Inside Trade | Basic Candlestick Patterns

The main concept of technical analysis is that the movement of the market repeats every now and then.

After being introduced to the types of charts, especially to the Japanese candlestick, a trader should already know that since the market repeat its movement, certain patterns may appear from time to time.

There are 12 major candlestick patterns: Doji, Gravestone and Dragonfly Doji,Long-legged Doji, Bullish Engulfing Pattern, Bearish Engulfing Pattern, Dark Cloud Cover, Piercing Pattern, Hammer and Hanging-man, Morning Star, and Evening Star.

Doji – displayed as a candle without a body, Doji denotes the indecisiveness of the investors. It means that it may mark an impending reversal if in case it appears on a long trend. Traders must preparer for a major trading decision.

Gravestone Doji and Dragonfly Doji – Both patterns are common before a trend reversal. The Dragonfly usually shows a “T” like candle who has a long lower shadow but has no body and upper shadow. Meanwhile, Gravestone is like an upside down “T” which looks like the reverse of the Dragonfly. It has no lower shadow and body but has a long upper shadow which made it look like an erected Japanese gravestone.

Long-legged Doji – this Doji may be compared to the common type but it only has a longer shadow. It indicates that even if the price movement shows a lot of trading activity, the next direction must still be confirmed.

Bullish Engulfing Pattern – this type of pattern is formed at the end of a bear trend. This chart pattern shows a small black candlestick followed by a large white candlestick, “engulfing” the smaller candle. This indicates that the bull had assumed control on the trend and overcoming the the selling pressure.

Bearish Engulfing Pattern – this is an opposite of the Bullish Engulfing Pattern and are formed at the end of a bull trend. It is displayed as a small white candlestick being overwhelmed by a large black candlestick and is showing that the bear had taken over.

Dark Cloud Cover – A pattern which involves a white candlestick being followed black candlestick. It may be a sign of a future bearish trend.

Piercing Pattern - it is a pattern which involves two candlesticks. The candlestick for the first day is black then followed by a white one on the next day. The opening of the white candlestick is way below the range of the candlestick for the previous day. It will then go up and will close above the half of the black candlestick. It signal the end of a small to moderate downtrend and also the time for traders to open a buy position or close their sell position.

Hammer and Hanging-man – the name of the candlestick depends on its color but has similar formation, a small body with a long lower shadow. A hanging man is a bearish candlestick formed at the end of a bull trend. Meanwhile, hammer is found at the end of a downtrend and indicates that although the bullish investors doesn't have the full control, the influence of the bull is getting stronger.

Morning Star – a bullish candlestick pattern consisting of three candle. The first candle is big black candle located on a downtrend. Meanwhile, next to it is a small white candlestick followed by another big white candle. This pattern denotes that the bearish trend will reverse.

Evening Star - the opposite of the Morning Star.

Venturing on InstaForex | Best Analyst Wins 45 Gran

The year long wait to announce this year's best analyst is finally over. Last November 30,2012, the Analyst of the Year award was concluded and three winners are proclaimed and awarded with the titles and prizes.

The one who claimed the first place this year is Yuriy Zaytsev from Russia. Meanwhile, Gerardo Narciso Palomino from Peru assumed the second place; and Stanislav Polyanskiy from Ukraine holds the third place. Each of them won a managed account worth $45,000.

Though the awarding is still new, it already garnered attention among Forex traders. Not only that, it also lifted the quality of analysis by allowing traders to compare the works of one another. The works which in time will forge the best. Like a tempered steel heated and beaten and hardened with cold water.

Inside Trade | Dissecting a Trader's mind – Dr. Alexander Elder

A great deal of different personalities are attracted in the world of finance. Some are really inclined from the very beginning, but there are those who are just sucked in but still manages to stand out despite unfamiliarity of the field.

Among those who stood tall was Dr. Alexander Elder. The famous financial figure was born in USSR but emigrated to the United States when he was still 23. He graduated from a medical school in his mother country but settled in the US to teach at Columbia University. At first glance, stock trading is really a far fetched career from medicine. Queer as some would say, and an extremely different path which seems to be outlandish when compared with one another. Despite the alienation from his original career path, it's hybrid composition bore to new heights. A combination which allowed him to penetrate the wits of his colleagues and use it to his advantage.

Dr. Elder, being a psychiatrist by profession, was bestowed with the ability to understand how the mind goes. He was immersed on the world of traders which gave him a first hand account and thus permitted him to really understand what's going on inside a trader's mind. His contribution to the industry was delivered through a distinction of traders according to their understanding of the behaviors on the market.

According to Dr. Elder, the three classification of traders are:

1. Traders who understands the concepts and details of Technical analysis but cannot decipher the traders' motives behind it.
   
   
2. Traders who realizes that the technical analysis will not suffice to ensure success.
   
   
3. Traders who understands that in order to be successful, control and money management are the key to victory rather than the statistics from the market.

Inside Trade | Trading on Christmas

As the birth of Christ is fast approaching and people are now too busy shopping for all the things that they needed in preparation for the much awaited event, Some questions might pop up to the fickle minds of newbie traders. If this will be your first Christmas as a trader, you may be wondering if the markets are open during this time of the year.

The answer is yes. But if in case you have plans to trade during the yuletide season, there are some point that you must take note of.

Brokers

Although most brokers allow trading during this time of the year, there may still be some who would stop its operation to enjoy and celebrate Christmas. No one can blame them since it's just normal for humans to stop working once in a while and enjoy life. Spending sometime with their children and relatives or escaping the cold breeze by taking a vacation in a warm island somewhere in the Asian region. If in case your broker's like that, maybe you should too. It won't hurt if you leave trading for a while and just come back tomorrow.

Movement

After successfully entering the market, your instincts may tell you that something isn't right. Something's unusual about the market. Guess what? You're right! During this season wherein most are not working, the economic activity slows down. If there isn't much economic activity, expect that the market movement would be limited.

Spread

Since the movement are limited and only a few are trading, you may get the idea that spread will increase. Why will it increase and how much? Due to the limited number of traders who are working, only a few may agree upon the value that they want to sell or buy the currency of the other party. Often because of this, the spread size becomes triple than the normal, making it really difficult for traders to catch a profit which is aside from the limited market movement.

So in the end, I am advising you to just spend your time with your love ones because even though you have the money that the world can offer, it cannot buy the time you traded with currency trading. Merry Xmas!

Inside Trade | I got 'ya partner! - Choosing the Right Broker

Nowadays, it's really hard to know who are trustworthy and who are not. Most especially that many are now living in a virtual world wherein you could become whoever you want to be. Claim to be a rich man even though your poor or pretend to be normal joe even if you're a millionaire in real life. My point is, it is quite hard to figure out which is which. What more if there are money at stake?

But that doesn't mean that you cannot hand out a little trust. You could still entrust your money to someone but just be sure that you're in good hands. Dishonest brokers are abundant in the net, wolves among sheep as they say. I cannot deny the existence of those ill intended brokers that are just pretending to be catering wonderful service but in reality only intends to steal your money. Good thing that there are some indications which gives a clue to separate the good ones from the rotten ones. Here are some of those clues to help you.

Communication

Honest brokers are always open for communication. They make themselves visible and reachable either on their support service or through their online and offline representatives. Forums usually have a section for traders to talk with the representative whenever they encounter a problem or have some complains regarding the services of that particular broker. If in case you can't see signs of their representatives, then better think twice before opening an account with them.

Representative Offices

Representative offices gives assurance to investors that this broker will most likely not run away with their money. It is also a sign of boldness from the broker that it is not afraid to show itself to the public. Aside from that, it also mean that their clients may at anytime go to their office and complain face to face.

Transparency

If you've got nothing to hide, why be afraid to show to your client what they needed to see. If a broker discloses a suspicious information then it may be a signal that something's not going right.

Right credentials

Credentials aren't only used as an ornament. It also gives security that other people recognizes the capability of the broker. If there is someone who could vouch for them, then it is a good sign that their are words are not weigh with air. like they, "words are still words until it is proven."

Venturing on InstaForex | Another Lotus

Last May, the Lotus Evora was bestowed to the winner of the Fast Ride from the Best Broker campaign. Traders were awed as the sports car was handed down to its new Malaysian owner. I bet some were dismayed and some are still hopeful for the sports car. Worry no more because if you missed the chance to grab one of those mouthwatering give away sports car then just try again your luck this year's Sports Lotus Is Your Trade Bonus campaign.

The campaign which raffles the elite sports cars from the British car producer – Lotus, and is now open to traders who has a live account with InstaForex. Traders must only deposit an amount of not less than $1000 to his/her account and register for the campaign. Meanwhile, InstaForex Club member is only required $500 deposit. The duration will be from June 25, 2012 up to June 25, 2014. So there's still plenty of time to join and participate in this wonderful campaign.

The winner of the campaign will be drawn using the same procedure used in the previous campaign. For the benefit of those who are still new to the campaign, a number is given to every participant of the campaign. The number is called Lotus Number which serves as their raffle ID. At the end of the campaign, a random number will be generated and will declare the winner of the brand new sports car.  

Inside Trade | Economic Calendar

Ever heard of the term “economic calendar”? If in case you haven't, allow me to inflict the idea. Economic calendar refers to a list of scheduled economic events and the time which it is expected to happen. It is a calendar of various economic activities which specifies the nature of the event and it's scheduled release or commencement.

For the benefit of everyone, most macroeconomic indicators has it's own release schedule which allow traders to predict it's effect on the market. The GDP, CPI, PPI, Inflation rate, etc. are just some of the macroeconomic factors that are released on a regular basis.

However, it's not only the economic indicator that you may include in your calendar. Huge issues, like Fiscal cliff or Euro crisis events, may also be included on your calendar. Though theses events may not be expected at the start of the year, some of it still have a definite schedule and may play a significant role to your analysis. Poll results which has a scheduled released may also be mentioned in here.