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Hidden Costs of Trading You Must Know In this educational article, we will discuss the hidden costs of trading. 1 - Brokers' Commissions Trading commission is the brokers' fee for opening a trading position. Usually, it is calculated based on the size of the trade. Though most of the traders believe that trading commissions are too low to even count them, the fact is that trading on consistent basis and opening a couple of trading positions weekly, the composite value of commissions may cut a substantial part of our profits. 2 - Education Of course, most of the trading basics can be found on the Internet absolutely for free. However, the more experienced you become, the harder it is to find the materials . So you typically should pay for the advanced training. Moreover, there is no guarantee that the course/coaching that you purchase will improve your trading, quite often traders go through multiple courses/coaching programs before they become consistently profitable. 3 - Spreads Spread is the difference between the sellers' and buyers' prices. That difference must be compensated by a trader if one wished to open a trading position. In highly liquid markets, the spreads are usually low and most of the traders ignore them. However, being similar to commissions, spreads may cut the substantial part of the overall profits. 4 - Time When you begin your trading journey, it is not possible to predict how much it will take to become a consistently profitable trader. Moreover, there is no guarantee that you will become one. One fact is true, you should spend a couple of years before you find a way to trade profitably, and as we know, the time is money. More time you sacrifice on trading, less time you have on something else. 5 - Swaps Swap is the fee you pay for transferring a position overnight . Swap is based on a difference between the interests rates of the currencies that are in a pair that you trade. Occasionally, swaps can even be positive, and you can earn on holding such positions. However, most of the time the swaps are negative and the longer you hold your trades, the more costly your trading becomes. The brokers' commissions, spreads and swaps compose a substantial cost of our trading positions. Adding into the equation the expensive learning materials and time spent on practicing, trading becomes a very expensive game to play. However, knowing in advance these hidden costs, the one can better prepare himself for a trading journey.
OANDA:XAUUSDEducation
by VasilyTrader
5
Trading Lucrative-Heads 'N' Shoulders Patterns : Silver 1 HR Heads 'N' Shoulders' Patterns can be very lucrative and a pattern to keep in mind every trading day. They work on all time-frames. Often I see market structure price reversals on the 1 minute timeframe all the way down to 10 seconds. They will be easier to trade on the higher time frames as their price-action can be super-fast on these very low timeframes. Depending on how you apply risk to reward in your trading, they will be more lucrative on the higher timeframes and more reliable because more traders see them on these bigger timeframes right up to weekly and monthly charts. Here is what you need to know: * Take advantage of the tradingview 'All Charts' pattern recogniser. This is what most traders including professional-traders would be using because it eliminates subjectivity. * Draw your neckline from the bottom of left-shoulder across and beyond where the right shoulder comes down (price will be below to the left of the right shoulder & your exact point for the left shoulder will be under & to the right of left shoulder) * Most often price will in the first instance after the right shoulder is formed, break through the neckline and then retest above the neck line or below the neck line if its a bullish Inverse Head 'N' Shoulders pattern. Seeing this retest occur will give the setup more reliability. (Note: Price does not always Retest especially if price is selling or buying from a strong resistance or support area, respectively) * Your trigger to buy or sell is on the retest/retracement above or below neckline, look for an increase in volume and/or a strong reversal candle like a pin-bar or engulfer. (Your reward is generally the same distance as the neckline below the head) * I hope this helps in your own trading. Trading is risky. Please don't rely solely on my financial analysis or trade setups.)
EIGHTCAP:XAGUSDEducation
by Easy_Explosive_Trading
Books on trading and Profitunity strategy by Bill WilliamsIn this article, I will share books that were useful for me in the process of studying trading and the Profitunity trading strategy by Bill Williams. Bill Williams "Trading Chaos 1 and 2" ♡ The first and third books by Bill Williams contain complete and up-to-date information on the Profitunity strategy. The second book "New Trading Dimensions" is intermediate and less relevant. The book Trading Chaos 1 includes trading psychology (an integral part of trading), the basics of understanding the markets, candlestick patterns (divergent bars and determining the trend based on a pair of bars, the market facilitation index, volume and squat bar), Elliott waves (characteristics, determining waves using the MACD 5/34/5 indicator, an analogue of the modern Awesome Oscillator, and the Fibonacci ratio), fractals, trading in waves (impulses 1-3-5 and ABC correction). And also very important topics — how to work with your internal structure and how our brain functions (Chapter 11). The book Trading Chaos 2 (co-authored by Bill Williams' daughter Justine Gregory) includes a description of the Alligator indicator in combination with the Awesome Oscillator, divergent bars and fractals. And also tools for working on yourself - morning pages (Chapter 13, from the book by Julia Cameron "The Artist's Way") and autogenic training for traders by Johannes Schultz (Appendix 3). Tom Hougaard "Best Loser Wins" ♡ The book greatly expands the perception of markets, the approach to trading and deeply describes the psychology of trading. The book was first published in 2022 and perfectly complements the books by Bill Williams. John J. Murphy "Technical Analysis of the Futures Markets" A basic book on classical (linear) technical analysis, which also contains up-to-date information on Elliott Wave Theory in addition to the corresponding section in the book by Bill Williams "Trading Chaos 1". Alexander Elder "Trading for a living" (How to Play and Win on the Stock Exchange) A book on the psychology of trading and classical chart analysis, includes a detailed description of popular indicators and a description of the basic strategy "Three Screens" (analysis of the chart on the senior and junior timeframes), as well as an important topic "Risk management". Steve Nison "Japanese Candlesticks" A basic book on classical candlestick (bar) analysis. Thomas DeMark "Technical Analysis - a new science" Constructing trend lines based on the support price minimums and maximums described in the book led me to search for an indicator that displays such bars, as a result, I first became acquainted with the Bill Williams Fractals indicator, even before I became acquainted with his strategy. Theodore Dreiser "The Financier" ☽ A novel published in 1912 based on the life story of the American millionaire Charles Yerkes (1837-1905). The book shows how the financial and economic environment surrounding the main character (Frank Cowperwood) already from childhood forms in him the psychology of a businessman and stock dealer... Robin Sharma "The 5 AM Club" ☆ This book is not about trading, but about healthy habits. But for me the book became useful, including in trading, because I made the following conclusion for myself - it is important to rest (take breaks) every day, and not only on weekends and vacations. And it is worth starting with the fact that after waking up there is free time (about 1 hour) before business activity begins, i.e. either wake up earlier, or move all things forward, so that you can start your day easily. And taking breaks in trading is very important, so I recommend paying attention, for example, to the algorithm for removing limitations using neurographics. (◉ ‿ ◉) There are many good books, as well as good strategies, but I am sure that only independent deep study, practice, good concentration and self-control will allow you to find your own understanding of the markets and your own approach to successful trading.
CME_MINI:ES1!Education
by grigorykov
I’ve spent 8 years in crypto, and here’s what I’ve discovered ↓↓I’ve spent 8 years in crypto , and here’s what I’ve discovered ⏬ ------------------- ▪️ Throughout my journey, I’ve met hundreds of ambitious traders, but today only a few remain —those who were willing to wait and those who didn’t dream of quick profits. ▪️ According to most official studies, only 1-3% of traders make money. ▪️ Only 1% can overperform the market and earn more than a simple buy-and-hold strategy. ▪️ Intuition and prayers don’t work here; without a clear strategy , you will lose everything, I guarantee it. ▪️ The best of the best earn 100-150% annually (check the World Cup Trading Championships to verify this). Yes, there are sometimes bull markets where you can make 500% or more, but this happens only once every four years, and you need to be earning consistently. ▪️ The crypto market is changing, and this cycle is very challenging , even for professional market participants. The only way to succeed is to constantly adapt. ▪️ 99% of bloggers and influencers you follow are complete scams. Most of them won’t be able to show you a yearly trading account performance report upon request in real-time. They make money not from trading, but from you, by selling yet another course. (Always check their profitability statistics; it's the only way to verify if this person is a professional or a fraud). ------------------- Everyone is looking for the holy grail , and I searched for it too, but I found it in algorithmic trading . This trading style allows me to rely solely on numbers, clear profitability indicators, and statistics. Most importantly, it removes the human factor (staying emotionally stable, not succumbing to fear and greed).
Education
by Yaroslav_Krasko
4
How I used Volume Spread Analysis to avoid FOMO trading!As a trader, I often battle with the fear of missing out (FOMO), a common pitfall among traders that can lead to impulsive, unprofitable trades. After reviewing my journal, I determined that chasing breakouts was costing me a significant portion of my account, so I studied Volume Spread Analysis (VSA) to help me reduce my urges. Here is how is used VSA to avoid FOMOing a trade. Before we get started, let's clarify two definitions: Volume: Measures the number of times buyers and sellers exchange 1 unit of an asset at an agreed-upon price. It doesn't inherently indicate whether a trend is bullish or bearish, but rather that a trade has occurred. Low volume suggests that few transactions have taken place because buyers and sellers couldn't agree on price. High volume suggests that buyers OR sellers felt they were getting a bargain at the current price, leading to many transactions. Spread/Range: The difference between the high and low of a candlestick. A narrow spread indicates little variance between what someone is willing to buy for and what someone is willing to sell for. A wide spread suggests that buyers and sellers have significantly different ideas of what the fair price is. In short, Volume Spread Analysis (VSA) interprets the relationship between trading volume and candle spread. When volume and spread agree, they are considered harmonious, and the trend will probably continue. If volume and spread disagree, there is a divergence, and the trend may be weak or could even reverse. In general, there are three main harmonious conditions: Narrowing spread should have narrowing volume. Average spread should have average volume. Widening spread should have widening volume. I spotted a bear flag consolidation on QQQ and decided I would trade the breakout to the downside. I took a break and came back to the chart just after the breakdown had occurred, missing my ideal entry. The candle spread was widening and my first thought was "I have to get in! This thing is free falling!" PAUSE! I reminded myself that I cant make every dollar in the market. If I miss this trade, there will always be another. "Be patient and wait for the market to come back to you." This is the chart after the initial break. What can we observe? QQQ broke the low of day with high volume and a widening red candle. Based on our definitions from earlier, we know that high volume means that buyers or sellers think they are getting a bargain so they are willing to transact as much as they can at current price. Given that price is falling, we can assume that the volume is due to aggressive selling. We remain patient and continue to watch for something to trade against. Next, we see a narrower range candle with a long lower shadow and above average volume. By definition, strong volume with a narrow range is a possible divergence. We know that narrow range candles mean that buyers and sellers generally agree on current price, but why would it close near the highs if the selling was so aggressive? Given that there is a long lower shadow and then a bullish candle close, we can infer that sellers were not willing to sell below $467.89. The buyers absorbed the selling at those prices. Fast forwarding, we notice that the volume and candle size has shrunk back to the average meaning buyers and sellers are in agreeance. The number of people willing to transact is decreasing. We also notice that a small range has formed. Buyers have not stepped in to buy above the previous low of day at $469.35 and the sellers have shown no effort to get back below $467.89. Now we have something to trade against instead of FOMOing in! We will look for a break of this range with increased volume. On the next candle we see bulls break out of the range with aggressive volume and a wide spread candle. Something of note is that the volume on this bull candle is less that the volume of our initial sell candle. If those sellers were still present, wouldn't they be selling at these higher prices and forcing the candle range to be narrow? This shows us that bulls are now in control and the selling from earlier was just a hoax. As we can see, the rest is history. If I FOMOed into the short as I had planned, this trade would have resulted in a loss. Being patient allowed me to realize that there was nothing to miss out on and actually allowed me to find a better trade. Key Notes Always journal your trades and review them Never FOMO into a trade. Be patient and wait for the trade to come to you! You dont need to take every trade to make money in the market. It is okay to miss a trade if it means protecting your account. Volume spread analysis is not 100%, but it can be useful in determining the strength of a trend.
NASDAQ:QQQEducation
by Decam9
31
A Dilemma: Do Stock prices moves Options or Vice Versa???This interesting question touches on the complex relationship between stock prices and option prices. Let's break down this dilemma: 1. The theoretical relationship: In theory, stock prices drive option prices. Options are derivatives, meaning their value is derived from the underlying asset (in this case, the stock). The Black-Scholes model and other option pricing models use the stock price as an input to calculate option values. 2. The practical reality: In practice, the relationship can become more complex, especially in the short term. There are scenarios where options trading can influence stock prices, creating a feedback loop. 3. How options can influence stocks: - Delta hedging: Market makers who sell options often hedge their positions by buying or selling the underlying stock. This can create buying or selling pressure on the stock. - Large option positions: Significant option volumes can signal bullish or bearish sentiment, potentially influencing trader behavior in the stock market. - Pinning: As expiration approaches, there can be forces that "pin" a stock to a particular option strike price due to hedging activities. 4. The max pain theory: This theory suggests that option trading can influence stock prices, particularly near expiration, pulling the stock price toward the maximum pain point. 5. Short-term vs. long-term effects: While options can influence stock prices in the short term, fundamental factors (like earnings, economic conditions, etc.) tend to dominate in the longer term. 6. Market efficiency considerations: In highly liquid markets, any predictable influence of options on stocks should, in theory, be quickly arbitraged away. However, markets aren't always perfectly efficient. 7. Regulatory perspective: Regulators are aware of potential market manipulation through options and monitor for such activities. In conclusion, while the primary relationship is stock prices influencing option prices, there can be feedback effects where options trading influences stock prices, especially in the short term. This creates a complex, interconnected system that traders and analysts must navigate carefully. Max Pain theory in options trading is an interesting concept. Here's a concise overview: Max Pain refers to the strike price where option buyers (collectively) would experience the maximum financial pain, or loss, at expiration. Conversely, it's the price at which option sellers would profit the most. Key points: 1. It's based on the idea that option sellers (often market makers) try to manipulate the underlying asset's price toward maximum pain. 2. Calculated by determining the price at which the value of all outstanding options would be minimized. 3. Used by some traders to predict where a stock's price might gravitate as expiration approaches. Max Pain theory is controversial. While some traders swear by it, others are skeptical of its predictive power. It's important to note that many factors influence stock prices, and Max Pain is just one potential consideration. NVDA: Total open interest: 28.4 million contract while SPX, SPY, QQQ, IWm, and TSLA's open interest is: 21,20.5,13.5,6.9 million respectively. Total open interest is an important metric in options and futures trading. Here's a concise overview: 1. Definition: Total open interest refers to the total number of outstanding contracts (options or futures) that have not been settled or closed. 2. Calculation: It's the sum of all open positions across all strike prices and expiration dates for a particular underlying asset. 3. Significance: - Market activity indicator: Higher open interest generally indicates more active and liquid markets. - Trend confirmation: Increasing open interest can confirm the strength of a price trend. 4. Interpretation: - Rising open interest + rising prices: Often indicates a bullish trend. - Rising open interest + falling prices: Often indicates a bearish trend. - Falling open interest: May suggest a weakening of the current trend. 5. Contrasts with volume: - Volume measures the number of contracts traded in a given period. - Open interest represents the number of active contracts at a point in time. 6. Uses: - Assessing market sentiment - Gauging the strength of price movements - Identifying potential support/resistance levels 7. Limitations: - Doesn't indicate the direction of trades (long vs. short) - Can be misleading if not considered alongside other factors
NASDAQ:NVDAEducation
by Moshkelgosha
4
Strategic Gold Plays: Maverick-Rabbit Precision in Key PatternsBased on your archetype, a combination of the Bold Maverick and the Analytical Rabbit, you have a natural tendency to take calculated risks while also ensuring that those risks are backed by thorough analysis. This hybrid nature likely drives you to engage in trades that have high potential rewards, but only when they meet specific analytical criteria. Chart Analysis and Coaching on Your Positions Overview: Context: This is a 15-minute chart of XAUUSD (Gold vs. USD). Structure: The chart shows a clear bullish trend with higher highs and higher lows. There are multiple channel formations, liquidity zones (LQZ), and key levels identified (including a 4H Over Ride/LQZ level). 1. Position Analysis: First Entry - Inside the Ascending Channel: Entry Reasoning: You likely identified the ascending channel as a bullish continuation pattern and entered within it. Archetype Reflection: As a Bold Maverick, you're comfortable entering before a full breakout, assuming the trend continuation. However, as an Analytical Rabbit, you probably also considered the channel support before entry. Coaching: This entry aligns with your dual archetype. You took the position inside the channel, expecting price to continue its upward momentum. However, consider tightening your stop loss in case of a fake breakout to protect your position. Second Entry - Near the LQZ: Entry Reasoning: You likely saw price approaching the Liquidity Zone (LQZ), expecting a bounce or reaction at this level. Archetype Reflection: Analytical Rabbits love analyzing levels like LQZ, while Bold Mavericks might anticipate a reaction before confirmation. Coaching: Good job recognizing the importance of the LQZ. You probably set a trailing stop to capture profit while letting the trade run. Just be cautious with overconfidence—always have a plan if the price moves against you. Third Entry - At the 4H Over Ride / LQZ level: Entry Reasoning: This level is crucial as it represents a 4H Liquidity Zone (LQZ), a significant potential reversal point. Archetype Reflection: This is a classic Bold Maverick move—anticipating a strong reaction at a higher timeframe LQZ. The Analytical Rabbit side of you likely analyzed the 4H timeframe and identified this as a high-probability zone. Coaching: This is an aggressive yet well-informed entry. Ensure your stop loss is adjusted to below the LQZ to minimize risk in case the market turns against your position. 2. Trailing Stop Loss (SL) Usage: Position: You’ve used trailing stop losses, which is a smart move, especially given the bold yet analytical approach. Coaching: Trailing stops can help lock in profits as the price moves in your favor. Ensure that the trailing distance is neither too tight (to avoid premature exit) nor too wide (to protect against significant pullbacks). This aligns with the Analytical Rabbit’s cautious nature. 3. Key Levels and Patterns: Ascending Channel: The price is respecting the channel boundaries, which validates your initial entries. LQZ & 4H Override: Price has shown reactions at these levels, indicating they are well-chosen. 4. Risk Management: Balance Between Risk and Reward: Your trading strategy seems to balance the Bold Maverick’s appetite for risk with the Analytical Rabbit’s focus on minimizing unnecessary exposure. Coaching: Given your dual archetype, keep refining your entry and exit points. Use the rule of three (waiting for confirmation after three touches on key levels) to align with your analytical side​​. Conclusion: Your trading approach is a robust mix of intuition and analysis. You're combining bold entries with a solid understanding of market structure. Continue to refine your strategy, especially in the context of multi-timeframe analysis and liquidity zones, to maximize your trading effectiveness. Make sure to always have an exit strategy and avoid letting the Maverick side take over without sufficient backing from the Rabbit’s analysis​​​​.
OANDA:XAUUSDEducation
by MommaPreneur
Smart Money and the why behind it I have used @TradingView for near enough 10 years now. What I like about the platform is the simplicity and the tools. I often get asked about things like strategy or other people's techniques - "What do you think of SMC or this guy or that guy" Look, when it comes to trading - Liquidity is something very little people understand. Gurus talk about it and draw pretty lines but still fail to break it down as to why it's there in the first place. "Ah it's where the big boys buy or sell" so to help visualise this lets use some of these tools here on Tradingview. Look at my first chart here; What I have done is jumped up a timeframe and placed a volume profile tool on my chart, then simply used the drawing tool to draw a squiggle around the relevant nodes. I then dropped back to the smaller timeframe and switched on a couple of indicators to help visualise where the liquidity is. if you look at the lines 15minutes and 30minutes both in green and cast your eyes to the right, can you see they sit just below (as price is coming from above) to those higher volume nodes from that higher timeframe? Let's use another tool here on TradingView; This one is called a fixed range volume profile. the two blue lines extended out are known as the value area high and low. Often this is set to around 70-75% but I like to reduce that a little. The red line is called a PoC or point of control. This basically means the highest transactional point of the range you fixed. However, if you look over to the left this time you will see two higher volume nodes (mountains) and therefore look at the 15m and 30m lines again with fresh eyes. In this next image I have increased the range and dragged it over to include more data. I could write full strategies on this tool alone. The first thing you should notice is the PoC has now jumped up higher. Think logically about this for a second. We are seeking lower timeframe liquidity down low and the area of interest and value is showing price was accepted up high. So, after grabbing liquidity, would we anticipate the price to continue down lower or come back to play in the accepted zone? This is where a lot of newer traders fail, especially when trading smart money concepts "SMC" for short. They fail to understand the bigger picture. Another little tool in the same box-set is the Timeprice indicator. Much like session volume this gives a pretty clean view and of course settings can be adjusted. I like the look on this one, it's very modern. But the real value isn't until you zoom in and zoom in and you see why it's called Time - Price. I'll leave that for another post. But continuing the theme of this post; look at the clusters of the time price indicator and note where the PoC sits on the 15m liquidity level. Then below the 30m liquidity is the lower side of the value area. Are you starting to see a theme? In this last image; I have simply highlighted liquidity to keep my chart clean. You will see candles showing the last buys before the selloff. Then a consolidation under the liquidity - this is basically a Wyckoff structure prior to a mark down move. We then drop into the liquidity pocket and here is where most SMC traders would be jumping long. We see a very nice little rally, then a large fast drop through the liquidity, this hitting many stops and triggering new short positions. which is why as these shorts get triggered, you anticipate the pullback - to what level? Well look left and the charts will tell you. I hope this has opened a few eyes - go away and have a play with these indicators on @TradingView and feel free to aks if you have any questions. Disclaimer This idea does not constitute as financial advice. It is for educational purposes only, our principle trader has over 20 years' experience in stocks, ETF's, and Forex. Hence each trade setup might have different hold times, entry or exit conditions, and will vary from the post/idea shared here. You can use the information from this post to make your own trading plan for the instrument discussed. Trading carries a risk; a high percentage of retail traders lose money. Please keep this in mind when entering any trade. Stay safe.
Education
by Mayfair_Ventures
4
Bitcoin’s Rounded Top [Wyckoff Distribution]: 5 Phases to KnowHello, Trading Community! Today, we dive into the fascinating world of the Wyckoff Distribution model as it applies to Bitcoin's current market structure. Please remember that this article is purely for educational purposes and is not intended as trading advice. While we explore potential scenarios, including the possibility of Bitcoin heading down to $30,000 or even $25,000, these claims are speculative and should be considered hypothetical. The Wyckoff Distribution Model: A Roadmap for Market Tops The Wyckoff Distribution model offers a comprehensive framework for understanding how major market players distribute their holdings before a significant downturn. It is divided into several phases: Phase A: The market begins to show preliminary signs of selling pressure after an extended uptrend. This is the first hint that the balance of power is shifting from buyers to sellers. Phase B: The market enters a consolidation phase, moving sideways as large investors gradually distribute their positions. Phase C: A deceptive breakout, known as the Upthrust After Distribution (UTAD), occurs here, often trapping unsuspecting retail traders. Phase D: The onset of a decline, marked by clear Signs of Weakness (SOW), indicates that the distribution phase is nearing its end. Phase E: The final phase, where the market confirms the distribution and continues to fall, marking the completion of the process. Breaking Down Bitcoin's Key Price Points Let's take a closer look at the crucial price points that have defined Bitcoin's current structure within the Wyckoff Distribution model: Buying Climax (BC) - $73,660 This is the pinnacle of buying activity, where demand reaches its peak before supply starts to dominate. For Bitcoin, this level marked the highest point in the current cycle before a significant sell-off began. Automatic Reaction (AR) - $60,795 Following the Buying Climax, the market experienced an Automatic Reaction—a sharp drop as sellers stepped in. This level is critical as it signifies the start of the distribution process. Upthrust (UT) - $71,180 The Upthrust represents a rally that tests the resistance near the Buying Climax. However, it fails to sustain those levels, hinting that the market's upward momentum is weakening. Upthrust After Distribution (UTAD) - $71,680 The UTAD often serves as a bull trap, where the price makes a final push above the resistance only to quickly reverse. This move confirms that distribution is taking place. Sign of Weakness (SOW) - $54,344 After the UTAD, the market drops significantly, signaling a clear Sign of Weakness. This level demonstrates that sellers are gaining control, pushing the price to new lows. Last Point of Supply 1 (LPSY 1) - $70,040 The first Last Point of Supply (LPSY 1) is a weaker rally that fails to reach previous highs. This is a key indicator that the market's bullish momentum is fading, and distribution is nearing completion. Last Point of Supply 2 (LPSY 2) - $65,105 Currently, Bitcoin is in Phase E, at the LPSY 2 point. This level is crucial as it typically marks the final confirmation of distribution before a sustained downtrend. Navigating Phase E: The Final Act of Distribution As Bitcoin navigates through Phase E, the LPSY 2 level becomes a focal point. This phase is characterized by further price declines as the market confirms the distribution. Here’s what to watch for: Lower Highs and Lower Lows: Expect the price to continue forming lower highs and lower lows, reinforcing the bearish trend. Volume Patterns: During this phase, volume analysis becomes critical. Look for decreasing volume on upswings and increasing volume on downswings, which confirms the presence of distribution. Final Thoughts The Wyckoff Distribution model provides a structured way to understand how markets transition from bullish to bearish trends. With Bitcoin currently exhibiting a Rounded Top structure and sitting at LPSY 2 in Phase E, the evidence suggests that we may be on the cusp of further declines. By staying vigilant and analyzing key price levels and volume patterns, traders can better position themselves to navigate this challenging market environment. In this complex market phase, understanding the underlying forces at play can be the difference between protecting your capital and being caught off guard by the next big move. Stay tuned for more!
INDEX:BTCUSDEducation
by ArShevelev
4
Think Like a Pro: How to Be Your Own Trading PsychologistEver Felt Like Your Worst Enemy in Trading? Here’s How to Overcome it! Have you ever been in that moment where you're staring at the screen, and every fiber of your being is screaming, "This trade is going south," but you still hold on? It’s like watching a train wreck in slow motion—except you’re the conductor, and somehow, you’re glued to your seat.What if you could turn that inner chaos into clarity? Imagine becoming your own trading psychologist, mastering the mental game to transform your trading experience. It’s possible, and it’s within your reach. The Mirror Doesn’t LieThe biggest challenges in your trading aren’t just the volatile markets or the unpredictable news— they’re the emotions that cloud your judgment. Fear, greed, hesitation, overconfidence— these emotions can lead you to make mistakes that are both costly and frustrating. But here’s the key: the problem isn’t the emotions themselves, but how you manage them. Recognizing this can help you see the market—and your trades—in a completely new light. The Secret Sauce: Self-AwarenessThe first step toward mastering your trading psychology is learning to recognize your triggers. What sets you off? Is it a losing streak? A sudden market spike? Maybe just a stressful day. Identifying these triggers is crucial to controlling your trading behavior.Once you recognize your triggers, managing them becomes much easier. It’s like seeing a storm on the horizon—you can’t stop it, but you can definitely prepare for it. Setting hard rules for when to step away from the screen, and more importantly, when to stay focused, can make all the difference in your trading results. Actionable Tips: Turn Insight into Action So, how can you apply this in a practical way? Here are a few strategies that can help you take control of your trading psychology: Journal Everything : Start by journaling not just your trades, but your thoughts and emotions before, during, and after each trade. You’ll begin to see patterns emerge, showing when you might be about to go off the rails. Mindful Breaks: Set timers to remind yourself to step away from the screen for a minute or two. This gives you the space you need to reset, especially when things get intense. The “Pause” Button: Before entering a trade, take a moment to pause and ask yourself, “Am I acting out of emotion, or is this a rational decision?” This simple act can prevent countless bad trades. Create a Pre-Trade Routine: Just like athletes have pre-game rituals, creating a routine to get into the right headspace before trading can be incredibly beneficial. This might involve reviewing your journal, setting goals for the session, or doing a quick mental check-in. Don’t Go It Alone: Trading doesn’t have to be a solo journey. Platforms like TradingView are excellent for connecting with other traders. Whether you’re joining a chat, reading other traders’ ideas, or commenting on their posts, engaging with the community can provide valuable insights and feedback. Sometimes, the best advice comes from others who’ve been in your shoes and can help you see things from a different perspective. The Result? A Psychological EdgeBy mastering your trading psychology, you can stop sabotaging yourself. Instead of reacting impulsively to the market, you can respond with clarity and purpose. The challenges of trading will still be there—this is the market, after all—but with the right mindset, you can turn them into opportunities. If trading psychology has been a struggle for you, know that you’re not alone, and there’s a way forward. By looking inward, recognizing your patterns, and applying a few simple strategies, you can gain the psychological edge you need to succeed. Trading isn’t just about reading the market; it’s about understanding yourself. And once you master that, the possibilities for your trading are endless. Let me know what you think below:)
NASDAQ:ASSTEducation
by TheFxAce
6
Theories of Technical AnalysisTheories of Technical Analysis Dive deep into the intricacies of technical analysis with a close examination of five pivotal theories of technical analysis — Dow, Wyckoff, Gann, Elliott, and Merrill. Unravel their foundational concepts, applications, and histories to gain a comprehensive grasp of market dynamics with this article. Dow Theory The Dow Theory, attributed to Charles Dow, lays out foundational concepts that many traders consider the basic principles of technical analysis. It postulates that stock market activities unfold in specific, non-random patterns influenced by human psychology. These patterns manifest in three primary movements: long-term trends, counter-trends, and daily fluctuations. Dow emphasised that market prices integrate all existing and foreseeable data. Consequently, established trends tend to endure until clear signs indicate their reversal. How It's Used Traders utilise the Dow Theory to recognise and confirm market trends. By distinguishing between primary and secondary movements, they can identify the overarching trend and any counter-trends or corrections within it. This distinction aids in making informed trading decisions, such as entering or exiting trades at optimal points. By watching for definitive signals that indicate trend reversals, traders can position themselves advantageously for potential upcoming market shifts. How It Was Developed The genesis of the Dow Theory rests in the series of editorials penned by Charles Dow for The Wall Street Journal. Through his keen observations of market movements and trends, he devised certain principles that eventually coalesced into the Dow Theory. Though Dow himself never consolidated his ideas into a singular "theory," his successors refined his observations into the framework recognised today. Wyckoff Method The Wyckoff Method delves deep into the interplay between supply and demand in the market, underpinned by the assertion that assets move in cycles propelled by institutional investors or "smart money." The method suggests that by grasping the motives and behaviours of these major institutional actors, traders gain an edge, given that these entities notably shape market trends. How It's Used The Wyckoff Method prioritises the relationship between price and volume. Traders, armed with this method, keenly observe price movements in relation to volume surges or declines, seeking clues to the actions of institutional players. By recognising accumulation (where "smart money" accumulates assets) and distribution (where assets are offloaded) phases, traders can discern potential future price directions. The method employs a systematic approach: defining current market trends, anticipating future movements by tracking institutional behaviour, and finally, establishing positions in harmony with these insights. Specific chart patterns, like springs or upthrusts, are signals used to validate the ongoing phase. How It Was Developed Richard D. Wyckoff, recognising the disadvantage at which retail traders often found themselves, embarked on a journey to level the playing field. He rigorously studied the strategies employed by the most successful traders of his time. Merging these findings with his own market observations, Wyckoff birthed a method that sought to illuminate the operations of the market's most influential players. Gann Theory The Gann Theory is an intricate system of technical analysis developed by W.D. Gann. It’s grounded in the belief that price and time are intrinsically interwoven, and this relationship can be harnessed to predict future price movements. Gann maintained that markets move in consistent patterns and rhythms, and by understanding these, traders can foretell potential price changes. How It's Used Traders employing the Gann Theory use a set of bespoke tools to decipher market behaviour. Among the most notable are the Gann angles, which are drawn between a significant bottom and top (or vice versa) at various predetermined angles. The Square of Nine, another Gann tool, is a root square that offers a horizontal and vertical axis, assisting traders in identifying price movements and potential turning points. Lastly, the Gann Fan is used to foresee areas of support and resistance by marking out angles that depict possible future price movements. By using these tools, traders attempt to pinpoint where the price might change direction, offering them strategic entry and exit points. You can find all of these tools and more in FXOpen’s free TickTrader platform. Head over there to get started in minutes. How It Was Developed W.D. Gann integrated ancient mathematics, geometry, and astrology to decode market movements. This synthesis resulted in the Gann Theory, a set of tools and techniques. His innovative approach significantly influenced technical analysis. His meticulous research and unique approach have rendered his contributions both legendary and influential in the realm of technical analysis. Elliott Wave Theory The Elliott Wave Theory, introduced by Ralph Nelson Elliott, posits that market movements manifest in specific, predictable wave patterns. Central to this framework is the belief that markets progress in a five-wave sequence and retract in a three-wave sequence, totalling an eight-wave cycle. This sequence is driven by collective investor psychology, oscillating between optimism and pessimism. How It's Used In application, traders deploy the Elliott Wave Theory to both decipher and forecast market trajectories. By discerning where they are within a particular wave sequence, they can anticipate the likely next move of the market. For instance, recognising the commencement of a third wave — typically the most robust and longest — can signal a strong trading opportunity. Conversely, identifying the start of a corrective wave can guide traders to defensive positions. How It Was Developed In the 1930s, Ralph Nelson Elliott identified recurring stock market patterns, suggesting predictability rather than randomness. He believed these patterns were fractal—repetitive at different scales. His research led to the Elliott Wave Principle, which provides a lens to understand and forecast market behaviour based on these wave patterns. Merrill Patterns Merrill Patterns, formulated by Arthur A. Merrill, are a collection of geometric formations discerned within stock market charts. These patterns reflect the collective psyche of market participants and underscore the principle that markets evolve in discernible trends. Merrill meticulously identified 32 W- and M-shape patterns, such as wedges, triangles, and head-and-shoulders formations, each harbouring unique predictive capacities about future price movements. How It's Used Traders leverage Merrill Patterns to gain insights into potential market shifts. By recognising the formation of a specific pattern, a trader can anticipate possible trend reversals or continuations. For instance, the emergence of a head-and-shoulders pattern can often indicate a forthcoming downward market reversal. On the other hand, a triangle formation typically signals the continuation of a prevailing trend. These patterns serve as visual cues, guiding traders in establishing their market positions. How It Was Developed Arthur Merrill extensively studied stock charts for decades, identifying recurring predictive patterns. He consolidated these findings into a compilation of patterns with defined rules. His work, "Behavior of Prices on Wall Street," systematically presents these insights, marking a significant contribution to technical analysis. Final Thoughts In understanding what technical analysis is in the stock market, these five theories are an ideal place to start. Each offers powerful, time-tested insights that provide a much deeper understanding of market dynamics than mere indicators or candlestick patterns. However, these theories are also used in other markets, including forex and commodities. To harness the power of these insights practically, consider opening an FXOpen account for a seamless trading experience. This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.
Education
by FXOpen
1
EWJ - How to identify a plausible targetThis idea is for investors as I'm analyzing the chart in weekly and trying to identify fair targets for a long position. First you need a donchian line which is basically the middle between the highest high and the lowest low during the last 52 weeks. Using this donchian line (nb. which is part of Ichimoku system as SSB line), you then identify the last "cycle" which is a clear half-wave with well-defined bottoms/tops. Applying the Fibo retracement tool using the top-bottom-top (or bottom-top-bottom) points of the identified wave, you'll end up with a set of Fibonacci levels. The different levels above 1.0 can be used as price targets as shown here.
AMEX:EWJEducation
by albert.callisto
How to ride trend and exit positions using Shlionz MAsBuy Signal: Trend Start: Buy when EMA 50 crosses above EMA 200. Pullback Entry: Buy when the price pulls back to MidBB or EMA 50 in an uptrend, with WMA 10 crossing above MidBB. Confirmation: EMA 5 crossing above EMA 10 (WMA 10) can serve as additional confirmation for entry. Sell Signal: Trend Reversal: Sell when EMA 50 crosses below EMA 200. Pullback Exit: Sell if WMA 10 crosses below MidBB or EMA 50 after a pullback. Confirmation: EMA 5 crossing below EMA 10 (WMA 10) can signal a potential exit or further downside. Risk Management: Stop-Loss: Below MidBB or EMA 50. Take-Profit: At key resistance levels or based on a risk-to-reward ratio. Implementation Summary. Buy Entry: EMA 50 crosses above EMA 200. Price pulls back to MidBB or EMA 50. WMA 10 crosses above MidBB. EMA 5 crosses above WMA 10 for confirmation. Sell Exit: EMA 50 crosses below EMA 200. Price closes below WMA 10 and MidBB. EMA 5 crosses below WMA 10 for confirmation. Incorporating EMA 5 adds a faster-moving element to your strategy, helping you to react more quickly to short-term changes and providing additional confirmation signals.
COMEX:GC1!Education
by shlionz
Best Swing Trading Strategies For Beginners (FOREX, GOLD) I am going to reveal 3 profitable swing trading strategies for beginners. These strategies are tailored for trading Gold, Forex or any other financial market. I will explain entry signal, stop loss and take profit placement for every strategy and share a lot of examples based on real trades that we took with my students. First, let's discuss key elements that unite these strategies. 1. All the strategies will be trend-following. It means that the trades will be taken strictly in the direction of the market trend. 2. All the strategies will be daily time frame based. Daily time frame will be the main time frame for the market analysis. 3. All the strategies are technical analysis strategies. The decision-making and market analysis will be strictly based on technical analysis: price action, support and resistance. Strategy 1: Break of Structure Strategy Break of Structure is a classic swing trading trend following strategy that is based on: 1. Bullish breakout of the level of the last higher high in a bullish trend 2. Bearish breakout of the levels of the last lower low in a bearish trend In a bullish trend, a bullish violation of the level of the last higher high and a candle close above that is a very strong bullish signal. It signifies the strength of the buyers and indicates a highly probable bullish continuation. A perfect entry point after a confirmed Break of Structure is the retest of the level of the last higher high. Stop loss is 1 ATR. Take Profit - the next key resistance. Look at EURCAD pair on a daily time frame. The market is trading in a bullish trend and we see a confirmed break of structure - a daily candle close above the level of the last higher high. Here is how the trading position should look. Take profit is the closest resistance based on a historic price action. Look how perfectly this trade played out. In a bearish trend, a bearish violation of the level of the last lower low and a candle close below that is a strong bearish signal. It signifies the strength of the sellers and indicates a highly probable bearish continuation. A perfect entry point after a confirmed Break of Structure is the retest of the level of the last lower low. Stop loss is 1 ATR. Take Profit - the next key support. Above, EURNZD is trading in a bearish trend on a daily and we see a confirmed break of structure - a daily candle close below the level of the last lower low. Here is how a short position looks - entry is on a retest of a broken structure, stop loss is 1 ATR and take profit the closest key support. 163 pips of pure profit were made. Strategy 2: Trend Line Strategy Trend Line is a classic swing trading trend following strategy that is based on: 1. Rising trend line based on higher lows in a bullish trend 2. Falling trend line based on lower high in a bearish trend In a bullish trend, higher lows may respect a rising trend line. Such a trend line will be a strong vertical support. It will provide a safe point for buying the market. Entry will be based on a test of a trend line. Take profit will be at least the level of the current higher high. Stop loss will be 1 ATR. When you are looking for a trend line in a bullish trend, remember a simple rule. A valid trend line should be confirmed by at least 3 touches and 3 consequent bullish reactions to that. For example, a rising trend line on a GBPUSD above will be invalid trend line because it is confirmed by just 2 touches. While the trend line that I spotted on USDCAD is valid, because it was already respected 3 times in a row in the past. Above is the valid rising trend line based on higher lows in a bullish trend. Here is how a swing long trend from that trend line should look. Stop loss is based on 1 ATR. Entry from a trend line. Take profit is based on the current higher high. Almost 300 pips were made. In a bearish trend, lower highs may respect a falling trend line. Such a trend line will be a strong vertical resistance. It will provide a safe point for selling the market. Entry will be based on a test of a trend line. Take profit will be at least the level of the current lower low. Stop loss is 1 ATR. When you are looking for a trend line in a bearish, remember a simple rule. A valid trend line should be confirmed by at least 3 touches and 3 consequent bearish reactions to that. The trend line on EURGBP above is invalid because 2 touches confirm it. While that trend line is valid and confirmed by 3 strong bearish reactions. In the example above, EURCHF is trading in a long term bearish trend. Lowers highs perfectly respect a falling trend line. It can provide a safe entry for swing short trade. Following the rules of our trading strategy, here is a swing short trade from that trend line. Stop loss is 1 ATR. Take profit is based on the current lower low. 250 pips of pure profit were made. Strategy 3: Higher Low / Lower High Strategy Higher Low / Lower High is a classic swing trading trend following strategy that is based on: 1. The last higher low in a bullish trend 2. The last lower high in a bearish trend In a bullish trend, the level of the last higher low composes an important horizontal support from where, with a high probability, a bullish wave may initiate. This level will provide a perfect entry for swing long trade. Stop loss will be 1 ATR. Take profit will be the resistance based on current higher high. USDCHF is trading in a bullish trend on a daily. The levels of the last higher low is a perfect point to buy the market . According to the rules, stop loss is based on 1 ATR. Take profit is based on the current higher high. Great winner and nice trade! In a bearish trend, the level of the last lower high composes a key horizontal resistance from where, with a high probability, a bearish wave will initiate. This level will provide a perfect entry for swing short trade. Stop loss will be 1 ATR. Take profit will be the support based on current lower low. Look at EURUSD on a daily. The pair is trading in a bearish trend. The level of the last lower high provides a safe point to sell the market from. That's how a short position should look based on the rules of the trading strategy. Stop loss is 1 ATR. Take profit is based on the last lower low. Entry is the level of the last lower high. Target was quickly reached. All these strategies are very accurate. It provides good reward to risk ratio and is very easy to understand and apply properly. Try one of these swing trading strategies and find the one that suites your trading style. ❤️Please, support my work with like, thank you!❤️
Education
by VasilyTrader
1
How I Nailed a Perfect Breakout Trade Using a Simple Strategy*The following Analysis is made by my Trading BOT* Analysis of Your Trade: Descending Channel: Formation and Breakout: The descending channel is well-defined, indicating a corrective phase following an impulsive move. The breakout above the channel suggests a potential reversal or continuation of the prior trend, which appears bullish. Entry Timing: You entered the trade after the breakout from the descending channel. This entry aligns with a strategy to buy at the break of a corrective pattern, capitalizing on the resumption of bullish momentum. Resistance Zone (Blue Area): Initial Resistance Encounter: The blue horizontal line represents a resistance zone where price consolidated and failed to break higher on the first attempt. This is a good spot to watch for confirmation of a breakout or reversal. False Breakouts: There are some upper wicks visible in this resistance zone, indicating possible false breakouts or liquidity grabs. This suggests that many traders might have been stopped out before the true breakout occurred. Price Action Post-Breakout: Sharp Move Down: After the breakout, price made a sharp move down to retest the previous resistance (now turned support), which aligns with the principles of market structure where old resistance becomes new support. Correction and Continuation: The downward move appears corrective in nature, forming a series of lower highs and lower lows within a descending channel, after which the price breaks out and moves upwards sharply. Risk and Reward Considerations: Stop Placement: If your stop loss was placed below the previous swing low or the bottom of the descending channel, this would be a strategic placement to avoid being stopped out by market noise. Take Profit: Your target seems to be well-placed, considering the previous highs or a key Fibonacci level. The green area likely represents the take-profit zone. Volume Analysis: Confirmation with Volume: The volume spike during the breakout from the descending channel and the subsequent move up indicates strong buying interest, which is a good confirmation signal. Key Takeaways for Future Trades: Pattern Recognition: Identifying descending channels and their breakouts is a strong skill that can be leveraged in various time frames. Risk Management: Your trade shows a good understanding of risk management, especially if stops were placed beyond significant levels to avoid market noise. Confirmation Signals: Waiting for volume confirmation during breakouts is an excellent strategy to avoid false moves. Suggestions: Multiple Time Frame Analysis: Ensure that your lower-time-frame trades are aligned with the higher-time-frame trends or setups to increase the probability of success. Post-Trade Analysis: Continue reviewing your trades like this to refine your entry and exit strategies, especially around key zones like support and resistance.
OANDA:XAUUSDEducation
by Adlercon333
How to Overcome Trading Psychology ChallengesHow to Overcome Trading Psychology Challenges Dealing with common trading psychology challenges involves identifying and addressing the emotional and psychological factors that impact performance. This means you need to know how to manage fear, greed, hope, and regret carefully. In this post, we’ll talk about forex trading psychology and proper emotional control. What Is the Psychology of Trading? Trading psychology focuses on the mental state of a trader and the emotions that could predetermine trading decisions. It represents the various aspects of an individual’s character and behaviours that influence their trading actions. The psychology of trading is just as crucial as knowledge about assets (currencies, stocks, and commodities), your previous experience, and your skill in determining price movements. Understanding Trading Emotions and Psychology Trading is all about psychology and actions that are based on what you feel. That’s why it’s paramount to learn as much as you can about this topic. This list may help you better understand common traders' problems and your personal feelings. You should know that you are not alone, and many people face similar cases. Identify your emotions. Recognise the emotions that you experience while trading, such as greed, hope, and regret. Let’s break down these concepts: - Greed is the desire to make more money than is reasonable or realistic. - Fear is the feeling of anxiety or panic when faced with market volatility/uncertainty. - Hope is the belief that a trade will turn around and become profitable. - Regret is the feeling of disappointment or remorse after making a losing trade. By clearly differentiating between these emotions, you will understand exactly what you are experiencing right now and how it could potentially affect your trading decisions. Create a plan. It’s a great idea to develop a trading plan that matches your trading style and includes a strategy you want to follow, with entry and exit points and risk management techniques. A good plan could help you stay focused on your goals. Practise risk management. Consider managing risk by using stop-loss orders and position sizing. This way, you may avoid large losses. Losses often trigger emotional reactions and lead to more irrational decisions, so keep this in mind and don't fall for the tricks your brain is playing on you. You can practise various strategies on our free TickTrader platform. For example, we have a strategy back tester, a detailed charting system, and advanced technical analysis tools. And to make it even more convenient for you, we have created a highly customisable, user-friendly interface where you can personalise each element of the settings panel. Test these instruments in various markets with FXOpen. Keep a trading journal. Experts believe that when you record your trades and the emotions you experienced during each of them, you will identify patterns in your behaviour and make adjustments to your initial plan. How to Have Emotional Control There are a lot of techniques on how to remain calm during trading, and we’ve chosen the most popular ones. Here’s what you could consider doing: 1. Practise mindfulness — mindfulness techniques, such as meditation and deep breathing, can help you stay calm and focused. 2. Take breaks — regular breaks during trading are wonderful tools to clear your mind and reduce stress. They help you avoid making impulsive decisions. 3. Stay disciplined — stick to your plan and avoid any decisions based on emotions. 4. Seek support — talk to other traders or a mental health professional if you are struggling with emotional control. Another important thing to talk about is confidence and awareness. If you make trades “blindly”, anxiety increases. And conversely, the more you know, the calmer you feel. Explore our blog to learn more about trading. Once you feel confident, you can open an FXOpen account to put your knowledge into practice. This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.
Education
by FXOpen
2