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Year 2017 is closing and I am in mood for some light-hearted banter yet to write meaningful article. So here I go talking about some behavioral economics and its implication on forex trader and his trading. Behavioral economics in essence is a method of analysis that applies psychological aspect of human behavior on economic decision-making.
Although the terms mentioned in this article have wide implications in different economic decision making process, I will keep the scope of these terms to forex trading and investing only.
  • Framing

Fig. 1
Framing refers to how a trader perceives a forex movement of a pair. It’s a glass half full or glass half empty kind of situation(same as above comic strip). In last 2 weeks gbp/nzd is correcting from 1.98 to 1.90 zone. So when price retrace to 1.93, a trader may think, wow the pair is at 3% discount and will try to buy only to find price go even lower. So it is important to see that pair is in strong corrective mode after more than 10% rise in last 2 months.
The key is to perceive the market correctly and never feel that “I am most intelligent”. Follow technical’s and wait for the pair to form a support/resistance in strong correction / r…
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Yuliya_N avatar
Yuliya_N 3 Jan.

Very nice article. Good job friend!

Annyrio avatar
Annyrio 3 Jan.

Very good!!!

hrustiashka avatar

Well written article!

Vlad73 avatar
Vlad73 8 Jan.

well done

Siarhei89 avatar
Siarhei89 14 Jan.

good article!!!

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7/33
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The use of the tool in the Fibonacci forex trading is one of the best ways to provide some movement in the market. But like most indicators, does not give the necessary certainty to the time of entry into operation. We used 2 analysis to get away with false entries, and thus avoid the stop's caused by misinterpretation. We know that this tool is used a lot waiting for a pause before continuing the trend cycle is called retraction, and the best entry points are obtained in 38.2%, 50% and 61.8%. These operations are areas used by different operating systems on the market. But now, back to the question, and how we can get a higher hit probability at these points? How to identify the best retraction in? With this question, let's look at the figure below:In these examples we saw that hears a retraction in mind three points mentioned, but what point would we expect to operate? Let's look at the other retractions performed prior to the actual movement.If we look now, we have seen previously that very spot there was a strong 50% reduction, in this case our input would be best at this point._____________________________________________________________________________ Let's look at other mod…
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Likerty avatar
Likerty 20 May

Newcomers often wrongly assume that fib's should act as support/resistance to the pip.. But these are just reference points in the overall range... Searching coincidence points with supply/demand areas is a good way to start.

Brasileiro avatar

Thanks guys for all the comments and liked by's!

Efegen avatar
Efegen 20 May

Good article +1

cristiano_cds avatar

The best article Dukascopy.

SpecialFX avatar

Fibonacci is one of the better technical tools out there, of the few that actually has any edge :) Good work!

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45/94
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One of the elements of basic knowledge that trader has to have in order to trade effectively is currency correlation. While observing market during trading hours we can easily notice that despite fact that currencies are priced in pairs, no single pair move completely independent from each other.Some currency pairs tend to move in same direction while other pairs move in opposite directions.Awareness of this correlation can be useful.DefinitionCorrelation on forex market is statistic measure of relation between two currencies, and it ranges between -1 and +1. A correlation of +1 indicates that two currency pairs will move in same direction 100% of the time. A correlation of -1 indicates that two currency pairs will move in opposite direction 100% of the time. Correlation 0 indicates that there is very weak or random correlation between two pairs.How to read the tableEach cell of the table shows correlation coefficient between two currency pairs. Quick way to interpreting table values is using these categories (minus means negative correlation, when price one go up, others go down and vice versa): 0.0 to 0.2 Very weak to negligible correlation0.2 to 0.4 Weak, low correlation (not …
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Livornese avatar
Livornese 24 Sep.

You are right! Correlations are there and we need to know about them to raise our chances of success.

doctortyby avatar
doctortyby 25 Sep.

All currencies are correlated with the US dollar... and the Euro... but the US $ is the on that moves the market... +1 for your article. trade well

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