Paxforex: Secrets of Market Wizards

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The currency markets are experiencing sharp reversals in the face of major biases, which could be pullbacks or potentially new signals. If you look at your charts more carefully during a busy trading period, you would observe that instruments do not move in straight lines. This is a propensity in the markets; a major bias is punctuated with major or minor retracements, continuations and mean reversion movements.

EURUSD
Primary trend: Bullish
This recently bearish instrument has turned bullish – with the possibility of a bullish continuation. It could be safely said that there is a new ‘buy’ signal in the market. Both lagging and leading indicators have confirmed this. So it is expected that the nearest resistance lines would be breached to the upside as the bullish bias continues. The support line at 1.2900 should check any intermediate bearish threats.

USDCHF
Primary trend: Bullish
The USDCHF should normally go in a contrary direction to the EURUSD, but the bullish bias on the chart is still valid. However, the present bearish correction is so determined and serious to the extent of posing a great threat to the extant major northward outlook. The oscillators have already given the indication of a trend reversal, but the lagging indicators are yet to follow suit. Therefore, it would be OK for to wait for further confirmation before taking any position.

GBPUSD
Primary trend: Bearish
This is a bear market and it could remain so for the next several trading days. The Cable has been plunging slowly and steadily. The issue is that, it would first go upwards on a short-term basis (giving a good chance to sell short), and that is what is happening right now. The price may not be able to reach the distribution territory 1.5200 before going downwards. Eventually the price may reach the accumulation territory at 1.5000, which is not a lofty target.

USDJPY
Primary trend: Bearish
Having given up about 2 weeks’ gain, this pair has been going downwards in some determined manner. After testing the supply level of 103.50, the price has dropped by approximately 200 pips before stabilizing. Since that bearish pullback was extremely serious, it has led to a new ‘sell’ signal on the chart. Right now, there is a Bearish Confirmation Pattern on the chart; which gives a good opportunity for short sellers.

EURJPY
Primary trend: Bullish
The condition on this cross has remained wonderful for the most part of this month. For example, the bullish bias has been maintained in spite of the recent sideways moves and consolidations to the downside. Even the last significant pullback in the market has failed to lead to a clear bearish signal. Oscillators and lagging indicators are yet to generate a bearish signal, and for now, it may sound sagacious to stay out of the market until there is a clear indication.

This article is concluded with the quote below:

“Trading is ONLY about making money. If you can’t do it on a regular basis you are not a trader. Everything else is just conversation.” – Brian Lund

Source: Best Forex Broker, Online Forex Trading Broker - PaxForex

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Because of the weakness on the Greenback, the EURUSD and the GBPUSD have been bullish, whereas the USDCHF has been bearish. This outlook may be valid for the next several trading days. The JPY pairs also have the potential to maintain their extant outlook.

EURUSD
Primary trend: Bullish
There is a bullish indication on the EURUSD, with the current Bullish Confirmation Pattern on the chart. The price recently reached a weekly low of 1.2887 during a bearish retracement attempt, and it has been going upwards since then, to the point of generating a bullish signal. The price could reach the resistance lines at 1.3100 and 1.3200 respectively. During that attempt, any bearish correction along the way ought not to take the price below the support line of 1.2950.

USDCHF
Primary trend: Bearish
This is a bear market which has a Bearish Confirmation Pattern (as signified by the indicators). There was a recent clean rally in the market, reaching a peak of 0.9780, which was a weekly high. From that weekly high, the price has gone downwards by over 200 pips. This is an outlook that is supposed to continue to be valid. Eventually, the price may fall towards the support level at 0.9400.

GBPUSD
Primary trend: Bullish
There is a new era for this wonderful pair. From the weekly low of 1.5008, the Cable has gone upwards by roughly 230 pips. There is now a Bullish Confirmation Pattern on the chart, for the indicators now point to the bulls’ supremacy. The nearest target to be reached between now and the next several trading days is the distribution territory at 1.5300. Along the way, any potential bearish threats ought not to take the price below the accumulation territory of 1.5100.

USDJPY
Primary trend: Bearish
This is a bear market – something that could remain so. One reason behind this is the weakness of the Greenback. The Greenback is not strong enough to pull this pair higher, and as a result of this, there is still a bearish indication on the chart. It is advisable that only short trades ought to be sought here, unless otherwise indicated. The only thing that can render this possibility invalid is the condition in which the price breaks the supply level at 102.50 to the upside and closes above it.

EURJPY
Primary trend: Bullish
There is currently a degree of uncertainty on this cross. The new lease of strength in the EUR has made it possible to help the cross withstand bearish threats. So it can be said that the price has been bullish recently. The price has not gone upwards determinedly. Nevertheless, it is sagacious to seek long trades because there is a great probability that when the price does break out, it would be to the upside.
This article is concluded with the quote below:

“The key to success is to decide when to follow the crowd and when to go against it.” – Joe Ross

Source: Best Forex Broker, Online Forex Trading Broker - PaxForex

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“Sometimes people are so attached to the way things are that they would rather keep things the same and continue to fail rather than make those changes.” - Adrienne Toghraie

We tend to think of harvesting our gains and smoothing open trades; something that is easier said than done. Big institutions have very high stakes that would have impact on the markets if they were to be smoothed at once. This is often in the favor of those institutions. At the end, you’ll need to choose a trading system that fits you.

It’s sad that misinformed souls and even highly educated people feel that one can’t be triumphant in the market for the long-term. This is far from the truth. It’s true that only a small percentage of speculators would enjoy lasting success in the markets, for we’re competing against highly intelligent traders who have a great deal of knowledge of how the markets work. Then why should it be strange that the percentage of successful traders is usually small? This is also a fact in other areas of human endeavors – not only in trading. I’m confident that if you can adopt the essential trading principles discussed here in your trading, you’ll be a winning trader.

I incorporate 4 essential trading principles into my trading rules:

1. There must be an exit target for each trade: For each trade I open, there is always a predetermined exit target, and a maximum trading duration. Any negativity shown by my open trade is never a surprise to me for it may be presumptuous to conclude that an order is hopeless while it’s still open. Usually my trade is smoothed after it hits the stop, or the breakeven stop or the trailing stop or the target or the maximum trading duration (in terms of weeks) has expired. I don’t use discretionary exit.

2. Positive expectancy must be part and parcel of your trading system: What makes sense is a situation in which you aim to gain more than what you’re risking. It makes sense to risk $1 in trying to gain $2, but it doesn’t make sense to risk $2 in order to gain $1. Some risk $100 to make $1, or even risk their whole account to realize 5% profit. Doesn’t it matter if you make $200 today and lose $2000 tomorrow? This attitude isn’t OK, since it’s negative expectancy which ensures that you end up losing in the long run. It’s far better to risk $10 to gain $30 (or $50). This means your reward must be greater than your risk. This is what we call positive expectancy and it ensures that you end up winning in the long run.

3. Abort your losers and ride your winners: This is an excellent golden rule which makes peerless rational/logical sense. If you cut you winners and ride your losers, you’re like the gardener who uproots the flowers and waters the weeds. If you cut you losers, and let your winners run, you’re like the gardener who removes the weeds and waters the flowers. Isn’t that logical? I cut my losses with the aid of my hard, physical stops, and I ride my winners until they possibly reach their targets.

4. Use small lot sizes: I’m yet to see the guru who lasts very long in the markets by betting too big. In my trades, I use very small position, which may limit my profits, but also limits my losses. This ensures that I trade with peace of mind and remain indifferent to the outcome of an individual trades. Some think this is cowardly. Yes, coward people tend to remain safe as they point to the ruins created to overconfident traders. My sizes gradually increase with my gains and decrease with my losses. With this, I’ve found it easier to accept losses that don’t affect my accumulated profits, let alone my initial capital. I’ve also found it easier to recover my negativity. I’ve found it’s usually better to be a happy chicken than a sick tiger.

No matter the kind of trend confirmation patterns you’re using, no matter the trading methodology or chart analysis us use, you need to know that strategies don’t fail; only traders do. Systems are only strategies. They’re not traders. They don’t open trades. They are only a means to help you make trading decisions. If anyone using a trading strategy sustains a drawdown, then the drawdown belongs to her/him. I’m not saying loss is completely avoidable. Top traders lose sometimes, but not always. The inability to abort your losers is the real risk, not the strategy you use. There is no business under heaven that is immune from occasional loss. All enterprises have negativity as part of them.

What I mentioned above are far more important than any trading strategies. If you incorporate them into your trading management rules, you’ll be a permanent victor in the market. These principles are ignored at your own peril.

I’d like to end this article with the quote below:

“However, you are the most important part of your system. So, if you are not working properly, it is just as though your computer, or software, or any one of the trading tools you use is not working. In this case, the thing that is not working is you, not your system, which is doing just fine.” - Adrienne Toghraie (Source: T R A D I N G O N T A R G E T - Adrienne Toghraie, Trader’s Coach)

Source: Best Forex Broker, Online Forex Trading Broker - PaxForex

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Weekly Trading Forecasts (June 10 - 14, 2013)

The Greenback has been weak and the Yen has been strong. Most JPY pairs are also weak. The fundamentals that were released lately even added fuel to the extant biases. This means vivid bullish biases for some currency instruments like EURUSD and GBPUSD: and conspicuous bearish biases for some instruments like the USDCHF and EURJPY.

EURUSD
Primary trend: Bullish
The pair has moved upwards by roughly 270 pips recently, in conjunction with the vivid Bullish Confirmation Pattern on the chart. This northward journey is expected to continue, though there would be some consolidation and southward retracements on the way. The price could be trading above the resistance line of 1.3350 within the next few trading days. Along the line, the purported pullbacks should not take the price below the support line of 1.3150.

USDCHF
Primary trend: Bearish
The USDCHF has gone downwards by 300 pips recently. The indicators on the chart are in full support of this strong downwards bias. It could be said that since reaching the high of 0.9837 two weeks ago, the price has gone down by more than 550 pips. Any rallies on the pair would be transient in nature, not pushing the price above the resistance level at 0.9400. Within the next several trading days, the price could touch the support level at 0.9200.

GBPUSD
Primary trend: Bullish
The Cable, the lucky Cable. Isn’t it? There is a lot of optimism surrounding the Cable, and as a result of that, it is getting stronger and stronger. This volatile and strongly trending instrument has lately moved upwards by around 400 pips. There is a probability that the price could reach the distribution territory at 1.5800 during its journey further north. It could even breach the aforementioned territory to the upside.

USDJPY
Primary trend: Bearish
This instrument has become a boon to the bears. The price is going south and would possibly go on doing that. Recently, it went south by over 390 pips. There could be some transitory rallies now and then – something that is inevitable. Historically, any rally has proven to be short-term, leading to good shorting opportunities. Very soon, the price may be trading below the demand level of 96.00.

EURJPY
Primary trend: Bearish
The cross has given up all the gains it made in 4 week. It has moved downwards by more than 290 pips in the recent time. In the face of the current Bearish Confirmation Pattern, the cross would be going further downwards. The Yen is strong and the Euro is strong. But if the strong Euro succumbs to the mighty Yen, then one would need to imagine the intensity of the stamina in the Yen. Long trades are not advised here, for the cross would be going further downwards.

This article is concluded with the quote below:

“A good trader will always be better than a system, mainly because a good trader will be ahead of the system.” – Mark Williams (Source: Trade2win.com)

Source: Best Forex Broker, Online Forex Trading Broker - PaxForex

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Weekly Trading Forecasts (June 17 - 21, 2013)

The currency market instruments have been moving in a determined and predictable manner. The JPY pairs have been very weak, while the GBP and the EUR are strong. The USD is weak. However, there could soon be some pullbacks in the bullish biases (no space shuttle can go upwards indefinitely). The pullbacks could be temporary or be the harbinger of new determined biases. The trader needs not repine as a result of this, as long as time-honored trading principles are employed.

EURUSD
Primary trend: Bullish
This is a strong bullish market. Since late May 2013, EURUSD has moved upwards by over 430 pips. The price is thus breaking more and more resistance lines, though there may be some bearish pullbacks along the way, it is possible that the markets would continue to trend upwards. The aforementioned pullbacks are not supposed to pull below the price below the support line of 1.3200 at worst. Otherwise, the extant bias could be in jeopardy.

USDCHF
Primary trend: Bearish
In a direct opposite manner to the EURUSD, this pair is going downwards in a predictable manner. In the face of possible rallies (which could prove to be short-term in nature), the price could reach the support levels of 0.9100 and 0.9000 respectively. The pullback ought not to take the price above the resistance level of 0.9400. There is still much room for the selling pressure and short trades can be sought.

GBPUSD
Primary trend: Bullish
The optimism around the Cable is still extant, and so, it is normal to expect it to continue its northward quest. This means that it is probable that the price reach the distribution territories of 1.5800 and 1.5900. It is, however, unlikely that the price could touch or breach the distribution territory of 1.6000 very soon, let alone breaching it to the upside. Meanwhile, any probable bearish threat ought not to take the price below the accumulation territory of 1.5600.

USDJPY
Primary trend: Bearish
This is a weak market, and it would continue to be as such until further notice. There is a Bearish Confirmation Pattern on the chart; as supported by the indicators. One would then need to notice that, any rallies on this market have often given great short-selling opportunities. This is exactly the strategy being adopted here for now – sell-on-rallies. As long as the Bearish Confirmation Pattern on the chart continues to be valid, short trades ought to be sought.

EURJPY
Primary trend: Bearish
Since our model gave a short signal on this currency instrument (which was about a few weeks ago), it has gone down by almost 500 pips. Nevertheless, this is not without occasional strength in the market; just as the situation is really now. The present rally could just be another selling opportunity in the context of the currently weak market. The price would continue falling irrespective of any bullish retracement, and should this prove to be so, the cross could give up all its recent gains.

This article is concluded with the quote below:

“Just surround yourself with successful people. Read about what’s worked for them. They’ll often be a great barometer for new opportunities, because success often breeds more success.” – Joe Ross.

Source: Best Forex Broker, Online Forex Trading Broker - PaxForex

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Which Opinions Are Correct?

The trading world is full of too many different ideas that are hyped excessively. Many a professional often asserts that her/his own trading idea is the best.

Many traders breathe intraday trading, and many endorse investing. Some worship tape reading, while some idolize Fibonacci ratios. Some use supply and demand levels in trading, and some simply scalp. Some espouse chart patterns with Elliot waves, while some use indicators. Certain traders do trend-following only, while certain traders have adopted contrarian trading methods. Trading performances of dedicated chart analysts and dedicated news analysts have been showcased, but each group attempt to disparage the kind of analysis adopted by the opposite group, which has been triumphant. Some say the use of stops is mandatory; some say they’re successful without stops.

The list can be endless…

As Dr. Van Tharp has always put it, people trade their beliefs, not the markets. Dr. Tharp trades according to his beliefs. I trade according to my beliefs, and you trade according to what you believe. What’s useful for you mayn’t be useful for others. If you use something successfully and you’re happy with it, others mayn’t use it successfully. The reason why is because that thing doesn’t fit them. If you disagree with others, you may want to assert that your opinions are superior. What you disagree on mayn’t be useful to you. If you argue that your opinion is the best: remember that many others would always use logical reasoning to underline what they believe and make what others believe appear useless.

The Best Trading Ideas
Experiencing a losing trade or a positive trade turned negative often results in painful feeling, anger, and frustration. Are you in the midst of a discouraging situation? Remember that the markets have immense riches in them. Keep this fact in the forefront of your mind; remind yourself of them repeatedly in your career. Why we mayn’t understand why some market circumstances seem unfair to us at times, we understand that we can still be permanently triumphant in the market.

I know that from personal experience. After I’ve accepted the truth about trading, my experience in the markets has become smoother and better. That’s not to say that I never have losses in trading after this, but every loss is faced with the knowledge that I’m using a positive expectancy system. I never feel sorry I started trading, and I still love the profession today. My only desire is to keep my portfolios safe in face of permanent uncertainties in the markets. I never feel any desire to back down regarding trading.

In the trading world today, the quest for great profits can lead in many directions, but only those who focus on how to control risk and DD will be truly triumphant in the markets. Some contrarian techniques would even allow positivity consistently.

Then what is the best trading idea? Jack D. Schwager’s latest book is titled: ‘Market Sense and Nonsense.’ Ok, this means that there are senseless and sensible ideas in the markets. Good trading ideas would allow you to risk far less than you aim to gain. These ideas would let you know when to enter the market and when to stay out of the market. They’d give you some effective risk control rules. Good trading ideas won’t let you sustain big losses during unfavorable market conditions. Sensible trading ideas would make you victorious in the long run. With these kinds of ideas, you can’t avoid losses, but you’re sure to make more money than you lose ultimately.

Note: Any trading ideas that can’t achieve the objectives in the paragraph above are useless ideas, no matter how popular they’re. Any trading idea is useful only if its balance increases over a long period of time, or there are gains to make at the end of a specified trading period.

Conclusion: Trading isn’t always easy, but the results of commitment to trading success will be evident in your career. You shouldn’t expect to get an emotional uplift or feeling of quiet peace every time you trade, but as you continue your commitment, your attitude, outlook, and conduct will be like those of matured traders who are called market wizards. Speculation is full of challenges, but we can overcome them all.

This piece is ended with the quote below:

“The best theory doesn’t do you any good unless it works in the real world.” – Larry Connors

Source: Best Forex Broker, Online Forex Trading Broker - PaxForex

For more articles, go to: Forex Blog, Best Forex Trading Brokers Blog - PaxForex

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There have been sharp reversals in the markets, as the EUR, GBP and other currencies got weakened. All JPY pairs have rallied: there are confirmed new biases in the markets. As some instruments plummet further, more bearish pressure would be experienced and positions are smoothed as people show the white feather when they are risk-averse. As you probably know, exits are also a good part of any trading strategy, not only entries.

EURUSD
Primary trend: Bearish
The EURUSD has been weakened recently, giving up most of the gains it accumulated in the last few weeks. There is now a Bearish Confirmation Pattern on the chart, and short trades could thus be sought. The price might trend further downwards towards the support line of 1.3100 and 1.3000 respectively. Any rallies are supposed to be short-term, not going upwards more than the resistance line at 1.3350.

USDCHF
Primary trend: Bearish
Right now, the indicators on the chart do not agree on a particular bias. The oscillators support a bullish outlook, whereas the momentum indicators support bearish outlook. There are mixed signals in this market, and so one would need to wait for a further confirmation before one takes a position. Should the EURUSD get weakened further, this pair would be forced to trend upwards in a significant manner.

GBPUSD
Primary trend: Bearish
The optimism surrounding the Cable has already disappeared, following some Bearish Confirmation Pattern on the chart. One should seek short trades only (even any expected rallies should not take the price above the distribution territory of 1.5650). The short-term rallies are thus seen as opportunities to go short at higher prices in a context of a downtrend. Meanwhile, the price may reach the accumulation territory of 1.5300.

USDJPY
Primary trend: Bullish
There is a conspicuous ‘buy’ signal on the USDJPY. There is a Bullish Confirmation Pattern on the chart, which is a clean bias, as supported by the indicators. The price thus could be going further upwards. Any pullbacks in the price may not take the price lower than the demand level of 96.00, though it is probable that the price could go upwards towards the supply level of 100.00 within the next several trading days.

EURJPY
Primary trend: Bullish
There has already been an indication to go long on this market. Should this bullish indication continue, the price would be trading above the important market zone of 130.00, going towards the supply zone of 131.00. There could be some tests of the nearest demand zones, say 128.00 and 127.00, but the price ought not to go below the aforementioned demand zones, for the current bias not to be in jeopardy.

This article is concluded with the quote below:

“The mark of a sound strategy is that it can work in entirely different eras such as the 1920s and 1930s.” – Dr. Chris Kacher

Source: Best Forex Broker, Online Forex Trading Broker - PaxForex

For more articles, go to: Forex Blog, Best Forex Trading Brokers Blog - PaxForex

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It is well-known that events move the markets, and that what relevant personalities say (for example, central bank governors/presidents) have short-term or long-term impacts on the markets. This remains a fact, and it has affected the markets in recent times. Looking at the popular currency instruments, they have continued to go in the direction of the dominant biases, irrespective of occasional counter-trend waves. The JPY pairs are currently strong.

EURUSD
Primary trend: Bearish
This pair has continued to trend downwards, in agreement with the bias on the chart. If you have been following the trend since the ‘sell’ signal was generated, you would have seen that the pair has move in the forecasted direction, irrespective of occasional counter-trend moves. Occasional counter-trend moves are expected (and they are something normal). The price could get further downwards towards the support line at 1.2950.

USDCHF
Primary trend: Bullish
This enigmatic pair has continued to move in a slow and tardy manner, albeit to the upside (for such is the characteristic of the pair). There is a Bullish Confirmation Pattern on the chart, and the latest pullbacks in the price have been negligible so far. It is thus expected that the pair would continue to shrug off the bearish threats on it. It may soon reach the resistance level of 0.9550, or possibly break it to the upside.

GBPUSD
Primary trend: Bearish
It can be seen that the optimism surrounding the Cable has disappeared, though this may return as the Bank of England is possibly expected to have a new governor (Mark Carney by name). This may potentially cause a new lease of strength in the Cable (otherwise the Cable would be doomed to continue trending downwards further). The expected Midas Touch from Mark could push the Cable upwards, though the current trend is valid.

USDJPY
Primary trend: Bullish
The USDJPY trended lower towards the demand level of 97.00, in what could be some noteworthy bearish retracement on the chart. That bearish retracement did not violate the extant bullish trend, for the Bullish Confirmation Pattern has held out till now. Right now, the bullish bias has been resumed and the price could go towards the psychological supply level of 100.00 within the next several trading days.

EURJPY
Primary trend: Bullish
Since all the JPY pairs tend to be positively correlated (i.e. they all go downwards when the Yen is very strong, and they all go up when the Yen is very weak), it is not a wonder that the EUR, though not strong at the moment, has been going upwards against the Yen. This drives home the lesson that currency trading is all about matching weak currencies against strong currencies. There was a recent ‘sell’ signal on the chart, which was quickly rendered invalid as the cross assumed a clear uptrend.

This article is ended with the quote below:

“If you are active in the market, you need to know what you are doing… This is a time for neither fear nor greed. For those who are sharp and well trained, this could be a time for tremendous profits.” - Dr. Van Tharp (Source: Vantharp.com)

Source: Best Forex Broker, Online Forex Trading Broker - PaxForex

For further articles, go to: Forex Blog, Best Forex Trading Brokers Blog - PaxForex

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The question above, as commonplace as it seems, is still asked by many people who’re interested in Forex trading. How much do you need to invest for optimal returns? How much is needed for full-time or part-time trading? This piece is my take on the subject.

In one of his past articles, the world-famous Dr. Van. K. Tharp stresses one of the most important reasons why most people find it very difficult to make money in the markets. One of the most important reasons is that most people don’t have enough money. Too many people open accounts with too little money, so they can’t execute proper money management, neither can they expect to live on small accounts.

You can open a Forex account with $1; you can also open it with $50 billion. While most brokers have minimum deposits limit, they’ve no maximum deposits limit. Some brokers even offer micro or mini and/or cent accounts so that traders with small money can trade while having many options to control risk. Happily, gone are the days when traders needed huge amounts of money to capitalize on market opportunities. Nowadays, high leverage allows you to make larger transactions with smaller capitals. High leverage is a curse to those who’re ignorant of sound position sizing and risk control, while it’s a blessing to those who’re aware of that.

The bigger your capital, the bigger your returns, and the smaller your capital, the smaller your returns. Let’s assume trader A opens an account with $1000, trader B opens an account with $10,000 and trader C opens an account with $100,000. If traders A, B and C make 20% each on their respective accounts on an annual basis, here’s their personal income in that year.

Trader A makes $200. Trader B makes $2,000, whereas Trader C makes $20,000. You see, hedge funds managers make billions or millions of dollars as profits because they invest billions and millions of dollars.

As you probably know, your account must be big before you can make good profits (for a small percentage gain would make a huge difference). You can open an account with small money; say $50 or $250 or $500. However, don’t expect to make a living from such small capital. Personally, I believe that if one want’s to make a living from trading, one’s account mustn’t be less than $20,000. This would give you an excellent position sizing and risk control flexibility. You need to check my strategies articles and see my position sizing recommendations for each various account balances. You’ll then see why it pays to have big accounts.

For you to make a living from $1,000 or $5,000 or $10,000, you need higher risk, which also comes with a possibility of a worrisome roll-down. With $100 or $300 or $500, one can experience the thrill of speculation, but one must never expect to make a living from that. Those who want to make a living from an account that’s small would need to double the account many times. Do you know what that’s? It’s called suicide trading. This is because what can double your account also has the potential to result in big losses or a margin call.

If you’d like to open a big account but your financial circumstances preclude you from doing that, you can still open a small account and begin to trade. Just don’t expect big profits from a small account; which means that you need to be realistic and lower your expectations. As long as you have other source(s) of income, you should be fine, and there shouldn’t be any pressure on you to double your account quickly.

Conclusion: You can start trading with a very small account, but that one has fewer merits than a big account. Evidently, you need big accounts to trade safely and make decent profits. As you trade, you shouldn’t forget to have entry and exit points in mind. Great speculators have an exit target for each of their position, whether the position ends in a positive zone or a negative zone. Then don’t risk too much per trade. Risking less per trade would surely give you good profits as you also have the ability to curtail losses so that they don’t have a big impact on your portfolio. Long-term survival in the trading world means that your past errors have made you to become a better trader.

The quote below is taken from Dr. Chris Kacher. It shows that it isn’t correct to say that one can’t enjoy lasting success in the markets.

“I realized the efficient market theory was not relevant in the real world when it came to developing a sound strategy that put the odds in its favor. In the long run, statistics always win, and is why the house in gambling casinos always comes out ahead.” (Source: Tradersonline-mag.com)

Source: Best Forex Broker, Online Forex Trading Broker - PaxForex

For further articles, go to: Forex Blog, Best Forex Trading Brokers Blog - PaxForex

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In the previous week, the dominant biases in the markets have proven to be valid (even till now). It can be seen that the consolidations and reversals that happened on major pairs and crosses were short-term in nature; as the respective instruments have continued in the direction of the major biases. The USD and the JPY are strong, whereas the GBP and the EUR are weak.

EURUSD
Primary trend: Bearish
This is a bear market, and it is supposed to continue being so. The pair may continue to trend lower, possibly towards the support lines of 1.2700 and 1.2650. However, this may not happen without some occasional rallies along the way, which are not expected to take the price above the resistance line at 1.3000. For the several trading days to come, the aforementioned resistance line would be a great barrier to any bull’s interests.

USDCHF
Primary trend: Bullish
Being able to shrug off bearish threats on it, the USDCHF has been able to continue going northwards. The stamina of the USD is a reality, and as such the scenario in this market is no surprise. Having been able to overcome adamant resistance levels, the price could go on towards the resistance levels of 0.9650 and 0.9750 respectively. Would the USD be able to reach parity with the CHF? Time will tell.

GBPUSD
Primary trend: Bearish
For now, there is no optimism around the Cable, for it is in a vivid downtrend. On July 3, 2013, there was a significant rally in the price, which eventually proved to be short-term in nature. It simply happened that the rally was a good sell-shorting opportunity in the context of the present downtrend. The Cable has plummeted by hundreds of pips, and it could reach the accumulation territory of 1.4000, should this weakness continue.

USDJPY
Primary trend: Bullish
Recently, this pair was able to breach the great psychological level at 100.00 to the upside. The USD is now more valuable than the JPY. The JPY is strong and the USD is strong. It now appears that the USD is stronger than the JPY, for the bias on the USDJPY is towards the north. There is still a Bullish Confirmation Pattern in the market, and therefore, is probable that the price could go upwards towards the supply level 101.00.

EURJPY
Primary trend: Bullish
The EURJPY does not look buoyant at the present, given the lack of stamina in the EUR itself. Unless the weakness in the EUR is extremely significant, the cross would have to respect the direction of the other JPY pairs (as in the normal positive correlation). At the present, it is advisable for one to stay away from this market until there is a clear signal. This is because there are mixed signals on the chart.

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[Dscript]

wow… this forum is great… thanks guys

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The recent week was characterized by significant reversals in the markets; an event which led to new confirmed signals on popular pair and crosses. This is especially possible with the new lease of stamina in the EUR and the GBP, as the USD was suddenly caught in exponential weakness. Even the JPY pairs have assumed a new bias (in most cases). The new signals in the markets are expected to continue.

EURUSD
Primary trend: Bullish
It can now been seen that any bearish threats on this pair has already been rejected successfully, as the price rose significantly in the latest development in the market. There is now a clean Bullish Confirmation Pattern on the chart, and the price could go on beyond the resistance lines at 1.3100 and 0.3200 respectively. Within the next several trading days, it would be sensible to seek long trades only.

USDCHF
Primary trend: Bearish
From the weekly high of 0.9750, this pair dived by roughly 300 pips. The price is now trading below its formers support levels (which are now resistance levels). The market appears to be oversold, as indicated by some oscillators, but in reality this means that the market is weak and would continue to trade lower. In the face of this fact, the price may reach the support levels at 0.9400 and 0.9300.

GBPUSD
Primary trend: Bullish
It is clear that some vivid optimism has returned to the market. Could this be called Mr. Carney’s effect? The time would tell whether the new bullish bias would be sustained. However, based on the reality in the market, the Cable is supposed to be going upwards in a significant bullish mode, though that does not rule out occasional bearish pulls, which are not supposed to take the price below the accumulation territory of 1.5000.

USDJPY
Primary trend: Bearish
A ‘sell’ signal has been formed on the USDJPY, following the Bearish Confirmation Pattern that occurred in the market. Since then, the USDJPY has traded sideways so far (for the market is volatile as a result of deadly struggles between buyers and sellers). However, the downward movement ought to resume in earnest. The price could reach the demand levels of 98.00 and 97.00. Meanwhile, the supply level at 100.00 is a barrier to any bullish attempt.

Primary trend: Bullish
When it is said that the major bias on this cross is bullish, it is precariously so. This is because there is no clear directional movement in the price for now: both the EUR and the JPY are a kind of strong, and one would need to be stronger than the other for the market to go upwards or downwards. At the end, the EURJPY would have to respect the overall direction of all the JPY pairs, and until it happens in such manner as a clear signal, no new positions are advised.

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Recently, I went to a local cash office. There were many customers there, and while I was waiting for my turn, a man asked me what I did for a living. I was happy to reply him that I’m a Forex trader and a market analyst. “Forex,” the man said, “ruined many people, including me, especially during the bear markets of the year 2008.” I immediately sensed that the man was ignorant of the realities of the markets. Since I was in a hurry and it was my turn to be attended to, I couldn’t explain anything to the man.

There are many wrong trading assumptions that are being nurtured and propagated by too many people. A few years ago, I wrote a series of articles covering 10 most widespread myths about online trading. This time around, the supposed crashes in the bear markets of the year 2008 were another myth that needs to be busted. How?

Contrary to what most novices think, there’s nothing like an everlasting trend. There’s no instrument or market that can go upwards forever, and therefore there must be some protracted bearish reversal and continuation. This is what ignorant people call a crash. The so called ‘crash’ is only a significant bearish market which can’t last forever, since it would give way to a bullish trend. When the markets go up, buyers gain and only sellers lose. When the markets go down, sellers gain and only buyers lose. If a professional trading risk manager was caught in wrong positions, she/he would simply cut the losses. That’s all.

Here are additional ideas about handling the bear markets that happened in the year 2008:

I’m not interested in the fundamentals that led to those bear markets. What I know is that bear markets must follow bull markets – though fundamentalists would always pinpoint reasons for that. Bearish trends give you great opportunities to make money by short-selling. Many great traders have made fortunes in bear markets. People like Jesse Livermore (the Great Bear of the Wall Street), John Paulson, Paul Tudor Jones, Robert Prechter, Tim Knight etc. accumulated great wealth from bear markets. There are individual traders who also make money in bear markets.

People lose in bear markets because they use big position sizes, they don’t use stops, and they decide to run their losers indefinitely. Little do people know that a bear market would continue to be bearish as long as people think it would soon end. However, as soon as most people think that the market will continue in a downtrend, then a northward reversal would happen. Likewise, a bull market would continue for as long as people are skeptical about it; it’ll reverse significantly only when almost all people show confidence in it.

In the year 2008, a competent trader who suffered initial losses would’ve exited when the losses were still small. Then she/he would see the new bearish signals and trade accordingly, thus recovering the initial losses and moving ahead. Sadly, there were certain traders who continued buying in that downtrend.

Based on my trading style and risk control parameters, what could I have done? Since I risk only 0.5% of my account per trade, I wouldn’t have lost more than that per trade if a trade went against me in that year. If I bought and was stopped out on a trade when the bearish biases began, I’d have taken the small loss (If I lost 6 trades in such a way, my drawdown would’ve been 3%) and started looking for new trades. So in the case of a bearish outlook on the markets, I’d have gone short or sold rallies in the context of the downtrend.

For instance, let’s look at the chart attached with this article. From August to early December, 2008, the GBPUSD fell by over 6000 pips! There are many currency market instruments that went bearish protractedly in that year, so the lessons below are also valid for them.

By looking at this chart, you’d agree with the lessons below:

1. When trading on the GBPUSD during that period, if your position sizes were very small and you respected your stops, the losses on this trade would be negligible. But if you used big position sizes and/or refused to honor your stops, you’d sustain huge losses.

2. With small position sizes, even huge losses can be sustained if you rode your losses in that kind of protracted bear markets.

3. By running your winner, you could’ve made huge profit in that bear market.

4. If you were initially caught on a wrong side and you were disciplined enough to cut your loss, you could’ve regained the loss and moved far ahead if you opened another trade and followed the trend.

Conclusion: Bearish and bullish biases are normal part of the markets. Sometimes, a bearish or bullish bias may last very long, and sometimes it may be short in duration. Nothing is wrong with the markets, for they’ll do what they’ll do, irrespective of what traders want. On the contrary, it’s our trading styles and approaches that bring us the results that we see. In the year 2008, the markets didn’t crash, only ignorant, undisciplined and greedy traders did. On the other hand, informed, disciplined and patient traders survive and made money. Can you see the difference?

The quote below concludes this piece:

“You will not continue to get better as a trader if you don’t track and measure what you are doing and how you are doing it.” – Dr. Woody Johnson

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In the last several trading days, the currency instruments have been able to maintain their overall outlook, though the majors do not move that significantly, except the JPY pairs. The EUR and the GBP are strong, while the JPY and the USD are weak. Matching these weak and strong currencies together with sensible logic would result in better odds. Each week, multitudes are learning what it takes to be great traders. As a result, they’re realizing their dreams and building lasting career.

EURUSD
Primary trend: Bullish
This pair has been able to trend according to the dominant bias in the market (i.e. the bullish bias), although the movement has not been that significant. The indicators on the chart are still in favor of the bullish outlook, and as such, the price is expected to continue trending upwards – something that may possibly reach the resistance lines of 1.3200 and 1.3300 in the next several trading days.

USDCHF
Primary trend: Bearish
In a negative correlation to what the EURUSD is doing, this pair has been able to move further downwards in the direction of the latest bearish indication in the market. Although the southward dive is nothing to be called ‘serious,’ it is in support of the current bearish outlook. The price is expected to touch the support lines of 0.9300 and 0.9250 respectively, as the market continues its weakness.

GBPUSD
Primary trend: Bullish
The Cable has been noted for its consolidation phases, though it has been able to reject any bearish threats on it for the main time. The pair traded towards the upside in a slow and steady manner, moving upwards by over 110 pips. In the face of the current Bullish Confirmation Pattern on the chart, it is safe to assume that the Cable would be trending upwards towards the accumulation territories of 1.5300 and 1.5400 respectively.

USDJPY
Primary trend: Bullish
As this currency instruments continue to respect its assured northward signal (for the bearish signal that occurred on July 17, 20123 proved to be bogus). However, there could be some corrections on the way, as it is happening right now. These corrections are not supposed to take the price below the demand levels of 99.50 and 99.00; otherwise the current outlook would be in serious jeopardy. The price could rise further eventually.

EURJPY
Primary trend: Bullish
In the last weekly forecast, it is said that the bias on this cross was bullish. Yes, it is still bullish, for the EURJPY is among the currency instruments that moved upwards significantly in the recent trading days. Since the EUR is strong and the JPY is weak, it is no surprise that the cross trended upwards by over 240 pips within the last several trading days. It is then probable that the price would resume its northward attempts when the current pullback pans out.

This article is ended by the quote below:

“Life is much more pleasant when we recognize and manage risk in any kind of venture.” - Jim Weigel (Source: Vantharp.com)

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In the last several trading days, we can see that the GBP, the CHF, and the EUR have continued showing strength, while the USD has continued to be weakened against them. The JPY pairs are also showing signs of noteworthy pullbacks, following their testing of major supply levels. The more overextended and protracted the current biases, the more dependable there would be probable pullbacks and bullish retracements when they do occur (whether protractedly or transitorily).

EURUSD
Primary trend: Bullish
In spite of some disturbing fundamentals that have come out in recent times, this pair has been able to maintain its bullish bias. This is an example of “bad news but the instrument continues trending upwards.’ One resistance line after the other has been breached successfully, and the price may go on towards the resistance lines of 1.3400 and 1.3450, should the present bullish bias continue.

USDCHF
Primary trend: Bearish
In the last weekly trading forecast, it was hinted that the USDCHF could end up testing the support level of 0.9300. At the time of preparing this very market prognosis, the price was already trading below the aforementioned level. However, this did not happen without protracted equilibrium phases. In the face of the current Bearish Confirmation Pattern, the price may be able to go on lower and lower towards the support level of 0.9200.

GBPUSD
Primary trend: Bullish
There is a Bullish Confirmation on the Cable… and a northward determination… and vivid optimism surrounding it. The price territory is already a forgone conclusion as long as the buyers’ interest is concerned. Within the next several trading days, the Cable is expected to reach the distribution territories of 1.5500 and 1.5550 respectively. In the meantime, any bearish threats on in the market ought not to go below the accumulation territory of 1.5300.

USDJPY
Primary trend: Bearish
Consistent weakness in the USD has resulted in the weakening of this pair. In fact, this pair would be able to go in the way of other JPY pairs. Right now, the indicators on the chart confirm a bearish signal on the chart. However, this did not happen without significant rallies which gave spurious signals in some cases. It simply happened that the rallies were nice opportunities to sell short in view of the current bearish trend. The price could go on towards the demand level of 97.00.

EURJPY
Primary trend: Bullish
This currency instrument is also in the habit of going in the way of most JPY pairs. The price recently topped at 132.70 and later nosedived. From that supply zone of 132.70, the price has gone lower by more than 100 pips. Nevertheless, one would need to wait for further confirmation among oscillators and momentum indicators (for their signals are conflicting right now). After a confirmed bias, one would then take a position.

This article is ended by the quote below:

“Successful trading is about making money, that’s it. It ’s not about ego, or being cool, or having great stories to tell your friends at the bar. The more closely your trading style fits with your personality, the less conflict it will create, meaning the less negative emotions it will generate, and the better chance you have to be successful.” – Brian Lund (Source: Home)

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