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Sunday, March 31, 2013

Weekly Trading Forecasts (April 1 - 5, 2013)

EURUSD
Primary trend: Bearish
The outlook on the EURUSD is bearish. Recently, the market dropped by more than 230 pips from the weekly high of 1.3046. Further bearish plunge is expected, but not without short-term rallies which would invariably proffer good opportunities to sell short in a downtrend. The indicators on the chart confirm this bearish scenario and the price could plunge towards the support line of 1.2700. In the near-term, any short-term rallies are not expected to take the price above the resistance line at 1.2900.

USDCHF
Primary trend: Bullish
Due to its inherent nature, I would like to term this unique pair as being slow and tardy. The outlook here is bullish, but we would do well to note that, no price moves in a straight line (no not one). This means that, now and then, there would be some southward retracement in the price, which is not expected to go below the support level at 0.9450. Since any bearish correction would proffer an opportunity to go long in the face of the extant outlook, the price may go upwards towards the resistance level of 0.9600 (in the next several trading days to come).  

GBPUSD
Primary trend: Bullish
In spite of the recent turbulence in the market, in which the bear occasionally dominated the bull, the major bias on the Cable is to the upside. The indicators on the chart show a Bullish Confirmation Pattern. In recent times, serious bearish pressure nearly rendered the bullish outlook totally invalid, but the bull came back and pushed the price upwards. Because of the currently dismal outlook on Europe, the expected further bullish run on the market would not be that much strong. But at least, the price would reach the distribution territory at 1.5300. 

USDJPY
Primary trend: Bearish
Recently, the pair has traded in a sideways manner. Overall, the price has not gone above the supply level at 95.00 and neither has it gone below the demand level at 93.50. There must be a clear break above or below one of the aforementioned levels before there can be a clearer direction in the market. If none of the supply and demand levels mentioned here is broken, then note that the market is still in an equilibrium phase. However, I would like to mention that it is more likely for the price to break below the demand level of 93.50 when a breakout does occur, for the major outlook on the USDJPY market is bearish.

EURJPY
Primary trend: Bearish
This cross has lately dropped by more than 300 pips! There is a Bearish Confirmation Pattern on the chart, for the indicators support this. Even, in the face of this strong bearish pressure, the price has not been able to break the demand zone at 120.00 to the downside. This is a significant barrier in the current scenario: for the bearish outlook to continue to be valid, the price must break the demand zone at 120.00 to the downside, closing below it and trading further downwards. Before this can be done, there would be a serious struggle between the bear and the bull, but it must be done, for the general bearish outlook on this cross not to be in jeopardy.

 

For more articles, go to: http://www.paxforex.com/forex-blog

Thursday, March 28, 2013

Poem for Meta Trader

Poem for Meta Trader

You connect me to a marvelous world
Where profits are gathered not with words
You enable me to engage and play instruments
You’ve features for me! Ideas inspired into men!
If an instrument looks sexy,
You show it to me, not being pesky,
You couldn’t care less about a trader
You show facts as put by your makers
You’re firm. You’re detached. You’re cute. That isn’t lowly!
Price changes are what drive you
(And the mastery inherent isn’t for fools)
Though I can’t see tomorrow, I’ll make the most of now
To do my best, and manage best, I vow
So that I go in the path of market wizards
So that I remain safe when prices are gripped by blizzards
This is the most popular trading platform! The most used trading software!
This is the trader-friendly means. This is what’s put in the hardware!
(Please listen great traders… Would you suppose I might abandon a means that’s helped me get attention?)
Going back to Meta Trader… I’m relentless
So as not to be any time defenseless
Then concerning the calls… when they get to us
…Oh! How about open orders as if in a bus?
Trading isn’t about avoidance of losses?
Speculation isn’t about leaving bosses?
Now. Great. I’m aware of this. But I trade for a reason
You’re great. And I cherish you. And my portfolios. And the season
And likely I’ve fallen in love for a reason
The Meta Trader… looks dense… Yes that’s me
To speculate and arrange my orders as I see
I expect we realize our aims together
(This is the ultimate aim… but I bet I’m tethered
Perhaps I’m a trader who’s metamorphosed
To call trades, to close trades, I’m not forced
With the cutting-edge tool, I’m hooked)
Congrats! Meta Trader users.


For more articles, go to: http://www.paxforex.com/forex-blog

Tuesday, March 26, 2013

Cupid – Weak Shares

Cupid shares (LSE:CUP) are weak shares as the fact in this piece reveals. The bear is very happy right now because the market environment is favorable to him. When the cross-eyed bear squints, paradoxically, you know it is in a great ecstasy.

On the chart, the ADX period 14 is almost above the level 50, while its DM- is far above its DM+. Meanwhile, the MACD (default parameters) has both its signal lines and its histogram below the zero line – the signal lines are far below the zero line. There is a very strong Bearish Confirmation Pattern on the chart; go short on this market. Any short-term rallies in this market would only proffer unique opportunities to go short at better prices.

Since the year 2012, Cupid has been in a downtrend and it would be sensible for the trader to follow suit. You see when trading, there would be periods of roll-downs and breakeven performances, and that one does not mean that following the line of the least resistance is ineffectual.  

This article is ended with the quote below:

“Trend Following is not dead. At best, trend following is sleeping and
no one rings a bell when markets take off. While past performance is not necessarily indicative of future results some trend followers outperformed the world’s greatest investor and if one was a contrarian thinker now is an interesting time to consider trend following as a strategy.” – Andrew Abraham (TRADERS’ February, 2013; www.tradersonline-mag.com)


Azeez Mustapha

Market Analyst, Trading Signals Provider and Coach



Emed Mining Stock Will Plummet

Here is the technical analysis forecast on Emed stock (LSE:EMED), based on the extant circumstances in the market.

Right now, the price has closed below the EMA 21 and is trading below it, while the Williams % Range period 20 has gone into the oversold situation. This means that the selling pressure is currently strong and is expected to continue. While opening a position, you need to think of the effect of the overall market sentiment, plus how it can have a positive or a negative effect on your position. If bad fundamental facts come when the general sentiment of the market is bearish, the results could be disastrous (in contrast to when fundamental facts come out during optimistic market sentiment, which usually leads to a transient correction in an optimistic scenario). Let us call a spade a spade, for I am not here to tell you that an African albino is a white man. The purpose of this analysis is to make you aware of the reality on Emed.

Bearing this in mind, it is therefore possible that Emed stock would improve in future, but right now, the signal is’SELL.’

The business of trading is just like any other business in the world. Dr. Ken Long (www.vantharp.com), says that he knows from scholarly and popular literature that 90 percent of new businesses fail within the first five years and 90 percent of the survivors fail in the next five years.  Then there are organizations that succeed remarkably operating in the most difficult circumstances. In these environments, failure is typically catastrophic and you would expect it to be the norm, yet certain organizations thrive in conditions of high risk and high uncertainty.

Azeez Mustapha

Market Analyst, Trading Signals Provider and Coach



 

Monday, March 25, 2013

Weekly Trading Forecasts (March 25 - 29, 2013)

EURUSD
Primary trend: Bearish
The dominant bias here is bearish, and this is expected to continue, especially in the face of perpetual weakness in the Euro. There could, however, be some short-term rallies in the price, probably taking the price towards the resistance line of 1.3000. For the bearish trend to be valid, the rally ought not to go beyond the aforementioned resistance line. Meanwhile, the price could reach the support line of 1.2800 in the trading days to come.

USDCHF
Primary trend: Bullish
Recently, the USDCHF pair has traded in a tight range. The pair is expected to shoot out of the equilibrium zone very soon. When this does happen, it is more likely that the pair would go northwards, for the indicators on the chart confirm northward possibility in the market (especially as long as the USD has more stamina than the CHF).  Any short-term pullbacks are not supposed to take the price more downwards than the support level 0.9400, while the bullish pressure may take the price towards the resistance level of 0.9550.

 GBPUSD
Primary trend: Bullish
The trend on the Cable is now bullish and would continue to be bullish. Recently, this wonderful instrument has moved upwards by more than 110 pips, even in the face of recent volatility and turbulence. The indicators on the chart shows a Bullish Confirmation Pattern, plus the current event in the market has proven that buyers have been able to reject any bearish threats. The price may soon reach the distribution territory at 1.5300.

USDJPY
Primary trend: Bearish
There is a ‘sell’ signal on every JPY pair and the USDJPY is no exception. There is a Bearish Confirmation Pattern on the chart, and it would sound judicious to seek short trades at this moment. In spite of transitory rally that may take the price to some supply level of 95.50, the demand level at 94.00 is not a lofty target, and further southward determination may bring the price towards that area (in due course).


EURJPY
Primary trend: Bearish
There is also a bearish signal on this cross. With the current Bearish Confirmation Pattern on the chart (indicators support a bearish bias), the price actions that support the bears would not be a surprise, should the price plunge towards the demand zone of 121.00. It must also be added that there would be some serious volatility along the way. In the near-term, any bullish correction could take the price back towards the supply zone of 123.00, but this is not expected to last too long. In the meantime, the price ought to reach the aforementioned, price zone.

Conclusion: If it happens that a price penetrates an accumulation or distribution territory, breaking through some important levels or shooting out of an equilibrium zone, it usually behaves with some intensity. Following this first shooting out, the price may slow down in its momentum. This is to allow it to decide that the novel bias is tenable. The price may revert towards, or even breach, the recent high or low in the market. Should a speculator who is caught in a wrong direction smooth his positions, and other speculators enter the market in favor of the novel bias, the price might be given a new lease of stamina as it shoots out again, going in the direction of the new bias. At this juncture, traders are advised to stay with the novel direction, not speculating in a contrarian manner towards it.


For more articles, go to: http://www.paxforex.com/forex-blog

Thursday, March 21, 2013

Philip Fisher: An Exemplary Position Trader

LEARN FROM GENERALS OF THE MARKETS - PART 24

“One of the great things about the market is that if you’re a naturally inquisitive person, you’ll never run out of opportunities to learn.” – Brian Shannon

Philip Arthur Fisher lived from September 8, 1907 until March 11, 2004. After dropping out of Stanford Graduate School of Business, he worked as an analyst at the Anglo-London Bank, San Francisco. Then he had a short stint at a stock exchange office and later started his own fund management firm (Fisher & Co.) in 1931. He made uncommon and marvelous speculative profits for his investors. Philip was a very reserved soul; rarely granting audience to the press. He was also very choosy about those whose money he managed. But when his first book titled “Common Stocks and Uncommon Profits" was released in 1958.  The book catapulted him to the ranks of the market wizards and a status of being one of the best traders of all time. Later he released another books titled “Conservative Investors Sleep Well" in 1975, and “Developing an Investment Philosophy” in 1980.  He was very good at making in-depth research on the companies he was interested in. He was a pioneer of growth investing. Philip got many great followers, including Warren Buffett.

Lessons:
Here are some of the lessons you can learn from Philip:

  1. Philip Arthur Fisher was a soldier of the financial markets. He was a market veteran with more than 70 years of experience. He died as a hero of the financial markets. Are you a soldier on the battlefield of the financial markets? Are you a successful soldier? Is trading your passion of a lifetime? If you didn’t have this thought in mind. You’d better start cultivating it now. Trading is a wonderful experience and a fantastic way of life – something that will eventually bring you your desired financial freedom if you don’t relent.

  1. Philip was a very private man. Nevertheless, his trading and investing prowess eventually brought him to limelight. Please concentrate on developing your trading skills; endeavoring to be the best trader you can be. Ultimately, your skills shall make you a famous and a sought-after genius. You’ll eventually join the ranks of the celebrated market wizards.

  1. Philip was a position trader. A position trader is a trend follower who holds his trades for a long period of time. Do you have the patience and the discipline to open orders and hold them for as long as the trend is valid? As a Forex trader, if you’d sold the GBPCHF since July 2007 and held it till now, you’d have gained far more than 10,000 pips on that single trade.  If you’d bought the EURUSD at the beginning of the year 2001 and held it until the beginning of the year 2007, you’d have gained more than 7300 pips on that trade alone. If you’d shorted the EURAUD from the beginning of 2009 and held till now, you’d have gained more than 7000 pips as profits on the position. If EURZND had been sold (at the same time the EURAUD was sold) and held till now, you’d have gained far more than 9000 pips on that. There are far bigger profits to be made by riding the primary trends for as long as they last, but, unfortunately, most of us don’t have the patience and discipline to do this. Philip invested in good companies with highly encouraging facts and figures, and he attained enviable goals in the markets (excellent profits). For example, he went long on Motorola in 1955 and he held onto that till he breathed his last (at the age of 96).

  1. How did Philip select the stocks he would invest in? He gathered as much information as possible on a company. This technique was highly invaluable to him. According to him, there are 15 points to look for in a market, and some of them are quality management and good business characteristics, adaptability, conservative accountability, good personnel management and relations… great sales strategies, ongoing research and products development, encouraging returns, and so on (All these points can’t be mentioned here). One thing that Fisher rarely did was to sell his stocks. He was a permabull: a style that’s no longer suitable for today’s markets. He once said that the best time to sell a stock was "almost never". On the contrary, I’d say that the best time to sell anything is when it’s completely clear that the bullish trend has ended and the bearish trend has been fully confirmed (for position traders). 

  1. According to Philip, what you refuse to do in the markets is as crucial as what you elect to do. There are things you oughtn’t to do as a trader/investor. For example, he said you shouldn’t overstress diversification and that you shouldn’t follow the crowd.

  1. I’d like to mention with interest, the title of his 2nd book (Conservative Investors Sleep Well). It’s possible to trade with peace of mind and sleep soundly when you’ve open positions in the markets. If I know that only 0.5% of my account is at stake, I’ll be able to sleep well. But if about 40% of the account is at stake, I won’t be able to sleep well. The same thing is true when only 5% of an account is being risked as compared to when about 75% of an account is being risked. That’s one of the reasons why I recommend very small position sizing, coupled with other basic risk control tools.

Conclusion: Is anything standing in your way, hindering you from achieving success in the markets? Those who give up after encountering a challenge are feeble-hearted. Do you have a problem pulling out consistent profits from the markets? If the problem isn’t identified, you might end up blaming the wrong person. Never let the fear of the unknown to hinder the benefits you can derive from trading. The unknown have brought millions and billions of dollars in profits to many traders. That’s why risk control is one of those things you must embrace in the markets. Nothing can give you confidence of safety and security in the midst of risk as much as conservative risk control.

A quote from Philip ends this article:

“The stock market is filled with individuals who know the price of everything, but the value of nothing.”



For more articles, go to: http://www.paxforex.com/forex-blog

Tuesday, March 19, 2013

Go Short on Royal Bank of Scotland


The price on the Royal Bank of Scotland (LSE:RBS) is going downwards and would keep on doing so. Since the price reached its yearly peak in January 2013, it has been coming down.

The 4 EMAs used on the chart (the EMAs 10, 20, 50 and 200) confirm the statement above. The EMAs 10, 20 and 50 give a significant bearish signal as the stock trades below them. This bias would soon be confirmed by the EMA 200 (if it fails to halt further bearish move), and there would be a Death Cross on the chart, when the price closes below the EMA 200. Go short on this stock.

The trading world is full of those who know the price of everything and the value of nothing. The corpse does not know how much the casket costs. Traders ought to turn a new leaf when it comes to trading approaches! But it is easier said than done. Nevertheless, the trader who is engaged in learning about the normal trading mindset would continue to improve their personal psychology, as well as their trading skills. This is the trader that may survive all market conditions.

This article is ended with the quote below:

“I am generally aware of the fundamentals of a company, but about 95 per cent of my decision making is based on technical analysis. As a trader, timing is key and
regardless of how good a story may appear to be, if price action doesn’t support the story I consider it too risky to be involved. As I like to say “Only Price Pays!”’ Brian Shannon (TRADERS’ February 2013, www.tradersonline-mag.com)

Azeez Mustapha

Market Analyst, Trading Signals Provider and Coach

Matra Petroleum – Buyers May Be Whacked

Currently, and until further notice, it may be suicidal to open long trades on Matra Petroleum (LSE:MTA). Since the last year, the price has been going down slowly and steadily.

In the current downward bias, the market consolidated lower in the month of February 2013, breaking the lower Trendline before the end of that month. Yea, the price closed below the lower Trendline, and has been trading lower since then. Moreover, the RSI period 14 has gone below the level 50. This is a downside breakout from a consolidation zone: buyers may therefore be whacked.  Any transient rallies would be ineffectual. An astute speculator does not give a damn about transient negativity. This is a wake-up call to the bulls. This market is not favorable to the bulls right now, provided you do not pretend this is a bullish trend. We only wake up he, who in fact, is asleep. We do no wake up a pretender. It is not mandatory which time horizon you are considering – whether higher or lower time horizon. You see the same instrument price ultimately. The mandatory thing to do is to look at the optimal time horizon that would give you a bird’s eye view of what you need to know.

This article is ended with the quote below:

I learned early on that the market doesn’t care about my opinion.” - Brian Shannon


Azeez Mustapha

Market Analyst, Trading Signals Provider and Coach

 

Monday, March 18, 2013

Weekly Trading Forecasts (March 18 - 22, 2013)

 EURUSD
Primary trend: Bearish
Though the primary trend on this pair is bearish, the trend is in a serious jeopardy. There is currently a conspicuous rally on this pair: oscillators have given a bullish signal but momentum indicators like long-term MAs are yet to confirm that. Trading an unconfirmed bias is not recommended at this stage. Should this rally continue further for a few more days, it would see the end of the current bearish outlook. Therefore, it is advisable to wait for further confirmation before opening a new order.

USDCHF
Primary trend: Bullish
In the opposite manner, the outlook on this market is nearly similar to that of the EURUSD. There has been a significant bearish pull on the pair; the oscillators support this, including the price action. It is more likely that this bearish pull would continue, but it is wiser to wait for further confirmation of the supposedly new trend before taking any action. As soon as this is confirmed, the primary bullish trend would be over and short trades would be sought.

 GBPUSD
Primary trend: Bullish
This formerly helpless instrument, which has been battered by the bulls, is now exuding some form of protracted stamina. There has been a Bullish Confirmation Pattern on the chart, and long trades are recommended now. This is still a pretty new trend and it is best to take advantage of it when the price yet remains in its trough. Indicators (including oscillators and momentum technical tools) support this new outlook. Very soon, the price would reach the distribution zone of 1.5300.

USDJPY
Primary trend: Bullish
In recent times, the price on this pair has been moving in a sideways manner. At the time of writing this article, there has neither been a break above the resistance level of 96.50 nor a break below the support level of 95.50. What can be said is that, though the market is in a form of consolidation, the primary trend remains bullish. So when there is a break out of the consolidation, it would possibly be to the upside.

EURJPY
Primary trend: Bullish
Like most JPY pairs, this cross is in a bullish mode, for the indicators on the chart confirm this as the primary trend. There is still a Bullish Confirmation Pattern on the chart, so the price is expected to continue its journey upwards. There would be some bearish corrections along the way, but these would be transitory (not expected to take the price below the market zones of 125.00 or 124.50). Eventually, the price would reach the supply zones of 126.00 and 127.00 respectively.

Conclusion: It does not make sense to keep on following a direction that is no longer valid. Whenever there is a shortage of speculators to continue going in certain direction, the existence of that market direction would be jeopardized. When the price movement is rejected at a significant market level, it is most likely that the trend would turn at that level… In the face of new biases, there would usually be corrections - a result of struggle between the bulls and the bears and medium-term smoothing of positions.



For more articles, go to: http://www.paxforex.com/forex-blog

Friday, March 15, 2013

Teach Your Teens the Art of Trading

“Children are very precious. Parents are also very caring. Do you know these?”

Most parents want the best for their children, and they strive to achieve their aims, even in the face of stubborn obstacles and difficulties. A serious religious parent teaches her/his children about their faith when they’re still very young. In fact, a famous proverb says: “Train a child in the way he should go, and when he is old he will not turn from it.” When an average child is asked, what do you want to be in life? The common answer is: “I want to be an engineer or a doctor or banker or a pilot or a lawyer or a footballer,” etc. No-one will say, “I want to be an online trader.” Why? It’s because this is the mindset that is impressed into them by their folks, since they themselves are yet to grasp the potential of online trading. Those who know about it think it’s too risky, without knowing the principles that can lead to everlasting victory in the markets.

Forex trading is one of the best vehicles that can be used to shield yourself from the persistent pecuniary uncertainties, widespread unemployment and sudden dismissals from jobs, which are so rampant nowadays. Many were having high aims when young, but now they’ve been disillusioned. The idea of going to school, studying hard to get good grades, and then getting a good job, no longer works always.  Why are there very few genius traders? It’s because many people aren’t exposed to the world of trading until they’re very much older. If teens are exposed to trading on demos, as they practice risk-free on the virtual accounts that are subject to the real market data and conditions, their trading genius would be awakened. Wouldn’t you want your child to be a trading genius before the age of 22? Would it be possible for anyone to be a genius in other fields of human endeavors if they’re not yet a genius by the age of 22?

Teens should be taught the art of trading, but they should be restricted to demo accounts only, until they reach the legal age in which they can make independent financial decisions on their own. Yes, teens shouldn’t open live accounts until they come of age. However, they can play with demo accounts (as if playing Nintendo games) until their skills are improved. In this regard, demo accounts are a unique tool in teaching your children. If a child will become great in life, observant parents will notice some traces of greatness in the child while he or she is still young. Your children would learn, by experience that uncomplicated methods of speculation ought to be used. If you really love trading and know that it can bring financial freedom (as it’s done for countless known and unknown people), why can’t you teach your children (especially your teens) how to trade? You can show them how to do this when they’re on holidays or long vacations, and encourage them to do further research on their own and practice their own ideas.

It’s a pity that there are still many people who procrastinate. They don’t know that what can be started today shouldn’t be postponed till tomorrow. Some say: I’m not yet settled down. Once I’m settled down, I’ll start learning Forex.” Others say: “There are some things I’m doing right now. Once I finish those things, I’ll start learning trading.” The fact is that, there’ll always be things you’re doing. So if you don’t start learning, there’ll always be alibis. The earlier one starts the journey to financial freedom, the better. The earlier you start learning about the markets, the earlier you attain the level of trading mastery. My regret is that I didn’t start Forex trading earlier. If I’d started it far earlier, I’d have gone very far in attaining my trading goals and ambitions. But, thankfully, I’m now in the race.  

As for me, I’m going to teach my son on demos, while he minds his formal education, I’ll also teach him how to spend less than one hour per week on the markets, and yet be a profitable trader. I want him to be become a market wizard, becoming financially independent in future, unless he chooses otherwise (since I’m not going to force my opinions on him).

Jeff Cooper, when he was still young, learned the art of trading from his father, and he later became a legend of the Wall Street. He had love for trading that kept him searching until he discovered the secret of permanent success.  Mike Baghdady learned from his father, and has now become a blessing to the trading world. Peter Soodt learned from his father, and he’s now a celebrated and profitable trader/coach. Joe Ross was taught by his uncle when he was as young as age 14, and he’s now one of the most experienced and the most eclectic traders in the world. He trades for a living and has insatiable passion for teaching how the markets work. Philipp Schroeder and Valentine Rossiwall are both young and highly profitable traders. Philipp and Valentine have other goals in mind, yet they take trading serious. Oh, how bright and beautiful the future of these young men would be! Anton Kreil started trading while in his late teens and he retired from the investment banking industry at the age of 28. He now trades his own money and enjoys financial freedom, and he’s still in his early 30s. Kenneth L. Fisher learned about trading from Philip Fisher, his father (who was a great investor) before he founded his own investment firm.  He’s on the 2011 Forbes 400 list of richest Americans. He was worth $1.7 billion in the year 2012.  As of 2010, his company manages $41.3 billion in 38,521 customer accounts and has been called the largest wealth manager in the United States.

With time, your kids would be forced to be disciplined – in the face of negativity and uncertainties they face on demos. This really calls for rock-solid discipline, meaning that one needs to stick to one’s time-tested trading plans. Negativity shouldn’t be termed as stupidity, for that notion can’t help their trading mindset. If they follow their trusted trading rules and they make profits on demo, they’d be happy. It’s joyous to see your efforts bringing great results and that your goals are being achieved.

Conclusion: The world needs traders – profitable traders. Would your kid be one of them? Successful traders came from many areas and different walks of life. They have individual personalities, various strong points and weaknesses. As your kids have a feel for the markets, they’ll forever remember their mistakes and a number of beautiful trades – a great experience that’ll pave the way for trading mastery. They’ll quickly metamorphose into mature traders. Sharing trading facts with others bring us more satisfaction than keeping the secrets to ourselves.

This article is ended with a quote from Louise Bedford:

“You see, studies have shown that those who believe that they can alter their behavior and their habits to create a different outcome are happier people. They persist for longer. They score better on tests… Those who think they can't change, and that intelligence is fixed tend to quit at the first sign of trouble and don't stick around long enough to master a skill.”


For more articles, go to: http://www.paxforex.com/forex-blog



Tuesday, March 12, 2013

Thomas Cook – SELL

Why should we go short on Thomas Cook (LSE:TCG)? It is because the selling pressure in the market is increasing. There has been some serious short-selling in the market, and certain private traders want to sell accordingly? If an elephant trumpets, would you also expect its calf to trumpet?

The price on the chart has crossed the EMA 21 to the downside and closed below it, while the Williams’ Percentage Range was shot into the oversold region (below -80) before bouncing upwards. The present weak rally in the price, coupled with the Williams’ % Range bounce from the oversold region, gives an opportunity to sell at a better price.

We got to determine to keep on gathering as much information as possible about the markets, but not hoping the results to be an instant thing. We never can envisage how soon permanent success can come to us, since it got to do with an individual trader. Anyone standing for an instant gratification would eventually attain less speed with more haste or may not even achieve any speed. That is why it is great not to look for instant gratification, for the ultimate thing in trading is not instant gratification, and it is something that can be done away with.

This article is ended with the quote below:

“We can never be fully prepared for all of the potential negative events which impact price action. We need to have a strong defensive plan in place from the start to assure that we will be able to remain in the market and have the opportunity to make up for losses which occur after those events.” - Brian Shannon (TRADERS’ February 2013, www.tradersonline-mag.com)


Azeez Mustapha

Market Analyst, Trading Signals Provider and Coach

Kibo Mining: When Will The Price Turn?

Kibo Mining (LSE:KIBO) is currently at a critical level. Would the price turn upwards and assume a protracted uptrend or would just plummet further? The answer is below.


The ADX period 14 is at the level 30 (with the DM- far above the DM+): this shows a strong bearish pressure. The MACD (default parameters) histogram and signal lines are all below the zero line. All these actions testify to a strongly bearish market, and it is thus suicidal to go long right now, until it is clear that the weak trend is over, although, further downtrend in the market would be punctuated by transitory rallies. There is no way of preventing a weed sprouting up on a large vegetable farm. The optimal period to go short is when there has been a Bearish Confirmation Pattern in the market. Going short with the kind of price action puts the odds of success in our favor, as we wager our allocated fund and put the risk control parameters on the open trades. With a stable trading strategy you would usually know what to do in case of any eventuality in the markets.

This article is ended with the quote below:

Once a trade is not going the way you want it to, emotions jeopardize your actions because any uncertainty is perceived by our brain as a disturbing emotion that sometimes causes devastating actions to be triggered.” – Norman Weltz

Azeez Mustapha

Market Analyst, Trading Signals Provider and Coach

 

Sunday, March 10, 2013

Weekly Trading Forecasts (March 11 - 15, 2013)

EURUSD
Primary trend: Bearish
There has been a recent potential reversal on this pair. The bullish reversal is noteworthy, but not significant enough to override the major bearish outlook. It is better to wait for further confirmation before new positions are opened (at least for a few more trading days). Whether the current scenario is a transitory rally in the context of a downtrend or it is the beginning of a new trend remains to be seen.

USDCHF
Primary trend: Bullish
Despite the current pullback in the market, the long-term bullish bias on the USDCHF still holds. Since the beginning of February 2013, this pair has moved upwards by more than 300 pips – a slow but steady progress indeed! Right now, the pullback in the market is not expected to go below the support level at 0.9400 or at worst, it should be halted by the immediate support level at 0.9350, after that. It is expected that this pair goes in a continuous bullish journey. 

 GBPUSD
Primary trend: Bearish
The Cable continues its weakness – a scenario that is expected to hold out longer than this. There is still a Bearish Confirmation Pattern on the chart, as indicators support a bearish bias. Any rally in this market is simply an opportunity to sell short and sell dearer. The trend is never over until it is actually over, so it is possible for the price to reach the next accumulation zone at 1.4900 in the long run. 

USDJPY
Primary trend: Bullish
This is a bull market, and it has risen by around 170 pips recently. There is a Bullish Confirmation Pattern on the chart; the price is still expected to continue going upwards. There could be some temporary bearish corrections pulling the price backwards to the market levels at 94.50 and 94.00 respectively. But eventually, the buying pressure should push the price towards the supply levels of 95.50 and 96.00. 

EURJPY
Primary trend: Bullish
This cross traded in some tight range recently, before the price broke the market zone of 122.00 to the upside. Shortly after this, the price shot northwards by more than 250 pips on Thursday (March 7, 2013). Now, the new bullish signal has been confirmed. This seems to just be the beginning, and while transient bearish corrections could occur along the way, the price may trend upwards and reach the supply zones of 125.00 and 126.00.

Conclusion: The major bias would invariably exert a strong influence on the possibility of profitability of your speculative methodology. We cannot afford to use a method suitable for an equilibrium market when following a great trend; which means that a trading method suitable for equilibrium markets ought to be used in equilibrium markets. Nevertheless, should the price show any sign of great momentum, it should be followed.

This article is concluded with the quote below:

“Your goal should be optimal profits, not emotional comfort.” - Ziad Masri



For more articles, go to: http://www.paxforex.com/forex-blog


Saturday, March 9, 2013

Louise Bedford: Trading Secrets Can Be Yours

LEARN FROM GENERALS OF THE MARKETS - PART 23

“After trading for this long I feel I should have some brutal stories, I don’t! I guess I
had great sources for learning and I always had a good grasp of risk management.” - Chris Cashman

Louise Bedford (a wife and a mother) is one of the best female traders on this planet. This notable Australian obtained degrees in Business and Psychology, and has proven to be able to survive all market conditions. When it comes to making complicated trading topics look as simple as ABC, she’s superior. With her teaching skills, and assiduous coaching endeavors, she’s assisted many formerly trading novices to metamorphose into experts. She’s presented some coaching works, including trading methodologies that can speed up one’s learning curve. Even, many other trainers have followed her examples by using her models while training others.  With great zeal, many people have been assisted to be the best traders they can be. As a result of this, she’s a highly sought after guest speaker at trading seminars and conferences. She’s authored some popular trading books like: ‘Trading Secrets,’ ‘Charting Secrets,’ ‘The Secret of Candlestick Charting and the Secret of Writing Options.’ You can benefit from Louise’s excellent tutorial services by accessing her website at: Tradingsecrets.com.au.

Lessons
The most interesting thing about Louise Bedford is what you can learn from her example. Here are some of the lessons:

  1. It’s part of Louise’s trading tactics to stay away from the markets that aren’t sexy. Trading the markets that move protractedly in a zigzag or sideways or highly unpredictable manner can’t improve your trading stats. Trade only sexy and attractive markets, i.e. the markets that are trending well (moving in a predictable manner).  

  1. There are highly successful traders who’re also effective trading coaches, just like Dr. Van K, Tharp, Joe Ross, Steve Ward, Ken Long, Mike Baghdady… Louise Bedford, etc. These people have left indelible footprints in the world of trading (and they’re still active). Learn from them; learn from other great coaches whose names aren’t mentioned here. But you need to follow their track records first. I don’t think people can give what they don’t have. If a coach can’t trade successfully on their own, can they teach others to trade successfully? I prefer to take lessons from those who’re successful traders themselves. Are you facing recalcitrant challenges in trading today? Please enlist the help of a successful trader who’s also gotten a nice teaching talent. I’ve done it and it’s worked for me!

  1. I’ll continue to reiterate that our women have some precious innate qualities that can be used to their advantage in trading (but mentioning those qualities is beyond the scope of this article). Hetty Green, Linda Raschke, Kathleen Brooks, Kathy Lien, Tillie Allison, Dr. Janice Dorn, Louise, etc., are trading experts. Profitable trading isn’t men’s birthright only. Your girlfriend can be a successful trader. Your sister can be a successful trader. Your aunt can be a successful trader. Your niece can be a successful trader. Your mom can be a successful trader. Your daughter can be a successful trader. Your sister-in-law, mother-in-law, or daughter-in-law can be a successful trader. Your half-sister or stepmother can be a successful trader.

  1. What can you learn from trading coaches? You can receive peerless and insightful lessons from them, and these can take your trading experience to the next level. Louise Bedford, featured in this article, once included a helpful lesson in one of her past newsletters. Here’s an excerpt: ‘TRADERS – we’re an impatient bunch. Some of us take our foot off the accelerator just before we cross the finish line. The lovely Verica Cvetkovik shared these words of wisdom on our exclusive Mentor Program forum: You take a little seed, plant it, water it, and fertilize it for a whole year, and nothing happens. The second year you water it and fertilize it and nothing happens. The third year you water it and fertilize it and nothing happens. How discouraging this becomes! The fourth year you water it and fertilize it, and nothing happens. This is very frustrating. The fifth year you continue to water and fertilize the seed and then... take note. Sometime during the fifth year, the Chinese bamboo tree spouts and grows 90 feet in 6 weeks.
            Life is much akin to the growing process of the Chinese bamboo tree. It is often                    discouraging. We seemingly do things right, and nothing happens. But for those who do things right and are not discouraged and are persistent, things will happen. Finally we begin to receive the rewards.’ (Source: Tradingsecrets.com.au). Did you know that someone who’s planted a cacao tree will need to wait for 4 years before he/she begins to harvest? We shouldn’t give up trading if we face initial challenges. Our breakthrough is nearer than we may imagine, and once we attain it, trading would become far easier. It’s extremely difficult to achieve permanent victory in the markets if we aren’t doggedly patient.  

  1. Everyone was born into this world with a potential for becoming a great trader. But as you expect, it’s one thing to have the potential to be something, but it’s entirely a different ball game to run in the race and actualize the potential.  If you want to be a top trader, acquire a good trading skill. The market needs diligent, hardworking and skilled traders to tap its riches. You can’t afford to trade the ways others are trading and become a successful trader. Others hold onto their negative trades and truncate their positive traders, but you can’t afford to do that. Every potential market wizard would need to face severe situations, circumstances and experiences before becoming a market wizard. The one who’ll excel must be disciplined. You can be great. There’s a crowd at the bottom, but too few at the top. There’s a plenty of room at the top, but the issue is whether you’re willing to do the work that’ll qualify you for the top. To remain on top, there’s a need to continue to improve your skill and knowledge. Try things a bit different from how you normally do them.

  1. As unpleasant as losses are, for all traders, it’ll take facing losses triumphantly to move you to the next level in trading. May the losses that come your way from now bring out the best trader in you. Are you a facing some losses today? Congratulations! You’ll come out being a victor. Losses are an assurance that there is something greater on the other side. It’s your risk control tactics that will show your probability of survival in the long term. It’s foolishness to trade the markets without risk control measures.

Conclusion: Profitable traders face many of the challenges we encounter, and they overcome them successfully. Some of the sweetest moments of our trading life have been during the most difficult days. After all, we trade out of genuine love for it. Not only we do the right things on the markets but we’ll enjoy doing them and also get rewarded. Market wizards’ trading ideas benefit not only themselves but anyone who learn from them.

This article is concluded with a quote from Louise:

“You see, we live in an age of entitlement where the majority of people expect to win, and often give up at the first sign of a struggle. They seem to think that all they need to do is take that first step, and success will be assured… However, you and I know that this isn't the case. The first step, while hard to make, is simply that... it's just the first step. To really excel, you must continue to push forward.”

Azeez Mustapha

Market Analyst, Trading Signals Provider and Coach

 

Tuesday, March 5, 2013

Annual Trading Forecast on Microsoft (2013)

The market situation on the software giant, Microsoft (NASDAQ:MSFT) tends to discombobulate some trading neophytes. But how the price would eventuate in this year is explained here.

On the chart, 4 EMAs are used. They are EMAs 10, 20, 50 and 200 (the color that stands for each EMA is shown at the top left side of the chart). The EMAs 10, 20 and 50 show that the medium-term trend is bullish, especially since February 2013. Should this new bullish bias continue, the price would eventually cross the EMA 200 and close above it. Right now, the EMA 200 is acting as a great barrier – a big supply zone – against the bulls’ interest. So the cross of the price above it would show the total end of the recent long-term bearish outlook. Whether this is secretly done by the bulls or not, it would be detected. If you fart secretly, others will perceive the odor secretly.

Most speculators dabble into the stock market with a faint idea of getting rich, but they seem not to have the time to learn how the markets really work and how they can benefit from that.

This article is ended with the quote below:

“I expect trades to work over time. I know it may sound a little over confident, and I
genuinely don’t want it to come across that way, but honestly when you’re trading for a while, you expect your trades to work. I don’t know if the next trade is going to work or not but I expect over time that they will and that most of them are going to work for me. You need to have confidence in your trading ability.” - Mark Holstead (TRADERS’ February 2013; www.tradersonline-mag.com)

Azeez Mustapha

Market Analyst, Trading Signals Provider and Coach

Aminex PLC - The Shares Are Strong

The Aminex shares (LSE:AEX) are now technically strong, based on the reasons given below. The bull has shrugged off any possible selling pressure in the markets, therefore covering itself with its preferred buying pressure; just as the onion has its preferred costumes all over its body.

The shares traded in some tight range from the middle of January to the end of February 2013. After this, the price broke upwards from the upper Trendline, closing above it. This breakout and the subsequent further bullish move were significant. The RSI period 14 went seriously above the level 70 before retracing downwards a little. This is a ‘buy’ signal in the market (for the price is expected to continue with this bias).

Effective speculators possess great positive expectancy strategies. The positive expectancy does not mean there would never be a losing trade. Would you quit a potentially profitable business in the year or the month you make more loss than profit? Probably you will not do this, as a result of your knowledge, which tells you that things also do turn in your favor eventually, especially in the long run as long as you stick to your winning business principles.

This article is ended with the quote below:

“Trading is psychological warfare…  Trading requires self-limits and personal accountability.” Dr. Woody Johnson

Azeez Mustapha

Market Analyst, Trading Signals Provider and Coach



 

Sunday, March 3, 2013

Weekly Trading Forecasts (March 4 - 8, 2013)

EURUSD
Primary trend: Bearish
This pair has trended downwards recently, with each intermittent rally providing a great opportunity to sell short. However, the downtrend has not been so strong because the price has hardly gone below the support line at 1.3000. The major bias remains bearish and it ought to continue so. Eventually, the price might broke the support line of 1.3000 to the downside and eventually close below it. Then the next target could be the support line at 1.2900.


USDCHF
Primary trend: Bullish
This market has been able to uphold it bullish bias so far. The price has not gone too far, and therefore, has more room to go. Recently, the bullish journey has been tardy, but sure. At the time of preparing this article, the price was above the resistance level at 0.9300; it would not be difficult for it to break the resistance levels at 0.9400 and 0.9500 to the upside.

 GBPUSD
Primary trend: Bearish
All indicators on the Cable show a downtrend. There is still a Bearish Confirmation Pattern on the chart. This bias will continue to drag on; even any short-term rally would be a great indication to open a short trade. So, in spite of the current weak rally, the price is expected to plunge and break the accumulation territory at 1.5100 to the downside. If the price is able to close below that accumulation territory, the next target would be the price territory at 1.5000.  

USDJPY
Primary trend: Bearish
The bullish trend is over on this pair, but the current bearish scenario is under a serious threat, owing to some northward correction on the USDJPY, following its significant bearish plunge on February 25, 2013. No matter what, one should not seek long trades on this pair until a clearer signal is generated. Right now, it’s more probable that when there is another significant movement on the USDJPY, it would be in favor of sellers.  

EURJPY
Primary trend: Bearish
This cross experienced a serious bearish run on February 25, 2013.  That day alone, the price nosedived by over 500 pips! After this, the price tried to recover a small part of this huge loss. Interestingly, what looks like a rally now is another good opportunity to sell short, for indicators on the chart confirm that the bearish scenario is extant. The price may eventually break the demand zone at 120.00 to the downside, heading towards the demand zone at 119.00. 

Conclusion: The world of speculation is there as a result of the battle of the bull and the bear. Whenever there are buying and selling activities, there would be gainers and losers. Both buyers and sellers cannot make gains at exactly the same time, since the market either goes northwards or southwards. Also, when the market is in an equilibrium phase, there would be buying and selling activities on a very short-term basis. This shows that both the bear and the bull are still active.



For more articles, go to: http://www.paxforex.com/forex-blog
 
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