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Eurusd-4

DXY - Elliott Wave Breakdown ✅Following on from our last post on DXY, we have moved up a considerable amount. In our last post we identified the higher timeframe impulsive move and waited for a catalyst, NFP, to move the market in our direction. See our previous post below: In Elliott Wave Theory, the impulsive wave can be broken down into the following 5 waves: Wave 1 - is made up of 5 subwaves (impulse) Wave 2 - Is a corrective wave made up of 3 waves (ABC correction) Wave 3 - is another impulse wave made up of 5 subwaves (impulse) Wave 4 - is a corrective wave made up of 3 waves (ABC correction) Wave 5 - Can be either an impulse or a correction - But its made up of 5 waves. In this scenario, the 5th wave is appearing to be an impulsive move. We have a channel which we will be using as a guide to help us identify when the 5th wave will finish. The way to use DXY is by doing the following: Bullish DXY = USD Strength. Bearish DXY = USD weakness 1. Analyse DXY for reversal zones and identify what the next move is 2. In our last post, we identified a reversal zone and we were waiting for NFP to be the catalyst to get the market moving (FEB 4th) 3. When DXY approaches the reversal zone, we go on to USD pairs and analyse them 4. Find a pair where you think USD will bounce/reject (depending on whether you're trading USD/XXX or XXX/USD) e.g. in the VIP, we correlated DXY with EURUSD. We identified that we were bullish DXY = Bearish EURUSD. We had a trade setup ready and we were waiting for confirmation. See below for the the VIP setup we had. Went into 10pip drawdown and hit TP of over 500pips = 1:50 RR. Hope this post helped a little! Goodluck and as always, trade safe!
TVC:DXYEducation
by WicktatorFX
5
Biggest Mover of March! (13.30%)Hey Traders! Just like that, another month has flown by, end of the quarter this time, so it's a little bit more special. What I want to do is run through and have a look at the biggest movers to the upside and to the downside of the month. One of them really stood out across all pairs an I think you guys already know which one I'm going to talk about, the Japanese yen. Looking at our biggest mover of the month, it was AUDJPY and unsurprisingly given how bullish we are looking at the Aussie dollar at the moment and how bearish we were looking at the Japanese yen. As the data unfolded throughout the month, which I talk about momentarily, I am not shocked about this big move but was no expecting a whopping 13.30%. Which was a fantastic move and good to see these types of moves in the Forex market when the volatility comes through. It's bad news obviously for the Japanese yen. Great news for the Aussie dollar. Be interesting to see how it reacts from here. The Japanese yen was very volatile this month. We have a lot of movement due to the unforeseen circumstances around the world. Looking at the Japanese yen fundamentally, it wasn't a great month. Their unemployment rate increase showing that less people had jobs. The producer price index actually increased too much greater than forecasted, which was good news for the Japanese yen, but that didn't last long with the BSI manufacturing index being a massive shock to the system. While the forecast for it was an 8.2 from its previous of 7.9 (forecasting growth). It came in at a whopping -7.6, which was very bad news. Once we adjusted to that bad news, we were met with the trade balance, which was extremely negative as you can see by the chart put below. You can see where the money started to leave the Japanese yen and flood over to the AUD. From there, the shorting of JPY just carried on and on. We had some news come out, like the Tertiary Industry Activity, it was predicted to be negative, it wasn't as negative as forecasted, but the end of the day it is still slower growth which pushed the price even further down. The unemployment rate increased right at the end of the month. As you can see that the price started to push back in and the news might start flipping to show more strength into the Japanese yen compared to what we had. We did see also the pound take a bit of a hit as well as the euro. The euro was a very interesting one as it's reacted with how the whole Russia and Ukraine, scenario is unfolding. Keep an eye on that as we proceed with peace talks, making progress supposedly. We might see a volatility coming through these currencies, but overall I have a bearish sentiment moving into April, not too sure how well that's going to hold up in the long run. And finally, looking at the Swiss franc paired against the US dollar, didn't really make much progress. It was very weak at the start of the month or maybe the US dollar was just wrong. But you can see it moves quite nicely, then we hit the mid point, it's just pulled back into almost where we've opened leaving a very tall top wick on USDCHF. It'll be interesting to see on where we progress from here. Only losing about 0.63% to the US dollar. Thanks so much for tuning in. I hope you enjoyed this. If there is any questions or anything you would like to ask, please leave a comment and I'll get back to you as soon as possible. Cheers guys. Happy trading.
Education
by the5erstrading
ICT Market Maker Sell ModelFirst you must have a clean consolidation which you are anticipating that it will be taken once market come up. Secondly you must have an old low Significant OB which market is chasing it(magnetic) and you know that after market taken out that old low then it will reverse quickly to come up to attack your consolidation. And finally you will investigate if you have any bearish SMT divergence that will give you a confidence that market will chase that old low
Education
by huntingtheflow
4
What is going on in the markets? Aftermaths of Russian invasionRight after Russia declared war and started its military operations in Ukraine, the markets started going crazy. Investors started moving to "safe heaven" trades and sticking with "risk-off" securities. GOLD (XAU/USD) is everyone's favourite to trade for the moment, as the price plummeted straight after the escalation of the war. It has experienced a growth of +4.5% so far, and it has more upside potential. EUR/USD, having a strong negative correlation with GOLD, has endured a 200 pip drop so far, constituting a 1.8% dip. AUD/USD, GBP/USD and other highly correlated USD pairs have deteriorated as well. BITCOIN, often claimed as "digital Gold", is still continuing its downside movements, experiencing a 12.6% drop in 24 hours. Sticking to the safe heavens and riding the trend would be the best possibility right now. Also, remember to stay risk tolerant and cold-blooded, as the markets could get really volatile from time to time, taking into account the current situation.
OANDA:XAUUSDEducation
by Investroy
9
My Trading Strategy in 4 simple steps.Today I will explain step by step the process I use to develop setups. This is how my strategy works. And this can be applied to any asset and using any technical tools. This is as close as I can get to using an empiric approach to define my trading opportunities. Let's start. My trading strategy is composed of 4 steps: 1) Whats the context of the price? Here, I want to understand all the characteristics of the current situation I'm observing. Mainly I will try to define this in the Daily chart. Examples: * Are we making a new ATH? * Are we inside a 300 days correction? * Is the price above or below a Daily trendline? * Are we inside a small correction or a 50%+ decline? 2) Now that I understand my context. Can I look for similar situations in the historical data of this asset? I only work with assets with enough historical data to conduct this type of analysis. If I'm able to find at least 2 previous situations with similar characteristics to what I'm looking for, I proceed with the next step. Here I use the Weekly and logarithmic chart to identify these situations. 3) Do I see a consistent pattern that I can use to trade in those similar situations in the past? Here I will use lower timeframes like the 4HS chart, and I will look into more details in those similar situations. I will try to find something objective, like "The first retest after the breakout of the most external line of the corrections. If I see consistent behavior and a good risk to reward ratio, I will proceed with the final element of my strategy. 4)Define the pattern I'm waiting for and the execution process in advance. At this stage, I want to say, "I'm waiting for this," and this is how I will trade it. This includes: *Entry level *Stop level *Break-even level *Take profit level. *Risk. And this is it. At this stage, my setup can be executed or canceled depending on the price behavior, but in a nutshell, this is the system I have been using for the last 3 years, and I can say that this has, on average, a win rate of 50% and an average risk to reward ratio of 2. I hope this information was useful. Feel free to share your view in the comments or any doubt you may have. Thanks.
BITSTAMP:BTCUSDEducation
by ThinkingAntsOk
101
⭐ ZOOM OUT ⭐ ZOOM OUT 1️⃣ When preparing to take a trade, it is better to take a broad look at the charts. 2️⃣ Taking into account the higher time frame charts, makes you see the bigger picture of the market structure and have a better bias. 3️⃣ Analysis carried out on the daily (1D) and four hour (4H) gives you "stronger entries" and reduces the chances of having false signals. 4️⃣ Of course there are different types of traders, and the SCALPERS would not want to stay long in the markets thus trading the smaller time frame. This can also be done with reference to higher time frame zones by scalping only when the market is around a strong reaction point from the higher time frames. 💥 ZOOM OUT
Education
by Sage_Trader
Most of the time, you will observe a correction.Today we will go through a simple trading lesson, but an effective one. The example I will be using today in terms of timeframes is mainly focused on Swing Traders; however, these principles remain valid for any timeframe because of the fractal characteristic of the market. Also, this will be a bullish example, but the same principles apply to bearish examples. Here, you will have a 4 step process to understand how to improve your executions on any asset. 1)Major Daily Trendline: This is the main structure I have as context. The structure or trend must be evident, such as 300 days bearish trend, where we can draw a descending trendline. It's crucial when looking at these structures to see if they are close to a "major" support zone or if they have already made contact with them. That would be optimal! (Here I would use the weekly timeframe) 2)Breakout: Assuming that the previous conditions on item 1 were fulfilled, now we are in a situation where we can expect a change in direction, and we are interested in developing a setup on the new "expected impulse." Most people fail in developing a good setup because they trade the first breakout of the structure, thinking that the price will skyrocket. As a general rule, consider this: "Never trust the first breakout" This takes us to the next item. 3)Correction: After the breakout of a major structure like the daily trend of the last 300 days or more, we want to see a correction! Here corrections will tend to show some proportion to the previous structure the price is coming from. I draw an ABC pattern on this template, but the main idea is that you want to observe a clear retracement from the breakout where the price tests the broken trendline again or at least makes a clear consolidation of a few days. 4) Setup: Now that we observed all the previous sequences, we can easily develop setups: Pending Stop order for our Entry-level above "B" on the flag pattern. Then, stop loss below "C" or, in other words, below the correction. Finally, take profit on the next MAJOR resistance level. Why do this? Because you are adding filters before trading, and that way you need the price to fulfilled certain conditions which will have three major improvements: Increase the odds of engaging on a high-quality setup and the 2nd one avoid low-quality scenarios or fakeouts. Also, you will avoid overtrading because you need CONTEXT. Thanks for reading, feel free to ask all your questions or more information related to this in the comments ;)
Education
by ThinkingAntsOk
3
Beware False Breakouts! How To Spot Them...Investors should use basic Technical Analysis for powerful decision making. I see it as a challenge to demonstrate how useful knowledge of one simple pattern can be to identify price reversals. Recognizing this pattern and acting on it will save much money and headache! Both traders and investors need to be on guard for false breakout reversals. Seeing this pattern in action can provide an excellent profit target, entry point, or prevent major drawdown! In this video I look at examples in the Silver ETF AMEX:SLV , Spotify stock NYSE:SPOT , and Forex Euro/Dollar pair FX:EURUSD for false breakouts and what follows. I am excited to make this video for my viewers and for Best of Us Investing!
NASDAQ:AAPLEducation
by norok
72
How to Choose Which Pairs to Trade With - The Ultimate Guide!Everyone always asks when they start out "which pairs should I choose to trade with" as there is a long list of currencies. So let's break it down: 1. The currency market is the most liquid market place in the world, but that's not the case with ALL currencies. In fact, the US Dollar is involved in around 90% of all trades that occur in the market and therefore it's what we call the most "liquid". Liquidity refers to how easy it is to exchange assets into cash or vice versa. For example, the US Dollar has upwards of a trillion dollars a day in volume which translates to an unimaginable number of traders ready to buy or sell at any given price at any given time, so it's very easy to fill a trade at the amount and price you want. For a less liquid market, such as an altcoin in cryptocurrencies, the liquidity is a lot thinner which means it's not as easy to fill a trade at any given price. Trades are filled when your broker matches your buy order to a sell order(s) of equal amount. When the market orders to buy exceed the limit orders to sell at any given price, the broker will quote a higher price to attract sellers. If the market is liquid like the dollar, the price will move up a tick or so, but if the price is illiquid like an altcoin, it can run up several pips which is why crypto fluctuates so much. So what does this mean for me when I choose a currency pair? It means that the more exotic you get in your choice such as the USDZAR vs EURUSD, the more volatility, unpredictable and volatile trading conditions you will get. Since we use leverage in the currency markets, we want very liquid pairs and very predictable, stable market conditions which brings our currency pool to EUR, USD, GBP, JPY, AUD and Gold is good too. 2. You should not be trading every single variation of the currency list provided above. There is 0 point having both EURUSD AND GBPUSD or USDJPY, EURJPY AND GBPJPY on your list because of correlation. Correlation means these currencies will move together because in the real world currencies aren't exchanged in pairs, they are singular. When I want to make an investment in the U.S. or if I go an visit New York, I'm not going to the exchange counter asking can I sell my EURUSD currency... no, I sell my Euros and I buy USD in return. So since we know the USD is responsible for 90% of currency trades, if EURUSD is moving up it's a result of the USD being weak unless the Euro has had a signficant news event. In that case, GBPUSD will also move up with it. If you ever find yourself buying EU and selling GU at the same time, you'll lose that more often than not. The exact same happens with the Yen pairs. 3. AUD, CAD are commodity currencies whereby their value comes from the investment purposes their economies are pegged to. AUD is commodity rich in a lot of things so analysing conditions in the commodity markets will give you an idea of it's strength. CAD is based off oil and when oil is up, CAD will be up. So there's no point having Oil and Gold and all these other commodities open along with USDCAD, XAUUSD and XTIUSD. Based on the above, we can wittle about 20 different signifcant currency options down to a handful of choices which are as follows 1. EURUSD or GBPUSD 2. USDJPY or EURJPY or GBPJPY 3. EURAUD or GBPAUD or AUDUSD AND 4. USDCAD or EURCAD or GBPCAD OR 5. XAUUSD and XTIUSD (oil) You shouldn't really have more than 4 to 5 pairs that you know inside out being traded at any given time. If you are looking for more opportunities, branch out into indices such as the S&P or maybe BTC, both are correlated.
Education
by UnknownUnicorn15362357
Cyclic Nature of 23 HR charts. How to forecast volatility.I bet nobody of you looked at 23 hour chart of EUR or GBP. But this is the chart that will reveal some secrets to you as a trader. Take a better look at it. I have no logical explanation to this but its robotic nature is effective in forecasting impulsive price moves. You can use RSI with 23 hours chart. I find it esp useful as it is using closing prices, which are clearly cyclical on 23 hrs chart. FOR EDUCATIONAL PURPOSES ONLY!
Education
by ICFX
Price Action Trading ExplainedHey Guys! Here's a simple explanation of Price Action Trading! In its very essence, Price Action Trading is about letting price tell you where it's headed in the future. No indicators or fundamental analysis. Just price alone will do. But in order to know what price is telling you, you must first learn "how to read price". Think of this as a language. Just like how you're reading this post and understanding my intent through the English language. A price action trader must learn the "Language of Price" before interpreting what price is telling you in terms of where it's headed in the future. Once the language of price is mastered, a price action trader simply reads what price is telling him/her in terms of the future direction of price and makes trading decision accordingly. So, if price is telling you that it will go up in the future, you buy (or abort depending on the situation). Sell, if that's what price is telling you, and most importantly stay out of the market when price is telling you there is no bias in future long or short strength. Take this EUR/USD Short Trade that I'm currently holding positions in: If you follow my weekly forecasts you'll know that I took 2 short trades last year in which I still have 20% in at the current moment. Initially, when I entered these trades last year, the weekly chart's price was telling me, " Yo Ken! There's more short strength than long strength between these 2 major pivots....Just Letting you know!" (shown on the chart.) So in other words, "Price" was telling me that it will reach the Main Target Pivot Low before reaching the Main Stop Loss Pivot High. So, as price pulled back to the Main Stop Loss Level, I listened to "Mr. Price" and took 2 Short Entries with the risk parameters shown on the chart. Then after entry, the lower time frames were consistently telling me, " Hey Ken!There's abundant short strength in this pair! I'm headin' do---wn! "So I took out 80% of the Position at the Main Target. (Just for discipline's sake) and kept 20% in. (Hey!Why not right?) Then from November of 2021 to the current, on each bounce long, price was telling me yet again, " I'm still headed down Ken, Just letting you know.....", so I'm currently still holding 20% of the short position. In this way, by learning the "Language of Price", a price action trader reads what price is telling him/her and makes trading decision accordingly. There is no concept of price being wrong or right. Thus If price does not go in the expected direction. To a price action trader, it is not "the price" that is at fault; nor is it some other Technical or Fundamental element's fault. The blame is always on the misinterpretation of price by the price action trader. For in price action trading, "Price is always Right". Have a great day guys! Ken
Education
by TradingForexPriceAction
3
Market's MoneyHi! Most commonly used and popularized position sizing method is percent equity model i.e. trader should never risk more than certain percent of trading capital on a single trade. Quite often this number is 2%. This can be anything - within trading there is no right or wrong answers. It all depends from different factors: *Goals *Risk tolerance *Account size *Trading experience *Trading style and strategy One great position sizing technique is 'Market's Money'. Actually it is a way how trader can think (mindset) about his trading capital. Concept is simple: there is my money and there is market's money. My money is my starting capital and all earned profits are market's money. Market's money will become mine only if I convert it into my money. Until it has not been converted into my money, then I can risk more with it because it's not my money, it's market's money. As I mentioned before, it is mindset. Some traders are able to think about trading capital that way, others are not. And that's fine, trader's are different. For me this is a great position sizing technique. Trader can risk less with his "own" capital and more with "market's" capital. Generally speaking we can group position sizing strategies into 2 groups: aggressive and defensive. Market's money goes into aggressive group. It can be used when trader's one goal is to make high returns. I don't want to say exceptional because actually trader can also be conservative using market's money method. There are numerous ways (thousands I guess) how to use market's money. Eventually it all comes down to how trader determines when market's money is converted into his. Here are few examples: *Time (days, weeks, months, years) *Cash earned *Percentage gain *Trades (1, 2, 5, 10, 30 etc.) *Tax purposes *Mathematical formula *Girlfriend's birthday 😀 Usually examples with biggest compounding effect come from: 1) Systems that have very high winning percentage 2) Infrequent conversions from market's money to trader's money Here are few examples how to use market's money: Let's say that trader has starting capital X $. Risk per trade is 2% of that equity. After turning profitable he/she is willing to increase risk. In addition to initial risk (2%), trader is willing to add 5% from earned profit into every new trade. Trading period is 3 months. After that trader converts profits (market's money) into his. Then everything starts over. Chart 2 This example is suitable for day traders. Those traders know very well their system and that system wins on average 3 trades in a row until losing trade occurs. If this system is generating thousands of signals per year then market's money compounding effect would be exceptional. In case of losing streak trader must be willing to live through large drawdowns. When trader uses different system (let's say some trend-following method with low winning percentage) then this position sizing method would not work so well. Key is to know characteristics of your trading system/style and then figure out what kind of position sizing would be best fit. In real life it is very hard to find these kind of systems that have high certainty about when losing trade happens. Mostly trade distribution is more random. Therefore most traders should not use this example with real money. I just wanted to show some different variations about how it is possible to use market's money. Conclusion: If trader's trading system or style (here I mean also discretionary traders) is profitable, then using some creative position sizing methods allow to achieve better results without changing the system. Some traders are constantly trying to improve their systems and make them perfect. Instead that, maybe it would be better to spend some time in position sizing area. Simple trading system/style + well thought position sizing method = Good System! Lastly, it all depends what you find logical and what suits you. Trading with percent equity model is totally fine. Adding market's money to that model can give higher compounding ability to profitable traders. Thank you and have a nice day. Cheers
NASDAQ:AAPLEducation
by Laurentsius
4
How can I use this trading template? Today I will share a template that may be really helpful to understand some key concepts: First concept: Only look for setups IF the price has reached a major level. In this example, we can see a bearish movement that has reached a weekly level. Why is this relevant? Because if we are working with relevant levels that had worked in the past, we increase the chances of being right regarding an expected movement. Alright, does this mean that I should buy there? ABSOLUTELY NOT; let's go to the second concept Second concept: Once the price has reached a major level, wait for confirmations. Waiting for confirmations means that we have other levels to pay attention to that may provide us solid insights regarding what the price may do next; in this case, we have a descending trendline. A bearish trendline tells us this: Below the line, assume the bearish trend continues; above the line, assume that a possible change in direction may happen. Cool, now is time to buy, right? ABSOLUTELY NOT; let's go to the third concept Third concept: After the breakout of a major structure, WAIT for a correction Most of the time, we will tend to observe a correction after a big structure breakout. That type of behavior can be understood on this template after the breakout. There is a correction happening that we will generally be able to define inner waves; in this case, we have an ABC pattern. Corrections are our final confirmation before engaging with a setup. The position where we tend to observe corrections are in the following places: On the edge of the broken structure / Above the broken structure / On the first minor level after the breakout. Great information! Can I trade now? Yes, now we can define our setup, which takes us to the next concept. Fourth concept: After waiting for several confirmations, we can think about developing setups on the breakout of the corrective pattern (entering above B tends to be an excellent entry-level). Stop loss should always go BELOW C or, in other words, below the last local support zone. Take profit levels can be defined using the next relevant level we may have; these are not the minor levels; I'm speaking the next resistance zone with the same hierarchy as the support we started thinking on bullish opportunities. Fifth concept: This is a template mainly for Swing traders; that's why I wanted to show what to expect in the process between our execution and the take profit level. We may see one or multiple corrections on the way, most of them happening on minor levels. Of course, real trading is much more complex than this, but templates are a good way of understanding concepts and seeing how we can apply this to real market conditions. Another important item I want to highlight is that this type of system tends to have a win rate of around 50%. If we only engage with setups that provide a risk to reward ratio higher or equal than 2, then that's all you need to become profitable. Thanks for reading; if you have any doubts, drop them in the comments, and feel free to share your opinion on this.
OANDA:XAUUSDEducation
by ThinkingAntsOk
7
Trading Roadmap for 2022Happy New Year to everybody. Here is my roadmap for financial year 2022. It is simplified version but generally it says everything about what to do. Plan: Everything starts from the plan. It is very hard to navigate financial markets without it. As markets move constantly it's very easy to get lost or become controlled by emotions (fear and greed for example). The trade plan is a tool that helps us. It takes some market knowledge and experience to develop a good plan and then discipline is needed to follow it. Also sometimes there is a need to modify the plan when conditions change drastically. Wait: Patience is essential part of good trading/investing. If you miss some opportunities then calmly wait for another ones - they are always coming. Execute: Do what you have previously planned. It is a trade management - also important part of trading. You can be right with timing but without trade management you could easily see all your 'paper profits' disappear. On the other hand you can be dead wrong with timing but with proper management it is possible to squeeze more out of that trade than from previously mentioned example. Accept Results : Probably hardest part to deal with when things are not going well. People just don't like to lose money but this is part of the game. I always try to think about it as cost of doing business or the amount of money I need to spend to make myself available for the winning trades. More info about how to deal with the losses can be found from my earlier posts: Trading in the Zone Trading in the Zone 2 Accepting results happily takes some practicing :) Learn: Making screenshots from your past trades is best option how to learn. It is also essential part of 'Journaling'. I like to save all my trades with real-time notes and comments - and then later analyse them. Repeat: Becoming good at something in this life requires work and practice. Trading is no different. So process starts all over again - enjoy. I wish you all the best for upcoming year. Cheers :)
Education
by Laurentsius
8
Why Are Psychological Levels So Vital In Trading ?WHAT ARE PSYCHOLOGICAL LEVELS AND HOW DO THEY WORK? Psychological levels are market price levels which are often key levels in forex denoted by round numbers. These round numbers frequently act as levels of support and/or resistance. Psychological support and resistance consistently work because of fundamental human disposition. Human beings value simplicity; from a trading perspective this means valuing whole numbers. Traders often use these numbers as entry, exit or stop levels. These stops and limits can alter order flow and price changes. IDENTIFYING PSYCHOLOGICAL LEVELS ON FOREX CHARTS Traders will often call these whole number intervals ‘double-zeros,’ as these prices are at even numbers such as 1.3000 in the EURUSD. See the chart below and observe how the price acts around these levels in the case of EURUSD M charts. These levels works best on Higher timeframes especially on the Monthly charts. The link below reveals one of the example on how a trader can incorporate this particular element of trading in their analysis and setups Cheers, I hope you found this educational material helpful
Education
by FX618Analysis
These few chart patterns will improve your trading!Hello everyone, Let's look at few of my favorite chart patterns that I use from day to day in my trading and analyses. These patterns appears in almost every asset, instrument and currency pairs in the financial market and stock market. Forex chart patterns are on-chart price action patterns that have a higher than average probability of follow-through in a particular direction. They have offer significant clues to price action traders that use technical chart analysis in their forex trading decision process. Each chart pattern has the potential to push the price toward a new move. Forex traders tend to identify chart patterns in order to take advantage of upcoming price swings. Forex trading patterns are divided in groups based on the potential price direction of the pattern. There are three main types of chart patterns classified in Forex technical charting: 🔹 Continuation Chart Patterns 🔹 Reversal Chart Patterns 🔹 Neutral Chart Patterns 1. Bullish Flag In the context of technical analysis, a flag is a price pattern that, in a shorter time frame, moves counter to the prevailing price trend observed in a longer time frame on a price chart. It is named because of the way it reminds the viewer of a flag on a flagpole. The flag pattern is used to identify the possible continuation of a previous trend from a point at which price has drifted against that same trend. Should the trend resume, the price increase could be rapid, making the timing of a trade advantageous by noticing the flag pattern. In this scenario a bullish flag can be a sign that the previous bullish move that occurred prior to this pattern is likely to continue in the same direction. Opposite can be said with the bearish flag. 2. Double bottom The double bottom is a reversal pattern that occurs after an extended move down. The pattern signals that the market is unable to break through a key support level, and thus is likely to move higher. This pattern consist of 🔹First bottom 🔹Second bottom 🔹Neckline Neckline represents a resistance level that forms after the first bottom. A daily close above the neckline confirms the double bottom pattern. A total break through the neckline may confirm a violation of this pattern, long positions can opened once price has closed above the neckline at times a successful retest of price to the neckline can confirm a strong reversal. The opposite of this pattern is the Double Top which is a sign of reversal in bullish market, signaling a strong move to the downside. 3. Triple Bottom A triple bottom is a visual pattern that shows the buyers (bulls) taking control of the price action from the sellers (bears) and that price is about to change direction to the upside. A triple bottom is generally seen as three roughly equal lows bouncing off support followed by the price action breaching resistance. The formation of triple bottom is seen as an opportunity to enter a bullish position. The triple bottom consist of: 🔹First bottom 🔹Second bottom 🔹Third bottom 🔹Neckline The opposite of the triple bottom is a triple top which can signal a move to the downside. 4. Head and Shoulders A head and shoulders pattern is a chart formation that appears as a baseline with three peaks: The outside two are close in height and the middle is highest. In technical analysis, a head and shoulders pattern describes a specific chart formation that predicts a bullish-to-bearish trend reversal, while an inverse head and shoulders indicates the reverse. The head and shoulders pattern is believed to be one of the most reliable trend reversal patterns, but does have its limitations. 5. Rectangle A rectangle occurs when the price is moving between horizontal support and resistance levels. The pattern indicates there is no trend, as the price moves up and down between support and resistance. The rectangle ends when there is a breakout, and the price moves out of the rectangle. Some traders like to trade the rectangles, buying near the bottom and selling or shorting near the top, while others prefer to wait for breakouts. 6. Symmetrical Triangle The symmetrical triangle pattern is a continuation chart pattern like Ascending and Descending Triangle patterns. This pattern is characterized by two converging trend lines that connect a series of troughs and peaks. The trend lines should be converging to make an equal slope. This pattern indicates a phase of consolidation before the prices breakout. 7. Ascending Triangle The ascending triangle is a bullish formation that usually forms during an uptrend as a continuation pattern. There are instances when ascending triangles form as reversal patterns at the end of a downtrend, but they are typically continuation patterns. Regardless of where they form, ascending triangles are bullish patterns that indicate accumulation. Because of its shape, the pattern can also be referred to as a right-angle triangle. Two or more equal highs form a horizontal line at the top. Two or more rising troughs form an ascending trend line that converges on the horizontal line as it rises. If both lines were extended right, the ascending trend line could act as the hypotenuse of a right triangle. If a perpendicular line were drawn extending down from the left end of the horizontal line, a right triangle would form. 8. Cup and Handle The Cup and Handle is a bullish continuation pattern that marks a consolidation period followed by a breakout. There are two parts to the pattern: the cup and the handle. The cup forms after an advance and looks like a bowl or rounding bottom. As the cup is completed, a trading range develops on the right-hand side and the handle is formed. A subsequent breakout from the handle's trading range signals a continuation of the prior advance. The opposite of this is the Inverse Cup and Handle that appears in the bearish market and that act as a continuation pattern and sponsor move to the downside after the breakout. Friends if you enjoy this educational contents please do not forget to show your support with likes. Do follow me for more future contents like this.
FX:NAS100Education
by Forexintelligence_NA
Strike ZoneHi! I wanted to share this post about similarities between baseball and investing/trading. Gentleman on the left side of the picture is Ted Williams, the legendary Red Sox left fielder. He batted .406 back in 1941 (since then he has been last player to bat above .400). I am from Europe and baseball is not popular here but it is a good sport to compare with investing because it is very statistically based game (among other similar traits). Gentleman on the right side of the picture is Warren Buffett, legendary investor. He has quite good 'batting' average over his investment career and it's monetary result can be counted in tens of billions of dollars. In my opinion these pictures above describe pretty well how investor/trader should approach markets: 1) It is very important to have patience and discipline. These traits are needed to separate real opportunities from fake ones. 2) Investor/trader should know what is his 'Strike Zone'. Nowadays there are so many different asset classes and instruments to trade. It is quite hard to trade them all efficiently. Finding out what suits you takes time and practice (assets, timeframes, trading styles etc.) For example I have found out that I like to trade stock market openings with 1-minute chart, but with Crypto markets my preferred timeframe is daily/weekly. Few times in my trading career I have sold out my portfolio (here I am talking about long-term holdings) and then started to rebuild it again. At first it was quite stressful because I felt that I was always rushing and did not had enough patience. To help myself I made a little modification out of that picture presented before (see below): Financial markets are moving mechanisms that constantly change. Market throws every day different situations and emotions in front of you. Patience and discipline is needed to filter out 'false promises'. Knowing your 'Strike Zone' increases your changes to 'swing' with higher percentage. Yes - higher percentage - with trading losses are part of the business (unless you are some High Frequency Trading Firm that has maybe 1 losing day in several years). Keep in mind: Ted Williams achieved batting over .400 - it means that for every 10 bats, he missed 6 times. He was still a great player. This picture helped me to visualize markets and develop patience and discipline. Probably your 'Strike Zone' is different than mine as all traders are different in some way. And of course 'Strike Zone' can change in time. As markets evolve in time, we as traders and humans evolve as well :) Now that year starts to end it is good time to look back and analyse, how was your 'hitting'? But more importantly - how would you like to 'hit' next year :) Feel free to get discussion going in comments about your thoughts. Thank you. Merry Xmas and & Happy New Year :)
Education
by Laurentsius
130