Thursday, July 2, 2009
The Simpler the Better?
A lot of people trade using lots of indicators. Some trade using Forex robots or Expert Advisors that are based on indicators as well. But there is a school of thought that says that trading using indicators has a big disadvantages.
Disadvantage number 1:
Lots of indicators will clutter the screen and in the end, we will not be able to tell what the market is really doing and what direction it is really going and we end up making the wrong decision. All thanks to the whole lot of indicators that are supposed to help.
Disadvantage number 2:
The indicators lag. Most of the time, when the indicators have shown a nice tradable move in the market, the move would have already reached its end when it is revealed by the indicator and trading based on the indicator would be unwise. Although sometimes the indicators do predict the correct subsequent moves.
Therefore, some people think believe that using just 1 or 2 indicators would be enough, and then based on them, a system is developed and the traders would just stick to the system with discipline.
Sunday, June 28, 2009
Super Long-term Breakout Strategy
Why do I call this strategy the super long-term breakout strategy? Well, it is because this strategy is used for long-term trading and it is very profitable.
The concept is simple. When a breakout occurs and the breakout is from a very very strong and long-time support or resistance, the price will 90% move further and further past the support or resistance, creating a super strong trend in its direction.
So what is this strategy? Simple. When you see such breakout, wait for a while to make sure it is not a fake break, and then trade in its direction! Of course, you can do some indicator analysis or candlesticks for confirmation but then again, when there is such a breakout, you know you will have some high chances to reap some long-term profits.
Using Candlesticks together with Indicators
This is one of the most effective strategies to use when trading Forex. Using Candlesticks together with Indicators.
Candlesticks are good signals. They show you the price actions and they show you where the market is likely to go. But sometimes, candlesticks maybe wrong.
Indicators, on the other hand, are doing the same thing but for a longer period of time. Usually, they work on past data of the market and at the same time, tell you the movement of the market based on the averages of the past data. They maybe good but they lag behind. Following solely on indicators will not ensure that you trade at the correct time.
But by combining indicators and candlesticks analysis, you have double confirmation and can trade more confidently. My favorite strategy is using Candlesticks with Stochastics. When the stochastics indicate Oversold and when I see a reversal candlestick signal, I know that it is Buy time!
Thursday, June 25, 2009
Complete Reversal?
Final days of June 2009. A month ago, USD and JPY were plunging down. They were easy pickings for easy profits. You can just buy GBPUSD or GBPJPY just to profit instantly. But this month, not anymore.
It seems that a complete reversal pattern is imminent here. Great Britain Pound, Canadian Dollars and Australian Dollars, the 3 bullish currencies, look like they are taking a big turn. They are showing more days of bearish candlesticks, especially Canadian Dollars.
USD and Japanese Yen are pushing the charts and are breaking their downtrends. The question is whether it is a temporary big retracement and they will continue to drop after that, or it is a true reversal and the two underdogs are finally making a comeback.
Tuesday, June 23, 2009
Time Cruiser 3
Forex is a tricky game. And that is the ultimate reason why most people who trade blindly or take it as a gamble lose big time. Those who trade at the “advise” of others fail as well. The people with solid systems and good discipline are the ones who can actually profit from Forex. And even so, those people with good systems sometimes lose trades.
I have developed several Forex trading systems. Some are scalping systems, some are day-trades and some are position-trade systems. They all have their limitations but I will always be trying my best to perfect them to ensure a higher win-ratio and a lower risk exposure. My latest system in development is called “Time Cruiser 3”.
Time Cruiser 3 will be using day and position trading strategies mostly, for a more stable trading experience.