Have you heard the saying that trends are your friend. Well there is a
lot of truth to that saying, let me share 5 attributes to why this
statement is true for all traders.
What is Price Action?
"A common beginner question to trading is what exactly is Price Action? Well, good question, let me sum it up for you."
Forum on trading, automated trading systems and testing trading strategies
Something Interesting to Read February 2014
newdigital, 2014.02.04 15:21
Trading Price Action Reversals : Al Brooks
detailed guide to profiting from trend reversals using the technical analysis of price action
The key to being a successful trader is finding a system that works and
sticking with it. Author Al Brooks has done just that. By simplifying
his trading system and trading only 5-minute price charts he's found a
way to capture profits regardless of market direction or economic
climate. His first book, Reading Price Charts Bar by Bar, offered an
informative examination of his system, but it didn't allow him to get
into the real nuts and bolts of the approach. Now, with this new series
of books, Brooks takes you step by step through the entire process.
By breaking down his trading system into its simplest pieces:
institutional piggybacking or trend trading, trading ranges, and
transitions or reversals (the focus of this book), this three book
series offers access to Brooks' successful methodology. Trading Price
Action Reversals reveals the various types of reversals found in today's
markets and then takes the time to discuss the specific characteristics
of these reversals, so that you can use them in your everyday trading
endeavors. While price action analysis works on all time frames, there
are different techniques that you can use in trading intraday, daily,
weekly and monthly charts. This, among many other issues, is also
addressed throughout these pages.
Other books in the series include Trading Price Action Trends and Trading Price Action Trading Ranges
If you're looking to make the most of your time in today's markets the
trading insights found in Trading Price Action Reversals will help you
achieve this goal.
newdigital, 2014.02.10 16:20
Trading Price Action Trading Ranges : Al Brooks
Divided into five comprehensive parts, Trading Price Action Trading
Ranges skillfully addresses how to spot and profit from trading
ranges—which most markets are in, most of the time—using the technical
analysis of price action. Along the way, it touches on some of the most
essential aspects of this approach, including:
And much more
Throughout the book, Brooks focuses primarily on 5 minute candle
charts—all of which are created with TradeStation—to illustrate basic
principles, but also discusses daily and weekly charts. And since he
trades more than just E-mini S&P 500 futures, Brooks also details
how price action can be used as the basis for trading stocks, forex,
Treasury Note futures, and options. For your convenience, a companion
website, which can be found atwiley.com/go/tradingtrends, contains all
of the charts provided in the book.
Check the other book from this series : Trading Price Action Reversals : Al Brooks
Price Action and Ichimoku Trading - Price Action Courses
Tenkan Sen / Kijun Sen Cross
The Tenkan Sen / Kijun Sen Cross signal occurs when the Tenkan Sen (Turning line) crosses the Kijun Sen (Standard line).
A bullish signal occurs when the Tenkan Sen crosses from below to above the Kijun Sen
Indicators: Ichimoku Cloud
newdigital, 2013.11.25 12:23
Ichimoku Cloud (based on The Definitive Guide to Trading Trends with Ichimoku Cloud article)
Many traders are asked what indicator they would
wish to never do without. The answer has never wavered as there is one
indicator that clearly illustrates the current trend, helps you time
entries, displays support and resistance, clarifies momentum, and shows
you when a trend has likely reversed. That indicator is Ichimoku Kinko
Hyo or more casually known as Ichimoku.
Ichimoku is a technical or chart indicator that is
also a trend trading system in and of itself. The creator of the
indicator, Goichi Hosada, introduced Ichimoku as a “one glance”
indicator so that in a few seconds you are able to determine whether a
tradable trend is present or if you should wait for a better set-up on a
Before we break
down the components of the indicator in a clear and relatable manner,
there are a few helpful things to understand. Ichimoku can be used in
both rising and falling markets and can be used in all time frames for
any liquid trading instrument. The only time to not use Ichimoku is when
no clear trend is present.
Always Start With the Cloud
The cloud is
composed of two dynamic lines that are meant to serve multiple
functions. However, the primary purpose of the cloud is to help you
identify the trend of current price in relation to past price action.
Given that protecting your capital is the main battle every trader must
face, the cloud helps you to place stops and recognize when you should
be bullish or bearish. Many traders will focus on candlesticks or price
action analysis around the cloud to see if a decisive reversal or
continuation pattern is taking shape.
In the simplest
terms, traders who utilize Ichimoku should look for buying entries when
price is above the cloud. When price is below the cloud, traders should
be looking for temporary corrections higher to enter a sell order in the
direction of the trend. The cloud is the cornerstone of all Ichimoku analysis and as such it is the most vital aspect to the indicator.
Time Entries with the Trigger & Base Line
Once you have
built a bias of whether to look for buy or sell signals with the cloud,
you can then turn to the two unique moving averages provided by
Ichimoku. The fast moving average is a 9 period moving average and the
slow moving average is a 26 period moving average by default. What is
unique about these moving averages is that unlike their western
counterparts, the calculation is built on mid-prices as opposed to
closing prices. I often refer to the fast moving average as the trigger
line and the slow moving average as the base line.
components are introduced in a specific order because that is how you
should analyze or trade the market. Once you’ve confirmed the trend by
recognizing price as being below or above the cloud, you can move to the
moving averages. If price is above the cloud and the trigger crosses
above the base line you have the makings of a buy signal. If price is
below the cloud and the trigger crosses below the base line you have the
makings of a sell signal.
Confirm Entries with the Mysterious Lagging Line
In addition to the mystery of the cloud, the lagging
line often confuses traders. This shouldn’t be the case as it’s a very
simple line that is the close of the current candle pushed back 26
periods. When studying Ichimoku, I found that this line was considered
by most traditional Japanese traders who utilize mainly Ichimoku as one
of the most important components of the indicator.
Once price has broken above or below the cloud and
the trigger line is crossing the base line with the trend, you can look
to the lagging line as confirmation. The lagging line can best confirm
the trade by breaking either above the cloud in a new uptrend or below
the cloud in a developing downtrend. Looking above, you can see that the
trend often gathers steam nicely after the lagging line breaks through
the cloud. Another benefit of using the lagging line as a confirmation
indicator is that the lagging line can build patience and discipline in your trading
because you won’t be chasing the initial thrust but rather waiting for
the correction to play out before entering in the direction of the
Trading With Ichimoku Checklist
Now that you know the components of Ichimoku here is
a checklist that you can print off or use to keep the main components
of this dynamic trend following system:
1.Where is Price in Relation to the Cloud?
2. Is price consistently on one side of the cloud or is price whipping around on both sides consistently?
3. Which level of the Ichimoku would like to use to place your stop?
How the Stock Market Works
A variety of integration gateways to liquidity providers and stock
exchanges have recently been developed for MetaTrader 5 trading
platform. Using these solutions, brokers now can greatly improve their
business and enter new markets. We have decided to summarize the first
integration results and make a list of already working MetaTrader 5
Liquidity Providers (ECNs)
ECNs (Electronic Communication Networks) provide liquidity when using
MetaTrader 5. We have developed gateways to the most well-known
providers, and any MetaTrader 5 broker can now make use of their
Something Interesting to Read December 2013
newdigital, 2013.12.18 06:49
The Warren Buffett Way by Robert Hagstrom
This book sheds insight into the ways and means of the Oracle of Omaha.
Warren Buffett's thoughts are insightful and his methods may yield
fruitful rewards for investors with enough patience to learn them,
understand them and apply them correctly.
newdigital, 2014.03.07 09:08
Who Can Trade a Scalping Strategy? (based on dailyfx article)
The term scalping elicits different preconceived connotations to
different traders. Despite what you may already think, scalping can be a
viable short term trading methodology for anyone. So today we will look
at what exactly is scalping, and who can be successful with a scalping
What is a Scalper?
So you’re interested in scalping? A Forex scalper is considered anyone
that takes one or more positions throughout a trading day. Normally
these positions are based around short term market fluctuations as price
gathers momentum during a particular trading session. Scalpers look to
enter the market, and preferably exit positions prior to the market
Normally scalpers employ technical trading strategies utilizing short
term support and resistance levels for entries. While normally
fundamentals don’t factor into a scalpers trading plan, it is important
to keep an eye on the economic calendar to see when news may increase
the market’s volatility.
High Frequency Trading
There is a strong misconception that all scalpers are high frequency
traders. So how many trades a day does it take to be considered a
scalper? Even though high frequency traders ARE scalpers, in order for
you to qualify as a scalper you only need to take 1 position a day! That
is one of the benefits of scalping. You can trade as much or as little
as you like within a giving trading period.
This also falls in line with one of the benefits of the Forex market.
Due to the 24Hr trading structure of Forex, you can scalp the market at
your convenience. Take advantage of the quiet Asia trading session, or
the volatile New York – London overlap. Trade as much or as little as
you like. As a scalper the choice is ultimately yours to make!
There are always risks associated with trading. Whether you are a short
term, long term, or any kind of trader in between any time you open a
position you should work on managing your risk. This is especially true
for scalpers. If the market moves against you suddenly due to news or
another factor, you need to have a plan of action for limiting your
There are other misconceptions that scalpers are very aggressive traders
prone to large losses. One way to help combat this is to make scalping a
mechanical process. This means that all of your decisions regarding
entries, exits, trade size, leverage and other factors should be written
down and finalized before approaching the charts. Most scalpers look to
risk 1% or even less of their account balance on any one position
Who can Scalp?
So this brings us to the final question. Who can be a scalper? The
answer is anyone with the dedication to develop a trading strategy and
the time to implement that strategy on any given trading day.
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Alpari UK broker initial deposit is 1,000
RoboForex broker initial deposit is 1,000
PriceChannel Parabolic system
newdigital, 2013.03.22 14:04
PriceChannel Parabolic system
PriceChannel Parabolic system basic edition
Latest version of the system with latest EAs to download
How to trade
The settingas for EAs: optimization and backtesting
Indicators: Moving Average of Oscillator (OsMA)
newdigital, 2014.03.21 07:04
Scalping with MACD (based on dailyfx article)
When a scalper begins their day, there are usually quite a few questions that need to be answered before ever placing a trade.
What’s moving the market this morning?
Which markets are most active?
What drivers (or news) might come out to push the market further?
Is my coffee ready yet?
These are just a few examples… but suffice it to say that those who are
day-trading in markets have quite a bit on their mind every single
trading day.The Setup
Before a scalper ever triggers a position they need to first find the appropriate market environment.
For fundamental-based traders, Multiple Time Frame Analysis can be
helpful; but more important is their outlook or opinion and the fact
that that outlook or opinion should mesh with the ‘bigger picture’ view
of what’s going on at the moment.
For scalpers, the hourly and 4-hour charts carry special importance, as
those are the ideal timeframes for seeing the bigger picture.
After that, traders should look to diagnose the trend (or lack thereof).
A great indicator for investigating trend strength is the Average
Directional Index (ADX). Also popular for investigating trends is the
Moving Average Indicator.
After the day-trader has found a promising setup, they then need to
decide how to trigger into positions, and MACD can be a very relevant
option for such situations.
Because the trader already knows the direction they want to trade in,
they merely need to wait for a corresponding signal via MACD to initiate
When MACD crosses up and over the signal line, the trader can look to go long.
After a long position is triggered, the trader can look to close the
position when MACD moves down and under the signal line (which is
usually looked at as a sell signal, but because you did the ‘bigger
picture analysis’ with the longer-term chart, this is merely a ‘close
the long signal.’)
Scalpers can trigger positions when MACD Signal takes place in direction of their bias
On the other side of this equation: If the trader had determined the
trend to be down on the longer-term chart or if their fundamental bias
is pointing lower, they can look for MACD to cross down and under the
signal line to trigger their short position.
And once MACD crosses up and over the signal line, the trader can look to cover their short position.
Scalpers can close positions when opposing MACD Signal takes place
The aforementioned approach can work phenomenally in a
day-trading/scalping approach. But the fact-of-the-matter is that
scalping profitably entails a lot more than just a trading plan, and an
Risk management is the undoing of most new traders; and day-traders and
scalpers fall victim to this susceptibility even more so than most.
Something Interesting in Financial Video June 2013
newdigital, 2013.06.11 06:55
Scalping the forex market
All the ins and outs on scalping the Forex market. May Chris dives into the world of Scalping where he
explains in great detail how this style of trading can be accomplished in
the Forex market. This live webinar not only clarifies how a trader can
scalp but also provides every Forex trader with a great guidance and
Something Interesting in Financial Video August 2013
newdigital, 2013.08.26 08:40
A lesson on how the central banks of the world participate in the
foreign exchange market and move the forex market up and down for their
newdigital, 2014.03.21 12:13
The Forex Guide to Fundamentals: Central Banks (based on dailyfx article)
Fundamental traders keep a watchful eye on Central Banks and the policy
decisions they make. These intuitions, through changes in monetary
policy, not only can affect an underlying economy but by de facto
currency rates as well. Today we will continue our look at market
fundamentals by examining Central Banks and how their policy decisions
can affect Forex prices.
Central Banks are institutions used by nations around the globe to
assist in managing their country or region with the commercial banking
industry, interest rates, and currency prices. Examples of active
central banks include the Federal Reserve of the United States, European
Central Bank (ECB), Bank of England (BOE), Bank of Canada, and the
Reserve Bank of Australia (RBA). The sphere of influence of a central
bank may range from a single country such as the Reserve Bank of
Australia or, represent policy created for a region or group of
countries such as the ECB. Because of this, the actions of Central Banks
have the ability to move markets and should be on every fundamental
Central Banking Rates
Normally, a Central Bank will use the monetary tools at their disposal
to meet their designated goals. Monetary policy describes the actions
taken by a central bank to control the money supply inside of its
designated region. Depending on the state of the economy, the fed may
select to either take an expansionary or contractionary policy, with the
supply of money being influenced by two specific methods.
During times of crisis or economic slowdown, central banks will normally
look to expand their monetary policy. They can do this by expanding
asset purchases which increases the monetary base and by also decreasing
interest rates. The theory behind monetary expansionary is to make
money available to banks and businesses in an attempt to increase growth
and development. As a byproduct of an expansionary policy, fundamental
indicators such as GDP are expected to grow and unemployment decline.
As the economy heats up, the Fed will consider taking on contractionary
measures. At this point, the monetary base may begin to be restricted
and interest rates can begin to increase. These actions make excess
investment capital scares, and place a higher premium on lending. With
less capital circulating, the economy is expected to contract and slow
down. During a time of contraction, GDP is expected to decline and
unemployment to contrarily increase.
Conversely, when central banks loosen monetary policy, this can cause a
depreciation of their currency. Lower interest rates can cause lending
to increase at lower prices. As well expanding central bank balance
sheets can create an excess supply of a currency. With a new larger
supply of a currency and with demand being low this can cause prices to
Policy decisions and economic releases from Central Banks will occur
sporadically throughout the month. The best way to track upcoming news
is through the use of a good economic calendar. As these decisions are
made, it is also important to track the movements of the market!
newdigital, 2013.08.26 15:50
3. Individual speculators who actively trade currencies trying to profit
from the fluctuation of one currency against another. This is as we
discussed in our last lesson a relatively new phenomenon but most likely
the reason why you are watching this video and therefore a growing one.