Category: Educational
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DAX v EURO correlation
Correlation is about how certain things are related. Some instruments are inversely correlated i.e. if price goes up on one, then price tends to go down on another. Positive correlation means they move in the same direction. It is almost never the case that there is perfect correlation between two instruments. Interestingly the DAX (GER30)…
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Support and resistance again!!
Today I came across another classic example of support and resistance. I often review things that I had already learned so as to etch in my brain the importance of the concepts. The chart below explains more.
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The two most important things in trading
It takes some time for the two most important things in trading to hit home. It’s easy to understand the words, but the meaning and importance come later. Limiting loss with sensible stop-losses is of the utmost priority. With a 60 – 80% loss rate which is not unusual, that’s where any profits made on…
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Williams Vix Fix on 2H charts
I’ve explored Williams Vix Fix on mainly 4H charts in the past. Over several weeks I’ve been looking at 2H charts to see if WVF works on these timeframes. My observations are that in some situations they can be valuable. Of course, WVF requires careful attention to detail and interpretation. In general only signals coming…
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Trend continuation and trend following
The terms ‘trend continuation’ and ‘trend following’ have caused me some confusion for quite some time until about 6 months ago. The first obvious difficulty is the use of the words themselves. It’s natural to think that if a trend is continuing then you must be following it. But the two techniques are rather different.…
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A big thumbs up for FormationSeeker!!
FormationSeeker is a revolutionary resource for all traders. Scott Carney, the renown brain behind discovery and development of some harmonic patterns has been a driving force at FormationSeeker. FormationSeeker runs web-based software that picks out harmonic patterns consistently, matching much of the knowledge, skill and experience of Scott. I first logged in for free on…
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Separating missions, strategies, methods and goals.
In trading circles many new and seasoned traders use the words (or similar): strategy, method, targets, goals. But what do they actually mean? How do they all fit together? How are they organised? (see mindmap below). In this post I take the concepts apart and put them back into some sense of organisation. Some have…
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Mindsets
Today I was chatting online with another trader and attempting to show an alternative way of taking a chunk out of the markets. You might think that there would be great interest in that. However, this trader said to me words to the effect that a new strategy meant a new mindset – and in…
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Synthesis
What do I mean by ‘synthesis’? It’s about putting things together. Jeeeez – is that such a big word? So the pic below represents the result of synthesis. Synthesis of what? The method of binary options and harmonic trading principles. Huh? With Binary Options you only need price to stay away from your entry point to make…
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Important books on Trading
In my post ‘Tools – not fools’, I left out books. At that time I had not read many good books on trading, so it was a terrible omission. I was preoccupied with learning from books that did mainly analyses of various sorts. I had focused less as most noobs do, on ‘trying to trade…