My Stat Counter!!!
Monday, September 21, 2009
Sunday, September 20, 2009
Must see this: Trading Basics by Mark McRae
I was thinking about an article I read some time ago that 90% of traders who ever trade lose their account and that 10% actually go bankrupt. If the first number doesn't scare you then the second definitely should.
Why is it then that there is such a large number of traders failing? It is not because they are stupid; in fact most traders have an above average IQ and are above average in most categories such as education and income. So why do they failLack of trading education!
By education I don't just mean learning how RSI works or drawing lines on a chart. I mean thoroughly educating yourself in all aspects of your chosen profession. Educating yourself on the correct psychological approach to the market! Educating yourself in the correct risk management techniques relative to your account size. Educating yourself in the correct entry and exit
methods for the trading style that suits you.
This, my friend, is where I hope to be of some help. I don't have all the answers nor do I profess to be some kind of guru but I will do my best to point you in the right direction.
Common Misconceptions Of New Traders
They think they can trade consistently with an 80% accuracy.
They think they can turn $1000 into $100,000 in six months.
They think they can predict turning points in their given
markets to within minutes.
They think they can buy a system that is 100% accurate.
They think they will quit their jobs and make a living full
time after a few months of trading.
What's the reason that so many new traders believe that trading is an easy way to make big profits? Propaganda!
We are continually bombarded in magazines, emails and the general media with claims of making astronomical amounts, just by applying the vendor's latest method or system.
Don't get me wrong, there is good stuff out there but the vast majority is not worth the price you pay. At www.surefire-trading.com I also recommend products but I have at least read the ebooks or courses and think they have some value to my subscribers and they all have a refund guarantee.
Fundamentals Of Trading
The way you approach the market psychologically has as much to do with your success as any trading plan.
Risk management is crucial if you want to have any hope of becoming a successful trader.
Matching a method of trading with your personality is the only way you will ever feel comfortable in the markets.
An adequately funded account is necessary - not only to be able to take the trades you want, but also so you don't feel every trade is a live or die situation.
The journey to the road of successful trading will make you confront your deepest fears. Your armor on this journey will be confidence, knowledge and belief in yourself that you can achieve your dreams.
Never, equate your success or failure in the markets with who you are as a person!
The Flaw In Our Emotions
As humans we have a natural tendency to try and influence our surroundings and events we take part in. This is one reason we, as a species, have succeeded but it is also one of the fundamental flaws we all have when trying to achieve success as a traders.
As traders we have to realize we have no control over the market and if we accept that then we have to accept that we can not influence the direction of the market.
The problem of course is we have a tendency to try and succeed and when inevitable losses come, it is easy to let those losses effect us emotionally. Becoming euphoric when you hit a winning streak is almost as detrimental as becoming depressed when you have a string of losses.
We as traders have to try and achieve the state of impartiality. We have to accept that we will have losses as readily as we will have wins. Reaching the stage where you can comfortably accept loss in the knowledge that your method of trading will produce profits in the longer term is the state we have to aspire to.
Risk Management
Whenever I think of risk management I always think of an article I read on 925 CTA programs between 1974-1995. It essentially confirmed what I have long held to be true. To summarize the report, of all the CTA's who managed funds, the most consistently profitable were the ones with the best risk management systems.
To trade successfully you have to take a long look at yourself. Ask and answer the following questions.
How much equity do I need to start? How much should I risk on any one trade? Am I undercapitalized?
During the course of these lessons I will do my best to help answer these and other questions.
Entry And Exit
As a trader you will probably fall into two main categories, traders who like to trade the breakout and traders who like to join the trend once established. We could also add congestion traders, reversal type traders and mechanical signal traders but for the vast majority of traders you are going to fall into one of the two categories.
If you are a trend trader, you like to define a trend and then find a way in. This may be with the aid of fibonacci retracement levels, moving averages, Gann or one of the other many indicators available today. Your goal is to enter the trend as early as possible with the least amount of risk.
Breakout traders like to enter the market on the breakout of a previously identified range. This may be support/resistance areas, rectangles, triangles or one of the many other chart patterns. The secret to this type of trading is to determine a valid break.
In future lessons we shall begin to look at the more technical side of trading and how you can apply technical analysis to the markets to increase your probability of success.
Conclusion
During this lesson I have tried to give you a glimpse into the world of trading. I have also taken a slightly negative stance, as I don't want you to get unrealistic expectations of what to expect.
On the more positive side, trading is a fascinating world, which will allow you to really exercise your brain. There is no other arena where you get to play with some of the best minds in the world on a level playing field.
Once mastered, if you can ever use that term then the possibilities are endless. Hopefully I can help you achieve your goals
Good Trading
Best Regards
Mark McRae
Saturday, September 19, 2009
Must SEE
Leonardo Pisano (nickname Fibonacci) was a mathematician, born in 1170, in Pisa (now Italy). His father was Guilielmo, of the Bonacci family. His father was a diplomat, as a result Fibonacci was educated in North Africa, where he learned "accounting" and "mathematics".
Fibonacci also contributed to the science of numbers, and introduced the "Fibonacci sequence"
The Fibonacci sequence is the sequence 1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144, introduced in his work "Liber abaci" in a problem involving the growth of a population of rabbits.
Aside from this sequence of number where every next number is the sum of the proceeding two, 0, 1 (0+1), 2 (1+1), 3 (2+1), 5 (3+2), 8 (5+3), 13 (8+5), etc.
There are the "Fibonacci ratios".. By comparing the relationship between each number, and each alternate number, and even each number to the one four places to the right, we arrive at some fairly consistent ratios.. The important ones are .236, 50, .382, .618, .764, 1.382, 1.618, 2.618, 4.236, and for good measure we include 1.00 ..
It turns out that the ratios are mathematical principles prevalent in nature around us, and is also in man-made objects. There are many interesting, entertaining, and poetic observations about Fibonacci numbers and ratios in the universe (see the reference section below). Fibonacci numbers appear in ancient buildings, in plants, planets, molecules, the dimensions of human bodies, and of course snails… But of what use is all that to the lowly trader?
What really interests you, the application of Fibonacci techniques in the trading environment..
Traders usually study charts! Fibonacci ratios may be applied to the Price scale, and also to the time scale of charts. I study the price scale. My focus here will be on the price scale for now, perhaps in the future I'll add some time-scale studies.
Prices never move in a straight line. Look at any chart, you will see many wiggles, as price advances and retraces.. Stocks, Futures, Forex, all instruments which are liquid, will often retrace in Fibonacci proportions, and advance in Fibonacci proportions. Not always, and not precisely to the penny. But very often, and reasonably close! This happens often enough that profitable trades can result. I will show you some examples below.
I used Fibonacci ratios with a few simple indicators to help determine probable price turning points, optimum entry, exit and stop-loss levels. My complete techniques are available in on-line video seminars, in-person seminars, and via my real-time on-line chat facility. For more details, see the following web page: http://www.surefire-trading.com/fibmaster.html
The application of Fibonacci to trading can be very complex, and take much time and experience to perfect. Many traders enjoy making the process as difficult and as complex as they can tolerate.. I do the opposite, I try to simplify, try to bring clarity.
Fibonacci example - Microsoft Weekly chart.
This lesson demonstrates a very basic way to use Fibonacci levels. You just read about Fibonacci ratios. We will use just one of those ratios for now, the .382 Fibonacci ratio. In this chart MSFT made a high of (approximately) $59.97 in December of 1999. After that, it moved down to make a low of $30.19 in May of 2000.
The down move was $29.78 (59.97-30.19), quite a substantial amount.
Projecting from that low in May, and using a Fibonacci ratio, we can calculate 29.78*.382=$11.37 . So 38.2% of 29.78 is 11.37 . If MSFT were to rally 38.2% of the down-move it would reach $41.57 (11.37+30.20). I'm using rounded numbers in my calculations, the chart above calculates it to be $41.564, we don't need that degree of accuracy!
Several weeks later, MSFT rallied and resisted right near that .382 Fibonacci level !!
So we were able to predict a future probable turning point (after the low of May 2000), using the Fibonacci ratio of .382!! If only it were always so easy.
The steps involved are:
- Calculate the total value of a significant price-move (high to low, or vice-versa).
- Calculate a Fibonacci retracement (in this case .382) of the prior move.
- Look for price to confirm, by resisting (or support in an up-move) near that predicted retracement area.
Fibonacci example - Microsoft Daily chart.
This chart shows how a different Fibonacci level (61.8%) predicted resistance and a market turn.
Notice how the market behaved at the .382 level (30.80 area). Initially the market spiked through, then fell back to that level (late October). We cannot expect a chart to retrace at every Fib level. We can expect some support/resistance as buyers/sellers enter the market at these levels, but we can't always predict whether the market will actually turn at any particular level. Fibonacci techniques are used to alert you to a possible trade, if that price level does cause support or resistance. These techniques are not used as a trigger for entry. Other indicators are used in conjunction with Fibonacci studies to provide higher-probability entries..
As mentioned before, there are several Fib levels, .236, 50, .382, .618, .764, 1.382, 1.618, 2.618, 4.236, and 1.00 .. So there are several places to look for a market turn. They can be calculated in advance, but trading blindly at a fib level can be dangerous, because you never know for certain (in advance) whether the market will turn at any particular Fib level. I use other indicators to help overcome that problem, click here to learn how to determine which Fib ratio is likely to be strong enough to turn the market.
Important notes from this lesson:
- There are several Fib levels.
- It takes some skill to determine which Fib level is likely to cause the market to turn.
- There are some techniques to help you determine where a market is more likely to turn.
- Do not blindly anticipate a market turn at a Fib level.
More Fibonacci examples.
QQQ Weekly chart with a deep retracement to .618 and a weak attempt to rally after that. However, consider the daily chart and intraday traders. they would have enjoyed the rally from $75 to $100, after going long from a support level that could have been predicted in March!
QQQ daily chart. Multiple Fib levels timing the market perfectly in 3 consecutive waves up!
Intraday chart, QQQ 30-minute. Notice the two market Fib retracements (there are others in this chart too).. The rally from 29.26 stopped at 31.10, then it supported **twice** at 30.39, for two good scalps. The next highlighted Fib support is at a retracement of .618 from the move up 30.47 to 32.49 .. Both of these support levels were predictable before the market supported there.. Hint:--- See how the rally continued after the shallow retracement to 30.39 ... See how the rally after the deeper retracement to .618 near 31.25 was a weaker rally.. This is common, a deeper retracement often foretells a weaker rally... See the next lesson in the table of contents for more on these advanced Fibonacci trading principles.
Another intraday chart, S&P 5-minute.. The first Fib retracement is on a bearish move, an opportunity to short. The second is bullish, with a long entry near 999.25 .. Note that popular charting software will calculate Fibonacci to rediculous precision, we don't need anything closer than one tick! Actually, you should allow some room don't expect precision every time. Allow the trade some room to develop, or you will be stopped out too often.
More Advanced - Microsoft Daily chart.
By now you're probably quite interested, perhaps applying all those Fibonacci ratios to many charts.. You should experiment with your own charts. As long as the instrument traded has a lot of liquidity (not a penny stock for example), you should start to see Fib support and resistance at work. You will start to notice that Fibonacci levels "work" sometimes and not others. Sometimes the trades are not profitable, or are less profitable than others. You need to develop the skills required to select better trades.
In this mini-lesson I want to show you how to evaluate price action based on which Fib levels it responds to, and how the market behaves immediately preceding the Fib support/resistance.
The chart below actually has many Fibonacci levels "performing well", providing support or resistance to the market. I want you to focus on the two that I have identified, for the purposes of this lesson.
The first up-move that I have identified topped out at $26.90, and then retraced 61.8% before supporting at that Fib level. There was a pause at the .382 level, but it was not sufficient to hold the market. Now look at the rally from the support level near .618, it rallied but did not exceed the prior high of 26.90 … As a general rule, a retracement to .618 or below indicates that the preceding up-move is losing steam. A shallow retracement which supports at .382 is more likely to rally beyond the prior high than one which has a deep retracement beyond .50 all the way to .618 ..
The impressive thrust from 22.55 up to 26.90 was negated by a quick move back to .618 at about 24.20, so a trader should not be too optimistic about a continuation of the initial up-thrust.
Similarly, the move up in June, from 23.50 to almost 26.50 would also not inspire much optimism for a huge rally above the high of 26.50 … In general a shallow support at .382 would indicate a probable rally beyond the prior high. However, if the up-move preceding the retracement was sluggish rather than thrusting, you also should temper your enthusiasm.
If the second rally which only retraced to .382 had the thrust of the first rally, it would be a more attractive trade!
These are not firm rules, instead they are used as a guide, to help you filter for better trades. Every Fib level is not equal, some are more attractive than others.
Important notes from this lesson:
- Not all Fib levels are alike.
- No technical study is perfect, you must develop the skills to filter out bad trades, and improve the odds of finding better trades.
- Price action just before a Fib retracement can tell you something about the future.
- Which Fib level causes the end of a retracement also can give a hint to future price action.
- No technical study is perfect, you must develop the skills to filter out bad trades, and improve the odds of finding better trades.
You can learn more about Neal and his video course by clicking here.
Good Trading
Best Regards
Neal Hughes
Website - www.fibmarkets.com
Email - members@fibmarkets.com
Found the post from orkut... no offence....
Cotton Ear Buds... (Must read it)
Please do not show sympathy to people selling buds on roadside or at Signals..... .... Just wanted to warn you people not to buy those packs of ear buds you get at the roadside... It's made from cotton that has already been used in hospitals... They take all the dirty, blood and pus filled cotton, wash it, bleach it and use it to make ear buds.
So, unless you want to become the first person in the world to get Herpes Zoster Oticus (a viral infection of the inner, middle, and external ear) of the ear and that too from a cotton bud, DON'T BUY THEM!
Mobile Phone
Don't put your mobile closer to your ears until the recipient answers, Because directly after dialing, the mobile phone would use it's maximum signaling power, which is: 2watts = 33dbi. Please Be Careful.
Please use left ear while using cell (mobile), because if you use the right one it may affect brain directly. This is a true fact from Apollo medical team
Appy Fizz
Do not drink APPY FIZZ. It contains cancer causing agent.
Mentos
Don't eat Mentos before or after drinking Coke or Pepsi coz the person will die immediately as the mixture becomes cyanide. Please fwd to whom u care.
Kurkure
Don’t eat kurkure because it contains high amount of plastic if U don't believe burn kurkure n u can see plastic melting. Please forward to all!!!!!!!!! !! .News report from Times of India .
Tablets
Friday, September 18, 2009
Forex Trading India, A great Trading Decission.
Today the Forex Market makes for one of the best investment decisions an investor or trader can make. With the trillions of dollars daily being exchanged on the Forex market today’s trader has no problems with liquidity issues. Having seen the meltdown of many equities markets in the past 12 months this has also helped see many new Forex Traders emerging. The Forex market almost never sleeps, which means that the trader can get in and out with ease and without fear of a company collapsing.
So here are 4 reasons why you too should be investing in the Forex Market.
1. Almost anyone can start trading in the forex market as the minimal capital requirement with many Best Forex Broker is around $100, despite popular belief that you need large amounts of capital. As long as you follow the correct trading principles you can start making income from your capital.
2. The forex market is massive, there is trillions of dollars being traded every day, so you don’t have to worry about being able to exit a trade, unlike what has happened in recent times with stocks.
3. Larger volatility. Forex is the most volatile market in the world. What this means? The ability to make large profits every single day, as it does move extremely quickly!
4. Ability to make money even in times of a recession. Unlike stocks which are very hard to profit from during recessions, you can profit no matter which way the market goes. As you have the ability to be able to long or short on the Forex Market. While once the stock market melts, it can be difficult to make profits in these markets.
Now you have the reasons to start trading the Forex Market, now what you need to do is educate yourself so that you can benefit from this amazing market. A great place to start to learn more about the Forex Market is with the CFD FX REPORT, they offer a host of educational lessons and can help you find the best Forex Broker in the market to start trading with.
You never know this maybe the article that gets you started on the greatest market in the world.
Effects of a Future Recession on Forex Markets
The US also faced bad news from its manufacturing sector with the manufacturing index falling to its lowest level in six years. Weak demand for US products coupled with consumer uneasiness with current economic conditions, higher food and fuel prices, and the future for the manufacturing does not look good. US consumers saw any wage gains made in the past few years disappear limiting consumer spending. This trend is expected to last until at least the end of the year and could result in more job losses. In the US consumer confidence is at its lowest since 2000.
The current credit crisis is starting to spread from Wall Street to "Main Street" with tightening credit, massive home foreclosures, and evidence that the US is headed into a recession. The global economy is fragile at present and in Europe economic activity seems to be collapsing at a faster rate than in the US. It is hoped that the bailout will reinvigorate worldwide credit markets and interbank lending that had frozen up while financial institutions staggered under the weight of failed mortgages.
Central banks have injected billions of dollars to maintain liquidity and have instituted emergency currency exchange programs. Credit is still frozen awaiting action by the US house on the bailout bill. Interbank lending rates continue to rise and reflect an aversion to risk at this time. Many economists are now stating openly that a global recession is in the works.
Although public opposition to the bailout remains political analysts believe the House is more likely to pass the revised version of the bailout bill. In a statement Treasury Secretary Paulson said, "This sends a positive signal that we stand ready to protect the U.S. economy by making sure that Americans have access to the credit that is needed to create jobs and keep businesses going." Jump starting credit markets is seen as one way to avoid an all out recession. Although the Dollar has been holding its own in Forex markets, long term uncertainty about the future of the US dollar remains. The House vote on Friday is eagerly awaited by Forex investors and traders worldwide. Who knows, it is possible that the bailout will provide Forex opportunities unheard of before the crisis.
FOREX-Dollar rebounds from 1-year low versus euro-friday 18th 2009
Sterling declined across the board, hitting a near five-month low euro on renewed concerns about the UK banking sector.
The dollar has sold off sharply this month as investors shifted into riskier assets on increasing signs the global economy is recovering. The prospect of low U.S. yields and concerns about the U.S. fiscal deficit fueled dollar selling.
But the currency gained a respite on Friday as investors trimmed their positions ahead of holidays in Japan and Singapore next week, although the trend for broad dollar weakness was seen as likely to persist.
"Today overall has been a retracement day and a profit-taking day," said Andrew Busch, a global FX strategist at BMO Capital Markets in Chicago. "(But) I don't see anything on the horizon just yet that would take us out of this sell-the-U.S. dollar mode."
With no U.S. data to lend direction, currencies are taking their cues from equity and commodity markets. World equities .MIWD00000PUS came under pressure after scaling an 11-month peak as investors took stock of recent hefty gains, although Wall Street ended higher in a choppy session.
"I still think that currencies are at the mercy of the stock market," said Fabian Eliasson, vice president of currency sales at Mizuho Corporate Bank in New York.
In late New York trading, the euro EUR= fell 0.3 percent to $1.4701. It hit a one-year high on Thursday and has risen 2.6 percent so far this month.
The dollar index .DXY, which measures the dollar's value against a basket of six major currencies, rose 0.4 percent to 76.500, having bounced off Thursday's one-year low of 76.010.
STERLING SLUMPS
The yen fell after Japanese Finance Minister Hirohisa Fujii said he did not want to be perceived as backing a strong yen. [ID:nTKU105559]
The dollar was last up 0.4 percent at 91.38 yen JPY=, having rebounded from a seven-month low hit on Wednesday.
For the week, the euro rose 0.7 percent against the dollar. The U.S. currency gained 1.1 percent against the yen, the first week of gains in six trading weeks. The dollar index was 0.2 percent lower on the week.
Sterling fell 1.2 percent to $1.6245 GBP= after news that the UK government had set tougher-than-expected conditions for the potential exit of Lloyds Banking Group (LLOY.L) from a state-run arrangement to protect its assets, which underlined the fragility of UK banks.
Lloyds said on Friday it was weighing alternatives to the arrangement to insure it against credit losses. [ID:nLI109343]
The euro rose 1 percent to 90.51 pence EURGBP=, after hitting a session high of 90.57 yen, the highest level since late April.
