Your feelings impose direct impact on the state of your account. You may have a brilliant trading system, but if you feel scared, irritated or upset, your account is very likely to suffer.
Trading tactics are required to minimize risks of operations conducted. There are standard situations, showing the best possible ways of further development. Trading tactics allow not only minimizing risks, but maximizing profit as well.
Like reversal models, continuation models are formed during periods of unstable equilibrium in the market, which appears when forces of bulls and bears are approximately equal.
Thorn - Unlike other reversal models, which reflect gradual changes in a trend dynamics, the thorn is a sharp jerk of the price in some direction, immediately followed by a jerk in the opposite direction without any pause.
Many statements discussed in the pages, dedicated to the model “Head and Shoulders”, are applied to the rest models of the trend reversal. The model of “Triple Top or bottom” is encountered more rarely, than "Head and Shoulders", and is just a version of it. The main difference consists in the fact that all three peaks (or three falls) of a triple top or bottom respectively are located almost at the same level.
Today we will study a most well-known trend reversal model called “Head and Shoulders”. During our previous lesson we discussed that existence of a previous trend is required for formation of every price model. The condition for formation of the “Head and Shoulders” model is ascending movement in a price graph, when every next rise and fall is higher than the previous one.
Analysts have noticed one more specific feature of price movement: any trend reversal does not occur in instantaneously, with a wave of a wand. Not at all! In most cases any trend slows down and stops at first. A pause occurs in the movement, the so called transition period, after which the trend continues or reverses
The first step in any trader` s work consists in determination of the prevailing market trend, then in selection of the price appropriate for opening a position with the trend direction.
Lars Tvede “The Psychology of Finance”
A company known under name “The South Sea Bubble” started its activity in 1711, when Earl of Oxford founded “The South Sea Company” financed by many traders of that time (the company` s full name was "Manager and Company of Traders of Great Britain for Support of Fishing in the South Seas and Other American Parts”). The company acquired almost 10 million pounds of the state debt with guaranteed annual rent of 6 % and monopoly for the whole trade with Latin America.
Do you really want success? Already for seventeen years I have had a friend with a stout wife. She dresses well and has been permanently on diet for the whole time I have been acquainted with her. She says that she wants to lose her weight and does not eat cakes and potato, when she can be seen by other people, but I have seen more than once how she attacks this food with a fork in her hand in the kitchen. She asserts that she would like to be slender, but stays as stout as on the day when I met her for the first time. Why?
Discovering Fibonacci World - The sequence of the Fibonacci numbers is considered to have been discovered by Leonardo Fibonacci de Piza, a mathematician who lived in the 13th century. He was one of the most famous scientists in his time.
Why do thousands and thousands of clients leave the business with losses?
Work at financial markets is impossible without an effective fund allocation program. Efficient capital management helps a trader survive in markets with margin trading. Only with observing equivalent ratio between a profit sum and a loss sum calculated for an average bargain, a trader obtains an opportunity to work with funds instead of just playing. Let us consider general principles and rules of capital management.
At the initial stage you start observing trading. You are aware that it is a good way to make money, since you hear about it and many millionaires. Unfortunately, like at the first desire to drive a car, you think that it will be easy to do it — indeed, what difficulties can be encountered in it?! Price moves up and down — what secrets may there be? Just start!
We already know that any trend is alternation of rises and downfalls, moving in a certain direction. It is possible to draw horizontal lines through these maximums and minimums. These are so called barriers on the movement ways. Price often pushes off from them, and, on the contrary, accelerates when it breaks these barriers.
In order to draw a channel line in an ascending trend, we need the maximum located between two minimums, through which we have drawn the trial trend line. We shall draw the line parallel to the trend line through the maximum. This line is called the channel line. Then we will draw a new channel line parallel to the trend line through the next maximum.
We are already aware that price is moving most of the time, and our opportunity to make money is disclosed in it. Any trader` s challenge is to define the main trend and to trade together with its direction. Analysts have been studying trends for a long time, and today the most preferable trend definition sounds
In FOREX currency market and other financial markets one get make plenty of money. But for successful operations in this business, like in any other one, it is required to possess certain working skills. In FOREX market in order to know what will happen to any currency next day, or, in other words, to forecast its future value, it is necessary to understand and apply methods of financial market analysis. Currently there are two acknowledged and application experience proved methods.
Here’s a step-by-step look at a trading system that you can incorporate into forex as well as other markets.
MACD indicator was developed by Gerald Appel, editor of “Systems and Forecast” journal. Owing to clearness combined with simplicity and efficiency of using the analysis of two averages, this indicator has won great popularity in modern trading practice.
who or what can be your ally?
Here’s a low-risk/high-profit trend-following method that you can apply to the forex markets.
Moving averages occupy a worthy place in any market participant` practice. They are simple, clear to understand, convenient to use. Nevertheless, every trader with self-respect and some experience observes that although everything is not bad with the indicator in general, there is a problem as well. This is a lagging indicator. Those traders who have mathematic education under their belt tried to improve the indicator more than just once or twice. Such attempted resulted in appearance of new kinds of moving averages. I would like to mark for myself that the situation has not basically improved, there have just emerged more versions of such indicators.
We already know that on certain diagram areas MA with a larger period works better, while on others it is better to use more sensitive moving average. And why not use them together on the same price diagram?!
Let us assume that we have to obtain the average closing price for the last ten days. For this purpose, we total all the closing prices within this period and divide it by ten (number of days)
Today we are going to deal with such a computer indicator as Simple Moving Average - MA. This is one of the simplest indicators, but at the same time it is the most popular and commonly used indicator with traders all over the world.
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