ETF Webinar

Wow! I just finished watching the ETF webinar I told you about the other day from my friend who used to manage trades over 50 million. And, I’ve got to say, that in all my years in the trading business, this is the most content rich webinar I have ever seen. No hype, only hard core trading truths that not everyone is going to like.

ETF Webinar

What shocked me most is when he PROVED his system works on anything that produces a chart, including forex! Just his advanced position sizing tip alone can double the returns of ANY forex system. Some of the other content was the fact that he and his hedge fund buddies used to hunt stops.

Now he’s teaching “civilians” how to make money off their tactics. If you are new to trading, this hour could save you thousands of dollars over the school of hard knocks. Those who don’t get information like this risk having their whole investment account being wiped out, before they’ve really had a chance to trade. Don’t miss out - Click here to register for this free ETF and Money Management Webinar that you can access right now

ETF Webinar

For trading veterans I can guarantee you that the advanced position sizing tip is a golden nugget you’ll use for increasing profits and decreasing risks in the years to come. This one tip could double your profits regardless of what your entry system is. The one tip alone can turn any average system into a winning system. In the webinar he covers:

- How to maximize your winners while risking only 1-2% per trade.

- Why most traders have it backwards when it comes to risk.

- How to eliminate 95% of trading stress and emotion.

- Why most traders have it backwards when it comes to winning percentages.

- One of his four proprietary profit target strategies.
He’ll just give you this valuable tip for listening in Wednesday.

- How to avoid being vague with your entries and stops, like those “gurus”
who say,"Buy a few cents, ticks, or pips above ___."

- A little known, no cost, scanner tool that can help you improve your trades, now.

- A complementary excel sheet that does ALL the math for you.You’ll be able to
easily see the optimal position size and risk vs. reward ratio on all your trades.

- Even how to become a professional money manager and
raise millions, if you so desire.

That last one really surprised me. Because I know that if you really want to make millions in trading the fastest way is to use leverage with other peoples’ money, when you are ready. One of my friend’s former students John Vasquez now trades over $8 million. He also runs the day trading room. Wouldn’t you agree that if you wanted to learn how to trade big money it would be smart to learn from people who have or are currently doing it?

ETF Webinar

There are so many reasons to attend this free webinar that I honestly believe you’re missing the boat if you don’t take advantage of this opportunity. I guarantee it won’t be a waste of your time. I love sharing high quality content with my readers and this is going to be one of the best. Over 900 people attended the live webinar on Wednesday night and 99.6% said that they learned something new that they could use immediately.

ETF Webinar

Our host has worked trades as large as $50 million during his money management career. He will share a little of his story, but most of the hour will be spent teaching you how to improve your trading.Only the next 21 people get their second live day trading mentorship regularly sold for $1,997. On Sunday night at midnight EST he will no longer be accepting new students for his one year mentorship class for a good portion of the rest of the year. Click here to register for the ETF and Advanced Money Management Seminar:

ETF Webinar

Good Trading,
Jason Fielder

Elliott Waves

Traders talk of Elliott Waves. So what are Elliott waves? R.N Elliott is famous for discovering the Elliott Wave Principle. This is what R.N. Elliott said, “Practically all developments which result from (human) social-economic processes follow a law that causes them to repeat themselves in similar and constantly recurring serials of waves or impulses of definite number and pattern.”

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R.N Elliott discerned various types of wave patterns and labeled them. Elliott wave analysis tries to separate the price action into a number of waves that give valuable information about the duration of the trend. R.N Elliott discovered that there are basically two types of wave patterns. 1) Impulse waves. An impulse wave consists of five smaller waves. Impulse waves are waves that move in the same direction of the main trend of the market.

So what is an impulse wave? An impulse wave is a wave that moves in the direction of the market trend and subdivides into 5 smaller waves. Waves, 1, 3 and 5 move in the direction of the market main trend. Waves 2 and 4 move against the market main trend! They are called corrective waves.

Elliott Waves International Free Newsletter

2) Corrective waves. The second type of waves is known as corrective waves. Corrective waves consist of two smaller waves. Waves that move counter to the direction of the market trend are known as the corrective waves. Waves therefore can be analyzed in times periods ranging from a matter of minutes to days to months and years.

Elliott Waves International Free Newsletter

So what are these waves 1,2,3,4 and 5? Wave 3 is usually the longest and the strongest wave. In wave 1, the currency pair makes its initial upward move. In wave 2 the currency pair is considered overvalued.

Many traders fail to count the waves when doing Elliott wave analysis. The most difficult part of Elliott wave analysis is correctly labeling and counting the waves. Elliott discovered that each wave whether impulse or corrective subdivides into smaller waves or is part of a larger wave.

You should have by now understood that wave counting is quite subjective. It usually results in as many forecasts as there are Elliott wave forecasters. An incorrect wave count however, will give a wrong forecast. A correct counting of the waves can help the analyst to achieve amazing accuracy in forecasting the market.

Is Elliott wave analysis useful? There are many traders who believe in the Elliott wave principle while there are others who don’t. Some people say that Elliott wave analysis is useful only in hindsight meaning it is not useful in predicting the future course of the market. However, majority of people who have used Elliott wave analysis strongly disagree with this proposition.

Elliott Waves International Free Newsletter

As a trader you should understand what does Elliott wave principle means because you will come across this term in lot of places even if you don’t want to believe in this principle. An understanding of Elliott waves still have value because it brings to the investor a strong historical perspective even if you are not interested in Elliot wave analysis as a trading technique for short term profits.

The law of markets and the law of gravitation are almost similar. Anything that goes up must come down. The same thing applies in the markets. Markets that go up eventually do come down. Markets never go in one direction. The sheer power of the Elliott wave analysis as a forecasting tool creates a great deal of confusion and worry about the market.

Elliott Waves International Free Newsletter

Some people strongly believe in market timing. There are people who say that market timing is the trading method of the 21st century. It is up to you to make a decision whether market timing should be of consideration when you make your own investment decisions. The followers of the Elliott Wave analysis believe that market timing is of critical importance in investment decisions.

Elliott Waves International Free Newsletter

Range Trading

Range trading is one way to trade the currency market when there is no trending movement in the market. There are times that might last for prolonged periods when the markets are not in any major trend and are only moving sideways swinging between two extremes. But first let’s define what these terms mean. So what is a range? Generally a range is a type of price action bounded on the top by a resistance level and on the bottom by a support level. Some would characterize the price action during a range as sideways or horizontal. Ranges are periods when the markets move up and down without any clear directional trend.

So when the market is in a range, the price action is swinging between two almost horizontal lines. Range trading simply involves identifying and profiting upon the turns within the horizontal trading range. It is between these support and resistance levels that the range trading opportunities lies.

In trend trading, once you have identified a trend forming in the market, you try to enter it as early as possible and ride it as long as it lasts to maximize your pips. Range traders do not let their profits run the way the trend traders do. These turns are also considered swings so the techniques of range trading are often an important component of swing trading strategies.

Since a range is usually bound by two extremes, traders especially those that trade trends consider range trading to be much lower profitability method. The primary reason is that the upside in range trading is necessarily capped at the other side of the range. So when you do range trading, you have to be clear that the profit potential in range trading is limited unlike trend trading.

For example, a 20 pip range that forms on the GBP/USD pair during the Asian Session is not really worth range trading. To tell you the truth most of the time, the market is in a consolidation mode or ranging mode. It is only moving sideways. If you are a trader who makes a living from trading than what to do during such times when the market is not trending and only ranging. Of course learn range trading. Range traders can overcome the dilemma of lower profitability and increase their potential upside by setting a minimum threshold in terms of the height of the ranges they are willing to trade.

20 pips potential profit is not sufficient to justify the risk of range trading in simple terms. The height of this range is too small to make it worthwhile as a range trading opportunity. But this may be the best time for scalping. 3-5 pips gain per trade can be easily made in such a range. However, a 300 pip range can definitely offer an abundance of good potential range trading opportunities.

A profit target on the other side of the range would offer a higher probability trade from a risk/reward perspective if the stop losses are always placed just beyond the support or resistance level from which a range is bounded. Therefore a prudent range trading criterion should include some minimum height of the range.

So the important characteristics of a range is being bounded by two horizontal lines on upside as well as the downside. Once the height of the range is established by at least two approximate touches of both the support and the resistance preparation for range trading should begin. Most range traders will use the common horizontal lines on their charts as the support and resistance for the range.

Bollinger bands are used to measure the volatility in the market. The more volatile the market the more apart the two bands will be. Bollinger bands can be very helpful in trading ranges that do not have strictly defined upper and lower bounds. You can use the dynamic bands like the Bollinger bands to outline these levels.

There is always a simple moving average (SMA) that runs through the center of the two Bollinger bands. You should be careful with the slope of the simple moving average (SMA) running through the middle of the band to ensure that it is flat or near flat when using the Bollinger bands to define a range. Only then you can be confident that a horizontal range is indeed in place.

Range trading involves identifying the points when the price action turns and reverses direction between the two horizontal lines. Go short at the resistance level when the buying pressure loses momentum. Go long at the support level when the selling pressure is overcome by the buying pressure. You can simply use common oscillators like the Stochastics or RSI (Relative Strength Indicator) to help identify potential turns at or near support or resistance when you have established a range.

You must have heard the terminology of the stochastic indicator being overbought or oversold. The Stochastic indicator measures the position of the currency pair compared with its most recent trading range. A Stochastic indicator identifies swing, tops and bottoms.

The closing price tends to be closer to the extreme highs of the currency pair as the currency pair price rises. So what does a stochastic indicator does? Specifically a stochastic indicator measures the closing price of the currency price and it’s high or low during a specific number of days or weeks.

The stochastic indicator is considered to be a highly accurate method of picking the tops and bottoms. The Stochastic indicator points our overbought or oversold conditions. Similarly, the closing price tends to fall on average closer and closer to the extreme lows when the price falls.

Now let’s discuss briefly what does the Relative Strength Indicator does? The Relative Strength Indicator (RSI) is designed to indicate the market’s current strength or weakness depending on where the price closes during a given period. The RSI is plotted on a 0-100 scale.

You should know this fact that the buy and sell signal levels will vary depending on the length you choose for the RSI calculation. Try different lengths to figure out what works best. However, a buy signal is usually generated when the RSI moves up through the lower band usually at 30. Similarly a sell signal is usually generated when the RSI moves down through the upper band usually at 70.

Practice with the RSI on your demo account for sometime to become familiar with its use. Most prices seem to change direction at 30 and 70. However, note that this is not a hard and fast rule. A shorter length time frame will result in the RSI being more volatile. A longer length time frame results in a less volatile RSI.

So range trading involves using indicators to generate the buy and sell signals. How do you know when to buy and when to sell in range trading? The most common method of reading these oscillators is to identify the point at which they cross the line exiting overbought or oversold which signals a possible turn in the direction of price action.

It is always good to seek confirmation of a trading signal by using another indicator. Another turn confirmation can be found at the break of an intra range trendline beside oscillators. It is still a valuable confirmation that the turn in the range has indeed occurred although using a trendline break confirmation can result into a late trade entry.

So most of the time the currency market is not trending! Range trading can be an effective method of trading when the forex market is not trending. A tighter stop loss can then be placed on the other side of the trendline break as opposed to the other side of the range support or resistance.

The best is riding the trend as long as it lasts. But as said, most of the time there will be no clear trend in the currency market. The traders can take benefit of the range trading methods during the time the forex market is bouncing back and forth between horizontal resistance and support. Range trading the bounces can be an effective trading method under these non trending market conditions if the established range has sufficient height.

USD to Go Volatile on U.S. Homes Sales and Bernanke Speech

The U.S. Dollar is expected to go volatile today on U.S. Homes Sales data and the speech by Federal Reserve Chairman Ben Bernanke at 14:00 GMT. Bernanke is expected to discuss the economic crisis and recovery. With regards to the home sales data, the figure is expected to rise to 5.03 million, up from the previous figure of 4.89 million. Forex traders should follow both of these events closely as they are set to determine the USD's main crosses for Friday's trading.



USD - Positive Economic Data Weighs in on Dollar

The Dollar declined versus most major counterparts throughout much of yesterday's trading on Thursday as U.S. equity markets rallied amid better-than-forecast data. Weighing further on the USD, the Philadelphia Fed reported that manufacturing in the region unexpectedly expanded this month for the first time in almost a year, a sign the U.S. economy is recovering. Furthermore, the Conference Board said the index of leading economic indicators rose 0.6% in July, its fourth consecutive monthly gain. The Dollar index traded at 78.331, down slightly from 78.485.

The Dollar may continue its decline today as the release of today's economic data may show sales of U.S. existing homes gained 2.1% last month, the highest since September 2008. An improvement in the U.S. housing market will further support risk appetite since the housing market crash was at the root of the current crisis.

Along with the Existing Home Sales report that will be released today at 14:00 GMT, traders should also follow Ben Bernanke's testimony, set to begin at 14:00 GMT as well, as it tends to cause great market volatility and may intensify the current bearish sentiment on the Dollar.

EUR - EUR Extends Gains as Equities Continue to Rebound

The EUR extended its gains against the British Pound ahead of a report today that is forecasted to show Europe's manufacturing and service industries contracted at a slower pace this month, adding to signs that the global recession is coming to an end.

The EUR traded at $1.4250 early this morning, from $1.4254 yesterday, and at 133.99 Yen from 134.26 Yen. Encouraging risk appetite further were recoveries in global equity markets, boosting demand for higher yielding currencies and commodities at the expense of the USD and JPY.

The French, German and Euro-Zone Manufacturing and Service data is expected to be released at 7:00 GMT, 7:30 GMT and 8:00 GMT respectively. With the recent recoveries in German and French GDPs, this data should provide an insight as to the sustainability of this recovery, and therefore have a major affect on the direction of the European currency.

JPY - Yen Boosted By a Drop in Asian Stocks

The JPY appreciated against the Dollar and Euro in today's early trading as Asian stocks dropped, boosting demand for Japan's currency as a refuge. The Yen typically strengthens in times of financial turmoil as Japan's trade surplus makes the currency attractive.

Japan's currency rose against all 16 major counterparts as Japan's Nikkei 225 Stock Average fell 0.7% and the MSCI Asia Pacific Index of regional shares lost 0.2%. The Yen traded to 93.59 per Dollar from 94.36 in New York yesterday. Japan's currency traded at 133.16 per EUR, up from 134.22. With no major news expected from Japan, movements in global equities will continue to dominate Yen sentiment for today.

Crude Oil - Crude Prices Fall Despite Global Optimism

Crude Oil finished trading at $72.14 a barrel yesterday, down $1.64, as investors felt that the commodity was overvalued. Therefore, they dropped the commodity, and put their money into even riskier assets. Traders dropped Crude for equities, as better than expected manufacturing data added to evidence the recession may be ending. Crude Oil prices also dropped yesterday, as investors realized it was overvalued, as prices soared over the previous 2 days.

In light of the continuous low demand, Oil prices have used equities to estimate the economy's progress and recovery. While Wednesday's equities rally was driven by the surprisingly low inventories, it does not appear to be the beginning of a trend, as only a sustained increase in demand can permanently bring down the inventory level, and there is still no sign for that. Therefore, if equities rise again today and the dollar weakens significantly, we may see Crude Oil prices rebound.

Article Source - USD to Go Volatile on U.S. Homes Sales and Bernanke Speech