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The Trading Matrix: 14 Vital Lessons DecodedThe Matrix is a movie where no matter what age you watch it, you’ll gain a different perspective from it. And there is a wealth of knowledge and ideas that you can unlock when you dig deep into the movie. A world where the line between reality and illusion blurs, much like the iconic film. The Matrix, with its deep philosophical underpinnings and action-packed storyline. It isn’t isn’t just a cult classic; it’s a treasure trove of lessons for traders. Let’s decode a few trading lessons you can learn from The Matrix. Building Confidence: The Neo Path Remember Neo’s metamorphosis? From Thomas Anderson, a man riddled with doubt, insecurity and worry. To Neo, the confident savior of humanity. This journey is similar to one that a trader takes. You begin with uncertainty, doubt and worry. You then develop greed and ego. The market disciplines and humbles you again and again and again. But then you develop the edge. You adapt to the trading world with gains, losses, drawdowns and different streaks. And then you develop self confidence and resilience as a trader. Like Neo, you might stumble, but remember, every setback is a setup for a comeback. Confirmation Bias: Dodging the Bullet Much like Neo’s iconic bullet-dodging scene, traders must learn to dodge the deadly bullet of confirmation bias. Neo created some form of movements and hand gestures in order to stop the bullets. But what he truly did was create confirmation bias that he was beyond the physics and laws of the universe. And this system is how he was able to go beyond the normal. Create or adopt a trading system that with Confirmation bias, you can identify high probability trades. And even though, you’re using some pseudo system that no one knows about. You’re simply turning chaos into financial order, to have a mechanical process involved – to grow a consistent account. Only by actively seeking diverse viewpoints can you dodge the bias bullet and make decisions that are truly informed. Take the Red Pill: Embrace Reality Taking the red pill is about confronting the brutal truths of the market. The trading world is not a bed of roses; it’s volatile, unpredictable, and sometimes harsh. Those traders who take the blue pill – Only look to win. Only look to build their portfolio with an insane win rate. Only look to go all in on certain positions. When you take the red pill, you take on the realities of trading. You acknowledge the risks. You prepare for the drawdowns. You know you’re going to take inevitable losses. You understand that your past trading does not indicate future results. Those oblivious traders – get destroyed. Like Neo, when you choose the red pill, you choose to see the market for what it truly is, warts and all. There Is No Spoon: The Power of Perspective The “There is no spoon” scene teaches us the power of perspective. In trading, the market isn’t your enemy; it’s your perception that needs adjusting. Bend your mind, not the spoon. Adopt a system which has a flexible mindset. Be ready to pivot your strategies in response to market dynamics. Success comes not from forcing the market to your will, but from adapting your will to the market. Understand the Code – Understand the Matrix Trading involves deciphering patterns, much like understanding the Matrix’s code. The market moves up, down and sideways. Given. But with Price, Volume and probabilities – there is a proliferation of world of opportunities with each market. Develop the ability to read charts, trends, and indicators. Recognize that behind every market movement, there’s a code to be cracked. Agent Smith and Market Manipulators Just as Agent Smith represents a threat within the Matrix, market manipulators pose real dangers. Stay away from markets with: Too much volatility Too many gaps Unusual trading activity Stay vigilant, and don’t be swayed by pump-and-dump schemes or misinformation. They will disrupt your trading journey. Training Simulation: Practice Makes Perfect Remember the scene where Neo was practice fighting in simulations with Trinity and Morpheus? He was testing, improving, adapting and learning. You should do the same before you risk your hard earned money. Test, Test, Test, Forward Test and Real Test. Use demo accounts and simulations to hone your skills. Make mistakes where it’s safe to do so, and learn from them without risking your capital. Morpheus’s Faith: Belief in Yourself Morpheus believed in Neo before he believed in himself. Cultivate self-belief. Trust in your analysis, your strategy, and your decisions. Without belief, fear and doubt will cloud your judgment. The Architect’s Plan: Strategy is Key Understand the market’s architecture. Develop a trading plan and stick to it. Adjust as necessary, but always with the structure of your overall strategy in mind. Free Your Mind: Emotional Control Neo’s journey was as much about freeing his mind as it was about saving the world. In trading, emotional control is paramount. You need to learn to let go of Ego, Fear and Greed. These are your greatest enemies. You can do this by: Having a strong back tested track record to prepare for what is to come. Risk even less until you don’t feel the losses. Real trade with the smallest positions to get an idea on how the markets work and will operate when you incorporate costs. Train yourself to remain calm and objective, regardless of the market’s ups and downs. FINAL WORDS: The Path to Financial Awakening Trading, is much like deciphering the Matrix. It is an ongoing journey fraught with challenges, revelations, and the need for constant adaptation. The key points to remember with the Trading Matrix are: Building Confidence: The Neo Path Develop self-belief through education and resilience. Confirmation Bias: Dodging the Bullet Seek diverse viewpoints to make informed decisions. Take the Red Pill: Embrace Reality Embrace the reality of the markets with all its risks. There Is No Spoon: The Power of Perspective Adjust your perspective and adapt to market dynamics. Understand the Code – Understand the Matrix Understand the code behind market movements. Agent Smith and Market Manipulators Stay vigilant against market manipulation. Training Simulation: Practice Makes Perfect Use simulations to hone your trading skills. Morpheus’s Faith: Belief in Yourself Cultivate self-belief and trust in your decisions. The Architect’s Plan: Strategy is Key Develop and stick to a well-thought-out trading plan. Free Your Mind: Emotional Control Master your emotions to remain calm and objective.
TVC:SA40Education
by Timonrosso
How will Stocks React to Inflation?The stock market's reaction to an inflation trend always involves a delay. Based on studies of the inflation trend, this delay is approximately 6 months. How about the inflation data month by month? Micro E-Mini Nasdaq Ticker: MNQ Minimum fluctuation: 0.25 index points = $0.50 Disclaimer: • What presented here is not a recommendation, please consult your licensed broker. • Our mission is to create lateral thinking skills for every investor and trader, knowing when to take a calculated risk with market uncertainty and a bolder risk when opportunity arises. CME Real-time Market Data help identify trading set-ups in real-time and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com
CME_MINI:NQ1!Education
by konhow
2
Odds and Psychology.Based on "Think fast and slow", people have two system thinking. System-1 is autonomous, always working in background (ie unconsciousness), lazy, intuitive, fast, has stereotypes. System-2 is rational, hard problem solving, takes effort and energy, cuts trough the BS, etc (ie consciousness). Based on another book called "superforcasters" and some dude I forgot his name, best approach for odds is to have simple system; where 100% certain. 93% almost certain. 75% probable. 50% about even (or maybe). 25% probably not. 7% almost certainly not. 0% impossible. All forecast are subjective guesses. The catch; If you think something is 100% - you would go allin with max lever. (If you dont) your beliefs or opinion go against your actions. If you dont believe it's wise to go allin - then odds are not actually 100%. If you are stressed about 93% spot, then maybe it might not be 93% after all. (1:14). In key SPX areas, based on business cycle and TNX, logic says one odds (or System-2) and your intuition (or feel) says differently. You are either too bearish or too bullish. This is a simple representation of concept. Another key concept is that TIME <----> PROBABILITY are at opposite sides of coin. The closer or far away in time something - more or less risk, ie higher or lower probability.
SP:SPXEducation
by citsvar
How to determine how far a correction will goTo assess the extent of a market correction, I examine the price action around Fibonacci retracement levels and use the RSI for additional confirmation. On the Comex Copper futures chart, the market has executed a 50% retracement and bounced significantly from that level. The RSI has corrected its overbought condition and is attempting to stabilize around the 40 level. I am optimistic about a potential recovery from here but will need further confirmation from either the RSI or the price action. The RSI could still fall and test the 30 level. At this stage, we cannot rule out a 61.8% retracement, though a 78.6% retracement seems unlikely given the current RSI position. Disclaimer: The information posted on Trading View is for informative purposes and is not intended to constitute advice in any form, including but not limited to investment, accounting, tax, legal or regulatory advice. The information therefore has no regard to the specific investment objectives, financial situation or particular needs of any specific recipient. Opinions expressed are our current opinions as of the date appearing on Trading View only. All illustrations, forecasts or hypothetical data are for illustrative purposes only. The Society of Technical Analysts Ltd does not make representation that the information provided is appropriate for use in all jurisdictions or by all Investors or other potential Investors. Parties are therefore responsible for compliance with applicable local laws and regulations. The Society of Technical Analysts will not be held liable for any loss or damage resulting directly or indirectly from the use of any information on this site.
COMEX:HG1!Education
by The_STA
1
Options Blueprint Series: Cost Efficient Skip Strike ButterflyUnderstanding Skip Strike Butterfly The Skip Strike Butterfly strategy is a unique and cost-effective options trading strategy that builds upon the traditional butterfly spread. This strategy involves buying and selling options at different strike prices to create a position with limited risk and potential for profit. Unlike the traditional butterfly spread, the Skip Strike Butterfly "skips" a strike price, which reduces the overall cost of the trade while maintaining a similar payoff profile. Benefits: Cost Efficiency: Lower upfront cost compared to traditional butterfly spreads. Limited Risk: The maximum risk is limited to the net premium paid for the strategy. Profit Potential: Potential for significant returns if the underlying asset moves within the expected range. Understanding the mechanics of the Skip Strike Butterfly strategy can provide traders with a versatile tool for navigating market conditions when trading Corn Futures. This strategy allows traders to participate in market movements with a well-defined risk and reward profile, making it an attractive option for those looking to optimize their trading costs. Strategy Setup Setting up the Skip Strike Butterfly strategy for Corn Futures involves selecting the appropriate strike prices and expiration dates. Here, we detail the steps to configure this strategy effectively. Steps to Set Up the Skip Strike Butterfly: 1. Select the Expiration Date: Choose an expiration date that aligns with your market outlook and trading plan. Ensure you select an expiration that provides enough time for the expected price movement to occur. 2. Determine the Strike Prices: Identify the current price of Corn Futures. Typically, use calls for bullish setups and puts for bearish setups. Buy one in-the-money (ITM) option. Sell two at-the-money (OTM) options using a strike located near to where the trade target price is. Skip one or multiple strikes and buy one further out-of-the-money (OTM) option. 3. Calculate the Cost: Calculate the net premium paid for the strategy by considering the premiums of each option involved. The net cost is generally lower due to the skipped strike price. 4. Establish the Payoff Structure: The maximum profit is realized if the price of Corn Futures closes at the middle strike at expiration. The maximum loss is limited to the net premium paid for the strategy. Application to Corn Futures Analyzing the current market conditions for Corn Futures is crucial before implementing the Skip Strike Butterfly strategy. Let's examine the market and set up a trade based on recent data and trends. Market Analysis: Current Price: Corn Futures are trading at 456'6 per contract. Market Trend: The market has shown moderate volatility with a tendency to hover around the 450 level. Technicals: Recently, buy UnFilled Orders (UFOs) have formed around the 450 level, indicating strong buying interest and potential support at this price. On the other hand, sell UFOs are positioned much higher, around the 490 level, suggesting limited selling pressure in the immediate range and opening the door for a directional move with a potentially strong reward-to-risk ratio. Setting Up the Trade: Based on our analysis, we will implement the Skip Strike Butterfly strategy as follows: Current Price of Corn Futures: 456'6 Expiration Date: 74 days from today. Strike Prices and Premiums: Buy 1 ITM Call: Strike Price 450, Premium 27.25 Sell 2 ATM Calls: Strike Price 480, Premium 16 each Buy 1 OTM Call: Strike Price 540, Premium 6 Net Premium Paid: 27.25 (buy) - 32 (sell) + 6 (buy) = 1.25 points = $62.5 (Point Value is $50/point) Source: Options chain available at www.tradingview.com Trade Execution: Entry Price: The trade is entered at 1.25 points, making it highly cost-efficient. Target Price: The optimal scenario is for Corn Futures to close at 480 at expiration, where the maximum profit is realized. Break-Even Points: Calculate the break-even points to ensure clarity on potential losses or gains. For this setup, the break-even points are 451.25 and 508.75. Risk: In the worst-case scenario, this trade could incur a loss of 31.25 points if Corn Futures surpasses the upper break-even point. Conversely, a minor loss of 1.25 points would occur if Corn Futures falls below the lower break-even point. Source: Risk profile graph available at www.tradingview.com Risk Management Risk management is a critical aspect of any trading strategy, and it is especially important when trading options like the Skip Strike Butterfly. Effective risk management helps protect against unexpected market movements and ensures that losses are minimized while maximizing potential gains. Importance of Risk Management: Limit Losses: By setting clear stop-loss levels, traders can limit the amount of capital at risk and prevent large losses. Preserve Capital: Protecting trading capital is essential for long-term success. Effective risk management allows traders to stay in the game even after a series of losing trades. Emotional Control: Having a risk management plan helps traders stick to their strategy and avoid emotional decisions driven by market volatility. Maximize Gains: Proper risk management enables traders to capitalize on profitable opportunities while keeping losses in check. Techniques for Managing Risk with Skip Strike Butterfly: 1. Stop-Loss Orders: Set stop-loss orders at predetermined price levels to automatically exit the trade if the market moves against you. 2. Position Sizing: Only allocate a small percentage of your trading capital to any single trade. This helps to mitigate the impact of any one trade on your overall portfolio. 3. Diversification: Diversify your trading strategies and instruments to spread risk across different markets and reduce the impact of adverse movements in any one asset. 4. Hedging: Use other options strategies to hedge your positions. For example, buying protective puts can limit downside risk if the market moves significantly against your position. 5. Regular Monitoring: Continuously monitor the market and your positions. Be prepared to adjust your strategy or exit the trade if market conditions change. Conclusion The Skip Strike Butterfly strategy offers a cost-efficient and flexible approach for trading Corn Futures. By strategically setting up options at different strike prices while skipping an intermediate strike, traders can reduce the cost of the trade while maintaining a similar payoff structure to a traditional butterfly spread. This strategy is particularly useful in markets exhibiting limited price movements, making it ideal for the current conditions in Corn Futures. Key Takeaways: Cost Efficiency: The Skip Strike Butterfly reduces the upfront cost of entering a trade, providing a significant advantage over traditional butterfly spreads. Limited Risk: With a well-defined risk profile, this strategy ensures that losses are capped at the net premium paid. Profit Potential: Although the maximum profit is achieved if the underlying asset closes at the middle strike price, the strategy still offers substantial profit opportunities within a specific price range. Risk Management: Implementing robust risk management techniques is essential for success. Utilizing stop-loss orders, managing position sizes, diversifying strategies, and regular market monitoring can help protect trading capital and maximize gains. When trading options and employing strategies like the Skip Strike Butterfly, it is crucial to stay disciplined and adhere to your trading plan. Always ensure that your risk management measures are in place to navigate market uncertainties effectively. When charting futures, the data provided could be delayed. Traders working with the ticker symbols discussed in this idea may prefer to use CME Group real-time data plan on TradingView: www.tradingview.com This consideration is particularly important for shorter-term traders, whereas it may be less critical for those focused on longer-term trading strategies. General Disclaimer: The trade ideas presented herein are solely for illustrative purposes forming a part of a case study intended to demonstrate key principles in risk management within the context of the specific market scenarios discussed. These ideas are not to be interpreted as investment recommendations or financial advice. They do not endorse or promote any specific trading strategies, financial products, or services. The information provided is based on data believed to be reliable; however, its accuracy or completeness cannot be guaranteed. Trading in financial markets involves risks, including the potential loss of principal. Each individual should conduct their own research and consult with professional financial advisors before making any investment decisions. The author or publisher of this content bears no responsibility for any actions taken based on the information provided or for any resultant financial or other losses.
CBOT:ZC2!Education
by traddictiv
Past Indications of uptrend health in the SPXEven when all empires fall, It's important to remember that as long as humanity in general continues to discover, explore, solve and invent, the better off we all are. That's why the price of indices always tend to go up. Even when they become stagnant, they eventually keep on increasing. The only thing that can revert this is a total collapse of society, which is unlikely in the present moment. Nevertheless, it's also important to observe the health of a trend. When price increases violently, then a correction is likely to occur. These corrections can be severe or simple technical resets. Technical resets are good for everyone as it allows new buyers to enter the market as well as provide good buying opportunities. However, circumstances can lead the price to not have reset but instead have a correction or a crash. The difference between the two is that a correction is slow to reach the bottom, while a crash is a sudden move downward. As one can see here leading up to the 2000 dot com crisis the uptrend was quite healthy, and it did a slight reset before going into euphoria, where price goes into the 3rd standard deviation range while pushing price higher and higher, before price lost momentum and eventually had a correction as the uptrend was way too aggressive. Meanwhile, leading up to 2008 crash there is a very aggressive uptrend, completely breaking into higher level deviations without going through the stages of a healthy uptrend. Causing the price to crash once the market realized that the system was still heavily corrupted by greed. However, since things throughout time do improve, this allowed for another aggressive uptrend to form which instead of running into a crash it went into a technical reset which latter became the longest bull market in USA history.
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SP:SPXEducation
by DarkMessiah777
31
Trend Reversals and the Sushi Roll Reversal PatternTrend Reversals and the Sushi Roll Reversal Pattern Understanding trend reversals is essential for optimising trading and managing risks. This article delves into the concept of trend reversals, with a focus on the Sushi Roll reversal pattern—a sophisticated tool that helps traders anticipate significant market shifts—exploring its formation, context, and application. Understanding Trend Reversals As you know, a trend reversal indicates a change in the direction of a price movement, transitioning from an upward to a downward trajectory or vice versa. Recognising these reversals is crucial as they can signal opportunities to enter a trade or take profits. A reversal must be distinguished from minor retracements or "pullbacks," which are short-term movements against a prevailing trend that do not signify a long-term change. Traders analyse reversals through various technical indicators and chart patterns, which provide visual cues and statistical evidence of potential shifts in market momentum. Several well-known patterns signal trend reversals: - Head and Shoulders: This pattern appears at the peak of an upward trend and features three peaks, with the middle one being the highest. Its completion, marked by a price fall below the support level—the "neckline"—confirms a trend shift to the downside. - Double Tops and Bottoms: These patterns occur at the end of a trend and resemble the letter "W" (Double Bottom) or "M" (Double Top). A double top signals a move from an uptrend to a downtrend after failing twice to break through a resistance level, while a double bottom suggests a shift from a downtrend to an uptrend after failing to break a support level twice. Identifying and confirming these patterns with other analysis tools allows traders to make informed decisions about entering or exiting positions, aligning their strategies with the new trend direction. Thus, understanding and recognising trend reversals is an essential skill in a trader's toolkit. The Sushi Roll Reversal Pattern: An Overview The Sushi Roll reversal pattern is a lesser-known but valuable technical analysis tool for spotting potential market reversals. It can effectively be viewed as an expanded version of the engulfing candle setup. Originating from trader Mark Fisher's work, this trend reversal pattern forms over a span of ten trading bars and is utilised to anticipate shifts from an existing trend. The structure of the Sushi Roll pattern is distinctive from other stock reversal patterns (however, note that it applies to all types of assets, including forex, commodities, and crypto*). It consists of two consecutive five-bar segments. The pattern is identified when the range of the first five candlesticks (high to low) is fully contained within the range of the subsequent five candlesticks. This formation suggests a consolidation and potential volatility increase, signalling traders to prepare for a possible trend reversal. On higher timeframes, this pattern could manifest as just two or three candles, with the latter completely overshadowing the earlier price action, resulting in an engulfing candle pattern. Criteria for the Sushi Roll Reversal Pattern - Ten-Bar Formation: The pattern unfolds over ten bars on the chart. - Range Overlap: The high and low prices of the first five bars must be narrower than those of the next five bars. - Contextual Positioning: It typically appears at the end of a prevailing trend, either an uptrend or a downtrend. Analysing the Sushi Roll Reversal Pattern Traders observe this pattern as a precursor to strategic decisions. When it appears during an uptrend, it might indicate a forthcoming downtrend, and vice versa. Market Conditions and Reliability The Sushi Roll pattern can emerge under various market conditions, but it is typically more prevalent and reliable at the peak or trough of significant trends. The requirement that the highs and lows of the first range must be surpassed indicates an initial attempt to extend the existing trend, which fails as the price reverses and breaks through the opposite end of the range. This action is indicative of a liquidity grab—where market players trigger stop losses or entice latecomers before sharply reversing direction. Flexibility in Bar Count While the classic Sushi Roll pattern unfolds over ten bars, the exact number isn't rigid. Variations might occur over eight or twelve bars, with the key being the relative engulfment of one segment by another, not the specific count. Application in Trading Strategies The Sushi Roll reversal pattern, while powerful, is optimally used as a component of a broader trading strategy. The key to utilising the Sushi Roll effectively lies in its confirmation through additional indicators or a significant price movement following the pattern. Here’s how traders may enhance its effectiveness: Seeking Additional Confirmation Using the Sushi Roll pattern in conjunction with other forms of analysis can significantly improve the reliability of the signals it generates. For instance, in markets like forex, stocks, and commodities, the impact of significant news events can align closely with technical signals. A news release that shifts market sentiment, such as unexpected corporate news or economic data announcements, can serve as strong confirmation if it aligns with the emergence of a Sushi Roll pattern. Utilising Momentum Indicators Incorporating momentum indicators such as the Stochastic Oscillator or Moving Average Convergence Divergence (MACD) can provide supplementary signals. Divergence on these indicators, where price movement and indicator direction do not align, can suggest weakening momentum and potential reversal. The crossing of the Stochastic back into normal range from overbought or oversold conditions, or a crossover in the MACD line vs its signal line, can also confirm the likelihood of a reversal following a Sushi Roll pattern. These indicators, alongside 1200+ trading tools, can be found in FXOpen’s free TickTrader platform. Strategic Placement and Timeframe Alignment The likelihood of a successful reversal increases if the Sushi Roll pattern forms at a key area of support or resistance. These levels are natural points where reversals are prone to occur. Additionally, if the pattern aligns with a higher timeframe trend, it provides further validation. For example, the pattern forming at the end of a bearish pullback in an overall bullish market may indicate the resumption of the upward trend. Entry and Risk Management Traders typically enter a trade after the Sushi Roll pattern is confirmed, which is marked by the price moving past, and ideally closing beyond, the high or low of the initial range of the pattern. Setting stop losses just beyond the extreme of the second range may help to manage risk. Given that the pattern aims to capture the onset of reversals, setting profit targets at forthcoming support or resistance levels—where another reversal could occur— may help maximise potential returns while managing exposure. The Bottom Line The Sushi Roll reversal pattern is an insightful tool for traders aiming to identify significant trend reversals. This pattern, especially when combined with additional indicators and contextual market analysis, can inform strategic entry and exit points, thereby potentially optimising trading outcomes. Traders interested in exploring this and other sophisticated trading strategies may consider opening an FXOpen account to access a world of advanced trading platforms and tools. FAQs What Is a Reversal in Stocks? A reversal in stocks refers to a change in the price direction of a stock. It marks the end of a current trend, either bullish or bearish, and the beginning of a new trend in the opposite direction. This shift is crucial for traders as it indicates potential entry or exit points based on the new trend's direction. What Is the Trend Reversal Pattern? The trend reversal pattern in technical analysis signals a potential change in the prevailing market trend. Examples include the Head and Shoulders, Double Tops and Bottoms, and the Sushi Roll reversal pattern. These patterns help traders identify when a trend might be shifting from upward to downward or vice versa. What Is the Best Reversal Indicator? The best reversal indicator can vary by trading style, but common choices include the Relative Strength Index (RSI), Moving Average Convergence Divergence (MACD), and Stochastic Oscillator. These tools help detect momentum shifts that may precede a price reversal. What Is Reversal vs Continuation Pattern? Reversal patterns indicate a potential change in the direction of the prevailing trend, leading to a new trend. In contrast, continuation patterns suggest that the current trend will persist after a brief pause or consolidation, such as triangles, flags, and pennants. Recognising these patterns helps traders anticipate and react to short-term price movements within broader trends. *At FXOpen UK and FXOpen AU, Cryptocurrency CFDs are only available for trading by those clients categorised as Professional clients under FCA Rules and Professional clients under ASIC Rules, respectively. They are not available for trading by Retail clients. This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.
Education
by FXOpen
2
NEW TOKEN LISTING: A Double-Edged Sword for Investors💡 The cryptocurrency market is a realm of endless opportunities, where prices can fluctuate wildly, shooting up 5-10% in a single day in either direction. This volatility can be both exhilarating and intimidating, as it can either wipe out investors or leave them with a quick windfall. However, not everyone is suited to navigate this fast-paced landscape. For those seeking more conservative returns, there are other options available. On the other hand, there are those who are willing to take greater risks in pursuit of substantial profits. One such strategy is to buy coins during the pre-sale period and sell them at their initial listing on the exchange. This approach can be lucrative, as savvy investors can capitalize on the initial hype and sell their coins at a significant markup. To generate buzz and attract attention, many new projects offer their coins for free in exchange for performing simple tasks or purchasing them at a discounted rate. When these coins are listed on the exchange, their value tends to plummet due to oversupply and subsequent sales. However, for those who manage to get in early and sell their coins before the price drops, the potential for significant returns – even 100% or more – is very real. 📍 PRE-LISTING INVESTMENT Recently, a new earning opportunity emerged in the online space, with BINANCE:NOTUSDT being the center of attention. The project's developers cleverly leveraged their marketing expertise to create a buzz around the coin. As a result, it gained widespread visibility, with numerous media outlets and cryptocurrency channels promoting the project. The idea was to generate revenue by simply tapping on your smartphone screen, with active users potentially earning around $300-$400. However, as soon as the coin listed on Binance, its price took a drastic dip. The price recovered after a few weeks, though. In a recent analysis of cryptocurrency tokens listed on Binance, it was found that a staggering 80% of new tokens have lost significant value over the past six months. The notable exceptions to this trend are a few meme coins, including BINANCE:MEMEUSDT and BINANCE:WIFUSDT , as well as tokens associated with the Solana protocol. 📍 THE STUDY HIGHLIGHTS THE FOLLOWING KEY REASONS 1️⃣ Firstly, developers often artificially inflate the cost of their tokens by issuing them at an undervalued price, which creates a surge in demand. Simultaneously, they sell their own share of the tokens, reaping the benefits. 2️⃣ Moreover, many coins lack a genuine long-term investor base and a strong community backing. This lack of support can be a red flag, indicating that these coins may be pre-destined to fail as a potential scam. 3️⃣ Furthermore, listed coins often lack growth potential, failing to meet the criteria for a sound investment instrument. Instead, they tend to attract attention from insiders and retail buyers who are willing to take risks and gamble on their investment. A portfolio comprising newly listed coins suffered an 18% decline in value over the past six months, while the market's blue-chip coins enjoyed significant gains during the same period. This stark contrast has led analysts to sound the alarm, warning that such a phenomenon can have far-reaching implications for the market's integrity. When investors, serving as the primary source of liquidity, inject their funds into poorly performing projects, they become disillusioned with the entire market. As a result, their money migrates towards established coins, leaving new initiatives struggling to secure funding and ultimately forcing them to shut down. Even innovative ideas with great potential are stifled by a lack of interest and resources. The solution to this problem lies in stricter regulation by cryptocurrency exchanges, which currently allow unscrupulous projects to exploit the market. However, exchanges are driven by profit, so this issue remains unresolved for now. 📍 CONCLUSION Identifying a token with potential for significant profit after listing can be a challenging and high-risk endeavor. The key factor in determining success is the interest of investors. If a coin is solely speculative, it is likely to experience a decline in value after listing. Conversely, if a token is backed by developers and has inherent value, it may have a chance to grow. However, with the vast majority of new tokens being scams, the risk of loss is significantly higher than the potential gain from a successful investment. From a risk perspective, this investment model appears unreasonable compared to long-term investments in established coins like BINANCE:BTCUSDT or top-tier cryptocurrencies. Traders, If you liked this educational post🎓, give it a boost 🚀 and drop a comment📣
Education
by Lingrid
5
Trade Like A Sniper - Episode 27 - GME - (8th June 2024)This video is part of a video series where I backtest a specific asset using the TradingView Replay function, and perform a top-down analysis using ICT's Concepts in order to frame ONE high-probability setup. I choose a random point of time to replay, and begin to work my way down the timeframes. Trading like a sniper is not about entries with no drawdown. It is about careful planning, discipline, and taking your shot at the right time in the best of conditions. A couple of things to note: - I cannot see news events. - I cannot change timeframes without affecting my bias due to higher-timeframe candles revealing its entire range. - I cannot go to a very low timeframe due to the limit in amount of replayed candlesticks In this session I will be analyzing Gamestop (GME), starting from the 4-Month chart. If you want to learn more, check out my other videos on TradingView or on YT. If you are interested in private coaching, feel free to get in touch via one of my socials.
NYSE:GMEEducation
by Road_2_Funded
WHAT IS TRADING ACCOUNT DRAWDOWN | 3 Types Of Drawdown Explained In my videos, I frequently use the term "trading account drawdown ". Many of you asked me to explain the meaning of that term and share some examples. What is Trading Account Drawdown? The account drawdown is the highest observed loss from the highest value of the deposit to the lowest value of the deposit at a certain period of time. Imagine you started to trade with 10,000$ account. At the end of the year, your account size reached 15,000$ . However, at some point through the year the deposit value dropped to 6,000$ . It was the absolute minimum for the one-year period. At some point, your net loss was -4,000$ or 40% of your account balance. The account drawdown is 40% . ❗️Knowing the account drawdown is very important for the risk assessment of the trading strategy. Usually, 50% and bigger drawdown signifies an extremely high risk. 3 Types of Drawdown 1. Current drawdown - a temporary drawdown associated with the negative total value of opened trading position(s) at present. Once you start trading with 10,000$ deposit, you open several trading positions. Being opened, with the constant price movements, your potential gains fluctuates from positive to negative. For example, with 3 active trades : EURUSD ( -500$ at present); GBPUSD ( +200$ at present); GOLD ( -100$ at present) Your current account drawdown is -400$ or 4% of your deposit. 2. Fixed drawdown - the negative value of the closed trading position(s) at present for a certain period of time. While some of your trades remain active, some are already closed . Imagine the same deposit - 10,000$ . On Monday you opened 6 trades, 2 still remain active ; 4 are already closed . Your total loss from your closed trades is -500$. Your fixed Monday's drawdown is 5%. 3. Maximum Drawdown - the maximum observed loss from the highest value of the deposit before a new maximum is reached. Starting to trade with 10,000$ you are already trading for 5 years . Your account were growing rapidly and at some moment it reached 25,000$ . Then the recession started. You faced a dramatic loss of 12,500$ before you started to recover. That was the maximum observed loss for the period. Your maximum account drawdown was 50% . ❗️Different types of drawdown give a lot of insights about a trading strategy. Its proper assessment will help to spot a high risk strategy and to find a conservative one. Constantly monitor your account drawdown and always check the numbers. What is your highest account drawdown?
OANDA:XAUUSDEducation
by VasilyTrader
1
Trade Like A Sniper - Episode 26 - CNYUSD - (8th June 2024)This video is part of a video series where I backtest a specific asset using the TradingView Replay function, and perform a top-down analysis using ICT's Concepts in order to frame ONE high-probability setup. I choose a random point of time to replay, and begin to work my way down the timeframes. Trading like a sniper is not about entries with no drawdown. It is about careful planning, discipline, and taking your shot at the right time in the best of conditions. A couple of things to note: - I cannot see news events. - I cannot change timeframes without affecting my bias due to higher-timeframe candles revealing its entire range. - I cannot go to a very low timeframe due to the limit in amount of replayed candlesticks In this session I will be analyzing CNYUSD, starting from the 4-Month chart. If you want to learn more, check out my other videos on TradingView or on YT. If you are interested in private coaching, feel free to get in touch via one of my socials.
Education
by Road_2_Funded
Trade Like A Sniper - Episode 26 - QQQ - (8th June 2024)This video is part of a video series where I backtest a specific asset using the TradingView Replay function, and perform a top-down analysis using ICT's Concepts in order to frame ONE high-probability setup. I choose a random point of time to replay, and begin to work my way down the timeframes. Trading like a sniper is not about entries with no drawdown. It is about careful planning, discipline, and taking your shot at the right time in the best of conditions. A couple of things to note: - I cannot see news events. - I cannot change timeframes without affecting my bias due to higher-timeframe candles revealing its entire range. - I cannot go to a very low timeframe due to the limit in amount of replayed candlesticks In this session I will be analyzing Investco QQQ Trust (QQQ), starting from the 4-Month chart. If you want to learn more, check out my other videos on TradingView or on YT. If you are interested in private coaching, feel free to get in touch via one of my socials.
NASDAQ:QQQEducation
by Road_2_Funded
Mastering the Art of Investing: Common Mistakes & solutionsLet's keep it straight to the point, Shall We? 1. Emotional Investing: One of the most prevalent mistakes is allowing emotions to drive investment decisions. Fear and greed can lead to impulsive actions, such as panic selling during market downturns or chasing speculative investments during bullish phases. Solution: Develop a well-thought-out investment plan based on your financial goals, risk tolerance, and time horizon. Stick to this plan, regardless of short-term market fluctuations. Regularly review and adjust your portfolio, but do so based on rational analysis, not emotional reactions. 2. Lack of Diversification: Concentrating all investments in a single asset or industry exposes investors to significant risks. If that particular investment performs poorly, it can have a devastating impact on the overall portfolio. Solution: Diversify your portfolio across different asset classes, industries, and geographic regions. This strategy helps reduce risk and improves the potential for more stable returns over the long term. 3. Market Timing: Attempting to time the market, i.e., buying and selling based on predictions of short-term price movements, is a common mistake. Even seasoned professionals struggle to consistently time the market correctly. Solution: Adopt a long-term investment approach. Time in the market is generally more important than timing the market. Stay invested and focus on your financial goals rather than trying to predict short-term market movements. 4. Overlooking Fees and Expenses: High investment fees and expenses can significantly erode returns over time. Many investors underestimate the impact of these costs. Solution: Be mindful of the fees associated with your investments, including expense ratios, broker commissions, and advisory fees. Consider low-cost index funds or exchange-traded funds (ETFs) as cost-efficient alternatives. 5. Ignoring Asset Allocation: Some investors focus solely on individual investments without considering how they fit into their overall portfolio. Neglecting proper asset allocation can expose portfolios to unnecessary risk. Solution: Determine an appropriate asset allocation based on your risk tolerance and investment goals. Rebalance your portfolio periodically to maintain the desired allocation. 6. Chasing Hot Tips and Fads: Acting on unsolicited stock tips or investing in the latest fads and trends can lead to poor decision-making and losses. Solution: Rely on thorough research and due diligence before making any investment. Avoid making impulsive decisions based on hearsay or the fear of missing out (FOMO). 7. Lack of Patience and Discipline: Investing is a long-term endeavor, and expecting quick riches can lead to disappointment and rash decisions. Solution: Cultivate patience and discipline in your investment approach. Stay committed to your long-term strategy and avoid making knee-jerk reactions to short-term market movements. Also, another good way of increasing discipline is giving us a boost for our efforts :) In conclusion, successful investing requires a well-structured plan, emotional resilience, and a commitment to disciplined decision-making. By avoiding these common mistakes and implementing the provided solutions, investors can increase their chances of achieving their financial goals and building a more secure financial future. Remember, investing is a journey, and learning from mistakes can ultimately lead to greater financial wisdom and success. Have Insights or Questions? Let us know in the comments below.👇 While you do that, how about a boost for some motivation🚀 ⚠️Disclaimer: We are not registered advisors. The views expressed here are merely personal opinions. Irrespective of the language used, Nothing mentioned here should be considered as advice or recommendation. Please consult with your financial advisors before making any investment decisions. Like everybody else, we too can be wrong at times ✌🏻
Editors' picks
NSE:M_MEducation
by TheChartereds
6
The Trend is Your FriendThis trend line is so simple yet so important for investors. above the trendline you will have your mini bull market. below the trend line where price currently is means XLM is in a bear market and you're only hoping for a bull market. as you can see, price broke above the trendline but failed to stay above it and broke down below the trendline continuing to be subdued by the bear market. people think just because the crypto market is in a bull market XLM is also in a bull market, which is only normal and reasonable to think that way, but when xlm chart has bear market signals written all over it, you can't lie to yourself forever. on the other hand, i will turn bullish once price breaks above this trendline and continues upward with a successful retest of the breakout. that is the safest way to play this chart. i would like to say upon successful retest of this trendline price target is 38-40 cents, but given the disastrous performance of XLM in this cycle, i would not be surprised if price struggles facing every single resistance level ahead.
Education
by SforShiraz
Trade Like A Sniper - Episode 25 - BABA - (8th June 2024)This video is part of a video series where I backtest a specific asset using the TradingView Replay function, and perform a top-down analysis using ICT's Concepts in order to frame ONE high-probability setup. I choose a random point of time to replay, and begin to work my way down the timeframes. Trading like a sniper is not about entries with no drawdown. It is about careful planning, discipline, and taking your shot at the right time in the best of conditions. A couple of things to note: - I cannot see news events. - I cannot change timeframes without affecting my bias due to higher-timeframe candles revealing its entire range. - I cannot go to a very low timeframe due to the limit in amount of replayed candlesticks In this session I will be analyzing Alibaba (BABA), starting from the 6-Month chart. If you want to learn more, check out my other videos on TradingView or on YT. If you are interested in private coaching, feel free to get in touch via one of my socials.
NYSE:BABAEducation
by Road_2_Funded
IPO Investing: Bad or Very Bad ?IPOs can be enticing opportunities for investors to jump into potentially high-growth companies from their early stages. While IPOs can offer significant returns, a strategy of investing in every IPO that hits the market is not considered prudent. Let us explore several key reasons why such an approach is unwise for investors. Lack of Information: IPOs often lack comprehensive financial history and operating data. As a result, investors have limited insights into the company's performance, growth prospects, and competitive positioning. Investing without adequate information increases the risk of making uninformed decisions and exposes investors to potentially unprofitable ventures. Limited Track Record: Since many IPOs are relatively young companies, they often lack a substantial track record in navigating economic downturns or industry-specific challenges. Assessing their long-term sustainability is just impossible. High Valuations: IPOs tend to be priced at a premium to attract investor interest. Especially, When innovative companies go public, It becomes difficult to value such companies owing to the absence of any market comparable. The result is higher valuations. An epic example is NSE:PAYTM . Also, If you boost this post, It would help us to reach many like-minded investors like you. Uncertain Performance: When valuations are high, so are the expectations. Newly listed companies face challenges in meeting the high expectations set by the market. While some perform exceptionally well, others struggle to deliver. This brings panic. Diversification Concerns: Investing in every IPO can create an imbalanced portfolio. The preset proportions may go haywire. Especially, when investors are forced to become long-term investors in a company due to a substantial decline in the stock price post listing. Conclusion: While IPOs may offer the allure of early-stage growth and potential windfall gains, investing in every IPO is not a wise strategy for investors. The lack of information, market volatility, high valuations, uncertain performance, and limited track record are among the key concerns. Instead, investors should approach IPOs cautiously, conduct thorough research, and focus on building a diversified portfolio that aligns with their risk tolerance and long-term investment goals. Have Insights or Questions? Let us know in the comments below.👇 ⚠️Disclaimer: We are not registered advisors. The views expressed here are merely personal opinions. Irrespective of the language used, Nothing mentioned here should be considered as advice or recommendation. Please consult with your financial advisors before making any investment decisions. Like everybody else, we too can be wrong at times ✌🏻
NSE:NYKAAEducation
by TheChartereds
6
BARBEQUE NATION: The Psychology of YOUR tradesEmotions play a significant role in trading and can have a profound impact on decision-making and overall trading performance. Here are some common emotions that traders experience and how they can influence trading behavior: 1. Fear: Fear is a powerful emotion that often arises when traders face unexpected market movements or potential losses. It can lead to impulsive decisions, such as closing a position prematurely or avoiding new trades altogether. Fear can prevent traders from sticking to their trading plans and strategies, ultimately hindering their ability to make rational choices. 2. Greed: Greed is the desire for excessive profits and can lead traders to take unnecessary risks. It often emerges during bullish market trends when traders become overly confident and start making impulsive trades. Greed can cloud judgment and cause traders to hold onto positions longer than they should, leading to significant losses when the market reverses. 3. Hope: While hope can provide optimism, it becomes problematic when it's not based on logical analysis. Traders may hold onto losing positions hoping for a turnaround, ignoring warning signs that indicate the trade is unlikely to recover. Balancing hope with realistic assessments of market conditions is crucial to avoid capital erosion. 4. Regret: Regret can arise from missed opportunities or poor decisions. Traders may feel remorse for not entering a trade that subsequently turns profitable, or they may regret entering a trade that results in losses. Regret can lead to impulsive actions, such as chasing trades or deviating from the trading plan to make up for perceived missed opportunities. 5. FOMO (Fear of Missing Out): FOMO can lead traders to make rushed decisions in an attempt to catch up with perceived profitable opportunities. This can result in impulsive trading and following the crowd without proper analysis. FOMO-driven actions often disregard risk management and trading strategies, leading to poor outcomes. 6. Ego: Ego can arise from both winning and losing trades. A trader with a big ego may become overconfident after a string of successful trades, leading to complacency and neglect of risk management. Conversely, a trader who experiences losses may let their ego drive them into revenge trading, seeking to prove themselves and recover losses without a sound strategy. Successful traders learn to manage these emotions through discipline, self-awareness, and a well-defined trading plan. They understand that emotions can cloud judgment and lead to impulsive decisions, so they prioritize rational analysis and risk management to achieve consistent and profitable trading outcomes. Should we also post on the set of practices we personally follow to build disciplined psychology? It takes a lot of time and effort to compile such posts. If it was worth your time, Would you give us a boost? Have Requests, Questions, or Suggestions? DM us or comment below.👇 ⚠️Disclaimer: We are not registered advisors. The views expressed here are merely personal opinions. Irrespective of the language used, Nothing mentioned here should be considered as advice or recommendation. Please consult with your financial advisors before making any investment decisions. Like everybody else, we too can be wrong at times ✌🏻
NSE:BARBEQUEEducation
by TheChartereds
1
What Traders and Rock Climbers Have in Common!This post is inspired by @TradingView's rebranding in 2021 and the recent Leap competition. At first glance, trading and rock climbing might seem worlds apart. One involves analyzing market trends, while the other requires physical strength and agility. However, both pursuits share surprising similarities, highlighting unique skills and mindsets. Here’s a look at what traders and rock climbers have in common. ⚙️ Risk Management: Both traders and rock climbers excel at managing risk. Traders use strategies like stop-loss orders and portfolio diversification to protect their capital. Rock climbers assess risks, use safety equipment, and plan routes to avoid danger. Effective risk management is crucial in both fields to prevent catastrophic outcomes. 💡Mental Toughness: Traders face market fluctuations and must make quick decisions under pressure. Rock climbers need to stay focused and composed while navigating challenging routes. Both activities demand mental resilience to overcome fear, maintain focus, and make calculated decisions. 📊 Strategic Planning: Success in trading and rock climbing involves strategic planning. Traders develop strategies based on market analysis and economic indicators, while rock climbers meticulously plan their ascents, studying routes and assessing conditions. Strategic planning helps achieve goals efficiently in both areas. ⚖️ Adaptability: Adaptability is key for both traders and rock climbers. Market conditions can change rapidly, requiring traders to adjust their strategies. Rock climbers face changing conditions like weather and rock quality, adapting their techniques to overcome obstacles and reach their objectives. 📜 Continuous Learning: Both traders and rock climbers are committed to continuous learning. Traders stay updated on market trends and new tools, while rock climbers seek to improve their skills and stay informed about gear and safety practices. The pursuit of knowledge drives success in both fields. 🧘‍♂️ Focus on Execution: Execution is crucial in trading and rock climbing. Traders need precision, timing, and discipline to execute trades effectively. Rock climbers must execute their moves with precision and confidence to progress safely. The ability to execute under pressure is essential for success in both activities. 🔄Passion and Commitment: Passion and commitment are integral to both trading and rock climbing. Traders have a deep interest in financial markets, while rock climbers are driven by their love for the sport and adventure. This passion fuels their dedication, driving them to invest time and effort into their pursuits. 🧗‍♀️ Conclusion: Despite their apparent differences, trading and rock climbing share many commonalities. Both require effective risk management, mental toughness, strategic planning, adaptability, continuous learning, focus on execution, and a deep-seated passion. Recognizing these parallels can provide valuable insights and inspiration for those engaged in either pursuit, highlighting the universal qualities that drive success in diverse fields. 📚 Always follow your trading plan regarding entry, risk management, and trade management. Good luck! All Strategies Are Good; If Managed Properly! ~Richard Nasr
Education
by TheSignalyst
10
Mastering Multiple Timeframe Trading StrategiesMastering Multiple Timeframe Trading Strategies In the fast-paced world of trading, the ability to analyse and interpret multiple timeframes can be one of the advantages of a trader. In this FXOpen article, we will delve into the concept of multiple timeframes in trading and consider two multiple timeframe trading strategies based on it. Understanding Multiple Timeframes Multiple timeframes refer to the simultaneous analysis of price data across charts with different periods. This approach allows traders to gain a comprehensive view of the market's dynamics. The use of multiple timeframes is paramount in trading for several reasons. By analysing various time intervals, traders may: - Properly analyse the overall market trend. - Identify potential entry and exit points. - Enhance risk management by assessing the broader context. - Avoid being trapped by short-term market noise and false signals. Selecting Timeframes Trading on multiple timeframes usually means confirming signals on charts with two or three different periods. More intervals may confuse traders with excessive market noise. Choosing the Primary Timeframe The primary timeframe serves as the foundation of your trading strategy. It's essential to select a primary timeframe that resonates with your trading style and objectives. Here's why it matters: Alignment with Trading Style: Your primary timeframe should align with your preferred trading style. For example, if you are a day trader looking for quick, short-term opportunities, a primary timeframe of 1-hour or 15-minute charts may be suitable. On the other hand, if you are a swing trader seeking more extended trends, daily or weekly charts might be your primary choice. Clarity of Signals: The primary timeframe should provide clear and actionable signals. It's the timeframe where you identify key support and resistance levels, chart patterns, and trend directions. The primary timeframe is where you make your core trading decisions. Selecting Secondary Timeframes While the primary timeframe forms the core of your strategy, the secondary one complements and reinforces your analysis. These secondary timeframes offer additional perspectives and confirmation. Here's how you may choose one: Alignment with Primary Timeframe: Secondary timeframes should align with your primary period. For instance, if your primary period is the daily chart, you may consider a secondary interval, such as 4-hour or 1-hour charts. The secondary timeframes should provide a more detailed view without straying too far from your primary analysis. Confirmation and Entry Timing: Use secondary timeframes to confirm signals from your primary analysis. When the primary chart generates a potential trade signal, consult the secondary one to validate it. This additional confirmation may enhance the reliability of your decisions and help you time your entries more accurately. Managing Risk: Secondary timeframes can also assist in managing risk. By assessing shorter periods, you can identify intraday fluctuations and adjust your stop-loss and take-profit levels accordingly. Multiple Timeframe Trading Strategies Below, you will find two trading strategies that use multiple time frames to trade. Swing Trading Strategy with Multiple Timeframes Timeframes Used: - Primary: Daily Chart - Secondary: 4-Hour Chart Indicators and Tools: - Exponential Moving Averages (EMA) - 14-period and 21-period - Relative Strength Index (RSI) - 14-period - Fibonacci Retracement Tool Entry and Exit Points: Entry Point (Long Trade): When the daily chart shows an uptrend (a 14-period EMA above a 21-period EMA) and an RSI above 50, and the 4-hour chart reveals a pullback to a Fibonacci support level: You may enter a long trade with a stop-loss just below the support level on the 4-hour chart. You may set a take-profit target at a resistance level or when the 4-hour chart shows signs of a potential reversal. Entry Point (Short Trade): When the daily chart indicates a downtrend (a 14-period EMA below a 21-period EMA) and an RSI below 50, and the 4-hour chart exhibits a retracement to a Fibonacci resistance level: You may enter a short trade with a stop-loss just above the resistance level on the 4-hour chart. You may set a take-profit target at a support level or when the 4-hour chart reflects a potential reversal. You may use trailing stop-loss to partially close your trade and lock in the returns that have already been reached. On the chart above, the 14-day EMA broke below the 21-day EMA, while the RSI indicator was below 50. A trader could have considered this as a signal to open a short position. When the trader switched the timeframe, they may have noticed that the price rebounded from the 23.6% Fibonacci level. This could be considered as an entry point. A stop-loss could have been placed above the closest Fibonacci level (38.2% in this case) to fulfil a standard risk/reward ratio. The take-profit target would depend on the trader’s trading approach. Multiple Timeframe Analysis for Day Trading Timeframes Used: - Primary: 15-Minute Chart - Secondary: 1-Hour Chart Indicators and Tools: - Exponential Moving Averages (EMA) - 9-period and 50-period - Relative Strength Index (RSI) - 14-period - Support and Resistance Levels Entry and Exit Points: Entry Point (Long Trade): When the 15-minute chart shows an uptrend (a 9-period EMA above a 50-period EMA), the RSI indicates bullish momentum, and the 1-hour chart confirms a support level: You may enter a long trade with a stop-loss just below the support level on the 15-minute chart. You may set a take-profit target at a resistance level or when the 15-minute chart reflects a potential reversal. Entry Point (Short Trade): When the 15-minute chart indicates a downtrend (a 9-period EMA below a 50-period EMA), the RSI indicates bearish momentum, and the 1-hour chart confirms a resistance level: You may enter a short trade with a stop-loss just above the resistance level on the 15-minute chart. You may set a take-profit target at a support level or when the 15-minute chart reflects a potential reversal. On the chart above, created on the TickTrader platform, a trader may have spotted conditions for a long trade (the 9-period EMA was above the 50-period EMA, and the RSI indicator was above 50). Checking the hourly chart, they may have noticed that the conditions occurred when the price rebounded from the support level. Moreover, the RSI indicator broke above the 50 level, signalling potential upward movement. A trader could have opened a long position with a stop-loss order below the most recent swing point. Mistakes to Avoid Trading on multiple timeframes may be a powerful approach to gaining a comprehensive overview of the market and making more informed trading decisions. However, it also introduces complexities that traders need to navigate carefully. Here are some common mistakes to avoid: Neglecting the Primary Timeframe. One of the most significant mistakes is focusing too heavily on the secondary timeframe and neglecting the primary one. The primary one provides the overall trend direction and context, so it's essential not to lose sight of it. Overcomplicating Analysis. Trading on multiple timeframes can become overwhelming if you overcomplicate your analysis. Using too many multi-timeframe indicators, tools, or charts can lead to analysis paralysis. Keep your approach simple and effective. Ignoring Conflicting Signals. It's not uncommon for different periods to produce conflicting signals. Avoid the mistake of trading solely based on one chart without considering the broader context. Conflicting signals should prompt caution and further analysis. Chasing Short-Term Trends. Day traders may sometimes fall into the trap of chasing short-term trends on very small periods. Avoid the mistake of becoming too focused on micro-trends without considering the bigger picture. Overlooking Risk Management. Regardless of their trading approach, traders should use proper risk management. It's essential to set stop-loss and take-profit levels based on your analysis and risk tolerance for each trade. Neglecting the Market Context. Trading solely based on technical analysis from multiple timeframes may lead to neglecting the broader market context. Be aware of significant economic events, news releases, or geopolitical factors that could impact the market. Final Thoughts Trading on multiple timeframes can be a potent tool when used correctly, but it also comes with its challenges. Avoiding the common mistakes and maintaining discipline in your analysis and execution may lead to more effective trading. If you want to test multi-timeframe trading strategies, open an FXOpen account now! This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.
Education
by FXOpen
2
Trade Like A Sniper - Episode 21 - INTC - (7th June 2024)This video is part of a video series where I backtest a specific asset using the TradingView Replay function, and perform a top-down analysis using ICT's Concepts in order to frame ONE high-probability setup. I choose a random point of time to replay, and begin to work my way down the timeframes. Trading like a sniper is not about entries with no drawdown. It is about careful planning, discipline, and taking your shot at the right time in the best of conditions. A couple of things to note: - I cannot see news events. - I cannot change timeframes without affecting my bias due to higher-timeframe candles revealing its entire range. - I cannot go to a very low timeframe due to the limit in amount of replayed candlesticks In this session I will be analyzing Intel (INTC), starting from the 6-Month chart.
NASDAQ:INTCEducation
by Road_2_Funded
ICT's Market Maker Model - An Easy to Understand GuideIn this video I try to explain ICT's Market Maker Model as simply as I can. This model basically depicts how smart money efficiently facilitates their positions in the marketplace. It is important to understand some concepts beforehand, such as liquidity, AMD/PO3, market efficiency, crowd mentality, and the fractal nature of price. I hope you find the video insightful and that it helps you utilize Market Maker Models in your trading. - R2F
Education
by Road_2_Funded
2
Brilliant Basics - Part 3: Harnessing the Power of Moving AveragWelcome to the third instalment of our Brilliant Basics series, where we help you achieve consistency and discipline in foundational concepts that create a platform for long-term success. Today, we’re harnessing the power of moving averages. We will explore how to use them effectively and consistently to enhance your trading. Moving Averages: Momentum Versus Mean Reversion Moving averages are a beautifully simple and robust indicator that can be used to gauge a market’s level of momentum and its level of mean reversion. Momentum: Simply by looking at where the price is in relation to a moving average, and the slope of the moving average can tell you a lot about a market’s momentum. Is the price above or below the moving average? How far away from the moving average is the price? Is the slope of the moving average rising or falling? These simple observations can be used to construct robust and objective rule sets for defining trade entries and trade exits. Example: In the below example of the S&P 500’s daily candle chart, we can see that the 9-period exponential moving average (EMA) is sloping higher and moving away from the 21 EMA – signalling a market with strong momentum. However, the price is now quite far from both moving averages – indicating that the market could be vulnerable to profit-taking. Past performance is not a reliable indicator of future results Mean Reversion: When a market is trending, it cycles from periods of momentum to mean reversion. Moving averages provide a dynamic benchmark for how far the price has pulled back from trend highs. Example: Sticking with the same market as used in our momentum example, we can see that the market has cycled from its momentum phase to its mean reversion phase – pulling back towards the 21 EMA Past performance is not a reliable indicator of future results Selecting the Right Moving Averages for Your Trading Style Different trading styles require different moving average settings to effectively capture market movements. Here’s how you can choose the right settings for your approach: Position Trading: Daily Simple Moving Averages (SMA’s) For position traders who hold trades for weeks or months, the 200 SMA and 50 SMA are essential tools. These moving averages provide a broad view of the market's direction and help identify long-term trends. Past performance is not a reliable indicator of future results Swing Trading: Daily Exponential Moving Averages (EMA’s) Swing traders, who typically hold trades for 2-5 days, benefit from the more responsive nature of EMAs. The 21 EMA and 9 EMA are popular choices, allowing traders to capture shorter-term price movements and react quickly to market changes. Past performance is not a reliable indicator of future results Day Trading: 5-Minute EMA’s and VWAP Day traders need even more sensitivity to price movements. Using 5-minute EMAs along with the Volume Weighted Average Price (VWAP) provides an excellent framework for intraday trading. The VWAP, in particular, helps day traders identify the average price over a trading session, factoring in volume, which is crucial for short-term decision-making. Past performance is not a reliable indicator of future results 3 Steps to Harness the Power of Moving Averages 1. Be Consistent: Use the same moving average settings consistently across your analyses. Consistency ensures that you build a reliable and repeatable process for making trading decisions. 2. Target Pullback Zones: Moving averages act as dynamic support and resistance levels. Target these zones for potential entry points in the direction of the trend. For example, in an uptrend, look for buying opportunities when the price pulls back to the moving average. 3. Combine with Price Patterns: Enhance the effectiveness of moving averages by combining them with price patterns. Patterns such as flags, pennants, and double bottoms can provide additional confirmation for trade entries and exits. Example: In this swing trading example, notice how EUR/USD pulls back to the upward sloping moving averages. When price does this, the confluence of the moving average and a simple price pattern can provide a strong signal for entering a long trade. Past performance is not a reliable indicator of future results Summary Moving averages are an indispensable tool in a trader’s arsenal, offering insights into both momentum and mean reversion. By selecting the right moving averages for your trading style and consistently applying them, you can significantly enhance your analysis. In our penultimate instalment, Part 4, we will delve into Multi-Timeframe Analysis , helping you understand how to align strategies across different timeframes for more robust trading decisions. Stay tuned! Disclaimer: This is for information and learning purposes only. The information provided does not constitute investment advice nor take into account the individual financial circumstances or objectives of any investor. Any information that may be provided relating to past performance is not a reliable indicator of future results or performance. Social media channels are not relevant for UK residents. Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 80.84% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money.
Education
by Capitalcom