How To Trade

26 Sam Seiden Webinars

Below are links to 26 Sam Seiden Webinars (updated 9 April 2011) which provide hours of clear and concise tutoring on how to trade supply and demand zones. These freely available webinars are produced and hosted by FXstreet.com, owner of those videos, who kindly let me publish the list here.

1. Trading and Analysis (added April 2011)
2. Rule Based Market Timing (added April 2011)
3. Trading The All Star Entry (added April 2011)
4. Breakout Trading in Forex
5. Supply and Demand Strategy Application
6. Identifying High Probability Turning Points
7. Forex Swing Trading With Supply and Demand Analysis
8. Currency trading with Forex Futures
9. Supply, Demand and Bollinger Bands
10. Live Trading and Analysis
11. Identifying Swing Trading Opportunities in the Forex Market
12. An Important Rule To Consider When Scanning For Trading Opportunities In Forex
13. Rule based trading for short and longer term Forex traders
14. Multiple Time Frame Analysis
15. Low Risk Breakout Trading in Forex
16. Rule Based Short Term Trading In Forex
17. Trade What Is Real, Not What You Feel: Quantifying Supply and Demand in The Forex Markets
18. Conventional Chart Patterns and Forex
19. Short term Forex Trading Strategies, Breakouts and Reversals
20. MONTHLY WEBINAR: Understanding The Creation Of Candles In Forex Trading
21. Capture reversal points with the use of indicators and oscillators
22. Forex Swing Trading, Low Risk / High Reward Trading
23. Understanding The Exact Process Behind The Movement In Price
24. Using CCI and Stochastics For Long and Short Term Forex Trading
25. Multiple Low Risk Forex Entries With Support and Resistance
26. Supply and Demand Trading with Mechanical Indicators and Oscillators in the Forex Markets

01: NON FARM PAYROLL (Part 1)- ECONOMIC REPORTS FOR ALL MARKETS

This is the 1st video in a series on economic reports created for all markets, or for those who simply have an interest in economics. In this and the next lesson, we cover the Employment Situation Report, also known as Non Farm Payroll.

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Non-farm Payrolls (metatrader5.com)

Non-farm Payrolls is the assessment of the total number of employees recorded in payrolls.

This is a very strong indicator that shows the change in employment in the country. The growth of this indicator characterizes the increase in employment and leads to the growth of the dollar. It is considered an indicator tending to move the market. There is a rule of thumb that an increase in its value by 200,000 per month equates to an increase in GDP by 3.0%.

• Release Frequency: monthly.
• Release Schedule: 08:30 EST, the first Friday of the month.
• Source: Bureau of Labor Statistics, U.S. Department of Labor.

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FF forum economic calendar :

1. Source : Bureau of Labor Statistics
2. Measures : Change in the number of employed people during the previous month, excluding the farming industry
3. Usual Effect : Actual > Forecast = Good for currency
4. Frequency : Released monthly, usually on the first Friday after the month ends
5. Why Traders Care : Job creation is an important leading indicator of consumer spending, which accounts for a majority of overall economic activity
6. Also Called : Non-Farm Payrolls, NFP, Employment Change

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mql5 forum thread : Non-Farm Employment Strategy

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AUDUSD M5 with 45 pips in profit (by equity) for NFP :

EURUSD M5 : 87 pips price movement by NFP news event :

NZDUSD M5 : 37 pips price movement by USD - Non-Farm Employment Change :

Trading EURUSD during NFP :

USDCAD M5 with NFP :

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02: NON FARM PAYROLL (Part 2)- ECONOMIC REPORTS FOR ALL MARKETS

This is the 2nd video in a series on economic reports created for all markets, or for those who simply have an interest in economics. In this and the next lessons, we cover the Employment Situation Report, also known as Non Farm Payroll.

03: TWO MORE UNEMPLOYMENT REPORTS

This is the 3nd video in a series on economic reports created for all markets, or for those who simply have an interest in economics. In this lesson we cover the ADP Unemployment Report and the Weekly Claims for Unemployment Insurance Report.

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Jobless Claims (metatrader5.com)

There are two types of Jobless Claims - Initial Claims, when a person applies for a benefit for the first time in five years, and the total number. Initial claims are more important. Both figures show weekly changes in the number of jobless claims.

These figures do not always reflect the real state of events. They are sometimes distorted by short-term factors, such as federal or local holidays. This indicator can give an idea of what Non-farm payrolls will be next time. For example, if during a month the value of Jobless Claims consistently decreases, then it is likely that the value of Non-farm payrolls will be large. It has a limited impact on the market. Reducing of the number of jobless claims is a favorable factor for the growth of the dollar.

• Release Frequency: weekly.
• Release Schedule: 08:30 EST, every Thursday.
• Source: U.S. Department of Labor.

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FF forum economic calendar :

• Source : Department of Labor
• Measures : The number of individuals who filed for unemployment insurance for the first time during the past week
• Usual Effect : Actual < Forecast = Good for currency
• Frequency : Released weekly, 5 days after the week ends
• Why Traders Care : Although it's generally viewed as a lagging indicator, the number of unemployed people is an important signal of overall economic health because consumer spending is highly correlated with labor-market conditions. Unemployment is also a major consideration for those steering the country's monetary policy
• Also Called : Initial Claims, Unemployment Claims

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EURUSD M5 : 14 pips price movement by USD - Unemployment Claims :

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EURUSD M5 : 24 pips price movement by USD - Unemployment Claims :

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USDJPY M5 : 34 pips price movement by USD - Unemployment Claims :

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USDCHF M5 : price movement by USD - Unemployment Claims :

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04: PRODUCER PRICE INDEX

This is the 4th video in a series on economic reports created for all markets, or for those who simply have an interest in economics. In this lesson we cover the Producer Price Index

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Talking Points

• PPI stands for the Producer Price Index.
• PPI comes out the second week of each month.
• Forex traders can use PPI as a leading indicator to forecast consumer inflation measured by the Consumer Price Index (CPI)

In the 1950’s gasoline was $0.27, apartment rent was $42/month and a movie ticket was $0.48. In addition, the US dollar was worth 9 times what is worth now. Inflation reduces domestic buying power and that is why central banks fight so hard to beat back inflation by raising the interest rate. Forex traders are well aware that interest rates are the main driver of currency movement. Investors seek higher yields and will migrate capital from low yielding assets and currencies to high yielding assets and currencies. This is why traders pay special attention to the Producer Price Index because it alerts them to the rise and fall of inflation which could, in turn, lead to a rise and fall of currency rates.

What is PPI?

Released monthly in the second week of each month, the Producer Price Index (PPI) is an indicator used to measure the average change in selling price, over time, received for finished goods.Retailers that have to pay more for finished goods may have to pass on higher costs to consumers. This measurement of price change from the view of the seller can be a leading indicator for consumer inflation that is measured by the Consumer Price Index (CPI). PPI examines three production areas; commodity-based, industrial-based, and stage-of-processing-based companies. Released by the Bureau of Labor Statistics, PPI is created using data collected from a mailed survey of retailers selected randomly.

Traders can see changes in PPI expressed in a percentage change from the previous year or month to month.

Why Look at PPI?

Forex traders use the Producer Price Index to find the direction of prices and a measurement of inflation. Rising prices in the form of inflation lowers the purchasing power of a country’s currency because consumers can buy less goods and services for each unit of currency. This decrease in consumer buying power usually triggers a central bank response to raise interest rates. A rising PPI could indicate that consumer prices could rise leading to higher interest rates. The increase in interest rates stimulates the demand for that currency as investors chase yield. This inflow of capital results in a higher exchange rate. On the other hand, a stable or falling PPI insures that interest rates will remain low. This results in a lower relative currency exchange rate. As you can see, using the information found in PPI can give traders an advantage when seeking out strong and weak currencies.

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05: ISM MANUFACTURING

This is the 5th video in a series on economic reports created for all markets, or for those who simply have an interest in economics. In this lesson we cover the ISM Manufacturing report.

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ISM Index (Institute of Supply Management's index, former NAPM — National Association of Purchasing Managers) is the index of business activity.
ISM figures above 50 are usually considered as an indicator of expansion, while values below 50 indicate contraction. Typically, when ISM approaches 60 investors begin to worry about possible economic overheating, inflation increase and the corresponding measures (raising rates) by the Federal Reserve Bank. Figures below 40 entail talks about recession.
ISM is released just before unemployment data are announced, and is often used to refine data by Bureau of Labor Statistics.

• Release Frequency: monthly.
• Release Schedule: 10:00 EST, the first business day of the month.
• Source: Institute for Supply Management.

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• Source : Institute for Supply Management
• Measures : Level of a diffusion index based on surveyed purchasing managers in the manufacturing industry
• Usual Effect : actual > forecast = good for currency
• Frequency : Released monthly, on the first business day after the month ends
• Why Traders Care : It's a leading indicator of economic health - businesses react quickly to market conditions, and their purchasing managers hold perhaps the most current and relevant insight into the company's view of the economy
• Also Called : Manufacturing ISM Report On Business

How Forex News Traders Use ISM Numbers (adapted from dailyfx article)

• The Institute for Supply Management (ISM) was founded in 1915 and is the first supply management institute in the world.
• Servicing 40,000 business professionals in more than 90 countries, ISM focuses on supply chain management.
• Forex traders rely heavily on ISM’s release their Purchasing Managers Index (PMI) on the first business day of each month to gauge economic growth.

NZDUSD M5 : 17 pips prrice movement by USD ISM Manufacturing PMI :



What is ISM?

A country’s economy is as strong as its supply chain. The Institute for Supply Management (ISM) measures the economic activity from both the manufacturing side as well as the service side. Formed in 1915, ISM is the first management institute in the world with over 40,000 members in 90 countries. Since it can draw from information gathered from the surveying its large membership of purchasing managers, the ISM economic news releases are carefully watched by Forex traders around the world as a reliable guide to economic activity.


ISM Surveys

ISM publishes three surveys; manufacturing, construction, and services. Published on the first business day of the month, the ISM Purchasing Managers Index (PMI) is compiled from surveys of 400 manufacturing purchasing managers. These purchasing managers from different sectors represent five different fields; inventories and employment, speed of supplier deliveries, production level, and new orders from customers.

XAUUSD M5 : 3345 pips price movement by USD - ISM Non-Manufacturing PMI news event :



In addition, ISM construction PMI is released on the second business day of the month, followed by services on the third business day. Forex traders will look to these releases to determine the risks at any given time in the market.

EURUSD M5 : 37 pips price movement by USD - ISM Non-Manufacturing PMI news event :



Forex Market Impact

The Manufacturing and Non-manufacturing PMI’s are big market movers. When these reports come out at 10:30 AM ET, currencies can become very volatile. Since these economic releases are based on the previous month’s historical data gathered directly from industry professionals, Forex traders can determine if the US economy is expanding or contracting.

Forex traders will compare the previous month’s number with the forecasted number that economists have published. If the released PMI number is better than the previous number and higher than the forecasted number, the US dollar tends to rally. This is where fundamental and technical analysis comes together to create a trade setup.

AUDUSD M5 : 21 pips price movement by USD - ISM Non-Manufacturing PMI news event :



In the example above, notice how the better than expected PMI number triggered a US dollar rally against the Euro. As seen in the chart above of the EURUSD, the ISM Non-Manufacturing was not only above 50 but at 55.4, beat the forecasts calling for a drop from 54.4 to 54.0.

When an economic release beats expectations, like in the example above, sharp fast moves can result. In this case, EURUSD dropped 22 pips in 15 minutes. Traders often choose the Euro as the “anti-dollar” to take advantage of capital flows between two of the largest economies.

The Euro zone has a large liquid capital markets which can absorb the huge waves of capital seeking refuge from the U.S. So a weak US ISM Non-Manufacturing number usually leads to a dollar sell-off and a rise in the Euro. Another scenario is when the number released is in line with forecasts and/or unchanged from the previous month, then the US dollar may not react at all to the number.

AUDUSD M5 : 32 pips price movement by USD - ISM Manufacturing PMI :



Overall, an ISM PMI number above 50 indicates that the economy is expanding and is healthy. However, a number below 50 indicates that the economy is weak and contracting. This number is so important that if the PMI is below 50 for two consecutive months, an economy is considered in recession.

PMI’s are also compiled for Euro zone countries by the Markit Group while US regional and national PMIs are compiled by ISM. As you can see, traders have good reason to pay special attention to the important releases from the Institute of Supply Management.

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06: DURABLE GOODS

This is the 6th video in a series on economic reports created for all markets, or for those who simply have an interest in economics. In this lesson we cover the Durable Goods report.

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Durable Goods Orders (DGO) is an indicator of orders placed for relatively long lasting goods. Durable goods are expected to last more than three years, e.g.: cars, furniture, appliances, etc.

This indicator is important for the market because it gives an idea of the consumers' confidence in the current economic situation. Since durable goods are expensive, the increase in the number of orders for them shows the willingness of consumers to spend their money on them. Thus, the growth of this indicator is a positive factor for economic development and leads to growth of the national currency.

• Release Frequency: monthly.
• Release Schedule: 08:30 EST, the fourth week.
• Source: U.S. Census Bureau of the Department of Commerce.

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USDJPY M5 : 47 pips price movement by USD - Durable Goods Orders news event :



EURUSD M5 : 32 pips price movement by USD - Durable Goods Orders news event :

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07: CONSUMER PRICE INDEX

The CPI measures the changes in retail prices for goods and services. In the US, it is considered the number one indicator for inflation, and it is one of the main economic reports the Fed uses when determining when to change interest rates.

The consumer price index measures a weighted basket of about 200 commonly purchased goods and services. Each month, the BLS determines the retail prices for these items and compares them to the prices from the previous month to gauge the change in the average cost of living. The data is then grouped into 2 separate indexes.

CPI (W) category is for for wage earners, and clerical workers.

The CPI (U) is for all Urban workers.

The data most economists pay attention to, the main statistics reported in the media, and the information used in this video come from the CPI(U) report.

CPI (W) report for wage earners category, covers about 1/3 of the working population, and is used for things like cost of living adjustments in social security payments.

For each category, an index number is provided that is an ongoing, continuous percent of change in prices from an original start date. For the main categories, this date is 1982 to 1984. In other words, every month they compare prices to what the average prices were in 1982 to 1984, and then add to, or subtract from, the total percentage of change since then.

So again, they add up the prices in the basket of goods, compare it to the prices from 1982 to 1984, generate an index number, and then compare it to the previous index number.

They take the difference between these two numbers, and then divide it by the previous month index number.

The CPI report is issued monthly about 3 weeks after the month being reported.

The report contains one main table, A, and several follow up tables. There are also several short summaries of the data for table A that contain the most important statistics.

The two main statistics reported in the media are the seasonally adjusted percent change for the total index from the previous month, and the non-seasonally adjusted 12 month percent change of the total index.

The first is the one month total change in prices for goods and services throughout the country, adjusted for seasonal factors such as weather conditions. This is the seasonally adjusted inflation rate for one month.

The second is the total change in prices for goods and services for an entire year. This change is not adjusted for seasonal factors, so it more accurately reflects the total change of prices consumers pay. In other words, this is the total inflation rate for a whole year.

In addition, perhaps equally important, is the seasonally adjusted rate of change for all items less food and energy. In this section, items relating to food and energy are removed. Because of the volatility of prices of items in these two categories, some economists feel that by removing these items, one gets a more accurate view of inflation. This category is often referred to as Core CPI.

As I mentioned before, there are several follow up tables at the end of the report. The first table is the change of prices for the entire basket of goods broken down into detail which shows the change of price for individual sections, sectors and commodities.

The 2nd table is the same thing, only the prices and index numbers have been seasonally adjusted.

The third table is the change of prices broken down by different areas.

On table worth mentioning is table 7- the chained consumer price index. This report attempts to take into account substitutions consumers make when prices change in the regular CPI basket of goods ...

08: CONSUMER CONFIDENCE INDEX

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CCI

This index is an attempt to measure consumer optimism. It is calculated since 1967. Its base value is 100. The index is calculated based on the monthly survey of 5,000 families for a number of questions:

• family's financial situation as compared to the previous period;
• The expected financial situation of the family during the year;
• assessment of business conditions in the economy during the year;
• estimate of the expected unemployment and economic recession;
• assessment of home shopping (clothes, furniture, etc.);

The index has a moderate impact on the market because it can fail to reflect the real state of the economy. However, it is traditionally used for predicting trends in employment and the general state of the economy. Growth of the index is a good factor for the national economy and leads to the growth of the dollar.

• Release Frequency: monthly.
• Release Schedule: 10:00 EST, after the 20th of each month.
• Source: the NY-based Conference Board.

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09: INDEX OF CONSUMER SENTIMENT

This is the 9th video in a series on economic reports created for all markets, or for those who simply have an interest in economics. In this lesson we cover The University of Michigan's Index of Consumer Sentiment.

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University of Michigan Consumer Confidence Index

University of Michigan Consumer Confidence Index is the survey of consumers' confidence in the current economic situation. The survey is conducted by the University of Michigan USA. It analyzes the desire of consumers to spend their money. The index is a leading indicator of consumer sentiment.

It has a limited impact on the market. Growth of the index leads to the growth of the dollar.

• Release Frequency: twice a month.
• Release Schedule: 10:00 EST, the second week of the month (preliminary) and in two weeks (final).
• Source: University of Michigan.