EuroZone Economic History

I have spent most of my screen time trading EURUSD. Therefore, I need to catch up with the newest update possible on what happen to Eurozone.

It will not guarantee our trading success, however keeping an eye for economic event in your chosen currency is crucial.

You can find the source of this image on Business Insider

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Infographic: Forex Industry on A View of Graphic Designer

I really like infographic. It is a poster-like graphic, designed specially to deliver a message of something very complicated such as forex, finance, statistic and any technical terms with ease.

The main purpose is to keep it simple. What I like most about it is, when I read or look at an infographic, It is like I am reading a story.

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Forex Trading Cheat Sheet for News Trader

“I was thrown out of college for cheating on the metaphysics exam; I looked into the soul of the boy sitting next to me.”

Woody Allen

Henry Liu Forex from HLFX Network is releasing the newest News Trigger sheet for forex trader.
As we know, the economic calendar is crucial for forex trading business.

Because news moves the market.

We can see the list of news release per day on Forex Factory or DailyFX.
But, trading the news release is not without problems.

Most common misunderstandings when using economic calendar:

• I just need to see the forecast versus the previous, if the forecast is better then the currency will be stronger. Of course not, what we really need to see is the actual release versus the forecast.
• If the news is bad for U.S Dollar, then we BUY EUR/USD. Not quite, this is where the market context* concept gets in. 
• If the actual news release is better than the forecast, then the currency will be stronger. Not every release will give significant changes to the currency even if it is in red (high impact news). We need to see the deviation between the actual and the forecast. The wider the deviation, the wilder it moves.
• Every high impact news release will always impacting the market. 

*there are 2 market context: RISK APPETITE (optimist) and RISK AVERSE (pessimist).

Whenever the market is in risk appetite mode, then every good news will increase the demand on risky financial instruments such as: stocks, euro, sterling and aussie dollar because their yields are higher than the U.S dollar.

On the other hand, when the market is in risk aversion mode, every bad news from the market will make investors and institution to allocate their assets into safe haven: gold, U.S dollar and Japanese Yen.






What will this cheat sheet do to you:

1. Henry already filtered the tradable news for major currency. There are literally hundred of news, but not all of them will move the market. The news on the list comes from Henry Liu years of research on news which give most desired impact.
2. Even the filtered news won't always give us the opportunity to get decent profits. Therefore, he also provided the deviation (Tradable Trigger). So, the actual news release of U.S Non Farm Payroll should deviate +70k or -70k from the forecast.
3. Once the deviation hit (triggered) then, we may expect that the market will moves in certain range.

After you download it, it is better for you to study it first. The best way is to subscribed to HLFX Network.

Henry will send you the recommendation using the trigger cheat sheet, plus his commentary.

It has saves me a lot of trouble looking for news to trade.

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How to Escape from Hedging Position

"No performer should attempt to bite off red-hot iron unless he has a good set of teeth."

Harry Houdini

Houdini Escape

Hedging is a situation where there are opposite positions in our trade. LONG and SHORT simultaneously.

This results in:

Locked the profit or loss. The price movements will no longer affect the equity.

(I am not talking about martingale technique)

WHY TRADER HEDGE?

I know that hedging is not supposed to be a strategy in managing risk. Because, it may cost even more than just merely cut the loss short.

More further NFA, National Futures Association is already inhibited the use of hedging.

Refer to the above statement of Houdini, means that you are better off without it.

There are 4 ways to escape from hedging. Understanding the philosophy and calculation is the first step upon escaping locked trade.

CUT THE PROFIT FIRST

When you hedge your position. Means that you have LONG and SHORT positions at the same time. One position may have profit and the other, loss. 

It is also possible that both of your positions show negative. It is because the running price is trapped between your long and short position. If that happens, you may want to wait until one of them shows better result.

To help you understand why you need to cut the profit first, is to learn the Reversal Trading method. 


We will not cut the profit right away. 

We will wait until the position to reach the peak and ready to reverse. That's is where we cut it and let the reversing's move results in addition to our equity.

CUT THE LOSS

To cut the loss is a completely different idea. You need to understand Breakout Trading Method to utilize this strategy.

If you the market is going to a certain direction according to breakout principles, then you may want to cut any positions opposite to it and let the profit run.

ADDING A NEW POSITION

And please, don't lock it again.

By adding a new position, we assume that there is no hedging position. Once the new position enable us to gain few pips to cover the loss, we may exit all the position at once.

CUT THEM BOTH

It takes courage. And courage pays.

I can't not emphasize it even more, plan your trade and trade your plan.

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Forex Weekly Anticipation: June 12, 2011

Recently, I subscribed to Phillip Nel, 4 Hour MACD Strategy weekly anticipation. He sent me the video about trading anticipation of the week using daily and 4 hour chart. If you want it too, you may visit Philip Nel's Website.

The video also captured the successfully confirmed head and shoulder formation on EUR/USD chart, June 11 2011. For further understanding about the video, you should learn about the simple methodology of 4 Hour MACD strategy.

Besides EUR/USD, he also posted his weekly anticipation on the other major currencies such as AUD/USD, GBP/USD dan USD/JPY.

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Dare To Dream BIG: Personal Development For Smart Trader

"How can you achieve your first million by just age 26?"

"I DARE TO DREAM BIG!" 

Merry Riana - Touching Hearts Changing Lives

Today is a special day.
I won't tell you about technical or fundamental analysis right now. I just want to tell you a story.

A story about Merry Riana.


I follow her on twitter yesterday, after reading about her on one of my tweeps.
Soon, I found out that she is a best-selling author, millionaire entrepreneur and dynamic motivational speaker.

And it is amazing on how she managed to follow back all her followers, and reply to their tweets. I know, because she did so to me ^^. Thank you Merry.

Her most known achievement is that she earned more than SGD 1,000,000 at 26 through her business. Just 4 years after her graduation from Nanyang Technological University.

"Yes, I know Nanyang is a very cool university. No wonder she succeed. Her parent must be very rich. She only need to continue what her parent already started" is my first thought of her. Oh, so little of me.

After I read her book, Dare to Dream BIG! I feel embarrassed on my foolish judgement. She is as successful as now, because she endured the pain and sacrifice. Now, let the story begins.

Initially, it was never on her family's plan to sent her overseas to study, because it was too costly. However, the year 1998 the asia financial crisis hit Indonesia, hard! Singapore seemed to be the best choice: it is nearby, safe environment, and good education system.

Merry Riana and Family

WHAT CAN YOU DO WITH $10?

Think you can answer that? Now, the question is "what you can do with $10 for a week?"
Her $10 story is one of the most touching on her book.

Imagine what a college girl, with shy personality, in a completely new world and still traumatic with what happen in his hometown can do with only $10 a week?

That is how she endured her first year studying in Nanyang Technology University.

I won't tell you the detail here. Let her alone telling you vividly how it is like. It will change something inside of you if you read it in her book.



SICK AND TIRED OF BEING SICK AND TIRED


In her 2nd year in NTU was where she felt so fed up about her life. At that moment, she thought seriously about her life and decided to change her life.

It happened when she celebrated her 20th birthday.

"It is in your moments of decision that your destiny is shaped." - Anthony Robbins

She made a resolution, that before she celebrate her 30th birthday she must achieved her financial freedom. Most importantly, she wanted to pay off her student loans as soon as possible and give a good life for her parent.

And the rest is history. Well, her story.

No, she didn't achieved it by turning $1,000 into $1,000,000 in 4 years trading online.

Actually, she had the chance to lost most of her saving by trading stocks. It was painful. Maybe she should try forex trading.

But, reading her book gives you an insight on becoming a better forex trader, or maybe athlete, photographer, salesperson or even a doctor.

She shared her favorite poem.

Our deepest fear is not that we are inadequate.  Our deepest fear is that we are powerful beyond measure.  It is our light, not our darkness, that most frightens us.  We ask ourselves, who am I to be brilliant, gorgeous, talented, and fabulous?  Actually, who are you not to be?  You are a child of God. Your playing small doesn't serve the world.  There's nothing enlightened about shrinking so that other people won't feel insecure around you.  We are all meant to shine, as children do.  We are born to make manifest the glory of God that is within us.  It's not just in some of us, it's in everyone.  And as we let our own light shine, we unconsciously give other people permission to do the same.  As we are liberated from our own fear, our presence automatically liberates others. By: Miriam Williamson

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The Great Default: It Is Coming, Count on It

"All costs are present costs. It is only a question of who pays them and why." -Gary North-

Cookie Jar Economic Model

When you catch a child with his hand in the cookie jar, you can be certain of these few things:

• He is after a present cookie
• He will not replace that cookie
• He is driven by the desire for present gratification

Now, think of U.S national economic production as a cookie factory

Traditional Bolu Cookies Factory

People are employed to produce cookies. They make cookies, but they also eat cookies..

If they made no cookies, could they eat cookies? Only those cookies already in the cookie jar.

If, because of a war, the U.S government tells the public that from now on, "we must support the troops," this means that those at work in the cookie factory must send their cookies to the troops. The troops will eat the cookies. But they will not be producing cookies.

Toy Story Troops

Gary North on The Great Default:

THE BOND MARKET
The U.S Government sold war bonds in World War II. The total by the end of the program in 1946 was $185 billion - in early 1940's dollars - a gigantic amount.

The War Finance Committee and the War Advertising Council spent more money on this ad campaign thanany other in the history of American advertising.

But why did the U.S government sell them?

If the cost of the war in men and material was paid for by those on the battlefield who suffered and died, as well as by the folks back home who had to reduce their consumption, what did the war bond produce of economic value? A war bond could not reduce the loss of human life. It could not reduce the number of burned-out tanks. 

In short, a war bond could not reduce the cost of war.

Then, why sell them?

The reason was motivation. The cookie jar was being depleted, day by day.

This meant that replacements were necessary.
Folks back home who were engaged in war production would have to reduce their consumption. This output had to replace whatever had been lost.

The three crucial question: 

1. Which folks would have to cut back?
2. Which folks wouldn't?
3. For how long?

Anyone who says we are passing the present costs to future generations does not understand economic cause and effect.

We are told that we are using politics to leave massive debt to our children. As soon as this burden grows too heavy, Congress will then sell more debt.

At some point, that debt will not find a market. The Great Default will then take place.

Gary North is the author of a free 20-volume series, An Economic Commentary on Bible

His recent article is United States on the Road to Ruin

"There will be victims. The Great Default will affect millions of people who do not understand that they are at risk or why."

.

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Find the Balance: The Yin and Yang of Forex Trading

Damage is part of the battle, recovery is essential , victory is the objective - Sun Tzu, Art of War

Karate Chi

Yin Yang. 

Action and reaction. Impulse and Corrective wave. Profits and Losses. Positive and Negative. Duality exist everywhere.

Dian L. Chu, the market analyst and author of EconMatters wrote:

"The theory of quantum mechanics and Einstein's theory of relativity (E=mc2) have taught us that matter (yin) and energy (yang) are inter-related and interdependent.

This interconnectness of all things is the essense of the concept "yin-yang", and Einstein's fundamental equation: matter equals energy." 

Supernova: Knight, Princess and A Shooting Star

I started to learn about the quantum mechanics when I read about Supernova: Ksatria, Putri dan Bintang Jatuh by Indonesian author Dee.

It is a great novel on quantum psychic. It described: Mandelbrot, fractals, chaos theory and messiah concept in a spectacular way.

Since then, I am interested to learn more about the Bill M. Williams chaos theory trading methodology.
Bill's indicator consist of: Alligator, Fractals and Awesome oscillator and the basis of the methodology is the chaos theory.

However, whatever your trading method is always remember this important concepts:

• Find the order in chaotic market with Market Rhythm
• Stop trading when you hit the certain loss in a row. Take a rest. Re-balance yourself.
• Accept that a loss is the part of the game.

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3 Things To Wait: Trader's Guide to Maximize Profits

"To wait is excruciating for some. For trader, waiting is gold."

Desktop Clock

One of the main distinction between successful trader and mere human are their ability and willingness to develop their patience and persistence.

The true test to our persistent is when we are asked to wait. Remember the feeling?

Now there are three things you need to wait, when you are in front of your screen trying to make a pip or two.

The Market Hour

One of the thing you need to wait when trading foreign exchange is the market hour. Market hour depends on the pair you trade. Every pair represents a nation or a union, such as Euro representing European Union.

And every market or nation has its own 'rush hour'. The hours when the market is moving fast, real fast. 

The tool I use to mark the Market Hour (session) is Forex Market Hours software.

Forex Market Hours

           

CONFIRMATION


After waiting for the right session for the right currency pair, then it is time to set up the chart with our hand picked technical indicators. 


Waiting for confirmation depends on your own choice of method. Be it breakout or reversal trading method, you need to wait for the price action to be confirmed. How many times do you jump into a trade, without a single analysis, just because you see the price moves wild?


Wait For EXIT


Another difficult task of trading is to decide when to exit, and actually executing that decision. This still related with your trading system and money management method.


The way to help you find exit is to plan your exit before you enter the trade. It is like setting the path to emergency exit. You don't want to get trapped in fire do you? So, plan your trade and trade your plan.

Armor Games

Remember, Keep Trading Simple!

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