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Trading a Single Forex Pair: Choosing the Right One for SuccessNavigating the complexities of forex trading begins with choosing the right currency pair. Each currency pairing represents a unique relationship between two currencies, and mastering the dynamics of a single pair can offer traders a sharper edge. By understanding how a particular pair moves, traders can craft more effective strategies and reduce exposure to unnecessary risks. Understanding Currency Pairs In forex trading, a currency pair represents the value of one currency against another. For example, in the EUR/USD pair, the Euro (EUR) is the base currency, and the US Dollar (USD) is the quote currency. The exchange rate tells traders how much of the quote currency is needed to purchase one unit of the base currency. This core understanding is essential for crafting strategies based on price movement, market news, and economic indicators. Base Currency vs. Quote Currency: The base currency is the first currency listed in the pair and is the one being bought or sold. In EUR/USD, the base currency is EUR. The quote currency is the second currency, showing how much of it is required to buy one unit of the base currency. Types of Currency Pairs -Major Pairs: These are the most traded pairs globally, including the US Dollar (USD) and other major currencies such as the Euro (EUR), Japanese Yen (JPY), and British Pound (GBP). Examples include EUR/USD and USD/JPY. Major pairs are typically more liquid, offering tighter spreads and more predictable price movements. -Minor Pairs: These exclude the USD but involve other major currencies, such as EUR/GBP and GBP/JPY. While still liquid, minor pairs may have slightly wider spreads compared to majors. -Exotic Pairs: These involve a major currency paired with a currency from a smaller or emerging market, such as USD/TRY (US Dollar/Turkish Lira). Exotic pairs tend to be less liquid and more volatile, with wider spreads and higher risk. Key Factors for Choosing a Currency Pair When selecting a currency pair, consider several critical factors to optimize profitability and minimize risk: -Liquidity: High liquidity means you can easily buy or sell a currency without causing large price swings. Pairs like EUR/USD and USD/JPY are highly liquid, resulting in narrower spreads and lower transaction costs. -Volatility: Volatile pairs experience more dramatic price swings. While this can present opportunities for larger gains, it also brings higher risk. Traders should balance their appetite for risk with volatility when selecting a pair. -Market Hours: The forex market operates 24/5, with different trading sessions in various time zones. High liquidity occurs when major sessions, such as London and New York, overlap. Understanding which sessions affect the pair you’re trading helps optimize timing. -Economic Indicators: Macroeconomic data—such as GDP growth, inflation, and employment reports—play a significant role in currency fluctuations. Monitoring these indicators for the currency pairs you trade will help you make informed decisions. -Correlations: Some currency pairs are correlated with other markets, such as commodities or stocks. For instance, the Australian Dollar (AUD) is closely tied to commodity prices, while the Japanese Yen (JPY) is seen as a safe-haven currency. Recognizing these correlations can give you an edge when anticipating price movements. -Spread and Transaction Costs: The spread is the difference between the buy and sell prices. Major pairs like EUR/USD generally have lower spreads, reducing trading costs and improving profitability. Popular Currency Pairs and Their Characteristics -EUR/USD: Known for its high liquidity and stable trading conditions, EUR/USD is the most traded currency pair. Its price movements are influenced by economic data from the Eurozone and the United States, making it a favorite among traders seeking reliable trends. -GBP/USD (Cable): This pair is more volatile than EUR/USD, offering larger price swings, especially during the London session. It is sensitive to UK economic data and geopolitical events like Brexit, making it ideal for traders who prefer volatility. -USD/JPY: This pair is less volatile than others and is influenced by US and Japanese economic data. The Japanese Yen (JPY) is also seen as a safe-haven currency, attracting traders during times of global economic uncertainty. -AUD/USD: The Australian Dollar (AUD) is heavily influenced by commodity prices and economic data from Australia and China. It’s a great option for traders who want to capitalize on global commodity trends. -USD/CHF: The Swiss Franc (CHF) is another safe-haven currency, meaning this pair is often less volatile and attracts traders during periods of global instability. Developing a Strategy for Trading a Single Pair Choosing to trade a single pair allows you to focus and specialize, giving you a deep understanding of the pair’s movements, news impacts, and market conditions. Here's how to develop a successful strategy for trading one currency pair: -Monitor Economic News: For major pairs like EUR/USD, keep a close eye on economic data releases such as interest rates, employment reports, and inflation figures from the Eurozone and the US. News-driven trading strategies often work well with high-liquidity pairs like this. -Leverage Volatility: If you choose a more volatile pair like GBP/USD, focus on breakout strategies or trend-following approaches. These pairs can offer large price swings, but effective risk management is crucial. -Risk Management: Always employ Stop Loss orders to protect your capital, especially with more volatile pairs. Proper position sizing and diversification are also key to managing risk. -Analyze Correlations: If you trade a pair like AUD/USD, understanding its relationship with commodity prices or China's economy can enhance your decision-making process. Conclusion: Focus on One Pair for Mastery For traders looking to specialize, trading a single forex pair can be a strategic advantage. It allows you to concentrate on the nuances of one pair, build expertise, and reduce the risks associated with juggling multiple assets. Whether you choose the highly liquid EUR/USD or the volatile GBP/USD, mastering one pair simplifies decision-making and enhances your ability to react swiftly to market movements. In the world of futures or CFDs, focusing on a major pair like EUR/USD provides access to deep liquidity and tight spreads. With a strong strategy and the discipline to specialize, traders can avoid unnecessary distractions, manage risks more effectively, and enhance long-term success in the dynamic forex market. ✅ Please share your thoughts about this article in the comments section below and HIT LIKE if you appreciate my post. Don't forget to FOLLOW ME; you will help us a lot with this small contribution.
OANDA:XAUUSDEducation
by FOREXN1
5
Decoding the NFP Report: Trading Strategies.In the dynamic world of forex trading, strategies that cater to the ever-changing market conditions are invaluable. While fundamental analysis is widely embraced in stock trading, its effectiveness in the forex market is often questioned. Unlike the stock market, where financial statements can significantly impact individual stocks, the forex market is influenced by a myriad of factors, including central bank policies and political leadership. In this article, we explore the limitations of fundamental analysis in the forex market and delve into an intriguing momentum trading strategy centered around a key macroeconomic indicator—the Non-Farm Payrolls (NFP). This strategy harnesses the unpredictable yet powerful market reactions triggered by the release of NFP data, offering traders a unique opportunity to capitalize on momentum. Fundamental Analysis in Forex: Fundamental analysis, a staple in stock trading, faces challenges in the forex market due to its limited impact on currency exchange rates. Forex stability relies not only on economic indicators but also on the nuanced decisions of central banks and political leadership. Despite these challenges, successful forex trading doesn't necessitate rigid adherence to a specific scenario. Traders can leverage price momentum and increased liquidity to execute effective impulse trading strategies. Non-Farm Payrolls Trading Strategy: The Non-Farm Payrolls (NFP) trading strategy capitalizes on the release of crucial U.S. economic data—the Non-Farm Payrolls report. This multicurrency strategy is applicable to all currency pairs involving the U.S. dollar, allowing traders to explore numerous assets simultaneously. The primary objective of this strategy is to capture price momentum, making it adaptable to various time frames. Non-Farm Payrolls: Predictable Unpredictability: The NFP report, published every first Friday of the month, serves as a linchpin for speculative traders. It provides insights into the strength and growth of the U.S. economy, consequently influencing the value of the U.S. dollar. The report focuses on the non-agricultural sector, which contributes significantly to the nation's GDP. The sheer importance of the NFP report lies in its ability to reflect the health of the U.S. economy. The release of this data sparks maximum market volatility, with prices witnessing rapid fluctuations, often ranging from 100-200 points in a short period. However, interpreting the aftermath of the news poses a unique challenge due to the simultaneous release of unemployment statistics, which can sometimes contradict each other. Despite the inherent unpredictability, the NFP trading strategy capitalizes on the strong price spikes triggered by the news release. While predicting post-news price behavior may be challenging, the strategy offers a systematic approach to navigate and profit from the volatile market conditions that follow the NFP announcement. Rules of Non-Farm Payrolls (NFP) Trading Strategy: Stay Informed with an Economic Calendar: Use a reliable economic calendar to stay informed about upcoming NFP releases. The economic calendar will help you track the scheduled date and time of the NFP report. Check for News Release Postponements: Understand that postponements of data releases are common in economic calendars. Monitor the calendar regularly to stay updated on any changes to the scheduled release time of the NFP report. Utilize a Trusted Economic Calendar: Choose a reputable economic calendar platform to ensure accurate and timely information. The provided link www.tradingview.com can be a valuable resource for tracking economic events. Prepare for High Volatility: Recognize that the release of the NFP report triggers significant market volatility. Prepare for rapid price movements and be cautious about entering trades during the initial moments following the release. Focus on the Non-Agricultural Sector Employment Data: Prioritize the non-agricultural sector employment data within the NFP report. This indicator is crucial for gauging the strength of the U.S. economy and can have a substantial impact on currency pairs involving the U.S. dollar. Monitor Unemployment Statistics: Simultaneously track unemployment statistics released alongside the NFP report. While the primary focus is on non-agricultural employment, an understanding of unemployment trends can provide additional context for market reactions. Be Cautious of Contradictory Data: Acknowledge that data within the NFP report, especially non-agricultural employment and unemployment figures, may occasionally present contradictory signals. Exercise caution during such instances, as market predictability diminishes. Wait for Initial Volatility to Subside: Post NFP release, wait for the initial surge in volatility to subside before considering trade entries. Initial reactions can be impulsive, and waiting allows for a more informed decision-making process. Consider Multiple Currency Pairs: Since the NFP report influences the U.S. dollar, the strategy can be applied to various currency pairs involving the dollar. Explore multiple pairs simultaneously to identify the most favorable trading opportunities. Implement Risk Management: Prioritize risk management strategies to protect your trading capital. Set stop-loss orders and determine the appropriate position size based on your risk tolerance and account size. Practice on Demo Accounts: Before implementing the NFP trading strategy in live markets, practice on demo accounts to familiarize yourself with the dynamics of the strategy and refine your execution. Continuous Learning and Adaptation: Stay informed about changes in market conditions and continuously adapt your strategy. The forex market evolves, and traders need to adjust their approaches based on ongoing developments. By adhering to these rules, traders can enhance their effectiveness when employing the Non-Farm Payrolls trading strategy and navigate the unique challenges posed by this high-impact economic event. Traders often seek strategies to capitalize on this volatility, and one popular approach is the Pending Orders strategy. In this article, we'll explore the intricacies of the Pending Orders strategy , shedding light on its advanced nature and its application by both novice and experienced traders. 1 ) Pending Orders Strategy: Set Buy Stop and Sell Stop Orders: Minutes before the NFP publication, set two pending orders: Buy Stop and Sell Stop. These orders are strategically placed 25-30 points away from the current price to avoid simultaneous triggering due to heightened volatility. Manage Triggered Orders: When the price reacts to the news release, triggering one of the pending orders, promptly delete the other as a non-operational scenario. This prevents both orders from activating simultaneously. As observed in this image, during the latest NFP event on Friday, December 8, 2023, the price exhibited a robust bearish impulse immediately after the report release at 5:30 pm. This triggered our sell stop pending order, shifting our trade into a profitable position. Following the bearish movement, the strategy aims to close the buy stop position (the opposite direction). At this juncture, traders should take proactive measures to manage the open position. Stop Loss Considerations: Place a Stop Loss in the opposite order or opt not to set it at all, provided the second pending order remains intact to limit potential losses. This ensures that the remaining order acts as a safeguard against adverse market movements. Trailing Stop for Profit Maximization: Implement a Trailing Stop to secure profits. Continuously adjust the Trailing Stop as the price advances, allowing you to capitalize on the maximum price momentum. This dynamic approach helps lock in gains while navigating the evolving market conditions. As depicted in the image, the price, after experiencing a bearish movement, rebounds upward. What could be the reason behind this? The Non-Farm Payroll (NFP) report assesses the percentage of the total workforce that is unemployed and actively seeking employment in the previous month. For this specific event, the forecasted unemployment rate was 3.9%. However, the actual percentage revealed in the report was 3.7%, indicating a lower number of individuals unemployed and actively seeking employment in the preceding month. This positive deviation from the forecast serves as a favorable signal for the USD, prompting an upward movement in its value following the event. In currency markets, an 'actual' percentage lower than the 'forecast' is generally considered beneficial for the respective currency. By the way, Short-term trades had the opportunity to secure a few pips in gains after the activation of the Sell Stop order. Strategy N.2 Meanwhile, in this other image, I have marked a vertical line at the recent NFP event. Additionally, I've incorporated a 20-period Simple Moving Average (SMA) to illustrate the short-term trend. After the release of this significant economic news, you can observe an increase in volatility. This could serve as a component of a monthly strategy where the release of such news acts as a trigger. This second scenario or strategy, especially for beginners, is considered much safer. By analyzing the NFP report results, understanding economic dynamics, and gaining insights into the potential continuation of the trend or a possible pause for a reversal, traders can make informed decisions. In conclusion, it's essential to backtest the presented strategies and conduct a forward backtest in a demo account. Your thorough understanding and application of these strategies are crucial. Thank you for taking the time to read my article.
Education
by FOREXN1
3
1,2,3 Confirmation PatternWhat does it consist of? It consists primarily of 3 candles, and the fourth one is where we will enter the operation. In a bearish scenario the High of 2nd candle must be higher than the high of the 1st candle. The high of the 3er candle must be below the high of the 2nd candle. The 4th candle must re test the point of origin of the 3er candle. How can you use it? It is extremely important to complement and use this with a strong idea of where the price is heading. To know where the price will move, we need to understand that it moves towards the most liquid areas. The most liquid areas can be the unfulfilled Daily, Weekly, or Monthly lows and highs. Where should you place the entry? You should wait till the 3er candle close and place the entry at the point of origin of the 3er candle. Where should you place the stop loss? The stop loss should be above the 3er candle. Important I use this technique in D,W and M timeframes. After establishing a bias I look for the pattern. After the 3er candle is complete I move to 1hr or 15minutes to find the point of origin of the 3er candle.Then, I place the order.
Education
by Wiiso
3
why DCA is the best strategy for trading?Today I’ll be talking about what is Dollar Cost Averaging (DCA) and how is it used in trading. i will also shine a light on what importance it holds What is dollar-cost averaging (DCA): It is an investment strategy in which you invest a fixed small amount of money at regular intervals. This allows you to take benefit of a market bearish without risking excess funds Allowing you to keep up with greater liquidity and take benefit of market bullish. let's show that with examle : Let's imagine that there is a person called Cecilion and he invests in filusdt with a fixed amount of $ 20 every month. let's imagine the price of that currency in March was $ 5 Then Cecilion will have 4 pieces of filusdt in March. And in April, the value of filusdt fell to $4, and Cecilion bought it for the same amount ($20) to have 4 + 5 = 9 pieces of filusdt in april. And in May, the value of filusdt fell again to $2, and Cecilion bought it for the same $20 , so that he owned 4+5+10 = 19 pieces of filusdt in May. And in the following month, the price of filusdt raise to $10, and Cecilion bought it for the same $20, so that he owned 4+5+10+2=21 pieces of filusdt in June. let's do some math to show the efficiency of this strategy: - Cecilion invested $80 in 4 months and owned 21 pieces of filusdt to be The average purchase price is 80/21 = $3.8 - Let's imagine that Cecilion did not use this strategy and bought filusdt for $80 at once in March when its price was $5 Then a cecilion would have 80/5 = only 16 pieces of filusdt instead of 21 pieces. hope this article was useful to you and appreciated ur support with likes , comment and follow for more.🎯
Education
by ceciliones
22
✍️WEEKLY QUOTE: Remember the errors✍️..I advocate that you focus on eliminating your biggest errors, rather than trying to acquire new knowledge.. ..It may feel like you are taking a step back, but this is a very useful heuristic for learning, because you are always acutely aware of what your biggest leaks are, and it is a much more efficient way to progress. When you constantly chop off your C-trade errors, eventually your A-trade becomes your B-trade, and you develop an entirely new, better A-trade.. When you are simply working on preventing your biggest leaks, all you have to do is make an effort to remember not to do them. If you are falling out of the Zone, it is much easier to steady the ship when you have simple reminders of what not to do, then trying to apply 10 pages of notes on complex trading concepts. This was from How to Get in the Zone More Often – Minimize Active Learning by Jared Tendler
BITSTAMP:BTCUSDEducation
by Yelli_trades
18
Sinusoidal movement in channel, GalaIn this post, I am not referring to physics and math equations and probabilities, I'm just saying that the Display method of the probability of a numerical event is between 0 and 1, and just for easy recall in tutorials, I consider a number between 0 and 100. 0 indicates impossibility and we know that 100 indicates certainty. Therefore, will explain this price movement detection method in a simple and concise way. Consider a few general rules: 1- The price chart in a channel always tends to approach and return to the middle line of the channel. This is true for all types of the uptrend, downtrend, and neutral channels. 2- Sinusoidal movement is dynamic (of course, I mean in the financial market) and the range of movement, speed, and volume can vary. 3- the price chart after hitting the middle line, faces 3 possibilities. Usually, we consider these possibilities as 33 - 33 - 33 % 3-1- Reversal (pull-back ) to the previous direction. 3-2- Crossing the middle line and moving to hit the other line of the channel. 3-3- The price chart attached to the middle line of the channel continues to move. (I will publish the third point and its reasons in another post because this one is a complete and long tutorial for himself) 4- usually In uptrend and downtrend channels, the movement angle of 45 degrees is the most appropriate movement angle to create sinusoidal movements (consider between 30 and 50 degrees). And the 5: "Keep this last point in mind in all the training you read and learn from different people. From great masters in financial market analysis to an ordinary person like me " ** No theory, method of analysis, or analysis is ever 100% correct. In probabilities, we always have the nearest states, which means that when we say 100 for the certainty of occurrence, A probability may be up to 99.999999, but it is NOT 100%. So remember that there is always a possibility of a movement or change contrary to our analysis, rules, or imagination, and "This is one of the main reasons for placing a Stop-loss limit in trading" ----------------------------------- Please write any advice or suggestions. Dear friends, request any cryptocurrency pair, currencies pair for forex, and any index that you want to be analyzed and ask any questions. Thanks for your attention
Education
by Arash-RK
3
5 Reasons for and against trading forex 🤷‍♂️They make it look easy, posting lifestyle posts all over your Instagram feed.⠀ ⠀ Truth is, that's not real. 😒 Sorry.⠀ With that being said lets break this down into reason you should and shouldn't trade forex. The reason I'm covering this as a forex idea is I am predominantly a forex trader and made my way to where I am trading forex. This however does apply to any trading you might be thinking of getting involved with. So lets get into it👍⁠⠀ FIVE REASONS NOT TO TRADE FOREX 1. Can you afford to lose money? If you cannot afford to lose money or you are desperate to make money then this really isn't for you. Only trade with money you can afford to lose. If you are trading with money you really need to survive then your problems are about to get a whole lot bigger! 2. You don't know what you're doing! We have all been there at some point of not knowing what we are doing. But before even considering placing a life trade focus on learning and developing strategies. Focus in on the process and the desired outcome will naturally happen. We live in a world with so much resource and information at our finger tips. Go do the research before getting in to deep to quickly. 3. You can't handle it when you're wrong or you're losing. You will be wrong at times and that's okay. So long as your winners cover the losses. You also have to handle and learn that no matter how good of a strategy loser runs and periods of draw down happen to every trader. No one can be 100% right all the time. 4. You are risk averse. In any form of trading you are taking a risk. If you are to risk averse then it's really not for you. Risk management is key but if you are to averse trading wont fit your personality. 5. You don't have time. A lot of people say they want this and then say time is a factor stopping them. That's fine if you either make time and sacrifice or simply forget about trading. If time is precious and you really don't have time due to important life commitments then focus in on them. If you spend all your time on PlayStation and Netflix and say you haven't got time. Well then it comes down to lifestyle choice. We all want trading success few realise how time consuming especially at the start when learning it can be. There are also 5 good reasons why you should take up trading so lets cover them now. FIVE REASON TO TRADE FOREX 1. You want freedom Bored of working 50 hour weeks? Be your own boss take control of your own destiny. It's hard work but when achieved you'll wonder why you didn't do it sooner. Very fulfilling seeing your kids grow up instead of getting in at 7pm as they are tucked up ready for bed. ⠀ No more missing school sports days or the certificates in assembly.⠀ Time for more golf maybe? ⠀ Remember to do it for these reasons and not a big shiny Lambo. 2. You have learned the basics and understand the upsides and downsides. It's crucial to get educated and then still understand you will have up days and down days in trading. Don't even trade until you are emotionally sound with all possible outcomes when placing trades. You understand what is required along with being aware of the positives and the dangers. 3. You can deal with a high risk environment. You understand the risk at stake but above all else you understand and practise good risk management. Anxiety, worry, stress, not sleeping, losing money - I could go on.🤦‍♂️⁠⠀ If you're feeling any of the above you haven't ticked the box on this one. If you don't feel any of these you on the right path. 4. You are patient and will persevere. We all want that quick money. Social media makes us think it's easy Fast money fast cars, trips to Dubai. Commitment patience and dedication are the most important traits in trading. This is not an overnight success game it takes time and will to learn the skills needed. If you haven't got patience or commitment don't even bother. So much more to this than just placing a few trades on your tea break. 5. You can stick to a plan and understand probabilities. Once you have a plan that you have tested and take confidence in, understand probabilities and stick to it. If you're hoping from one thing to the next with no real time spent on one plan you not got the traits needed. If you understand probabilities and can let a proven plan with a known edge play out then your on the right track already. FINAL THOUGHTS Most fail - the common denominator in the ones that make it work are they don't quit.👍 Simple as that.😎⠀ Trading isn't for everyone. 🤯⁠⠀ ⁠⠀ Yes, there are upsides for sure - I touched on them. ⁠⠀ But it can be f**king horrible. 😢⁠⠀ The negative emotions when trading can hit hard. ⁠⠀⁠⠀ That's not how trading 'should' be or feel, but its still a reality for a lot of traders.⁠⠀ ⁠⠀ If you're chasing money, if you're desperate to make a quid or three - don't do it.👌⁠⠀ ⁠⠀ This isn't the game for you.⁠⠀ ⁠⠀ There is simply no room for desperation - it will quickly find you out.⁠⠀ If you can get emotions on point and a proven plan however the upsides are massive. The key here is knowing to grow and get to where you want to be will take time. ⠀ If you had more time doing whatever you wanted each day, that's pretty cool right?🙌⠀ ⠀ Going on holiday whenever you want - like tomorrow? Just because you can.⠀ ⠀ Or just chilling in your garden on a nice day ☀️⠀ ⠀ Whatever floats your ⛵.⠀ ⠀ Time for you? Prioritising your health and fitness because you have never had time before?⠀ ⠀ Exactly - the benefits are endless. But be ready to put the long hard miles in to get there and make sure you're doing it for the right reasons. ⠀ ⠀ Also, the cost to start this is like no other 'business' you could go and start.⠀ ⠀ No stock, no big start up costs - just you and your initial deposit. ⠀ ⠀ However big or small that may be it doesn't matter.⠀ ⠀ Learn to trade properly and there are now a wealth of funded trader programmes that can give you the freedom you crave without you having to save up for a lifetime. Focus on getting your process right and then enjoy the inevitable outcomes. Thanks for looking and enjoy your weekend. Darren 🙌
Education
by pow_removetheguesswork
1
The analysis of the behavior of major player Part 1I would very much like to share with you my knowledge about the behavior of large players in the market, how to notice them and how to use it. It's very interesting and in fact you can talk about it for a very long time, people have been studying these strategies for years. I will try to explain the simplest first, this will be the first part. If you look at the chart that I have shown, you will see the level underlined with a blue line, this is it, the stops of a major player, in the event of a breakdown of this level, a major player will exit by stops, which means a sale, since closing by stops for the exchange is tantamount to sale. Thus, at this moment, the price is guaranteed to go further down.😉 It was a first part. Best wishes. I will happy to see you in next parts😊
Education
by MiriamRapoport
Why Traders Suffer From Analysis Paralysis In TradingAnalysis-Paralysis In Trading This is an article I’ve been avoiding. Maybe it’s cos’ I’m guilty of it. You know, A bunch of knowledge makes—jack cross the rubicon. It’s December 1, 1990. ugh… what a glorious day! I mean—I’m grateful I survived. Are you? (rhetorically—cos’ I talk to myself a lot). Anyway, I finally get to attend “School of Candles” in Pretoria. South Africa is a great country but, only because they have one of the best—Trading schools in the world. Hashtag “respectfully” . I mean—Finally! Heh… I’m here. The Oakland… miserable red-collar guy is here. Can you believe it? Considering all the blown accounts and failed trades—I finally left the country to… South Africa. Pfft… Don’t mind my excitement—at least—I’m not sitting on my a*s reading this article because I have a problem. You are! i’m pretty sure you haven’t travelled out yet and it’s cos’ you keep losing. You’re a loser! At least… someone had to tell you. Don’t worry that makes two of us. Yeah—you and uh… you! Ugh… duh… I know you are not here for my—school of candles story. You’re here cos—you are stuck! Am I right? Anyway, I’ll help I promise. But, you have to promise me that I won’t be wasting my time. Do you promise? Okay—Great. So… Analysis Paralysis In Trading (What Does That Even Mean?) Look at them… so peaceful. Quick question—Have you ever really stopped to watch kids play? The laughter, glee, ambience, passion—so peaceful; so serene! These guys literally have nothing to worry about. Don’t you miss that? When last did you laugh? No… like actually laugh. These days—we have to watch a funny illiterate online to… crack up. How miserable can one’s life be? So sad; so depressing and why’s that? I don’t know about you—but, I miss those days. Nothing to worry about. You’re probably wondering, “What’s he on about?”… I just had to remind you of what your life (hopefully you’re still breathing)… is supposed to feel like. Before… I tell you how it actually feels like. That’s why you’re here right. Shucks. Analysis paralysis—wonder who comes up with these names. In a lame man’s term, it’s basically being paralyzed (not literally) from over-thinking. over-researching and over-analyzing… Why do we do these things; why do we even do anything. Imagine the thought of—mentally paralyzing yourself… Do you love yourself at all? Of course not—Humans (you reading this now) think of the possible worst for—every situation. Imagine… You go out and a complete stranger gives you money, from nowhere; out of the blue. What’s the first thing that comes to your mind? Be honest, Don’t lie. That’s what I thought. Anyway, Being completely mind-paralyzed is bad. I mean … have you seen—how they have to literally drive paralyzed people everywhere… They become furnitures (not trying to be insensitive); they really can’t do anything… on their own. You’ll end up—A furniture trader! Analysis Paralysis In Trading (How Can You Tell?) In school (school of candles), I attended every class. Wyckoff 101, Fibonacci 203 (borrowed course), Way of the candles, Price-action 105, Order blocks and Market structures 103, Supply and Demand, Indicators not manipulators… Weird ones! I took all. Trust me —I was a diligent student. But, I had no direction. I practically learned everything and anything. I mean—I wanted to be a great trader (don’t we all). The next class (Final year) required… Mastery. I realized that—sticking to one thing was a problem. Oh! No, I can’t choose. I literally attended all classes—just to find out what was best for me—even after taking these classes… in my first year. Hello Jane, I know this is kind of awkward… But, what’s your major? Uh… Order blocks. Imagine! I couldn’t even come up with something. What the H-E-L-L do you want Jamal? You’re just going round in circles. I couldn’t choose. Wanted to take action but, how could I? No one gave me the memo. I don’t even know what making decisions feels like. “Making Decisions” suddenly sounds like the strangest word in—the dictionary. So, tell me have you been in this position. All you keep doing is learning—anything; everything. But, no actions! Two ways you can tell: Can’t seem to make a decision. Always looking for a better solution—without actions! For analysis paralysis in trading It’s not something you can cheat. As a trader, You can’t go over or under it—Dealing with it is… the only solution. You keep delaying actions—whilst over-analyzing every situation. For this trader—you keep imaging downsides… Always the negatives; never positives. Imagine taking a trade—but, you’ve already imagined—300 scenarios of your plan going badly. Pfft… heh—who does that? Uh! you. You’re literally mentally paralyzed. What other options do you have than over-thinking everything. Are You Asking The Right Questions? Ta-ta… I envy them so much. Anyway, You learn to be in the comfort zone because… Why stress your brain till it’s paralyzed. Your brain is literally “yours truly”—It would always try to keep your safe. It will protect you, which is good. But, you become safe and unsuccessful. In trading, which do you prefer? Actually making a decision irrespective of the outcome or… staying out and avoiding everything. I mean if we’re being honest—the second option looks safe and comfortable. Will you choose that though? Remember you want to be rich; you want financial freedom. Even if you go through hell—do it without hesitations. Yup—That quote is a reference to the previous sentence. Eh… your lack of decision making will only make you—miss out on a million market opportunities. So, are you asking the right questions? When you literally ask yourself the right questions… It gives room for a clearer thought process and faster decision-making. Honestly though—Let’s blame google. An increase in options; an increase in choice. The fear of making the wrong choice arises. Then you become mentally paralyzed. Most traders today are stuck. I remember meeting a guy (Joe)—In one of my trading communities—in school. This guy found it hard to make a decision. Heh… So he buys and sells at the same time. Analysis paralysis in trading can make you a fan of gambling. But, there’s a solution… You can start by answering the right questions. What are the right questions? Is it worth the risk? Will it matter in 5 minutes? What was my first choice? Can you answer these questions? Make it a habit to answer these questions before—you take a trade. Not just trading—anything at all… Train that brain of yours. Is It Worth The Risk? You know some-times the best way to eliminate choices is to—know the risk attached to each choice. Imagine having a $50 account (your only money) and trying to take a trade. You’ll probably over-think every thing because—you just can’t lose that money. I mean… Heh—that’s all you have right? So, the first question should be… “If I take this trade, is it worth the risk”. Note that… you might lose—but, the keyword here is “risk”. How much are you willing to let go of?… That should be the first thought. Try this exercise and you have to be truthful—always!… If I was given $50 and I was told to give someone $5 (out of your $50)… Would I be okay with that? If you will, then you can decide to risk 10% of that account—knowing that you won’t feel bad if you lose. Ergo, You’ve just made a decision—because you eliminated your options. I mean losing 10% of $50 is better than losing all. Now what next? you need to eliminate all trades that will make you lose more than 10%. See, No mulling— just progress. Note that… Not all trades are negatives. But, we should always consider the risk. Will It Matter In 5 Minutes? Now you know the risk you’re willing to take, the next question is—Will it matter in 5 minutes? Ever heard of the “5 by 5 rule”? Well, the 5 by 5 rule states that—if you come across an issue take a moment to think—whether or not it will matter in 5 years. If it won’t, don’t spend more than 5 minutes stressing out about it. Forget the “5 years”—My own 5 by 5 rules is… don’t waste 5 seconds pondering over it, if it won’t matter in 5 minutes. Mine works right? I mean… 5 years is a pretty long period you know. By the way, the market waits for no man. The fact of the matter is, there are some problems that do not need your full attention. Why stress over some money you’re okay losing. If after 5 seconds you’re cool with it then—go ahead! Do me a favor. Let’s practice… Um—can you remember what you just did 5 seconds ago? If you can, it matters; If you can’t, “It’s irrelevant and doesn’t matter. There, fixed right! What Was My First Choice? The human mind is like a sick computer virus. It’s basically, randomly, just processing relevant and irrelevant informations and thoughts. You tend to have all these choices, thoughts and feelings all mixed up—especially during pressure. I was listening to Roger Khoury the other day and he said, “When driving a car in a—calm state—you’re basically just following the rules of the road right? But, what happens when you’re late for a meeting—You find yourself breaking all these rules.” Similarly… same applies to the market. You don’t have time; you’re supposed to make a decision—If not, the market leaves you. Then if you’re like me that attended all classes in—Pretoria, you probably don’t have a particular strategy. Different options; different opinions. What happens? You become paralyzed! All this can be avoided if you remember your first choice. Many traders fail to understand that our gut feelings, our instincts—matter. Where do instincts come from? In as much as the brain behaves sick sometimes—It also stores useful informations… knowingly or unknowingly. These useful informations are usually processed when needed. Do you ever know something and wonder—how you know that thing? It’s cos’ you probably already came across that stuff but, you ignored it. Cos’—It didn’t matter. But, look who wasn’t ignorant “your brain” yeah, remember… “Yours truly” loves you. Those first choices… are thought of for a reason. So, make them your last resort—always! Havoc Of Analysis Paralysis In Trading Hey guys, my name is Jamal and I’m a victim of Analysis Paralysis in trading … “Hey Jamal”… Sounds familiar. Yeah, group home. My encounter with Analysis Paralysis in trading wasn’t a great one. There were consequences. Each with its own baggage. After I narrowly graduated from the School of Candles, Pretoria. I mean I’ve learnt everything—I was ready for the market. On Tuesday, May 3, 1994, I deposited $50,000 to my trading account. As a graduate of School of Candles—what was the next thing? To get into the real world of trading . A nasty encounter in the market occurred. I found a GJ (gbp/jpy) trade, the daily had a bearish head and shoulder, the—4 hour, a double bottom. On my chart, I had Bollinger bands, Moving averages, Relative strength index… Name it. Yeah —I was that confused. Didn’t know if to—buy or sell. Oh! No, a clash of interest. My indicators… some gave me buy signals; others sell signals. Oh my God! What now? What’s the direction—Now I’m exhausted, tired, I can’t think straight! The market decides to buy… Yeah, I guess I’ll go long now. The sound your phone makes when you just placed a trade. Greedy old Jamal, used 2 standards for US30 on a $50,000 account. I was more than confident. The market does it thing. What! no… no… n0—Why is there a sell taking place now? No! The Havoc That’s it… That was so easy I lost it all. Everything! “What was the point of school then?” I thought. Useless! You’re so useless Jamal. You can’t get anything right. I couldn’t make a decision… My brain said, “Pause”. I was paralyzed and I failed. Three things happened to me: My trading performance reduced Creativity was gone. Couldn’t decide on a strategy and all patterns became useless. Lost my willpower. I couldn’t make a decision—too many options. Thank you for listening! “Thanks for sharing Jamal”. How To Overcome—Final Words Don’t ask me what I went to a group home to do. Analysis paralysis in trading affects you mentally—It builds into a habit and you become the hesitant trader. Do you remember him? That guy who couldn’t make decisions, that insecure coward. Yeah—that was who I became. June 23, 1994, I was in bed. Thinking, crying, staring—”What went wrong?”, I thought. How come… I mean i’ve gone to one of the best schools, learnt everything there is to learn, and graduated with a 2:1. So, what exactly is the problem. I discover that—I was. “Jamal you are the problem”—I discovered 6 things. These 6 things I’m going to tell you are very important. I’m telling you because—I love you. You shouldn’t follow my past; you shouldn’t make my mistakes. My mom’s teaching helped. Remember when she gave me the trading elements and principles… Steps To Overcoming This Nuisance. This is the truth; this is my truth. After a month I discovered that: You need to trust you. No one else opinion matters in the business of trading. It’s your business—You should mind it. Limit the amount of research (information you consume) you do. It’s called “learn and earn” for a reason—Not “Learn and continue learning”. Talk to someone. If you think you’re stagnant, you need to pour out all those information—on someone. Teach them! Perfection isn’t the key. Progress is! Know your end goal always. Notice every thoughts and emotions. If possible, write them down. If you follow this manual, you should never have reason to be stuck or mentally paralyzed. Remember sharing is caring! Tell someone about this article. Most traders have no idea what analysis paralysis in trading is.
OANDA:NAS100USDEducation
by lazyluchi
2
How To Measure Volatility Easily|Advanced Usage Of BBHi traders! As we said in the last article it’s kinda complicated problem to measure volatility. However, it’s one of the most important features of market. Any strategy directly depends on the volatility level of coin. Moreover, it provides signals of entry and exit. BB Width is one of the most accurate tool to measure volatility. The Bollinger Band Width is the difference between the upper and the lower Bollinger Bands divided by the middle band. This technical indicator provides an easy way to visualize consolidation before price movements (low bandwidth values) or periods of higher volatility (high bandwidth values). The Bollinger Band Width uses the same two parameters as the Bollinger Bands: a simple moving- average period (for the middle band) and the number of standard deviations by which the upper and lower bands should be offset from the middle band. How does it works? During a period of rising price volatility, the distance between the two bands will widen and Bollinger Band Width will increase. Conversely, during a period of low market volatility, the distance between the two bands will contract and Bollinger Band Width will decrease. There is a tendency for bands to alternate between expansion and contraction. When the bands are relatively far apart, that is often a sign that the current trend may be ending. When the distance between the two bands is relatively narrow that is often a sign that a market or security may be about to initiate a pronounced move in either direction.
Education
by Skyrexio
Learn how to use the head and shoulder pattern in TradingViewIntroduction of Head and Shoulders Pattern Technical analysis is a necessary thing to select the positions of perfect entry and exit. For that, There are many patterns available for trading, the head and shoulders pattern is one of them. This article is all about the head and shoulders pattern. In simple words, this pattern includes three triangles. The first triangle is on the left side, and the second one is on the right side, the last one is in between these two. This, the last triangle is the highest in the height, which is called the head, the other two are called the shoulders. What’s Head and Shoulders? There will be three vertices or bottom points in a certain price area, but the second apex or bottom point is higher or lower than the other two vertices or bottom points. This type is called the head and shoulders type. One with top and two shoulders is head and shoulder top; one with two shoulders is head and shoulder bottom type. However, sometimes there may be more than three vertices or bottoms. If there are one or two heads (or bottoms), two left and right shoulders, it is called a compound head and shoulder top (or compound head and shoulder bottom). The W bottom pattern is an important pattern in morphology, and its trend looks like the English letter "W". The W bottom pattern is a mid-term bottom pattern. It usually occurs at the end of a swing downtrend, and generally does not appear in the middle of a market trend. A mid-term short market must correspond to a mid-term bottom, that is, a W The brewing time of the bottom has its minimum period rule, so the shaping period of the bottom W is a necessary condition for judging the authenticity of the shape. The components of the bottom W have the following two conditions: There must be at least a relatively long distance between the first low point and the second low point of the bottom of W. Sometimes there will be short-term double bottoms in the market. This cannot be regarded as a bottom of W, but only a small market. Rebound at the end, and it is often a trap. The transactions at the first low point are relatively active, while the transactions at the second low point are extremely dull. Moreover, the appearance of the second low point is usually slightly arc-shaped. Therefore, the W bottom pattern has the characteristics of a left-pointed right circle. The formation of the bottom W pattern is due to the fact that after the long-term price decline, some investors who are optimistic about the market outlook believe that the price is already very low and has investment value, and the anticipatory buying is active, and the price will naturally rise, but this will affect the large investment institutions to absorb low-cost chips. Therefore, under the pressure of large investment institutions, the price has returned to the first low point, forming support. The fall this time hurt the enthusiasm of investors, and the shape was arc-shaped. There are two low points and two rebounds in the bottom W pattern. From the first high point, horizontal neckline pressure can be drawn. When the price breaks upward again, it must be accompanied by active transactions before the bottom W is officially established. If the upward breakthrough is unsuccessful, the exchange rate must continue to be adjusted horizontally. After the exchange rate breaks through the neckline, the neckline pressure becomes the neckline support, and the exchange rate will retreat at this time. The exchange rate temporarily retreats to the vicinity of the neckline. After the retreat ends, the exchange rate begins to rise in waves. Generally speaking, the second low point of the W bottom pattern is better than the first low point, which can create a bottom-breaking atmosphere and let retail investors out, thus forming a relatively concentrated bottom of chips to facilitate the pull of large investment institutions. Head and shoulders are the reversal patterns. That includes the concept of the bearish and bullish trend. In this pattern, there would be a one trend line, reacts as support, all three triangles are connected with that, called a neckline. If the trend crosses the neckline, there will be a change in the trend. By this, we can decide the trend (upward or downward). The next is the bearish head and shoulders (top reversal) and the bullish head and shoulders (bottom reversal). Bullish Head and Shoulders (Figure B): In this, the trend enters by falling. And makes the head and shoulders pattern by breaking the neckline. Then it will jump and make an uptrend by crossing the neckline in an incremental way. Bearish Head and Shoulders (Figure A): The trend initials in the uptrend further it crosses the neckline and makes the Head and Shoulders pattern and then after, by breaking the neckline, it will fall. It calls Top reversal, too. In-depth Description of Head and Shoulders Pattern: ============================================== The reversal pattern refers to the pattern formed by the reversal of the stock price trend, that is, the signal that the stock price turns from an uptrend to a downtrend, or from a downtrend to an uptrend. 1. The pattern analysis The head and shoulders trend can be divided into the following different parts: (i) The left shoulder part-lasts a period of ascending time, the trading volume is very large, in the past, people who bought at any time were profitable, so they started to get Profit-selling caused a short-term decline in the stock price, and the turnover was significantly reduced when it reached its peak. (ii) Top, After a short period of time, the stock price rose again strongly, and the transaction also increased. However, compared with the left shoulder part, the highest point of trading volume has significantly decreased. The stock price rose above the previous high and then fell again. The trading volume also decreased during this down period. (iii) The right shoulder part-the stock price fell to close to the last down low point and then gained support to rebound. However, the market investment sentiment was significantly weakened, and the turnover was significantly reduced compared with the left shoulder and the head, and the stock price could not reach the head high The point fell back, and the right shoulder part was formed. (iv) Breakthrough, Fall from the top of the right shoulder and break through the bottom neckline connected by the bottom of the left shoulder and the bottom of the head. The extent of the breakthrough of the neckline must exceed 3% of the market price. Simply put, the shape of the top of the head and shoulders presents three distinct peaks, one of which is in the middle is slightly higher than the other two peaks. As for trading volume, there was a cascading decline. 2. Market meaning The head and shoulders is a technical trend that cannot be ignored. From this pattern, we can observe the fierce competition between the poor and the weak. At the beginning, the optimistic forces continued to push the stock price up, the market investment sentiment was high, and a large number of transactions occurred. After a short-term downturn adjustment, those who had experienced the last uptrend of germanium bought during the adjustment period, and the stock price continued to rise. At the second high point, the market appears to be healthy and optimistic on the surface, but the transaction has been much lower than before, reflecting the weakening of the buyer's power. Those who did not have confidence in the prospects and missed the last high point and profit-taking, or those who bought at the falling low point for short-term speculation all sold, and the stock price fell again. The third rise provides an opportunity for those investors who later realized that they missed the opportunity of the last rise, but the stock price is unable to rise above the previous high, and when the trading volume drops further, it is almost certain that the past bullish optimism is almost certain The mood has been completely reversed. The future market will be weak and weak, and a sharp drop is about to come. The analysis of this pattern is: (i) This is a turning pattern of a long-term trend, which usually appears at the end of a bull market. (ii) When the trading volume of the most recent high is lower than the previous high, it implies the possibility of head and shoulders; when the stock price cannot rise to the previous high for the third time, trading will continue When it drops, experienced investors will seize the opportunity to sell. (iii) When the head-shoulders-top-neckline breaks, it is a real sell signal. Although the stock price has fallen by a considerable amount from the highest point, the decline has only just begun. Investors who have not shipped yet continue to sell. (iv) When the neckline breaks below, we can predict which level the stock price will fall to according to this type of measurement method of least drop. The method of this measurement is to draw a vertical line one by one from the highest point of the head to the neckline, and then start at the point where the right shoulder breaks through the neckline, and measure the same length downwards. The price thus measured is the stock price. The smallest drop. 3. Tips (i) Generally speaking, the height of the left shoulder and the right shoulder are roughly equal, and the right shoulder on the top of the head and shoulders is lower than the left shoulder. But if the height of the right shoulder is higher than the head, the pattern cannot be established. (ii) If its neckline slopes downward, it indicates that the market is very weak. (iii) In terms of trading volume, the left shoulder is the largest, followed by the head, and the right shoulder is the smallest. However, according to some statistics, about one-third of the head and shoulders have more turnover on the left shoulder than the head, one-third of the turnover is roughly equal, and the remaining one-third have more turnover on the head than the left shoulder. . (iv) When the neckline breaks, there is no need to increase the turnover. If the turnover increases sharply when the break, it shows that the selling power of the market is very strong, and the stock price will decline more rapidly as the turnover increases. (v) After breaking the neckline, there may be a temporary rebound (post-draw). This situation usually occurs when a break of low volume occurs. However, the temporary recovery should not exceed the neckline level. (vi) The head-and-shoulders top is a very lethal form, and its drop is usually greater than the smallest drop measured. (vii) If the stock price finally rebounds at the neckline level and is higher than the head, or if the stock price drops below the neckline and then rises above the neckline, this may be a failed head and shoulders and should not be trusted. Reversal pattern-head and shoulders bottom =+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+= 1. The shape analysis [ Figure B ] is the same as the shape of the head and shoulders, except that the whole shape is reversed, also known as "inverted head and shoulders". When the left shoulder is formed, the stock price drops and the trading volume increases, followed by a secondary increase with a small volume. Then the stock price fell again and fell below the lowest point of the last time, and the trading volume increased again with the decline, which was more than the trading volume during the rebound phase of the left shoulder-forming a head; when it rebounded from the lowest point of the head, the trading volume was May increase. The volume of the entire head is more than that of the left shoulder. When the stock price rebounded to the last rebound high, there was a third fall. At this time, the trading volume was obviously less than that of the left shoulder and head. When the stock price fell to the level of the left shoulder, the decline stabilized, forming the right shoulder. . Finally, the stock price formally instigated an upward trend, and accompanied by a large increase in transactions, when the neckline resistance broke through, the transaction increased significantly, and the whole pattern was established. 2. Market meaning The analytical significance of the head and shoulders bottom is no different from that of the head and shoulders top. It tells us that the past long-term trend has been reversed. Stock prices have fallen again and again, and the second low (head) is obviously lower than the previous one. The price was low, but it quickly turned around and bounced back. The next fall, the stock price fell to the last low level and has gained support and rebounded, reflecting the optimistic forces that are gradually changing the market’s past weakening situation. When the high resistance line (neckline) of the two rebounds breaks, it shows that the optimistic side has completely knocked down the weak side, and the buyer replaces the seller to completely control the entire market. 3. Tips (i) The shape of the top of the head and shoulders is similar to that of the bottom of the head and shoulders. The main difference lies in the volume. (ii) When the head-shoulders-bottom-neckline breaks, it is a real buy signal. Although the stock price has risen by a certain amount compared with the lowest point, the upward trend is only just beginning. Investors who still suggest buying should continue to chase. The method of measuring the least increase is to draw a vertical line from the lowest point of the head to intersect the neckline, and then start at the point where the right shoulder breaks through the neckline, and measure the same height upwards. The measured price is that the stock will rise. The smallest amplitude. In addition, when the neckline resistance breaks, there must be a surge in volume, otherwise it may be a wrong break. However, if the transaction gradually increases after the breakthrough, the pattern can also be confirmed. (iii) Generally speaking, the head and shoulders pattern is relatively flat, so it takes a longer time to complete. (iv) After breaking through the neckline, there may be a temporary fall back, but it should not fall below the line. If it falls below the neckline, or if the stock price falls back at the neckline level, the neckline resistance cannot be broken, and it falls below the head, this may be a failed head and shoulders pattern. (v) Head-and-shoulders bottom is one of the most predictive patterns. Once confirmed, the increase will mostly exceed the minimum increase. Reversal pattern-compound head and shoulders =+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+= 1. [ Figure A & B ] Shape analysis The compound head and shoulders type is the deformation trend of the head and shoulders (head and shoulders top or head and shoulders bottom), and its shape is very similar to the head and shoulders, except that the shoulder, head, or both appear more than once at the same time, roughly It can be divided into the following categories: (i) One-head and two-shoulder style: One head has two left and right shoulders of the same size, and the left and right shoulders are roughly balanced. More often is a pair of right shoulders. When the first right shoulder is formed, the stock price does not immediately fall below the neckline, but instead turns to rebound, but the rebound stops below the right shoulder height, and finally the stock price continues to follow the original The trend is down. (ii) One-head and multiple-shoulder style: The general head-and-shoulder style tends to be symmetrical, so when two left shoulders are formed, it is likely that one shoulder will also be formed. Except for the volume, the left and right half of the graph is almost identical. (iii) Long-headed and multi-shouldered pattern: During the formation of the head, the stock price has risen again and again, and it has risen to the same high level as last time before falling back down, forming two obvious heads. Trend. One thing must be noted: the volume of the second head tends to decrease compared to the first one. 2. Meaning market analysis significance complex head and shoulders patterns and common type of head and shoulders patterns as when appears at the bottom, it means that a longer-term rising market around the corner; if appear at the top, that the market will become more fall. In the initial stage of forming a compound head and shoulders pattern, the volume may be irregular, making the pattern difficult to identify, but after a while, it is easy to see that it is exactly the same as the head and shoulders pattern. Many people overestimate the expected rise (or fall) power of the compound head and shoulders pattern. In fact, the power of the compound head and shoulders pattern is often weaker than the ordinary head and shoulders pattern. When a mid-term trend appears, the compound head-and-shoulders pattern completes its minimum increase (or decline) and then no longer continues, while the increase (or decline) of the ordinary head-and-shoulders pattern is often the most measured big. 3. Key points (i) The minimum increase/decrease measurement method of the composite head and shoulders pattern is the same as that of the ordinary head and shoulders pattern. (ii) It is difficult to draw the neckline of the composite head-and-shoulders pattern, because each shoulder and the falling part of the head (the bottom of the composite head and shoulders is the rising part), not all fall on the same line. Therefore, the two most obvious short-term lows (compound head and shoulders are short-term rebound highs) should be connected to form a neckline. In addition, it may be connected to the neckline at the level where the price has fallen (or rebounded) the most times. Reversal pattern-single-day (double-day) reversal =+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+ 1. Pattern analysis [ Figure B ] When a stock continues to rise for a period of time, the stock price is suddenly and unusually pushed up on a certain trading day, but it is immediately under strong selling pressure, and all the gains of the day are completely reduced. If you fall more and close at the lowest price of the day (or close to the lowest price of the day), this trading day is called the top one-day reversal. Also when it fell, the stock price suddenly fell sharply on a certain trading day, but it was immediately supported by strong buying. All the declines of the day may be increased, and the highest price of the day (or close to the highest price of the day) Price) closes, this is the bottom one-day reversal. The two-day reversal is a deformation of this pattern. In the process of rising, the stock price of the stock rose sharply on a certain trading day and closed at the highest price of the day. However, after the stock price opened at yesterday’s closing price on the next day, the price continued to fall throughout the day. It is the closing of the lowest price of the previous day, and the performance of this trend is called the top two-day counter. Also when it fell, the stock price suddenly fell sharply on a certain trading day, but the following trading day completely recovered the lost ground and closed at the highest price of the day, which is the bottom two-day reversal. 2. Market implications Let us take the bottom one-day reversal as an example to explain the cause of this phenomenon. During the downward phase, as the stock price continued to fall, more and more investors were unable to bear greater losses, so they stopped loss and sold. Their selling further pushed down the stock price, and the lower price made them more eager to sell, which caused the price to fall sharply that day. When they finished selling, the selling pressure suddenly disappeared. Other investors tried to buy because of the lure of new low prices and immediately made profits. Therefore, more investors joined the ranks of buying. The order has been completely digested, so the buying order quickly pushed up the stock price, bringing back all the prices that fell that day. The market meaning of the one-day reversal pattern has at least two points: (i) The market temporarily peaks (when the top one-day reversal occurs) or bottoms (when the bottom one-day reversal occurs). The top one-day reversal usually occurs in the late period of a consumable rise; the bottom one-day reversal occurs at the end of the panic selling. (ii) This is not a signal of a long-term trend reversal. It usually appears at the top of the consolidation pattern, although it may also appear at the peak (or bottom) of the long-term trend. 3. Key points revealed (i) On the day of the single-day reversal, the transaction volume suddenly increased, and the price fluctuation range was very large, both of which were significantly larger than usual. If the trading volume is not high or the price volatility throughout the day is not large, the pattern cannot be confirmed. (ii) The volatility of the stock price within one or two hours may be greater than the volatility of the usual three or four trading days. When the top one-day reversal, the stock price opened a lot higher than the previous trading day, but the situation quickly reversed, the price quickly moved in the opposite direction, and the closing price of the last day was almost nothing compared to the previous trading day Variety. The bottom one-day reversal situation is exactly the opposite. (iii) Generally, 15 minutes before the market closes, there is a sudden increase in trading and the price quickly moves in the opposite direction. (iv) The volatility of the two-day reversal of the transaction and price is also huge. The top two-day reversal completely falls back to the previous trading day's gain on the second trading day; while the bottom two-day reversal fully returns to the previous trading day's decline. IF YOU LIKE MY ARTICLES, PLEASE SHOW YOUR LOVE TOWARDS MY ARTICLES BY GIVING LIKES AND COMMENTS. The analysis and discussion provided are for your education and entertainment only. If you have any concerns or questions, DM me.
CME_MINI:ES1!Education
by forextidings
MTL/BTC Channel + local trending. 9 months - 5 pumps + 100-220%MTL / BTC Work in the accumulation channel + from local trend lines. Important reversal areas. For 9 months in the horizontal channel there were 5 pumps + 100% + 150% + 50% + 100% + 220% In real work in the channel by averaging, you can take profits from 60% to 80% of each movement. The coin is not a "promising technological derma" for believing crypto hamsters. Coin "perspective scam" for making real money. I showed the logic of the work on the chart, I also have several ideas for training and articles on this topic, I won’t repeat myself. Volatility is the quality of a trading instrument that, when used skillfully, can inflate your trading deposit to indecent sizes. Also on such instruments, do not forget to withdraw part of the profit from the exchange after each pumping of the price. It is very important. Greed begets poverty. In such highly volatile instruments as in any other cryptocurrencies, sooner or later the time will come for the evaporation of the object of faith of fools (the disappearance of the project). Therefore, it is very important to always cash out part of the profit. Work the rest of the amount by increasing the working volume with a complex percentage. And from here the big next potential profit. Remember, no matter how much virtual money you earn on the exchange, without converting into real money, your profit is always zero A similar coin with such volatility for making real money in a short KIN time. + 111% + 140% + 80% + 160% The work is similar. I showed all movements in advance on this coin, all in related trading ideas, I will not repeat. Kin profit for 3 months of work + 111% + 140% + 80% + 160%. Do not be theorists, but be practitioners. A theory without practice is zero. Only the "weight" of your deposit matters. Everything else is "water." I also emphasize that most of the crowd is waiting - lazy people, they have always been, are and will be outsiders. This is fuel. Do not be him. More information about the trading and not only in my telegram channel SpartaBTC.
Education
by SpartaBTC
4
Identifying support and resistance levels for swing tradingSupport and resistance are essential levels for all traders in swing trading. Before one can start placing orders on the buy/sell side, these key levels will form the battlefield for buying or selling. In the video above, I will show you how to identify the support and resistance levels for swing trading so that you can buy near the support and sell near the resistance to maximize our profit while keeping risk exposure low, to have a better reward to risk ratio.  Depending on your strategy, preference and personality, you always have a choice to participate the swing within the range or in a trend. Swing trader always aim to catch the swing low as early as possible and sell when the swing is ended.  Resistance becomes support level once it was broken up. Always extend the support level to the right and pay attention if the price respect the support level. Do treat support as a zone/area instead of single line/level.
DJ:DJIEducation
by mingjong
12
5-0 pattern. Bearish + 20% and bullish model + 51% Real tradingI must say almost all of this movement I took. Short + 8% (instead of 20%). At long + 55%, entry into the long was lower than shown in this example. I will attach the trading idea for which I worked below. She was published here on January 22. I used other methods of analysis and work, but I used this method that I want to talk about as evidence for my methods. The graph shows a bearish pattern , which immediately turns into a bullish 5-0 pattern, a very rare phenomenon. And that's why I decided to make this idea of ​​training. I want to say that the 5-0 harmonious pattern is very widely used in other markets, rarely in the cryptocurrency, due to the very low professional preparedness of the participants in this market. Trading in this pattern can be either profitable or unprofitable, in the first place it depends not on the method itself, but on the person who uses this method. The 5-0 pattern is effective in areas of potential trend reversal. Just the pair ETH / BTC was in such a zone. The profitability of trade largely depends not on the method of trading, but on the ability to use it. ________________________________________ A bit of history. Harmonic patterns are the development of the idea of ​​ordinary geometric patterns, using Fibonacci levels to more accurately determine pivot points . By the way, I almost never use the Fibonacci levels, as I see without them, what they show. For beginners in trading, it is better to use them. By the way, who did not know initially in the father of harmonious trading Harold Gartley there were no Fibonacci levels. Only more than 80 years after the creation of the theory and the successful application of Larry Pesavento in practice, did Scott Kearney begin to pervert and sculpt exact numbers for each pattern that are far from real application on the market. It’s not customary to talk about this, but their main business is not real trading, but selling books, unlike Harold Gartley , who was a successful trader in the 20-30s during the Great Depression and became a millionaire! This is not an imaginary millionaire trader, a seller of courses and books, but a real trader who made all his fortune on real trading. In mid-1935, Harold published his best work and the first book, which, translated into Russian, was called "Profit in the Stock Market." The initial circulation of this book totaled only 1,000 copies. This book was very popular among traders, despite its very high cost. The book was worth 1,500 dollars, at that time it was possible to buy three new Ford cars for this amount. This is many times higher than $ 1,500 nowadays. One fact is that his books, which were being sold at the height of the Great Depression, let us understand how high authority he enjoyed among the people of the world of finance. The name of the pattern is Gartley Butterfly , which bears the name of its discoverer. Already after the death of Harold, Billy Jones bought from Harold Gartley's wife the patent rights to the book “Profit in the Stock Market”, then continued to print it in large volumes. And a "perverse improvement" in working methods for making money on book sales started. That's why I have such a negative attitude towards such "specialists." You have to be, not seem to be. ________________________________________________ 5-0 pattern. Pattern 5-0 is the youngest harmonious model (it is a variation of it with the Fibonacci grid thanks to traders of books on TA). The model usually represents the first pullback of a significant reversal trend. This is a relatively new model with 4 segments and specific Fibonacci measurements of each point in its structure, which excludes the possibility of a flexible interpretation. Formation of the figure begins with a slight movement of the market, in the direction of a previously existing trend (segment AB), which was preceded by a comparable depth correction (XA). Point B, in this case, should not be higher than the level of 161.8% of point X. This is a fundamental point. If point B "goes" higher, then almost certainly the trader is dealing with short-term correction and the continuation of the existing trend. The segment of the aircraft, in relation to the segment AB, is formed in the range between 161.8% and 224%. The CD segment is a correction within the framework of an emerging trend. The correction depth (according to the classical pattern algorithm) should be 50% of the BC segment. 5-0 pattern template measurements: The segment AB should be from 1,130 - 1,618. before the XA extension. The segment BC should be a continuation of the segment AB from 1.618 to 2.240. Point D should be formed at the level of 0.5 segment BC . The segment AB must be equal to the segment CD, (AB = CD). _______________________________________________ There are bullish and bearish formations of this pattern on the market. The graph shows both variants of the 5-0 pattern. Bullish 5-0 pattern. As you can see, the structure of the price movement at the time of the formation of the 5-0 pattern is generally very similar to the model of the Dragon figure with the development of goals. I made the ideas of training on this model of a figure and will fix it in ideas under the article. Point 0 - the beginning of the downward movement, point X - the first correction upward, point A - the completion of the correction and the beginning of the fall down, point B - the end of the fall and the beginning of the strong upward movement, should be located at a level between 1.13-1.618 from XA, that the point C - the completion of a strong upward movement should be located between 1.618-2.24 from AB, point D is the end of the fall and the beginning of the upward movement, here we are trying to enter the market. The input should be at the level of 50% correction from the BC . Bearish 5-0 pattern. The structure of the bearish model of the 5-0 pattern is remotely similar to the model of an asymmetric head and shoulders or an inverted Dragon figure with a working out target. Point O is the beginning of growth and the beginning of the formation of the model, point X is the beginning of correction down, point A is the beginning of growth and completion of correction, point B is the end of growth, should be located at the Fibonacci projection level between levels 1.13-1.618, point C is the end of a strong fall and the beginning of growth, point D - completion of growth, the place where we should open a deal for sale should be at the level of 50% correction from the BC . Conservative traders are looking for additional confirmation before entering the trade. The 5-0 pattern can be either bullish or bearish . Goals can be set at the discretion of the trader, as the pivot point may be the beginning of a new trend. The common stop loss levels lie beyond the structure level beyond point D or the next important level for the Fibonacci sequence. _______________________________________ Objectives for this pattern. As it is a reversal pattern, which can act as a reversal pattern of the whole trend (the emergence of a new trend). You understand that there can be no clear goals, unlike simple figures. If you really get to the beginning of a new trend, the goals can be huge. It is important here not to exit the market prematurely. So that your profit does not turn into a loss, use the movement of stop-loss as the upward movement develops, but take into account the volatility of the instrument. In this example, on the chart on the ETH / BTC pair, you can clearly see what the goals for this pattern can be. The bearish model made a profit of + 20% Channel support stopped a further drop in prices. The bullish model made a profit of + 51% The first goal is the resistance of the rising channel + 18%, as we see the price there was delayed for some time. From this zone the reverse corrective movement to the support of the channel could take place. But, the price has successfully overcome this zone. In total, the profit is + 51% of the entry point (point D). In two models, the profit in theory was + 20 + 51% = + 70%. But the reality is different, I have a profit of + 8% + 55% = + 60% I rounded the interest for a better understanding, I will say one thing, there was no liquidity at the maximum to reset a significant position, and therefore the profit is much less than the theoretical one on the schedule. ______________________________________ Violations of the pattern 5-0 . More than any other pattern, the 5-0 structure presents a unique opportunity for decision making when the area of ​​opening positions breaks through. In all 5-0 models, the best moment to enter depends on various ratios within the structure. When trying to make a deal while forming an unsuccessful 5-0 pattern, the trader still needs to look at the prevailing trend and at models at smaller time intervals. Of course, the 5-0 pattern is not an ultra-precise model, and it may not work out even in the most correct situations on the market. What to do if the price has broken through all levels and left the channel, in such cases, the authors of harmonious trading offer quality ideas for opening positions. The first target in this case may be the area of ​​correction 0.886 from the entire movement. Therefore, if prices fell outside the channel and broke through the 50% area, then we should expect continued decline. ______________________________________ Advantages and disadvantages of pattern 5.0 Despite the popularity of this pattern, I would like to first consider the disadvantages of the pattern. The main of its shortcomings should be called the poor "recognition" of the figure. After all, not all formations in the real market, exactly correspond to the ideal book example. In this example, I used exactly the ideal option for the ease of presenting information, and a person who is interested in adding this pattern to his arsenal of trading can also look for more complex formations for work. I would advise beginners to look for ideal models for work, as they are more predictable. The developers and "popularizers" of the pattern emphasize its versatility. In their opinion, the pattern works with equal efficiency on any trading instruments and at any time intervals. If in the first part this statement is undeniable, then with regard to timeframes, the use of the pattern raises many questions. On short timeframes, this pattern is not effective due to the high content of "white noise" and which does not allow to clearly identify and build the boundaries of the pattern. Over long periods of time, the created corridor is so wide that, in fact, it can only indicate the direction of the trend (and even then in the long term). Thus, the efficiency of using this figure very much depends on the correctly selected timeframe. The ideal timeframe for work is 4 hours-1 day. Remember the most important thing, this 5-0 pattern is effective in areas of potential trend reversal. _____________________________________ I wrote above that I will attach trading ideas for this pair that I worked on. Which trading ideas made it possible to take profits in shorts + 8% and long + 55%. 1) This one worked in short when the head and shoulders formed. Published November 24th. ETH / BTC Pivot Points . Ascending Triangle - Head and Shoulders Result in short + 8% 2) The trading idea for which he worked in long. Published January 22. ETH / BTC Coin operation. Reversal zones. Double bottom . The result is now + 55%, the entrance was practically at the very minimum price when confirming support. Perhaps we will see a reversal of the main trend by ETH18, if the price closes above the downtrend line (red line). Also, in the idea of training on this graph, you probably all noticed which figure is being formed and how much you can earn from fulfilling its target. Remember, trading is a game of probabilities. Who trades from the situation created in the market - earns. Who trades on the basis of what he wants - receives a loss. The crowd trades out of their desires, not market probabilities. The crowd always loses. From the pixels of thinking of individuals, a way of thinking of the crowd is created. Thanks to the thinking and desires of the crowd, we earn. The more stupid a society is, the higher the percentage of earnings in it is smart. To earn, you need someone to lose money. No other way. Under the article, I have fixed 31 learning ideas. I didn’t even know that I already have so many of them. Knowledge and experience are power!!!
Education
by SpartaBTC
2