Inside Trade - Skewered For Good

Andrews Median Lines or more popularly known as Andrew's Pitchfork, is a technical indicator which aims to determine the possible support and resistance levels.

The indicator is named that way because a pitchfork like figure will be displayed after it is applied in the platform properly and successfully, skewering the chart with three parallel lines. The three parallel lines which made up this pitchfork are the median, resistance, and support lines.

It is plotted by placing the points on the three most recent peaks or troughs. The first point will extend as the median line while the other two points will interchangeably the support and resistance line depending on the market movement.

Inside Trade | Holidays

According to Fundamentalist, world occurrences dictate the values of currencies. Entangled and struggling between the optimistic and pessimistic forthcoming while dictating its imminent effect, as so they say. Absurd maybe, but occurrences is not only limited to the scheduled and unscheduled political and economical activities. It also includes the usual activities like holidays.

How does it affect Forex?

Tackling its significance in the market gives a better understanding on the market behavior. Basically, holidays will cause a slowdown in the economy because almost everyone is not working. Even most traders would most probably want to spend their time and hard earned money with their family. As a result, it decreases the trading activity in the market thus limiting the market volatility in the process.

But there are still those who are willing to work despite the free day. Some traders still engage in trading in this times but it's dangerous and often end up on the losing side. Almost all trades are only carried out using the majors and using exotic ones could be suicidal especially if the weekend is already at hand. Also, most trades are conducted in really high volumes because the movement is limited.   

Forexcast | EURUSD November 28,2012

The positive news from both currencies wrestled its value. The finalization of the deal to save Greece from its looming debt has created optimism for euro investors. Meanwhile, the same effect was also achieved after the U.S. elections was favored by most Americans a few weeks ago. Today, a correction started at around 1.2970 which paved to the formation of a head and should. Traders should expect the correction to last until 1.2900 value but will soon rise to continue its upward way. 

Take note of the Support level  23.6 which is slight above the 1.2895. Traders can ride this short plunge for today but don't put your TP far below 1.2895 value because most probably it won't be hit. The pair is still not been overbought thus the trend reversal is still nowhere in sight.  

Venturing on Forex | ForexCopy Follower

There are numerous reasons why investors uses the Forex copy system. But the bottom line is that it is comfortable, instant, and most importantly secure way to put your money into work. Any person with the guts and wits to invest in Forex doesn't have to go through the rigorous learning phase anymore. With the help of the system, you can skip all of that without risking your capital. All you have to do is follow the simple steps to enroll in the ForexCopy system as a Follower then viola! It's good to go.

Steps for ForexCopy Follower:

1. register a live account
2. register in the ForexCopy system as a Follower.
3. Choose from the monitoring list and read the copying terms of the trader.
4. Follow the trades

ForexCopy Follower is the one who is copying the successful trades of a ForexCopy Trader. They can legally copy the trades of other persons and at the same time choose which trades to copy. It diversifies the risk because you can choose to copy from different traders depending on your own preference. They can also closely monitor their investments and select which mode of payment they want, either per day or per commission.

Forexcast | EURUSD November 26,2012

Williams' alligator is hunting good this week and no signs of corrective waves is at sight. As expected from our previous forecast last November 24, the market will still be trekking the bullish trend giving a definite signal for buy orders.

I recommend traders to first go short on buy orders for a good 30-50 pips because even though it's definitely a bullish trend, an inverted head and shoulders may be formed in the near time and fluctuations that comes along with it. Better let you're positions breath by providing the TP and SL not to close but at the same time not to far from the current value.

For long positions, better ride the bull trend for quite some time but watch out for the end of second wave which will most likely stop on or before the 1.3160 mark.

Forexcast | EURUSD November 24,2012

The EURUSD pair penetrated its line of resistance for this week and will most likely pursue its current trend. The last influence of the bearish trend was shrugged off last November 13 and any doubt for the reversal has been cleared.

Furthermore, the bullish trend for the second wave is still strong and may continue for quite a while as indicated in the RSI below. I advised the traders to go on buy this week but be wary and closely manage the TP and SL orders because it may not push through the next resistance level marked above the 1.3155 value.

Inside Trade | Will Yuan take over the Greenback?

As the Chinese stunted growth was recently resumed, rumors about China overcoming the United States in the near future had been recently spreading. Indications are everywhere, especially after its recent aggressive movement in their territorial dispute. Its unyielding claim against five neighboring countries displays its capacity to overpower the other claimant despite its advantage in number.

The continuous population increase is one of the major driving force for its economic growth. At present, they are now ranked as the second largest economy next to the United States. They are widely popular due to their cheap labor force which is very attractive to investors. But there are things they have to reform if they want to take the pace into the next level. Corruption is widespread, greatly damaging its citizens and industries. The lack of a unified voice may also be added to their things-to-do list as well.

In my opinion, if however the predictions were true. It wouldn't happen in a few decades and maybe even more in a couple years. It will take its time and so must us. I think it is still too early to sell all our dollars and start investing in yuan. Its better if we lay back ourselves for the meantime and watch as history unfolds itself.  

Forexpress | Positive Outlook for the US Economy

After President Barack Obama's reelection 2 weeks ago, most Americans is now sharing the optimistic view to the United States economy in the near future. Signs of a rising economy is already stepping in one-by-one as the leading economic indicators are rising. The jobless claims and gasoline prices was also reduced last week while others such as home values and job growth is starting to propel upward.

“ The outlook is better than it has been over the last three or four years – that's what Bernanke told us yesterday,” according to Harm Bandholz, the chief U.S. economist at the UniCredit Group in New York.

The S&P 500 Index also ameliorated from what it has been four days ago with a 0.2 advance. The gasoline which is a very important commodity dropped its price per gallon at $3.41.

Forexcast | EURUSD 11.21.2012

After the hanged man showed itself yesterday, the confirmation for a reversal has been fortified. The trend which is now on the bearish move will most probably break the first layer of support. Traders may ride the down surge for a while until before the 1.2640 mark which may be the testing ground. According to my wave interpretation, the second wave is just forming and may break the 1.2910 value before it is done.

R1: 1.2910
R2: 1.3175

S1: 1.2750
21: 1.2640

Inside Trade | Unsung Side of Short Term Trading

Many traders nowadays are involved in short term trading. The technological advancement permits us to do such and even birthed to a new genre this past years. But many may not notice one thing obvious about this type of trading. The lesser the time, the lesser the profit.

In our orientation, we may have been told that short term trading involves a lot of trading opportunities because every pip can be a profit waiting to be caught. Like fishing, wherein you may dip your bait in the water every now and then catch some small fry because a lot are passing by. Yes, I think it is true but have ever considered the volume of the catch at the end of the day. Of course you may profit on most trades, but have you put into the equation the unprofitable ones?

In reality, a big catch may take a while before it may be caught. It needs time and skills to earn huge. There's no shortcut to success. Even if you really did great on a day, how about on the morrow? Can you still repeat it? What I'm pointing out is that the shorter your time frame is, the more limited you're from profit. Most successful and seasoned traders knows that the market may only move significantly small for few minutes but as time goes by, its movement also widens. A larger movement also means a larger profit. So before trading short, think again.

Venturing on Forex | InstaForex Catalog

Most traders and analysts needs a collection of knowledge to refer whenever a question pops out of their mind. Though there's a blur distinction of truth in the internet, some websites provides a clue or a hint of which is reliable and which is not. The trick to solve it is quite obvious and may be found on academic researches; abundance of sources.

Comparing one source to another, the truth to the topic may be filtered out like gold nuggets in a handful of river stones. But a wide stream of resources and diligence is utterly needed to carry out such procedure.

To alleviate such conquest for truth, InstaForex decided to make a collection of resources in which traders can refer regularly. Forex Catalogue provides a list of reliable websites contributed by both the company and some concerned traders. Each website is carefully and scrupulously inspected by the specialist of the company before it is included in the list. Even though the company cannot fully vouch for the reliability of its contents, shifting from one source to another may narrow down the list.

Inside Trade | Chart Patterns: Head and Shoulders

After discussing about patterns in my previous post, I deemed to go a bit further down the topic by discussing one of the most famous and widely popular pattern – Head and Shoulders.

Head and Shoulders according to my research is one of the most famous reversal pattern. Reversal means that there is a change in the direction of the trend. It is meant to go to the opposite direction of the trend. Head and Shoulders is found on both the bullish and bearish trend but is named differently depending on the current pattern. If in case the trend is bullish, it is called Head and Shoulders Top. On the other hand, if it is in the bearish trend, it is called Head and Shoulders Bottom.

The pattern is composed of three parts: left shoulder, head, right shoulder. A horizontal line is drawn to serve as the neckline for the pattern which makes it similar to a head and shoulders of an alligator.

How it is formed?

The left shoulder is normally formed after a long movement in the market. After its formation, price usually goes to the opposite side until it reaches a value which will reverse it. At this point, the head will be formed as the price rises until it reaches a peak higher than the value of the left shoulder. It will again start to descend until its reversal which will draw the right shoulder. The highest value of the two shoulders are usually the same or almost the same. The neckline will be drawn by putting a horizontal line between the beginning and ending price of the head.

Inside Trade | Introduction to Chart patterns

Charts maps out the past movements of the market. It's like a history book, only it gives a history of prices. As the most famous history phrase goes “history repeats itself,” often true and gives us the vantage of learning from past mistakes without actually experiencing it. The same goes for Forex.

After spending sometime analyzing and monitoring charts, you will most probably observed that some formations found in the chart are often repeating. Patterns as they were called. The patterns may vary depending on the chart that you're using. Candlestick charts have different patterns than those of the bar chart. Through the course of time, numerous patterns have already emerged but those classical ones are the famous among them.

Classical Patterns:

• Head and Shoulders
• Trend lines
• Triangles
• Wedge
• Flag and pennant
• Price
• Broadening top
• Triple top and bottom
• Double top and bottom
• Cup and handle

Some are claiming that they can predict future price movements through these patterns. But the pessimistic ones are rebuking the claim and telling that those patterns are just mere economic illusions. Honestly, I'm really not a hundred percent sure on which is which but I think it's now up to the trader to decide.  

Venturing on Forex | Analyst of the Year

Forex nowadays is gaining its popularity throughout the world. Most educated individuals understand its basic concept but unfortunately, it is not an investment that anyone can enter. There are some who dared to test the waters and failed. Without skills and knowledge of the trade, the chance of surviving is almost to none. But there are those who are employed by InstaForex to aid the less knowledgeable traders in their day to day trading. Individuals who have sufficient knowledge in trading to serve as a guide the clients in their trading decisions - Analyst.

The analysis may vary from person to person, depending on the strategy that they are using. Fractals, Wave, Fundamental and Technical analysis are some of the most common type. But how does a trader discern the best analysis if they are profitable?

InstaForex launched its “Analyst if the Year” award to crown the most able and popular analyst among traders. It is a contest open to all but the participants are mostly professional analyst. It is categorized into three according to years of experience. Premier League, League One, League Two.

Premier League is the category for the analyst whose experience has surpassed more than three years of work in the foreign exchange market. Meanwhile, League One is composed of analyst whose experience is in between from 1 to 3 years. Furthermore, the League Two is made up of young analyst who has less than a year's worth of experience.

The winner of the award will be determined by the number of votes and the category will not matter in judging. So I advise aspiring or professional analyst out there to join and participate in this event because it will not only boost your career, it also have a hefty sum along with it.

Venturing on Forex | InstaForex map

Nowadays,the existence of ill-fated brokers cannot be denied, most especially in the virtual realm. A realm wherein every company may be the master of its own, being able to impose their will to their customers, even with an integrity weighing equal to a feather.

It made every seasoned traders wary and the beginners like sitting ducks waiting to be plucked and shot. Of course there are certain forums or sites that caters to the unheeded complains of the customers, but after visiting some of those self styled website, the rants turns into cliché whose worth is not more than a penny. I guess it cannot be helped if pessimistic investors cannot even deem to entrust their money to a broker whose name have been slightly blemished. But how do we discern the good ones from the rotten ones?

One of the qualities that may separate the true from the false is their visibility. Visibility reinforces a broker's integrity. Doubts are easily erased if someone could continuously answer every question catapulted by its customers. Moreover, if the visibility materializes outside the virtual world. A customer's fears may be put at eased once they have a representative willing to answer their every query face to face.

InstaForex gives this matter an utmost consideration. Its willingness to provide services founded between trust from the company and its customers gave birth to more than 220 representative offices in 31 countries worldwide with its headquarters situated in Kalinigrad, Russia. It is a relief for the customers of the company and serves a sigil for prospective clients. A symbol that this company means serious business and means to forge a long time mutually beneficial relationship with its clients. So if you're a trader who is thinking where you're gonna invest your money, try to research and seek for their real intention first. It might take some time but it will most probably save you from those rotten ones.

Inside Trade | Not your 007 - Bonds

Instrument given by an issuer to the holder; it is a proof that the issuers owes the holder a debt. It obliges the issuer to pay an interest from the debt and the owed principal in the future. The interest is usually paid on a regular schedule and the bond may be sold after the maturity.

When a governments, municipality, or company needs additional money, they will issue a bond. But unlike stocks wherein you're a part of the company, whether it goes up or down, bonds' price are not subject to change. It is like lending your neighbor an amount and he/she agrees to pay the amount in the future together with an interest. The interest which is regularly paid are called Coupons.

There are several types of bonds namely: Government, Municipal, Corporate, and Zero-Coupon Bonds.

Government

Obviously, this are bonds issued by the government itself. They are fixed and usually has the lowest risk among its species because governments are seldom go to bankruptcy.

Municipal

Also called as “Munis,” Municipal bonds are bonds given by the municipality, usually on a resident of the said municipality. What makes this bonds attractive, taking into account that it has a higher risk compared to government bonds, is that sometimes the return from those bonds are free of tax in case the holder is a resident. But please take note that the yields may be lower than those taxable ones.

Corporate

The riskiest among them, Corporate bonds are bonds issued usually by big corporations. It has the most risk because it has a higher chance of a default. If in case the corporation who issued the bond became bankrupt, the amount owed cannot be repaid. But these type of bond usually has the highest yield compared to the former two.

Zero-Coupon

This type of bond is a bit different. Compared to the previous types, this bond does not give a coupon but in return gives a discount on the bond. For example, a $500 bond with a maturity of 5 years is being traded. After it reaches its maturity after 5 years, it may be worth $1000.

Forexpress | Four Years More – Obama

After a close fight with the former Massachusetts Governor, Barack Obama regained his position as the president of the United States. Yesterday afternoon, Mitt Romney gave up on his claim to the presidency in a concessionary speech which congratulated the president and called for the American citizens to unite and help one another.

“The nation as you know is at a critical point. At a time like this, we can't risk partisan bikering and political postering. Our leaders have to reach across the aisle to do the people's work and citizens also have to ride through the occasion.” Romney said.

The fights was outstandingly expensive which involves only a handful of swing states wherein the efforts are poured in. The president managed to win the majority of them such as New Hampshire, Michigan, New Mexico, Iowa, Virginia, Wisconsin, Colorado, Nevada, Pennsylvania, Minnesota and Ohio. Meanwhile Romney only North Carolina and Florida but the later is almost hanging by a cliff.

After Romney's speech and Obama was declared to have his second term, congratulatory statements from world leaders poured in. Many coming from fellow UN security councils and allies.

“I will continue to work with President Obama to ensure the vital security interest of Israel and United States,” said by Israeli Prime Minister Benjamin Netanhayu.

“ (As) a treaty ally and strategic partner of America, the Philippines looks forward to deepening the cooperation between the Philippines and the United States in Mr. Obama's second term,” as relayed on a statement coming from the Philippine president.

Obama will now face issues like whether the Bush tax cuts should expire and many other pressing concerns like tax hikes.

Inside Trade | Simple Moving Average

In one of the previous articles, I had mentioned about Moving average and its kind in general. Now in this article, we will go further down a bit by discussing the easiest form of them all, Simple moving average (SMA).

SMA shows the main movement of the price. The movement are plotted by subtracting the closing price of the current time-frame from the closing price of the previous time-frames which shows the average in a form of a curve line. It's main task is to even the price change, depicting a simpler view on the direction which it is currently tracking on a certain period of time.

Calculation

The calculation of SMA is done by summing up the closing prices of the instrument over a certain number of single periods then divided by the number of such periods.

SMA = SUM(CLOSE, N)/ N

N= is number periods.

Forexpress | Last Call to Victory – U.S. Presidential Election

After Sandy almost lay waste to U.S. northeast, its now time for the two presidentiables to deliver their final blow for the U.S. presidential campaign. As the polls are indicating, the battle between the two is a close one. An almost deadlock, Obama having a slight advantage, hoped to be resolved in the last days of the campaign by both parties. According to reports, even if the voters are not as enthusiastic to Obama compared to the election way back in 2008, he still has a slight leverage to win an another term.

But Romney isn't showing any signs of backing down even a little. Both sides are already quickening their pace to sway all remaining independent voters as they sweep to the remaining key states before handing the final verdict to its citizens. Polls had it that Obama lead 4 percent in Ohio which is one of the key to victory. He also took Virginia and Colorado in small leads but Romney owned Florida by 1 percent.

The outcome of the election, due on Tuesday, will determine America's next move in critical issues such as Iran's nuclear materials and its recovering economy.