Press review - page 501

[Sergey Golubev]

AUD/USD - bounced from .7749 resistance for correction (based on the article)

Daily price is located above Ichimoku cloud in the bulliosh area of the chart. The price was bounced from resistance level at 0.7749 to below for the secondary correction to be started. If the price breaks 0.7490 support level so we may see the bearish reversal, otherwise - ranging within the levels waiting for the strong trend to be started.

• "The Australian Dollarput in a Bearish Engulfing candlestick pattern, hinting prices may have topped below 0.78 figure against the US Dollar once again. A reversal lower would mark the second time that prices failed to overcome resistance dating back to in August 2016. "
• "Near-term support is at 0.7659, the 14.6% Fibonacci expansion, with a break below that on a daily closing basis opening the door for a test of the 23.6% level at 0.7604. Alternatively, a push above double top resistance at 0.7760 paves the way for a test of the April 2016 high at 0.7835."
• "Prices are too close to near-term support to justify entering a short trade from a risk/reward perspective. Either a bounce or a confirmed breach of near-term support is needed to pave the way for an actionable entry opportunity. In the meantime, opting for the sidelines seems most prudent."

[Sergey Golubev]

EUR/USD: intra-day ranging for the bullish to be resumed or for the correction to be started (based on the article)

H4 price is located above Senkou Span line which is the virtual border between the primary bearish and the primary bullish trend on the chart. The price is on ranging within 1.0824/1.0769 support/resistance levels since 21st of march this year waiting for the bullish trend to be resumed or for the secondary correction to be started.

• "The 240 minute EUR/USD Forex chart has been rallying for 4 weeks. Yet, the rally over the past 6 days has had many reversals and bear bars. It therefore is probably the start of a trading range."
• "While the daily EUR/USD chart has been rallying up from a higher low major trend reversal for 4 weeks, it has not yet strongly broken above the neck line. In addition, the rally is a wedge top on the 240 minute chart. Furthermore, it has been especially weak over the past 6 days. These 6 days look like a bull leg in a trading range. Hence, the EUR/USD chart will probably pull back to test the most recent higher low, which was Tuesday’s low."

[Sergey Golubev]

Understanding Forex Risk Management

Betting Strategies
"There are three basic ways to take a bet: Martingale, anti-Martingale or speculative. Speculation comes from the Latin word "speculari," meaning to spy out or look forward."

Know the Odds
"So, the first rule in risk management is to calculate the odds of your trade being successful. To do that, you need to grasp both fundamental and technical analysis. You will need to understand the dynamics of the market in which you are trading, and also know where the likely psychological price trigger points are, which a price chart can help you decide."

Liquidity
"The next risk factor to study is liquidity. Liquidity means that there are a sufficient number of buyers and sellers at current prices to easily and efficiently take your trade. In the case of the forex markets, liquidity, at least in the major currencies, is never a problem. This liquidity is known as market liquidity, and in the spot cash forex market, it accounts for some $2 trillion per day in trading volume."

Risk per Trade
"Another aspect of risk is determined by how much trading capital you have available. Risk per trade should always be a small percentage of your total capital. A good starting percentage could be 2% of your available trading capital. So, for example, if you have $5000 in your account, the maximum loss allowable should be no more than 2%. With these parameters your maximum loss would be $100 per trade. A 2% loss per trade would mean you can be wrong 50 times in a row before you wipe out your account. This is an unlikely scenario if you have a proper system for stacking the odds in your favor."

Leverage
"The next big risk magnifier is leverage. Leverage is the use of the bank's or broker's money rather than the strict use of your own. The spot forex market is a very leveraged market, in that you could put down a deposit of just $1,000 to actually trade $100,000. This is a 100:1 leverage factor. A one pip loss in a 100:1 leveraged situation is equal to $10. So if you had 10 mini lots in the trade, and you lost 50 pips, your loss would be $500, not $50."

[Sergey Golubev]

Risk Management Techniques For Active Traders

Planning Your Trades
"As Chinese military general Sun Tzu's famously said: "Every battle is won before it is fought." The phrase implies that planning and strategy - not the battles - win wars. Similarly, successful traders commonly quote the phrase: "Plan the trade and trade the plan." Just like in war, planning ahead can often mean the difference between success and failure."

Stop-Loss and Take-Profit Points
"A stop-loss point is the price at which a trader will sell a stock and take a loss on the trade. Often this happens when a trade does not pan out the way a trader hoped. The points are designed to prevent the "it will come back" mentality and limit losses before they escalate. For example, if a stock breaks below a key support level, traders often sell as soon as possible."

How to Effectively Set Stop-Loss Points
"Setting stop-loss and take-profit points is often done using technical analysis, but fundamental analysis can also play a key role in timing. For example, if a trader is holding a stock ahead of earnings as excitement builds, he or she may want to sell before the news hits the market if expectations have become too high, regardless of whether the take-profit price was hit."

Calculating Expected Return
"Setting stop-loss and take-profit points is also necessary to calculate expected return. The importance of this calculation cannot be overstated, as it forces traders to think through their trades and rationalize them. As well, it gives them a systematic way to compare various trades and select only the most profitable ones."

[ (Probability of Gain) x (Take Profit % Gain) ] + [ (Probability of Loss) x (Stop Loss % Loss) ]

[Sergey Golubev]

MQL5 WIZARD: HOW TO CREATE A RISK AND MONEY MANAGEMENT MODULE

MetaTrader 5 provides a powerful tool that allows you to quickly check various trading ideas. This is generation of Expert Advisors using the MQL5 Wizard on the basis of ready trading strategies. An Expert Advisor created with the MQL5 Wizard, is based on four pillars - four base classes:
...

[Sergey Golubev]

USD/JPY Daily- waiting for the direction of the bearish trend to be resumed or the secondary rally to be started (based on the article)

Daily price broke Ichimoku cloud to below to be reversed to the primary bearish market condition located below Ichimoku cloud. For now, the price is on narrow ranging within 110.62/111.58 s/r levels waiting for the direction of the bearish trend to be resumed or the secondary rally to be started.

"Japanese Money markets via, the 3-month JPY LIBOR have risen more aggressively after the Dovish-Hike than USD LIBOR. The decreasing premium has aligned with JPY strength against the USD. While the BoJ is not expected to give the Fed a run for the mosthawkish central bank, a decreasing premium could continue to boost JPY against USD should the trend continue."
"The focus should now be on signs of continuation that a breakdown from Bear Channel support may open up a move toward 110/108 on JPY strength, which aligns with the 50, & 61.8% retracement of the post-election price range. Despite the bearish tone, a trade above 114.48 would show an overlapping price structure that would negate a near-term Bearish view. Until then, we’ll keep an eye for a price break of channel support given the larger environment that may support pending JPY strength and USD weakness."

[Sergey Golubev]

Intra-Day Fundamentals - EUR/USD, Gold (XAU/USD) and USD/CNH: U.S. Durable Goods Orders

2017-03-24 12:30 GMT | [USD - Durable Goods Orders]

• past data is 2.0%
• forecast data is 1.1%
• actual data is 1.7% according to the latest press release

if actual > forecast (or previous one) = good for currency (for USD in our case)

[USD - Durable Goods Orders] = Change in the total value of new purchase orders placed with manufacturers for durable goods.

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From abcnews article:

• "The Commerce Department said Friday that orders for durable goods rose 1.7 percent in February and an upwardly revised 2.3 percent in January. Orders so far this year are running 1.6 percent higher than in the first two months of 2016."
• "The growth indicates that manufacturers are steadily recovering from a rough patch that began in 2015 when lower energy prices and slowereconomic growth worldwide cut into demand for U.S. factory goods. The report contained some weakness in a few sectors such as motor vehicles, but it is among several indicators that point to an ongoing rebound."

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EUR/USD M5: range price movement by U.S. Durable Goods Orders news events

XAU/USD M5: range price movement by U.S. Durable Goods Orders news events

USD/CNH M5: range price movement by U.S. Durable Goods Orders news events

[Sergey Golubev]

Weekly Outlook: 2017, March 26 - April 02 (based on the article)

German Ifo Business Climate, US CB Consumer Confidence, Stephen Poloz speech US Crude Oil Inventories, Unemployment claims, GDP data from the US and Canada are the main events on forex calendar.

1. German Ifo Business Climate: Monday, 8:00. German business confidence is expected to rise further to 111.2 in March.
2. US CB Consumer Confidence: Tuesday, 14:00. Consumer confidence is estimated to reach 113.9 this time.
3. Stephen Poloz speaks: Tuesday, 15:10. Bank of Canada Governor Stephen Poloz will speak in Oshawa.
4. US Crude Oil Inventories: Wednesday, 14:30.
5. US GDP data: Thursday, 12:30. The Federal Reserve projects a growth rate of around 2% in the next few years.
6. US Unemployment Claims: Thursday, 12:30. Economists expected an increase of 240,000 claims.
7. Canadian GDP: Friday, 12:30.

[Sergey Golubev]

Weekly EUR/USD Outlook: 2017, March 26 - April 02 (based on the article)

EUR/USD had a mixed week. The last week of March features a key survey and fresh inflation figures. Is the ECB’s optimism justified? 

1. German Ifo Business Climate: Monday, 8:00.
2. Monetary data: Monday, 8:00.
3. German CPI: Thursday, the German states publish their estimates during the morning and the all-German number is made public at 12:00.
4. German Import Prices: Thursday, 6:00.
5. Spanish Flash CPI: Thursday, 7:00.
6. German Retail Sales: Friday, 6:00.
7. French CPI: Friday, 6:45.
8. French Consumer Spending: Friday, 6:45.
9. German Unemployment Change: Friday, 7:55.
10. Flash inflation data: Friday, 9:00. In February, the consumer price index hit the “holy grail” of central banking at 2%, higher than expected. However, core CPI remained stuck at 0.9%. The Producer Price Index rose by 0.7% m/m in January.

[Sergey Golubev]

Weekly Fundamental Forecast for Dollar Index (based on the article)

Dollar Index - "On the data front, the third revision of fourth-quarter GDP figures is expected to show a narrow upgrade while the Fed’s favored PCE inflation gauge is expected to leave core price growth at 1.7 percent in February, unchanged from the prior month. Absent dramatic surprises to the upside, such outcomes are unlikely to generate a strong response from price action."