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USD (US Dollar)

Best intruments to short term trade: Looking at the spreads.Howdi fearless gamblers. Today/Tonight/Yesterday I want to post about spreads. I have spend some time calculating them, so I thought, why not share? It does not cost me anything and it has value to you. In what is best to short term trade, this is what you must look at (correct me if I am wrong): - The volatility: if it does not move you are not going to get anything out of it. - When are we open? Does it fit your time schedule? - Your personal preference. - The spreads: if you aim for 1% moves and 0.3% is going to the broker, you won't get very far... Of course, this is not very important for anyone holding trades over periods of several days or weeks. So this is what I have: Currencies All calculated with FXCM, it is around the same everywhere (decent). *** USD pairs *** --- Tier 1 --- EURUSD => 0,010% USDJPY => 0,010% GBPUSD => 0,011% --- Tier 2 --- USDCAD => 0,017% USDCHF => 0,017% USDMXN => 0,017% --- Tier 3 --- AUDUSD => 0,023% --- Tier no thank you --- NZDUSD => 0,027% USDSEK => 0,031% --- God Tier --- USDCNH => < 0,0075% *** Cross pairs *** --- Tier 2 --- EURJPY => 0,016% GBPJPY => 0,018% EURCAD => 0,018% EURNZD => 0,020% EURAUD => 0,015% EURCHF => 0,019% --- Tier 3 --- GBPAUD => 0,022% GBPCAD => 0,022% --- Tier no thank you --- AUDCAD => 0,027% GBPNZD => 0,025% EURGBP => 0,024% AUDJPY => 0,026% AUDNZD => 0,032% CHFJPY => 0,022% GBPCHF => 0,027% --- Tier lol dis a joke man? --- NZDCAD => > 0,045% The Forex moves I look at that happen in a few hours to maybe 2 days are 0.30% 0.50% 0.75% 1%. A spread of 0.03% is 10% of that 0.30% move. Futures --- Tier 1 --- Gold => 0,03% Moves twice as much as FX --- Tier 2 --- Copper => 0,11% Moves 3 times as much as gold, 6 times FX. Oil => 0,07% Moves a little more than gold I think? Maybe 1,5-twice as much. --- Tier lol dis a joke man? --- Silver => 0,30% TOO DAMN HIGH NatGas => 0,33% Moves alot, but still too high. Cryptocurrencies The volatility at the time is non existant for crypto but it will change so I am looking at it anyway, for the day this changes (I get spammed with alerts every day for FX and see moves over and over and over, crypto? Something I might see 30 times a month with FX I might see once a time with crypto. Just look at the charts.) So usually the commissions are the same for all, on Binance without BNB it is 0.1%. Crypto moves are 3% 5% 7.5% 10% etc (with bigger risk thought). On Kraken it is going to be more or less the same as Binance, it depends on your volume. On Bittrex Polo etc it is higher (unless it changed). If you are taker you got higher fees + a little spread. So if it moves 10 times as much as FX (when it moves I mean), you dive 1% by 10, BUT remember you will pay it twice (go long and take profit). So 0.2% / 10 = 0.02% Which places Crypto between Tier 2 and Tier 3. Same as a GBP pair or Copper. Copper moves as much as Bitcoin too or almost as. Pretty much you can trade either and have the same experience minus the sideways and armies of bagholders telling you what a fool you are for not accumulating with Copper. Indices I do not have the values with me but alot are super low, with DAX the lowest and NASDAQ second, maybe the euro thing too. The big indices are tier 1. UK and French ones I think are tier 1 too. The surprise for alot of people would be that Dollar vs Yuan is the one with the lowest spread. Every one is talking about how many pounds per pip and how many pips they take because they are obssessed with how much money they will make and really bad at math. That is not what matters. What matters is USDCNH has the lowest spread and is the most profitable thing to trade in the whole universe if everything else is equal. * It depends WHEN you look at USDCNH thought... At the time, I am fully focussed on trading FX perfectly before I move back to anything else. I only trade the tier 1 to 3 as well of course, as the mighty USDYUAN. So this is my watchlist and what I am trading at the moment, 16 of them: FX:EURUSD,FX:USDJPY,FX:AUDUSD,FX:USDCAD,FX:GBPUSD,FX:USDCHF,FX:USDMXN,FX:USDCNH,FX:EURJPY,FX:GBPJPY,FX:EURCAD,FX:GBPAUD,FX:GBPCAD,FX:EURNZD,FX:EURAUD,FX:EURCHF I really want to trade gold and copper again, but for now I am focussed on perfecting a new strategy (I already had one before but I wanted to master a new one... I cannot help it I am too competitive...). Then I will add Futures again, and then go look at crypto, which might have stopped being unbearably pointless by then. I think we get a mighty dump in the next weeks, but that will not mean the volatility is back, just a mighty dump a sharp bounce, and then back to boredom for months or even years. I am not interested in looking at stocks. Open a few hours a day with only the first and last hours being worth spending time on? Haha no than you! I would rather do macro economics and trade indices. I cannot be bothered with the latest FOMO news and this mighty stock that will make idiots millionaires GUARENTEED.
Education
by MrRenev
1
Defining the Carry TradeSuppose that the deposit interest rate in the US stands at 1.5% and the interest rate in Europe stands at 0%. Let's also assume that the EURUSD rate is at 1.10 and that we do not expect it to move in the next year. Investors, aware of this situation would be willing to borrow from Europe deposit in the US, benefiting from the interest rate differential, and ensure a 1.5% risk-free return. This investment, where money is "carried" to another location (physically until mid-20th century), is called the carry trade. While the carry trade appears to be very simple, many dangers lie in its application. Remember that our second and most crucial assumption was that the exchange rate would not move. Nonetheless, exchange rates seldom remain stable. In fact, the inflow of capital - deposits in our example - is what actually makes the exchange rate move. This is why, in an earlier post , we have already specified that a change in interest rates can be suggestive of the future movement of the exchange rate. In order for the trade to be successful, the EURUSD rate must not depreciate to an extent after which profits will be eaten out. Suppose that an investor wishes to borrow EUR1 mln and carry it to the US. Thus, he would be depositing USD1.1 mln in the US with hopes of getting back USD 1.1165 mln one year from now. If the exchange rate remains at 1.10, then the investor would transform the money to EUR1.015, repay the loan and enjoy a EUR15,000 profit. Nonetheless, if the exchange rate moves to 1.11, then the investor's profit is reduced to just EUR 5,000 after the loan is repaid. As you can imagine, the Dollar profit turns into a Euro loss if the exchange rate moves to 1.12. As you may have guessed, in order for the trade to be profitable, the exchange rate should not move by more than the exchange rate differential, which is not what the Inverse Fisher effect suggests. As such, for the carry trade to be successful, there needs to be substantial room for error. As such, a large interest rate differential is required. Further to this, traders need to find a currency pair in which the currency with the highest interest rate is not expected to depreciate by much. Is the carry trade an easy trade to find? Of course not. But it is possible. In 2016, the Russian interest rate stood at 11%, while the respective interest rate in the US stood at 0.5% and remained at that point until December . This would imply an interest rate differential of approximately 10.5% for the year. The USDRUB exchange rate stood at 72.91 on January 4, 2016 and ended up at 60.68 on December 29, 2016. Suppose now that an investor borrowed USD 1 mln, exchanged it for RUB 72.91 mln and invested it in Russia. By the end of the year, the investor would have gained 11% on his RUB investment, at a value of RUB 80.93 mln. Exchanging it back to USD at the 60.68 rate would mean that the trade would have ended with a value of USD 1.334 mln, which after deducting the USD 1.005 mln, would leave the trader with approximately USD 330,000, or a 33% return on investment. Hence, while carry trade opportunities are rare, they can be present if good and careful research is made. However, it should be remembered that carry trades are high-risk strategies and thus proper risk management strategies should be used. Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
Education
by HotForex
EAGLE Strategy - $USDTRY: Keeping A Close Watch On E.A.G.L.E.:2018-08-10 - $USDTRY: Keeping A Close Watch On E.A.G.L.E.: Traders, Can you count how many times we got burnt on $USDTRY, waiting for a movement that occurred in multiples of the expected forecast, or one that simply turned around? I can: Two too many. In this case, I want to highlight a few areas that are worth looking as we wait for a probable reversal at the highlight range, namely: 1 - 6.7302 AND 2 - 6.6694 This range is referred to as a strong Bearish Entrenchment, in which reversal are expected to occur IF and ONLY IF price is meant to reverse at this level (per data determined by CROW Code). Here, the assumption is that a reversal is afoot, so we want to test this sensitive area, which will act as a lithmus test for me, you and anyone getting in the habit of using this method. First, this area is determined as a narrow band at approximately the top 4th of the high-to-most-recent bottom. Estimate a 4th of that height, and draw a narrow band above and below this estimated level. Second, for this level to be valid and raise suspicion of a reversal therein, wait for price to rally and stomp within the range. This is the time when I like to enter an aggressive counter-trend position. Here, the trend is UP, so I would simply enter a FULL SHORT Trade Opp position. Why FULL? Simply because this would represent the smallest exposure I would EVER get in such a short trade opportunity were price to move adversely and hit the SL, defined as the highest-high attained by price in the frame. $USDTRY/M15: COMPONENTS OF A DESCENT: The targets that I derive out of the CROW Code are typically associated with foreseeable price behavior. This is not the case all the time, but most of the time. TG-1 & TG-2 - The Last Bullish Entrenchment: For instance, targets TG-1 and TG-2 are most often associated with a significant pushback, so much so that some traders familiar with TG-1 and TG-2 will often chose to take profit upon validation of TG-1 when no pushback occurred at TG-1, then wait for a break below TG-2 for re-entry towards the other targets. TG-3, 4, 5 - The Pass-Throughs: By contrast, TG-3, 4 and 5 are pass-through targets, where some price behavior may occur, but at much less the frequency than what is seen with the first two targets. For instance, TG-4 would at time be associated with a deeper push-back than would occur at TG-5, but as long as the pushback remains less than 0.384-Fib deep from the prior leg, then there is no reason to expect that an aggressive, early reversal is afoot ... Stay a while longer for TG-5. The Ultimate Target, TG-u - Risk of Reversal: Most recently, I came up with an "ultimate target", which is the level most often associated with a reversal, or at least a deep retracement, which I would define as deeper than 0.618-Fib of the entire move down. That level is one that is the most difficult to trade, simply because once all numerical targets (TG-1, 2, 3, 4, 5) have been hit, there is a sense that price could no longer go any further. This is especially true when a 5-wave count ends at or near TG-5. However, I have been surprised most often than not with this target, and a retrospective wave count would often reveal that, although TG-5 may have corresponded to the terminal level of a 5th wave, concluding an impulse wave, a Flat would throw its wave-B and surpass that last level. Another observation also shows that while the impulse concluded at a 5th wave, it was only defining wave-A of a larger and yet to complete Elliott Wave Zig-Zag (ZZ), in which wave-C would push a bit further and justify TG-u. In any case, TG-u is where the grit of trading is found, as it takes nerves of steel to stay the course, or much more as I do, I simply set-and-forget. As an aside, I have chosen PURPLE as the color of TG-u, as it is the bruising and nose-bleeding that it imparts psychologically during deep decline or advances, respectively. NOW, WHAT TO DO: Using the steps that I will define below, simply get into the habit of checking whether price will move in your forecast direction. The simplest method would be to define a TOP and a BOTTOM, where TOP is the highest high achieved by price, whereas the BOTTOM is the presumed temporary base formed by the recent decline in the chart. Finally, ENTER SHORT upon breach of BOTTOM. This would often be a conservative entry, compared to an aggressive entry define by E.A.G.L.E. If instead, price breaks above SL, then you would get out with a solid rational and very little loss, using an objective strategy that you can now reapply once price appears to reverse within an EAGLE range. $USDTRY/M5: Looking At A Potential A-B-C Correction Into EAGLE: OVERALL: Get in the habit of testing your top, where a reversal might occur. To recapitulate: 1 - Define a narrow width from the highest-high to the recent low, from which price may likely be forming a correction. 2 - Said correction should move in a 3-wave form towards the narrow band, or "Bearish Entrapment" in the case of an expected decline. 3 - Enter upon touch-validation of the lower band, or if very aggressive, wait for price to hit the top band, then enter a SHORT position. 4 -Make sure to apply the firmest of discipline by letting go of the trade IF price closes above the SL. Do not even wait for a "BACA" event, or for price to Break-Across and Close Across". Smply get out upon the mere crossing of the SL. Here, SL is the TOP of the price action in the chart, at 6.7996. 5 - MOVING IN THE DIRECTION OF THE TRADE: Seek a target that is STRUCTURAL, that is a target that would correspond to a prior level where price has consolidated. The best method here is to define the center of that consolidation and project it forward as a target. The center is what I have defined in the past as Nodal Core. 6 - MOVING AGAINST THE TRADE: In case of retracement, as may occur at TG-1 or TG-2, look for price spikes that occurred on the "other side" of the counter-advance". Here, the trade expects price to go DOWN. So, look for spikes that occurred as price was moving UP. In the attached chart, I have pointed out to such a spike which occurred on the other side of the wall, hence the name I give to these events: "Transmural", or literally "across the wall". In a future strategy, I will share a method called AFT, or Aggressive Forwards Trading. This strategy, as with all of the other ones that I teach, is NOT a revelation of the CROW Code. I am only sharing with you all of the means and methods that I have developed over time for successful, stress-freetrading. By stress-free trading, I am referring to methods that tell you WHEN to enter, WHEN to rethink and WHEN to take profit. The strategy that I have explained above aims to do just that. It tells you WhEN to enter (E.A.G.L.E. range), WHEN to rethink your position (SL, TG-2, TG-4), and WHEN to exit (TG-2, TG-5 and TG-u). E.A.G.L.E. stands for E xtremely AG gressive L evel of E ntry. Cheers, David Alcindor
Education
by 4xForecaster
11
DXY (Neutral) - - Wednesday FOMC mtg min releaseWhats up Guys - See explanation on the chart - We are going to be looking for opportunities (today and tomorrow) to be preapred to both Long or Short the USD based on the release of the minutes. This post is mostly to give an idea of the thinking that I go through as an active trader. Ten Likes / Comments / Dislikes and I will update the chart Let me know how you feel Intelligent disagreement is always welcome Good Luck - See you on the trading floors #Crypto #BTC #cryptocurrency #forex #DXY #usd -Nix
TVC:DXYEducation
by WillNixTrading
6
HYPERBITCOINIZATION: Adjusting prices for inflationInflation is a measure of a currencies devaluation over time. It is determined by the consumer price index (CPI) which itself is a record of the cost of a standardised basket of goods over time. CPI figures are recorded monthly by governments. Here I use the CPI of the USA. Economists call a price which has been adjusted for inflation the real price . To adjust the price P the formula is simple: P_adjusted = CPI_today / CPI_date * Price_date What this means is that the adjusted-for-inflation price (P_adjusted) for, say, Dec 2014 is equal to the CPI value today (CPI_today) divided by the CPI for Dec 2014 (CPI_date) * the price for Dec 2014 (P_date). Do this for every month in your set. You can see that for Bitcoin this adjustment makes very little difference to the price, because Bitcoin is very young. But if you do this for say gold you can really see how inflation affects value over time. In fact when we adjust for inflation, the 2012 bubble was in fact less dramatic than the 1980 bubble - no wonder, that was the peak of 1970s hyperinflation. Gold was in demand, yet inflation continued to grow steadily since then, meaning today's dollar is worth less than even a 1970s dollar. Going back to Bitcoin, you can move the crosshairs on the main chart and compare prices for a given date. Check the Dec ATH for instance. The price difference will give you an idea of how much the dollar has been devaluing since then. The following chart shows that using July 15 2018 (today) as the reference date, the dollar has lost 14% of its value in real terms since 2010 when Bitcoin trading started.
BNC:BLXEducation
by RealMcafee
5
How to trade reversal patterns & Fib extensions / Elliott wavesWhen you see a morning star pattern (you can use candle software to find such), usually it marks the start of Elliott wave 1 to 5 sequence, you enter at the end of the first correction wave (retrace into the body of morning star pattern). When wave 2 is completed, we plot Fibonacci retracements from the tail of Morning star and you will see how perfectly price reaches Fib extension 161.8 (1.336), the end of Elliott wave 5, doing pullbacks at FE 61.8 and FE 100 (1.326). Metatrader´s Fib extension has extensions of 61.8, 100 and 161.8 but thats enough. Now price is doing ABC correction pattern as you see.
Education
by ICFX
1
Currency StrengthCurrently, USD benefits from two forces that build up sentiment worth mentioning, the Peace Summit and the FED meeting. However, powers are already fainting. Buying power of both currencies is exceeding selling power, however in USDJPY (UJ) there can only be one the strongest. So here it may look JPY is being sold mainly but it's merely aiming down because in the UJ relation the balance of buying against selling is in favor of the USD. Direction of the individual currencies steer the pair of the two. In this case of chart layout, divergence sends USDJPY up and convergence USDJPY down.
Education
by Deep-Peat-Shark
3
Bitcoin vs. Gold. "Ultimate Bubble" face off! + Soros Indicator!Who wins? Bitcoin is definitely the prettier of the two xD Some info: George Soros famously called gold the ultimate bubble in 2010 due to declining interest rates which he felt would lead to the formation of asset bubbles ( link ), however didn't stop him from buying, first in 2010 ( link ) before the bubble burst and then later in 2016 ( link ). He sold off his gold after it peaked in 2012 ( link ) and then reacquired after it found a bottom in 2016. Soros also bet ON Bitcoin in 2017 by acquiring shares in Overstock in Q4 which he subsequently sold in Q1 2018, after the market peaked. Look at the charts. What do you think? Are gold and Bitcoin similar bubbles? Is the Soros Indicator reliable?
FX_IDC:XAUUSDEducation
by RealMcafee
9
VERY IMPORTANT! How to see if a rally is Real or Fake!So many people blame the unpredictable price moves on the whales. (As if the whales aren't investors, too). In lack of better words these people are blaming the unknown for their failure to understand the market's environment. Not to mention spending hours or days over-analyzing a fake rally that is 100% going to deflate So, Dogecoin Shill, what do I do to become a super advanced trading master like you!? Google trends. Go to trends.google.com, type in bitcoin. The bitcoin chart on google trends looks identical to the 1 year chart of bitcoin. As bitcoin's popularity increases, new money comes in and drives up the price. The charts have had one noticeable inconsistency in the last year, which is this recent rally. Bitcoin's price went up 50%, but the popularity stagnated and actually decreased a bit. I took short position at $9k, and tried to post something here at the time but couldn't do it (I'm still figuring out this website) , and I apologize to my followers for that. If you were following me before, I predicted this recent rally in early April when i went long. Leave a like and follow, I do not post on here unless I am extremely confident in my predictions, and if I've already taken the buy or sell position. Peace! -Doge
BITFINEX:BTCUSDEducation
by Dogecoin_Shill
5
The Dragon, The Eagle And The Elephant Investors seem to have started shifting their focus from equities and rates onto the US dollar. We believe that if this dollar rally accelerates it will be a major headache for emerging markets i.e. China, India, and Russia. In part 1 of this report I would like to talk about the Dragon the Eagle and The Elephant, first let’s start with the dragon; China.Over the first few months of 2018, we observed that the PMI’s (leading economic indicator) of China had peaked resulting in a slowdown in the Chinese economy as an economy slows down the prices of commodities tends to follow to the downside. Read more at www.patreon.com
Education
by couragepharm
What's Geopolitics and Ponzi schemes got to do with you?I focus more on historical factors in brief overview in the video. There is an emerging perception that both the EURO and the US Dollar a Ponzi schemes of sorts. How can the US Dollar which is backed by 'thin air' have come to dominate the world. What is a Ponzi scheme? Are there similar elements in both the EURO and the USD? Look and you may see. Geopolitics affects these two. But I'm not really going into the 'fundamental analysis' of this at any deep level, at all. Demand for a currency is influenced by international trade which then is connected to stock markets. I'm not able to dig deeply into the complex interactive connections here. To be clear, I separate Geopolitics from 'Politricks' which I blogged about before. I'm saying that we need to be aware of Geopolitics in the higher time frames like 1D charts. That's not just about currencies - it's also about stock markets. Stuff that may be of interest: A Ponzi Scheme Special Interview Noam Chomsky 2018 A deeper understanding of money from a global pespective - and potential complications, by Yanis Varoufakis The Monetary System Explained - how the Federal Reserve works (or not). Century of Enslavement: The History of The Federal Reserve
Education
by Captain_Walker
Nasdaq_Indexes_Look into todays action_Shorts considered only. Occasionally I will be slapping together a commentary about the days action on my favorite index and making a point to pickout the best entry of the day. This does not mean I take these entries. I simply point them out. These posts will be short simple and insightful. Notice the daily is bearish. We know better than to hold onto long positions. Over the weekend SPX and DOWJ setup very nice looking sell signals. Market makers know all of us retail traders sat around and thought about how bad we wanted to get short all weekend. So first thing this morning they gave us our fills. NQ pushed lower and stopped out tight long trades and entered silly short orders. Then the market made a substantial move higher only to stop out the retail short traders. Only to stall around lunchtime. Markets ticked around until 2pm when we finally started showing bearish signals and my plan allowed my to trade with the direction of the daily. Price broke the lunchtime level and then formed a perfect verification process to confirm we were about to move lower. The market took back all the days gains between 2 and 3:50. Notice the 5 minute chart in the comments below.Cant post the 5 min which truly shows the details of today's move. What a day. Stay tuned! If you found this analysis useful or thoughtful Likes/Comments/Follows are much appreciated! Disclaimer: Your data may be different. Material is educational only. Trade at your own risk!
FOREXCOM:NAS100Education
by UnknownUnicorn981629
Learning how USD corrolates with non-USD currencies. EURCADMy CURRENT definition of RISK. RISK ON USD down, moving XXX/USD currencies up and USD/XXX currencies down. or RISK OFF USD up, moving XXX/USD currencies down and USD/XXX currencies up. Mid term (3 wks-6mo) I lean bias towards 2018 trading in RISK ON mode. Which means EURUSD is a buy mid-term. USDCAD is a sell mid-term. In the last several months we have been in RISK ON mode with EURUSD in a obvious uptrend. I've noticed EURCAD trends UP when we are risk on. So mid-term we cannot expect to short EURCAD because we know the underlying currencies are in up trends. Short term I do believe there is room for a pullback to the 1.53 or 1.52 levels coupled with a pullback in EURUSD. But ultimately I will be looking to trade EURCAD higher in months to come. Full Disclaimer: This is a test I'm running to better understand how correlations among two USD pegged pairs perform when pegged against each other. I will be referencing both EURUSD and USDCAD often. EURUSD is perfectly 1-1 inversely correlated with USD. This is because the EURUSD is the strongest correlated currency to the USD in the world and ultimately controls EURCAD by nature. Trade between the United States and the European Union is over half of USD transactions so EURO's are the most strongly correlated out of all other currencies. That being said when I'm looking at the price of EURUSD, I'm actually reflecting on the price of USD if that makes any sense. EURUSD is up when USD is down BECAUSE USD is down! I track USD with the US Dollar index. Ticker DXY. If you found this useful or thoughtful Likes/Comments/Follows are much appreciated! Disclaimer: Oanda data shown. Material is educational only. Trade at your own risk! and ultimately controls EURCAD by nature
Education
by UnknownUnicorn981629
How to pick a level to buy or sell at effectively?Cause and effect. That's all that you really need to know. Always ask yourself, 'which area started the move that caused a long term key level to break?' What is this important? Because it shows a clear supply and demand imbalance at that price. It shows that there is interest at this specific zone, at which, there is likely to be unfilled pending orders, as well as a desire to initiate market orders on a return to the zone. This is why you might notice that sometimes when you trade a breakout, the market may have a deeper retrace into the level, rather than simply using the broken level as support or resistance (and then stopping you out). You have to interpret price alongside technical analysis, since the market doesn't care about what YOU think, but where it can find the best liquidity to initiate orders. In the Cable example shown, you can see that the $1.70 level played a key part in knowing where price support was on the move up to $2.00+. Using the weekly chart, we can then see where our 'key zone' to sell into is. This is denoted as a supply zone - where you see a bullish candle in a down move just before the key support is broken (or the first bullish candle just before the support is broken). The opposite is true for a demand zone - this is where you see a bearish candle just before the key resistance is broken (or the first bearish candle before a level is broken). This method is very easy in terms of risk management - your stop goes above the supply zone and below the demand zone. I then have a take profit at the next key level - you're just trading between zones. When you become used to this, you can then go down in your timeframes and have more intraday positions, or intrahour if you so wish. A few things - it's easier to manage risk on a longer term trade. It's also easier to increase position sizing on longer term trades, as well as higher timeframes having more overall significance and a higher win rate, although the opportunity cost of this is the fact that you have less frequent opportunities and it requires a hell of a lot more patience.
Education
by FinkPro
Trends are THE MOST IMPORTANT tool in the toolbox.Hello Traders. Hope everyone is staying warm. Snow and zero degree temperatures expected in Virginia. Many traders use many different indicators. There are so many its impossible to tell which ones are useful. Simplicity is key. The most important tool in a traders toolbox is the ability to deceiver the prevailing trend. Using higher high/ lower low analysis we can identify the difference between strong market moves and weaker ones. This stems from the well known philosophy that in order for markets to continue moving in the correct direction they need to confirm momentum shift before making large moves. -Resistance is considered overhead levels that price struggles to break AND CLOSE above. -Support is considered under price levels that price struggles to break AND CLOSE below. Notice how I mention, AND CLOSE. It is 100% required that price CLOSES above the support or resistance level to declare it broken on whatever time frame chart being traded. After the perfect head and shoulders pattern unfolded many traders continued to short EURUSD without much success (Took a stop loss myself) One must recognize the downward momentum was triggered by the bearish head and shoulders pattern (see attached post, traded perfectly.) In actuality the trend is still bullish. At the end of the head and shoulders move, trend reversed only briefly. Price was unable to break the low before moving higher. At (1) the first top was made. After making new highs, we always expect a retest of old resistance confirming support. (2) Price came back and tested old resistance, confirming support in a reckless fashion. This wiped all long traders out and assured direction for short traders who were burned before. Once everyone was mixed up, the trend prevailed to the upside. Now we find ourselves at (3). New highs have been confirmed so price is expected to retest old resistance to confirm as support around the 1.19500ish level. At this level I will be watching diligently for signs of rejection and ready to take entry on a single close of any rejection formations. If we confirm price action, targets are estimated around 1.2300. IF you found this useful or thoughtful Likes/Comments/Follows are much appreciated! TElphee – Self-made Technical Analyst. 5-year market enthusiast with experience in Forex, Futures and Cryptocurrencies. Disclaimer: Oanda data shown. This is NOT investment advice.
Education
by UnknownUnicorn981629
8