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Trend Analysis

💰WHAT IS SUPPLY AND DEMAND? In trading, the fundamental concept of supply and demand serves as the cornerstone for understanding price movements. Supply represents the quantity of a particular asset available for purchase, while demand signifies the desire of buyers to acquire that asset. When supply exceeds demand, prices typically decrease as sellers compete to attract buyers. Conversely, when demand surpasses supply, prices tend to rise due to heightened competition among buyers. To contextualize this concept using Bitcoin as an example, let's consider its decentralized nature and limited supply. Bitcoin's supply is predetermined and capped at 21 million coins, with new coins created through mining at a diminishing rate. Meanwhile, demand for Bitcoin fluctuates based on various factors such as market sentiment, institutional interest, regulatory developments, and macroeconomic trends. By analyzing supply and demand dynamics, traders can gauge market sentiment and anticipate potential price movements. High volume players, such as institutional investors or large-scale traders, often leave discernible footprints in the market through their buying and selling activities. Tracking these players' actions can provide valuable insights into shifts in supply and demand dynamics. In practice, traders employ various techniques and rules to identify supply and demand levels on price charts. These may include analyzing price structure, volume profiles, support and resistance zones, and price action patterns. By accurately identifying supply and demand areas, traders can make informed decisions regarding market entry, exit, and risk management strategies. Follow for more
Education
by Trade-Journal
WHAT ARE REAL WORLD ASSETS (RWA)?Just 3-5 years ago, the concept of "real assets" was clear-cut - physical items that could be owned such as stocks, gold, and currency. On the other hand, "derivatives" referred to intangible assets like swaps, options, and CFDs that allowed for profit-making. However, the emergence of cryptocurrencies and blockchain technology has completely transformed this landscape. Not long ago, cryptocurrencies were seen as a separate entity, often labeled as a risky and unsecured financial scheme. But today, they are being recognized as valuable commodities and even as securities. What's even more fascinating is the rise of a new category - Real World Assets. 💡 Real World Assets are a unique category of financial instruments that are based on blockchain technology. 💹 Real World Assets is a market where real world assets are tokenized on the blockchain. These tokenized assets, which we refer to as real assets, are essentially moving traditional assets into decentralized financial applications. The goal is to leverage technology to potentially lower fees and management costs associated with these assets. 📍 REAL WORLD ASSETS EXAMPLES: ➡️ Stablecoins are a type of cryptocurrency that are centralized and backed by real assets. For instance, Tether's USDT is backed by stocks, government bonds, and fiat currencies, and undergoes some level of auditing. This process is known as tokenization, where the value of the collateral is denominated in stablecoins equivalent to fiat money. The pegging ratio is 1:1, meaning that the value of the stablecoin is directly tied to the value of the underlying assets. Any fluctuations in the value of the assets are balanced out by adding more collateral to maintain the stability of the stablecoin. 🔴 One major drawback of this model lies in the vulnerability to fluctuations in exchange rates of the real asset. In the event that stocks experience significant drawdowns of 20-30%, it is essential for the collateral to be able to mitigate this risk. Furthermore, as the stock value increases, Tether continues to issue additional USDT. Traders are already familiar with the challenges of decoupling stablecoins from their corresponding assets, particularly in the case of centralized stablecoins as opposed to algorithmic ones. ➡️ Private lending, specifically in the form of decentralized lending, has seen a significant player emerge in the form of DAO MakerDAO, the issuer of the DAI stablecoin. In a major move, this startup secured a hefty $100 million credit line with a US bank in mid-2022, backed by real assets as collateral. The startup was able to profit from this arrangement with an impressive 3% annual return. It is noteworthy that regulators did not pay attention to this deal. ➡️ Government bonds are a popular choice for investors seeking stability. Some companies have taken this a step further by issuing stablecoins that are backed by government securities. For example, Ondo Finance offers the USDY stablecoin, while Mountain Protocol offers USDM, which is based on Ethereum. These startups manage stablecoins backed by U.S. Treasury bonds, considered one of the most reliable instruments in the market. Investors can also earn passive income of 5% on top of the stability these investments offer. ➡️ Tokenized securities are on the rise, although the market has not yet reached its full potential. Bitfinex exchange is at the forefront of this trend, with their subsidiary launching the first tokenized bonds in October 2023. These bonds offer investors a tempting yield of 10% and a three-year maturity period. In essence, these tokenized securities work much like traditional bonds, where investors trade tokens for a share of the security and receive passive income in return. 🔴 Investors should be intrigued by the inquiry into how the issuer plans to allocate the funds raised and where the profit is being generated from. This question remains unanswered, as the tokenization process is still evolving. By 2024, HSBC, the British bank, is gearing up to introduce a service for managing tokenized bonds. In October 2023, JPMorgan and Barclays, along with investment firm BlackRock, unveiled a platform for transforming shares into digital assets called the Tokenized Collateral Network. ➡️ Green tokens are an emerging trend in the world of digital assets, with artificial intelligence specifically identifying them as a key player in the future. An interesting fact is that KlimaDAO, a startup backed by billionaire Mark Cuban, ultimately did not succeed in its mission to raise funds to incentivize companies to reduce their emissions. Despite this setback, the concept of green investments and tokens is likely to become a prominent tool in the future. This new form of investment may revolutionize the way companies approach sustainability and incentivize environmentally conscious behaviors. Stay tuned for more developments in the world of green tokens. ➡️ Paxos, a startup in the cryptocurrency industry, has made a connection to precious metals through the creation of gold tokens. Pax Gold has successfully replicated the value of physical gold, allowing investors to easily participate in the gold market without the need to purchase actual bullion or deal with brokers and confusing financial instruments like CFDs and swap fees. By purchasing PAXG cryptocurrency, investors can securely store it in a cold wallet, minimizing the risks associated with exchange bankruptcies or broker insolvencies. ➡️ In January 2023, the real estate startup MarketDAO facilitated a $7 million loan in cryptocurrency DAI to a French conglomerate. The loan was backed by mortgage bonds worth $40 million in US dollars. While this practice is still inconsistent, it marks the beginning of a promising trend in the real estate industry. ➡️ Paintings, sculptures, and other works of art, as well as collectibles, have long been valued for their beauty and uniqueness. The original concept behind NFTs was to revolutionize ownership by tying it to the blockchain, thereby ensuring copyright protection. In 2021-2022, we witnessed the initial steps towards digitizing and transferring paintings onto the blockchain. The future of this trend remains uncertain, but the concept has proven to be functional and shows promise for the art world. 🔴 The prospects for Real World Assets are significant and promising. However, accurately assessing these prospects is currently difficult as the tool is still in development and has not yet found its niche. Several factors are necessary for its success. 1️⃣ Firstly, there needs to be greater user engagement in cryptocurrency and digital technologies. Despite the widespread availability of the internet, not everyone has sufficient knowledge about these topics, let alone blockchain technology. 2️⃣ Secondly, there needs to be real interest and potential benefits from the tool. This can manifest in various ways, such as generating profit or simplifying certain actions. For example, the tool could speed up data transfers, protect copyrights, and make it more accessible for everyday users. Users must see the usefulness of the tool for it to be successful. 📍 CONCLUSION Currently, the reality is that the global market is valued at hundreds of trillions of dollars, a figure that the cryptocurrency market cannot compete with. For instance, as of 2020 estimates, the worldwide real estate market is valued at approximately $326 trillion in US dollars. According to RWA.xyz, the funds locked in blockchain technology total $4.5 billion, with just over $500 million in loans issued. However, the revolution of Real World Assets technology is on the horizon. In the next 1-2 years, this tool will begin gaining traction among the masses, similar to the rise of artificial intelligence in 2023. It is predicted that in 5 years, RWA technology will reach its peak of popularity. Traders, If you liked this educational post🎓, give it a boost 🚀 and drop a comment
Education
by Lingrid
1
Random Walk? I Would Rather Have Directions Too many traders think they are taking a Random Walk through these market streets. Well this post is to help them define a direction. Can you use this to target the exact price and day/hour/min? No (well sometimes you can nail it) But just like the Map App on your phone it will get you within a certain degree of accuracy AND you will definitely generally no where you are in relationship to where you want to be More to come!!!
TVC:SPXEducation
by Heartbeat_Trading
EURUSD Trade study short/longTrade study using Asian range. Trade went below opening candle in London session indicating bullish but wasn't noticed. Price also took the Asian lows before moving up. Price then consolidated before taking the Asian high, then took the recent swing low at lower timeframe indicating out POI. Price then eventually achieved our target Price Asian range low then took Thursdays (Asian high +4) before taking our initial Target (Asian range -1). Trading in Friday is complicated but with proper risk management we was able to take a 1:1.2rr trade Using proper risk management is always necessary which I didn't do for some reason NOTE : PRICE ALWAYS MOVES FOR A REASON
Education
by xppreciate
How to Start Forex Trading. Step-by-Step Learning Plan Hey traders, If you are wondering how to start Forex trading, or you just started to trade, I suggest a 12 weeks intensive learning plan. Each week will be dedicated to a specific topic. Starting from the basics you will gradually mature and by the end of the intensive you will have a complete trading strategy. ✔️Week 1 - Practice market trend identification Learn to identify the direction of the trend. Master the recognition of a bullish trend, bearish trend and sideways market. ✔️Week 2 - Practice support and resistance. Learn to identify key levels. Master support & resistance recognition. ✔️Week 3 - Learn candlestick patterns. Study classic candlestick formations and practice their recognition. ✔️Week 4 - Learn price action patterns. Study classic price action patterns: trend-following patterns, reversal patterns and consolidation pattern and learn to recognize them. By the end of the first month, you will mature the basics of candlestick chart analysis. ✔️Week 5 - Practice supply and demand zones. Learn to identify supply and demand zones. Learn to combine candlestick analysis with support and resistance to identify the potential reversal zones. ✔️Week 6 - Practice multiple time frame analysis. Master top-down analysis. Learn to apply all the techniques studied previously on multiple time frames. ✔️Week 7 - Learn different entry strategies. With all the knowledge being obtained, you can practice different entry techniques. You can try trading candlesticks patterns or price action patterns, or simply key levels. Search what works for you. ✔️Week 8 - Learn risk management. Of course, entry strategies are not enough for profitable trading. Learn how to set stop loss and how to manage your risks properly. By the end of the second month, you will have a foundation for a strategy building. ✔️Week 9 - Practice trade management. Knowing how to enter the trade and how to manage the risks, the next step is to learn how to manage the active position (stop loss trailing, position protection, manual closing, etc.) ✔️Week 10 - Create a trading plan. Combine all the knowledge that you gained in a structured trading plan. ✔️Week 11 - Follow the strategy. Be disciplined and follow your rules. Test them and learn to be consistent. ✔️Week 12 - Review your plan. Following your strategy, you will inevitably find its flaws. Learn to constantly improve it. By the end of the third month, you will have a complete rule-based trading strategy. Of course, that won't be a perfect strategy, but you will have broad knowledge in technical analysis. The next 3 months alone should be sacrificed on polishing and improvement of your trading plan. Try this intensive, traders. I strongly believe that you will see a dramatic improvement in your trading upon its completion.
OANDA:XAUUSDEducation
by VasilyTrader
1
Intuitive chart: Volume Candles chartHello traders! If you "Follow" us, you can always get new information quickly. Please also click “Boost”. Have a good day. ------------------------------------- (Candles chart and Volume Candles chart) Usually, you see price and volume displayed separately on the chart. Displaying it this way has the advantage of showing the overall flow, but since it must be viewed separately, it may be difficult to interpret when a quick judgment is required. In order to trade based on movements in real time, you need to be able to quickly interpret charts. Therefore, I think it is best to check charts intuitively. TradingView Charts finally supports Volume Chandles charts. We combined trading volume with price movements to make it more intuitive and faster to check. When trading volume is high, the candles appear thick, and when trading volume is low, the candles appear thin. (Volume Candles chart) If you add indicators to your chart, you will notice that support and resistance points are more clearly visible. Starting tomorrow, we will set it up according to the Volume Candles chart and publish it. Have a good time. thank you --------------------------------------------------
Education
by readCrypto
Opening Range Breakout StrategyOpening Range Breakout Strategy The Opening Range Breakout (ORB) is a classic trading strategy designed to capitalise on volatility during the first few minutes following the market's opening bell. Rooted in principles laid down in the 1960s, the strategy remains relevant today for both stock and forex markets. This article dives deep into the ORB strategy and its application in these markets. Overview of the Opening Range Breakout Trading Strategy The ORB, or the Opening Range Breakout, is a tried-and-true approach in the world of trading that focuses on the price range established shortly after a market opens. Invented in the 1960s by American trader Arthur Merrill, this strategy has stood the test of time, with variations and adaptations made to suit modern trading environments. ORB operates on the principle of monitoring price movements within a set time, typically the first 30 minutes after the market opens—common timeframes include 5, 15, and 30 minutes. The strategy zeroes in on the highest and lowest prices reached during this opening range. However, some traders will use the close of the previous trading day as their initial high or low. Traders keen on trading the opening range breakout pay close attention to these high and low levels, as a breakout or breakdown from these levels can indicate a strong trend. Using the ORB for Stocks Trading the Opening Range Breakout in the stock market offers distinct advantages, primarily due to the well-defined opening and closing times of the stock exchanges. These regulated timeframes provide a clear structure for implementing the ORB strategy. Typically, stock traders focus on the initial 5 to 30 minutes post-opening bell to define the range, as this period often captures the essence of market sentiment. Liquidity is usually high during this time, and volumes are significant, making it easier to enter and exit positions. The strategy is particularly effective in identifying trends early in the trading session. However, it's crucial for traders to also consider the current trend. Looking for entries in the broader trend direction can reduce the odds of being misled by a false breakout. Using the ORB for Forex In forex, the Opening Range strategy can also be effectively applied, albeit with some unique considerations. Unlike the stock market, forex operates 24 hours a day, five days a week, with no clearly defined opening or closing times. Despite this, traders can still focus on specific trading sessions—such as the London, New York, or Tokyo sessions—to define an opening range. Liquidity and trading volume can vary substantially between these sessions, affecting a trader’s success when using the opening range breakout method. Additionally, it's essential to be mindful of currency pairs; each pair may have increased activity and, therefore, more reliable breakouts during the session of its originating country. Lastly, given the almost continuous trading, overnight gaps are rare, making a careful session-based approach critical for forex ORB. Breakout Strategy The opening breakout strategy is a widely used approach to capitalise on strong upward or downward movements that break the defined opening range. To see how it works for yourself, you can head over to FXOpen’s free TickTrader platform. There, you’ll be able to explore a wide range of forex and stocks to test this strategy out. Entry Traders often monitor the price as it approaches the high or low of the opening range, typically using the 5, 15, and 30-minute charts. The opening range is generally defined as the first 30 minutes of the session. Entry confirmation typically comes from a candle closing above the high for a bullish breakout or below the low for a bearish one. Stop Loss A stop loss is commonly set just below the opening range high for bullish trades or above the low for bearish trades. Factors like market volatility and liquidity are often taken into consideration when placing the stop loss. Take Profit The target profit is often set at a distance at a given risk/reward ratio, like 2:1 or 3:1, measured from the entry point to the stop loss. Consideration is usually given to major support or resistance levels that lie beyond the target, which could affect the trade's success. Pullback Strategy The pullback strategy within the ORB framework offers traders an alternative approach that seeks additional confirmation before initiating a trade. This strategy can be particularly useful in markets where false breakouts are common. Entry Rather than entering immediately on a breakout, traders often wait for the price to break beyond the opening range and then retrace back to the high or low of that range or to a relevant support or resistance level within the range. Stop Loss Stop losses are typically placed a few pips below the low of the range for bullish trades or a few pips above the high for bearish trades to accommodate market noise and volatility. Take Profit Profit targets are commonly set based on a risk/reward ratio that aligns with the trader's overall strategy. These targets may also be adjusted depending on subsequent support or resistance levels. The Bottom Line The ORB strategy offers traders a robust framework for capturing significant price movements in both stock and forex markets. Whether opting for the traditional breakout method or the more cautious pullback strategy, understanding the nuances of each market can enhance the ORB's effectiveness. Interested in deploying this strategy? Consider opening an FXOpen account to access a wide selection of markets, rapid execution speeds, and competitive trading costs. Good luck! This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.
Education
by FXOpen
1
Trade Like a Sniper - Episode 4 - XAGUSD - (10th May 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 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 XAGUSD, starting from the Monthly chart. - R2F
FOREXCOM:XAGUSDEducation
by Road_2_Funded
EURUSD Short trade entry explanation and trading planIn this video, I want to explain to you why I'm entering the shorts based on my previous analysis. Focus on the FVG and IFVG and liquidity. Don't hesitate to contact me for help I'm always open to answering and clearing the doubts. Initial idea Always follow these rules - Accumulation / Manipulation / Distribution - No liquidity raid = No trade - Never buy high and never sell low “Adapt what is useful, reject what is useless, and add what is specifically your own.” Dave FX Hunter ⚔
Education
by Dave-Hunter
HOPE TRADING: This is how you lose big money in tradingHope Trading: How Traders Lose Money in Trading This image shows how traders lose their money in trading due to hope. Hope is good but also you should believe in your analysis if your SL hits then accept that you are wrong now and should not hope in the wrong direction. In the world of trading, hope can be both a friend and a foe. While optimism is essential, relying solely on hope can lead to significant losses. Let's explore why: 1. The Power of Hope: - Hope keeps traders motivated and optimistic. - It encourages persistence during challenging times. - However, hope alone is not a winning strategy. 2. The Danger of Blind Hope: - Traders often cling to hope even when their analysis suggests otherwise. - Ignoring stop-loss (SL) levels due to hope can be disastrous. - Hope can blind us to market realities. 3. Balancing Hope and Analysis: - Believe in your analysis, but remain open to adjusting your strategy. - If your SL is hit, accept that you were wrong and cut your losses. - Avoid hoping for a miraculous turnaround. 4. Risk Management: - Set clear risk limits and stick to them. - Use SL orders to protect your capital. - Hope should never override risk management rules. Remember, hope is valuable, but it must be grounded in sound analysis and risk management. Thanks Happy Trading
NSE:RELIANCEEducation
by Shaiv_Market
A Winning Trade ExplainedIn the video I explain my approach to the market and how I use 'trade sizing' to manage my risk in the initial part of the US session. I walk through the price action for the NASDAQ and why I traded short and then flipped long. I explain the concept of sizing with regards to trade management and then how I 'SIZE UP' when I have conviction to end with a profitable session. ** If you like the content then take a look at the profile to get more ideas and learning material ** ** Any Comments and likes are greatly appreciated **
CME_MINI:NQ1!Education
by TradeTheStructure
1
Using Fibonacci & FPT To Identify Trends/Entries/ReversalsLearn how powerful Fibonacci Retracements and Fibonacci Price Theory are when adequately deployed. It can tell where and when to target entries, trends, risks, and reversals. Anyone can do this when they learn to efficiently manage the ranges and use Fibonacci tools in Trading View. It's time you took a few minutes to learn the PRICE is the ultimate indicator. You don't need to use dozens of other indicators (unless you want to add to the core Fibonacci techniques). Watch this video, then follow my research/videos.
DJ:DJIEducation
by BradMatheny
✨Unlock Market Mastery: How Wyckoff Theory Made Me a fortune! The Wyckoff Model is a trading approach based on several key principles: 1. Law of Supply and Demand: Prices move based on the balance between supply (sellers) and demand (buyers). 2. Law of Cause and Effect: The market goes through phases of accumulation (building up) and distribution (selling off), leading to subsequent mark-up (price increase) and mark-down (price decrease) phases. 3. Law of Effort and Result: The relationship between the effort (volume) put into the market and the resulting price movement. 4. Accumulation and Distribution: Recognizing patterns where large players accumulate or distribute assets. 5. Analysis of Price, Volume, and Time: Understanding market movements by analyzing these three factors together. While the Wyckoff Model provides valuable insights, it's important to note that it rarely appears perfect and is often overlooked by many traders. However, experienced traders can spot its patterns across various markets. Higher volume and liquidity markets tend to offer better opportunities. In my years of trading Bitcoin, I've refined the Wyckoff Model into what I call the Trinity Model, which has been instrumental in many of my successful trades. Follow and boost for more insights! 📈✨🚀
Education
by Trade-Journal
Trading EURUSD | Judas Swing Strategy 07/05/2024At 8:35 AM EST, EURUSD initiated a liquidity grab above the 00:00 - 8:30AM EST Zone with a Bullish Marubozu candle. This move could potentially trap breakout traders, as it appears to signal an upward move, only for the price to swiftly reverse course. To avoid getting trapped, we waited for price to create a Break of Structure (BOS) to the opposite side (sell side) to indicate price wanted to sell. Subsequently, our focus shifted to identifying the initial Fair Value Gap within the displacement leg that broke structure. Our preferred entry strategy involves patiently awaiting price retracement into or touching the Fair Value Gap (FVG), with execution of the trade occurring upon the close of the first candle entering or touching the FVG. This approach was not arbitrary, rather, it emerged as the result of thorough backtesting of numerous entry techniques. We have found it consistently provides better entry points and occasionally prevents us from taking trades that might otherwise trigger a stop loss within the same entry candle. Following our trade's execution, we endured a brief drawdown of about 20 minutes. We were undeterred by this temporary setback because we had a prudent risk management approach in place, we had allocated only 1% of our capital to this trade, while eyeing a potential 2% gain. We maintained confidence in our strategy, given its extensive backtesting, which has demonstrated a win rate of 52.78% on EURUSD. While our data typically indicates an average trade duration of 8 hours and 27 minutes, our target was achieved in 2 hours and 15 minutes, securing a 2% gain on the trade where we had risked 1%
Education
by CleoFinance
TrendsThe trend represents the directional movement of prices and plays an essential role in most technical trading systems. Technical analysis differentiates between trending and non-trending markets, also called flat trending markets. Trending markets can be either moving upwards or downwards. The upward-moving market is called the bull market, while the downward-moving market is called the bear market. Normally, a market is considered to be in an uptrend when the price reaches higher peaks and higher troughs. On the contrary, the market is regarded to be in a downtrend when the price reaches lower troughs and lower peaks. The non-trending market occurs when there is no significant uptrend or downtrend, and the price moves within a certain range. Thus, the flat trending market is notorious for its sideways-moving price action. Key takeaways: Trends can vary in length and are classified into four main categories: primary, secondary, minor, and intraday. The primary trend is the most significant trend, lasting for months or years. It's characterized by the overall direction of the market. The secondary trend opposes the primary trend and usually lasts for weeks or months. Identifying trends is crucial for technical traders. Methods range from simple tracking of recent lows and highs to more complex mathematical formulas. Trend classification Trends tend to be of different lengths. According to these lengths, trends fall into four main categories: primary trend, secondary trend, minor trend, and intraday trend. The primary trend is the only inviolable trend and lasts for a long period, usually months or years. The secondary trend runs counter to the primary trend and is often measured in weeks or months. Further, the minor trend is measured in days, and the intraday trend is represented merely by daily fluctuations in price. The primary trend The primary trend can be subdivided into three distinctive phases. The first phase of the primary uptrend begins with the revival of investors' confidence from the prior primary downtrend. That is followed by the second phase, in which asset prices increase in response to growing corporate earnings. In the third stage, speculation becomes the dominant force driving markets higher. This environment, when asset prices are rising on the hopes, dreams, and expectations of individual investors, tends to foreshadow the beginning of the primary downtrend. Its first phase commences with the abandonment of hopes and dreams upon which investments were made. That is followed by selling pressure due to falling corporate earnings in the second phase, which later escalates into panic selling in the third stage. Illustration 1.01   The illustration displays the weekly chart of Nasdaq continuous futures (NQ1!) for the period between late 2001 and 2008. The primary bull market began after the bottom of the “dotcom” bubble and lasted until the peak of the real estate and credit crisis in 2007. Illustration 1.02   The image above presents the daily chart of gold (XAUUSD) during the 2008 bear market when it dropped 34%. The secondary trend The secondary trend is the intermediate-term trend. Its direction is opposite to the primary trend, and it represents any significant price drop in the primary bull market or price rise in the primary bear market. The secondary trend usually lasts for weeks or months. Its measure in percentage terms tends to range between 33% and 66% of the range of the primary trend. This trend is considered to be prone to market manipulation as opposed to the primary trend. Illustration 1.03   The picture shows Bayerische Motoren Werke's (BMW) daily chart throughout 2020 and 2021. The white dashed-line box indicates the primary uptrend, and the grey dashed-line boxes indicate the secondary trends, counter to the primary one.  The minor and intraday trend The minor trend lasts for a few days or weeks, yet always less than the secondary trend. It is more difficult to identify than previous types of trends since its amplitude in percentage terms is significantly less when compared to the primary and secondary trends. The same applies to the intraday trend that lasts for a few seconds up to several hours; it represents daily changes in the price and is regarded to have little predictive value. Trend identification Identifying a trend is crucial for a trend-based technical trader, and there are plenty of methods how to identify it correctly. These methods can be simple or very complex. The simplest method of identifying trends can be done by tracking recent lows and recent highs in the price of an asset. Other simple methods involve using lines, trendlines, and curves; more complex methods usually involve the use of mathematical formulas in order to generate a set of valuable data. Please feel free to express your ideas and thoughts in the comment section. DISCLAIMER: This article is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not be a basis for taking any trade action by an individual investor or any other entity. Therefore, your own due diligence is highly advised before entering a trade.
Education
by Tradersweekly
2
investing is better than tradingIn this video, I highlight how to use an investor's approach in the financial markets in two ways. The first way is through what I call the "Thomas Wood" Way of entering positions that side with the market trend after price breaks out of a correction that suggests continuation of the trend. The second way is the way I learnt to see the market movement between buyers and sellers, demand and supply - also following the trend of the market. Trading every move that the markets present to you is deadly as it can lead to confusion, losses and tiring your self mentally and emotionally, whereas only looking for opportunities that show or suggest that the market is continuing its original flow is easier and results in more progress. A word of caution though, is that you have to be patient when using this approach (P2+BU) as it does take time to go into effect.
Education
by Madsan88
The TradingView Show: Live With OKX & TradeTravelChillGreetings, TradingViewers worldwide! This interview was conducted live and is now available for playback and on-demand viewing on our TradingView account, accessible for free. This program delves into trader education, cryptocurrencies, and the flexibility of trading from anywhere with an Internet connection. Keep in mind that this show was streamed LIVE, so you might come across references to our live chat. No worries, though; you can still watch the show instantly and access the comments section below. Feel free to leave us your feedback! Here's a glimpse of what we cover in this episode: 1. Gain insights into crypto trading, specific strategies, and the essence of trading them. 2. Understand the dynamics of trading on-the-go and establishing personal rules in an era where crypto trades round-the-clock and connectivity is constant. 3. Discover how TradeTravelChill began on TradingView and OKX, now leveraging our integrated broker partnership. TradeTravelChill and OKX are partners, with OKX being a broker partner on our platform, facilitating seamless connections for traders. 4. Dive into trade ideas and setups in crypto markets, particularly focusing on major coins. 5. Explore some of the hottest topics in crypto markets at the moment. Our objective with this show is to educate traders worldwide! While we don't provide direct advice, our focus is on empowering traders to learn, practice, and excel in the markets. Relax, ask questions, and enjoy the show!
Editors' picks
Education
by TradingView
11
IS IT A GOOD TIME TO BUY STOCKS? In order to assess whether it is a good time to increase exposure to riskier assets such as equities, institutional traders often use correlation tools and inter-market analysis. Depending on the macro environment (uncertainties, market drivers, monetary narratives), traders periodically assess their exposure between offensive and defensive values (Risk-on vs Risk-off). One of the easiest way to assess investors' trading stance and appetite for risk is to look at what is happening on other asset classes such as Bonds and currencies. For instance, on this example you can find the US 10 year yield (bond) on the right, the US Dollar index in the middle (currency) and the S&P500 (stocks) on the right. It is easy to notice the mechanism in place here : When the currency becomes weaker while the cash goes back into bonds (bear in mind that when bond yields drop means bond markets goes up), it usually sparks a bullish trend in the stock markets. This is exactly what we are seeing here. Bond yields have started to drop on the 1st of May, alongside the Dollar index, which sparked a sharp rebound on the S&P500 at the same time. Of course, sometime these three asset classes aren't correlated that much, which means there is no clear trading signal and that uncertainty lingers in the markets. But when a drop occurs in both bond yields and the currency of a specific economic zone, this is seen as the best setup to buy stocks for traders. This is explained by the fact that when the currency drops, large exporting groups are able to sell more internationally, boosting their exports. Meanwhile, a drop in bond yields means investors are willing to put more cash into the market. If you're willing to know whether it is a good time to increase your exposure to equity markets, maybe you should pay attention to what's happening in those key other assets. Pierre Veyret, Technical Analyst at ActivTrades. The information provided does not constitute investment research. The material has no been prepared in accordance with the legal requirements designed to promote the independence of investment research and such is to be considered to be a marketing communication. All information has been prepared by ActivTrades ("AT"). The information does not contain a record of AT's prices, or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information. Any material provided does not have regard to the specific investment objective and financial situation of any person who may receive it. Past performance is not reliable indicator of future performance. AT provides an execution-only service. Consequently, any person acing on the information provided does so at their own risk.
UEducation
by ActivTrades
Hunting for Trend Days Part 3: Case Studies and PsychologyWelcome to the final instalment of our series on hunting for trend days. In Part 1, we covered the fundamental characteristics of trend days and essential tools for identifying them early. Part 2 delved into advanced strategies for maximising opportunities and effectively managing trades during trend days. Now, let's explore case studies of successful trend day trades and delve into the psychology behind trading trend days. Case Studies: Here are some real-world examples of how trades can be taken and managed on trend days using the techniques covered in Part 1 and Part 2. Each example will be viewed through the prism of the three C’s – Context, Catalyst, and Consistency . Context refers to conducting higher timeframe analysis on the daily candle chart. Catalyst refers to the confluence of evidence that a trend day is taking place. And Consistency refers to how we consistently select and manage trend day trades on the 5min candle chart. Case Study 1: EUR/USD Context: The higher timeframe daily candle chart provides valuable context for the impending trend day. We can clearly see that daily trading ranges have been contracting for several consecutive days. This puts day traders on high alert for an expansive range day in either direction. 15th Jan 2024: EUR/USD Daily Candle Chart Past performance is not a reliable indicator of future results Catalyst: The following day, at the start of European trading, EUR/USD has already broken and held below the prior days low (PDL). EUR/USD has also broke below the daily compression pattern (highlighted above) and the market is holding below a downward sloping volume weighted average VWAP. This is enough confluence of evidence that a trend day is taking place and traders can start to position themselves accordingly. 16th Jan 2024: EUR/USD 5min Candle Chart Past performance is not a reliable indicator of future results Consistency: Entering managing trades on trend days should not be over complicated, the most important aspect is consistency of method and approach. A simple trend following day trading entry and exit technique can be employed on trend days: Entry: Break below swing support and 9 period EMA Exit: Break and close above 9 period EMA. (Blue arrows = Entry, Red arrows = Exit) 16th Jan 2024: EUR/USD 5min Candle Chart Past performance is not a reliable indicator of future results Case Study 2: Apple (AAPL) Context: Again, the higher timeframe context is key. As Apple’s share price approached a key level of long-term support the daily ranges started to contract and the market started to consolidate within a falling wedge pattern. This puts day traders on high alert for an expansive range day in either direction. 10th APR 2024: AAPL Daily Candle Chart Past performance is not a reliable indicator of future results Catalyst: Prior to the trend day developing there were several early warning signs within the first hour of trading. Having gapped slightly higher at the open, the shares broke and held above the PDH. Price was also holding above an upward sloping VWAP and breaking above the falling wedge consolidation pattern that formed on the daily candle chart. 11th APR 2024: AAPL 5min Candle Chart Past performance is not a reliable indicator of future results Consistency: Again, a simple trend following day trading entry and exit technique proves effective. Entry: Break below swing support and 9 period EMA Exit: Break and close above 9 period EMA. (Blue arrows = Entry, Red arrows = Exit) 11th APR 2024: AAPL 5min Candle Chart Past performance is not a reliable indicator of future results Psychological Insights: 1. Patience and Discipline: Successful trading during trend days requires patience and discipline. It's essential to wait for confirmation of the trend and avoid impulsive decisions based on emotions or fear of missing out (FOMO). Stick to your trading plan and only take high-probability setups that align with your strategy. 2. Flexibility and Adaptability: While it's crucial to have a trading plan, it's also essential to remain flexible and adapt to changing market conditions during trend days. Be willing to adjust your strategy based on evolving price action and market dynamics, and don't hesitate to cut losses when necessary. 3. Emotional Control: Managing emotions such as greed, fear, and overconfidence is critical for successful trading during trend days. Avoid letting emotions dictate your trading decisions and maintain a rational and objective mindset at all times. Remember that losses are part of trading, and it's essential to stay focused on long-term profitability. Conclusion: Pursuing trend days can present both opportunities and challenges for day traders. While traders may benefit from consistent trending price movements, it's crucial to identify trend days early, apply effective trading strategies, and maintain psychological discipline to navigate the potential risks successfully. We hope this series has provided valuable insights and practical techniques for navigating trend days with confidence and competence. Remember to continuously refine your skills, adapt to changing market conditions, and always prioritise risk management. Happy trading, and may the trend days be ever in your favour! 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. 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NASDAQ:AAPLEducation
by Capitalcom
DCA - is for those who do not like to be nervousIn the fast-paced and often volatile world of cryptocurrency, finding best investment strategy can be a daunting task. While many traders seek quick gains through active trading, a more prudent and less stressful approach exists: Dollar-Cost Averaging (DCA). What is DCA? DCA is an investment strategy that involves investing a fixed amount of money into a particular asset at regular intervals, regardless of the asset's price. This approach aims to reduce the impact of market volatility on investment returns by averaging out the purchase price over time. Why is DCA the Sleep-Well Strategy? DCA offers several advantages that make it an ideal strategy for investors seeking long-term growth and peace of mind: Emotional Discipline: DCA eliminates the emotional decision-making that often plagues traders. By investing consistently, regardless of price fluctuations, you avoid the urge to buy high and sell low. Reduced Risk: DCA averages out the purchase price, reducing the overall impact of market volatility. You may buy some coins at higher prices, but you'll also benefit from lower prices, evening out your investment cost. Long-Term Focus: DCA encourages a long-term investment mindset, discouraging impulsive decisions based on short-term price movements. It's about building wealth gradually and consistently over time. DCA vs. Trading: DCA stands in stark contrast to active trading, which involves buying and selling assets frequently to capitalize on short-term price movements. While active trading may appeal to experienced traders with high-risk tolerance, it often leads to emotional decision-making and can be time-consuming and stressful. DCA: A Proven Strategy with Remarkable Returns To illustrate the effectiveness of DCA, let's examine the returns of some prominent cryptocurrencies over the past few years, assuming a monthly DCA investment of $100: Bitcoin (BTC): Investing $100 monthly in BTC since January 2019 would have yielded a staggering 112% return, with a total investment of $12,000 growing to $25,440. Ethereum (ETH): A DCA approach for ETH since January 2019 would have resulted in an impressive 770% return. Solana (SOL): DCA into SOL since January 2021 would have generated a remarkable 304% return Fetch.ai (FET): Investing $100 monthly in FET since January 2019 would have yielded an exceptional 776% return Understanding the Coins: Technology and Applications Bitcoin (BTC): The world's first and most popular cryptocurrency, Bitcoin is a decentralized digital currency that enables peer-to-peer transactions without intermediaries. Ethereum (ETH): A decentralized blockchain platform, Ethereum supports a wide range of applications, including smart contracts, decentralized finance (DeFi), and non-fungible tokens (NFTs). Solana (SOL): A high-performance blockchain known for its scalability and speed, Solana aims to provide a faster and more efficient alternative to Ethereum. Fetch.ai (FET): An AI-powered decentralized platform, Fetch.ai facilitates the development of autonomous agents for various applications, including open marketplaces and data monetization. Conclusion: DCA is a powerful investment strategy that allows individuals to build wealth in cryptocurrency while minimizing risk and emotional stress. By consistently investing fixed amounts, regardless of market fluctuations, DCA investors can reap significant rewards over the long term. Embrace DCA, sleep well, and let your investments grow steadily towards a brighter financial future.
Education
by Yaroslav_Krasko
What Is a Gap and How Can You Trade It in Forex and Crypto?What Is a Gap and How Can You Trade It in Forex and Cryptocurrencies? When it comes to trading, understanding gaps is pivotal for traders aiming to navigate and capitalise on market volatility. These spaces on price charts where no trading occurs are often exploited by traders looking for a quick reversal or trend continuation. This article delves into the essence of gaps, their types, and three gap trading strategies. Understanding Gaps in Trading Understanding gaps in trading is crucial for both new and advanced traders, as these occurrences can signal significant price movements and opportunities. A gap is observed on a price chart when the price of an asset sharply moves up or down with no trading in between, creating a visible space or 'gap' in the price pattern. They almost always happen at the market open but can also occur after major news events or economic announcements, reflecting a sudden change in sentiment. There are four main types of gaps, each offering different insights and implications for traders: Exhaustion These appear at the end of a price movement and signal that a trend may be running out of momentum, potentially leading to a reversal. This type is characterised by a sudden move in the price in the direction of the prevailing trend, but with the trend quickly losing strength and often reversing after the gap is made. Breakaway Occurring after a period of consolidation, breakaway gaps signify the start of a new trend. They emerge when the price moves away from a trading range or pattern, indicating a significant change in market dynamics and the potential for a sustained move in the direction of the price jump. Continuation These gaps are seen within a strong trend and signal that the current trend is likely to continue. Continuation gaps represent a surge in interest in the direction of the prevailing trend, reinforcing the current momentum and suggesting further movement in the same direction. Common These are the least significant and occur frequently without implying any particular price direction. Common gaps are typically filled quickly and can be a result of minor fluctuations that temporarily create a small jump in the price pattern. The Significance of Gaps in Forex and Cryptocurrency Markets In the world of trading, the occurrence of gaps on price charts holds particular significance, offering insights into market sentiment and potential shifts in price dynamics. This is especially true in the forex and cryptocurrency markets, where they convey unique implications due to the nature of these markets. In forex, gaps are relatively rare compared to stock markets, primarily because forex is traded 24 hours a day, five days a week. However, this unique feature is what makes the gaps important for identifying price movements. Usually, they occur at the beginning of the trading week or after major geopolitical events and economic announcements that happen over the weekend. They’re closely watched by traders as they can indicate a strong initial reaction to news or events, potentially setting the tone for trading in the coming days. Cryptocurrencies, traded continuously 24/7, experience gaps even less frequently than forex. The non-stop nature of this market means that price action is constant, leaving little room for price jumps to form on price charts. However, when they do appear in cryptocurrency markets, often on derivatives charts rather than spot, it can signal extremely impactful events or significant shifts in trader sentiment. Given their rarity, gaps in cryptocurrencies are particularly noteworthy and can represent critical trading opportunities or warnings for investors. In both scenarios, the gap is likely to be filled at some point. Often, this occurs on the same day or within a few days of its appearance. However, a gap can remain unfilled for several weeks or months, depending on the market context. It’s worth determining the type of gap you’re looking at to gauge whether the price will reverse quickly or kickstart a new trend. Three Gap Trading Strategies Now, let’s take a closer look at three gap trading strategies that can be used in the forex and crypto markets. Want to follow along? Using FXOpen’s free TickTrader platform offers access to live forex and crypto charts. Gap and Go Trading Strategy The Gap and Go trading strategy is a popular gap trading technique that emphasises the power of momentum following a sudden market jump. This approach is particularly effective in capturing the initial movement after a gap appears, usually at the opening of the trading week in forex. The strategy focuses on identifying strong momentum indicated by breakaway or continuation gaps on daily or weekly charts. However, it can also serve as a valuable tool for setting short-term direction on lower timeframes. By aligning trades with this initial burst of momentum, traders can potentially capitalise on swift movements before the price settles. Entry Traders typically look for a jump that occurs in the direction of the prevailing trend. Entry is often considered as soon as the candle opens after the gap. Stop Loss Stop losses are commonly placed just above (for short positions) or below (for long positions) the high or low of the previous candle's trading range. Take Profit Profit targets might be set at a nearby support (for short positions) or resistance level (for long positions) on the same timeframe as the entry, allowing traders to lock in returns before the market potentially reverses or consolidates. Quick Reversal Gap Trading Strategy This strategy focuses on exploiting the tendency of gaps that go against an established trend to get filled quickly. They are typically interpreted as common gaps, which arise due to an overstated response to overnight news or weekend events. Unlike exhaustion gaps that signal the start of a new trend, this type usually represents temporary deviations from a prevailing trend, leading to quick reversals as the market reassesses and corrects the initial knee-jerk reaction. This filling process is attributed to the market's natural inclination to maintain a trend unless given a strong reason to reverse. Entry Traders identify an existing trend using a daily or weekly chart. For a bullish trend, the strategy involves looking for a candle opening price that is lower than the previous close (and the opposite for a bearish trend). The entry point may be set when this counter-trend gap is identified. Stop Loss A stop loss may be placed just beyond a nearby swing point. Take Profit Profit targets may be established at the close of the candle before the gap, where the jump is expected to be filled. Small Gap Fill Trading Strategy When trading gaps in forex, it’s common to see small gaps being filled within a short period, often within a day or two. This strategy is tailored to identify spaces that are relatively minor, typically less than half of the previous day's trading range. While strategies that align with momentum and trends may have a higher probability of an effective trade, the market's inherent desire to seek equilibrium makes even small, seemingly insignificant gaps likely to be filled. Entry Traders look for a small price jump, ideally less than half the size of the prior day’s range, entering in the direction anticipated to fill the gap. Stop Loss A stop loss may be placed slightly above (for short positions) or below (for long positions) the day's open, allowing for some intraday price movement. Take Profit Profits may be taken as soon as the close of the candle preceding the gap is met, capitalising on the quick return to balance. While this strategy may carry higher risk due to its simplicity and lack of supporting factors (like trend analysis), its effectiveness can potentially be enhanced by using other forms of analysis. For instance, if the gap occurs near a support or resistance level, the likelihood of the gap filling may increase. The Bottom Line Understanding and trading gaps in the forex and cryptocurrency markets may offer unique opportunities for informed traders. However, it may be worth combining these strategies with a solid understanding of market conditions and technical analysis to enhance their effectiveness. For those looking to apply these strategies and more, opening an FXOpen account could be the next step towards engaging with forex and cryptocurrency markets via CFDs. FAQs What Is a Gap in Trading? A gap in trading refers to a significant price movement on a chart where no trading occurs, leaving an empty space between two trading periods. This jump, either up or down, is often influenced by news events or market announcements. How to Predict a Gap Up or Gap Down? Predicting a gap up or down involves analysing market sentiment, news events, and technical indicators that might influence the opening price of an asset, usually over a weekend or when the market is closed. Traders closely watch for indicators of sudden shifts in demand or supply that could lead to a price jump. What Is the Forex Gap Strategy? The forex gap strategy leverages markets' tendency to fill gaps after they occur. Traders identify potential price jumps over the weekend or after major news releases and position themselves to capitalise on the price movement back to the pre-gap level. How to Trade Gaps? Trading gaps involves identifying the type of gap and employing a strategy suited to its characteristics. Traders might enter trades in the direction of the gap's fill or anticipate a continuation of the trend that caused the jump. What Are the Four Types of Gaps in Trading? The four types of gaps in trading are Breakaway, Exhaustion, Continuation, and Common. Each type indicates different market conditions and potential future price movements, guiding traders on how to position their trades. 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
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