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Fundamental Analysis

CHOCH vs BOS ‼️WHAT IS BOS ? BOS - break of strucuture. I will use market structure bullish or bearish to understand if the institutions are buying or selling a financial asset. To spot a bullish / bearish market structure we should see a higher highs and higher lows and viceversa, to spot the continuation of the bullish market structure we should see bullish price action above the last old high in the structure this is the BOS. BOS for me is a confirmation that price will go higher after the retracement and we are still in a bullish move WHAT IS CHOCH? CHOCH - change of character. Also known as reversal, when the price fails to make a new higher high or lower low, then the price broke the structure and continue in other direction.
Education
by Snick3rSD
What is Confluence❓✅ Confluence refers to any circumstance where you see multiple trade signals lining up on your charts and telling you to take a trade. Usually these are technical indicators, though sometimes they may be price patterns. It all depends on what you use to plan your trades. A lot of traders fill their charts with dozens of indicators for this reason. They want to find confluence — but oftentimes the result is conflicting signals. This can cause a lapse of confidence and a great deal of confusion. Some traders add more and more signals the less confident they get, and continue to make the problem worse for themselves. ✅ Confluence is very important to increase the chances of winning trades, a trader needs to have at least two factors of confluence to open a trade. When the confluence exists, the trader becomes more confident on his negotiations. ✅ The Factors Of Confluence Are: Higher Time Frame Analysis; Trade during London Open; Trade during New York Open; Refine Higher Time Frame key levels in Lower Time Frame entries; Combine setups; Trade during High Impact News Events. ✅ Refine HTF key levels in LTF entries or setups for confirmation that the HTF analysis will hold the price. HTF Key Levels Are: HTF Order Blocks; HTF Liquidity Pools; HTF Market Structure.
Education
by Snick3rSD
Market Structure Identification ✅Hello traders! I want to share with you some educational content. ✅ MARKET STRUCTURE . Today we will talk about market structure in the financial markets, market structure is basically the understading where the institutional traders/investors are positioned are they short or long on certain financial asset, it is very important to be positioned your trading opportunities with the trend as the saying says trend is your friend follow the trend when you are taking trades that are alligned with the strucutre you have a better probability of them closing in profit. ✅ Types of Market Structure Bearish Market Structure - institutions are positioned LONG, look only to enter long/buy trades, we are spotingt the bullish market strucutre if price is making higher highs (hh) and higher lows (hl) Bullish Market Structure - institutions are positioned SHORT, look only to enter short/sell trades, we are spoting the bearish market strucutre when price is making lower highs (lh) and lower lows (ll) Range Market Structure - the volumes on short/long trades are equall instiutions dont have a clear direction we are spoting this strucutre if we see price making equal highs and equal lows and is accumulating . I hope I was clear enough so you can understand this very important trading concept, remember its not in the number its in the quality of the trades and to have a better quality try to allign every trading idea with the actual structure
Education
by Snick3rSD
How to Trade Trends the Right WayHow to Trade Trends: A Comprehensive Guide Trend trading is a fundamental strategy for many traders, offering the potential for significant profits if executed correctly. However, mastering trend trading requires more than just following a single indicator. In this guide, we'll explore the intricacies of trend trading and how you can enhance your strategy for better results. 1. Utilize Multiple Indicators Relying on a single indicator to gauge market trends is like trying to understand a story by reading only one page. To get a comprehensive view of the market's direction, you should use multiple indicators. This approach can help you confirm trends and avoid false signals. Some popular indicators include moving averages, MACD (Moving Average Convergence Divergence), and RSI (Relative Strength Index). By analyzing these indicators together, you can get a clearer picture of the market's momentum and make more informed decisions. 2. Infinite Nature of Trends One of the most important concepts in trend trading is understanding that trends, by nature, are infinite until a clear trend change is identified. This understanding shifts the focus from setting arbitrary take profits (TPs) to managing trades with dynamic stop losses (SL). Instead of trying to predict where the trend will end, adjust your stop loss to subsequent swing highs or lows. This method allows you to stay in the trade as long as the trend continues, potentially capturing larger gains. 3. The Benefit of Longer-Term Trends While it may be tempting to trade on shorter time frames for quick profits, longer-term trends often offer more substantial rewards. A trend that exists on a daily or weekly chart is less likely to be disrupted by short-term volatility. Although these trades may require more patience, they tend to exit less frequently, allowing you to ride the trend for greater potential profits. Exiting a trend too early or trading on a system that changes signals often can result in missed opportunities and reduced profitability. 4. Strategies for Lower Timeframes For traders who prefer lower timeframes, the high volatility can make trend trading challenging. One strategy is to use the underlying trend from a higher timeframe as a bias and apply mean reversion strategies on the lower timeframe. This approach involves entering trades at a discount during an uptrend or at a premium during a downtrend. By aligning your trades with the overall trend direction, you can improve your chances of success even in a volatile market. Combine multiple indicators for a comprehensive analysis. Understand the infinite nature of trends and use dynamic SL. Focus on longer-term trends for greater profit potential. Use mean reversion strategies on lower timeframes with an overall trend bias. "Trade the trend until it ends." In conclusion, trading trends is more art than science, requiring a nuanced understanding of market indicators, patience, and discipline. By using multiple indicators, adjusting your approach based on the timeframe, and managing your trades dynamically, you can enhance your trend trading strategy for better results. Remember, the key to successful trend trading is not predicting the market's every move but rather managing your trades in a way that aligns with the overall market momentum.
Education
by AlgoAlpha
3
RUMINATION IN TRADING👋 Hello, Forex traders! Let's talk about rumination in trading. What is rumination? Rumination in trading is the process of going over previous trades and market situations in your head. Trying to understand what went wrong and to think of a better way of doing things. In "moderate doses" it is analysis. But when a person thinks about it all the time and in a negative way, analysis turns into mania and "self-beating" for mistakes made. Differences Between Rumination and Analysis ❓ Analysis is an essential part of learning to trade. It involves fixing all actions in a table editor, on paper, or uploading history from the platform. Traders analyze their best and worst moments, identify mistakes, changes in risk level, and successful trades. They also look for ways to optimize their trading system. Rumination, on the other hand, is obsessive thinking with an emphasis on the negative. It involves constant "chewing" of negative moments without searching for a solution. A stock or crypto you bought went down sharply, and all your thoughts are occupied with why it happened and how to fix it. Rumination in trading is the habit of endlessly worrying about and analyzing your trades, mistakes, losses or missed opportunities. It can lead to negative thinking, pessimism, depression, anxiety, impulsiveness and inactivity. Rumination prevents a trader from focusing on the present and the future and following his trading strategy and discipline. Rumination, instead of analyzing, improving and solving a problem, only makes the situation worse. Causes of Rumination in Trading 📋 • Lack of confidence. A trader who is insecure is constantly trying to look for mistakes in his previous trades to justify his failures. • Fear of failure. A trader who is afraid of losing money is constantly running through possible failure scenarios in his head to try to avoid them. • Striving for perfection. A trader who strives for perfection is constantly trying to find ways to improve his or her results, even if they are already quite consistent with expectations. Consequences of Rumination in Trading ⭕️ • Decreased trading efficiency. A trader who is constantly replaying past trades in his head cannot focus on the present and make the right decisions. • Loss of money. Rumination can lead to impulsive trading decisions that can lead to losses. • Mental Distress. Constantly running negative thoughts through your head can lead to stress, anxiety, and even depression. How To Avoid Rumination In Trading ✅ 1. Set limits on the time you spend analyzing past trades. 2. Focus on what you can control. 3. Develop positive thinking and self-esteem. 4. Determine your trading goals, rules, risks, and plans in advance and stick to them. 5. Keep a trading diary where you record your trades, results, mistakes, lessons learned, and emotions. 6. Limit the time spent analyzing charts, news, and forums. 7. Take time away from trading, pursue other interests, hobbies, friends, and family. 8. Find ways to relax and de-stress: meditation, sports, music, reading, etc. 9. Mentally prepare yourself for the worst-case scenario before entering a trade. 10. Every night before you go to bed, think of three good things that happened to you during the day. Example ✍️ You buy EURUSD with the expectation of growth. But there is a downside risk. Prepare yourself mentally for the fact that there are all the prerequisites for the fall of the pair, and you are ready to accept losses. If the price has reached the stop loss, take it with the thought "It is good that it is so, otherwise you could have lost even more" and go to rest. Ask yourself: what is the worst that can happen and how can I deal with it? In conclusion , rumination in trading can be detrimental to a trader's success. By understanding the differences between rumination and analysis, identifying causes, and implementing strategies to avoid rumination, we can improve our mental well-being and trading performance. Traders, If you liked this educational post🎓, give it a boost 🚀 and drop a comment
Education
by Lingrid
16
What is Spread in Trading | Everything You Need to Know Hey traders, It turned out that many newbie traders completely neglect spreads in their trading. In this post, we will discuss what is the market spread and how it can occasionally spoil a seemingly good trade. 💱No matter what financial instrument we trade, in order to buy the asset we need to have a counterpart that is willing to sell it to us and vice versa, if we want to sell the asset, we need to have someone to sell it to. The market provides a convenient exchange between buyers and sellers. The asset price is determined by a current supply and demand. However, even the most liquid markets have two prices: bid and ask. 🙋‍♂️ Ask price represents the lowest price the market participants are willing to sell the asset to you, while 🙇‍♂️ bid price shows the highest price the market participants are willing to buy the asset from you. Here is how bid and ask prices look like. Bid and ask price are almost never equal. The difference between them is called the spread . 📈The spread size depends on liquidity of the market. 📍Higher liquidity implies bigger trading volumes and greater number of market participants, making it easier for them to make an exchange. On such markets we see lower spreads. 📍From the other side, less liquid markets are categorized with low trading volumes, making it harder for the market participants to find a counterpart for the exchange. On such market, spreads are usually high. For example, current EURUSD price is 1.0249 / 1.0269. Bid price is 1.0249 - you open short position on that price. Ask price is 1.0269 - you open long position on that price. The spread is 2 pips. ❗️Spreads must always be considered in a calculation of a risk to reward ratio for the trade. For scalpers and day traders, higher than usual spread may spoil a seemingly good trade. Always check spreads before you open the trade. Check how the spread is displayed in the trading terminal. In 2020, for example, we saw unusually high spreads on Gold during UK/NY trading sessions. Spreads were so high that I did not manage to open a trade for a couple of days. Not considering spreads in such a situation would cost you a lot of money. Do you consider spread when you trade?🤓
OANDA:XAUUSDEducation
by VasilyTrader
7
Why Central Banks Buying Gold & Institutions Hedging the Yields?While many of us celebrate the stock markets reaching new highs, central banks worldwide are actively purchasing gold, and institutions are hedging into treasuries and yields. Interest rates are determined by the central banks whereas Yields are determined by the investors. If you choose to lend or borrow money over a longer period, such as 10 or 30 years, you would typically expect to earn or pay more interest for this extended duration loan contract. However, currently, we are witnessing an inversion of this relationship, known as the inverted yield curve, where borrowers are required to pay higher interest on their short-term loans, such as the 2-year yield we're observing, compared to their longer-term borrowing. 2 Year Yield Futures Ticker: 2YY Minimum fluctuation: 0.001 Index points (1/10th basis point per annum) = $1.00 Disclaimer: • What presented here is not a recommendation, please consult your licensed broker. • Our mission is to create lateral thinking skills for every investor and trader, knowing when to take a calculated risk with market uncertainty and a bolder risk when opportunity arises.
CBOT_MINI:2YY1!Education
by konhow
25
Crypto Regulations: How MiCA Will Affect EU TradersIn the rapidly evolving world of cryptocurrency, the European Union has taken a significant and important step forward with the introduction of the Markets in Crypto-Assets Regulation (MiCA). This groundbreaking regulatory framework marks a pivotal moment for the crypto market within the EU, promising to bring much-needed clarity and stability to an industry that has long been likened to the Wild West due to its volatility and lack of standardization. The European Union is a leader in creating legislation for emerging technologies. This became clear with the introduction of GDPR, which protects internet users’ personal data, the AI Act that aims to protect citizens of the EU from malpractice, such as cognitive manipulation of people and social scoring, and now - MiCA. Paving the way forward for others, the EU is evolving its digital legislation frameworks faster than other unions or countries. This article delves into how MiCA will reshape the landscape for EU traders, impacting everything - from the way they interact with crypto assets to the broader market dynamics they navigate daily. Why do we need regulations like MiCA? If there are no regulations, markets can run wild and experience giant increases, however when the fun is over and people lose money to fraud and even large-scale bankruptcy of exchanges - investors, especially institutional ones, will not dare place their money in crypto projects and companies. And since for investors, money is trust - the cryptocurrency market is doomed without proper regulation. On the flip side, extremely stringent and disorganized legislation can lead to the same outcome. Countries struggle with the abstract nature of cryptocurrencies, and many have expressed an outright desire to ban them, seeing as it is the easier option. That is why MiCA is a well-devised framework for others to follow - It is focused and comprehensive. Some may argue that cryptocurrencies are meant to be decentralized, unregulated and follow a laissez-faire approach. While this is possible, more so for some cryptocurrencies than others, there can be no growth in these markets as new projects need to have banking and investors behind them to realize their blockchain-based ideas. It is also unrealistic to think that such a clandestine financial system will never cross paths with the regular banking system. What exactly is MiCA? The inception of the Markets in Crypto-Assets Regulation (MiCA) is rooted in the European Union's recognition of the growing significance of cryptocurrencies and the associated risks in an unregulated environment. The primary catalyst for MiCA's development was the need for regulatory clarity in the burgeoning crypto market, which had been expanding rapidly without a standardized regulatory framework since the birth of Bitcoin in 2009. This lack of regulation posed risks such as fraud, market manipulation and financial instability. These concerns were heightened by incidents like the surge in initial coin offerings (ICOs), the capitulation of multiple large exchanges and the ironic instability of stable-coins. MiCA was proposed to provide a harmonized regulatory framework for crypto-assets that are not covered under existing EU financial legislation. The objective was to safeguard investors, maintain financial stability, and promote innovation within a secure and transparent environment. By introducing clear rules, MiCA aims to legitimize the crypto market, making it safer and more attractive for investors and consumers while mitigating the potential for financial crime and market manipulation. This move towards regulation reflects a global trend of governments and financial authorities worldwide striving to balance the benefits of innovation in the digital asset space with the need for consumer protection and market integrity. As such, MiCA represents a significant step by the EU in establishing a comprehensive regulatory regime for crypto-assets, setting a precedent that could influence global standards in cryptocurrency regulation. Key Points of MiCA MiCA introduces several key provisions that are set to transform the crypto-asset landscape in the European Union. The areas that are discussed and regulated the most are the areas where incidents have happened and people have lost their funds. It is important not to make the same mistakes as before. Exchanges & Brokerages One of the primary aspects of MiCA is the establishment of stringent authorization requirements for crypto-asset service providers. Under MiCA, any entity aiming to offer services related to crypto-assets, including trading, custody, or advisory services, must obtain authorization from one of the EU's national financial regulators. This process is designed to ensure that providers adhere to high standards of operational conduct, governance, and consumer protection outlined in the legislation. Crypto exchanges have gone bankrupt, been hacked or shut down abruptly in crypto’s short history. The aim of legislatures is to prevent these collapses or stop them in their tracks. Initial Public / Coin Offerings Another fundamental component of MiCA is the regulation of public offerings of crypto-assets. Companies intending to offer crypto-assets to the public are required to publish a detailed white paper. This document must provide clear, fair, and comprehensive information about the risks involved, ensuring that potential buyers are well-informed. The regulations aim to prevent misleading practices and enhance transparency in the market. Until now, many ICOs do publish white papers, however they can be purely fictional, written to trick the untrained eye into thinking the project is professionally done. Furthermore, this official process of submitting a white paper will ensure that the people behind the project are known. This will prevent people from faking their identities in order to anonymously scam their clients. Stablecoins MiCA also specifically addresses the regulation of stablecoins, which are categorized as either e-money tokens (EMTs) or asset-referenced tokens (ARTs). EMTs are stablecoins pegged to the value of a fiat currency, such as USDT, USDC and BUSD. ARTs are linked to other assets, such as WETH, WBTC. MiCA mandates that stablecoins must maintain adequate reserves and adhere to governance standards. Furthermore, there are stringent rules for stablecoins not pegged to EU currencies, including a cap on the number of transactions per day, aimed at preventing these assets from undermining the Euro. This approach to stablecoins is a response to concerns about their potential impact on financial stability and monetary policy. These concerns are justified, following the collapse of a few large market cap stable-coins during 2022. Through these provisions, MiCA aims to establish a secure and transparent environment for the trading and use of crypto-assets, ensuring that the rights of investors are protected while fostering innovation in the sector. Conclusion The introduction of MiCA by the European Union represents a watershed moment for the crypto-asset market. By establishing a harmonized regulatory framework, MiCA seeks to provide clarity, enhance market integrity, and protect investors, all while fostering an environment conducive to innovation. For EU traders, these regulations offer a more secure and transparent trading landscape, albeit with increased compliance obligations. The provisions on stablecoins, in particular, demonstrate a nuanced approach to different types of crypto-assets. As MiCA comes into full effect, its influence is expected to extend beyond the EU, potentially setting a precedent for global crypto-asset regulation. For traders and investors, staying informed and adapting to these regulatory changes will be key to navigating the evolving crypto market landscape.
Education
by sofex
How to trade the Fibonacci indicator in 2024Today, we’ll start with what Fibonacci is and how to use it to spot significant market turning points. Let’s start with... A short story about Fibonacci In 13th century Italy, lived a man named Leonardo Pisano – one of the greatest mathematicians of all time. Leonardo (also known as Fibonacci), learnt all about Arabic and Indian mathematics during his travels in North Africa and around the Mediterranean regions. Each time he travelled to a new place, he kept noticing a consistent pattern that repeated itself throughout nature. The sequence he defined was as follows. 0, 1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144… Basically, all you do is take the last two numbers and add them up to get the next number. 0 + 1 = 1 1 + 1 = 2 1 + 2 = 3 2 + 3 = 5 3 + 5 = 8 8 + 5 = 13 And so on… Fibonacci first contrived this pattern through a pair of breeding rabbits but he then saw this pattern throughout nature - in the breeding of honeybees , the shape of seashells as well as plants. This sequence also applies to trading and investing charts and is called the Fibonacci Retracement indicator. The Fibonacci Retracement indicator is used to help identify possible support and resistance levels for any market. The idea is all high liquid markets tend to move, to and retrace back, to certain levels after a big price move. The indicator is used to calculate the ratios and percentages using the Fibonacci sequence. Let’s look at an example with the South African JSE ALSI 40. Fibonacci on the JSE ALSI 40 Looking at the above daily chart of the JSE ALSI 40, you can see the index has fallen from a Swing High point of (100%) at 70,522 down to a Swing Low point (0%) to 65,386. On your platform, when you add the Fibonacci Retracement tool onto your chart, you'll drag it from the swing high to the swing low price of the uptrend to see six main horizontal fib lines present themselves: Fib line #1: 100% (Swing high) Fib line #2: 61.8% Fib line #3: 50% Fib line #4: 38.2% Fib line #5: 23.6% Fib line #6: 0% (Swing low) Traders use these lines to establish and identify supports (floor) and resistances (ceiling) levels. And with these levels you’ll be able to spot good entry, stop loss and take profit price levels. Once you draw the Swing High and Swing Low on the JSE ALSI 40, the Fibonacci lines will be plotted on the chart. You would also have seen the market then went to one of the high points at 61.80% at 68,560. The price then retraced back to the 23.6% level at 66,598. So you can see where we are going with this. As a reversal trader, you could have sold (gone short) the index around 68,560 and held it until it hit the 66,598 line at 23/6%. That’s where you would have banked a gain just by waiting for the market to bounce off a fib line. That’s a good introduction and a different way for you to trade and use the Fibonacci Retracement tool with your trading in 2024. Let me know if this was helpful!
TVC:SA40Education
by Timonrosso
1
Top-Down Analysis (The CORRECT Approach!)In this video I go through how to effectively do a top-down analysis, and avoid common mistakes. This can apply to any type of trading methodology, but here the focus will be on ICT’s liquidity and inefficiency concepts. This topic is important to traders who are keen on improving their win-rate and catching those higher RR trades. Whilst those things don’t define a successful trader, only consistent profitability and sound risk management do, I believe an effective top-down approach to framing trades is a worthwhile endeavor. Better trade setups give you less stress, more profits, and more freedom of time. What is a "top-down analysis"? It is basically doing your analysis on a higher timeframe to get in line with where you or your strategy is showing price is likely moving to, then on a lower timeframe to wait for your trade setup to form, and then either entering on that timeframe or going to an even lower timeframe for an entry signal. For example, if the weekly chart is bearish, and you see a bullish candle on the hourly chart, you may be fooled into trading in the wrong direction. For the highest probability, you need to be in sync with the higher timeframe. My approach is split into 3 parts: 1. I have my BIAS which is built on the monthly, weekly, and daily timeframe. This helps me determine the direction I want to trade in. If my analysis is bullish, I want to look for longs, and vice versa for shorts. 2. Then I have my NARRATIVE, aka my ‘story’ of how my setup may form on a lower timeframe, usually the 1-4h timeframe. For example, I may be looking for a specific pool of liquidity to be swept at a certain time of the day. 3. Thirdly, I have my CONFIRMATION, which is usually based on the 5-15m timeframe. I hope you found this video insightful and that it helps enhance your trading. If you need clarification about the content, or you are still struggling with finding your groove as a trader and need personal guidance or mentorship, feel free to reach out to me via TradingView’s private message or on X (formerly known as Twitter). Til next time, happy trading. - R2F
Education
by Road_2_Funded
SWAP ZONES IN FOREX MARKET👋 Hello, Forex traders! In a market situation, swap zones in trading are formed as a result of a change in market direction. When the trend changes, the price often returns to the previous support or resistance line. This is due to the fact that participants often use the lines as reference points for trading decisions. Swap zones can be used by traders to identify optimal entry-exit points for trades. For example, a trader can open a long position when the price is approaching support or a short position when the price is heading towards resistance. What is a Swap Zone? 🧐 Swap zone in trading is a price level that was previously a support and then became a resistance, or vice versa. It represents a part of the chart where the price pauses or rolls back. It is formed as a result of a change in the trend direction. Swap zone is easy to use to identify reversal points. For example, if a price is in a rising market and is pulling back to support, it is a signal that the trend may resume. In order to increase the accuracy of swap zone, it is important to use it in combination with other tools of technical analysis. Swap zone is suitable for deciding whether to open a position. For example, if a price is in a sideways movement and approaches swap zone resistance, it is a signal that the price may break through the level and start a new trend. We can open a long position if the price breaks the resistance, or a short position if the support level is broken. The assistant is useful in various trading systems, including price action and volume analysis systems. In price action strategies, it is suitable for determining potential support and resistance, and in volume analysis it is suitable for determining trend strength. Here Are A Few Strategies To Give You An Example ✍️ Level Breakout. It consists in entering the trade after the price breaks through the swap zone. This is a signal that the trend will continue, you can open a long or short position. Rebound from the level. Entry into the trade after the price bounces off the level. For example, if the price is in a falling market and bounces off the resistance swap zone, this is a reversal signal and you can open a short position. Double Test Level. Opening a position after the price tests the swap zone twice and you can open a short or long position. Pullback after a level breakout. Entry after the price rolls back after a breakdown of the level. It can be a sign that the trend is slowing down. When using the tool, it is important to consider the market direction, trend strength and trading volume. Advantages And Disadvantages Of Swap Zone 📈📉 Before using a pattern, it is important to consider its strengths and weaknesses. Pros: • An effective tool for identifying support and resistance, as well as moments of opening and closing a position; • use together with other tools of technical analysis to improve trading accuracy; • easy to use and understand; • possibility of earning with different tools and in many strategies. Cons: • They are not completely reliable and the market can go in a different direction; • It can be influenced by other factors: news, fundamental data or changes in the mood of market participants; • They do not always provide effectiveness. In summary, swap zones are perhaps the simplest and most effective tool in a trader's arsenal. Levels are the most reliable piece of information you could possibly get about an asset and its price. No amount of analysis will ever tell you more truth than levels can. Traders, If you liked this educational post🎓, give it a boost 🚀 and drop a comment
Education
by Lingrid
1
Getting Paid? With the USD/TRY Carry Trade?The USD/TRY has one of the highest Roll Over Interest out there should you choose to take on this highly volatile pair. It isn't so much that it is volatile, it has to do more with price just moves one direction, and that is up. The way we want to go is down (short) or at least sideways (ranging). Why is this interesting? It is because the Rollover Interest for going short stands at a whopping annualized rate of 28.94%. With 1:4 Margin Requirement for trading a standard lot on the TRY (based off the broker I use), $25,000 could earn me $28,940 yearly, which would be a staggering 115% return at the end of the year. Compounded, I would be a multimillionaire in no time, Buying up yachts, private jets, gourmet food, luxury cars, a pony that shoots lasers, Space X Starship, and countless other items. But hold up, is there a downside or something that makes this too good to be true? Yes, there is price movement as well as changes in interest rates as well as capital in the account. Having only $25,000 in the account, going full throttle and placing one huge position is sure to activate a margin call within seconds (as price can move thousands of pips against you quickly) and/or cause you to lose more than you put in. Now, we don't want that. You would need to have at least double the amount in the account in order to allow for price movement. The return would be halved, but making over 50% yearly isn't too bad either, is it? With price movement, the USD/TRY (I just call it the TRY), price moved higher over 57,000 pips in 2022, and over 100,000 pips in 2023; that is $18,240 and $32,000 respectively. Interest have just reached 45%, so things definitely would not have been good. Now, with funds in your account, not to many of us have $25,000 lying around to utilize in the markets, nor do we want to just tie up $25,000 into something really risky. Yet if used correctly and price does stabilize, then the TRY carry trade could payout (similar to the EUR/HUF). What could be done to reduce the risk? For starters, position sizing. Don't use the full force of your account and go "YOLO." Manage expectations. With a $25,000 account size, only getting into a position at around $3,750 (which is about 15% of the account used and a 15k position), would be around $3,650 return, which would be about a 14.6% return (still not bad. How many people can do this). If things go sour and price does move up at the end the year by 100,000 pips against you ($0.05 move per pip), that would be -$5,000 reduced to $1,350 because of the gained rollover interest (which would be only a 5% hit to your account instead of 20%). Putting some hedges in could also reduce some of the risk. Additionally, research and analysis, this could push you to make a more informative speculation on if getting into the pair is a good idea. Furthermore, to really ensure you don't lose any money, is to not get into the pair at all. For myself, I am utilizing around 41% of my Forex account in this pair, about 14% of my overall accounts. There are hedges in place to reduce the impact of price moving against me as well as my position being small enough to not cause any traumatic moves, even if price moves 100,000 pips against me (of course don't want that to happen). The decision is also made to stay in this pair for the long term or until there is some major changes. There is additional funds in reserves if needed, if things don't go well, in order to put another plan into play to get out of my positions in an orderly fashion. You all have some great trading out there.
Education
by DollarSaenz
2
HARMONIC PATTERN BUTTERFLY ✴️ Harmonic patterns are prevalent in consolidation markets. These patterns can be used as additional confirmation to enter a trade. Today let's study the Butterfly Pattern. The Butterfly Pattern in trading is a 5-point trend reversal pattern, which consists of two corrections that form the shape of a butterfly. The pattern can be formed on any timeframe, but most often occurs on daily and hourly charts. It has high accuracy, but like any other indicator, it does not guarantee profit. To increase the probability of success, it is necessary to use the pattern in combination with other indicators and methods of market analysis. ✴️ WHAT IS A BUTTERFLY PATTERN? Butterfly pattern in trading is a reversal trend pattern, which is formed from two corrections with the formation of a corresponding shape. It is used to determine a possible market reversal. The formation was first described by Harold Gartley in his book New Wave Theory (1932). He is an American trader and analyst who developed several harmonic patterns, including the Butterfly, Delta and Harmonic Triangle. The Butterfly pattern in trading can appear on any timeframe, but is often caught on daily and hourly charts. For the formation of the pattern, it is necessary that the following point conditions are met: X - the start of an bullish or bearish movement; A - the end of a bullish or bearish movement and it's a start of correction; B - maximum decrease or increase of the price during the market change; 61.8 - 0.786 retracement. C - end of correction (retest of the A point area) and start of a new movement; as long as it does not exceed the A point. D - 127% - 161.8% fibo extension of the XA distance. Gartley's butterfly in trading can have two directions. To determine the Butterfly pattern, you need to find all five points of the formation. X and C are the beginning and the end of the basic movement, and A and B are the top and the lowest point of the correction. Point D is at 127% of the XA distance. If all five elements are present and meet the specified conditions, we can talk about a probable trend reversal. At the same time, it is desirable to use an indicator that would confirm the entry. The butterfly shape does not always have to be perfect. Sometimes the AB correction can be steeper than the BC. The formation conditions are not always perfectly met. Often the XA distance can be slightly more or less than 127%. Stop-loss can be placed not only below point D. The Butterfly pattern is considered a powerful tool that helps traders improve results. But it is important to use it in combination with other market analysis techniques to increase the probability of success. ✴️ HOW TO TRADE A BULLISH BUTTERFLY This is a 5-wave trend reversal pattern that represents two corrections that form a butterfly shape. Features of the design by points: X - start of a rising movement; A - end of growth and correction; B - fall of the price during the correction; C - the end of the process and the start of a new movement; D - 127% - distance of the XA. Entry into the trade is made at the level of point D, and stop-loss is set below point D. The target price is within A-D distance. ✴️ HOW TO TRADE THE BEARISH BUTTERFLY Exit is made after reaching the target price or when trend reversal signals appear. This is a 5-wave market reversal pattern that represents two corrections in the shape of a butterfly. To create it, the following requirements must be met: X - start of a falling movement; A - end of growth and correction; B - increase of the price during the correction; C - the end of the process and the start of a new movement; D - 127% - XA distance. The entry in the bearish butterfly is made at the level of point D, and stop-loss is set above point D. The target price for the pattern is within the Fibonacci levels 38.2% and 61.8% of the A-D distance. Exit is performed after reaching the target price or when there are signals of trend reversal. In both cases discussed above, it is important to combine the pattern with other methods of market analysis, such support and resistance levels, to increase success. You should not enter a trade if the pattern does not meet all conditions. Set a stop loss at a level that will limit losses in case of a failed trade. Also, you can move stop loss to break even once the price hits 38.2% Fibonacci level. ✴️ CONCLUSION The experience of using the Butterfly Pattern has shown that it is quite accurate when trading in a sideways movement or opening trades with a trend. It can be used on any timeframe, but it is more effective in combination with other methods of market analysis. At the same time, the pattern does not always correspond to the conditions and can give false signals. For this reason, it is recommended to check it with the help of indicators. Harmonic patterns should follow the basics of technical analysis. In the first place, of course, is the market structure.
Education
by DeGRAM
2
LEARN THE MOST IMPORTANT FOREX FUNDAMENTALS 📰 Even though I am a pure technician and I rely only on technical analysis when I trade, we can not deny the fact that fundamentals are the main driver of the financial markets. In this post, we will discuss the most important fundamentals that affect forex market. You can check coming fundamental news on TradingView in the economic calendar. The calendar button on the right side will display the coming news. Click "only high importance" button and the system will display only the most important news. Here are the most important fundamental releases that you should pay close attention to: 📍Unemployment rate. Unemployment rate reflects the percentage of people without a job in a selected country or region. Rising unemployment rate usually signifies an unhealthy state of the economy and negatively affects the currency strength. 📍Housing prices. Housing prices reflect people's demand for housing. Rising rate reflects a healthy state of the economy, strengthening purchasing power of the individuals and their confidence in the future. Growing demand for housing is considered to be one of the most important drivers in the economy. 📍Inflation. Inflation reflects the purchasing power of a currency. It is usually measured by evaluation of the price of the selected basket of goods or services over some period. High inflation is usually the primary indicator of the weakness of the currency and the unhealthy state of the economy. 📍Monetary policy. Monetary policy is the actions of central banks related to money supply in the economy. There are two main levers: interests rates and bank reserve requirements. Higher interest rates suppress the economy, making the currency stronger. Lower interests rates increase the money supply, making the economy grow but devaluing the national currency. 📍Political discourse. Political discourse is the social, economical and geopolitical policies of the national government. Political ideology determines the set of priorities for the ruling party that directly impacts the state of the economy. 📍Payrolls and earnings. Payroll reports reflect the dynamic of the creation of new jobs by the economy, while average earnings show the increase or decrease of the earnings of the individuals. Growing earnings and payrolls positively affect the value of a national currency and signify the expansion of the economy. Pay closes attention to these fundamentals and monitor how the market reacts to that data. What fundamentals do you consider to be the most important? ❤️Please, support my work with like, thank you!❤️
FOREXCOM:XAUUSDEducation
by VasilyTrader
1
HOW-TO use Bitcoin 5A Strategy@LilibtcIn our long-term strategy, we have deeply explored the key factors influencing the price of Bitcoin. By precisely calculating the correlation between these factors and the price of Bitcoin, we found that they are closely linked to the value of Bitcoin. To more effectively predict the fair price of Bitcoin, we have built a predictive model and adjusted our investment strategy accordingly based on this model. In practice, the prediction results of this model correspond quite high with actual values, fully demonstrating its reliability in predicting price fluctuations. When the future is uncertain and the outlook is unclear, people often choose to hold back and avoid risks, or even abandon their original plans. However, the prediction of Bitcoin is full of challenges, but we have taken the first step in exploring. Table of contents: Guide Step 1: Identify the factors that have the greatest impact on Bitcoin price Step 2: Build a Bitcoin price prediction model Step 3: Find indicators for warning of bear market bottoms and bull market tops Step 4: Develop a Bitcoin 5A strategy Step 5: Verify the performance of the Bitcoin 5A strategy Opportunities Usage Restrictions Guide: 1. On the main interface, modify the code, find the BTCUSD trading pair, and select the BITSTAMP exchange for trading. 2. Set the time period to the daily chart. 3. Select a logarithmic chart in the chart type to better identify price trends. 4. In the strategy settings, adjust the options according to personal needs, including language, display indicators, display strategies, display performance, display optimizations, sell alerts, buy prompts, opening days, backtesting start year, backtesting start month, and backtesting start date. Step 1: Identify the factors that have the greatest impact on Bitcoin price Correlation Coefficient: A mathematical concept for measuring influence In order to predict the price trend of Bitcoin, we need to delve into the factors that have the greatest impact on its price. These factors or variables can be expressed in mathematical or statistical correlation coefficients. The correlation coefficient is an indicator of the degree of association between two variables, ranging from -1 to 1. A value of 1 indicates a perfect positive correlation, while a value of -1 indicates a perfect negative correlation. For example, if the price of corn rises, the price of live pigs usually rises accordingly, because corn is the main feed source for pig breeding. In this case, the correlation coefficient between corn and live pig prices is approximately 0.3. This means that corn is a factor affecting the price of live pigs. On the other hand, if a shooter's performance improves while another shooter's performance deteriorates due to increased psychological pressure, we can say that the former is a factor affecting the latter's performance. Therefore, in order to identify the factors that have the greatest impact on the price of Bitcoin, we need to find the factors with the highest correlation coefficients with the price of Bitcoin. If, through the analysis of the correlation between the price of Bitcoin and the data on the chain, we find that a certain data factor on the chain has the highest correlation coefficient with the price of Bitcoin, then this data factor on the chain can be identified as the factor that has the greatest impact on the price of Bitcoin. Through calculation, we found that the 🔵number of Bitcoin blocks is one of the factors that has the greatest impact on the price of Bitcoin. From historical data, it can be clearly seen that the growth rate of the 🔵number of Bitcoin blocks is basically consistent with the movement direction of the price of Bitcoin. By analyzing the past ten years of data, we obtained a daily correlation coefficient of 0.93 between the number of Bitcoin blocks and the price of Bitcoin. Step 2: Build a Bitcoin price prediction model Predictive Model: What formula is used to predict the price of Bitcoin? Among various prediction models, the linear function is the preferred model due to its high accuracy. Take the standard weight as an example, its linear function graph is a straight line, which is why we choose the linear function model. However, the growth rate of the price of Bitcoin and the number of blocks is extremely fast, which does not conform to the characteristics of the linear function. Therefore, in order to make them more in line with the characteristics of the linear function, we first take the logarithm of both. By observing the logarithmic graph of the price of Bitcoin and the number of blocks, we can find that after the logarithm transformation, the two are more in line with the characteristics of the linear function. Based on this feature, we choose the linear regression model to establish the prediction model. From the graph below, we can see that the actual red and green K-line fluctuates around the predicted blue and 🟢green line. These predicted values are based on fundamental factors of Bitcoin, which support its value and reflect its reasonable value. This picture is consistent with the theory proposed by Marx in "Das Kapital" that "prices fluctuate around values." The predicted logarithm of the market cap of Bitcoin is calculated through the model. The specific calculation formula of the Bitcoin price prediction value is as follows: btc_predicted_marketcap = math.exp(btc_predicted_marketcap_log) btc_predicted_price = btc_predicted_marketcap / btc_supply Step 3: Find indicators for early warning of bear market bottoms and bull market tops Warning Indicator: How to Determine Whether the Bitcoin Price has Reached the Bear Market Bottom or the Bull Market Top? By observing the Bitcoin price logarithmic prediction chart mentioned above, we notice that the actual price often falls below the predicted value at the bottom of a bear market; during the peak of a bull market, the actual price exceeds the predicted price. This pattern indicates that the deviation between the actual price and the predicted price can serve as an early warning signal. When the 🟠Bitcoin price deviation is very low, as shown by the chart with 🟩green background, it usually means that we are at the bottom of the bear market; Conversely, when the 🟠Bitcoin price deviation is very high, the chart with a 🟥red background indicates that we are at the peak of the bull market. This pattern has been validated through six bull and bear markets, and the deviation value indeed serves as an early warning signal, which can be used as an important reference for us to judge market trends. Step 4: Bitcoin 5A Strategy Formulation Strategy: When to buy or sell, and how many to choose? We introduce the Bitcoin 5A strategy. This strategy requires us to generate trading signals based on the critical values of the warning indicators, simulate the trades, and collect performance data for evaluation. In the Bitcoin 5A strategy, there are three key parameters: buying warning indicator, batch trading days, and selling warning indicator. Batch trading days are set to ensure that we can make purchases in batches after the trading signal is sent, thus buying at a lower price, selling at a higher price, and reducing the trading impact cost. In order to find the optimal warning indicator critical value and batch trading days, we need to adjust these parameters repeatedly and perform backtesting. Backtesting is a method established by observing historical data, which can help us better understand market trends and trading opportunities. Specifically, we can find the key trading points by watching the Bitcoin price log and the Bitcoin price deviation chart. For example, on August 25, 2015, the 🟠Bitcoin price deviation was at its lowest value of -1.11; on December 17, 2017, the 🟠Bitcoin price deviation was at its highest value at the time, 1.69; on March 16, 2020, the 🟠Bitcoin price deviation was at its lowest value at the time, -0.91; on March 13, 2021, the 🟠Bitcoin price deviation was at its highest value at the time, 1.1; on December 31, 2022, the 🟠Bitcoin price deviation was at its lowest value at the time, -1. To ensure that all five key trading points generate trading signals, we set the warning indicator Bitcoin price deviation to the larger of the three lowest values, -0.9, and the smallest of the two highest values, 1. Then, we buy when the warning indicator Bitcoin price deviation is below -0.9, and sell when it is above 1. In addition, we set the batch trading days as 25 days to implement a strategy that averages purchases and sales. Within these 25 days, we will invest all funds into the market evenly, buying once a day. At the same time, we also sell positions at the same pace, selling once a day. Adjusting the threshold: a key step to optimizing trading strategy Adjusting the threshold is an indispensable step for better performance. Here are some suggestions for adjusting the batch trading days and critical values of warning indicators: • Batch trading days: Try different days like 25 to see how it affects overall performance. • Buy and sell critical values for warning indicators: iteratively fine-tune the buy threshold value of -0.9 and the sell threshold value of 1 exhaustively to find the best combination of threshold values. Through such careful adjustments, we may find an optimized approach with a lower maximum drawdown rate (e.g., 11%) and a higher cumulative return rate for closed trades (e.g., 474 times). The chart below is a backtest optimization chart for the Bitcoin 5A strategy, providing an intuitive display of strategy adjustments and optimizations. In this way, we can better grasp market trends and trading opportunities, thereby achieving a more robust and efficient trading strategy. Step 5: Validating the performance of the Bitcoin 5A Strategy Model accuracy validation: How to judge the accuracy of the Bitcoin price model? The accuracy of the model is represented by the coefficient of determination R square, which reflects the degree of match between the predicted value and the actual value. I divided all the historical data from August 18, 2015 into two groups, and used the data from August 18, 2011 to August 18, 2015 as training data to generate the model. The calculation result shows that the coefficient of determination R squared during the 2011-2015 training period is as high as 0.81, which shows that the accuracy of this model is quite high. From the Bitcoin price logarithmic prediction chart in the figure below, we can see that the deviation between the predicted value and the actual value is not far, which means that most of the predicted values can explain the actual value well. The calculation formula for the coefficient of determination R square is as follows: residual = btc_close_log - btc_predicted_price_log residual_square = residual * residual train_residual_square_sum = math.sum(residual_square, train_days) train_mse = train_residual_square_sum / train_days train_r2 = 1 - train_mse / ta.variance(btc_close_log, train_days) Model reliability verification: How to affirm the reliability of the Bitcoin price model when new data is available? Model reliability is achieved through model verification. I set the last day of the training period to February 2, 2024 as the "verification group" and used it as verification data to verify the reliability of the model. This means that after generating the model if there is new data, I will use these new data together with the model for prediction, and then evaluate the accuracy of the model. If the coefficient of determination when using verification data is close to the previous training one and both remain at a high level, then we can consider this model as reliable. The coefficient of determination calculated from the validation period data and model prediction results is as high as 0.83, which is close to the previous 0.81, further proving the reliability of this model. Performance evaluation: How to accurately evaluate historical backtesting results? After detailed strategy testing, to ensure the accuracy and reliability of the results, we need to carry out a detailed performance evaluation on the backtest results. The key evaluation indices include: • Net value curve: As shown in the rose line, it intuitively reflects the growth of the account net value. By observing the net value curve, we can understand the overall performance and profitability of the strategy. The basic attributes of this strategy are as follows: Trading range: 2015-8-19—2024-2-18, backtest range: 2011-8-18—2024-2-18 Initial capital: 1000USD, order size: 1 contract, pyramid: 50 orders, commission rate: 0.2%, slippage: 20 markers. In the strategy tester overview chart, we also obtained the following key data: • Net profit rate of closed trades: as high as 474 times, far exceeding the benchmark, as shown in the strategy tester performance summary chart, Bitcoin buys and holds 210 times. • Number of closed trades and winning percentage: 100 trades were all profitable, showing the stability and reliability of the strategy. • Drawdown rate & win-loose ratio: The maximum drawdown rate is only 11%, far lower than Bitcoin's 78%. Profit factor, or win-loose ratio, reached 500, further proving the advantage of the strategy. Through these detailed evaluations, we can see clearly the excellent balance between risk and return of the Bitcoin 5A strategy. Opportunity: Capturing factor changes Changes in factors provide us with valuable trading opportunities. The 🟠orange line in the chart below represents the factor indicator when its value on February 20, 2024 is -0.32, which is greater than the threshold of -0.9. This could be a signal worth paying attention to. Opportunities like this do not come up often, so we need to stay alert and act fast. Usage Restrictions: Strategy Application in Specific Situations Please note that this strategy is designed specifically for Bitcoin and should not be applied to other assets or markets without authorization. In actual operations, we should make careful decisions according to our risk tolerance and investment goals.
BITSTAMP:BTCUSDEducation
by lilibtc
3
Why the Bitcoin Halving Historically Increases PriceThe bitcoin halving, which occurs every four years, is encoded into Bitcoin itself. Its purpose is to cut in half the amount of Bitcoin that is rewarded for every block that is mined, meaning you must double the processing power every four years to mine the same amount of Bitcoin. (A block reward refers to the number of bitcoins you get if you successfully mine a block of the currency . Investopedia 2023 ) This means that it becomes twice as hard for bitcoin miners to mine the same amount of bitcoin they were mining four years earlier with the same hardware. This creates what is known as a drop in supply or supply shock, where market demand either stays the same or increases, and the price of bitcoin must increase to meet the demand. If the demand stays the same or increases, the price still has to increase because the supply of bitcoin being mined daily is half what it was in the previous four years. There are fewer coins to buy, so the market must compete by paying higher prices. Because this event is exponential, eventually hardware will not be able to keep up with the halving if miners want to be profitable. This may seem like an oversimplification of the most basic economic principles. However, that is what is fundamentally encoded into bitcoin, which guarantees an increase in price by cutting supply every four years (guaranteed only if demand stays the same or increases). That is why bitcoin halving is referred to as a market-moving event, because not only historically has it proven to increase prices and cut supply, but fundamentally it has too. Now let’s look at a real-life example for comparison. Gold does have real-world use in technology and jewelry. However, its main value and use are as a store of value. Most gold is bought and accumulated because it will retain its value, which is the same use case as bitcoin. What do you think would happen if the entire gold production market was slashed in half overnight and this process was repeated every four years? The price of gold would increase exponentially as the finite resource becomes more and more scarce because it is harder to mine. Now apply the same logic to bitcoin, and hopefully you will begin to see the picture. The next bitcoin has just under 60 days coming up in mid-April 2024, so mark your calendars.
COINBASE:BTCUSDEducation
by altsandislands
Our Strategy For "The Leap"Hey guys! Today, we explore 'The Leap', and our strategy for the competition. It's easy to register if you haven't done so already. In this video, we cover; 1.) DIRECTIONAL BIAS 2.) WHERE TO TRADE 3.) WHERE TO RISK 4.) POSITION MANAGEMENT for the strategy we'll be using. It's a simple breakout strategy we're going to bring to a lower timeframe, so we can get enough trades in before the competition expires. Good luck to all, we look forward to competing with you! Want more high-quality trade ideas? Follow us below. ⬇️⬇️
AMEX:SPYEducation
by PropNotes
17
The most subjective facet of my decision-making systemIn the previous publication I started talking about my decision-making system. I use it when investing in stocks. This system allows me to answer three questions: - which stocks to choose? - at what price to make a trade? - and in what quantity? In this post, I will continue to answer the question Which stocks to pick? and tell you about another facet of my crystal. As you can see, my decision-making system is quite formalized. What do I mean? It has clear criteria for which a company must be checked before investing in its stocks. If we go deeper into this idea, we can say that the state of affairs in any public company can be assessed using numbers from its statements and stock exchange prices for its stocks. All this can be visualized, put into a form that is readable for the investor, and accelerate the decision-making process many times over. However, there is an area with information that hovers around the companies, directly or indirectly influences it, but is poorly formalized: this is News . News can be called a message related to a company and distributed through its website, media, and social networks. This message triggers an almost knee-jerk reaction among stock investors (and traders). They will try to interpret the information received, make a forecast, and in some cases even make a trade. It is for this reason that the moment the news is published is often accompanied by a sharp movement in the stock price and an increase in trading volume. The order book now has a lot more players than before. These are traders excited by the news, confident of what will happen next. Here I can’t help but recall the allegory about Crazy Mister Market from Benjamin Graham. It presents the market as a partner who is constantly knocking on your door and offering you crazy ideas (stock prices). Where does this mister get his madness from? My answer is simple — from the news. Despite this, I cannot help but pay attention to the news, I cannot help but interpret it, to build predictions in my head. This happens reflexively, as a reaction to boiling water hitting my skin. However, will I make a trade under the influence of this information? We'll talk about this at the end of the post. Let's find out what news is available and where to find it. In this publication, I will only consider matters relevant to the stock market. That is information that can directly or indirectly affect the state of affairs in the companies. As I work, I divide the news flow into two categories: macro-event and corp-event . A macro-event is something that can indirectly impact the state of affairs in a company since it impacts the external environment in which it lives. For example: 1. In the third quarter, US GDP grew by 4.9% year-on-year, which was better than expected (*). GDP Dynamics are a general economic indicator of economic growth in a particular country. This event only indirectly affects the business of the US companies. In other words, a company can be unprofitable even if the GDP in the country of its business is growing. (*) In the news, you will often see the following wording: - better than expected - worse than expected - as expected These are significant clarifications since it is believed that the exchange price already considers expectations for future events. Therefore, the coincidence with expectations will most likely be perceived calmly by market participants. Conversely, price fluctuations can be significant if the news can be qualified as a “surprise”. 2. The EPA is setting rules for a proposed “methane fee” on waste generated by oil and gas companies. This news also refers to macro events, as it impacts an entire industry: the oil and gas business. Moreover, please note that methane fee is only suggested. That is, it is not at all a fact that it will ultimately be implemented. Unlike macro events, a corp-event directly affects the state of affairs in the companies. Let's look at some of them. For example: 3. Hilton's (HLT) 3rd quarter Profit was in line with revenue forecasts. The news contains information about Hilton's financial results for the 3rd quarter. Of course, this directly impacts investors’ assessment of the company's prospects, and therefore the volume of investment in it. 4. Devastating wildfires have forced California's largest utility, Pacific Gas and Electric Company, to plan the sale of gas assets. Based on the news headline, we can conclude that the company is considering selling a significant part of its business (since the word “gas” even appears in the company name) to compensate for the damage from the devastating fires. Of course, this directly points to the difficult situation in the companies. Well, we figured out which news is considered a macro-event and which is a corporate event. Now let's find them where we need to. First, let's look at the event calendars that are available on TradingView. They are convenient because they inform us in advance what event to expect on the date in question. Let's start with the ⁣Economic calendar . You can find it in the main TradingView Products menu (Products -> Economic calendar ). This calendar shows upcoming publications of key macroeconomic indicators such as GDP, ⁣ interest rate, unemployment, and inflation. It will also reflect national events — for example, presidential elections. Thus, you will only see macro events in it. Click on globe and select the country you are interested in, a group of countries, or the whole world: this way you will filter events by geography. If you are interested in tracking only important events, there is a special button for this High importance . There is also a three-column importance indicator next to each event. If all are shaded, the event is of maximum importance. You can expand any event, read information about it, view statistics, and even add it to your personal calendar. In terms of importance, the higher the importance of the event, the stronger the market reaction may be after the information is released. Furthermore, the strength of the reaction will depend on how much reality diverges from expectations for this event (with the forecast). Please note that the current value published is published to the left of the forecast, and the value for the previous period is published to the right. This allows you to evaluate the released metric over time. So, my standard set of filters for the economic calendar is: - Geography: all over the world; - High importance; - This week; - All categories. The economic calendar has been set up. There is another calendar on TradingView: this is Earnings calendar . It is located in the interface for working with Supercharts and, of course, is intended for analyzing corporate events. Once you go to the chart, click on the calendar icon in the menu on the right, and the events panel will open in front of you. The Earnings calendar will contain the names of the companies, their next reporting date, and analysts' estimates of earnings per share: EPS. In its meaning, this estimate is an average expectation or forecast. Therefore, any strong discrepancy between current data and the forecast value can greatly change the value of the company's stocks. By the way, you can check this simply by clicking on the company's name in the calendar: the window with the stock price chart will update instantly. The released earnings per share value can be viewed both on the chart itself and in the company's information (the top menu button on the right). The current value will be marked with either a red circle (below the forecast) or a green circle (above the forecast). The gray circle indicates the forecast itself. Calendars are convenient because they present us with the main essence of the news in a compressed, digitized form. The description of such news is not as important as the value of the key indicator. However, if you want to read classic text news about a related company, simply click on the lightning bolt icon on your chart. You can also find news grouped by asset class, region, news agency, etc. in the main menu of the TradingView site's root page. Of the groups presented, I most often use News Flow to get a general context of what is happening. Returning to my decision-making system, there is news (let's call it critical ) that can trigger the closure of a position or non-opening of a position in the shares of a particular company, even though the main indicators do not suggest this. To determine such news, I ask myself three questions: 1. Do I trust this news source? We are surrounded by many sources of news: social networks, news sites, television, etc. It’s easy to check everyone’s reputation on the Internet. Therefore, to take the news into account, you must trust its source. If you see significant news about a company, but it is not in reputable media resources and/or on the company's website, this is a reason to think whether the source is trying to increase its popularity through a loud headline and unverified content. 2. Does this news describe an accomplished fact? Even in reputable publications, you can find publications with versions of events, forecasts, and opinions. This is good food for thought. However, when deciding, I constantly try to separate the standpoint from the fact confirmed by a reliable source. Only facts can be considered when deciding. 3. Is an accomplished fact capable of leading the company to bankruptcy? This is a difficult question that requires an assessment of the company's economic damage, and its comparison with the level of total debt to creditors and current assets. Even if a company is facing bankruptcy, it can be saved by providing assistance from the government or other businesses. Answering this question, I can listen to the opinions of analysts and my intuition. Therefore, this is the most subjective facet of my decision-making system. I just have to tell myself: “Yes, this fact can lead the company to bankruptcy” or vice versa: “No, this news is bad, but it does not pose a critical threat to the business.” So, if I answer “yes” to all three questions, then I can close a position in the shares of a particular company or not open it, guided simply by my “yes, this should be done.” The fact is that critical news comes out now, and reporting on a specific date in the future: there is a time gap between these events. Therefore, I find myself in a situation where I just need to decide and evaluate it later, in the future, based on published reports. It is similar to flying an airplane that fails during transit. The pilot may not fully understand what happened, but the choice must be made right now. If I answer “no” to any of the three questions, then I continue to use other facets of my “crystal” in standard mode, and leave the news “just for my information.” In future publications, I will continue to elaborate on my decision-making system and share my approach to choosing the price and quantity of a stock trade.
SP:SPXEducation
by Be_Capy
7 Monopoly Lessons for TradersYou can learn a lot from the classic board game we all know and love: Monopoly. And as a trader, if you decide to play it again with your spouse or children – you’ll find the game to be very different. That’s because you have a better sense of risk, reward, probabilities and money management. You have the patience to grow a sizeable portfolio and eventually WIN! But before you do delve into your past, I want to share 7 important lessons I learned about trading from Monopoly. Hold Cash: The higher earner has the upper hand In Monopoly, the richer always has a stack of cash at the ready. Just like the Casino (where the house holds most of the money). And where the money is, is where the advantage lies. Similarly, in the trading arena, the money you have on hand is your golden ticket to seize profit opportunities. You know when they say, we are still counting our money? It’s because you have cash in hand rather than tied up in different assets. So with trading and with Monopoly, cash is king. You always need money to: Have funds to buy or sell more markets Be able to control your risk and money management Work on your Drawdown control methods Peace of mind you’re in it for the long haul No matter how many trades or positions I take, I always make sure to have at least 90% of cash in the portfolio at any one time. Be Patient: Not every roll is a winner Impatience is the enemy of traders. In Monopoly, you don’t win by making reckless moves at every turn. It’s about waiting for the right moment to strike. It’s about being patient to wait for the right property to buy and take advantage of. It’s about waiting for your opponent to land on your property for you to get paid. All in good time my friend., Apply the same philosophy to trading. The market will throw its share of doubles and snake eyes your way, but success lies in patience and strategic precision. You need to be patient for: The high probability trade to line up The markets to play out The drawdowns to end eventually Your portfolio to grow at a slow but steady rate Patience is EVERYTHING. Monopoly teaches us the value of holding onto our hard-earned cash. Similarly, in trading, preserving your capital is the name of the game. Avoid risky moves that could bankrupt your portfolio, and remember, sometimes the best move is not the flashiest one. Don’t blow on the most expensive stuff Just because Boardwalk has an expensive hotel doesn’t mean it’s the winning move. Similarly, the most expensive stocks or markets like Brent Crude or Indices like JSE ALSI 40 aren’t always the path to success. First, you might not have enough funds to accommodate the positions. Second, the markets might not have aligned perfectly to your strategy. Third, a high price market might be in a BUBBLE which is ready to pop. Fourth, it might be stressful putting in a large margin of funds to hold a more expensive stock i.e. Facebook, Berkshire Hathaway, Apple etc… Astute traders know that value can be found in unexpected places. You might find even better profit opportunities in other Blue Chip stocks that don’t even cost 1/10th of the price. Diversification and Opportunism: Building houses on every colour Monopoly teaches us the power of diversification. There are different properties with a variety of prices and conditions. You need to learn how to spread your investments wisely, and be opportunistic. Just as building houses on every color can secure your Monopoly victory, diversifying your portfolio across sectors, markets and positions can mitigate your risk and boost your chances of success. Strategic planning trumps luck I have to admit that, luck does play a role in both Monopoly and trading. It is luck to not roll the dice and land on “Go to Jail”. It is luck to not pick up a Chance card saying “You have to pay rates and taxes”. Same with trading. It is luck getting into a high probability trade and then the market actually playing out. It is luck being in a strong and favourable market environment for your trading system. It is luck having the market price shoot up past your take profit due to some external event. But trading and Monopoly are both very much strategic planning processes. You need to plan your moves carefully. You need to act on your moves, based on probabilities. You need to risk accordingly to not go bankrupt. You need a strong and well-thought-out trading plans. Conduct thorough analyses, and stick to disciplined strategies. And this is how strategy and luck will help you increase the chance of success. Negotiation mastery Monopoly is not just about rolling the dice; it’s about negotiation. You are playing against opponents of different advantages and styles. You need to learn how to negotiate, aid and help each other – before you beat them! I don’t know how else to explain this :D. Trading also involves striking deals. You’re hitting bids (when selling) and offers (when buying). You’re betting against your counterparty (investor, trader or market maker). You’re negotiating prices and moves. The choices you make will give you the significant edge and help streamline your profitable journey. Passive Income Key: Collect $200 as You Pass Go The exciting and genius of Monopoly lies in the sweet reward of $200 every time you pass Go. You know that feeling of waiting and playing your turns. Going through the good Chance cards and the Bad (going to jail). But when you are out and you pass Go, you can to collect your wage of $200. This is your special passive income secret weapon. You don’t just stick to what you have, you build on it and use what you newly have to grow your portfolio. The same works with trading. Each month, you receive a salary. And you spend, save and invest. So if you want to grow your trading portfolio using the compounding strategy, you might as well build on it. You might as well accelerate your trading journey. You might as well let your money work for you! Embrace the power of compounding, re-investing and depositing, and you might find yourself collecting much more than $200 as you navigate the trading board. Let’s sum up the Monopoly Lessons Traders Can learn: Hold Cash: The higher earner has the upper hand Be Patient: Not every roll is a winner Don’t blow on the most expensive stuff Diversification and Opportunism: Building houses on every colour Strategic planning trumps luck Negotiation mastery Passive Income Key: Collect $200 as You Pass Go FINAL WORDS: The trading board is yours – now go bankrupt the market, one strategic move at a time!
TVC:SA40Education
by Timonrosso
VWAP INDICATOR EXPLAINED👋Hello traders! In this post, I would like to introduce you to the VWAP indicator, which is used by major market participants in their trading. Moving averages are one of the most popular basic tools of technical analysis. More than 10 variations are known: EMA, LWMA, etc. All of them, in one way or another, use the same principle of data averaging; the difference is in the coefficients applied to each period. The VWAP indicator is also an analog of the MA indicator, which differs in the fact that the values of periods are weighted by trading volumes. This makes it possible to see a more real picture in contrast to what MA indicators show. Advantages And Disadvantages Of The Vwap Indicator 📊 In a nutshell, let us recall the principle of calculating a simple moving average (and the rules of their application): the arithmetic mean. If there are three last candles with closing prices (you can choose another price): "5", "3", and "8", then the simple moving average will be equal to (5+2+8)/3 = 5. Now let's imagine that we get to the market. The seller offers 100 apples at the price of 5 euros and 1 pear at the price of 50 euros. If we follow the MA formula, the average price would be (5+50)/2 = 27.5. And this price would be regardless of how many pieces of apples or pears there are. But, agree, this somehow does not accurately reflect the real average price. It would be more correct to also take into account the quantity of goods sold. And then the formula would look like this: (5*100 + 1*50)/101 = 5.44 euros. That is, in this case, one single pear will not dramatically affect the average price. What is VWAP? 🤔 The Volume Weighted Average Price (VWAP) indicator is a technical analysis tool, in which the price of each period is weighted by trading volumes of the same period. If on a 5-minute chart one candlestick during 5 minutes trading volumes conditionally amounted to $1 million, and on the second candlestick to $10 thousand, the influence of the second candlestick on the indicator value will be minimized. Features Of The Vwap Indicator 📝 • VWAP is a trend indicator that works on the same principle as moving average indicators. • VWAP shows the level of liquidity. The higher the volumes of this or that period, the greater the liquidity in this area. Accordingly, a decrease in the indicator value indicates a decrease in liquidity, either because there is a flat period or traders temporarily minimize open trades. • VWAP has a minimum of settings and is a confirming indicator for trend strategies. The VWAP indicator could be a great tool for technical analysis, if not for one question: where to get data on volumes? At an individual broker, it is tick data, which is far from the real market volumes, which distorts the final result so much that it is easier to use classic moving average data. Since each broker has different volume data with almost the same quotes, VWAP will draw different lines on different platforms. From a professional point of view, it is unacceptable. But on the other hand, if you use VWAP as a confirming signal, you can "adjust" to its chart, finding regularities. The indicator signals are interpreted separately for long-term and short-term trends. In preliminary analysis, the long-term trend is evaluated first: if VWAP is below the price line for a long time (it is best seen on a line chart), the trend is upward or downward. On the lower timeframe, the logic is somewhat different. If the current price is below the VWAP, it means that the asset can now be bought at a more favorable price than the average market price. However, there is no guarantee that the price will not continue to go down, so the strategy should be based on the main trend indicator, where VWAP will be an additional tool. If the VWAP indicator crosses the price several times, the market is flat. Conclusion ✅ It is possible to build a successful trading system based on the VWAP indicator. VWAP is not the Holy Grail, but it can be used to build a strategy with a positive mathematical expectation, which is the ultimate goal of forex trading. The VWAP indicator is interesting for those who work with large volumes of trades on the stock market with direct access to the U.S. exchanges, from where VWAP will pull the initial data. Traders, If you liked this educational post🎓, give it a boost 🚀 and drop a comment
Education
by Lingrid
7
RAILWAY TRACKS CHART PATTERN Railway Tracks Pattern is a secondary formation (unlike pinbars and inside bars) of Price Action, but no less frequent on the chart of price movement of a certain underlying asset. It occurs mainly during the correction of the main trend movement. That is, it is necessary to catch the pattern on a pullback from the main trend. ✴️ THERE ARE TWO TYPES OF PATTERN • Bullish pattern is formed in a downward movement and indicates a change from a bearish trend to a bullish trend; • Bearish pattern is formed in an upward movement and indicates a change from a bullish trend to a bearish trend. ✴️ THE SHAPE OF THE RAILWAY TRACKS PATTERN The pattern consists of only two candles (bars). The following conditions are necessary for the pattern formation. Each candlestick should be facing different directions. That is, there must be bearish and bullish candles. The bodies of the candles should be long and make up at least 70% of the entire length of the candle. By the way, if you switch to higher timeframe of the chart when the Railway Tracks Pattern is formed, you can find a pinbar, which is also a reversal pattern in the Price Action trading system. For example, on the 15-minute chart of the GOLD a bearish Railway Tracks Pattern was formed, which led to a trend reversal: And if you look at the 30-minute chart, you can see a pinbar: These are the nuances of the pattern that can play into the hands of a trader, especially beginners. ✴️ WHAT THE RAILWAY TRACKS PATTERN INDICATES If we look at the pattern itself, we can realize that the market has changed its mood sharply. At the same time, as a rule, this abrupt change of mood is short-term. The pattern indicates a reversal of the current trend, but that does not mean that it will be long-term. Most often, after the pattern in question, the price moves in the direction opposite to the previous trend, for a short distance, a relatively small range. After a sharp change of mood in the market, as a rule, a flat move follows. In the resulting sideways trend, you can usually recognize the next pattern of trend continuation or reversal. ✴️ HOW TO TRADE RAILWAY TRACKS PATTERN In order to apply Railway Tracks Pattern in trading, you need to consider only a high-quality pattern. In addition, the signal from the pattern should be confirmed by any of the following technical analysis tools: • support and resistance levels • Fibonacci levels • trend lines or trend channel • divergence In addition, the pattern is considered to be of higher quality the longer the bodies of its candlesticks are. It is most profitable to trade it at the end of the correction of the main trend. That is, trading will be conducted in the direction of the main trend. The formation of the pattern is a signal in itself. If there is a confirming factor, it is necessary to enter the trade. For the Forex market, the target price is the nearest potential support or resistance level. The order should be pending in the direction of the potential movement. Stop Loss should be at the level of the opposite extremum the highest point in a bearish setup and the lowest point in a bullish setup. ✴️ BOTTOM LINE The Railway Tracks Pattern is a reversal formation in indicator-free trading. It serves as a confirming factor about the trend reversal rather than a full-fledged trading signal. Therefore, the pattern must be confirmed by other tools of technical analysis of the chart.
Education
by DeGRAM
1
Trading Sessions in Forex | Free Market Sessions Indicator Hey traders, In this post, we will discuss trading sessions in Forex . Let's start with the definition: Trading session is daytime trading hours in a certain location. The opening and closing hours match with business hours. For that reason, trading hours are varying in different countries because of contrasting timezones. ❗️Please, note that different markets may have different trading hours. Also, some markets have pre-market and after-hours trading sessions. In this post, we are discussing only forex trading hours. The forex market opens on Sunday at 21:00 GMT and closes on Friday at 21:00 pm GMT. There are 4 main trading sessions in Forex: 🇦🇺 Australian (Sydney) Session Opens at 21:00 GMT and closes at 06:00 GMT 🇯🇵 Asian (Tokyo) Session Opens at 12:00 GMT and closes at 9:00 GMT. 🇬🇧 UK (London) Session Opens at 7:00 GMT and closes at 16:00 GMT. 🇺🇸 US (New York) Session Opens at 12:00 GMT and closes at 21:00 GMT. Asian trading session is usually categorized by low trading volumes while UK and US sessions are categorized by high trading volumes. Personally, I trade the entire UK session and US opening and usually skip Australian and Asian sessions. There is a free technical indicator on TradingView that allows to underline trading sessions on a price chart. It is called "Market Sessions". Being added, it displays the market trading sessions. What trading sessions do you trade?
OANDA:XAUUSDEducation
by VasilyTrader
2