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Forex Trading Strategies Reddit: What you need to know to start Forex trading.

Forex Trading Strategies Reddit: What you need to know to start Forex trading.

FOREX Strategies

What are FOREX Strategies?
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You may have noticed that most of people confuse the terminology and refer to FOREX Strategies in the wrong way. There are methodologies, systems, strategies, and techniques. The most effective methodology is Price Language (Trend Tracking). Combined with a correct reading of mass psychology presented by the charts.
We know that in the Stock Markets there are thousands of strategies. FOREX, like the rest of the markets, presents you with the opportunity to apply similar strategies to win consistently. Taking advantage of repetitive psychological patterns.
First, the Price Language methodology has created great fortunes in FOREX, and the next fortune may be yours. But this methodology must be implemented within a framework of advanced concepts of Markets. Without forgetting the basics. And working hard day by day.
Second, a strategy is a set of parameters and techniques that together give you the advantage to act in any situation. Thus for example in war, generals have attack strategies and counterattack strategies.
FOREX strategies alike are entry strategies and exit strategies. All beginners should know these FOREX strategies for beginners. That way you will get a general idea of ​​the game and understand that trading is a war against the Market and its Specialists. Only applying FOREX strategies revealed by the same Specialists and using their own techniques,
... you can survive in this war.
Do not fall into the trap of the many "systems" and "methods" that are offered on the internet about operating in the FOREX Market. They just don't work in the long run. They are strategies based on indicators for the most part. Using rigid parameters. That if they can work and give profitability during a certain period of time, they will always reach a breaking point when the market changes its dynamics.
Instead, take advantage of your precious time and learn the Language of Price or Price Action.
The Language methodology will allow you to adapt to each new phase of the Market. If you combine this knowledge with the appropriate psychological concepts, you can live comfortably from speculation in FOREX.

Forex Trading Strategies Reddit - Basic FOREX Strategies

You have two basic FOREX strategies, one entry, and one exit. Both follow a general strategy that helps you capitalize on the collective behaviors of the Market. That is, of the total of participating speculators.
This behavior causes the formation of cycles that repeat over and over again. Driven by the basic emotions (uncertainty, greed, and panic) of the speculators involved that can be taken advantage of with the aforementioned FOREX strategies. Specialists identify these emotions in the order flow and capitalize on these events every hour, every day, and every month.
Basic FOREX Strategies - The Price Cycle
These repetitive cycles consist of 4 phases:
  1. Accumulation
  2. Upward trend
  3. Distribution
  4. Downward trend
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The two trends can be easily identified by their notorious breakdown. And the two areas of uncertainty (accumulation and distribution), due to their notorious range trajectories.
This general behavior determines the core of our FOREX strategies.
You buy when the price of a pair has broken and has come out of one of its congestion formations (accumulation or distribution). You implement one of the Forex strategies, in this case, the entry one.
The multi-time technique will help you find the point of least risk when entering your initial buy or sell order. In the same way and using the same strategy but this time to close your position, the multiple timing technique will also show you how to close your operation obtaining the highest possible profit.
The most consistent way to extract profits in the market is by trading the start of trends within a cycle . Once confirmed by their respective breaks from the areas of uncertainty. This is the mother of all FOREX strategies . And in a market that operates 24 hours, we have more frequent cycles and therefore more opportunities.

Forex Trading Strategies Reddit - Advanced Forex Strategies

There are many advanced FOREX strategies that are generally used by professional speculators working for large financial firms.
Among these firms are banks, Investment Fund managers and Hedge Fund managers. The latter is an investment modality similar to Investment Funds, with the difference that Hedge Funds use more complex investment strategies. Its operations are more oriented to aggressive speculations in the short and medium-term.
Among the most common strategies is hedging (hedging), carry trade, automated systems based on quantum mathematics. And a large number of combinations between the different option strategies.

The Carry Trade

The central idea of ​​Carry Trade is to buy a pair in which the base currency has a considerably higher interest rate than the quoted currency. To earn the difference in rates regardless of whether the price of the pair rises or falls.
Suppose we buy a $ 100,000 lot of AUDJPY, which according to the rates on the chart would turn out to be the ideal instrument in this example to use the Forex carry trade strategy.
As our capital is in US dollars we have to assume for our example, the following quotes necessary to perform the place calculations:
AUD / JPY = 80.00 USD / JPY = 85.00
What happens internally in your broker is this.
  1. By placing as collateral $ 1,000 of your $ 50,000 of capital (assumed for this example), deposited in your account, you have access to $ 100,000 virtual (this is what is known as leverage); that is, you put in $ 1,000 and your broker lends you 99,000.
  2. With those $ 100,000 virtual dollars, your broker borrows on your behalf ¥ 8,500,000 Japanese yen (85 × 100,000) at 0.1% annual interest from a Japanese bank.
  3. With those ¥ 8,500,000 Japanese yen, your broker buys A $ 106,250 Australian dollars (8,500,000 / 80) and deposits it in an Australian bank where it receives 4.5% annual interest on your behalf.
  4. One year later (and regardless of the profit or loss generated by the pair's movement), your profit will be the difference between the AUD rate and the JPY rate, that is:
Profit = (AUD rate) - (JPY rate) - (costs of the 2 currency exchanges) Profit = (4.5%) - (0.1%) - (0.1% to 1%)
The great advantage of carry trade FOREX strategies is that this percentage profit is applied to the $ 100,000 of the standard lot; the broker transfers all of the profit to you, even if you only contributed $ 1,000. On the other hand, if you carry out the inverse of this operation, this benefit of the Forex carry trade becomes a cost (swap), and you assume it completely.
Remember that FOREX carry trade strategies are recommended for pairs with considerable interest rate differences, such as the one we have just seen in our example.
These FOREX strategies should also not be used in isolation. The idea is that through technical analysis you identify when would be the ideal time to enter the market using your carry trade Forex strategy and multiply your profits considerably.

What FOREX Strategies Do Hedge Funds Use?

The FOREX strategies used by large fund managers do not constitute an advantage in terms of percentage results for them, nor do they constitute a competitive disadvantage for you.
The vast majority of them fail because of their big egos. In fact, there was a firm made up of great financial geniuses, including 2 winners of the Nobel Prize in Economics, who developed a strategy based on quantum mathematical calculations.
With an initial base capital of about 3 billion dollars, and after 3 successful years obtaining annual returns of over 40%, the firm Long-Term Capital Management, begins its fourth year with losses. To counteract these losses the geniuses decide to multiply the initial capital several times, while the losses continued.
The year closed with the bankruptcy of the fund, and with a total accumulated loss of 1 trillion dollars, due to the great leverage used. And all for not admitting that the FOREX Strategies of Long Term Capital Management were not in line with the dynamics of the Market.
There are an overwhelming number of opportunities in the stock markets to make money interpreting the Language of Price.
You don't need to use complex "advanced" strategies that have been created to handle hundreds or billions of dollars.
The reasons for using these FOREX strategies are very different from what a "retail trader" pursues with his small speculation business.
As you can see, you should not worry about wanting to integrate any of these advanced strategies into your arsenal. They are only beneficial for managing hundreds or billions of dollars, where the return parameters are very different when you handle small amounts of capital.
Do not worry about collecting hundreds of free FOREX strategies that circulate on the internet, that great accumulation of mediocre information will only serve to confuse you and waste your valuable time.
Spend that time learning Price Action,
… And you will always be one step behind the Specialists, identifying each new Market condition, and anticipating the vast majority of reversals of all prices.
Ironically, the most successful fund managers indicate that their most profitable trades are those based on the basic trend-following strategies of the Price Language. The same ones that you will learn in this Free Course.
Dedicate yourself to perfecting them and believe me you won't need anything else. As long as you have good risk management, taking into consideration the following points ...

Styles of Investments in FOREX

The Investment FOREX long term is not recommended for small investors like you and me. If we take into account the term investing literally as large investors do who buy a financial product today to sell it years later.
We both have a better niche in the short and medium-term.
You may have noticed that the big multi-year trends in the Forex Market do exist. But minor swings within a big trend are usually very wide.
These minor movements allow us to easily double and triple the annual return of the big general trend, motivating most traders to speculate in the short and medium-term.
These minor oscillations or trends that occur within the large multi-year trends owe their occurrence mainly to two reasons.
First, the FOREX Market presents 3 sessions a day each in different cities of the world with different time zones (Asia, Europe, and America). This causes more frequent trend changes than in the rest of the stock markets.
Second, the purpose for which it was created also plays a role. The modern Foreign Exchange Market, since its inception in 1972, was conceived by the global financial system as a tool for speculation. To obtain benefits in the short and medium-term (from several days to 1 year).
These two points are basically the reasons why we observe the immense speed with which the FOREX market changes trends.
For example, for those who live in America, in the early morning (Europe) the EURUSD pair may be on the rise, in the morning or afternoon (America) it may be down, and then finally at night (Asia) it may return to the rise.

Define your Own Style for your FOREX Investments

One of the first decisions you will have to make is to choose your style as a trader or investor.
There are 4 types of well-defined styles.
Most professional traders tend to have multiple styles, although they always identify with one primary style for their FOREX investments. Study the characteristics of the 4 main styles to make your investments in FOREX :
1. Long Term: recommended for anyone who is going to enter the market for the first time and who can dedicate a minimum of one hour per month to their investments in Forex. The period of an open position ranges from 1 year to 5 years.
2. Medium Term: recommended for anyone who is going to enter the market for the first time and who can dedicate a minimum of one hour per week to their investments in Forex. The period of an open position ranges from 1 month to 1 year.
3. Short Term: recommended for anyone who is going to enter the market for the first time, or who already has a certain time operating in the long and medium-term, showing constant profits, and who can dedicate a minimum of one hour per day to your investments in FOREX. The period of an open position ranges from 1 day to 1 month.
4. Intraday : recommended only for people with a fairly solid earnings record in the short term, and with a capital greater than $ 50,000. As we have noted, this option constitutes a full-time job.
People who start investing in FOREX , should start executing short-term (weeks) and medium-term (months) transactions only, and not pay attention to intraday oscillations (day trading).
If you are interested in being an intraday speculator, I recommend that you first exhaust at least a year doing operations in the short and medium-term to assimilate the correct strategies and to develop the necessary mentality to carry out this work.
The second option would be to participate in some kind of intensive training.
I remind you that self-educating is almost impossible in speculation. You are likely to accumulate a lot of knowledge by reading books and attending courses. But you will probably never learn to make money with all the incomplete "systems" circulating on the internet.

Mistakes to Avoid When Looking for Your Style

Many people who are new to FOREX investments make the mistake of combining these styles, which is a key to failure.
I recommend that if you are not getting the results you expected by adopting one of these styles, do not try to change it. The problem sure is not in the style, but in your strategies or in your psychology.
A successful investor is able to make a profit in any longer trading time than he is used to. I explain. If you are already a profitable operator in the short term, it is very likely that you will also be profitable in the medium and long term,
… As long as you can interpret the Language of Price or Price Action.
In the opposite case, the same would not happen. If you were a medium-term trader, you would need time to adjust to the intraday. The reality is that long, medium and short term traders have very similar personalities. The intraday trader is completely different.

The Myth of the Intraday in Investments in FOREX

If you are already successful in the short, medium and long term, you will notice that the sacrifice and the hours necessary in front of the computer to operate intraday is much greater. The intraday style will be useful to increase your account if it is less than USD $ 100,000 in a very short time in exchange for 8 to 12 hours a day of hard work but ...
You must first develop the necessary skills to operate the intraday.
The ideal is to combine all the styles to get more out of the Market and carry out more effective transactions and have a diversification in your investments in FOREX.
There are intraday traders that are very successful, but the reality is that there are very few in the world that make a profit year after year. If you want to become an intraday, you just have to prepare yourself properly through intensive training.
Otherwise, I recommend that you don't even think about educating yourself to adopt the intraday style. It is not necessary to go against a probability of failure greater than 99%. Unless
... your ego is greater than your common sense.
The main reason why this style of investments in FOREX is not recommended for the vast majority of us "retail investors" (the official term "retail traders"), is the high operational cost.
The real commissions in this market range between $ 2.0 and $ 2.50 for each lot of 100,000 virtual units. This means that a complete operation (opening and closing) is approximately $ 5.00, for each standard lot traded ($ 100,000 virtual).
Another fundamental reason is the advent of robotic traders (HFT = High-Frequency Trading), which tend to manipulate the market in the shorter intraday swings. Please do not confuse HFTs with automated systems that we find daily on the internet, and that can be purchased for a few hundred dollars and often for free on FOREX forums / groups.
These HFTs to which I refer, they are effective. They cost millions of dollars and have been developed by the large Wall Street financial firms to manage their investments in FOREX.
The reality of the intraday trader is that you execute orders for large lots at the same time, to profit from the smallest movements in the market. It is an activity based on reflexes. The slightest oversight or distraction can turn into a catastrophe for your FOREX investments.
I recommend that you start investing in FOREX using slow time periods such as H4 or Daily. For some reason, all Goldman Sachs intraday FOREX investments are made with algorithms.

Finally…

To choose your style as a trader and manage your investments in FOREX, first determine what your degree of experience is, analyze the points mentioned below and the rest you will discover when you execute your first operations.
The points that will affect your decision are:
  • Capital
  • Time available each day
  • Level of Experience
  • Personality
Discovering your style is a search process. For some it will be a long way to find the right time frame that matches their personality. Don't be put off by the falls. After all, those who continue the path despite the falls are the ones who reach the destination.
And I hope you are one of those who get up over and over again. The next lesson will boost your confidence when you discover the main reason that moves currencies ...

Fundamental Analysis in Forex Trading Reddit

The fundamental analysis in Forex is used mostly by long-term investors. Players as we saw in the styles of operators, start a negotiation today, to close it years later.
I always emphasize the importance that the mass media give to this type of analysis to distract the great mass of participants.
It is all part of a great mass psychological manipulation. For centuries the ignorance of the masses has been organized before the great movements begin.
The important news are the macroeconomic reports published by the Central Banks and other government agencies destined for this work. All reports are made up. 99% of them are corrected months later.
These events are tools to justify fundamental analysis and price cleaning movements. Any silly headline does the job. With this, it is possible to absorb most of the existing liquidity, before the new trend phase is projected.

Reaction!

Except in rare situations, the result of an economic report of the fundamental analysis is generally already assimilated in the graph. In most cases, there are financial institutions that already have access to this information and are organizing and carrying out their operations in advance.
The phrase buy the rumor and sell the news is a very old adage on Wall Street. And its meaning contains what we have just explained. For the investor who can interpret the Language of Price, fundamental analysis is of little importance. Well, in general, their disclosure does not indicate that you have to take any action in your open trades , as long as your entry strategy provides you with a good support cushion.
This reality of fundamental analysis causes a lot of confusion for investors who lack in-depth knowledge of the forex market.

Macroeconomic Data

The data published in these events is irrelevant. Both for speculators and for the people in general. They are false. They lack reliability.
The price can go up or down with the same result of the data. The main ones are:
- Interest Rates - GDP (gross domestic product) - CPI (inflation) - ISM (manufacturing index) - NFP (payroll) - Double Deficits (deficit = fiscal + balance of payments)
If you are initiated, I recommend you avoid operating near these events. It is only a matter of having the time pending. Use the economic calendar for Fundamental Analysis of Forex Factory.
There is a probabilistic advantage in operating these fundamental analysis events. But it takes preparation, experience, and practice. They represent a way of diversifying in the general operation of a speculator.

The Uncertainty of Fundamental Analysis

On many occasions after the disclosure of an economic report, the price movement of the currency pair that is going to be affected tends to move in the opposite direction to the logic of the report.
I show you an example of a fundamental analysis report. Imagine that the EUR / USD pair is trading at 1.2500, and the FED (US Federal Reserve) issues a statement announcing that it has just raised inter-bank interest rates from 0.25 points to 0.75 points. Very positive news for the US dollar that logically implies an appreciation of the currency and consequently an instantaneous collapse of the EUR / USD pair (up the dollar and down the euro)
However, minutes after the release of said fundamental analysis report, the pair after effectively collapsing to 1.2400, returns and returns to its levels prior to the report (1.2500). This situation is very common , but it is not so easy to identify it when it is occurring, but after the damage is done.
Traps like these devour the accounts of beginners who approach the market with little experience, with weak strategies, and especially with very little experience.
That is why I reiterate that you forget the fundamental analysis for now. Just keep in mind when operating, that there is no publication scheduled nearby. Just check the economic calendar for the day and forget about the numbers. Let the economists mess around with the data.

FOREX Market Correlation

The Forex market correlation exists between pairs with similar "base" currencies and not always under the same circumstances. The correlation in the Forex market that is most followed and that has the greatest impact on fundamental analysis is that of the US dollar (USD).
The USD is the most traded monetary unit with a volume greater than 80% with respect to the rest of the currencies. This fact determines why their correlation is the most important, the most followed, and perhaps the only one worth following in the fundamental macro analysis.
The 7 major pairs are usually in sync . These 7 pairs all include the USD and present a fundamental analysis correlation almost 75% of the time. Influencing the rest of the currency pairs.

Advantages of the FOREX Market Correlation

In the fundamental analysis the most basic FOREX correlation is the following. When the USD appreciates, the USD / CAD, USD / CHF, and USD / JPY pairs tend to go up in price. This indicates that the Canadian dollar (CAD), the Swiss franc (CHF), and the Japanese yen (JPY) are losing value against the USD.
We must bear in mind that this correlation does not occur 100% of the time. In fact, the JPY generally tends to move in the opposite direction , since in recent decades this currency has been used as a source of financing to invest in other financial instruments.
On the other side is the FOREX market correlation that generates a movement almost in unison in the other 4 major pairs EUR / USD, GBP / USD, AUD / USD, and NZD / USD. These tend to fall in price, homologous the appreciation of the USD. But not always.
In this case the fundamental analysis correlation works most of the time, between 65 and 85% of the time. Small differences are noted in the extent that each of these pairs experiences.
There is also a correlation in the secondary FOREX market, where the pairs of all currencies that do not include the USD participate, but I recommend you not to waste time on them for now. There are more important things about the Language of Price to know first.

FOREX Commodity Correlation

In this part I will explain to you in a basic way the Correlation Commodities - FOREX of the fundamental analysis.
There are three currencies that have a direct correlation with commodities. They are usually called: "COMDOLLS" which is short for "Commodities Dollars" (Commodities Dollars), since all three obey the dollar denomination. These are:
- The New Zealand Dollar (NZD) - The Australian Dollar (AUD) - The Canadian Dollar (CAD)
These three currencies make up the group of the 8 largest together with the euro, the pound, the yen, the franc and the US dollar. Together, they merge to produce the major pairs traded in the FOREX Foreign Exchange Market.
The FOREX Commodity Correlation has an affinity in most cases greater than 75%. And each of them has its different raw material of correlation. You will notice that the NZD and the AUD are two currencies that act practically in unison. Both present minimal discrepancies in their fluctuations in the short, medium and long term.
This is mainly because their economies are very similar and their economic and fiscal policies are too. Their main production items also show great similarities, despite the fact that the Australian economy is much larger than the New Zealand economy.
The raw materials that follow the movement of the AUD are mainly gold and copper. If you put the history of these three quotes during the last decade of the year 2,000 together on the same chart, you will notice a very similar upward movement between the three quotes. Pure correlation of fundamental analysis.
This strong correlation with commodities in the metals area for the AUD has provided Australia with an economic advantage enviable over the other major powers that have seen their currencies devalue sharply against the AUD. At the same time, they experience a constant decrease in the purchasing power of their citizens.
The NZD maintains a correlation with raw materials related to agriculture and livestock, mainly including milk and its derivatives. It is one of the countries that dominates the world export of these economic items, and also has important exports of metals , although in smaller quantities than Australia.
Finally, you have a correlation with raw materials in the energy area. For historical reasons the CAD, which is not the largest oil producer in the world, but an important supplier to the largest consumer that is the US, has seen its currency oscillate in line with oil prices.
To make long-term investments in the Foreign Exchange Market, it is necessary to take into consideration at least one Commodity Correlation - FOREX in your fundamental analysis.

Forex Technical Analysis Reddit

The technical analysis is the methodology that interprets the movements of the price. Specialists look for liquidity to fund their business. The repetition of the strategies used by the specialists in their work generate repetitive patterns.
If you were an analyst, you would develop the visual ability to identify such patterns on a graph. If you were a programmer you would quantify them mathematically using complex formulas.
And if you could learn to interpret the Language of Price, you would have the ability to anticipate 90% of all movements that occur on a chart. And in this business, anticipating is what will make you money.
Market prices are reflected and framed on a horizontal time axis and a vertical price axis. Prices go up or down according to the aggressiveness of the participating operators. In an efficient or balanced market these oscillations should be imperceptible.
But in reality this is not the case, since the Market works thanks to the digital printing of hundreds of billions of units of paper money systematically distributed by the Central Banks through the banking system. These resources serve as a tool to manipulate 100% of the movements that occur in the FOREX Market.
Are you looking for Technical Indicators? All technical indicators were created from the 70's. How do you think that for more than 200 years the speculators of the past accumulated great wealth?
With the Language of Price. The best timing is given by the price itself. Indicator-generated entry signals usually occur at the wrong time.
The basis of technical analysis is human psychology. Unfortunately, human beings are not perfect and are loaded with emotions that dominate their behavior in similar situations, creating repetitive and highly predictable behavior when it occurs in masses.
The study of technical analysis through indicators and subjective training, originates and shapes the collective thinking on which all the traps that specialists execute every day to maintain their business are designed. If the majority won, the Market would cease to exist.
Although you already know that the patterns are not generated by the masses , but the repetitive behavior of the Specialists in the face of the action response of the masses. It is very easy for speculaists, because they can see everyone's orders in their books.
And they also exert a great influence on the decisions of the masses through the mass media. It is what I call the war between the Egg and the Stone , if you hit me you win and if I hit you also you win.

The Deception of Modern Technical Analysis

Through the centuries thousands of people have been able to extract great benefits from the financial markets by applying the basic strategies of technical analysis and the psychology of the Price Language.
More than 200 years ago when the markets began to operate officially, fundamental analysis predominated, which was only used by large financial institutions. As this analysis tool began to become popular, these institutions began to apply the strategies of technical analysis.
In recent decades and with the massification of internet technology, technical analysis has begun to be handled by anyone who has a computer with internet access. The same financial institutions, which have been present for more than a century and as a result of this overcrowding , establish a strategy to confuse and misinform about the true strategies of technical analysis.
This has been accomplished in the following manner. Currently there are hundreds, if not thousands of technical indicators that have been developed by so-called "gurus" of technical analysis and that sell their magic indicators packed in a "system" or "method" that usually cost thousands of dollars, or simply with the publication of a book with which they generate large profits. Double benefit.
The aim is to confuse the initiates in speculation and create the collective mentality that will originate the same behaviors over and over again. About 95% of these new entrants completely lose all the capital they invest in their early stages as investors.
Leaving them with a negative experience and creating the idea and the image that financial markets are an exclusive area for geniuses with high academic levels and that only they can produce returns in the markets year after year.
The initiate, having lost all his original capital, turns to these “gurus” for help and teachings. You spend more capital on the products they offer you and the cycle repeats itself . Obviously, the vast majority do not relapse and completely forget to re-engage in the stock markets.
I hope you have not been a victim of this drama.
Now I will show you the simplicity of a FOREX technical analysis , without the need to resort to any indicator as a tool to determine an effective entry or exit strategy when planning your operations.

The Price Cycle

Previously you studied in the FOREX strategies lesson, that the typical price cycle when it is reflected in a graph, presents four very specific phases and very easy to identify if you perform a technical analysis with common sense . These are:
  • Accumulation
  • Bullish trend
  • Distribution
  • Bearish trend
Remember also that the most effective way to constantly extract profits in the markets is by taking advantage of phases 2 and 4 (the trends). Combined with a correct reading of the collective behavior of the masses of speculators interpreting the Language of Price.
You will be surprised by the simplicity with which thousands of people around the world and over the centuries have accumulated large sums of money by drawing a few simple lines and applying responsible risk management with their capital.

How to Identify Trends?

Being able to determine the trend phases within the price cycle is the essence of technical analysis since it is these two phases that provide you with the probabilistic advantage you need to operate in the markets and obtain constant returns.
In the most plain and simple language, in the world of technical analysis, there are only two types of formations: trends and ranges.
The trends, in turn, can be bullish if they go up, or bearish if they go down. The ranges, on the other hand, can be accumulation if they are at the beginning of the cycle, or distribution if they are in the high part of the cycle. As I had indicated in the topic of FOREX strategies when describing the price cycle.
This sounds more like a play on words, but I will show you the practical definition to simplify your life and then you will apply these definitions on the graph so that everything makes more sense to you.
  • Bullish trend: a succession of major highs and major lows
  • Bearish trend: a succession of minor highs and minor lows
  • Floor Range: equal highs and varied lows
  • Ceiling Range: equal minimums and varied maximums
https://preview.redd.it/vvmsshf0guv51.png?width=600&format=png&auto=webp&s=c321679a7dcc03f7184778be86379ef442fddf91
Some key points from the graph:
  • The start of this big uptrend was detected when the last high (thick green line) of the previous downtrend was broken to the upside, ending the succession of lower highs, while exiting the lateral floor formation.
  • The succession of major lows in the uptrend (thin blue lines)
  • The succession of major highs in the uptrend (thin green lines)
  • The end of the uptrend was detected when the last low (thick blue line) of the uptrend was broken to the downside, ending the succession of higher lows, while exiting the lateral ceiling formation.
A tool that will help you sharpen your technical eye and identify trends on the chart is the Currency Scanner. This application is very effective and will provide you with a much-needed boost in your operations to identify reliable trends. At first, we are not sure how reliable a trend is. You will receive great help to find opportunities with the Currency Scanner .

The Common Sense, The Less Common of Senses

The central idea of ​​technical analysis consists in determining the price situation of a market, that is, in which phase of the pattern of its cycle it is currently conjugated with the collective thinking of the masses and the possible traps that the market would have prepared to remove. the capital at stake by the public.
To carry out a precise technical analysis, you will use the support and resistance lines, which can be static (horizontal) or dynamic (projecting an angle with respect to the horizontal axis).
Your common sense prevails here.
If you show a 10-year-old a chart, they will be able to tell you if the price is going up or down. You will most likely have no idea how to draw the lines, but you will be able to establish the general trend. Simply using your common sense.
By introducing indicators and other gadgets , the simplicity and effectiveness of the technical analysis created by your common sense evaporates.
The following graph conceptually shows you all the possible situations in which you could draw these lines to carry out your technical analysis of the place. You can clearly observe a downtrend delimited by its dynamic trend line and an uptrend on the right side with its respective dynamic delimitation.
https://preview.redd.it/5iehg0r6guv51.png?width=500&format=png&auto=webp&s=84c265a5d35da7ea970792c4bf40fe20b33bd8bd

Forex Charts Analysis

I want to remind you that the formations or patterns that develop on the charts (triangles, wedges, pennants, boxes, etc.) only work to execute trades that have initially been confirmed by the static support and resistance lines and to read the collective thinking of the masses.
Chart formations work, but you must know the Language of Price to determine when the Specialists will exploit a chartist figure, or when they will allow it to run. In fact, you will learn with the Language that you can operate a chart figure in any direction.
Much of the "mentalization" that the masses receive is to believe that the figures are made to be respected. Which is an inefficient way of working. Simply because you could wait days or months for a perfect chart figure to occur in order to perform a reliable trade. When in fact there are dozens every day.

Japanese Candles

Of all the tools you have to carry out technical analysis, perhaps the best known and most popular is the Japanese technique of candles (candlesticks).
Candles are mainly used to identify reversal points on the chart without resorting to confirmation of horizontal trend lines and only using a previous bar or candle breaks.
Its correct use is subject to a multi-time analysis (multiple temporalities) and a general evaluation of the context proposed by the market in general at the time of each scenario.
Later I will show you all the important details to take into account so that you use Japanese candles in a simple and very effective way.
Do not forget ... Trading in your beginnings based on formations (chartism) and candlestick patterns conjugated with hundreds of tools and technical indicators, constitutes the perfect path to your failure. Before using any strategy or technique I recommend you focus on learning the Price Language, which includes 3 basic things:
  • The Price: structure and dynamics
  • Market sentiment: relative strength, external shocks, etc.
  • Psychology: flexible mindset and risk acceptance
After you acquire this solid foundation, I guarantee that you will be able to trade any trading system that exists, any strategy, technique or chart figure in a profitable and consistent manner.
Specialists make money every day at the expense of the collective behavior caused by the use of these strategies and techniques. With which you will only manage to lose your capital and your time by putting the cart in front of the horse.
People who do the opposite, at best become,
... Philosophers of Speculation, or indocile Robot Assistants or Expert Advisors.
To make money in any market condition, range or trend, you must use the technical analysis based on the Price Language and combine it with a correct psychological reading of the price. This knowledge can only be acquired through proper education and lots of supervised practice. Like any other career in life.
I hope you've found this guide helpful!
submitted by kayakero to makemoneyforexreddit [link] [comments]

VfxAlert signals and candlestick patterns

VfxAlert signals and candlestick patterns
All how to make on binary options strategies should take into account all market analysis options. You cannot make a decision on only one instrument, even if these are candlestick analysis patterns.
Let's start with trend signals, see examples of vfxAlert binary signals.
Currency pair GBP/USD and a strong signal on PUT-option signal. Let's look at the price chart - confirmation by the "Three Method" candlestick pattern and you can open an option with an expiration of 5-10 minutes.

https://preview.redd.it/gwn6hg5fs8p51.png?width=1100&format=png&auto=webp&s=f67cae8d8fde0e38a27318f8eadea0e2c3cad495
The signal appeared at the intersection of the moving average ("MA" on the signal panel). Traders see this. The option opens on a reversal, but then there are also candlestick patterns, and new PUT-signals with the “MA” label open the next options with a large volume.
The next signal on the CCI indicator shows the dynamics of the current trend. Created for the stock market, where trends are long and easier to find. On Forex, volatility is higher and there may be strong corrections and pullbacks that "break" the indicator. In the figure, binary options trading signals is confirmed by a strong candle pattern – the price goes towards the gap and you can open a CALL-option.
Reversal real binary options signals vfxAlert.
More reliable than trendy ones, beginners should start with them. It is easier to see and understand: "Bulling engulfing" pattern, which means the "bulls" managed to shift the balance of power to themselves and start an uptend on EUR / GBP. The vfxAlert signal confirms this by technical analysis of the RSI indicator.

https://preview.redd.it/gpikbe6js8p51.png?width=1100&format=png&auto=webp&s=8581ebe0a59f665b78891996f23d95c289972250
Doji candlestick appeared on EUUSD. In candlestick analysis, this is the strongest reversal pattern. The vfxAlert binary options signal according to Parabolic SAR trend confirms the beginning of the downtrend. After one candlestick, the trend started you can open the PUT-option.
The trader looks at «Power» value first, the market may be sideways, and candlestick patterns are false:

https://preview.redd.it/efwtnupms8p51.png?width=1100&format=png&auto=webp&s=1170e6526704d44ec1a0ee936de5797f41e61d31
We always start testing combination "vfxAlert live binary signals + candlestick patterns" on a demo account. You only receive recommendations and must make sure that they fit your strategy, trading session and trading style.
submitted by vfxAlert to u/vfxAlert [link] [comments]

The Top 12 Chart Trends You MUST Learn to Trade successfully in 2020

The Top 12 Chart Trends You MUST Learn to Trade successfully in 2020
The Top 12 Chart Trends You MUST Learn to Trade successfully in 2020

If you want to be a proficient technical analyst, you've got to practice understanding chart trends.
Chart patterns, with great profits, can generate very reliable signals and reward traders.
We cover the top 12 chart trends with examples in this article and show you how to use them and how to make money trading with them.

The Head and Shoulders Pattern
The head and shoulders pattern is considered to be one of the most effective models for reversal. It begins when the price rises to the top after a long bullish run, and pulls down.
Shortly thereafter, the price increases again to a slightly higher rate but again decreases.
Finally, for the third time, the price goes up but only hits a point of the first high.
It pulls back after that and completes the pattern.

Head and Shoulders Pattern 2020

Inverse Head and Shoulders Pattern
There is also, as with other trends, an inverse head and shoulders that
happens after an prolonged downtrend and suggests that the price will go up.

Inverse Head and Shoulders Pattern 2020

Cup And Handle Patterns

A pattern on the cup and handle is a bullish pattern of continuity.
It is made up of two parts-a cup and a handle.
When a cup is full, the handle is shaped on its right side.
If a breakdown on a line of resistance follows, and traders find it a precursor for an uptrend.

Cup And Handle Patterns 2020
Cup And Handle Patterns (b) 2020


As you can see, there is nothing difficult about recognizing and trading a 'Cup and Handle' pattern.
Upon entering the trade on a resistance retest, you can put your stop loss below a handle's low and let the trade do its job.

Ascending Triangle
One of the most common patterns among traders are both ascending triangles and descending ones.
We should take a look at it from more of a rational viewpoint to really help you understand this trend.
The ascending triangle is formed when the price is incapable of breaking a resistance but, at the same time , higher lows form.

Ascending Triangle Pattern 2020

As you may see in the above example , the price bounces from resistance but on each bounce it is unable to make a lower low.
That gives us a bullish signal that a potential break is about to occur.

Ascending Triangle Chart Pattern 2020

Descending Triangle
Inverse to the Ascending Triangle, the Descending Triangle is noticeable when
the market bounces from support but can not hit higher altitudes.

Descending Triangle pattern 2020


Descending Triangle Chart Pattern 2020



The Falling Wedge Pattern
Falling wedge is a bullish trend of reversal that happens most of the time while
the price is going down but we can see divergence on one of our oscillators.
That means that while the price goes down, sellers
get tired and we can expect a reversal soon.

The Falling Wedge Pattern Chart Pattern 2020

Rising Wedge
Reversal of Dropping Wedge, price is moving higher
but in your oscillator you can find weakening clues.

Rising Wedge Chart Pattern 2020

Double Top Pattern

Typically the double top pattern is made at
the end of the trends as a toping shape.
It is a bearish reversal trend characterized by the peak which is
followed shortly by the second at the same or very close price point.
The double top pattern is true until
the price breaks below the highs rendered support.
We use the same word "neckline" that is
used for the Head and Shoulders pattern as well.
You may either join the trade after the
neckline is broken, or wait for the neckline's retest.


Double Top Pattern Chart Pattern 2020


Double Bottom Pattern

The Double Top opposite is the Double Bottom pattern
that is made at the bottom of the downtrend.
The Double Bottom is defined as having two
bottoms at a price point equal to or identical.
Just as with the Double Top pattern, you can
enter either at the "neckline" break or at its retest.

Double Bottom Pattern Chart Pattern 2020



Flags

Flags are technological patterns that can be understood
as a pause in the trend that underlies.
Following a rapid market pattern, flags are spotted as
consolidation, and they signify the continuation after the breakout.
We have a Bull and Bear flags, just as with all map trends.

Bear Flag

Bear Flag Chart Pattern 2020


Bull Flag

Bull Flag Chart Pattern 2020


Conclusion
Classic chart patterns are one of the oldest sections of technical analysis and have been proved several
times as a practical way to assist technical traders in determining the next course of the market.
That being said, when making trade decisions, a trader
should not neglect the context and current market conditions.

Eva " Forex " Canares .
Cheers and Profitable Trading to All.



About FTMO -
They fund forex traders. Just Pass their risk management rules and begin trading for their company. They'll provide you capital up to $300k USD for trading the financial markets. 70% of profits you keep and losses are covered by them. How does it work?
How to Become a Funded Forex ,Stocks or CryptoCurrency Trader?
submitted by Eva_Canares to FTMO_Forex_Trading [link] [comments]

Forecasting the End of Major Corrections, and Accumulating Trend Trading Positions.

Forecasting the End of Major Corrections, and Accumulating Trend Trading Positions.
A prerequisite post to this post can be read here; https://www.reddit.com/Forex/comments/clx0v9/profiting_in_trends_planning_for_the_impulsive/
It will also be beneficial to read this;
https://www.reddit.com/Forex/comments/clbxk2/shorting_noobs_common_trend_following_mistakes_im/

Before getting into the meat of things, you need to understand the 'elastic band' effect of large moves in the market. What this means is most of the time before a market starts to make a big move in the direction it is ultimately going, it will make a strong and usually fast counter move. You know this already in a way. You've been taught from early on (I assume) that pin bars (hammers etc) are indications the market is reversing. You're told the wicks are formed by price pushing into an area and being rejected from it.

In a trend formation, this is what the intra-week price action would tend to look like when there is the formation of reversal candles at the close of the weekly timeframe.


https://preview.redd.it/nv1nbk0c9th31.png?width=909&format=png&auto=webp&s=f87d94ee33f0d07cde211c05d9234a236a487309
Here we would have been in a down trend and then for a week or two seen bullish momentum. The blue swing is the "elastic band" move. Or what I like to call the "ping swing".

The formation I have drawn here is not arbitrary. A lot of specific things are going on in this chart. Here I've highlighted the relevant ones. When we've seen all of these, we know there is a good chance we have reached the end of a C leg correction (read up on basic Elliot wave theory if you do not understand this terminology).


https://preview.redd.it/8u9bg43nath31.png?width=1066&format=png&auto=webp&s=1ddb04a27b9a99ddbcaab5eef4e3ca7eea78e000

There can be variance in the 4 and 5 area. I am being polite, I should be honest. This area is often a bitch to trade in. Sometimes there are deep retracements and sometimes they are really shallow. Personally I've not been able to find ways to get strong ideas of how to forecast which is more likely. It tends to be an area I lose money and one I continue to work on trying to develop better ways of dealing with.

Here are examples of each type from trades I've taken recently.


https://preview.redd.it/6n0x4k43cth31.png?width=744&format=png&auto=webp&s=f03fdbff3176e1df36727f3606dbf6fc67912e53
This is explained in more context at https://www.reddit.com/Forex/comments/cks8q1/shorting_noobs_problems_proofs_and_fine_tuning/

This chart is messy because a lot of positions are being taken rather than a specific strategy being followed, but as I've explained in the 'Shorting Noobs' series of posts, I am mot interested in trading off the 61.8% fib.


https://preview.redd.it/97cb1x0wcth31.png?width=719&format=png&auto=webp&s=d49bbac385242184d9f9ba2708d1e9fe92efba42
Here is one with EURUSD that had very shallow sell-off then made the ping swing.

https://preview.redd.it/dbiujru0fth31.png?width=1025&format=png&auto=webp&s=277682a868af7cb2dc2b612243a8abfef54e9de0
You maybe thinking at this point, "But the range bit looks like it should be the 5". I know! I told you it's a bitch. As you can see here regardless of this I have still sold the best price. I am doing this by having a clear SR level I am forecasting in this sort of move. (Explained in more detail in the shorting noob series [2] [3] )
Note, it is still entirely possible that this can make another ping swing and slightly spike out this high. If it does, we have a great opportunity. At this point, we are wiser to look for the better RR trade with trend continuation by considering we are possibly in this part of the move and we have the next (usually stronger than previous) sell off coming.


https://preview.redd.it/15xd09pzfth31.png?width=730&format=png&auto=webp&s=c5e3a70fbc9411b36d74a7e32ebf5c1aabf1ad05

Which actually fits inside another cycle for a ping swing.

https://preview.redd.it/31craqbkgth31.png?width=1018&format=png&auto=webp&s=4d7cc139aa406673213c62009220a3182e7e9e55

Here is a real time forecast of a ping swing we can watch for and set pending orders (or define areas to watch for reversal patterns)

GBPUSD

https://preview.redd.it/uz93cn53ith31.png?width=1082&format=png&auto=webp&s=3b2d9a7fc12c961dafb7ee3cc7aa4c1aec29c927
(Ignore the buy trades on this, they are from a different type of strategy)

This is a lot of information, and to intrinsically understand this you'd have to go over a lot of trending charts and watch how they have developed. I have spent a hell of a lot of time on this. I will round up with leaving you just a few simple rules we can take from understanding this general pattern that recurs in trends. Some of them will help you win, others will help to prevent you losing.

1 - When it starts to chop, it's time to stop.

When a trend that has been in a free flowing form starts to get choppy, it's time to stop following the trend for the time being. You should be aware the next breakout(s) can be false ones, and the next shallow correction for a "Retest & continue" type trade is likely a trap.

2 - Big corrections rarely feature only one leg.

When you see a really big move against the trend it gets really tempting to rejoin the trend once it starts to form price action reversal candles. Any time you're entering without the market having previously faked and then spiked out early sellers at least a couple of times, you have a more risky trade.

3 - Forecast where early sellers will lose.

Quite simply, if you see a downtrend and then a spike up and what looks like the continuation of a downtrend you can assume there are sellers into what they think will be the new downtrend move. It's also quite likely these sellers have it very wrong on their stop area. It will be just above the previous highs and the consolation range. This is the very area we'd expect the ping swing to spike into and then make the proper trend move after whipsawing those who sold too early.
Where they are getting stopped out, you want to be entering. Not sure where this is? Look in Forex forums, they'll tell you.

4 - Velocity does not mean victory!

As price comes into the reversal area it will usually be carrying a lot of short term momentum and moving fast. Moving quickly into an area is not in any way an indication of a break of that area or a reversal. In fact, once you've identified where you think the ping swing will end, the more parabolic that move is into that area the better for the reversal trade. Plan ahead, do not be caught up in the moment. The moment will be deceptive.

5 - Have excellent exit plans on both sides of this sort of move.

If the move fails, the counter move running against you can be persistent. Stop losses should be around 78% of the swing. Small spike outs of the 61.8% level are to be expected. Breaks of the 76% level are not. Similarly, profits can come lightening quickly. Which can actually be a problem if you've not planned the areas you want to exit or how to trail your stops. So be well prepared to exit before you enter.


The things I have explained in this post have validity on all timeframes. I scalp with it, and I swing with it. It transfers readily to any market with trending properties. If you were to master this (especially at an intraday level - which is harder) , it would be highly likely you significantly beat what most people would think are "good returns" when the markets are trending.
It would be possible for someone who has sufficient skill in doing this to make themselves substantial profits even starting from a small amount of money and using moderate risk over the course of just trading 4 - 5 major trend moves on daily and weekly charts. This is quite an easy setup in my opinion (once it's been highlighted at least) and for as long as you can find trends to use it, it will outperform most strategies I see on public display.

(All bets are off in ranges. This will make a mockery of you if you try to do it in ranges)

Happy trend following :)
submitted by whatthefx to Forex [link] [comments]

Shorting Noobs - Purpose of Posts and Consolidation of What We've Covered

Shorting Noobs - Purpose of Posts and Consolidation of What We've Covered
Part [1] [2] [3] [4] [5]
I wanted to take some time to explain my purpose in posting this "Shorting Noobs" series here. In the posts, specifically. I've explained my theory for doing the project itself enough in Q/A in comments.

First let's cover a few things I am not here to do;

1 - Cocaine. Nasty habit.

2 - Undermine, mock or disrespect people new or losing in Forex
I hope this is apparent from my general tone in posts and answering questions. I do not think I am better than you, I know statistically speaking I do this a lot more than most of you. There are things you will be amazing in that I am a noob, it's really only a matter of time and focus. I do not use it as any sort of slur.

3 - Undermine people offering copy trading services
To be honest, I kinda like them. To see how others trade, especially if they do is systematically is fascinating to me. Much can be learned. I value watching people trade higher than airy statements about trading ideals, it gives real information.

4 - Promote Excessive Risk
Although there have been big swings in the strategy, this has not been me trying to ram the virtues of reckless risk down your throat. I recommend it only as part of a balanced diet. The strategy takes a lot of risk because what it is doing (lots of trade data from many sources). Not what I am doing, or suggesting you do.

5 - Sell Anything
I am not marketing any of the strategies I document. You will not be able to get software from me. I do not sell training. Already many people have asked me for training in DMs, and will be able to vouch I have no sales pitch (usually not even a direct answer, just a nudge in the suitable direction).


Now let's talk about what it is about.

I'll do this by sharing a couple DMs I have got.


https://preview.redd.it/oof1l8hm4ci31.png?width=664&format=png&auto=webp&s=532e151f0e9d4d429e1e7e67815b2dd1aec73390

https://preview.redd.it/59k5ug1u4ci31.png?width=681&format=png&auto=webp&s=c0ab733afceab61614313e4379b9a3cac9c4ed12

Firstly, thank you to those who've sent these sorts of messages (if you've messaged me and not heard back in 2 days, please message me again - I'll reply, but keeping up with them is tricky). The fact that when I explain some logical things you can go and test independent of me and come to your own truth on the matter validates this is worth the time and effort. This is what I want you to do. Not believe me. Not buy my hype. Check your own trades against what I highlight.

I think the whole "should I short myself" topic is too long to be included in this post properly. Short answer I'd give is no. There's a far longer one. For brevity, what you should seek to do is understand the triggers for you making losing trades. The triggers for losing entries are also triggers for winning entries. Understand them and re-wire the way you think about the market.

I want to show you that mistakes people make are predictable. I think they are so predictable that I can reduce it to working out what strategy type Timmy is trading, and then "Activate Timmy" at a time I know that strategy is prone to loss, and rack up profits in his drawn down. I also want to show you that what I do does not "break" when there is a news event. It frequently compliments it and my qualifiers foreshadow it.

I want you to understand that as a way to offer you a form of empowerment in the markets. For as long as you believe we are at the whip and whim of these things we can never understand, you're driftwood in the waves. Where others find their excuses, I have found patterns. Where many of you have your frustrations is the root of my fortunes, and I am not smarter than you. I want to stress that. I'm average, but pedantic about precision and this is my job that I do every day.

I will now round up analysis and lessons from posts over the last week or so to consolidate a lesson for you that offers you the chance to instantly improve poor trading results. I'll show you how;

1 - How I explained the type of trading error theoretically.
2 - How I flagged up someone making the trading error in real time.
3 - How I profited from the other side of the trading error, and posted that forecast.

Mistake types:

https://preview.redd.it/cz8wcjna8ci31.png?width=722&format=png&auto=webp&s=55291f94a08c7c75fc240e2a4bbe145fffd6f34b
Full post

We are going to be looking at the area when downtrend turned to correction. We'll used GBPUSD as an example. My post is timestamped, you can see I posted these common mistakes we should look for longer before the GBPUSD price action I will reference. This is not retroactive curve fitting.
Someone posted a sell setup in here on GBPUSD. By up-vote court, trend continuation was the way to go. Unfortunately the poster later deleted their post, so I can not show you specifically the type of analysis they used. I'll say it was good analysis, 2/3 times. This was the 3.
My reply.

https://preview.redd.it/4rubru039ci31.png?width=729&format=png&auto=webp&s=2320150755da871be7bf506db9af34f686c00e3a
Trades

https://preview.redd.it/zzpznz979ci31.png?width=813&format=png&auto=webp&s=c961cc7d427b2753c25c03f345baecee4d9c88ba
Area they posted their sell analysis stating something to the effect the trend was down and there'd been a big correction. We can sell now, it might go up a little more but it's due a drop (I.e, Break&Re-test trade)

https://preview.redd.it/vbvt69lj9ci31.png?width=693&format=png&auto=webp&s=ece654e53d15e0f6412cdc71e71c2899fbc19ea2

I'd call this a foreseeable mistake, and good opportunity to trade the other way when you understand the mistake. That's what I'd describe the mid week action as.

However, word on the street is ...

https://preview.redd.it/h6kvwdknaci31.png?width=703&format=png&auto=webp&s=d7e07d060f714518781a9853be05a09fd41f3ea3
I sure didn't see that coming. Draw your own conclusions.

Following this move, I then posted this analysis. In the analysis I explained the 50/61.8 trap (see [2] [3])

Someone replied this (I'm not "calling out" this person. I hope they take this for what it is, and me just showing what people think vrs what happens, and how this can be 'known').


https://preview.redd.it/vcuftml3bci31.png?width=730&format=png&auto=webp&s=9e75b04752ae9f159dd63fce004d950c84d46fa3
As well as explaining the trap type, the moves to avoid, the scalp possible in the immediate term and sort of price action to expect in a reversal (all just stuff to explain not making selling mistakes on this known mistake area), I also used another strategy to post where the buy for the run to the 61.8 area where be.


https://preview.redd.it/0wmlr6nibci31.png?width=726&format=png&auto=webp&s=dc9af6aaf04028be190ec7abfe177038aac64fa3
Full post https://www.reddit.com/Forex/comments/cu8d23/strategy_to_make_50_100_a_year_trading_one_day_a/

Then I bought at that level, posted we should expect a big pull back and re-load for further swing highs.

https://preview.redd.it/cbi0s2ytbci31.png?width=995&format=png&auto=webp&s=a594c9f3563c235845c40e95ba6d122b29b0c869
Full post https://www.reddit.com/Forex/comments/cufic1/strat_for_50_100_a_year_more_details_first_trade/

I posted my further entries in real time.

https://preview.redd.it/33ymy0p6cci31.png?width=625&format=png&auto=webp&s=95659d006d9e501d0e31c80f0a7e02be68944dd6
Which were profitable.
https://preview.redd.it/4xogetkccci31.png?width=491&format=png&auto=webp&s=100dd5d7344e58f721c37278c29fce6fdb3f0afe
Full post https://www.reddit.com/Forex/comments/cujxgo/strat_for_50_100_a_year_common_points_example_of/

Through all of this, the market went about 10 pips against me in mid week trades, and then under 2 pips against me in all of my trades for today. When I entered, things just worked. Almost as if I 'knew' ... but there's no way that would be possible.
A person could not know on Tuesday what would happen the next days ...

https://preview.redd.it/ralxj9zscci31.png?width=813&format=png&auto=webp&s=33ec9f5fe6557b2e41d04114568043c6eeca55cf
A person could not tell you in the Asia session what to expect hour by hour in the coming trading day ...

https://preview.redd.it/gg09ufizcci31.png?width=742&format=png&auto=webp&s=dd56093469b6ef9c17ae73daf04b1aef7115b876
A person could not draw tomorrows chart ...

https://preview.redd.it/w32v079adci31.png?width=814&format=png&auto=webp&s=01077c65ffbce184f2759957e81343b200fcbf1e

https://preview.redd.it/ef23h3bedci31.png?width=530&format=png&auto=webp&s=3b396b20a18b612ea299bf993f928513cc93f7b7
Full post for all above

And of course, we know above all else ... No one can time the market.

https://preview.redd.it/gnt7wutqdci31.png?width=708&format=png&auto=webp&s=36c60b303a8f69eaeb07140e6f4d8a56193eab42

https://preview.redd.it/tkkzekb2eci31.png?width=713&format=png&auto=webp&s=a816b96eb85d6fdb75ae7b9ac057a3062f88825f


What are the purpose of my posts here?

Just wanted to add a different perspective.
submitted by whatthefx to Forex [link] [comments]

Shorting Noobs - Common Trend Following Mistakes I'm Trading Against.

Shorting Noobs - Common Trend Following Mistakes I'm Trading Against.
Part [1] [2] [3]

Not much in terms of adjustments to add from previous post. I'm going to implement all risk adjustments at the weekend. In the meantime I've used some manual hedging to prevent from over exposure.
In this post I'll talk more about the ideal trades I am looking for. The mistakes people make at these areas, and how to build forward looking trade plans so you are less likely to find yourself caught in one of these market traps. I do consider these to be traps. I think price routinely moves in ways that induce market participants to take losing positions. I think this is done in algorithmic fashion and this means it leaves clues in forms of recurring ways laying traps.
This is just an opinion. I don't know.

First we will examine the classic structure of a trend. All examples will use a downtrend.

Basic Recurring Trend Structure:

Basic Trend Structure

Most of you will have seen this before, and probably recognise it as Elliot Wave theory (EWT). Whether or not you think EWT is valid or not, there are some things I think all of us can agree on. That is for the market to be in a downtrend, it has to keep making new lows. If it doesn't, it's not in a downtrend anymore. You'll also probably agree there are retraces in moves. That not often are new lows consistently made without any retrace. In a broad sense, this is all EWT is describing, which makes it noteworthy in good trending conditions.

Here are the points where most mistakes are made by traders in EWT cycles.


Trend Best/Worst Entries

All areas marked off in orange are places where it's easy to make mistakes.

Looking closer, this is what the more detailed price action on these sorts of moves tend to look like on lower timeframes.


Detailed Best/Worst Entries

Brown boxes are where buying mistakes are made. Purple circles are where selling mistakes are made.
We'll look a bit closer at what the specific mistakes are usually based on (conventional technical analysis theories) soon. First here is an example of this on a real AUDUSD chart.


AUDUSD Example Chart
This is a 45 minute chart, so the swings are not as detailed as the ones I've drawn (mine are more like 15 min), but you should be able to see how this concept can be transferred over onto a real chart. All of us who have been trading for a while know there are times we have made these mistakes. Everyone has ended up selling the bottom pip, or getting stopped out right before it reversed. Many of these times (in a trending market) fit into these areas.
This is not just curve fitting. Using rules to help to describe these conditions to pick the best trades and trading against the trades strategy providers offer, I picked up these trades. This was not perfect, what I'm doing needs a lot of work.

AUDUSD Trade

Here we can see a couple few of the mistakes. The green lines are profits and orange lines are losses. Here shorting these mistakes has done quite well on the spike out low. It's hard to see, but it also got a lot of good buys at the low. There are some losses at the high, but there is a far larger position accumulated around the mistake level.

AUDUSD Result
See previous analysis on these trades in [2] [3]
A big trend leg followed this build up of positions and hit take profits where stops were set under the low. This is where people start to sell, but this is also usually a mistake to sell immediately after this breakout.

The types of mistakes made are due to a handful of concepts. Here I've numbered them.

Mistake Types
Rules/Rational people have in mind making these mistakes.

1 - Breakout/new high relative to recent leg / stops above previous high on sell/ previous low on buy.
2 - Single candle price action mistake.
3 - Breakout trading rushing in / stops go under recent supports/ over recent resistance.
4 - Break and retest.
5 - Deep correction.

Everything listed above has the potential to be very useful and valid in a technical analysis based strategy. However, in some contexts they are literally the very worst thing you can do. That's the thing about trading, you can do the same thing at different times and get wildly different results. What I'm trying to do here is not find people who lose every trade (I want them to win overall, actually. So I can keep copying them). I just want to work out ways to bet against mistakes they are likely to make. I think people will make these mistakes more reliably than an automated system will pick up trades.
I should add that most of these areas the mistakes happen at will be hit with a lot of velocity. This I think is what triggers the mistakes from so many impulsive traders. The market will amble along in a slow non-threatening / uninteresting sort of way, then suddenly all in a rush make these moves that imply something BIG is happening in a certain direction, when actually it's just about to move against these very positions if you take them. Velocity is one of my key filters.

Let's talk about the end of the two leg correction, this is one of the places I think most of the money is made and lost. At this point in an EWT cycle, the market is gearing up to enter it's strongest move. The best move to trade, and the smart market is going to need to get people on the wrong side. This is usually achieved with three things. One, the market makes it's first false reversal from a 50% retrace, and then moves with a lot of velocity into the 61.8% fib (briefly described in [2]). Then there's a second false breakout with price trading a little over the 61.8%, followed by a price crash into new lows.
The interesting thing about this move is if you speak to anyone with any sort of interest in EWT, they will tell you this move often completes with a news spike. There is positive news, the market moves quickly in the direction it "should" and then quickly makes a rapid reversal. Sometimes the move on the news makes absolutely no sense what-so-ever fundamentally. but does strike these areas.
Here is the Brexit chart.
Brexit trend continuation from 61.8% spike out pattern

Let's go further back.

Scotland Vote High
Here is where GBP made it's high point. This was after the fantastic fundamental news (apparently) that Scotland was staying in the UK. Price shot up, then began to heavily downtrend. I've marked in the start to the previous swing with a line, if you check these fibs you'll see it fits with the mistake. We are now in the part of cycle where GBP is aggressive pulling away from the range where the false reversals happened. This is punishing those who bought in this range, and we should expect to see it end in a violent spike down. Remember the people who thought buying Sterling after Brexit was free money? Nah uh.
This happens a lot. When it happens I see people trying to explain it with all sorts of theories. Usually involving the saying "priced in already". People often refer to these in aloof and vague ways, as if there was no way we could have ever known, and it's certainly not worth trying to forecast these sorts of things ... but next time you see this, have a quick check and see if we happened to be in a correction that spiked out a 50% high and reversed around 61.8%. It is wiser to look at what happened than take wild guesses as to why. I am not saying that it always it, nor am I saying it works like magic. I'm just saying it can be quantified. When someone says, "Well you see it was not what was said, or the number, but what was inferred ...", really means nothing. It's an opinion. We're better to look for things we can test, in my view at least.

So, let me talk you through the mental mindset of people when they're making these mistakes. I'm going to use this big Sterling chart, so this will also be a bit of a price forecast.


Mistakes Thinking Patterns.
1 - Price has been going up strongly, it's retraced and there is a single candle PA buy signal. Sets people up to take a horrible trade.
2 - Price has been falling hard and made yet another breakout, it's an easy sell ...
3 - This has fell too far, it's a reversal now. Look how strong it is.
4 - This is a strong breakout and this must be the start of a bigger move.
5 - Wow, it's broke the lows and look how hard it's falling, big sell time.

I think we will see stage 5 complete around 1.190. I think we may be due a fast move into this. Maybe in the coming week or two. It would be typical of the spike nature of end of this sort of move that this will be a single candle of over 150 pips that fills this. Being and holding GBPUSD shorts targeting 1.196 seems a great idea to me.

These five mistakes, made at these handful of areas are the ones I wanting to trade against, and if you'd like to be a profitable trader, are the places you should be looking for entries.
submitted by whatthefx to Forex [link] [comments]

Cryptocurrency price analysis: waiting for a new rise

Cryptocurrency price analysis: waiting for a new rise

https://preview.redd.it/2bx1unugrpv31.png?width=900&format=png&auto=webp&s=7d5d842ae15e44eb592010bbf6c985cd519e0433
Leading RoboForex analyst Dmitry Gurkovsky tells about further possible scenarios of bitcoin price movement and several popular altcoins.
Buyers managed to show a good rebound up. At the moment, assets such as bitcoin and Bitcoin Cash look very interesting in the context of continued growth. Moreover, if the BCH/USD chart shows the formation of a reversal pattern inverted "Head and shoulders" in favor of growth, then BTC is still preparing to leave the channel and continue a confident upward movement.
Unfortunately, Ethereum, Litecoin and EOS assets are still under pressure. There are several signals from the daily charts in favor of a downward movement. However, if the bulls manage to break through the nearest resistance levels, then these assets will be ready to move to a phase of sustainable growth.
In General, the cryptocurrency market looks ready for the beginning of a new wave of growth. The bulls can only hold the current levels and rise a little higher to deprive the bears of all chances to continue the downward correction.

Bitcoin

Quotes showed an aggressive rebound from the support level. However, the price tested resistance in the form of a downtrend near the $9800 area. For a full extension of the lifting by the buyer it is important to "push out" rates are even higher.
A good signal in favor of the likely continuation of growth is the breakdown of the downward trend line on the RSI indicator. In most cases, there is a return to the broken line, after which we should expect continued growth. As the main trading idea, you can take a slight correction to the level of $7700, after which you can talk about a rebound and an upward movement.
The cancellation of this option would be the drop in prices of digital asset below $6875, which indicates a breakout of the lower border of the channel and continue falling.
Daily BTC/USD chart from TradingView
On the 4-hour chart, cryptocurrency quotes were able to leave the limits of the short-term downward channel. This signal is the first sign of a potential reversal of the current downward correction. However, confirmation of the completion of the fall will be a strong growth with a consolidation above the level of $10,995, which will indicate an exit beyond the downward channel. In this case, the target of the movement will be the $12,405 area.
The RSI indicator values again pushed off from the resistance level, so we should expect a decrease and a test of the broken channel border. After this movement, we can talk about the beginning of growth to the target at $10,995.

Four-hour BTC/USD chart from TradingView

Ethereum

Ethereum buyers also managed to keep quotes in the support area, which is located at $147. At the moment, the price has once again returned to the area between the moving averages, which may provoke an attempt to further decline.
In favor of this option is a rebound from the downward resistance line on the RSI indicator. As the main idea, we should expect a rebound from the lower border of the ascending channel and a continuation of the fall to the first target at $147. Its breakdown will open the way for the movement of quotations to the level of $100. The cancellation of the negative option will be the breakdown of the Moving averages and the consolidation of ETH/USB above the level of $239. In this case, we can talk about the continuation of the rise to the goal at $280.
Daily EUUSD chart from TradingView
On the 4-hour chart, the quotes are clamped within the descending channel. The RSI indicator values again test the resistance line, so we should expect a rebound and a fall in the quotes of the digital asset to the level of $150. In favor of this option, the upper limit of the descending channel will also be tested. The cancellation of the proposed forecast will be the breakdown of the resistance level and consolidation above $202, which will indicate the exit of quotations beyond the ascending channel. In this case, the goal of the rise will be the level of $239.
Four-hour EUUSD chart from TradingView

Litecoin

On the daily chart, the RSI indicator values test the resistance line. It is premature to talk about a reversal — as we can see, the pressure from the sellers remains. Moving averages also indicate a bearish trend. There are risks to see a rebound from the resistance level and another attempt to fall to the level of $41.
The cancellation of the negative option for the bulls will be a strong growth with a breakdown of the level of $79, which will indicate the return of quotes inside the ascending channel and the continuation of the rise to the first target at $107.
Daily LTC/USD chart from TradingView
At smaller time intervals Litecoin tests the upper boundary of the descending channel. As you can see, prices are repelled from the level of $64. The RSI indicator values here also tested the resistance line. As the main option, we should expect a fall to the level of $41. The cancellation of such a scenario will be the breakdown of the upper border of the descending channel. In this case, the growth target should be considered the $79 area.
TradingView's four-hour LTC/USD chart

EOS

EOS buyers are trying to turn the tide in favor of growth. However, here on the daily chart, the RSI indicator values test the resistance line. Previously, we have already seen a rebound from it, so while the values are lower, we should expect a fall in quotations.
The immediate target of the decline may be the area at the level of $2, the breakdown of which will indicate a movement to the level of $1.45. The cancellation of the option with a decrease will be a strong rise in the value of EOS and the consolidation of the asset price above the level of $4.29, which will also provoke a breakdown of the resistance line by the values of the RSI indicator. In this case, the growth target may be the $5.35 area.
Daily EUUSD chart from TradingView
At small time intervals, the quotes pushed off from the upper border of the descending channel. If the bears manage to increase the pressure, the $2.06 and $1.45 levels may be the target of the fall. In favor of this option, the resistance line test on the RSI indicator also speaks.
Confirmation of the fall will be the consolidation of EOS quotes under the level of $2.97. The cancellation of this scenario will be the breakdown of the upper border of the descending channel. In this case, the growth target will be $4.29 and $5.35.
Four-hour EUUSD chart from TradingView

Bitcoin Cash

On the daily chart, buyers managed to break through the downtrend line. The value of the RSI indicator has also strengthened above the resistance line. All these signals point to a potential continuation of growth towards the first target at $355. The breakdown of this area will give impetus to the movement to the level of $457.
However, we should not exclude the development of a minor correction with the test of a broken trend line on the RSI indicator. The target of the correction may be the $245 area. The cancellation of the option with growth will be the fall and breakdown of the local minimum with the consolidation of quotations under the level of $200. In this case, we should expect a decline in the price to the level of $165.45.
Daily BCH/USD chart from TradingView
On the 4-hour chart, the quotes also fixed above the short-term descending channel. It is not necessary to exclude attempts of formation of the inverted model "Head and shoulders". As you can see, the price is enough to fall to the level of $245 to complete the formation of the right" shoulder " of the model, after which we should expect the beginning of a strong growth.
A good signal for the continuation of the rise will be the consolidation of the price above the level of $335.2. Cancellation option growth will drop and the breakdown of support level with closing prices below the level of $199, which is expected to continue falling.
TradingView's four-hour BCH/USD chart
submitted by AVAY11 to u/AVAY11 [link] [comments]

[educational] Technical analysis, patterns, and charts analysis for the day trader

[educational] Technical analysis, patterns, and charts analysis for the day trader
Chart patterns form a key part of day trading. Candlestick and other charts produce frequent signals that cut through price action “noise”.
The best patterns will be those that can form the backbone of a profitable day trading strategy, whether trading stocks, cryptocurrency of forex pairs.
Every day you have to choose between hundreds of trading opportunities. This is a result of a wide range of factors influencing the market. Day trading patterns enable you to decipher the multitude of options and motivations – from hope of gain and fear of loss, to short-covering, stop-loss triggers, hedging, tax consequences and plenty more.
Candlestick patterns help by painting a clear picture, and flagging up trading signals and signs of future price movements. Whilst it’s said you’ll need to use technical analysis to succeed day trading with candlestick and other patterns, it’s important to note utilizing them to your advantage is more of an art form than a rigid science.
You have to learn the power of chart patterns and the theory that governs them in order to identify the best patterns to supplement your trading style and strategies.

Use In Day Trading

Used correctly trading patterns can add a powerful tool to your arsenal. This is because history has a habit of repeating itself and the financial markets are no exception. This repetition can help you identify opportunities and anticipate potential pitfalls.
RSI, volume, plus support and resistance levels all aide your technical analysis when you’re trading. But crypto chart patterns play a crucial role in identifying breakouts and trend reversals. Mastering the art of reading these patterns will help you make smarter trades and bolster your profits, as highlighted in the highly regarded, ‘stock patterns for day trading’, by Barry Rudd.

Breakouts & Reversals

In the patterns and charts below you’ll see two recurring themes, breakouts and reversals.
  • Breakout – A breakout is simply when the price clears a specified critical level on your chart. This level could by any number of things, from a Fibonacci level, to support, resistance or trend lines.
  • Reversal – A reversal is simply a change in direction of a price trend. That change could be either positive or negative against the prevailing trend. You may also hear it called a ‘rally’, ‘correction’, or ‘trend reversal’.

Candlestick Charts

Candlestick charts are a technical tool at your disposal. They consolidate data within given time frames into single bars. Not only are the patterns relatively straightforward to interpret, but trading with candle patterns can help you attain that competitive edge over the rest of the market.
They first originated in the 18th century where they were used by Japanese rice traders. Since Steve Nison introduced them to the West with his 1991 book ‘Japanese Candlestick Charting Techniques’, their popularity has surged.
Below is a break down of three of the most popular candlestick patterns used for day trading.

Shooting Star Candlestick

This is often one of the first you see when you open a chart with candlestick patterns. This bearish reversal candlestick suggests a peak. It is precisely the opposite of a hammer candle. It won’t form until at least three subsequent green candles have materialized. This will indicate an increase in price and demand. Usually, buyers lose their cool and clamber for the price to increasing highs before they realize they’ve overpaid.
The upper shadow is usually twice the size of the body. This tells you the last frantic buyers have entered trading just as those that have turned a profit have off-loaded their positions. Short-sellers then usually force the price down to the close of the candle either near or below the open. This traps the late arrivals who pushed the price high. Panic often kicks in at this point as those late arrivals swiftly exit their positions.

https://preview.redd.it/gf5dwjhbrdh31.png?width=300&format=png&auto=webp&s=437ff856bfd6ebc95da34528462ba224d964f01f

Doji Candlestick

One of the most popular candlestick patterns for trading forex is the doji candlestick (doji signifies indecision). This reversal pattern is either bearish or bullish depending on the previous candles. It will have nearly, or the same open and closing price with long shadows. It may look like a cross, but it can have an extremely small body. You will often get an indicator as to which way the reversal will head from the previous candles.
If you see previous candles are bullish, you can anticipate the next one near the underneath of the body low will trigger a short/sell signal when the doji lows break. You’ll then see trail stops above the doji highs.
Alternatively, if the previous candles are bearish then the doji will probably form a bullish reversal. Above the candlestick high, long triggers usually form with a trail stop directly under the doji low.
These candlestick patterns could be used for intraday trading with forex, stocks, cryptocurrencies and any number of other assets. But using candlestick patterns for trading interpretations requires experience, so practice on a demo account before you put real money on the line.

https://preview.redd.it/4yo650lcrdh31.png?width=300&format=png&auto=webp&s=b2aa3cdeef23e44e1e3e3047bbe2604fce0a4768

Hammer Candlestick

This is a bullish reversal candlestick. You can use this candlestick to establish capitulation bottoms. These are then normally followed by a price bump, allowing you to enter a long position.
The hammer candlestick forms at the end of a downtrend and suggests a near-term price bottom. The lower shadow is made by a new low in the downtrend pattern that then closes back near the open. The tail (lower shadow), must be a minimum of twice the size of the actual body.
The tails are those that stopped out as shorts started to cover their positions and those looking for a bargain decided to feast. Volume can also help hammer home the candle. To be certain it is a hammer candle, check where the next candle closes. It must close above the hammer candle low.
Trading with Japanese candlestick patterns has become increasingly popular in recent decades, as a result of the easy to glean and detailed information they provide. This makes them ideal for charts for beginners to get familiar with.

https://preview.redd.it/7snzz8qdrdh31.png?width=300&format=png&auto=webp&s=f83ff82f0980dd30c33bc6886ae7e7ed3a98b72f

More Popular Day Trading Patterns

Using Price Action

Many strategies using simple price action patterns are mistakenly thought to be too basic to yield significant profits. Yet price action strategies are often straightforward to employ and effective, making them ideal for both beginners and experienced traders.
Put simply, price action is how the price is likely to respond at certain levels of resistance or support. Using price action patterns from pdfs and charts will help you identify both swings and trendlines.
Whether you’re day trading stocks or forex or crypto with price patterns, these easy to follow strategies can be applied across the board.

Zone Strategy

So, how do you start day trading with short-term price patterns? you will likely employ a ‘zone strategy’. One obvious bonus to this system is it creates straightforward charts, free from complex indicators and distractions.

https://preview.redd.it/7e5x37zerdh31.png?width=300&format=png&auto=webp&s=2098a4c9df4a4556c3024cec1c176ce50c9806c0

Dead Zone

This empty zone tells you that the price action isn’t headed anywhere. There is no clear up or down trend, the market is at a standoff. If you want big profits, avoid the dead zone completely. No indicator will help you makes thousands of pips here.

The Red Zone

This is where things start to get a little interesting. Once you’re in the red zone the end goal is in sight, and that one hundred pip winner within reach. For example, if the price hits the red zone and continues to the upside, you might want to make a buy trade. It could be giving you higher highs and an indication that it will become an uptrend.
This will be likely when the sellers take hold. If the price hits the red zone and continues to the downside, a sell trade may be on the cards. You’d have new lower lows and a suggestion that it will become a downtrend.

The End Zone

This is where the magic happens. With this strategy, you want to consistently get from the red zone to the end zone. Draw rectangles on your charts like the ones found in the example. Then only trade the zones. If you draw the red zones anywhere from 10-20 pips wide, you’ll have room for the price action to do its usual retracement before heading to the downside or upside.

Outside Bar At Resistance Or Support

You’ll see a bullish outside bar if today’s low exceeded yesterdays, but the stock still rallies and closes above yesterday’s high. If the complete opposite price action took place, you’d have yourself the perfect bearish example.
Unfortunately, it isn’t as straightforward as identifying an outside candlestick and then just placing a trade. It’s prudent to find an outside day after a major break of a trend.

https://preview.redd.it/egb0lp6grdh31.png?width=300&format=png&auto=webp&s=b0170eceea5006464e5832bc3a9083c72ee677ad

Spring At Support

The spring is when the stock tests the low of a range, but then swiftly comes back into trading zone and sets off a new trend. One common mistake traders make is waiting for the last swing low to be reached. However, as you’ve probably realized already, trading setups don’t usually meet your precise requirements so don’t stress about a few pennies.

https://preview.redd.it/q82lap2hrdh31.png?width=300&format=png&auto=webp&s=9e40f0bc25c2df06a1d93edb68b293c858a32592

Little To No Price Retracement

Put simply, less retracement is proof the primary trend is robust and probably going to continue. Forget about coughing up on the numerous Fibonacci retracement levels. The main thing to remember is that you want the retracement to be less than 38.2%. This means even when today’s asset tests the previous swing, you’ll have a greater chance that the breakout will either hold or continue towards the direction of the primary trend.

https://preview.redd.it/ey997b2irdh31.png?width=300&format=png&auto=webp&s=c938aac51e3b3bbf1f45a11c46f4ae3dfd1b6dd4
Trading with price patterns to hand enables you to try any of these strategies. Find the one that fits in with your individual trading style. Remember, you’ll often find the best trading chart patterns aren’t overly complex, instead they paint a clear picture using minimal indicators, reducing the likelihood of mistakes and distraction.

Consider Time Frames

When you start trading with your short term price patterns pdf to hand, it’s essential you also consider time frames in your calculations. In your market, you’ll find a number of time frames simultaneously co-existing. This means you can find conflicting trends within the particular asset your trading. Your stock could be in a primary downtrend whilst also being in an intermediate short-term uptrend.
Many traders make the mistake of focusing on a specific time frame and ignoring the underlying influential primary trend. Usually, the longer the time frame the more reliable the signals. When you reduce your time frames you’ll be distracted by false moves and noise.
Many traders download examples of short-term price patterns but overlook the underlying primary trend, do not make this mistake. You should trade-off 15-minute charts, but utilize 60-minute charts to define the primary trend and 5-minute charts to establish the short-term trend.

Wrapping Up

Our understanding of chart patterns has come along way since the initial 1932 work of Richard Schabacker in ‘Technical Analysis and Stock Market Profits’. Schabacker asserted then, ‘any general stock chart is a combination of countless different patterns and its accurate analysis depends upon constant study, long experience and knowledge of all the fine points, both technical and fundamental…’ So whilst there is an abundance of patterns out there, remember accurate analysis and sustained practice is required to fully reap their benefits.

The source : https://www.daytrading.com/patterns
submitted by JalelTounsi to ethfinance [link] [comments]

Teach me please :)

Teach me please :)
Hey everyone,
My name is Allen and I am new to Forex trading. I've messed around with trading stocks a year ago, but never got good enough to profitability yet. Now, I want to learn how to trade Forex and hoping I can become profitable through consistency and persistence.
I recently opened a live account and have made 7 trades: 2 wins, 4 losses. I have been trading small and have followed my stop losses so my losses have been small. I am down net -$35 currently. Here are a few of my trades. If anyone has feedback or sees a pattern in my trading that I can improve on, please let me know. I mainly execute trades off when market taps a resistance/support level or EMA line.
Things that I think I need to improve on: 1) Identifying correct market trend
- Ex) sometimes I have trouble figuring out if market is pulling back on a downtrend or starting to create a higher low and reversing

2) Identifying proper entry signals
- I am still working on interpreting price action. I usually enter trades on 15min chart or 1 hour chart. I may need to stop using 15min chart because I get faked out easily from it. One thing I've been implementing and it has helped my patience is waiting for candles to close before assuming market trend. Such as waiting for 15min candle or 1hour candle to close before entering a trade.


Here are some examples of my trades:
1) NZD/USD (Loss) Entry: short 0.65313 Exit: 0.65394
Reason for entry: I thought the market was going to respect the green trend line. Stop loss was right above the trend line. I saw a wick on 15 min chart and a red engulfing candle following it.


1 hour chart

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2) USD/CHF (Loss) Entry: short 1.00876 Exit: 1.00942
Reason for entry: In the 1 hour chart, it broke it's uptrend structure by creating a lower low. It rejected off the .50 level of Fibonacci Retracement, which signaled me that it is possibly going to continue downtrending. Both, 4hour and 1 hour charts were under the 34EMA (orange trend line).
15 min chart


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3) EUNZD (Win) Entry: short 1.71027 Exit: 1.70674 | 1.70884
Reasons for entry: - Market went under key level (orange horizontal line) - Market was under 34EMA (yellow trend line) - Broke through support (white horizontal line)
15 min chart
Where could I have gotten a better entry on this trade? I was negative for a long time until it finally broke the support. What will signal me if the market will be rejected off a resistance level or break through a resistance level?


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4) NZD/USD (Win) Entry: 0.65426 Exit: 0.65335 | 0.65215 | 0.65188
Reasons for entry:
- downward market trend - market rejected off 34EMA trendline (yellow trend line) - big red engulfing candle
https://preview.redd.it/7u6fidd78h131.png?width=1560&format=png&auto=webp&s=701cf325906e056ec5b71544c5bc4895a0117c02
Lessons I learned from this trade: - Be more patient on my take profit. Took first profits out too quickly because it was dropping so quick and I was scared it would bounce back up
- Find better entry
- Similar to the previous trade, I was in the negative for a while before it worked out. Where would be a proper signal for a short? Long wick followed by a red engulfing candle at resistance level?


Sorry for the long post! Hope you learned something from my mistakes and I would greatly appreciate any feedback you guys can give me! I believe forex trading can become the gateway to financial freedom for me and I want to do my best to make it work. I also live in Orange County, CA and wouldn't mind meeting anyone who is in the area to discuss strategies and learn from each other!
Hope everyone has a great night!
submitted by allenaxie to Forex [link] [comments]

Crypto Story Time

Evening all,
 
Slightly different flavour here, which I hope will be insightful to those who take the time to read. Tonight I'm going to talk about my learnings in this market so far; my biggest mistakes; how you can avoid making them yourself; and the strategy I intend to follow from now on. It’s a long old read, but it contains months worth of knowledge, which could only be gained from first-hand experience. So pour yourself a drink, settle in, and let me take you through a brief history of my first two months in crypto.
 

TL;DR: Been in crypto 2 months, after years trading forex. Learnt a lot, and passing on the knowledge. Hope it helps some of you to become better investors.

 

CHAPTER 1: New market; new opportunity

 
I came into crypto with a real excitement. Finally a market that resonates with me. The ability to buy into something I believe in - something that could change the world for the better - and to make money along the way. I was excited that I could apply my trading background, something that not many in the market possess, to my advantage. I was excited at the prospect of being on the curve of early adoption, in a market that had demonstrably meteoric potential. But I was patient. I knew that I would be risking a substantial amount of money in this space, and potentially other peoples’ too, so I had to approach it sensibly. I was going to invest (hold long-term) the vast majority and day trade just a small portion. I spent many weeks researching before considering pulling the trigger even once. I didn’t come into this without a plan. But looking back on it now, it really was only scratching the surface on what a serious investment strategy should be.
 

CHAPTER 2: Early Strategy

 
In brief, my plan was to research a load of coins that I’d heard have good potential – solid projects which make unique & warranted use of blockchain technology; are disruptive to their industry; are developed by a competent & active team; and are backed by a loyal community. I shortlisted maybe 40 coins through articles, videos and general conversation, and I added them to my watchlist. Admittedly I became a bit lax in completing the deep level of research I told myself I’d do for each – scrutinizing the whitepaper became skimming the whitepaper, which then became watching a video analysis, which then became “oh that sounds interesting I’ll keep an eye on it”. But this was just a watchlist. And still an educated one.
 
I knew that I wanted to wait for an inevitable dip in Bitcoin’s value to enter the market, but it just wasn’t coming. $6k, $8k, $10k… the bullish momentum couldn’t be tamed. Was I missing out? Was Bitcoin going to continue its parabolic move while I sit here waiting for a dip that could never come?
 

LEARNING 1: There are an unlimited number of opportunities

 
At this stage I was ready to get involved, and I’d scouted a few alt coins that had good technical entry points approaching. Do I need to keep waiting for a good Bitcoin price even when there’s a good alt price? In short, if you’re confident enough about a trade, it doesn’t really matter what price you pay to get the BTC (or other major alt coin) needed to trade it, as long as you believe that your trade will outweigh any potential drop in Bitcoin’s value. If your trade goes up 100% and BTC’s value drops 50%, at that point you’re break even. Plus if you keep holding and BTC returns back to its previous value, now you’re in 100% profit. For me this meant that even after buying some Bitcoin at its ATH (all-time high) and having it correct over 40%, I was still in profit, because this particular trade was up over 100%. More on this later.
 
So I bought some Bitcoin! Not all at once – generally a decent strategy is called dollar-cost averaging. In essence, buying a little bit every week at whatever the price at the time is, so that your entry price averages out over time. A better strategy is to only buy if it’s at a good price, or when you need it for a trade setup – not just arbitrarily every week even if the price is high. But I digress, I had some Bitcoin now and I wanted to diversify. Time to buy some alts.
 

LEARNING 2: Every trade is a decision to have the coin you’re buying instead of the coin you’re using to buy it

 
If an alt coin is gaining value against Bitcoin, it’s better to be holding that alt coin than Bitcoin. And if it’s losing value against Bitcoin, you’d be better off keeping it as BTC. Simple, but easy to forget when you load up Coinmarketcap and see all of the price changes in USD. You’ve gone up by 4% today – great! But BTC went up 10%, so you’d have been better off holding BTC. Buying a coin is an active decision that you make to hold the coin you’re buying instead of the coin you’re selling for it, for the period of time until you close that position. So if I buy 1000 XEM using BTC, that XEM/BTC trade is me saying “I think that XEM will increase in value at a greater rate than BTC will”. If both of them increase in value but BTC does it faster, that was a sub-optimal decision.
 

LEARNING 3: Satoshis are your friend. Accumulate as many of them as possible

 
So how does one measure profit on a trade? It’s intuitive to think of it in fiat terms – how many £££ did I make? Something tangible. But really everything should be measured in the smallest unit of Bitcoin (1 satoshi = 0.00000001 BTC). It’s easier to migrate to this way of thinking if you think of your total investment as the total amount of BTC (or the other major alt coin) that you were able to buy with it. Say I invested £1000 in crypto, and with that I managed to buy 0.1 BTC – that’s my total investment. If I want to diversify and put 10% of that into each of my favourite alt coins, I’d buy 0.01 BTC worth of each of them. Let’s say Litecoin was one of them and I got 1 LTC for my 0.01 BTC. Litecoin’s rocket then fuelled up and started on its journey to the moon, and I decide to bank my profit. I now trade it back for 0.015 BTC. From 0.01 BTC to 0.015 BTC is a profit of 0.005 BTC, or 500,000 satoshis!
 
“But why not just measure it in £££ - that’s far less complicated?!”
 
Well here’s the kicker. Let’s say Bitcoin’s value plummeted over the course of that trade. I’ve got more BTC, but because the value of each one decreased, I may still have lost money. So does that mean that trade was a bad decision? Not at all. That trade was a decision between BTC and LTC, and you made the right call. LTC held its value better than BTC did, so you would have lost more if you didn’t take the trade. Profit measured in satoshis allows you to strip away the financial layer and answer the most important question – “was it a good decision to make that trade?” A gain in satoshis is always a win. A gain in £££ is not.
 
Taking that same scenario in which I’ve got an equal amount of my 10 favourite alt coins. Let’s say 9 out of 10 of them stay at exactly the same value, but the other one shoots to the moon on a lambo all the way to 100%. Woohoo! Shame that was only 1/10 of my portfolio - overall it’s worth 10% more now – but if I’d have invested all my money in that one coin I’d be up 100% overall. Now I’m certainly not advocating putting all your eggs in one basket. Rather, in reference to my previous learning, this helped me realised another very important point.
 

LEARNING 4: Understanding opportunity cost is a must

 
Any trade I make is not only a decision between the two coins I’m trading; it’s also a decision to buy that coin instead of any of the other coins I might be interested in. I have 0.1 BTC to spend and 10 alts I want to spend it on – should I just divide it equally? Not necessarily. If you’re super confident about a couple of them, but not so much on the others, spreading it equally doesn’t sound like such a good plan after all does it? Take your time analysing each trade / investment and rank them in order of confidence. In order of potential (risk:reward if you’re a trader). Invest more in the ones you’re more confident in. It’s a really basic point, but one that’s so often forgotten when there are so many exciting prospects out there. Holding a particular coin doesn’t just cost the price that you paid for it, it costs the opportunity to buy something else instead. One of the first things I learnt in trading was to cut your losers short and let your winners run. Why should crypto be any different? Even when you’re in a trade, every moment is an active decision to keep holding it instead of trading it for something else. Don’t blindly HODL hoping for a bad decision to improve, when there are better decisions you can take to re-coup that loss. Equally, don’t sell for a loss just because the value goes down. Re-analyse. Has anything changed? If every reason you had to buy it in the first place still applies, HODL. If something’s changed, including your confidence in it compared to other cryptos, consider switching it for a better opportunity.
 
So I learnt all of this in my first month – December 2017. Did I make optimal decisions all the time? Absolutely not, but with cryptos riding to all-time highs, my investors were very happy, as was I. It’s not often that you can get a 100% return on investment in just one month in a market. But it’s easy to profit in a bull market.
 

CHAPTER 3: It’s not all sunshine and lambos

 
It was around the end of December in which things started to get a bit too parabolic, and I was naturally suspicious of how long this could last. But you find yourself, inexperienced in a new market, eager to see how far you can ride the wave. The fear of missing out on further exponential gains becomes as much of a psychological challenge as taking a loss. In short, you get greedy. Highs that I had once been ecstatic with, a few days later became lows. I told my investors not to expect anything like this in future months. In my monthly summary I said “we are in perhaps the most bullish market the world has ever seen”, and I estimated that we had “a maximum of 1-2 more weeks to ride this momentum”. Prophetic, no? Well it’s easy to make predictions that come true – even a broken clock is right twice a day. What’s difficult is having enough conviction to take your own advice.
 

LEARNING 5: Make your rules and stick to them, no matter what

 
This is without a doubt the biggest thing I’ve learnt over the months. If one day you set yourself a target of £X profit – a level you’d be really happy to achieve, be that on a trade or overall – take it. Cash out as soon as you reach it and buy yourself something nice. Make it tangible. It’s easy for the world of online trading to feel gamified, but remember what you’re staking – this is real money. But it’s easier said than done. If you rise suddenly to that target I can tell you your first thought will be “whoa look at it go, I’m gonna see how much further it can get before I cash in”, rather than “mission accomplished, time to get out”. Humans are greedy. We want to take shortcuts – to our dreams, to wealth – but this isn’t a get rich quick scheme. If someone told you they could get you 10%/month gain on your savings (that triples your money every year) you’d probably bite their hand off. So why in crypto would you not be chuffed with 50%, or 20%, or 10%? Don’t move the goalposts. Decide in advance when to take profit and take it.
 
First off, it’s always a good idea to take out your initial investment at a level after which you’d be psychologically happy if the market goes down or up. For example, if I took out my initial investment (say £1000) when it went up 50% to £1500, and then the market went lunar and doubled the next month, I’d personally feel a bit annoyed at myself for not leaving more money in. That £1000 would’ve been £3000 had I kept it invested…shit. However if I took out my initial investment when it went up 200% - I’d now have £2000 left of my £3000 investment, and if it doubled the next month, I’d be happy with the stake I had remaining, not regretting my decision. That level can only be decided by you, based on your attitude towards risk. Obviously the higher that value is before you cash out your profits, the greater the risk you’re taking since it may never reach that level. Taking out your investment as soon as you’re happy to is a good move because from then on in you’re riding on pure profits. If the market were to crash to zero, you’d still be break even, so it’s much easier to detach yourself from the emotions involved (and we all know how emotional this market is). And if you’re a technical trader, rejoice at the fact that this market is hugely technical, and you can very often predict good levels to get out at – often doubled with buying back in cheaper. I highly recommend for everyone to spend some time learning to analyse charts - even at a basic level. It works. And for heaven's sake if you're day trading don't do what I did and "neglect" to apply basic trading principles like setting a stop loss and sizing each position at maximum ~1% risk. You can call it investing; you can call it speculative buying; but at the end of the day that's just gambling. Don't be lazy. Don't be wreckless. Apply what you've learnt in other markets - crypto is no different.
 
And for context, no I did not take my own advice. The correction shocked me. Not the fact that it happened, but the fact that it happened so hard and fast. At first I thought it was a healthy dip, and that the uptrend would resume soon enough – no reason to sell. But then the bears took over, and we were in a full on downwards movement. News emerged from South East Asia which caused a great deal of negative sentiment, and Bitcoin’s value tumbled (even when some of the speculation was later deemed invalid), and with that I realised how inherently linked to Bitcoin that all other cryptocurrencies are. You may dislike Bitcoin - the slow transactions; the high fees – but you can’t argue how critically important it is to this market.
 

LEARNING 6: 40+% market corrections are normal in crypto, but they still hurt

 
I neglected to mention earlier, but I have a background in trading forex. I understand market patterns, cyclicity and technical analysis such as Elliott Wave Theory and Fibonacci ratios. It is foolish to think that charts will continue indefinitely in a given direction – there will always be corrections and reversals. All through the correction we’ve started this year with, I have remained very optimistic. Nothing at all has changed to make any of the leading crypto projects less credible or via as future industry disruptors. This is why it’s important to do your own research on coins you invest in – so that you’re psychologically happy holding them long term through price corrections. But I’ll be honest, when Bitcoin broke down through several technical support levels a few days ago, I became apprehensive. Not even close to panic, or tempted to sell. After all I am investing long term, and I still see this as a requisite correction in a much larger up-trend. Or at least the upside potential of that outcome is comfortably worth the risk for me – it’s the opportunity of a lifetime. But even as an experienced trader, doubts can set in. All of the profits I had gained in month 1 were gone, and I have now slightly dipped into loss. As I say, I’m not selling, and my analysis is still very bullish. But HODLing is not always the best strategy.
 

LEARNING 7: When things are looking bearish, consider the trade to fiat

 
With the benefit of hindsight, and now having dedicated substantially more time to learning Elliot Wave Theory and studying crypto charts, there were a number of points at which you could have predicted a big ol’ correction was on the cards, before it fully developed. A quick ‘n dirty rule of thumb, for those of you who don’t know how to read charts, is: “Don’t buy into a parabolic market or at an all-time high – it’ll likely correct soon”. But I’d also like to add an addendum to what is a common mantra in the crypto community: “Buy the dip” – this is for day trading. If you’re intending to hold a coin long term, zoom right out and look at the entire coin’s price history. Wait for a macro scale correction, not a micro scale dip. A lot of people got excited the other day at Bitcoin rising 10% - I saw tonnes of calls saying “the correction is over” or “Bitcoin to the moon” – but when you zoom out, we’re still in a downtrend with room to go lower, and substantial resistance to get through before we can rise to new highs. Play the long game and look for long-term signals. And if you are in that subset of people who can predict an imminent correction, or indeed if you’re halfway through a correction with a good chance of it continuing, the best decision may well be to get out of the market until it’s over. Trade your positions back to fiat, and wait for clear recovery to the upside. It’s much more difficult to trade profitably in a down-trend. Most of us could have doubled our BTC holdings just by getting out of crypto before the correction and buying back in cheaper now. So make sure you have an exit plan. Know the steps that you’d need to take to get your money off exchanges / wallets and back into your bank account. Getting out of crypto doesn’t have to be a permanent move. There’s no harm in waiting things out until you’re confident again. After all, refer back to Learning 1 – there are always more opportunities.
 

CHAPTER 4: Moving forwards

 
At last, filled with learnings and plenty of inactive time spent refining my strategy, I’ve gone back to my technical analysis roots and really analysed why I’m in my positions.
 

LEARNING 8: Never stop analysing. You will make mistakes. Learn from them.

 
Does my portfolio need to be this diverse? Are my invested amounts proportional to my confidence in them? Probably not, so I’ve taken this opportunity to start shifting around. Don’t be precious about losses – losing is a natural part of trading – you only need one 10:1 winning trade to offset ten losing ones. So take some losses and make some mistakes. I’m sure glad I did, because it’s made me a much more confident and competent investor today.
 
And since everyone always looks around for opinions on the market, I will leave you with one bit of bullish technical insight on our King, Bitcoin. Basic Elliot Wave Theory says that markets move in ebbs and flows – 5 waves in the direction of the trend, followed by 3 waves of correction. And these waves are fractal in nature, meaning that a full 5-wave pattern forms a single larger wave within a higher degree pattern. All that being said, IF Bitcoin’s run up to its ATH in December constitutes a completed 5-wave pattern, we could consider that history as Wave 1 of a larger up-trend. Using Fibonacci extension ratios that appear in all markets (including crypto, very prominently, even with BTC), we can project the likely extensions of the Wave 3 that would come after we’re done correcting here. Based on analysis run by eSignal, a popular trading platform, the length of Wave 3 will likely reach either 1.62, 2.62 or 4.25 times the length of Wave 1. That means our Wave 3 high would take the price of a single Bitcoin to roughly $32,000, $64,000 or $98,000.
 
You can view these Elliot Wave Projections (in GBP) here
 
Technical analysis is very subjective, this is merely one possible outcome. But ask yourself, if you had the chance to invest in something with global reach that could make a 5x or even 10x return on your investment, what would you risk for that opportunity?
 
Thanks for taking the time to read, and I hope this helps some of you.
 
Happy investing, Andy
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Deciphering the Diamond Chart Pattern

Deciphering the Diamond Chart Pattern
Diamond Chart Pattern
The diamond chart pattern is one of the reliable chart patterns mostly used by the day traders to identify the potential uptrend reversals. The bearish diamond’s occurrences are far more prevalent than their bullish counterparts. The diamond pattern has enabled a large number of traders to make quick profits.
Forex trading markets, because of their high liquidity, gives way to more diamond formations than any trading counterpart.
Cutting the Diamond Bear An offset head & shoulders formation is chosen for the trend lines to be sketched. The left shoulder and the head are connected through a straight line. The head is then connected to the peak of the right shoulder. This forms the upper boundary of the diamond. The price must not break the boundary for it to remain in the pattern.
For the lower part, the left shoulder is again connected to the trough formed after the head which is then connected to the right shoulder.
Identification: Diamond vs Head & Shoulders It is not hard to get confused with the pattern of head & shoulders and diamond as they mirror each other. The offset nature of the head & shoulders pattern can be identified by the head located closer to the left shoulder and the tail slightly closer to the right. And the neckline will always struggle to be a straight line.
Entry The right time to take the trade is by the completion of the pattern. The breakdown is most likely to happen right after the formation of the diamond, so shorting at the end of the right shoulder could prove to be beneficial.
Exit The safest exit is marked from the right shoulder with the difference in value between the highest Peak and the deepest crevice within the pattern. The diamond pattern’s breakdown has more profit potential than just the difference between the peak and trough, but, more than that is a risk.
Stop-Loss Stop loss is a counter-measure to limit your losses in case of the failure of your analyzed pattern. It is most advised to place the stop loss at the last peak formed before the completion of the diamond.
Bullish Diamond Pattern Bullish diamond chart pattern, also known as the diamond bottom is also an existing pattern which is straight opposite to what we have seen, except for the profit potential. It is used to identify the downtrend reversal, but their formation is scarce when compared to the bearish diamond tops.
For the Bullish diamond pattern, the entry is the same as that of the diamond top, but the exit by the uptrend and the stop loss is placed at the last trough formed inside the pattern.
Before trying the learned chart analysis pattern in real time, use the historic trading charts to check if you can identify the right pattern. Novice traders, because of their overwhelming enthusiasm, often put their knowledge to work before testing it out and incur heavy losses. Learning diamond pattern makes no difference if you don’t practice and hone your skills.
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Making the Most Out of the Wedge Pattern Formation

Making the Most Out of the Wedge Pattern Formation
Rising and falling wedges
Rising and falling wedges are chart pattern formations mostly employed by day traders for their potential in predicting the upcoming price actions. It wouldn’t be precise to group wedges into one category; Wedges can either be reversal or continuation pattern. And just as the name suggests, the ever wavering graph gives rise to a formation much similar to that of a wedge.

Rising Wedge: Formation


Rising wedge
A rising wedge is formed when the sloping support line goes steeper than the resistance line. The support line is the slope or plane below which the price actions struggle to stoop, and the line above which the price action struggles to break through is the resistance line. The distance between lines decrease gradually and when the lines come close to each other, the chart will be inflicted by a redirection.

Reversal or Continuation

The factor which decides the formation’s character is not how long it takes to complete the formation, rather the emphasis is on when the pattern is formed. If the rising wedge is formed in the uptrend, then it is most likely a reversal; and in the downtrend, the wedge is most likely to go as a continuation.

Price Target:

The right position to take the trade is when the prices fall below the support line. It signifies that more traders are willing to go short than the ones willing to go long.The safest position to exit with substantial profits is by the difference between the resistance and support at the start of the wedge. The measured height is used from the entry point to determine the exit point in the downtrend.The stop loss is placed at the recent high within the wedge, just to be safe in case of a misinterpretation.

Falling Wedge: Formation


Falling wedge
Falling wedge is much similar to the rising wedge. The resistance line progressively narrows down to the support line and establishes a wedge-shaped pattern. The distance between the lines gradually comes down and after the narrowed part is when the surge is likely to occur.

Reversal or Continuation

The falling wedge can be a continuation or reversal, just like its bearish counterpart. The falling wedge occurring at the downtrend is mostly suspected to be a reversal pattern. On the other hand, the wedge falling at the uptrend is most likely to be a continuation.

Price Target:

The right position to take in forex trading is when the prices rise above the resistance line. It signifies that more traders are willing to go long, rather than short.The safest position to exit with substantial profits is the difference between the resistance and support at the start of the wedge. When the price thrusts above the resistance line, the exit can be marked at the approximate height of the wedge.The stop loss is placed at the recent low formed within the wedge, to limit the losses in case of a misinterpretation.

Bottom Line:

Identifying and trading chart patterns are one of the peerless ways to make quick profits, but rudiments astuteness to banish misinterpretations and miscalculations. The catch in trading wedges is that once the formation is complete, taking the trade can be profitable irrespective of the reversal and continuation. We offer a full suite of the best trading platform for beginners and professional traders. we are the trusted and experienced regulated online forex brokers for Forex, Futures, CFD and Currency Trading.
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Trading Double Top and Double Bottom

Trading Double Top and Double Bottom

Trading Double Top and Double Bottom
Double top and Double Bottom are price action pattern formations identified to predict the behavior of the market. As the name suggests, Double Top is when the price action forms two peaks almost equal to each other, and the Double Bottom is when the price action dips to form two consecutive bottoms with only a peak separating the two. Of all the chart pattern formations, Double Top and Double Bottom could pass as one of the easiest-to-identify.

Double Top Identification

Double Top is formed when the market follows the uptrend and then pulls back. The pullback must have created a peak to its left in order to form a trough. The price then again rallies to form the second peak almost equal to the first, then drops again lower than the trough. The second peak, unable to break through the limit set by the first, marks the resistance and reduction in buying, thereby calling out a potential reversal.
Trading Double Top

Neckline

The right place to draw the neckline is at the lowest point of the pullback. The price rises from the trough to form the second peak and drops back again to the neckline completing the formation of Double Top and the opportunity.

Entry

The right time to enter the trade is by the completion of the pattern formation. When the shaky line from the second peak downs to the neckline signifying the uptrend reversal, it plunges deep breaking through the neckline. Shorting is the obvious option for profit since the prices are dropping.

Exit

The safest exit with considerable profit is calculated from the neckline with the same value as the height of the peaks.

Stop Loss

In case, worse comes to worst and you misinterpret the chart for a double top, Stop Loss is the measure to keep your loss to the minimum. It is better to limit the loss to the latest peak created within the pattern.

Double Bottom Identification

On contrary to the double top, the double bottom is identified by a dip, followed by a rise, which is again followed by a dip. In the downtrend, the price forms a trough by pulling back to the upside. The price drops again to a point above the first trough unable to drop lower signifying the reducing sellers, thereby marking the downtrend reversal. The price then rallies all the way up until it falls short of buyers or reaches a balancing point.
Trading Double Bottom

Neckline

Here, Neckline is the plane drawn to connect both troughs through the edge of the middle peak.

Entry

Similar to the double top, it is best to enter the trade by the completion of the double bottom. When the price rallies towards the neckline, it goes all the way up breaking through the neckline. So going long at the neckline makes the most of the opportunity.

Exit

The position in the uptrend, marked from the neckline with the same value as the height of the troughs, is safe to close the trade.

Stop Loss

Stop Loss for the Double Bottom is set at the recent trough formed inside the pattern to limit the loss which is inevitable.Double Top and Double Bottom are trend reversal patterns, which even the traders who disregard the chart patterns look forward to. These are simple trading patterns and doesn’t require much expertise to be able to identify, but the only shortcoming is that the reward: risk ratio is not too tempting. The ratio can be made favorable by setting stop loss in a much closer position. It is advised to take the trade only when the potential for profit is sound.Start forex trading with the use of demo account before you investing the real capital. That way you can get a feel for the process of trading and decide if trading forex is for you also we provide the best trading platform for beginners. When you're consistently making good trades on the demo account, then you can go live with a real forex account. Limit your losses.
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get free forex trading signals by Simple ABC Correction

get free forex trading signals by Simple ABC Correction
What should you look for when searching for measured moves? Here’s a list • Measured moves act as reversals of the prevailing price trend. For MMUs, look for a downtrend before the chart pattern begins. For measured move down , look for an uptrend preceding the pattern.
• The first leg should be a straight-line run with little curve to it.
• The corrective phase should be proportional to the first leg. Prices usually retrace 40% to 60% of the first leg move. Be suspect of larger retraces. Pair large first legs with large retraces; small first legs with small retraces. Avoid patterns that look like horizontal saw teeth—the retrace has gone too far.
• The second leg should approximate the slope of the first leg, but allow variation.
• Volume trends downward throughout the pattern.
Simple ABC Correction Trading Tips and free forex signals
Draw a trendline from A to C and extend it downward. When price closes above the trendline, buy.
• For more aggressive traders, draw a trendline down from C and buy when price closes above it (see the dashed line in the figure). Also, a close above the intraday high at valley B works.
• For more conservative investors, a close above C or even A is the buy signal.
• Buy only if the market and industry are both trending upward, so the stock can make the most of upward momentum.
• Be prepared for price to reverse at A—36% do, and prices drop, confirming a double top.
The larger the corrective phase retrace, the better the chance of meeting the price target
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How to Get Benefit With Trading Triangles

How to Get Benefit With Trading Triangles

Trading Triangles
Triangles are one of the price action concepts of the chart. Triangles can reveal us many things about the market scenario, momentum shifts and the balance between bulls and bears. Triangles are made by uniting two trend lines where one is resistance and another is a bullish or bearish line. Every trend line comprises two or more than two prices thus, upper and lower trend lines necessitate at least two or more points in price.There are three diverse types of triangles and which are explained below
  1. Symmetrical Triangle
  2. Ascending Triangle
  3. Descending Triangle
Symmetrical Triangle
In this triangle, the upper trend line is leaning downward, and the lower trend line is inclined upward at the same angle. The connection between these two trend lines is called “Apex” whereas the base is away from the first high point and first low point.

Symmetrical Triangle
This pattern is bullish in an uptrend as it shows the high possibility of the continuation of the current uptrend. In reverse, this pattern indicates a high possibility of continuation of the downtrend too. The potential price fluctuation can be calculated by the tallness of the base. This is assumed that the breakout of symmetrical triangles usually happens in the direction of the trend. The probability of success is, therefore, greater when we think of symmetrical triangles as being a continuation pattern of forex prices or derivatives prices.
Ascending Triangle
In this triangle, the upper trend line must be horizontal, and the lower trend line should be upward inclined. The horizontal upper trend line of such pattern specifies the resistance which is stopping the price from going further up but the upward slanting lower trend line voices us about the occurrence of an uptrend.

Ascending Triangle
These kind of patterns are bullish and normally found in an up-trending market. It has an apex point and a base. The minimum price movement is equal to the height of the base from the breakout point same as similar triangle patterns.
Descending Triangle
In this triangle, the upper trend line should be downward tending and lower trend line must be horizontal. The horizontal lower trend line of such pattern stipulates a support line and this support line is preventing the price from going more down. However, the upward inclined lower trend line displays the manifestation of a downtrend.

Descending Triangle
These triangle patterns are bearish in nature and typically originate in a downward market. It also has an apex and a base point. The smallest price fluctuation is equal to the height of the base from the breakout point.Triangle breaks out patterns are very popular among most of the trader regardless of the forex, commodity or stock markets. Their best use may lead to winning the trade however their confirmation is required before placing the orders.
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Forex Reversal Trading vs Trend Trading (Don't Screw This ... 5 Classic Reversal Patterns - YouTube Best Trend Reversal Indicator - Trend Reversal Patterns Forex 03 Reversal Patterns - Head and Shoulder - YouTube Trend Reversal Patterns Stock Volume Analysis - YouTube

Here are the top 12 forex reversal candlestick patterns that will enhance your currency trading endeavor by giving the signal to buy or sell. In forex trading, there are 3 main ways that forex traders generate buy or sell signals based on their trading strategies. They use: forex indicators; candlestick patterns, like reversal candlestick patterns. or forex chart patterns. In this post, I will ... Forex reversal patterns are on chart formations which help in forecasting high probability reversal zones. These could be in the form of a single candle, or a group of candles lined up in a specific shape, or they could be a large structural classical chart pattern. Each of these chart formations has a specific reversal potential, which is used by experienced traders to gain an early edge by ... How to spot trend reversal in Forex? And here is the complete answer. Identifying a trend reversal in Forex is not an easy task. And will never be false proof. However, following consistent process to identify trend reversals will lead to good results. Before outlining the methods, let’s have a very quick intro on trends. Read more about the 123 Reversal Forex Strategy here. Impact of Reversal Signals . Watching out for reversal signals is always important. Regardless of the fact if you are with the trend trader or reversal trader (or both), watching out for reversal signs is a very important part of trading. Reversal traders use these signals to establish their entries. With-the-trend traders use these signals ... Conversely, if price is in a downtrend, a reversal chart pattern will signify that this trend will reverse and the price will now follow an uptrend. Lets have a look at some common reversal chart patterns, below. Double Top. The double top is one of the most common reversal chart patterns. A double top is a strong signal that an uptrend is about to reverse because the pressure that the buyers ... Using Reversal candlestick patterns in Forex correctly can have a noticeable positive impact on a trader’s performance. And key to spotting trend reversal in Forex or confirm a trade.. If you don’t know what’s a candlestick pattern, you can refer to our comprehensive Forex technical analysis tutorial.. Trading success is all about following your trading rules. A forex reversal happens when the two averages make a crossover. The chart below shows that the USD/ZAR pair was initially in a downward trend. The bullish reversal happened when the 14-day and 25-day EMAs made a crossover. Similarly, the bearish reversal happened when the two crossed over at the top. Double EMA approach. Another approach of trading forex reversal patterns is to use the moving ...

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Forex Reversal Trading vs Trend Trading (Don't Screw This ...

What is the best trend reversal indicator and how to spot reversal patterns on forex? See how it is done and grab our free Direction Arrows indicator below. ... In this video we explain what a reversal is and show you five different classic price patterns to look out for that may signal a reversal. Test and practice ... Trend reversal patterns using stock volume analysis for day trading and swing trading today's markets using price action. http://www.topdogtrading.net/youtub... The head and shoulder pattern can be used in uptrends and downtrends. Out of all reversal patterns this one signals the reversal of the ongoing trend. This c... Overbought Oversold aren't real things in FX trading. Were you aware of this? You should be. Forex reversal trading is a very bad idea. I show you why. This ...

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