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July’s $10,000 Monthly Challenge Winners
FXCM and DailyFX are happy to announce the winners of Julys $10,000 Monthly Challenge! July’s $10,000 contest wrapped up with K.I. from Kapolei Hawaii taking first prize with an astounding 865% return. Second place was awarded to D.L, from California, produced a monthly return of 431% Rounding out our monthly winners, third place was S.G, (348%). B.B. in fourth. (341%) and finally K.V. came in 5th with a 334% return. Congratulations to all of last month’s challenge winners!
July’s trading contest was an exciting event, with our ultimate winner beating out tens of thousands of competitors with a decisive finish. As well, we had a close race for third place, with just 14% points separating our 3rd and 5th place finishers. So what exactly happened in the month of July? To help get a better insight into last month’s contest, I was able to interview our 2nd place winner D.L.
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First off, D.L. is a part time trader who enjoys his full time job as a retail sales trader. He has been trading now for 10 years, and now strictly focuses on the Forex market. He enjoys trading Forex because it allows him to taking advantage of the 24 Hour market conditions. D.L mentioned that he likes to places his traders early in the morning and then monitor his trades throughout the day using the FXCM mobile app!
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EUR/USD Rebounds From Weekly Lows
The EUR/USD is beginning to pair losses after closing lower for 3 consecutive sessions and declining as much as 219 pips for the week. The current daily low for the EUR/SUD resides at 1.0985, but technical traders will continue to monitor the psychological 1.1000 level going into tomorrow’s University of Michigan’s Confidence figures and Janet Yellen’s speech at the Boston Fed conference. Both of these events are marked as high importance events, with both having the ability to shift the direction of the EUR/USD.
Attachment 23775
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Gold Price Tests Critical Support Ahead of Election Results
Gold prices continue to fall this afternoon, ahead of today’s U.S presidential election. From yesterday’s high of $1,304.20, the metal has now declined as much as $31.16 over the fits two trading sessions of the week. This move should be seen as significant as Gold prices had previously advanced for 6 consecutive trading days. With this abrupt change in direction, traders should continue to monitor the price of Gold as election results poor in and present event risk for the metal.
Attachment 24320
Technically, Gold is currently trading near an important long term value of support. This point is denoted in the graph below as 200 day SMA (simple moving average) and is found at a price of $1,278.62. This point is interesting graphically, as a move below this point may suggest a turn in Gold’s 2016 trend. So far for the 2016 trading year gold has advanced as much as $313.33, hover this trend has been slowly waning with prices declining over the last 4 months.
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Mathematical Expectation in Trading
Some forex traders use the same trading strategy for all currencies, while others use entirely different strategies depending on the currency pairs being traded. Or, traders may use multiple strategies with multiple forex pairs, in order to perhaps increase profits while reducing the risk of drawdown resulting from over-concentration on a single strategy.
Expert advisors (EA) make it possible to optimize the input parameters, yet they don’t necessarily make it easier to put separate strategies together into a single system. And, testing may show increased risk from overlapping or correlated drawdowns when disparate forex strategies are merged together.
Using algorithms, a trading system can check currency pairs and perform specific operations according to input parameters. A multicurrency, multi-system EA can be crafted in order to assess all trading strategies side-by-side. This may be helpful in case only a single EA is permitted to access a given account.
It can be challenging to develop a forex trading system that works well across different currency pairs under a variety of conditions. Most of the widely-known systems for multicurrency trading are based on trend-following strategies, such as Donchian-channel breakouts, and are designed to profit from very long-term trends. Yet, a multicurrency strategy must clearly show a winning “edge” over the typical time horizons for forex traders.
For example, in order for a system to work well with both EUR/USD and USD/JPY the signals must have a high likelihood of success in spite of volatility and potential correlation between the two pairs. And, trades must become winners during fairly short time periods. If not, then trading correlated pairs may create a risk of over-concentration and excessive drawdown.
There are many profitable opportunities in trading the four major currency pairs — EUR/USD, GBP/USD, USD/JPY and USD/CHF. I’ve been enjoying good success by using a strategy based on Mathematical Expectation (ME). I use ME to analyze data and spot comprehensive trading opportunities and calculate entry/exit points for trading the four major currency pairs.
Mathematical expectation predicts the likelihood that a forex trade will win
A well-programmed EA can use ME tools to help build systems that work across multiple currency pairs. I’ve helped developed a couple of systems that work in real-time and show long-term profitability through back-testing.
Recently, traders have become more aware of the drawbacks that arise when using data-mining techniques to back-test and fine-tune strategies for forex trading systems. Alternative system-development methods like System Parameter Permutation (SPP) are now available and can help traders avoid the issue of data-mining bias.
If done carefully, SPP or data mining will help build a set of good-quality indicators to generate signals across the four major currency pairs. Then, the expert advisor calculates Mathematical Expectation to see whether the trade is likely to be profitable or not.
Finally, it’s a matter of specifying filters and testing to find precise strategies that consistently result in winning, profitable signals. Entry and exit points are calculated by the mechanical trading system using mathematical expectation adjusted for current volatility.
Read more here...MATHEMATICAL EXPECTATION IN TRADING
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Gold Prices Dip as US Dollar Strengthens
Gold Prices have dipped as the US Dollar gains strength ahead of this morning’s USD ISM Manufacturing data. Expectations for today’s event are set at 56.2, and as a high importance event its release is expected to directly affect US Dollar priced assets including Gold.
Attachment 25826
Technically, gold prices have declined substantially after trading to yearly highs earlier in the week at $1,264.06. Now, prices are trading back below their 10 day EMA (exponential moving average), which is found at $1,244.54. A daily close below this average should be considered as a bearish turn in the market, and traders should note that gold prices have not closed below this line since January 30th of this year. If prices decline further, on continued US Dollar strength, gold traders may begin looking for support near the February 21st low of $1,226.23.
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USD/CAD Rises Ahead of FOMC
The USD/CAD is trading higher this morning as the US Dollar strengthens ahead of tomorrow’s FOMC rate decision. Expectations are set to see key rates to rise to 0.75%, and traders will also be looking to Fed Chair Janet Yellen’s conference to provide further direction for US Dollar based pairs.
Attachment 26014
Technically, the USD/CAD is currently trading below the standing 2017 high at 1.3535. Despite the markets retracement, the pair remains supported in a short term uptrend by its 10 day EMA (exponential moving average), which is found at 1.3438. In the event that tomorrows event is US Dollar bullish, traders will look for the USD/CAD to bounce and trade back towards yearly highs. Alternatively, in the event of a selloff, the pair will first need to breach the 10 day EMA before trading towards new lower lows.
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Support and Resistance in the Forex Market, Part One
Support and resistance is key for setting stops. For the trader that wants to buy, they likely don’t want to sit in the trade as prices are driving down to fresh lows. And on the other side, the trader looking to sell probably doesn’t want to sit in a short position while prices are ripping in their face. Support and resistance can help to eliminate those scenarios, as traders looking to buy can wait for support to show, place a stop on the other side so that they remain in the trade as long as support remains respected.
Psychological Levels
We’re going to start off with one of the more simple support and resistance mechanisms, and that’s ‘psychological levels’. Psychological levels, often also referred to as ‘whole number support and resistance’ are simply rounded prices that may elicit a behavioral change within a market. Think the level of parity on EUR/USD. If EUR/USD was trading below parity, even if by only a single pip, that price would seem significantly cheaper than if it were trading above by a single pip. Most human beings will perceive a price of 1.0001 as significantly more expensive than the 2 pips away from .9999. This isn’t necessarily an automatic reaction, where prices above parity will be promptly sold simply because prices are above 1.0000, but this is the type of relationship that will have a tendency to play out with future price action. As drivers continue to show on both sides of the Euro, the bar will be higher for a continued bullish movement, as this psychological resistance can act as a hindrance to price’s further movement. This is the same reason many retail outlets will employ prices that end in .99; it allows them to capture as much profit as possible without the product ‘seeming’ or ‘appearing’ more expensive.
Are All Whole Numbers Equally Important?
The ‘more rounded’ the level, the more likely it is to elicit support or resistance. But as is normally the case in markets, exceptions are aplenty. In many cases, the level of 1.1000 will be more interesting as a potential support or resistance area than a price of 1.1100 or 1.0900. This can change, and each situation is unique, but if there is ‘confluence’ between a psychological level and another form of support or resistance, whether that comes from a Fibonacci retracement or a pivot point or any other mechanism of identifying levels, then the less-rounded level may elicit more interest from market participants.
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3 Common Mistakes To Avoid When Making A Financial Plan
Successful investors understand the importance of creating a well-thought out long-term financial plan. A pilot would not fly an airplane without having a well-thought out flight plan about how they will execute their next flight and contingencies that may arise.
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Difference Between Dow, Nasdaq, and S&P 500
In the U.S., market participants focus the majority of their attention on three indices – S&P 500, Dow Jones Industrial Average, and Nasdaq 100. These indices are of course highly correlated to one another as they track companies impacted by the same business cycle and other important macroeconomic factors.
Additionally, there is some cross-over in the stocks that are included in the ‘big three’. For example, the technology giant Apple Inc. (AAPL) is a constituent included in all three. However, there are big differences between the Dow and Nasdaq and S&P 500 - such as the number and type of stocks included in each index and how index values are calculated.
How is the Dow Jones, Nasdaq, and S&P 500 Calculated?
The S&P 500, created by Standard & Poor’s in 1962, represents the broadest measure of the U.S. economy among the three major indices. The index value is calculated by weighting each company according to its market capitalization and then a divisor, which is set by S&P, is applied to produce the final value. The simple calculation is as such: sum of the market cap of all stocks included divided by the divisor, or total market cap / divisor.
The Dow Jones Industrial Average, often referred to in short as the ‘Dow’, is the oldest index, dating back to 1896 and is the most globally well known. The Dow represents 30 large cap stocks as determined by the Wall Street Journal. Unlike the S&P 500 and the Nasdaq 100, the weighting for each component in the Dow Jones Industrial Average is ranked by share price, and then a divisor applied to create the final value.
The Nasdaq 100 is the youngest of the three indices having begun trading in 1985. It represents the largest non-financial companies listed on the Nasdaq exchange and is generally regarded as a technology index given the heavy weighting given to tech-based companies. The Nasdaq 100 is based on the market capitalization of its components.
Trading Differences Between Dow Jones, S&P 500 and Nasdaq
Despite the tight correlation between the major U.S. indices, they each have their own ‘personalities’ in how they trade due to the differing make-up for each index and importance of certain companies and groups of companies (sectors). The S&P 500 is the least impacted from day-to-day by any single one stock given it is comprised of so many names. With that said, there are a handful of sectors which have the most importance on the index.
Major Differences between Dow, Nasdaq and S&P 500: Breakdown of weightings
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Forex Strategies
If you want to increase your forex trading, and profitability in the market, then this article will definitely help you. This article is very constructive for discouraged forex traders. This article is very helpful if you want to earn profit in less than half an hour with almost no effort. This will be very helpful for expert as well as new forex traders. I assure you that you will not find such a useful product any where else.
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What Does a Forex Spread Tell Traders?
What is a spread in forex trading?
Every market has a spread and so does forex. A spread is simply defined as the price difference between where a trader may purchase or sell an underlying asset. Traders that are familiar with equities will synonymously call this the Bid: Ask spread.
Below we can see an example of the forex spread being calculated for the EUR/USD. First, we will find the buy price at 1.13398 and then subtract the sell price of 1.3404. What we are left with after this process is a reading of .00006. Traders should remember that the pip value is then identified on the EUR/USD as the 4th digit after the decimal, making the final spread calculated as 0.6 pips.
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How to calculate the forex spread and costs
Before we calculate the cost of a spread, remember that the spread is just the ask price less (minus) the bid price of a currency pair. So, in our example above, 1.13404-1.13398 = 0.00006 or 0.6 pips.
Using the quotes above, we know we can currently buy the EUR/USD at 1.13404 and close the transaction at a sell price of 1.13398. That means as soon as our trade is open, a trader would incur 0.6 pips of spread.
To find the total spread cost, we will now need to multiply this value by pip cost while considering the total amount of lots traded. When trading a 10k EUR/USD lot, you would incur a total cost of 0.00006 (0.6pips) X 10,000 (10k lot) = $0.6. If you were trading a standard lot (100,000 units of currency) your spread cost would be 0.00006pips (0.6pips) X 100,000 (1 standard lot) = $6.
If your account is denominated in another currency, like GBP, you would have to convert it to US Dollars.
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Understanding a high spread and a low spread
It’s important to note that the FX spread can vary over the course of the day, ranging between a ‘high spread’ and a ‘low spread’.
This is because the spread can be influenced by multiple factors like volatility or liquidity. You will notice that some currency pairs, like emerging market currency pairs, have a greater spread than major currency pairs. Your major currency pairs trade in higher volumes compared to emerging market currencies, and higher trade volumes tend to lead to lower spreads under normal conditions.
High spread
A high spread means there is a large difference between the bid and the ask price. Emerging market currency pairs generally have a high spread compared to major currency pairs.
Low spread
A low spread means there is a small difference between the bid and the ask price. It is preferable to trade when spreads are low like during the major forex sessions. A low spread generally indicates that volatility is low and liquidity is high.
Keeping an eye on changes in the spread
News is a notorious time of market uncertainty. Releases on the economic calendar happen sporadically and depending if expectations are met or not, can cause prices to fluctuate rapidly. Just like retail traders, large liquidity providers do not know the outcome of news events prior to their release! Because of this, they look to offset some of their risk by widening spreads.
Spreads can cause margin calls
If you are currently holding a position and the spread widens dramatically, you may be stopped out of your position or receive a margin call. The only way to protect yourself during times of widening spreads is to limit the amount of leverage used in your account. It is also sometimes beneficial to hold onto a trade during times of spread-widening until the spread has narrowed.
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Oil Price Outlook: Bearish Breakdown
The impact from Trump tariffs and deteriorating US China trade relations in addition to several other downside risks to global GDP growth have sent crude oil on a 16.5 percent nosedive over the month of May – and prices could still head lower. Market sentiment, as well as oil demand and prices, threaten to deteriorate further considering the barrage of high-impact economic events and data releases next week which look to provide the latest health check on risk appetite and could further spark cross-asset volatility.
Attachment 35711
Recent crude oil carnage could be curbed, however, if the fundamental backdrop for global growth improves on the back of upbeat data or trade war rhetoric. Strength in the US economy may shine and inspire investor confidence if leading indicators like the ISM manufacturing and services PMI readings surprise to the upside. Although, markets are likely still digesting the looming effect from the US slapping a 5 percent tariff slapped onto all Mexican goods exports with any whiff of downward global GDP growth revisions risking more downside in oil.
According to the latest CFTC Commitment of Traders data, net oil futures positioning shows a reduction in net short positioning as the volume of commercials longs outpaced that of shorts for the last 5 weeks. The bullish bets from commercial hedgers could provide crude oil prices with a bit of buoyancy, but it is noteworthy that non-commercial speculative futures traders have grown increasingly bearish over the last month as prices spiral lower.
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Bollinger Bands® and MACD Strategy
Bollinger Bands® can provide invaluable signals for technical traders, and when combined with the Moving Average Convergence Divergence (MACD) indicator, gives traders insight into both volatility and momentum in the forex market.
Attachment 36846
What is the Bollinger and MACD Combination?
As the title suggests, traders can make use of Bollinger Bands® in conjunction with MACD to support trade set ups. Bollinger Bands® allow traders to view the cyclical nature of volatility while the MACD is an effective trend-following, momentum indicator.
Attachment 36847
Using these two indicators together can assist traders when making higher probability trades as they can gauge the direction and strength of an existing trend, along with volatility. As a result, traders can use the MACD to assess if a trend is picking up in momentum or slowing down and setting up for a possible breakout; while the Bollinger Band® can be used as an entry trigger and subsequent confirmation of a trade.
How to Use Bollinger Bands® and MACD to Trade Forex
Traders can trade with Bollinger Bands® and MACD in a number of different ways but two of the most common ways to trade with these two indicators involve breakouts and trend trading.
The MACD indicator supports the bullish trade as the MACD line has crossed the signal line and continues to move above the signal line, showing strong upward momentum. The Bollinger Band® then confirms the move to the upside as price begins to “walk the band” on increased volatility (expansion of the band).
Stops can be placed below the lower Bollinger Band® or at the low of the descending channel. Targets can be placed at a previous high or significant level of resistance - while maintaining a positive risk to reward ratio. Since there is a possibility that the breakout trade turns into a trend reversal, traders should consider multiple target levels and manually move stops up or utilize a trailing stop.
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USD/MXN - weekly/monthly bullish breakout; daily correction
- After printing a multi-decade high at the start of the week, USD/MXN has slumped.
- Mexican Peso interest rate differential remains attractive against the USD.
Attachment 38881
USD/MXN traded at just under 25.50 on Monday, its highest level in decades before making a sharp reversal and falling for three straight days. The sell-off was driven by news that in the US, the USD2 trillion coronavirus rescue package was finally being approved, weakening the greenback. While the US dollar remains the safe-haven asset of choice, the massive US liquidity interventions of late will eventually drive the US dollar lower, with higher yielding currencies like the Mexican Peso likely to benefit. While both countries have cut interest rates lately, the Fed rate currently sits at 0.00% to 0.25%, while the Mexican interest rate is at 6.5%, a substantial yield pick-up over the greenback.
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USD/MXN Outlook: Downside Pressure Continues
Attachment 39467
This week has brought another round of down-pressure for USD/MXN, which has seen the US Dollar fall 4% against the Mexican Peso, breaking the symmetrical triangle pattern and resting around the 22.90 mark. Broad-based Dollar weakness and risk-on sentiment dominated the first half of the week on the back of a possible drug to fight Covid-19.
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Forex traders need to invest in appropriate research to adopt and execute their specific trading strategies. By studying the market as it should be, you can shed light on market trends, the timing of entry/exit, and the effects of fundamentals. In the forex market, the trader also should know about different pairs and how they work in order to succeed in the market.
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USD/MXN - daily bear market rally
As markets continue to monitor Covid-19 cases, the Mexican Peso is able to contain some of the losses
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Gold 1Q 2021 Forecast
While the 1Q’21 gold price outlook is bullish, there are some caveats – mainly, that gold may not be the best performing metal, precious or otherwise.
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Heiken Sar MACD Strategy
This trading strategy utilized 4 standard indicators that comes with Metatrader 4.
1) Heiken Ashi (default setting, use green for bullish, orangeRed for bearish)
2) Parabolic Sar ( Step : 0.02, Max : 0.6)
3) Moving Average (100 period, Exponential)
4) MACD (default setting)
For buy signal :
Heiken Ashi (green) close above 100 MA, Parabolic Sar changed direction to buy signal. We get the confirmation from MACD where the MACD histogram move above 0 level.
The example chart of EURUSD 1 hr chart illustrate the strategy buy condition :
For sell signal :
Heiken Ashi (red) close below 100 MA, Parabolic Sar changed direction to sell signal. We get the confirmation from MACD where the MACD histogram move below 0 level.
The example chart of USDCAD 1 hr chart illustrate the strategy sell condition :
For this strategy, the exit condition either buy fix pips or close position when the Parabolic Sar change direction. It is depends on individual risk involvement.
I didn't try on other timeframe but lower time frame may work.
This strategy also worth looking to turn into expert advisor.
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US Dollar Forecast
Attachment 44053
The US Retail Sales report may generate a bullish reaction in the Dollar as the update is expected to show a pickup in household spending.
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FedEx shares have cooled off
Attachment 44476
The shares of FedEx Corp (FDX) have cooled off after adding 12.3% in December alone.
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Bristol Myers Squibb Stock Is Likely To Offer Better Returns Over This Life Sciences Company
Attachment 45101
We think that Bristol Myers Squibb stock (NYSE: BMY) currently is a better pick compared to its industry peer Bio-Rad Laboratories stock (NYSE: BIO), a life sciences company, given its better growth prospects and comparatively lower valuation of 3.3x trailing revenues, compared to 5.7x for Bio-Rad..
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Lam Research Stock Has Jumped 3.5x Since 2018
Attachment 45394
Lam Research Corporation (NASDAQ: LRCX) stock price jumped almost 3.5x from $136 in 2018 end to $467 currently, primarily due to favorable changes in its P/S multiple. The weekly price is on bearish erversal by bouncing from 731 resistance level to cross Ichimoku cloud to below to 466 support level. If the price breaks 466 support so the primary strong bearish trend will be continuing, if not so the weekly price will be on secondary ranging to be located below Ichimoku cloud in the bearish area of the chart.
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What To Expect From Electronic Arts?
Attachment 45597
Electronic Arts (NASDAQ: EA) is scheduled to report its fiscal FYQ4 2022 results on Tuesday, May 10.
The weekly price is on bearish breakdown with 114 support level to be crossed on close W1 bar for the strong bearish trend to be continuing.
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Gold (XAU/USD) weekly outlook
Attachment 45711
- Gold prices ended a 4-week losing streak as recession worries multiply
- Markets translated growth fears into a cooler outlook for interest rates
- Hawkish tone from Fed, other top policymakers may reboot the selloff
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Ulta Stock Could Reclaim Year-To-Date Breakeven In H2
Attachment 46054
After staging an impressive post-earnings pop in late May, the shares of Ulta Beauty (ULTA) spent the former half of this month consolidating just below the $430 level before losing some of this steam as June volatility wore on.
The weekly price is ranging near and around Ichimoku cloud for waiting for the direction of the strong price to be moved:
- the price will be bouned to the bullish condition if the price breaks 429 resistance level to above;
- the price will be reversed to the bearish market condition in case the price breaks 330 support level to below.
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Amazon’s stock (NASDAQ: AMZN) has lost roughly 14% YTD, What’s Next?
Attachment 46327
Amazon’s stock (NASDAQ: AMZN) has lost roughly 14% YTD as compared to the 13% drop in the S&P500 index over the same period. The weekly price was bounced from support level at 105 to above for the primary bullish trend to be resumed with resistance level at 143 as the key level for the bullish trend to be continuing.
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British Pound (GBP) Forecast
Attachment 46552
The GBP had a disappointing week against its major counterparts with the Bank of England’s (BoE) underwhelming 50bp hike adding to its woes. Will the coming week bring much needed optimism for the Pound or will the slide to parity continue?
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South Africa Central Bank Raises Key Rates Further
Attachment 46748
South Africa's central bank raised its key interest rates for the seventh straight policy session on Thursday to anchor inflation expectations more firmly around the mid-point of the target band and to increase confidence of attaining the inflation target sustainably over time.
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How to Become a Successful Signal Provider on MQL5.com
Quote:
The objective of a successful signal provider is to discover a robust and profitable strategy that allows them to capture a small portion of that pie daily, broadcasting it to a large number of subscribers simultaneously.
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