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Trading Short term
Why trade?
Now it's a very important question to answer why you want to trade short term if you want to trade at all. Many people would come up with multiple justification to trade short term starting with making some spare money in spare time to just for the thrill of trying to predict the future. Now whatever the motivation behind your motive to start trading short term one has to be very clear that it's a damn risky thing to do with accompanying huge pressure on your mental and emotional skills. If one were to simply look on the statistics available on trader's behavior, a realization dawns that almost four in five people loose money in trading in currencies and CFDs. So statistically speaking there is no justification for a average person to start trading either for short term or the long term as it's a surest way to loose money. Now all it boils down to developing some special skills to be among the minorities who make money in trading. So it leads to the next question which of course is 'how?'
How to trade?
Now if you start searching for this answer after studying all the risk factors in trading you would be literally floded with the answers. That's a irony…
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JaiBabaKi avatar

Great job!

Olkiss70 avatar
Olkiss70 1 Sep.

excellent work

Aaamira avatar
Aaamira 7 Sep.

great article!

tradelord avatar
tradelord 21 Sep.

well nice

Teo avatar
Teo 24 Sep.

good article

orto leave comments
1. Abstract.
I hope this post helps to understand one of the tricky situation at the moment of trade on news because is very risky and to give my view
on the new order wiget. This seems to be very interesting and useful but I think it could be best with some improvements.
2. Development.
2.1 Explanation trade on events.
Let's say that before a release event you decide to trade.
In this particular example I will re-create a setup based on a bear flag, so the entry could be placed below of the few candles low.
The stop loos above the last higher high, that means about 20 pips risk with a limit to the nearest lower low.
Till here seems to be a nice setup, also if you check the exponential moving average of 144, means strong downtrend.
Also, after check this setup you can say that the entry could be adjusted at the previous candle low as entry and the high as stop.
That means around 10 or less pips risk to trail the stops each candle.
But, the reality here is other.....
After the data comes on place, the price experiment a jump or explosive movement down side.
And with this filling the stops orders, first the order was filled down about 25 pips and that means your stop loss as well.
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Sebine avatar
Sebine 13 Nov.

Good job !

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USD/JPY has been trading sideways for the most of February this year. In absence of immediate triggers there were not many reasons for the big moves in USD/JPY. So I thought it's best time to analyse the USD/JPY for the big moves ahed.
A look on Fundamentals.
In recent months the labor market has continued to strengthen as well as economic activity is expand at a moderate pace. Job gains have remained solid, and the unemployment rate is staying near its recent low. Household spending is rising moderately, while business fixed investment is on a bit softer side. Measures of consumer and business sentiment are also improving after a long time. Recent indicators of activity in the housing sector were generally positive. Starts and permits for single-family housing and sales of existing homes rose moderately in the fourth quarter, and real residential investment bounced back after two quarterly declines. The outlook for the business sector is improving. A number of national surveys of sentiment among corporate executives and small business owners as well as information from participants’ District contacts is indicating a high level of optimism about the economic outlook. Many participa…
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RahmanSL avatar
RahmanSL 27 Feb.

Good analysis

Sanju777 avatar
Sanju777 27 Feb.

Nice article

lelipuzik avatar

good job!

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I have been often told by friends that STOCK trading is way better than FOREX trading and it has better prospects in the long run. Today, I would like to draw out the advantages and disadvantages of both the world in order to get a better idea for myself along with other community members. I wouldn't go much into the history and definition as most community members are pretty much aware of them.
My sole objective would be to point out the difference to grasp a proper knowledge and base our future trading decisions.
Forex market is considered as the most liquid market with a trading volume crossing over $ 5.3 trillion per day back in 2013. This is a massive figure and way more than the combined figure of all stock markets.
Each month, Thompson Reuters Index tells us the combined average daily volume of all spot, forwards, swaps, options and non deliverable forwards.
The above charts clearly depicts how often Forex is traded over Stocks.

New York Stock Exchange has over 4500 stocks listed and NASDAQ has close 3500 stocks. Apart from them, we have Tokyo, London and other stock exchange as well. If we combine the US, European and Asian stock markets …
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Lyubant avatar
Lyubant 11 July


CharmingRimma avatar


al_dcdemo avatar
al_dcdemo 11 July

Great article - useful content and very well written!

BeautybyLesya avatar

Well done!

Mariia avatar
Mariia 15 July

Good job!

orto leave comments
The US Dollar has been on the spotlight since beginning of the year as momentum has surprised everyone. Retracements continue to be shallow. The dollar bullish trend is well mature on its own and I thought it's the perfect time to reinforce my view on the dollar as many are asking: what's next for the US Dollar?
This is the US dollar's fastest rise in 40 years, and it's up 14% on this year alone, and I was one of the few to speak about the dollar rally, even before the trend to be put in motion.
Explaining the dollar's incredible turnaround, at current speed and velocity is not quite hard to explain if you have been following my articles. There are plenty of evidences, from my side, as I was preparing for this kind of move. To understand better what it's happening with the dollar i'll suggest to go over and re-read my previous articles here:
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Daytrader21 avatar

For those who are interested to find more about my own view on the US Dollar, I wrote last week an blog post talking about the 1980-1985 US Dollar analog which fits perfectly to current market environment and also it's a fractal for current price action. See link above.

foreignexchange avatar

Thanks, this article is interesting and qualitatively. Did you also have some correlation analysis with labour market ?
Great article 

Daytrader21 avatar

foreignexchange Unfortunately I never looked into that stuff, when it comes with the currency market the 2 most important things I look at are inflation and interest rates I think that anything else will just alter the view of the market, of course this is just my own opinion. Thanks

Illya avatar
Illya 27 May

It looks like you spend a lot of time for this report.Good job!!!

Daytrader21 avatar

@lllya It takes some times to put all the pieces together and also I do a lot of research because I want to provide high content to my readers. Thanks for the good words.

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Content :
Building on my first Article this month, there is pressure born from fundamentals. This pressure can be a light breeze or a devastating tornado, ripping through price barriers and expectations. As a pure technical trader, I like to anticipate fundamentals through technical data, rather than to analyze the fundamental data for clues. Here is my standing…
First Consideration :
Firstly, from my little experience, I have found that the fundamental data does not alter the actual technical trend. For example, if the price has bounced off a 4 Hour Bottom Bollinger some time prior to data, with the price not yielding, it is unlikely that the fundamental data will alter the fresh, long bias until it has reached a suitable resistance level. Depending on the data, the price might short to a nearby boundary but will find support easily and then continue long. If one is trading the news, then, as risk management, it is a suggestion to identify a reasonable boundary in strength counter-direction to the trend and to effect a stop-loss with some margin clear of it.
I was unable to post charts, however on 01/07/2014, on EUR/USD, we had USD economic news (ISM Manufacturing PMI) at 14h00 G…
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solncez avatar
solncez 30 July

nice contecst

Polinka avatar
Polinka 30 July

Great job))

Stix avatar
Stix 31 July

Thanks Polinka , solncez , VikaChechenkova  !

Stix avatar
Stix 31 July

And thanks, Ange_Farouche , noyarsh and Elani again ! Much appreciated.

PPandM avatar
PPandM 31 July

I like it. Well done :)

orto leave comments
Whether to be fundamental or technical has long been on debate, however retailers can't go after any since they are always in cloud of news noise or tied up with indicators.Most successful traders around the world are fundamental or technical and can't follow both and as traders we have experienced the time when the news has been in favor of a currency and it has lost weight or technically we look for a reversal, however the trend has continued. The question might be " how would we shorten the risk?" There are several rules to have in mind and most importantly you need to stay with mass capital in the market therefore economical situation of a country whose currency you are to buy must be considered but you need to avoid noises here after, what matters from economical point of view is the group of figures which show productivity as; GDP, CPI, Unemployment rate, and Manufacturing PMI. These figures don't change massively and by studying them on annual base and quarter base you can have a clear picture of strong economies around the world so you can have a strategy frame for what to buy and what not to.After having an image of a country economy you need to figure out what drives the …
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shahdad avatar
shahdad 7 Jan.

thanks bmg

Nicco avatar
Nicco 8 Jan.

To shorten risk (or risks) one must minimizing loses. The three most common mistakes losing forex traders make are:
1. Risking too much on a single trade
2. Trading during the doldrums between the London close and Sydney
open and overtrading during Asia without regard to the European open
3. Trading at the moment of news release.
( Horner, Raghee - "Forex on five hours a week: how to make money trading on your own time", Published by John Wiley & Sons, 2010)

shahdad avatar
shahdad 8 Jan.

thanks nicco

ante777 avatar
ante777 21 Jan.

Good article

SpecialFX avatar
SpecialFX 24 Jan.

One good method to reduce risk without negatively affecting profitability (because the two usually go hand-in-hand) is to increase diversification. Instead of trading 100k in one position, try 5 different uncorrelated positions with 20k each. The profit potential remains the same, but you only need one of those 5 positions to be profitable for the total loss to be lower than it would had been if you traded only one 100k position :)

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Come Monday, we are all scurrying up to set-up charts for the week's bias. Given that the weekend was a negative close for major currencies, the Asian markets and Bourses are a bit neutral and relying on the European news for direction. Generally I am reluctant to trade on Asian Monday, markets are directionless unless there is a pertinent news making the currencies move. As Nicholas Taleb, puts in his book "fooled by randomness", there is news and there is noise, we need to have the ability to separate the news from noise, generally I tend to keep away from reading or listening too much. Ignorance is bliss.In the world of randomness, I decide to toss a coin and start taking positions to see if technicals do better or would coin toss beat the best analysis.These are my two cents worth and my positions as a result of the coin toss experiment! - More on the experiment at - 1.2888 - EUR/USD has lost the 1.29 handle into early trading, this is just a case of thin volume trading. Given this, we will try and sell rallies back up to Thursday's high of 1.2978 and aim for our first objective of 1.2626. Technical Bias is still NegativeCoin Toss says: LongGBP/…
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RobertBric avatar

Re EURUSD: I share the view of your coin. Commercial traders are almost extremely long again (see COT) and they never lose on average in the long run. Re USDCHF: With EURCHF effectively fixed USDCHF and EURUSD are more or less 100% negatively correlated. So why trade USDCHF if the two pairs are locked, not to mention that its spread is bigger than EURUSD? I wish you a profitable week.

alifari avatar
alifari 19 May

I hardly trade anything on Monday on my live account +1.

positive avatar
positive 27 May

Cant agree more. I also made it a policy that No trades on Monday. even if I take I take very light positions.+1 for your efforts.

orto leave comments
Fundamental Analysis for the upcoming week:This Builds on the previous week. Last week there some big Fundamental releases and the major Currency Pairs had some fairly large moves too.Relative to the USDCAD - +0.99%AUD - +0.35%GBP - -0.26%JPY - -0.72%NZD - -0.80%EUR - -1.88%CHF - -1.98%Last weeks main Event in my opinion was the 3 Year LTRO release from the ECB. This was how much money the ECB was to loan out to 800 banks across Europe at just 1%. The number came in at EUR 530Bn. This is a major risk event as this is designed to give stability and liquidity to the banks and large institutions. The main fear is the increase in the leverage of the ECB as it now supports more debts that it has loaned out with no more hard tangible assets, thus increasing its leverage.Therefore a small fall or default from a few of those loans then a total loss could happen and this would be very bad. Anyway the upcoming week should build on the previous week as it seems that there could be further weakness from EUR and CHF as seen in the end of last week.Because of the VERY high amount of fundamental Releases this week I will include more than the usual 5 top ones as there are just so many of importan…
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Quattrotrader avatar

Good writin once agian. I hope you continue on with this good stuff

FX_Swingtrader avatar

Nice article. I look forward to this weeks one.

Ltjere avatar
Ltjere 17 Mar.

Goo analysis from a different perspective.

Dr_Anonimus avatar

Nice article =))

marius24 avatar
marius24 23 Mar.

i trade 70% based on fundamentals very important in forex

orto leave comments