posted by on Sep 5
Sometimes called “trading between the lines”, this is one popular approach
Forex Trading - Pivot Points
Sometimes called “trading between the lines”, this is one popular approach. Traders wait for the reversal of the trend off a resistance point, then sell.
posted by on Sep 4
Many of the common charts encountered in the toolkit of Forex traders are composed of a graphed series of technical indicators
Forex Trading - Technical Indicators
Many of the common charts encountered in the toolkit of Forex traders are composed of a graphed series of technical indicators. So, in order to understand those charts, the student of Forex investing will do well to study those indicators.
Fortunately, it isn”t necessary to know exactly how to calculate them in order to use them. Software will do that for you. But, it”s helpful to have some idea of how they are arrived at, and what they mean, in order to evaluate their worth as trading tools.
Keep in mind, however, that none of the indicators - taken alone - tell the whole story. Nor do all of them together make one certain. Indicators are just that, they indicate. They do not predict with certainty. No mathematical tool used in Forex trading will do that. Beware of hyped promises.
posted by on Sep 3
Forex Trading - Currency Trading vs Stock Investments - The title points up an important difference between forex and stock investing.
When buying stocks you”re making an investment in a company. Buying shares is short for “purchasing a share of ownership”. By contrast, no one is making an investment in Japan by buying yen. We leave aside politically motivated actions by large central governments. Currency is exchanged in order to facilitate the movement of goods and the payment of services between multiple countries, but that”s a relatively small percentage of the total $2 trillion daily volume. The largest amount is simple speculation.
Well, perhaps not very simple. Trading euros against dollars against yen against pounds against… in a twenty-four hour market with a dozen time zones… it gets complicated.
posted by on Sep 2
Many of the common charts encountered in the toolkit of Forex traders are composed of a graphed series of technical indicators
Forex Trading - Technical Indicators
Many of the common charts encountered in the toolkit of Forex traders are composed of a graphed series of technical indicators. So, in order to understand those charts, the student of Forex investing will do well to study those indicators.
Fortunately, it isn”t necessary to know exactly how to calculate them in order to use them. Software will do that for you. But, it”s helpful to have some idea of how they are arrived at, and what they mean, in order to evaluate their worth as trading tools.
Keep in mind, however, that none of the indicators - taken alone - tell the whole story. Nor do all of them together make one certain. Indicators are just that, they indicate. They do not predict with certainty. No mathematical tool used in Forex trading will do that. Beware of hyped promises.
posted by on Sep 1
to move back toward the pivot point.
Of course, this approach has to be viewed with some skepticism, as most strategies should be. Resistance and support points are broken all the time - that”s
posted by on Aug 31
The RSI, or Relative Strength Index, is a value between 0 and 100
Commonly used Technical Indicators - RSI
The RSI, or Relative Strength Index, is a value between 0 and 100. A number above 70 usually suggests that a currency is overbought and therefore due for a price reversal. A value below 30 indicates a currency is oversold.
As a price is making a new high, but the RSI fails to surpass its previous high, the trend is said to “diverge”. This often indicates an impending reversal of the trend. When the RSI dips below a recent bottom, it is said to have executed a “failure swing”. That move is seen as tending to confirm the impending price reversal.
posted by on Aug 30
There are several other common indicators, including MACD (Moving Average Convergence/Divergence), Momentum, OBV (On Balance Volume), Money Flow Index, Parabolic SAR, Stochastic Oscillators and dozens even more esoteric
Commonly used Technical Indicators
There are several other common indicators, including MACD (Moving Average Convergence/Divergence), Momentum, OBV (On Balance Volume), Money Flow Index, Parabolic SAR, Stochastic Oscillators and dozens even more esoteric.
All these were developed as statistical tools to help predict prices and trends. But keep in mind that, though some technical analysts claim to eschew looking for causes, all of them are based on assumptions when used as technical indicators.
As with any tool, they should form part of a strategy for trading. They should not be used as a substitute for studying the market and using proper risk management.
posted by on Aug 29
Beyond attempting to evaluate trends, pivot points can be used as part of an entry and exit strategy
Forex Trading - Pivot Points
Beyond attempting to evaluate trends, pivot points can be used as part of an entry and exit strategy. An investor might choose to place an order to purchase a
posted by on Aug 28
An investor will need to become familiar with new phrases and quoting methods - pips, spreads, cable and the like. Calculations formerly carried out with ease will now need a little more thought. Everyone is used to their own currency and seeing a $10 stock go up by a dollar one immediately sees a 10% gain. Trading currencies requires a little more knowledge.
posted by on Aug 27
Forex Trading - Currency Trading vs Stock Investments - The title points up an important difference between forex and stock investing.
When buying stocks you”re making an investment in a company. Buying shares is short for “purchasing a share of ownership”. By contrast, no one is making an investment in Japan by buying yen. We leave aside politically motivated actions by large central governments. Currency is exchanged in order to facilitate the movement of goods and the payment of services between multiple countries, but that”s a relatively small percentage of the total $2 trillion daily volume. The largest amount is simple speculation.
Well, perhaps not very simple. Trading euros against dollars against yen against pounds against… in a twenty-four hour market with a dozen time zones… it gets complicated.