In several posts the issue of luck and chance were touched on. There is a need to explore this further, as many who know little about financial trading believe it’s largely about luck and chance. Introduction It is important that words like luck and chance are defined here. Luck as a concept is outlined in the infographic below. A chance is a probability that is known or foreseeable. We separate luck and chance, though in many circlesRead More
Big disclaimer: The information provided herein is opinion only. Under no circumstances do any statements here represent a recommendation to buy or sell securities or make any kind of investment. You are responsible for your own due diligence. No investment advice, is provided nor are any claims or promises made that any information here will lead to a profit, loss, or any other result. All expressions are for educational purposes only. What is a derivative?Read More
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Demo or paper trading is very advantageous to new traders in learning much of the basics of financial trading. This site strongly recommends all new traders to blow up demo accounts of any size at least 5 times!! One of the issues with that, is that new traders may come to feel demoralised and then decide that they “can’t do this”. Well that could well be true. Note however, that nearly every successful trader hasRead More
This is a short one. Over the last 3 years I’ve come to appreciate – and more so in the last year – that the really big action is on the 4H time frame. Yes – for sure there is even bigger action on the daily (1D) time frame on lots of markets/charts. But 4H is where most of it happens. 4H is also a good time frame for new traders and seasoned traders –Read More
Stop-losses are very important to all new traders. In this post I look at it more deeply. The infographic below is about fixed targets which are relevant to most types of trading strategies. It is not very relevant to trend-following methods.
I’ve been stalking NZDCAD for some time. It is a most interesting and challenging currency pair. In August I was stalking NZDCAD for a short. At that time there was a weekly zone of resistance. Now here at the end of November, the picture has changed. Sound traders shift their mindsets as new information emerges. I’m long on NZDCAD, having contracted to lose a controlled amount (alias stop-loss). This means that I do not know whatRead More
For those who have been watching the US30 or the SPY or the DJI, there is some crazy stuff going on. The on the night of the Trump victory, the bears mauled the bulls – as you can see on chart below. The bulls rebelled within hours. The market rallied to a new high. But all is not well for the bulls. This could turn out to be a blood bath! I’m not predicting anything.Read More
Perspective is everything if you’re a day trader. You may know you’re in a winning situation from what’s happening on the charts. But what lies lurking for you? How can you spot the traps? It’s simple but not easy: change your perspective. The following composite graphic shows how a failure to change perspective could have hurt. [Click on image and then zoom in for a clearer view] DISCLAIMER: The information provided herein is opinion only.Read More
Hindsight is a wonderful thing. We can learn lessons but in doing so there is a risk of the coulda-shoulda-woulda phenomenon. The following charts show some interesting features in EURUSD. Any lessons there should be applied cautiously.