed!
Long
by Joseph_Yabwa
42
Recession Time: A Very Non-Technical AnalysisThis idea is mostly based on observations of COVID-19 throughout the world, news and social media reactions, and the U.S. government's responses (White House and the Federal Reserve). I believe a recession is coming, which is not a direct cause of COVID-19. In fact, COVID-19 is the perfect excuse for one. This contraction is highly anticipated but ignored like a world war that nobody wants but still has to participate in. So far: 1. (NOV '19) COVID-19 outbreak first confirmed in Wuhan, China 2. The world reacts to China's response; Stock markets begin to tumble; Questions loom about a possible recession - but CNBC and other news analysts scoff at the notion of a recession 3. (JAN '20) South Korea confirms community spread 4. Countries that underestimate the virus succumb to it very quickly (i.e. Italy, France, Iran, etc.) 5. Some people are finally accepting the reality of the virus (MAR '20); Panic ensues as this reality sets in; Reactions are similar to a hurricane - stock up on toilet paper, canned goods, and water (highly unnecessary if you were already using tap water...) 6. Stock markets continue to tumble 7. (MAR ’20) A brief sigh of relief comes on Friday March 13th as Trump gives State of Emergency declaration - during market hours (probably intentionally); S&P surges 8. The Fed cuts interest rates and commits to purchasing $500 bln in treasury bonds and $200 bln in mortage-backed securities - despite this, S&P futures plummeted; New York City’s public school system (the largest in the country) is officially closing during the COVID-19 outbreak; COVID-19 memes are all you see on social media – this is a good sign that the public is finally taking notice even if it’s a disruption to their lives, however, I don't think this is enough to slow it down. Every U.S. state has at least 1 confirmed case of COVID-19 (www.nytimes.com) Italy – 24,747 cases (+3,590 in the last 24 hours) (www.worldometers.info) Going forward – what you will notice: 9. The insidious fear of a corporate debt bubble returning 10. News outlets will increasingly use “recession” as part of their daily talking points – what happened to “it will never happen”? 11. Trump and the Fed will do everything desperately possible to delay fears of an inevitable recession prior to the Presidential election 12. COVID-19 infections will continue to occur in the U.S. until the end of the year at the earliest; The S&P will continue to decline until vaccines are successfully tested and are produced; By then, we will be in a full-blown recession where many will have accepted it. While some (American) folks are now cautious about COVID0-19, not enough are taking it seriously; Many New Yorkers are still traveling across the city like it’s nothing. Instagrammers are still traveling and taking advantage of cheap flights; Some are literally taking these flights just for the bragging rights. Many say, "The chances of me dying is very low." Yes, but the chances of you spreading it to someone who could, is very high. I'm saving cash and also shorting. I believe the panic and uncertainty will continue throughout the rest of the year. A simple exponential graph will tell you how high the confirmed cases of COVID-19 will be. I’m watching VIX and SPY very closely. The stock market will be blood red next week. If everyone just self-quarantined at home for 2 weeks, it could significantly improve the spread of this virus. But no one will. So, during this COVID-19 crisis, a recession is going to take the reins. I say "crisis" because it's going to be called that very soon. Today, it’s just an "outbreak". I really hope we turn this around but I'm not very sure given these basic observations. I wish you all good health and safety. I'll update this periodically. WASH YOUR HANDS, STAY HOME (if you can), and STOP SCREWING AROUND. Random note: I found this podcast episode along with other resources very insightful: Joe Rogan Experience Episode #1439
AMEX:SPYShort
by traderman001
9
FED vs. POTUS... who will push the dollar more? Find out on the next episode of Dragon Ball DXY... Or we could just guess with what we know now like any analyst. Expecting fed meeting minutes to state what the fed members are stating already, they believe the economy is still resilient and does not need too much expansionary policy, cuts above standard aren't necessary, etc. These statements will reassure many regional institutional investors who put faith in the FED and are confident in their outlook... but investors in other parts of the world who don't like the current leadership of the country or what said leadership is doing to economic relations may not feel the same. It's possible we could see similar unrest in the markets like last week depending on whatever tweet happens to be sent out between Thursday and Friday. While I believe were no where near a scenario where a 100bp cut is necessary, with bond yields inverting and Trump's war on China grinding the global economy, international outlook for the dollar may not be as optimistic. All the same I've drawn out a possible double top scenario I'm picturing as the dollar approaches exhaustion towards the upperside of its range and supply pressure increases from international investors searching for better options. Previous bearish analysis was invalidated so I'll be watching with a neutral perspective as I avoid the dollar this week. But I wouldn't be surprised to see an overall bearish move by end of the week.
TVC:DXY
by david_eke
EUR/CHF: Day-Swing-Setup! Huge MOMENTUMHey tradomaniacs, welcome to another free signal! Important: The market is still news driven and very nervous due to tradewar-talks! Tarrifs might come this midnight (german time). So be carefully and reduce your risk as good as possible! ----------------------------- Type: Day-Swingtrade Sell-Limit: 1,13916 Stop-Loss: 1,14088 Target 1: 1,13655 Target 2: 1,13461 Point of risk-reduction: 1,13793 ----------------------------- LEAVE A LIKE AND A COMMENT - I appreciate every support! =) Peace and good trades Irasor Wanna see more? Don`t forget to follow me. Any questions? PM me. :-)
Short
by Trading2ez
NZDJPY (4H) - complex wedge formation - possible reversalThe wedge formation shown is not pure. It is complex. The tighter sharper wedge could see price falling out and to the south. The other enclosing wedge could see price rising north. In situations like these one has to decide: 1. Long with an ATR appropriate stoploss. 2. Short with an ATR appropriate stoploss. 3. Stay out completely. In addition to the wedge there appears to be a scallop formation which could herald a move north. This is not a high probability trade. But based on experience, I take the position.
Long
by Captain_Walker
A quick lesson on trading ranges from expansion to consolidationHere's a quick lesson on how to look at trading ranges with TSLA and FB as an example. Expansion to contraction is an excellent tool to help you go a little further on your trading journey. Learn more by joining the CTP Group. We will teach you how to use charts to do a top down approach on any stock in under 5 minutes just for joining. Look to get 1-4 emails per month after that, if you ever stop learning, just unsubscribe. You won't be sorry. mailchi.mp
NASDAQ:TSLA
by CustomTradePlan
IOTA: IS THE HIBERNATION OVER?After a huge bearish phase, the price has generated a simmetric triangle that is to be seen as the result of the congestion of the fluctuations. Both R.S.I and Stochastic haven't reached the overbought zone. However, I suggest paying attention to possible bearish crosses in the aforementioned second oscillator. The breakdown of the support or of the triangle resistence will give rise to a strong directional movement. This one will be matched with a growth of the volumes which have been flat so far. That fact means that the trade is facing a contraction and reload phase, then entering a high volatility area. We may get surprises.
BITFINEX:IOTUSD
by CryptoSphere_TC
$len losing momentum/distribution higher time frame is showing range bound price action- negative divergence in rsi closer look at mid time frame shows the transition from a range expansion to range contraction and selling volume pressure being applied along with negative momentum lower time frame shows price action in that same range contraction apply pressure to the support area with multiple retest looking for alignment across all timeframes to tilt to the bearish side where theres is the least resistance to the downside first level to 51.7x area and then down to 51.1x
NYSE:LENShort
by inco1
$vod breakout lookout-long term trend- uptrend and showing strength -intermediate timeframe shows trend is in an uptrend but slightly flattening -volatility is contracting.. pressing up on resistance area of 29.9x -not paying too much attention to rsi here because of stock showing strong trend strength. -positive volume pressure being applied -shorter timeframe is showing price action in a symmetrical triangle with a .20 measured move- which would lead to the break of resistance area up to 30.0x -cautious to the possibility of a false breakout- entry at 30.05 and setting stop at 29.71 gap low -once resistance is broken extension level/profit target set at the .618 level of 31.67
NASDAQ:VODLong
by inco1