The original idea here on this threads was that each participant would take a separate chapter and comment on it. However, personally I would prefer that everyone reads the same chapters at the same time and then mutually discuss its content. Any comments or preferences about this?
In the meantime, whilst waiting to see who are joining in, here are some further general comments from the early parts of this book.
The book covers both a fundamental and technical approach to trading but does not see these as an "either/or" decision even for trading on short timeframes like 5m. He states:
"Why take time to look at forex fundamentals? Why should fundamentals matter if a trade is done off a short-term time interval such as the 5-minute chart? The short answer is that one cannot separate the fundamentals from the technical analysis without exposing oneself to great distortions in understanding the forex market. Foreign exchange is by its nature both fundamental and technical and reflect the increased globalization of the world economy."
Whilst I am not personally convinced that following fundamental factors is necessary for trading short term positions, it is clear that the contents of this book, although divided into fundamental and technical sections, are intended to form a whole picture rather than separate approaches to trading.
Part 1 starts with some good basic concepts of what forex is about:
"Consider the following: every transaction in the world settles in a currency. Whether it is a consumer purchase, an imported or exported item, an investment in an equity, or even cash under the mattress, the world’s economic activity is essentially a flow of money."
It is easy to forget that there is a real forex market underlying our retail/broker world, which is constantly moving huge sums of money around the globe. Nor are currencies only related to their own domestic economy. The USD, for example, is the most widely used currency in commerce even between non-US parties.
"Forex trading becomes possible because the world is constantly assessing and reassessing the value of one currency against another. The forex currency trader is looking to tap into this stream of changing values"
This, I think, is very nicely stated. Huge amounts of international trade are influenced by, and respond to, particular levels of currency, and massive investment funds follow the relative returns obtainable from various investment alternatives, currency levels, and interest rates. Whilst the world still trades and invests freely and across borders there will be a forex market, and that market will continually move.
"The challenge is to find the right combination of tools that can assist the trader in finding high-probability profitable trades"
Ahaa! I knew there must be a catch.....................................................