Forexpathfinder indicator - After Government Shutdown USA Nonfarm Payroll and Other To Be Release Today (Friday, October 18)

Canada Core CPI    -    8:30am NY time   (Friday, October 18)

Change in the price of goods and services purchased by consumers also called Bank of Canada Core CPI, CPI Ex Volatile Items, excluding the 8 most volatile items is usually released monthly, about 20 days after the month ends; When Actual greater-than Forecast is Good for currency; Volatile items account for about a quarter of CPI but they tend to be very volatile and distort the underlying trend. The Bank of Canada pays most attention to the Core data - so do traders. This is among the few non-seasonally adjusted numbers reported on the calendar, as it's the calculation most commonly reported.













Important of It.
Consumer prices account for a majority of overall inflation. Inflation is important to currency valuation because rising prices lead the central bank to raise interest rates out of respect for their inflation containment mandate;

	Traded pair	Expected figure	Deviation trigger
	USDCAD	0.2 (%)	±0.3 (%)

	Buy	USDCAD	if actual figure is or is below	-0.1 (%)
	Sell	USDCAD	if actual figure is or is above	0.5 (%)

Expected move during first 20 minutes after the release is 20 pips or more.


  Forexpathfinder Signals Trade Plan
 

	Traded currency pair	:	USDCAD
	Initial spike duration limit	:	15 seconds
	Initial spike price action threshold	:	10 pips
	Triggering retracement percentage	:	40 %
	Retracement duration limit	:	40 seconds
	Maximum trade hold time after release	:	15 minutes
	Stop loss	:	10 pips
	Take profit	:	10 pips
	Maximum spread	:	2 pips

1. If between 08:30:00am and 08:30:15am, so during the first 15 seconds you see USDCAD move up or down by 10 pips or more, then enter in the direction of the initial spike at the very first 40% retracement if it doesn't take more than 40 seconds (till 08:30:40am) – and if spread is at 2 pips or less. Set stop/loss at 10 pips, and set take/profit at 10 pips immediately.
2. If the move either up or down was less than 10 pips during the first 15 seconds, then the actual number of the report did not generate sufficient interest in the market, and you simply skip the trade.
3. If by 08:45:00am, so 15 minutes after the report release, neither your stop/loss nor your take/profit points were hit, then close the trade automatically at market price of the time.

Forexpathfinder Trade Plan

USA Nonfarm Payroll    -    8:30am NY time   (Friday, October 18)

PLEASE MIND GOVERNMENT SHUTDOWN! THIS EVENT CAN BE DELAYED!

	Traded pair	Expected figure	Deviation trigger
	USDJPY	179 (k)	±75 (k)

	Buy	USDJPY	if actual figure is or is above	254 (k)
	Sell	USDJPY	if actual figure is or is below	104 (k)

Expected move during first 15 minutes after the release is 50 pips or more.

Details:

 USA Nonfarm Payroll    -    8:30am NY time   (Friday, October 18)

--–––––————————————————————–––––--

	Traded currency pair	:	USDJPY
	Initial spike duration limit	:	30 seconds
	Initial spike price action threshold	:	25 pips
	Triggering retracement percentage	:	30 %
	Retracement duration limit	:	90 seconds
	Maximum trade hold time after release	:	15 minutes
	Stop loss	:	15 pips
	Take profit	:	15 pips
	Maximum spread	:	3 pips

1. If between 08:30:00am and 08:30:30am, so during the first 30 seconds you see USDJPY move up or down by 25 pips or more, then enter in the direction of the initial spike at the very first 30% retracement if it doesn't take more than 90 seconds (till 08:31:30am) – and if spread is at 3 pips or less. Set stop/loss at 15 pips, and set take/profit at 15 pips immediately.
2. If the move either up or down was less than 25 pips during the first 30 seconds, then the actual number of the report did not generate sufficient interest in the market, and you simply skip the trade.
3. If by 08:45:00am, so 15 minutes after the report release, neither your stop/loss nor your take/profit points were hit, then close the trade automatically at market price of the time.

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Trade Forex Like a Pro- Revealed the secret of the floor traders, How you will be successful trading forex using price. This is proven method tested that is making over $1,250 Monthly. No sorry, no complicated calculation. This is as simple as "ABC" B

Forexpathfinder News Trade Plan (Thursday, October 17)

What is news trading? How does forex news trading work?

Forexpathfinder News Trading can be extremely profitable if you have an understanding of fundamental analysis and have access to low latency forex trading software. Sounds too complex or expensive? Do not worry, Forexpathfinder analyst will help you to identify high-probability tradable economic news reports and advise on the trading strategy. You find all details on Here and if you want make pips easier you can find additional tools at Forexpathfinder Tactical Squad.

                                UK Retail Sales - 4:30am NY time (Thursday, October 17)

	Traded pair	Expected figure	Deviation trigger
	GBPUSD	0.5 (%)	±0.4 (%)

	Buy	GBPUSD	if actual figure is or is above	0.9 (%)
	Sell	GBPUSD	if actual figure is or is below	0.1 (%)

Expected move during first 20 minutes after the release is 20 pips or more.

 Note

	Traded currency pair	:	GBPUSD
	Initial spike duration limit	:	15 seconds
	Initial spike price action threshold	:	12 pips
	Triggering retracement percentage	:	35 %
	Retracement duration limit	:	40 seconds
	Maximum trade hold time after release	:	10 minutes
	Stop loss	:	10 pips
	Take profit	:	10 pips
	Maximum spread	:	2 pips

1. If between 04:30:00am and 04:30:15am, so during the first 15 seconds you see GBPUSD move up or down by 12 pips or more, then enter in the direction of the initial spike at the very first 35% retracement if it doesn't take more than 40 seconds (till 04:30:40am) – and if spread is at 2 pips or less. Set stop/loss at 10 pips, and set take/profit at 10 pips immediately.
2. If the move either up or down was less than 12 pips during the first 15 seconds, then the actual number of the report did not generate sufficient interest in the market, and you simply skip the trade.
3. If by 04:40:00am, so 10 minutes after the report release, neither your stop/loss nor your take/profit points were hit, then close the trade automatically at market price of the time.

Trade Forex Like a Pro Make $1500 Monthly

Trade Forex Like a Pro- Revealed the secret of the floor traders, How you will be successful trading forex using price. This is proven method tested that is making over $1,250 Monthly. No sorry, no complicated calculation. This is as simple as "ABC" B

High Forex Leverage Can Make Or Mar Your Profitability

Article Summary: Many Forex strategies focus on entry and exit signals of a trade. This article illustrates how traders can take the same signals, yet arrive at different profit amounts. Therefore, determining an appropriate amount of effective leverage is crucial to a comprehensive Forex trading plan.

Many traders focus all of their energy on finding the right entry and exit signal but still end up losing in the end. Today, I want to illustrate how two traders (Bob and Ed) place the same trading signals in their Forex account, yet end up with different equity amounts.

To keep the illustration simple, let’s look at a two trade series. Each trade has a 100 pip stop loss and a 150 pip profit target. The traders will lose on the first trade and win on the second trade. When you see the results on a score card, it would look something similar to this:

Trade results in pips

At the surface level, it looks like this trader is doing well. They are maintaining a positive risk to reward ratio, they have a good win ratio, and the number of pips collected on this series of two trades are positive 50 pips.

Now look at what happens to the account’s equity when Bob aggressively over leverages his account while Ed uses more conservative amounts of leverage.

Trader Bob

Starting Capital - $10,000

Account is set to 50:1 leverage. He thinks he is conservative and implements 40 times effective leverage.

	Trade #	Trade Size	Value per Pip	Trade Result	Profit/Loss	Acct Equity
	Trade 1	400,000	40	-100	-4000	6,000
	Trade 2	240,000	24	150	3600	9,600

Hypothetical results for illustrative purposes only.

Notice how Bob’s two trade sequence netted him +50 pips yet he lost $400 in his account. Obviously, the second trade had a much smaller trade size than the first, but when you over-leverage your Forex account, any losing trade damages your capital base to the point where you need to change your trade size or deposit more funds.

Trader Ed

Starting Capital - $10,000

Account is set to 50:1 leverage. Ed has gone through our Forexpathfinder EDU training materials and wanted to trade conservatively. He determined the appropriate amount of effective leverage for him was 5 times.

	Trade #	Trade Size	Value per Pip	Trade Result	Profit/Loss	Acct Equity
	Trade 1	50,000	5	-100	-500	9,500
	Trade 2	47,000	4.7	150	705	10,205

Hypothetical results for illustrative purposes only.

Ed placed the same trades as Bob and had the same starting account balance as Bob, but Ed implemented a more conservative amount of leverage. His trade sizes were 1/8 the size of Bob’s yet:

• Ed ended up with higher equity relative to Bob
• Ed’s net profit/loss (P/L) was positive while Bob’s P/L was negative

Two points to take away from this illustration.

1. When faced with a losing trade, high degrees of leverage destroy your capital base forcing you to change your future trade sizes or deposit more funds.
2. When using conservative amounts of leverage, your equity P/L tracks your net pips P/L

Though we place trades in hopes of it working out in our favor, we must also be prepared if it doesn’t. Part of that preparedness is a result of determining an appropriate amount of effective leverage. At DailyFX, we talk about using less than 10 times effective leverage. That way, when you are wrong on a trade, you still have the majority of your account capital remaining.

Written by Jeremy Wagner, Head Trading Instructor, DailyFX Education.

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Trade Forex Like a Pro- Revealed the secret of the floor traders, How you will be successful trading forex using price. This is proven method tested that is making over $1,250 Monthly. No sorry, no complicated calculation. This is as simple as "ABC" B

This Week Major Tradable Indicators - Online Forex Trading.

1. UK Claimant Count Change and Unemployment rate: Wednesday, 8:30. Britain’s unemployment rate narrowed unexpectedly in July to 7.7% from 7.8% in the preceding month, as the number of jobless citizens dropped by 24,000 to 2.487 million, the lowest jobless rate since September-November 2012. This was another indicator of the renewed strength in UK’s job market. Investors project that the job market improvement will continue and that the BOE will raise rates in December 2014. Bank of England Governor Mark Carney estimated that about 750,000 jobs would need to be added over the next three years for unemployment to fall to 7%. The number of jobless Britons is expected to decline by 24,300, while unemployment rate is predicted to remain unchanged at 7.7%.

2. UK Claimant Count Change and Unemployment rate: Wednesday, 8:30. Britain’s unemployment rate narrowed unexpectedly in July to 7.7% from 7.8% in the preceding month, as the number of jobless citizens dropped by 24,000 to 2.487 million, the lowest jobless rate since September-November 2012. This was another indicator of the renewed strength in UK’s job market. Investors project that the job market improvement will continue and that the BOE will raise rates in December 2014. Bank of England Governor Mark Carney estimated that about 750,000 jobs would need to be added over the next three years for unemployment to fall to 7%. The number of jobless Britons is expected to decline by 24,300, while unemployment rate is predicted to remain unchanged at 7.7%.


3.  US Unemployment Claims: Thursday, 12:30. The number of people applying for U.S. unemployment benefits soared by 66,000 last week to a seasonally adjusted 374,000. But the reading was skewed due to corrections in California and job cuts resulting from the government shutdown. However all in all the US labor market conditions are improving, despite recent volatility. A decline to 357,000 is expected now.

4. US Philly Fed Manufacturing Index: Thursday, 14:00. Factory activity in the U.S. mid-Atlantic region edged up to a 2-1/2-year high in September, reaching 22.3 from 9.3 in August. The reading was well above the 10.2 points anticipated by analysts. The gain occurred due to increase optimism about the near future. Respondents were also unusually optimistic, with the six-month business conditions index jumping to 58.2, the highest since September 2003, from 38.9 in August. A prior release from the Institute for Supply Management was also positive, showing the national factory sector grew at its fastest clip in more than two years in August. Philadelphia area manufacturing index is expected to decline to 15.4.

5.  Chinese GDP: Friday, 2:00. The world’s no. 2 economy is expected to show stronger growth in Q3: 7.8%. Growth stood on 7.5% in Q2. While many have doubts about the quality of Chinese data, this figure is closely watched.

6.  Haruhiko Kuroda speaks: Friday, 6:35. BOE Governor Haruhiko Kuroda will speak in Tokyo. He will probably address the US shutdown and its possible effects on the Japanese economy. His words will cause volatility in the markets.




*All times are GMT.

Trade Forex Like a Pro Make $1500 Monthly

Trade Forex Like a Pro- Revealed the secret of the floor traders, How you will be successful trading forex using price. This is proven method tested that is making over $1,250 Monthly. No sorry, no complicated calculation. This is as simple as "ABC" B

New Zealand CPI q/q - Tradable Indicator.

New Zealand CPI q/q is Change in the price of goods and services purchased by consumers;
 Released quarterly about 18 days after the about 18 days after the quarter ends;
 This is extremely late relative to inflation data from other countries, but it's the primary gauge of consumer prices and tends to create hefty market impacts.

 Why Traders Care
Consumer prices account for a majority of overall inflation. Inflation is important to currency valuation because rising prices lead the central bank to raise interest rates out of respect for their inflation containment mandate; The average price of various goods and services are sampled and then compared to the previous sampling nevertheless it is coming up 5:45pm NY time  (Tuesday, October).

How To Trade New Zealand CPI q/q

Traded pair	Expected figure	Deviation trigger
	NZDUSD	0.9 (%)	±0.4 (%)

	Buy	NZDUSD	if actual figure is or is above	1.3 (%)
	Sell	NZDUSD	if actual figure is or is below	0.5 (%)

Expected move during first 30 minutes after the release is 40 pips or more.


 New Zealand CPI q/q  will be next release on Jan 20, 2014

Enjoy your pips.


Trade Forex Like a Pro Make $1500 Monthly
Trade Forex Like a Pro- Revealed the secret of the floor traders, How you will be successful trading forex using price. This is proven method tested that is making over $1,250 Monthly. No sorry, no complicated calculation. This is as simple as "ABC"D

ZEW Economic Sentiment - forex trading.

A monthly economic survey. The ZEW Economic Sentiment is an almalgamation of the sentiments of approximately 350 economists and analysts regarding the economic future of Germany for the next six months. The survey shows the balance between those analysts who are optimistic about Germany's economic future and those who are not.

'ZEW Economic Sentiment in details'

The ZEW - Zentrum fur Europaische Wirtschaftsforschung (Center for European Economic Research) - Issues monthly economic reports for Germany, Switzerland, and the Eurozone.
These Economic Sentiment covers the economic futures of several other countries as well. This survey includes analyst opinions for Europe, the UK, Japan and the U.S. An index value greater than zero indicates optimism while a value below zero indicates pessimism

This indicator comes out once per month.  It has two components. The first component is called ZEW Economic Sentiment, and the second component is called ZEW Current Situation.

There is a German firm that surveys business authorities in all business industries, and it asks them questions about their current assessment and future outlook on German economy.
The questions about the future are compiled into ZEW Economic Sentiment, and the questions about current situation is compiled into ZEW Current Situation.

Germany is the country that has heaviest impact on Euro Zone, so naturally depending on how German economy is doing, traders speculate by trading Euro.  Since trading is based on predicting the future, ZEW Economic Sentiment is what matters the most to traders. When it comes out better than expected, it signifies healthier economy, so traders tend to buy EUR/USD, and it subsequently goes up. When ZEW Sentiment comes out worse than expected, it signifies a weaker economy, so traders tend to sell EUR/USD, and it subsequently goes down.



Enjoy your pips.

Trade Forex Like a Pro Make $1500 Monthly
Trade Forex Like a Pro- Revealed the secret of the floor traders, How you will be successful trading forex using price. This is proven method tested that is making over $1,250 Monthly. No sorry, no complicated calculation. This is as simple as "ABC"D

5 Most Predictable Currency Pairs

Every currency pair has a particular story, characteristics, behavior or misbehavior on the technical charts. Certain pairs will make a big breakout across clear lines of support and resistance and will not look back.  Or, when they aren’t able to break through, they will slow down and back off. Those are the more predictable currency pairs. Other currency pairs are more messy.
The reactions of pairs tends to shift over time: some become more predictable and some lose their style.  Here is an updated list of the most predictable forex  pairs, ranked and characterized.
Update: Here are the 5 most predictable currency pairs.

1. AUD/USD: The return of higher volatility and action in the markets makes the pair much more predictable. The pair respects uptrend and downtrend channels in a remarkable way, and also respects critical support and resistance lines. The pair’s predictability will likely be weaker in August when liquidity is lower, if no European news rocks the markets, but it is expected to shine during July and especially September, when there are is no liquidity shortage. In case of action in Europe during August, the Aussie will have the same behavior.
2. EUR/USD: One of the side effects of the euro-crisis are a more predictable euro/dollar.After breaking in a certain direction, the pair reaches a peak (or a bottom), marks it, and following moves in the same directions tend to challenge the same line. As we’ve seen in previous summers, this pair doesn’t take a break. The incessant news flow promises action all the time, and as it is the world’s most popular pair, liquidity is abundant. The pair doesn’t get the first place, as a major European event could rock the boat too strongly (see how to trade the Greek euro-exit) Yet also in such a case, it will be interesting to see if the pair will mark the bottom and re-challenge it, as it tends to do.
3. USD/JPY: This was traditionally a choppy and frustrating pair, but since the beginning of 2012, it is looking much better and even topped the list last time. The pair continues trading in clear ranges, often with double and triple tops. It is indifferent to the level of volatility. The pair behaves in a better manner when it is moving up.
4. AUD/CAD: This may not be the most exciting currency pair, but it might be a good choice for range traders, especially in slower days. This cross of commodity currencies can settle in a range for quite some time.
5. NZD/USD: The kiwi lost some of its mojo, but it still respects most old lines. Upon a breakout, resistance lines usually turn into support and vice versa. It came out first, and it could still rank higher, but not at the moment.

A few more notes:
GBP/USD had some good times, but it deteriorated later on, and dropped off the list.
Given the effective peg of the Swiss franc to the euro, USD/CHF moves in tandem with EUR/USD. Any franc crosses also move in tandem with their respective euro-pairs. So, unless the levee breaks, franc pairs are irrelevant.
EUR/GBP is very recently showing some positive signs, especially on the hourly chart, but the pair isn’t stable enough and could disappoint during the summer.

Trade Forex Like a Pro Make $1500 Monthly
Trade Forex Like a Pro- Revealed the secret of the floor traders, How you will be successful trading forex using price. This is proven method tested that is making over $1,250 Monthly. No sorry, no complicated calculation. This is as simple as "ABC"D

Forex Trading Strategies - Investing Versus Trading

By Henry Liu

One of the most important yet often ignored questions that all Forex traders should ask themselves, especially retail traders, is “what’s my goal?” or “what’s my endgame?”

Yes, it may seem absurd to bring this up at this stage of my 7-part series, but how many traders actually examine what do they really want from Forex?  Now, we are not talking about fantasy land here, but something realistic and achievable… and after you really thought through it, I think it comes down to either income replacement, or income supplement…  Of course, there are always those who want to strike it rich overnight, but I think you probably have a better chance at playing the lottery, because it takes just one combination of winning numbers to win millions of dollars, versus having series of winning trades, excellent mental discipline, and perfect timing to achieve your goal.  The odds are just astronomical; so yes, you’d have better odds at playing the lottery than trading Forex starting with a $500 investment and the explicit goal of turning it into $1 million.

Now that we get the myth out of the way, let’s understand the difference between Trading and Investing.

Trading – according to Investorword: is the buying and selling securities or commodities on a short-term basis,  hoping to make quick profits.
I think the key focus is “short-term”, as traders often enter and exit trades within minutes, hours, but very seldom, days.  News trading, straddling, scalping, all describing different types of trading with a short-term focus; as a matter of fact, most traders, especially the novice ones, tend to focus on this type of Trading, or in and out of the market on short-term basis.

Investing – on the other hand, is defined by Google as:

1. Expend money with the expectation of achieving a profit or material result by putting it into financial schemes, shares, or property, or by using it to develop a commercial venture.
2. Devote (one’s time, effort, or energy) to a particular undertaking with the expectation of a worthwhile result.

Obviously investing is not short-term, but rather longer term ventures with goals of achieving profits that are worthwhile.
If your goal in Forex is income replacement or supplement, I’ll show you a way through investing to build up your portfolio.  If your goal is to gamble your account with expectations of huge returns, then the following may not interest you, however, you are welcome to follow along, because what you are about to read could change your Forex Trading forever.

Unless you are already a successful Forex trader, you may still make the same mistake: Closing profitable trades early while let losing trades run…  This is of course, human nature, and it is as true as gravity, because your brain is programmed to go to the path of least resistance.  A normal trader usually feels that taking a small profit is easier than taking a small loss… In a study into positive/negative framing, traders are usually biased against taking losses, even when logic states otherwise.  I’ll get into details in the final chapter of Forex Trading Strategies, but for now, just know that if you give a choice to 100 traders to take a loss of $3000 now, or $5000 later, but with a 10% of probability that market could come back to break even, 85% of traders would choose the $5000 or no loss scenario, when in fact the $3000 loss is the right choice mathematically.

The same applies to winning trades, and if we were to change the context, let’s say to either take profit on $3000 now, or $5000 later, but with 10% chance of making nothing, 85% of traders would take the $3000 scenario, leaving money on the table because of the fear in losing what you already have.  And in order to transform your thinking from trading to investing, we need to learn to do what’s hard, because if you are doing what 85% of traders are doing, you’ll end up with the same results of what 85% of traders are getting, and that’s losing…

And that brings us to the concept of Long Term Trades, or what I call: Currency Investment, or leaving your winning trades run. The idea behind the long-term trade is simple, trade based on major market developments, and once you are in the trade, stay in it until you have reasons to get out.  Start with a very small percentage of your account, preferably taking positions in the pair that will give you positive daily swaps, and then add more positions as the market goes in your direction.  Here are the specifics:

1. Study the market and wait for major breaking news that could change the entire market.  News like the Lehman Brothers, ECB Press Conference, Japan’s PM Abe’s snap election…  all of these news releases change the overall sentiments of the market and affect one or several currencies.
2. Choose a currency pair in the direction of the news that would yield positive daily swaps, or cost you less daily swaps.  If the swaps are mostly the same, choose the pair with the most liquidity (less spread), as it’ll end up costing you less.
3. Follow the market and start with a very small position, no more than 2x to 3x leverage.  Something that you can afford to leave running without losing sleep. If 2x leverage is still too much, take half of that.  (2x leverage is basically twice of your available balance.  If your available balance to trade is $10,000 USD, then 2x leverage would be $20,000 USD, or 2 mini lots.)
4. Once you are up 100 pips or so, move your stop loss to break even, and wait for the inevitable market retracement and add another 2x leverage position.  Note: As a rule of thumb, wait for market to retrace at least 100 pips from the high, then plan your entry.  Use previous Forex Trading Strategies such as Support/Resistance and Market Timing as your guides to enter.
5. Repeat step 2, 3, 4 and continue to add more small positions until you have reasons to get out of the trade.  Usually when a move like this happens, it is possible to see the trend last 3 months to 18 months.

These small positions could amount to huge profits in the long run.  I have accumulated 30+ positions on a trade with the first position giving me in excess of 1500+ pips of gain, and I have seen people with 10,000 pips of gain on one trade of shorting GBPJPY from 250.00 down to 150.00.  Even if you enter half of that, you will end up at least doubling your account with very little risk…  Remember, Rome is not built in one day, nor is your Forex portfolio.

Last but not least, let me share with you what kind of news you should paying close attention to… The kind that moves the market!  At the time of writing this strategy, market is particularly sensitive to whatever has to do with QE or Quantitative Easing.  Market is expecting the ultra easy policy to continue, so the next sharp move would take place when central banks stop QE, and that would signal potential concerns for inflation, which will lead to rate hikes.  So the first major central bank, ECB, Federal Reserve, Bank of Japan, or PBoC to talk about ending QE and hiking rates

What Should You Do When Your Online Forex Trading System Fails?

Forex trading systems cannot stay unchanged for too long. Market conditions change constantly and a winning system will eventually start losing. Sticking to the old system while hoping for the winds to change will likely end with a test of the depth of your pockets.
So what can you do?

Assuming that you are generally happy with your system, there are a few things you can do. It’s better to try some back testing, and then demo trading before making these changes on your real account.

• Switch to a higher time frame: Trading could become so choppy and “noisy”, in a way that your kills your system. On higher time frames, your system could work in a better manner.
• Switch to another currency pair: If you always stick to the same pair, perhaps the behavior of one of the currencies in the pair has changed, while the other hasn’t. Switching to crosses can be an alternative to the noise created by US events.
• Modify Stop Loss / Take Profit parameters: This is a small tweak that can make a big difference. It’s important to stress that you keep a normal risk/reward ratio and that you don’t extend the stops while you are trading.
• Remove one of the indicators: Too many systems use too many indicators. This complicates matters and makes it hard to understand why you won a trade and why you lost one. You might have the instinct to add another technical indicator to add extra validation. As aforementioned, this could only make things worse. Try refreshing your graph with one indicator less.
• Begin testing a totally different system: After already trying to make the necessary tweaks to your system, perhaps it’s time to acknowledge it doesn’t work and to seek a new one.

Basics of Forex Economic Indicators

This tutorial highlights some of the Forex economic indicators that will be able to guide the trader’s path in understanding financial and economic data.
Some indicators are very important for certain markets, e.g. Non-farm payroll releases in the US, and others may not be as important.
Guest post by Alexander Collins

Financial Data that Affects Currencies
Economic indicators are signals that provide guidance to the underlying data. This information is critical for traders to make buy and sell decisions. Financial economic indicators also describe the condition of the country’s economy and its impact on currencies.
Various governments and private financial organizations release economic data from time to time. This is part of public policy to keep everyone informed of changes to the country’s economy. These releases adhere to set schedules and traders keep watch for these pieces of data to make decisions.
The release of important indicators often results in increased trading volume and activity that in turn affects currency markets. Analysts will provide reams of information related to these indicators but traders do not need to have great theoretic knowledge to judge their importance.

Schedules of Indicators
Since the release dates and times of economic indicators are known in advance, traders generally track them closely. There are many online and offline media that will have this data instantly updated. Many trading software can automatically alert traders to the new data coming out. Also, many online brokers and dealers highlight them on their websites instantly.
Forex economic indicators represent several underlying economic data such as a country’s Gross Domestic Product (GDP), employment statistics such as non-farm payrolls, and other vital information such as Consumer Price Index that is an indicator of inflation in the country. Every indicator is useful in gauging the country’s economic pulse and how it will impact its currency in relation to others.
Traders can be overwhelmed by the barrage of economic data that is continuously being released by all the countries in the world. It is important to learn which of the economic indicators are critical important and which can be ignored. Some of the closely followed indicators that have a known effect on markets are the Non Farm Payroll data from the US, GDP figures and Central Banks’ Interest Rate changes.

Analyzing
Economic indicators dealing with inflation data such as CPI are important when related to certain countries but not to others. As the US dollar is a key driver in the Forex markets, any indicator that relates to the US or its Federal Reserve is watched alertly by traders. And known as the market movers in a big way, so it is good to anticipate them.
Forex economic indicators are universally available to traders but each trader may judge them in their own special way. There is always more than one opinion to analyze any of them. If traders feel positively about it, they will buy the underlying currency, or else sell it. This leads to major volatility in the market since traders want to make most of the opportunity generated by the release of an economic indicator.

Anticipating
Many of indicators are anticipated by market analysts and financial gurus. They try to predict these numbers based on their study of the economy. Many traders follow these predictions. When a released is quite different from the anticipated figure then it can cause quite a bit of volatility. Traders try to come to grips with the changed situation and assess their own exposure to the Forex market.

Example
For example, let’s say the prediction was that Non-Farm Payrolls would register a net gain of 10,000 jobs. Traders tend to position themselves in the market for this outcome. However, if the actual data came out as net loss of 25,000 jobs, there would be a wave of shock in the trading community. Such unexpected releases are common. Traders who were exposed to the market would immediately wish to liquidate their positions. This causes a run on the short side for the US dollar, with the exchange rate literally falling to the floor rapidly.
Some of the surprises in Forex economic indicators are related to revisions in data posted earlier. Governments and other organizations frequently revise older data based on any new information they receive. This impacts the current economic indicators, so traders are advised to look at these older revisions to understand the causes for the unexpected changes.
Economic indicators are a very big help for traders to develop their trading strategies. Traders must be aware of the schedule of the releases of financial data as these will have an effect on their already open positions. Traders have to follow Forex economic indicators especially for the countries whose currencies they regularly trade to gauge the outlooks of their respective economies.
This guest post is submitted by Alexander Collins, a forex software developer and trader. To compliment your reading, he offers to download free tools for MT4 at http://pipburner.com/free-forex-trading-tools/. For example, you will find there FX Pulse – trend detecting and news reading indicator.

Four Important Trading Skills You Need In Online Forex Trading.

Even if there are many important things you will learn from a forex school, there are still many essential skills that you may not get from your forex education. This is not to denigrate the value of formal education in currency trading, but rather to stress the limits of this training.
When you are actually trading with real money, there are many practical skills that you will need in order to avoid losing all your trading capital. Of course, there may be opportunities for you to learn some of these skills if the school offers mentorship programs or supervised trading opportunities. Here is a short overview of some of these skills.

1. Risk management. Every time you open a trade, there is always a chance that it will go against you and you will lose your money. Because of this, you will have to develop risk management skills that will help you to deal with the risk so that you’ll be able to navigate it successfully. One example of managing risk is to limit the amount of money you will risk per trade to a certain percentage of your trading capital. This will limit the amount of your losses in case you make unsuccessful trades. Of course this does not prevent you from increasing the amount ventured on your trades in case you feel the market is in your favor.
2. Developing a trading mindset rather than a gambling mindset. One of the worst things that you can do as a trader is to let your trade run rather than closing it out when it begins to go against you. A trader would accept that a trade is unsuccessful and accept their loss while a gambler would let the trade continue to run in the hope that it will eventually reverse itself in the trader’s favor.
3. Learning patience. It takes time to learn how to trade successfully and the trader should accept this rather than believe that after only a few courses, they will be successful at once. Apart from the lessons they will learn from the Forex school, they will also have to spend hours of practice making paper trades before they go and make actual money trades. It is said that it takes 10,000 hours to become proficient at something, and you will have to put in the time required to develop into a successful trader since it will not happen overnight.
4. Taking the long term view. Most beginning traders mistakenly believe the hype that the currency market is a place where you can make a fortune virtually overnight. Any good forex school will inculcate in their students the basic lesson that it takes time to make money. Attempting to make a big amount of money at once in the markets can only end in disaster unless you’re really lucky. Keep in mind that the only way to earn substantial profits from the forex markets is to trade using leverage, but this also greatly increases the amount of money you can lose.

The Process of Online Forex Trading Successfully

The primary reason most Forex traders fail is that they ignore the process.
In today’s world of quick-fix solutions, drive-thru menus, and expedient transportation, we want everything NOW. In our “convenient culture” we have come to expect results right away, putting aside the basic principles of online forex trading. “I’ll have a Big Mac, biggy-sized, with 10 milkshakes, and a vanilla latte!” Instantaneously, our ears hear the delightful words “Coming right up!”

When you ask for Online Forex Trading success, do not expect a “coming right up!” response. Online Forex Trading is not a get-rich-quick method. If you approach it as one, you will almost inevitably get-poor-quick. Forex Trading involves work, it requires a process. Let us view The Process of Forex Trading together.
Prepare 
Process is defined as: “A series of actions or steps taken to achieve an end.” The first step in the process of becoming successful at Online Forex Trading is to prepare. The preparation I am referring to is financial preparation, having the financial security to invest money that you can afford to lose.

Do not invest money that you can not afford to lose. Do not invest your last $2,000 in hopes of acquiring some much-needed cash for the bills next month. If you trade with funds that you can not afford to lose, the emotional pressure of trading will become so immense and intense that the likelihood of you losing your funds increases exponentially.

Risking you and your family’s financial welfare is never a wise decision. If you are currently not in the financial position to participate in Forex Trading, establish a goal to be financially secure by this time next year. Therefore, you can be confident in your future investing and you will value that investment substantially more than you would if you had not intently and purposefully worked and planned for it.
Without the foundation of financial security, your “wealth house” is exceedingly vulnerable to the storms of the Forex market.

Plan
Winston Churchill said it best; “He who fails to plan is planning to fail”. Having a trading plan is critical to anyone desiring success in Forex trading. Without a plan, any money you do succeed at acquiring, you can expect to succeed at losing very quickly.

Your trading plan consists of your trading vision, goals, and strategy (strategy being your parameters and plans on meeting your goals to accomplish your vision). It is critical to have these three essentials in your Forex trading plan. Your vision will keep you going, even when you fail miserably. Your goals will let you know that you are, or are not, making progress in regards to your vision. The Forex strategy is what you execute to actually see the trading results.
If you exclude any of these three essentials, your plan is ineffectual. A vision without a strategy is a fantasy. A goal without without a vision is insanity (similar to the Fed’s current unlimited Quantitative Easing).

Perfect
Now it is time to trade! Step one in trading: open a demo account. “Demo!? I want live!” Be patient my friend, this is a process!
It is now time to perfect your plan with demo trading. Demo trading can often be viewed as a toy for amateurs, but it is actually a wonderful Forex trading tool for those serious about developing into successful Forex traders.

In this stage of the process you will realize the faults with your plan and tweak them. You can try different plans and compare results. This stage of demo trading may last for many months, if you are not profitable trading with a demo account, chances are low that you will be profitable over the long-term trading a live account.

Perform
Now it is time to trade live. Your long awaited day has arrived. It would be wise to start with a smaller sized account and progress accordingly. You are now consistently trading your “perfected” strategy with discipline. Never feel obligated to enter a trade, but when you do, enter within the boundaries of your Forex trading plan.
One of the most difficult exploits of traders is trading detached from emotions. This is one reason why trading a demo account is so critical. By trading a demo account, you can train yourself to not be ruled by your emotions.
Investors of all kinds are constantly exposed to emotions as they trade, day traders especially. Emotions are good and obviously understandable when it comes to money, but letting them rule your Forex trading is a very dangerous position to be in. You have a choice to make: let your trades be governed by your Forex trading plan or let your trades be governed by fear, greed, and other emotions.
As you perform and execute your trading plan on a live account, you will inevitably find faults. If you notice your plan has stopped succeeding, don’t panic, it’s okay. You can always back up a step to “perfect” your plan further. Consistent, strict adherence to your trading plan ought to always be present in your Forex trading. On the other hand, flexibility is also an essential, understanding that the market is ever-changing.

Prosper
Being the largest market in the world, the Forex market contains endless opportunities for creating wealth. You are now part of the remnant of profitable Forex traders. As Forex trading functions as a stream of income for you and your family, you are now faced with more choices. Should I add funds to my account? Start a new account? Diversify? Save all the profit? The opportunities are endless, the hard work has paid off, and the price of the process was worth it.
Forex trading is not a sophisticated lottery mechanism nor a get-rich-quick scheme. Please do not let greed lead you into skipping steps in the Forex trading process. Good things are worth waiting for. Persevere through the process. If your Forex trading journey has been disappointing so far, you are not alone. Get your head up, start the process from step one and do it the right way. Let’s make 2013 a year where we follow the process, positioning ourselves for long-term wealth creation.

Top 5 Characteristics of a Successful Online Forex Trader

Not anybody can be a Online Forex trader. Trading occasionally, as a side income or professionally requires certain skills and characteristics.
Are you up for it? Here are 5 critical traits that any trader needs.

1. Seeing the big picture: Are you able to separate the small details from the bigger picture? This is critical in two aspects. First, separating the current movements from the bigger trend. The second aspect relates to money management: being able to separate your current trade from the situation in your account and the bigger plan.
2. Patience: Too many traders lack the patience to educate themselves before jumping into a trade, or don’t wait for a really good opportunity, as Andriy mentions. Others don’t wait long enough for their trade to run its course. Or, upon meeting success, they have the patience to continue trading in the same position sizes, and quickly double the positions, hoping to win more but actually burning their account fast.
3. Being able to adapt: Market conditions change all the time, and a good trader needs to be able to adapt. Your trading system cannot work well forever. Changes in patterns occur all the time, and you’ll need to tweak the system, if not completely change it. Being able to adapt also applies to fundamental analysis: strong currencies may hit the wall when the tide turns against their respective economy. A weak currency can help a country’s economy recover over time.
4. Cautiousness: When uncertainty is high in the markets, a good trader will be extra careful when taking risks. This means focusing on more predictable currencies, lowering position sizes when necessary or even taking a break from the markets. Winning in forex trading isn’t limited to making winning trades, but also minimizing losing ones.
5. Identifying your weaknesses: If you are able to be fully aware of your weaknesses, you are half the way to solving your problems. All the important traits mentioned above will be closer to reach if you can see when you are too far from them and acknowledge them. Your basic character will not change, but you’ll still adapt better to changing conditions and you’ll be able to stay a bit more patient than usual.

What traits are important in your opinion? Can you identify your strengths and your weaknesses?

The Hiden Truth About Relative Strength Index(RSI): Online Forex Trading.

Relative Strength Index, or RSI, is similar to the stochastic in that it identifies overbought and oversold conditions in the market. It is also scaled from 0 to 100. Typically, readings below 30 indicate oversold, while readings over 70 indicate overbought.

How to Trade Using RSI

RSI can be used just like the stochastic. We can use it to pick potential tops and bottoms depending on whether the market is overbought or oversold.
Below is a 4-hour chart of EUR/USD.

EUR/USD had been dropping the week, falling about 400 pips over the course of two weeks.


On June 7, it was already trading below the 1.2000 handle. However, RSI dropped below 30, signalling that there might be no more sellers left in the market and that the move could be over. Price then reversed and headed back up over the next couple of weeks.

Determining the Trend using RSI

RSI is a very popular tool because it can also be used to confirm trend formations. If you think a trend is forming, take a quick look at the RSI and look at whether it is above or below 50.
If you are looking at a possible uptrend, then make sure the RSI is above 50. If you are looking at a possible downtrend, then make sure the RSI is below 50.

In the beginning of the chart above, we can see that a possible downtrend was forming. To avoid fake outs, we can wait for RSI to cross below 50 to confirm our trend. Sure enough, as RSI passes below 50, it is a good confirmation that a downtrend has actually formed. 

Bollinger Bands As Online Forex Best Scalping Indicator.

For better understanding am going to compare trading to building a house. You wouldn’t use a hammer on a screw, right? Nor would you use a buzz saw to drive in nails. There’s a proper tool for each situation.
Just like in trading, some trading tools and indicators are best used in particular environments or situations. So, the more tools you have, the better you can adapt to the ever changing market environment.
Or if you want to focus on a few specific trading environments or tools, that’s cool too. It’s good to have a specialist when installing your electricity or plumbing in a house, just like it’s cool to be a Bollinger Band.

There are a million different ways to grab some pips! and Bollinger Bands is one of the best especially on scalping.
Bollinger Bands, a chart indicator developed by John Bollinger, are used to measure a market’s volatility.
Basically, this little tool tells us whether the market is quiet or whether the market is LOUD! When the market is quiet, the bands contract and when the market is LOUD, the bands expand.
Notice on the chart below that when price is quiet, the bands are close together. When price moves up, the bands spread apart.

   
That’s all there is to it. Yes, I could go on and bore you by going into the history of the Bollinger Band, how it is calculated, the mathematical formulas behind it, and so on and so forth, but I really didn’t feel like typing it all out.
In all honesty, you don’t need to know any of that junk. I think it’s more important that I show you some ways you can apply the Bollinger Bands to your trading.
Note: If you really want to learn about the calculations of a Bollinger Band, then you can go to www.bollingerbands.com.

The Bollinger Bounce

One thing you should know about Bollinger Bands is that price tends to return to the middle of the bands. That is the whole idea behind the Bollinger bounce. By looking at the chart below, can you tell us where the price might go next?

If you said down, then you are correct! As you can see, the price settled back down towards the middle area of the bands.

What you just saw was a classic Bollinger Bounce. The reason these bounces occur is because Bollinger bands act like dynamic support and resistance levels.
The longer the time frame you are in, the stronger these bands tend to be. Many traders have developed systems that thrive on these bounces and this strategy is best used when the market is ranging and there is no clear trend.
Now let’s look at a way to use Bollinger Bands when the market does trend.

Bollinger Squeeze

The Bollinger Squeeze is pretty self-explanatory. When the bands squeeze together, it usually means that a breakout is getting ready to happen.
If the candles start to break out above the top band, then the move will usually continue to go up. If the candles start to break out below the lower band, then price will usually continue to go down.

Looking at the chart above, you can see the bands squeezing together. The price has just started to break out of the top band. Based on this information, where do you think the price will go?

If you said up, you are correct again!
This is how a typical Bollinger Squeeze works.
This strategy is designed for you to catch a move as early as possible. Setups like these don’t occur every day, but you can probably spot them a few times a week if you are looking at a 15-minute chart.
There are many other things you can do with Bollinger Bands, but these are the 2 most common strategies associated with them.

Advancing online forex trading in Nigeria

I can vividly recount the advent of online forex trading in Nigeria. If I am that correct, I can date it back to 2006/2007. Laudable idea! Like any new business, Nigerians took to it en masse. But regrettably, it was a rush in, rush out thing.

The bane actually was lack of technical, experienced personnel to impart knowledge, direct and mentor trainee traders. I could recall a trainee of mine whom without a month experience opened a training centre on forex trading. He has crashed out permanently now.

Forex trading is lucrative but it requires sound knowledge and discipline. I am taking you through this because I have a vision to really impart knowledge to the populace as a contribution to self-empowerment programme and self-employment as well.

But what really brought about this article is that when you decide to empower people, you directly or indirectly empower yourself. The feedback is one of this. One of my trainees over the weekend was on a website. A site I had shown them for fundamental and technical analysis and also economic snippets that affect forex market. He went under the education link and called me to alert me about a forex expo called Lagos Forex Expo and Conference, scheduled for the later part of this year. The first of its kind in Nigeria in the commercial and financial hub of Lagos. He pressed on me that he would like me to present a paper there as he sees my efforts in advancing the course of forex trading in Nigeria.

I went to the site and looked up what the expo will have for traders. But in the process, what struck me is the statistics of traders given there, which I guess the organisers must have done some serious homework to lay to that claim. It says there are over 300,000 active traders in Nigeria. That is a staggering figure to my amazement despite the hues and cries about online forex trading. With Nigerians, I know the geometric progression of this figure will soon be bloated. I also smiled to myself that I have been part of that contribution in terms of the response this column has generated since its debut.

Secondly, I read that the Securities and Exchange Commission is giving a backing. That will put a paid stamp to doubtful minds about the authenticity of forex trading in Nigeria and I look forward in due time for foreign brokers to give more recognition to us here in this part of the world, once our regulatory authorities come up with rules and guidelines. The influx of brokers will be better for our economy and will provide more jobs and opportunities.

Even though I do not hold the brief for the upcoming Lagos Forex Expo organisers, as a trader/trainer/market analyst and signal provider, I know it will do a lot of good to this profession. The line-up of invitees will definitely shore up the image of the career as it will bring together traders, trainers, agents, brokers, investors, financial institutions, government agencies and many others. The benefits will really be tapped into by a lot of Nigerians. It will definitely be a good turn around. I wish the organisers well and also congratulate those in this business/career for a ground breaking event.

Market analysis for October 7, 2013 (as of the time of finishing this article. Entries are at trader’s discretion and money management is advised). Analysis discrepancies may result due to forecast time and economic news.