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Patience vs TradingPatience is a great quality in trading. Why ? Simply because it helps you not ceeding to impulsivity and it helps you decreasing mistakes. Patience in trading is similar to patience in poker. A good poker player will wait hours to get the best hand possible. He will wait for a very good pair like AA or KK instead of risking losing with weak pair like 44 or 66. Of course having AA or KK is not a guarantee of winning but you get a much higher probability to do so. In trading you face the same problematic. Sometimes the market doesn't give you anything, no info, no pattern. In this case, you should close your laptop and do something else. Really !!! The more you trade, the more you are exposed to make big mistakes. I used to make scalping for a time but I quickly realized that it was not for me. Staying all day in front of a laptop waiting for an opportunity, no, many opportunities to get 2 to 10 pips only. Some traders are very good scalpers but I am not. I am a swing and day trader. I look for 30 to 20,00 pips on each trade. You really need patience to get 1000 pips profit ! And obviously I have a dedicated account for this kind of investment. Why ? Because, after having made 100 pips, the temptation is huge to take my profit and close the trade. On this account you only have very long term trades where potential is 500 to 20,000 pips ! Patience is also a quality when you do not see any opportunity on the market. You are frustrated, you want to feel the adrenaline of trading. Calm down, stay cold. The market always gives opportunity, It will happen very soon trust me but at this moment, use this time to improve your skills, reading, learning, analysing or simply deconnecting totally from trading. Think how you feel good without the stress of a losing position when you are always looking after your smartphone to check the price. Be patient, wait for the optimal opportunity wen you can sell high and buy low. The opportunity which gives you the best risk-reward. Patience vs trading ? No ! Patience = Trading !
BITFINEX:BTCUSDEducation
by Traderscope
6
5 Natural Reactions To Failure In Trading5 natural reactions to failure in trading It could be very useful to understand your natural behavior when you are faced to failure in trading. All of us are facing losses, sometimes these losses can be huge when come a krach or a bad choices. The situation in itself will not determine the reaction of the trader. It is his personality, his history facing which will determine it. 1. Anger Being anger is a natural feeling. It is the direct consequence of a loss. But you are not anger about the loss itself but about the causes which led to this loss. In fact, before taking this position, you knew that it was not a good idea or even a good timing maybe because: - The lot size was too big - There was a big data released 1 hour later - You moved the stop loss - You bought too high - You sold too low - ... You knew it but you made it ! Why ? Not enough patience ? not enough discipline ? You need to analyse it and correct this behavior. The anger must give you the opportunity to learn about the cause of it. Most of traders are not able to coldly analyse the causes, It not that easy. It's a fight against oneself. Don't be wrong. Losing a trade in trading is inevitable. It is the way of losing that is avoidable. Risking all its capital on one trade and get angry against everybody around you while it is you who accumulated mistakes, is this really honest? You are the only responsible for your loss and you must learn from it. You must learn to lose and you must learn to lose well. 2. Runnning out on his responsabilies When you lose a trade, the good behavior is to analyse the reason of the fail. Why did this trade go wrong ? Some of you may be very passive on a fail. Ok I lost this one but the next one will be in success, then the next one is a fail and the next one too and the next too etc etc. Maybe your strategy is not good. You should question yourself after each losing trade. 3. Guilt feeling This feeling is human and totally normal ! You blame yourself when you give in to your impulsiveness, when your reasoning is wrong or when your behavior has pushed you to failure. You had the choice to act another way. You had the choice not taking this trade or managing it another way. You know it and it is a good thing. Now assume it ! Yes you made a mistake but how will you act to change the behavior which led to all this ? This is the most important point. Be responsible of your choices and be responsible of your acts but don't keep blame yourself constantly. Try to improve yourself everytime, everyday. 4. Sadness Don't let sadness affect you ! Sadness is a sign of weakness. Weakness is the synonyme of KO. It is really dificult to get up back from this feeling. Sometime it lead to depression. This is the case when a trader loses everything after a krach or bad choices. Many of you could have experienced this already. If you are in this situation, ask for help. Sometimes it could be an humiliating situation. Be strong ! You can ask for advice if necessary. It is important for you to get out of this situation. 5. Giving up Trading is not that easy because psychology is an important part of sucess. Being a successful trader means that you handle 3 key elements : - Strategy (You improve it everyday) - Discipline (You apply a strict money management, you follow it no matter what happens) - Psychology (You are psychologically strong, you handle your emotions) Some people cannot assume all of this. If you tried but you failed, maybe it is not for you. Some people are not able to be good in trading. Accept it, give up and move on. --- All these natural reactions to failure can be overcome by taking a step back on the event. Put into perspective, bring nuance, change its point of view; the acceptance of failure requires a real effort whic is essential in trading
BITFINEX:BTCUSDEducation
by Traderscope
4
The Escalation Of Failure In TradingThe escalation of failure in trading ! : 5 reasons why most of traders lose their money ! Reason 1 / Step 1 : The "I DON'T ACCEPT LOSING" syndrom Reason 2 / Step 2 : The "I MOVE MY STOP LOSS" temptation Reason 3 / Step 3 : The "AVERAGE DOWN" disease Reason 4 / Step 4 : The "RISK EVERYTHING" game Reason 5 / Step 5 : The "I SWEAR IT WILL NEVER HAPPEN AGAIN" lie to yourself Let me tell you the story of JOE the gambler : Joe creates an account with $1,000 with a broker offering a x500 leverage. Virtually, Joe could invest almost $500,000 on the market ! Amazing ! Joe thinks that he is a reasonable investor and start investing with 0.05 lot. Joe creates an account with $1,000 with a broker offering a x500 leverage. Virtually Joe could invest almost $500,000 on the market ! Amazing ! So Joe has $1,000 on his account. He has a very good investment strategy which has worked very well for 1 month on demo account. Joe's projections gives $250 profit in one month. It is time now to pass on real account. Joe has read many articles about money management and joe wants to risk only 3% of its capital on each trade. Joe's strategy is to take trades only if a combination of several indicators give the same signal. Joe always use stop loss and take profit. The plan is the plan no matter what ! Right ?! Joe bought 0.05 lot on EURUSD at 1.2200 with a SL at 1.2150. He thinks that the price will increase from 100 pips at least in the next hours to reach 1.23. Reason 1 / Step 1 : The "I DON'T ACCEPT LOSING" syndrom Problem, the price falls from 40 pips. Joe starts panicking. Reason 2 / Step 2 : The "I MOVE MY STOP LOSS" temptation Joe decides to move the SL from 50 to 100 pips at 1.21. Reason 3 / Step 3 : The "AVERAGE DOWN" disease Problem, the market decides to go down again and the position shows a 80 pips floating loss. Joe decides to move the SL from 100 pips to 150 pips at 1.2050 and take a new position of 0.05 lot on EURUSD at 1.2120 with a SL at 1.2050. Problem, the market continues its fall and the price displays 1.2070. Joe thinks OK. I move my SL from 1.2050 to 1.1950. It gives more margin to let breathe the market and Joe takes a third position of 0.05 lot at 1.2050 with a SL at 1.1950. The average price is now 1.2123. Problem, the next days the market starts a range between 1.20 and 1.21 and Joe wants absolutely to leave the overall position in profit. Pride ! Joe loses patience and decides to take a new postion of 0.1 lot on EURUSD at 1.2070. The average price is now 1.2102. Joe is stressed and tired of this situation and decides to put an overall TP at 1.2120. The probability to hit the TP is high. Finally the market goes up and hit the TP during the night and when Joe wakes up the the price on EURUSD is 1.2200. Oh my GOSH ! Joe is frustrated ! Why did I change my TP ? I missed a lot of profit on this movement !!! Joe decides to take a new trade on EURUSD at 1.2200 without SL this time because this time is the right one !!! Pride !!! Problem, the market falls from 25 pips at 1.2175. Joe is convinced that he is right so he takes a new BUY pending position at 1.2150. And now the market makes a huge falls from 1.2175 to 1.2050 during the day. Joe has now 2 positions of 0.05 lot size. At this moment, Joe decided reasonably to close all positions with losses at 1.2050. Joe lost 275 pips on these 2 hasardous trades.
Education
by Traderscope
8
The Escalade Of Failure In TradingThe escalade of failure in trading ! : 5 reasons why most of traders lose their money ! Reason 1 / Step 1 : The "I DON'T ACCEPT LOSING" syndrom Reason 2 / Step 2 : The "I MOVE MY STOP LOSS" temptation Reason 3 / Step 3 : The "AVERAGE DOWN" disease Reason 4 / Step 4 : The "RISK EVERYTHING" game Reason 5 / Step 5 : The "I SWEAR IT WILL NEVER HAPPEN AGAIN" lie to yourself Let me tell you the story of JOE the gambler : Joe creates an account with $1,000 with a broker offering a x500 leverage. Virtually, Joe could invest almost $500,000 on the market ! Amazing ! Joe thinks that he is a reasonable investor and start investing with 0.05 lot. He has $1,000 on his account. He has a very good investment strategy which has worked very well for 1 month on demo account. Joe's projections gives $250 profit in one month. It is time now to pass on real account. Joe has read many articles about money management and joe wants to risk only 3% of its capital on each trade. Joe's strategy is to take trades only if a combination of several indicators give the same signal. Joe always use stop loss and take profit. The plan is the plan no matter what ! Right ?! Joe bought 0.05 lot on EURUSD at 1.2200 with a SL at 1.2150. He thinks that the price will increase from 100 pips at least in the next hours to reach 1.23. Reason 1 / Step 1 : The "I DON'T ACCEPT LOSING" syndrom Problem, the price falls from 40 pips. Joe starts panicking. Reason 2 / Step 2 : The "I MOVE MY STOP LOSS" temptation Joe decides to move the SL from 50 to 100 pips at 1.21. Reason 3 / Step 3 : The "AVERAGE DOWN" disease Problem, the market decides to go down again and the position shows a 80 pips floating loss. Joe decides to move the SL from 100 pips to 150 pips at 1.2050 and take a new position of 0.05 lot on EURUSD at 1.2120 with a SL at 1.2050. Problem, the market continues its fall and the price displays 1.2070. Joe thinks OK. I move my SL from 1.2050 to 1.1950. It gives more margin to let breathe the market and Joe takes a third position of 0.05 lot at 1.2050 with a SL at 1.1950. The average price is now 1.2123. Problem, the next days the market starts a range between 1.20 and 1.21 and Joe wants absolutely to leave the overall position in profit. Pride ! Joe loses patience and decides to take a new postion of 0.1 lot on EURUSD at 1.2070. The average price is now 1.2102. Joe is stressed and tired of this situation and decides to put an overall TP at 1.2120. The probability to hit the TP is high. Finally the market goes up and hit the TP during the night and when Joe wakes up the the price on EURUSD is 1.2200. Oh my GOSH ! Joe is frustrated ! Why did I change my TP ? I missed a lot of profit on this movement !!! Joe decides to take a new trade on EURUSD at 1.2200 without SL this time because this time is the right one !!! Pride !!! Problem, the market falls from 25 pips at 1.2175. Joe is convinced that he is right so he takes a new BUY pending position at 1.2150. And now the market makes a huge falls from 1.2175 to 1.2050 during the day. Joe has now 2 positions of 0.05 lot size. At this moment, Joe decided reasonably to close all positions with losses at 1.2050. Joe lost 275 pips on these 2 hasardous trades.
Education
by Traderscope
The Escalade Of Failure In TradingThe escalade of failure in trading ! : 5 reasons why most of traders lose their money ! Reason 1 / Step 1 : The "I DON'T ACCEPT LOSING" syndrom Reason 2 / Step 2 : The "I MOVE MY STOP LOSS" temptation Reason 3 / Step 3 : The "AVERAGE DOWN" disease Reason 4 / Step 4 : The "RISK EVERYTHING" game Reason 5 / Step 5 : The "I SWEAR IT WILL NEVER HAPPEN AGAIN" lie to yourself Let me tell you the story of JOE the gambler : Joe creates an account with $1,000 with a broker offering a x500 leverage. Virtually, Joe could invest almost $500,000 on the market ! Amazing ! Joe thinks that he is a reasonable investor and start investing with 0.05 lot. Joe creates an account with $1,000 with a broker offering a x500 leverage. Virtually Joe could invest almost $500,000 on the market ! Amazing ! So Joe has $1,000 on his account. He has a very good investment strategy which has worked very well for 1 month on demo account. Joe's projections gives $250 profit in one month. It is time now to pass on real account. Joe has read many articles about money management and joe wants to risk only 3% of its capital on each trade. Joe's strategy is to take trades only if a combination of several indicators give the same signal. Joe always use stop loss and take profit. The plan is the plan no matter what ! Right ?! Joe bought 0.05 lot on EURUSD at 1.2200 with a SL at 1.2150. He thinks that the price will increase from 100 pips at least in the next hours to reach 1.23. Reason 1 / Step 1 : The "I DON'T ACCEPT LOSING" syndrom Problem, the price falls from 40 pips. Joe starts panicking. Reason 2 / Step 2 : The "I MOVE MY STOP LOSS" temptation Joe decides to move the SL from 50 to 100 pips at 1.21. Reason 3 / Step 3 : The "AVERAGE DOWN" disease Problem, the market decides to go down again and the position shows a 80 pips floating loss. Joe decides to move the SL from 100 pips to 150 pips at 1.2050 and take a new position of 0.05 lot on EURUSD at 1.2120 with a SL at 1.2050. Problem, the market continues its fall and the price displays 1.2070. Joe thinks OK. I move my SL from 1.2050 to 1.1950. It gives more margin to let breathe the market and Joe takes a third position of 0.05 lot at 1.2050 with a SL at 1.1950. The average price is now 1.2123. Problem, the next days the market starts a range between 1.20 and 1.21 and Joe wants absolutely to leave the overall position in profit. Pride ! Joe loses patience and decides to take a new postion of 0.1 lot on EURUSD at 1.2070. The average price is now 1.2102. Joe is stressed and tired of this situation and decides to put an overall TP at 1.2120. The probability to hit the TP is high. Finally the market goes up and hit the TP during the night and when Joe wakes up the the price on EURUSD is 1.2200. Oh my GOSH ! Joe is frustrated ! Why did I change my TP ? I missed a lot of profit on this movement !!! Joe decides to take a new trade on EURUSD at 1.2200 without SL this time because this time is the right one !!! Pride !!! Problem, the market falls from 25 pips at 1.2175. Joe is convinced that he is right so he takes a new BUY pending position at 1.2150. And now the market makes a huge falls from 1.2175 to 1.2050 during the day. Joe has now 2 positions of 0.05 lot size. At this moment, Joe decided reasonably to close all positions with losses at 1.2050. Joe lost 275 pips on these 2 hasardous trades.
Education
by Traderscope
1
The Power of Stop Loss and Risk/Reward in tradingKeep this in mind. Only one trade without stop loss can burn your capital. A stop loss is an indispensable tool allowing you to limit your losses. It is also a level from which you feel that your scenario will not happen anymore. It is mandatory on every position if you want to keep your money safe. See it like an insurance policy. In case the trade is going wrong, you can be sure that a large part of your capital will be safe. You just need to know how to place your stop. It also allows you to sleep peacefully because a stop loss deletes the stress and allows you doing activities other than trading. You don’t need to monitor your trade every 10 minutes. The less you monitor your trade the less you risk to make mistakes. Some people will say that stop loss decreases the winning ratio. Many traders argue to get 90% to 100% of winning trades. Hmmm why not but do they use stop loss? If yes what is their risk/reward ratio? How to place and manage your stop loss? Place your stop loss according to the market price level. It must be placed above or below a key level such as a support, a resistance or a higher/lower. Don't place your stop loss on a support, resistance or higher/lower. It is there that you should place your entry point! Respect the Risk/Reward ratio. A RR of 2 or more is a key of success in trading. I give you more details below. Take into account the volatility of the asset. The more volatile an asset is, the greater is the risk of seeing your stop loss hit on a volatility movement. On a volatile asset, you need to further your stop loss level. This element must be taken into account especially if you carry out long term trades, on daily, weekly or monthly timeframes. Never move your stop if the the trade goes wrong! The only context allowing you moving your stop is if the market goes right in order to secure your profit. In this case you can move your stop to the breakeven point (Entry) or more to ensure some profit. The Risk/Reward ratio, the secret of success What is the Risk/Reward ratio or RR ? The RR ratio is the difference between the potential loss and the potential profit of your trade. You simply divide the pips number you expect to win by the pips number you expect to lose. Assume that you place an order with a TP at 50 pips and a SL at 100 pips then your RR ratio will be 0.5 which means that you will need to win 2 trades to recover the loss of 1 trade. Now assume that you place an order with a TP of 100 pips and a SL of 50 pips then your RR will be 2 which means that you will need to win only 1 trade to recover the loss of 2 trades. Never take a trade if your risk/reward ratio is below 1. A RR of 2 and more is one of the key to become successful in trading on a long run. Imagine the insane performance it would be, if every trade you make had a RR of 2 with 70% of winning trades! Hope these little tricks will help you improve your trading.
BITSTAMP:BTCUSDEducation
by Traderscope
19
Learning how USD corrolates with non-USD currencies. EURCADMy CURRENT definition of RISK. RISK ON USD down, moving XXX/USD currencies up and USD/XXX currencies down. or RISK OFF USD up, moving XXX/USD currencies down and USD/XXX currencies up. Mid term (3 wks-6mo) I lean bias towards 2018 trading in RISK ON mode. Which means EURUSD is a buy mid-term. USDCAD is a sell mid-term. In the last several months we have been in RISK ON mode with EURUSD in a obvious uptrend. I've noticed EURCAD trends UP when we are risk on. So mid-term we cannot expect to short EURCAD because we know the underlying currencies are in up trends. Short term I do believe there is room for a pullback to the 1.53 or 1.52 levels coupled with a pullback in EURUSD. But ultimately I will be looking to trade EURCAD higher in months to come. Full Disclaimer: This is a test I'm running to better understand how correlations among two USD pegged pairs perform when pegged against each other. I will be referencing both EURUSD and USDCAD often. EURUSD is perfectly 1-1 inversely correlated with USD. This is because the EURUSD is the strongest correlated currency to the USD in the world and ultimately controls EURCAD by nature. Trade between the United States and the European Union is over half of USD transactions so EURO's are the most strongly correlated out of all other currencies. That being said when I'm looking at the price of EURUSD, I'm actually reflecting on the price of USD if that makes any sense. EURUSD is up when USD is down BECAUSE USD is down! I track USD with the US Dollar index. Ticker DXY. If you found this useful or thoughtful Likes/Comments/Follows are much appreciated! Disclaimer: Oanda data shown. Material is educational only. Trade at your own risk! and ultimately controls EURCAD by nature
Education
by UnknownUnicorn981629
How to filter noise out of Technicals and Fundamentals part 1Part 1 Technical If you are new like me you probably have tons of conflicting information bombarding you at all times. I have come up with a method of filtering the noise i would like to share. * Technical noise filtering step 1: Renko blocks. Renko blocks are simple they do not measure time. Renko blocks measure movements in price (example: 1 block = 10 pips if price moves 20 pips down you get a block down if price moves 10 pips up you get another block up). you can google Renko block plugin's they are available for most platforms free. step 2: Combine your Renko chart with your favorite indicators. (I like a 6 period MA that paints red if pointed down and blue if up with a donchian line for up and down trend filtering.) step 3: compare larger size Renko blocks to smaller and scale in. For example: 1: I look at 200 pip Renko Blocks for the direction is should be looking to go buy or sell wise. 2: If there is a string of Blocks up the odds are in favor of another block going up the odds increase the more blocks in a row we get. 3: The objective is to buy low sell high and vise versa ergo we need to find the bottom of our 200 pip Ranko block to do this we make another Renko chart of 20 pip Renko Blocks. 4:Compare your Renko charts noting how long the tails on the previous 200 pip Renko blocks going up were. 5:Look at the at the 20 pip Renko block charts and try to find out where the Bottom of the tail on the 200 pip Renko box might go. 6:We are looking to buy into a trend not "predict" a trend. wait for a good dip then buy as it trends up. lets use an Example EUR/USD Technical analysis example 1/27/2018 1: i67.tinypic.com This 200 pip Renko chart depicts dates from the European debt crisis downtrend in 2014 to the current uptrend. as we can see from the 200 pip Renko Boxes the EUR/USD is clearly going up. The objective is to place a buy order at a point where the price is not likely to retrace to. As we can see the uptrend is very strong the up boxes have small tails or none at all. 2: lets open a chart with smaller Renko boxes for this example i am going to use 20 pip Renko Boxes. i65.tinypic.com This chart is from dates Dec 28th 2017 to Jan 24 2018 As we can see from this 20 pip Renko block chart the 200 pip up blocks form a lot like stairs when we look inside them. They do this because the market only seems to do one of 2 things 1: consolidation (a point in time where entering the market either long or short is likely to lose) 2: Trend (a point in time where entering the market has a higher probability of going in the same direction) As someone new to Forex I like to think about consolidation zones as graveyards because they are where all my trades go to die ;) The term "graveyard" will now refer to consolidation zones for effect. So we want to get on the trend and avoid the graveyard how do we know when we are out of the graveyard? The best answer is we don't. The second answer is count the number of whipsaws that happened before the last few up trends and average them. (A whipsaw is a high and low point they tend to gravitate right into your stop loss before heading right into your take profit they are the main characteristic of a graveyard.) Lets average the Whipsaw characteristics for the current EUR/USD 1/27/2018 as we can see from our 20 pip chart we usually get 5 Whipsaws per graveyard. They usually retrace to about half the uptrend but few break back above the uptrend before whipsawing down again so we can be somewhat safe to say we are out of the graveyard and into the trend if: *we had a few whipsaws *the price retraced down half the previous uptrend *the price is now above the uptrend Part 2
Education
by malikiie
How to filter noise out of Technicals and Fundamentals part 2 Part 2 Fundamental noise filtering I place far more weight on fundamental analysis then technical. At first I thought it was useless as half the news or analysts would say one thing and the other half would say the opposite. the trick is to only look at sources that can reliably and logically be shown to have a impact on the market. Who has an impact on the market: 1: Speculators (yep just speculators not the news or the actual state of an economy) while that statement is not exactly true it seems to be a reliable self fulfilling prophecy lets take a look at large speculators positions from 2002 until 2018 compared to a bar chart. i65.tinypic.com this picture shows the weekly CFTC commitment of traders reports from 2002 to 2018 correlated into a line chart under a corresponding bar chart. The arrow in the picture points to a turning point where the speculators (green line) went from net short to net long. what happened? The market shot up like a rocket. outside of consolidation periods the market just about always drops or gains right after this happens just looking at the EUR it ALWAYS marks the end of a trend without fail. Its almost eerie how accurate the CFTC comittment of traders reports are at predicting trend changes. where do we get the COT report and how do we use it? Step 1: go to www.cftc.gov step 2: click on the Chicago Mercantile Exchange and scroll past the butter, cows and logs to the EURO FX i67.tinypic.com step 3: look at the important parts of the EURO FX data. i67.tinypic.com 1: the date of reported positions 2:Non-Commercials (people investing to make money. These are the people who have so much money in positions they have to report it to the CFTC weekly. people and company's with that kind of money have far more resources to base their decisions off of then me and if most of them think in one direction then odds are most of them are right. As we can see on the chart in the picture most of them went net short not during but before the euro crashed in 2014.) 3: On the left long positions on the right short positions. (far more long then short this is a definite uptrend.) 4: changes from last week. very very important for positioning in immediate furtue. For example on the 9th we got this report i66.tinypic.com what happened directly after was an uptrend. look for changes in net long and short positions. An increase in net long from last week or a decrease in net short from last week will likely predict an uptrend in a day or 2. sometimes the trend already happened by the time you get the report. The COT report is the only fundamental analysis I use. Why: 1. conflict of interest. most of the large news company's are owned by banks ergo any information I gather based on news is biased. 2. Education I grew up on fishing boats in Alaska and currently drive a forklift all day. forming a accurate opinion based on economic data on my own is beyond my level of education. Lets recognize our weak points and not pretend we can be on par with someone who has spent years in college for economics. 3. Retail traders are 90% wrong and I am a retail trader lets take a quick look at how Retail traders net positions look. www.oanda.com as we can see with the EUR/USD 63% of retail traders are trying to short a market that has been going up for months non-stop and they have been for months its usually worse then 63% too lul.
Education
by malikiie
How to pick a level to buy or sell at effectively?Cause and effect. That's all that you really need to know. Always ask yourself, 'which area started the move that caused a long term key level to break?' What is this important? Because it shows a clear supply and demand imbalance at that price. It shows that there is interest at this specific zone, at which, there is likely to be unfilled pending orders, as well as a desire to initiate market orders on a return to the zone. This is why you might notice that sometimes when you trade a breakout, the market may have a deeper retrace into the level, rather than simply using the broken level as support or resistance (and then stopping you out). You have to interpret price alongside technical analysis, since the market doesn't care about what YOU think, but where it can find the best liquidity to initiate orders. In the Cable example shown, you can see that the $1.70 level played a key part in knowing where price support was on the move up to $2.00+. Using the weekly chart, we can then see where our 'key zone' to sell into is. This is denoted as a supply zone - where you see a bullish candle in a down move just before the key support is broken (or the first bullish candle just before the support is broken). The opposite is true for a demand zone - this is where you see a bearish candle just before the key resistance is broken (or the first bearish candle before a level is broken). This method is very easy in terms of risk management - your stop goes above the supply zone and below the demand zone. I then have a take profit at the next key level - you're just trading between zones. When you become used to this, you can then go down in your timeframes and have more intraday positions, or intrahour if you so wish. A few things - it's easier to manage risk on a longer term trade. It's also easier to increase position sizing on longer term trades, as well as higher timeframes having more overall significance and a higher win rate, although the opportunity cost of this is the fact that you have less frequent opportunities and it requires a hell of a lot more patience.
Education
by FinkPro
EURUSD – Is it doing an about turn for the worse? - Update In my previous chart of EURUSD, you will find lots of details explaining why I am anticipating a new bearish cycle in which the wave 4 (in circle) was about completed and wave 5 (in circle) was about to commence. There are lots of additional charts in comment section to help validate longer term view. This chart is linked below for your reference. We did not have the follow through to initial decline. Instead a new high was pasted last week. At present, I do not think that this has really changed much for the longer term. In the short term wave 4 was still in progress. So this is a second attempt to identify possible completion of wave 4, which could now be in place or will be shortly. If correct then wave 5 will follow as anticipated. In addition to details describe in the earlier chart referred to above, here is the summary of updated technical: 1. We have a trendline from July 2008 high, connection April 2011 high (but ignoring May 2014 as over throw) which comes in to proximity of current price that might mark wave 4 high. 2. We have an uptrend line on RSI from 2013 and August 2017 peak appear to suggest a hidden bearish divergence along with normal divergence with price making new high above August peak and RSI making lower high. 3. In addition to that, we have possible time symmetry shown on the chart – namely April 2011 High to March 2014 closing high measures 150 bars on weekly charts, which equates to approx 149 bars measured from March 2015 low to current high. 4. Fibonacci time relationship between Waves 1 – 3 and wave 4 is approx Fib ration of 1.3618 as shown in the chart. 5. Open Interest and Net Long by Large Speculators is even more extreme now than the one we noted at previous peak in August/September 2017, see chart below. Short Entry: You can drop down to daily or 4 hour time frame to time short entry on confirmation using your normal method. Just keep in mind that it might can chop about before it gets going in anticipated decline. Warning: This is my interpretation of price action using TA approach that I consider helps the me most, but could be completely wrong. Therefore, as always, do your own analysis for your trade requirement and ignore my views. For those who appreciate my analysis, select to follow me and the chart for notification of future updates. Indicate you like my analysis by thumbs up, comments and sharing it with others. If you have an alternative idea then, please be constructive and share for all to learn from. Thank you for taking the time to read my analysis. DanV
Education
by DanV
14
EUR & YEN Futures - Use of Commitment of Traders data Commodity & Futures Trading Commission gather data from various Exchanges and compile which are then released and are available on their Websites - www.cftc.gov Commitment of Traders Data = COT (abberiviation) These data are released on Friday of Each Week after Market Closes. They are based on Positions as close of Tuesday of that week. These are compiled to show 3 main groups which are: Commercials = Banks, Broker/Dealers (Hedging the Risk), Producers, Wholesalers, Or Commodity Users – Either looking to Hedge Risk or Receive or Send Delivery Speculators – which are: Non-Commercials = Money Managers, Hedge/Leveraged Fund Mangers, who are Speculators and are not looking to for delivery or receiving one on settlement day Non-Reportable = Still large traders, but a whose positions falls below the threshed to be classes as Non-Commercial Non-Commercials have Research Departments manned by Fundamental and Technical Analysts. These are then use by their trader. Therefore their positions reflect both the Fundamental and Technical analysis and can be viewed as Hybrid. Their sudden change from week to week of significant amount or percentage and their overall net long or short compared with historical behaviour can be used as what might be deemed as relative extreme together with Open Interest and Technical Analysis can provide interesting and useful insight in the strength of the trend or possible reversal. See the linked EURUSD chart and a video publication of Oil for further details on how I have used them. Below is a link of examples of the weekly data released for Futures for respective Instrument: drive.google.com I hope it will helps you in your own application of this to your Technical Analysis. Thank you for viewing my video and welcome comments or questions. DanV
Education
by DanV
8
Trends are THE MOST IMPORTANT tool in the toolbox.Hello Traders. Hope everyone is staying warm. Snow and zero degree temperatures expected in Virginia. Many traders use many different indicators. There are so many its impossible to tell which ones are useful. Simplicity is key. The most important tool in a traders toolbox is the ability to deceiver the prevailing trend. Using higher high/ lower low analysis we can identify the difference between strong market moves and weaker ones. This stems from the well known philosophy that in order for markets to continue moving in the correct direction they need to confirm momentum shift before making large moves. -Resistance is considered overhead levels that price struggles to break AND CLOSE above. -Support is considered under price levels that price struggles to break AND CLOSE below. Notice how I mention, AND CLOSE. It is 100% required that price CLOSES above the support or resistance level to declare it broken on whatever time frame chart being traded. After the perfect head and shoulders pattern unfolded many traders continued to short EURUSD without much success (Took a stop loss myself) One must recognize the downward momentum was triggered by the bearish head and shoulders pattern (see attached post, traded perfectly.) In actuality the trend is still bullish. At the end of the head and shoulders move, trend reversed only briefly. Price was unable to break the low before moving higher. At (1) the first top was made. After making new highs, we always expect a retest of old resistance confirming support. (2) Price came back and tested old resistance, confirming support in a reckless fashion. This wiped all long traders out and assured direction for short traders who were burned before. Once everyone was mixed up, the trend prevailed to the upside. Now we find ourselves at (3). New highs have been confirmed so price is expected to retest old resistance to confirm as support around the 1.19500ish level. At this level I will be watching diligently for signs of rejection and ready to take entry on a single close of any rejection formations. If we confirm price action, targets are estimated around 1.2300. IF you found this useful or thoughtful Likes/Comments/Follows are much appreciated! TElphee – Self-made Technical Analyst. 5-year market enthusiast with experience in Forex, Futures and Cryptocurrencies. Disclaimer: Oanda data shown. This is NOT investment advice.
Education
by UnknownUnicorn981629
8
What does a Break-Hook-Go look like.Break Hook Go is a candle pattern of several candles not just one candle. Here is what it looks like on this EURUSD trade. The bearish breakout did not complete the break-hook-go (B-H-G) and failed. The bullish breakout did have a B-H-G. There was a green breakout candle on the 15m chart. The second green candle had a bearish wick for the Hook (pullback) then it closed green for the Go. On the 5m you can see the separate candles that made that up the 15m B-H-G. 5m - Break green candle Hook red candle Go is a green continuation bullish candle.
Education
by Tradingstrategyguides
If you are continuously loosing money ,read and apply this......PART 1 Are you tired and exhausted of finding a strategy that works, are you tired of predicting forex markets only to find out sometimes it works and sometimes it doesn't. First of all, you have to see what are your beliefs and you need to verify if you have right beliefs. Many traders think that forex trading is not gambling and to make money from forex you just need a golden strategy that works. I can write thousands of words on how beliefs always defend itself from discomforting knowledge and people with such wrong believes end up giving their money to markets. In simple words: TRADING IS GAMBLING If trading is gambling then how to make money out of it? There are many people who make consistent profit from the market. { including me :) }. TREAT FOREX LIKE CASINO TREAT THIER GAMBLERS Forex trading is a probability game. Corporations spend vast amounts of money, in the hundreds of millions, if not billions, of dollars, on elaborate hotels to attract people to their casinos. How do you suppose they justify spending vast sums of money on elaborate hotels and casinos, whose primary function is to generate revenue from an event that has a purely random outcome? Here’s an interesting paradox. Casinos make consistent profits day after day and year after year, facilitating an event that has a purely random outcome. At the same time, most traders believe that the outcome of the market’s behavior is not random, yet can’t seem to produce consistent profits. Shouldn’t a consistent, non-random outcome produce consistent results and a random outcome produce random, inconsistent results? What casino owners, experienced gamblers, and the best traders understand that the typical trader finds difficult to grasp is: Events that have probable outcomes can produce consistent results, if you can get the odds in your favor and there is a large enough sample size. The best traders treat trading like a numbers game, similar to the way in which casinos and professional gamblers approach gambling. ___________________________________________________ Patterns, Fibonacci, indicators, support and resistance lines etc don't work ___________________________________________________ Before you start to think i am crazy, please continute reading. I know many pattern traders, support and resistant traders and fibo traders on this websites. They hardly predict market 50% right. Some of them are around 50-60% range. I can toss a coin and can come up with a 40-60% winning rate. Therefore if your strategy works, then my coin strategy works as well. Technical Strategies sometimes work and sometimes don't, just like a flipping a coin. If you have a strategy which won last 9 times, does it mean it will work 100% 10th time? No ! there's still a 50-50% chance, just if 9 coin flips showed heads last 9 times, doesn't mean 10th will also be a head. 5 rules to be a consistently successful trader over the long term: >> ANYTHING CAN HAPPEN: There are always unknown forces operating in the market at every moment. Regardless of how much time, effort, the money you have to spend in your analysis, from the market perspective, the outcome will always be random. >> YOU DON'T NEED TO KNOW WHAT IS GOING TO HAPPEN NEXT IN ORDER TO MAKE MONEY: why? because there is a random distribution between wins and losses for any given set of variable that defines an edge. Just like a casino with random outcomes, you can make a consistent profit. >> THERE IS A RANDOM DISTRIBUTION BETWEEN WINS AND LOOSES FOR ANY GIVEN SET OF VARIABLE THAT DEFINES AND EDGE: Every losing trade puts you one step closer to a winning trade because the outcomes of any edge are totally random. The same theory is applied by casinos if someone wins money casinos don't get scared as they knew over the long term they will win. >> AN EDGE IS NOTHING MORE THAN INDICATION OF A HIGHER PROBABILITY OF ONE THING HAPPENING OVER ANOTHER: If you have a strategy which gives you higher probabilities .....( limited words)..
Education
by Wave-Expert
5
"Trade Like A Casino" (Trading Psychology)What is the best way to make money on gambling? Own a casino. - Casinos operate as a business. - Casino have table limits to manege and their customers are likely to risk it all. - Casinos have a mathematical edge, and gamblers are at a disadvantage. - Casino has no ego or emotion, but gamblers do. Now what give us a trading Edge: .Trends .Support and Resistance .Moving Averages .Divergence .Fibonacci Levels .Technical Indicators .Candle Stick Patterns .Harmonic Patterns .Consolidation Patterns .News Catalyst -By them self, technical signals are not reliable enough! but in the right combination...they give you a statistical Edge, turns to a profitable system!! If you are now talking to yourself, like man I use nearly all of that list but I keep losing money !? Lemme tell you why in the chart above! All what you have to do is to find out which one is your missing circle, and start working on it ! please chick out my related idea about risk management, and why you should always be a process-oriented not a results-oriented also if you can keep a trading journal, cuz it'll help you when things gets bad you'll get back to it and find out what you have done wrong cause without information you can't make improvements to your trading plan. P.s. if you want more about risk management and ways to limit your drawdowns in trading plz leave a comment ! Best of trading Forex brothas $$
Education
by YaseenG.Housari
13
Simple Trading Strategy > 10/20 SMASimple Trading Strategy > 10/20 SMA > Basic Education Chart: EURUSD Timeframe: Any Indicators: 10 SMA / 20 SMA 10 SMA = Faster 20 SMA = Slower If 10 SMA crosses 20 SMA to the downside = downtrend probable IF 10 SMA crosses 20 SMA to the upside = uptrend probable Very basic only ... be aware of false breaks/breaches, etc. This is a very simple strategy which can provide good results. Practice on Demo Account to test. * Personal analysis only. Please use your own rules and strategies prior to entering market. ** Forex trading involves HIGH RISK. Before entering a trade, carefully consider your objectives, financial resources and level of experience.
Education
by ALSM59
How all charts work. The case of USDCHF.When you analyse charts, what picture do you see? Is this the type of a candle or the position of a moving average?Perhaps you prefer Fibonacci analysis alone? But are these techniques explain what really happens on the market and could truly predict what is going to occur? Today we would like to show the true nature of every single chart and how forecast might be made without the use of indicators or tough mathematical calculations. To make that prediction you will need your eyes, open mind and understanding that each impulse is followed by another impulse after a period of correction. In order for that Fractology will use the daily chart of USDCHF. If we look at the chart we could clearly see three waves of correction (depicted with ABC) and an impulse (depicted with an arrow). The fact that the pair has broken out of a terminal structure on the final stages of wave C tells us that it will make an attempt to test the structure of a high degree. Correspondingly the break of that next structure will force the pair to take off. Most commonly this analysis is known as a wave patterns analysis. It stipulates that at every time charts work within some wave structures on the "matryoshka" principle, repeating itself.
Education
by AleksandrLombrozo
EURUSD weekly Fibonacci levels for long term view and trading EURUSD is adhering or responding to the Fibonacci levels all most all of the times. When trader wants to ride the trend this much information is enough to enter and exit trades. We are not trying to forecast the direction or the top/bottom. We are trying to identify important zones in which price may turn in Future. Price patterns like double top or bottoms or many other patterns can be used along with Fibonacci. I have mentioned few on chart. Going ahead we can look for shorting opportunity near level 1 of Fibonacci and long near 1.27. Price may stop and turn(as expected) or continue up or down movement from mentioned levels. To avoid such scenarios where price continues the move instead of reversing, we need to take help of price structure and candlestick patterns. Many traders msg me about how Fibonacci doesn't work, I recommend them all to stop using Fibonacci and use the tool in which you believe. As a trader our job is not to criticize any tool or method of analysis. Our target needs to be "designing trade plan which works for us". No tool works independently in my experience, we always need to club different tools and use them collectively.
Education
by dhananjay.d.joshi