A Practical Guide to Swing Trading — Free eBook
September 10th, 2008Now you can download a completely free ebook on the swing trading from my site — it’s «A Practical Guide to Swing Trading» by Larry Swing. Although this book doesn’t deal with the Forex market specifically and was written with the stocks in mind, it still can be applied to the Forex trading, and I must say that even before I read it I’ve been using the strategy described in this book myself with currencies.
Swing trading as it described in this book is a trading where you enter a market in the main trend’s direction, but only after a significant pullback that is followed by a clear signal that the trend will continue occurs. Theoretically, it can be applied to both intraday and daily charts, but the author suggest holding positions for several days before realizing the profit.
Another good thing is that, while this ebook is quite long (74 pages), it reads very easy and fast. If you think that the swing trading is for you, download it.
EUR/USD Grows Little on Flat Pending Home Sales
September 9th, 2008EUR/USD traded today with a great deal of the intraday volatility — it managed to reach its almost two year minimum level at 1.4046 during the early Asian trading and post an upward spike later.After today’s portion of the U.S. macroeconomic statistics came out, the currency pair left its equilibrium point and rose a little. It is now trading close to 1.4126 level.
Pending home sales index fell 3.2% to 86.5 in July. This decline followed 5.8% increase in June (revised up from 5.3%). The estimated decline for July was at 1.3%.
Wholesale inventories continued to grow July — they gained 1.4% after 0.9% growth a month before. Average forecast for this indicator’s growth was 0.6%.
Microtrading with FXCM
September 7th, 2008FXCM broker entered the market with a new micro trading opportunity — FXCM Micro Forex broker. As many new traders prefer to trade with the small amounts of money, such brokers as FXCM can’t fulfill their needs. FXCM Micro looks like a really good opportunity for the low-budget traders. It offers $25 minimum account balance (with a maximum cap at $5,000) with 0.01 lots minimum for the position traded volume. Leverage is fixed at 1:400 level which is nice for the risky players with a little capital, but not many experienced traders would like tolerating the risk connected with such a leverage. 1.5 pips average spread on EUR/USD allows some really interesting short-term trading strategies.
Of course, it’s hardly a good broker choice for the professional traders or those who wish to start out with a big real account capital and a lower risk setting. Deposit and withdrawal can be done only via the credit card with this broker. Anyway, FXCM Micro is one of the few Forex brokers that offer micro Forex accounts and are regulated by the NFA.
Forex Technical Analysis for 09/08—09/12 Week
September 6th, 2008EUR/USD trend: sell.
GBP/USD trend: sell.
USD/JPY trend: hold.
EUR/JPY trend: hold.
| Floor Pivot Points | |||||||
|---|---|---|---|---|---|---|---|
| Pair | 3rd Sup | 2nd Sup | 1st Sup | Pivot | 1st Res | 2nd Res | 3rd Res |
| EUR/USD | 1.3541 | 1.3868 | 1.4068 | 1.4395 | 1.4595 | 1.4922 | 1.5122 |
| GBP/USD | 1.6854 | 1.7196 | 1.7430 | 1.7772 | 1.8006 | 1.8348 | 1.8582 |
| USD/JPY | 102.12 | 103.82 | 105.78 | 107.48 | 109.44 | 111.14 | 113.10 |
| EUR/JPY | 140.62 | 145.60 | 149.64 | 154.62 | 158.66 | 163.64 | 167.68 |
| Woodie’s Pivot Points | |||||
|---|---|---|---|---|---|
| Pair | 2nd Sup | 1st Sup | Pivot | 1st Res | 2nd Res |
| EUR/USD | 1.3836 | 1.4004 | 1.4363 | 1.4531 | 1.4890 |
| GBP/USD | 1.7196 | 1.7430 | 1.7772 | 1.8006 | 1.8348 |
| USD/JPY | 103.82 | 105.78 | 107.48 | 109.44 | 111.14 |
| EUR/JPY | 145.60 | 149.64 | 154.62 | 158.66 | 163.64 |
| Camarilla Pivot Points | ||||||||
|---|---|---|---|---|---|---|---|---|
| Pair | 4th Sup | 3rd Sup | 2nd Sup | 1st Sup | 1st Res | 2nd Res | 3rd Res | 4th Res |
| EUR/USD | 1.3977 | 1.4122 | 1.4170 | 1.4219 | 1.4315 | 1.4364 | 1.4412 | 1.4557 |
| GBP/USD | 1.7348 | 1.7507 | 1.7559 | 1.7612 | 1.7718 | 1.7771 | 1.7823 | 1.7982 |
| USD/JPY | 105.73 | 106.73 | 107.07 | 107.40 | 108.08 | 108.41 | 108.75 | 109.75 |
| EUR/JPY | 148.71 | 151.19 | 152.02 | 152.84 | 154.50 | 155.32 | 156.15 | 158.63 |
| Tom DeMark’s Pivot Points | ||||
|---|---|---|---|---|
| Pair | EUR/USD | GBP/USD | USD/JPY | EUR/JPY |
| Resistance | 1.4495 | 1.7889 | 108.46 | 156.64 |
| Support | 1.3968 | 1.7313 | 104.80 | 147.62 |
| Fibonacci Retracement Levels | ||||
|---|---|---|---|---|
| Pairs | EUR/USD | GBP/USD | USD/JPY | EUR/JPY |
| 100.0% | 1.4723 | 1.8113 | 109.18 | 159.61 |
| 61.8% | 1.4522 | 1.7893 | 107.78 | 156.16 |
| 50.0% | 1.4460 | 1.7825 | 107.35 | 155.10 |
| 38.2% | 1.4397 | 1.7757 | 106.92 | 154.04 |
| 23.6% | 1.4320 | 1.7673 | 106.38 | 152.72 |
| 0.0% | 1.4196 | 1.7537 | 105.52 | 150.59 |
Forex Technical Analysis for 09/01—09/05 Week
August 30th, 2008EUR/USD trend: sell.
GBP/USD trend: sell.
USD/JPY trend: hold.
EUR/JPY trend: sell.
| Floor Pivot Points | |||||||
|---|---|---|---|---|---|---|---|
| Pair | 3rd Sup | 2nd Sup | 1st Sup | Pivot | 1st Res | 2nd Res | 3rd Res |
| EUR/USD | 1.4322 | 1.4447 | 1.4562 | 1.4687 | 1.4802 | 1.4927 | 1.5042 |
| GBP/USD | 1.7390 | 1.7781 | 1.7996 | 1.8387 | 1.8602 | 1.8993 | 1.9208 |
| USD/JPY | 106.21 | 107.31 | 108.06 | 109.16 | 109.91 | 111.01 | 111.76 |
| EUR/JPY | 154.78 | 156.99 | 158.33 | 160.54 | 161.88 | 164.09 | 165.43 |
| Woodie’s Pivot Points | |||||
|---|---|---|---|---|---|
| Pair | 2nd Sup | 1st Sup | Pivot | 1st Res | 2nd Res |
| EUR/USD | 1.4445 | 1.4558 | 1.4685 | 1.4798 | 1.4925 |
| GBP/USD | 1.7781 | 1.7996 | 1.8387 | 1.8602 | 1.8993 |
| USD/JPY | 107.31 | 108.06 | 109.16 | 109.91 | 111.01 |
| EUR/JPY | 156.99 | 158.33 | 160.54 | 161.88 | 164.09 |
| Camarilla Pivot Points | ||||||||
|---|---|---|---|---|---|---|---|---|
| Pair | 4th Sup | 3rd Sup | 2nd Sup | 1st Sup | 1st Res | 2nd Res | 3rd Res | 4th Res |
| EUR/USD | 1.4546 | 1.4612 | 1.4634 | 1.4656 | 1.4700 | 1.4722 | 1.4744 | 1.4810 |
| GBP/USD | 1.7877 | 1.8043 | 1.8099 | 1.8154 | 1.8266 | 1.8321 | 1.8377 | 1.8543 |
| USD/JPY | 107.78 | 108.29 | 108.46 | 108.63 | 108.97 | 109.14 | 109.31 | 109.82 |
| EUR/JPY | 157.71 | 158.68 | 159.01 | 159.33 | 159.99 | 160.31 | 160.64 | 161.61 |
| Tom DeMark’s Pivot Points | ||||
|---|---|---|---|---|
| Pair | EUR/USD | GBP/USD | USD/JPY | EUR/JPY |
| Resistance | 1.4745 | 1.8549 | 110.46 | 162.99 |
| Support | 1.4505 | 1.8192 | 108.61 | 159.44 |
| Fibonacci Retracement Levels | ||||
|---|---|---|---|---|
| Pairs | EUR/USD | GBP/USD | USD/JPY | EUR/JPY |
| 100.0% | 1.4811 | 1.8779 | 110.27 | 162.76 |
| 61.8% | 1.4719 | 1.8548 | 109.56 | 161.40 |
| 50.0% | 1.4691 | 1.8476 | 109.35 | 160.99 |
| 38.2% | 1.4663 | 1.8404 | 109.13 | 160.57 |
| 23.6% | 1.4628 | 1.8316 | 108.86 | 160.05 |
| 0.0% | 1.4571 | 1.8173 | 108.42 | 159.21 |
Forex Technical Analysis for 08/25—08/29 Week
August 23rd, 2008EUR/USD trend: sell.
GBP/USD trend: sell.
USD/JPY trend: hold.
EUR/JPY trend: hold.
| Floor Pivot Points | |||||||
|---|---|---|---|---|---|---|---|
| Pair | 3rd Sup | 2nd Sup | 1st Sup | Pivot | 1st Res | 2nd Res | 3rd Res |
| EUR/USD | 1.4446 | 1.4561 | 1.4677 | 1.4792 | 1.4908 | 1.5023 | 1.5139 |
| GBP/USD | 1.8379 | 1.8442 | 1.8484 | 1.8547 | 1.8589 | 1.8652 | 1.8694 |
| USD/JPY | 106.28 | 107.20 | 108.63 | 109.55 | 110.98 | 111.90 | 113.33 |
| EUR/JPY | 158.08 | 159.13 | 160.98 | 162.03 | 163.88 | 164.93 | 166.78 |
| Woodie’s Pivot Points | |||||
|---|---|---|---|---|---|
| Pair | 2nd Sup | 1st Sup | Pivot | 1st Res | 2nd Res |
| EUR/USD | 1.4561 | 1.4677 | 1.4792 | 1.4908 | 1.5023 |
| GBP/USD | 1.8442 | 1.8484 | 1.8547 | 1.8589 | 1.8652 |
| USD/JPY | 107.20 | 108.63 | 109.55 | 110.98 | 111.90 |
| EUR/JPY | 159.13 | 160.98 | 162.03 | 163.88 | 164.93 |
| Camarilla Pivot Points | ||||||||
|---|---|---|---|---|---|---|---|---|
| Pair | 4th Sup | 3rd Sup | 2nd Sup | 1st Sup | 1st Res | 2nd Res | 3rd Res | 4th Res |
| EUR/USD | 1.4665 | 1.4728 | 1.4750 | 1.4771 | 1.4813 | 1.4834 | 1.4856 | 1.4919 |
| GBP/USD | 1.8468 | 1.8497 | 1.8507 | 1.8516 | 1.8536 | 1.8545 | 1.8555 | 1.8584 |
| USD/JPY | 108.76 | 109.40 | 109.62 | 109.83 | 110.27 | 110.48 | 110.70 | 111.34 |
| EUR/JPY | 161.23 | 162.02 | 162.29 | 162.55 | 163.09 | 163.35 | 163.62 | 164.42 |
| Tom DeMark’s Pivot Points | ||||
|---|---|---|---|---|
| Pair | EUR/USD | GBP/USD | USD/JPY | EUR/JPY |
| Resistance | 1.4990 | 1.8805 | 111.44 | 164.41 |
| Support | 1.4711 | 1.8516 | 109.09 | 161.51 |
| Fibonacci Retracement Levels | ||||
|---|---|---|---|---|
| Pairs | EUR/USD | GBP/USD | USD/JPY | EUR/JPY |
| 100.0% | 1.4908 | 1.8610 | 110.48 | 163.09 |
| 61.8% | 1.4820 | 1.8570 | 109.58 | 161.98 |
| 50.0% | 1.4793 | 1.8558 | 109.31 | 161.64 |
| 38.2% | 1.4765 | 1.8545 | 109.03 | 161.30 |
| 23.6% | 1.4732 | 1.8530 | 108.68 | 160.87 |
| 0.0% | 1.4677 | 1.8505 | 108.13 | 160.19 |
A Six-Part Study Guide to Market Profile — Free eBook
August 22nd, 2008Today I offer you a new free ebook to download from my site — A Six-Part Study Guide to Market Profile. Actually it’s not very new — it was written in 1996 by the Chicago Board of Trade professionals. It thoroughly explains the one of the most innovative but not too popular trading concept — the market profile. First it will help you understand what market profile is and how it can help in your trading. The good thing here that it doesn’t matter if you are a long-term or a short-term trader. And although it was written for the commodity traders, it can still be easily applied in the Forex market. Then it will teach you how to use the market profile to monitor both short-term and long-term trends. This book will also tell you how to relate the daily trading volume with market activity and benefit from it. Carrying out the actual trading decisions relying on the market profile data is described in the last two chapters of this ebook.
The only problem with this book is its size — it’s 346 pages long and it will take a while both to download and to read. Nevertheless, if you are interested in the concept of market profile it will be a helpful addition to your electronic library.
EUR/USD Rises above the Friday Open Level
August 21st, 2008Dollar declined today against the euro, allowing EUR/USD currency pair to rise above the last Friday’s open level. Currently it is trading near 1.4863 — 58 pips above Friday’s open. The decline was most probably caused by the investors’ concerns related to the U.S. financial market.
Initial jobless claims decreased from 445k to 432k last week in the United States — that’s below the median forecast 438k.
Leading indicators showed a more than expected declined posting a -0.7% change in July after 0.1% decline in June and 0.3% decline forecast for this month.
Philadelphia Fed index improved in August. It rose from -16.3 back in July to -12.7 this month. This growth exceeds the average estimate according to which the index should have risen to -13.4 only. Despite the growth it still remains at a very low negative level and is signaling a slowdown of the U.S. economy.
Statstical Forex System — Example MT4 Expert Advisor
August 20th, 2008After saying so much about the statistical Forex systems, I think it’s time to give an example of one. But first, I have to warn that this exert advisor «as is» wasn’t profitable during tests — it had its losses and gains, but spread losses took over eventually, so I can’t suggest using it on your real money account. This expert advisor is good only as an example of an actual statistical Forex system. It uses Tom DeMark’s pivot points calculated over the last 5 bars, which are then normalized by subtracting the current Open price. I used it on EUR/USD H1 chart, but I believe that it can be used on any other currency pair and timeframe. It consists of two .mq4 files:
The first file is StatGathererExample.mq4 — as it appears from its name, this MetaTrader EA will only gather statistics. Run it via strategy tester on a 1-2 year history period (it doesn’t have to be a good quality history, because it has nothing to do with price ticks, and uses just your OHLC data from bars; just be sure to have enough bars in your chart). This EA gathers statistics over a period of time and stores it to MapPath file («rl.txt» by default) in your /tester/files/ directory. Copy it to /experts/files/ for further use by the actual expert advisor.
And the second file is StatRunnerExample.mq4 — this EA is used for the actual trading and on-the-fly statistics gathering. This EA uses MapPath file («rl.txt» by default) from your /tester/files/ (for strategy tester) or /experts/files/ (for actual use) to get the initial statistics. It also continues to gather its own statistics and appends it to the initial file, saving it after deinitilizing.
You can freely use these examples to construct your own statistical Forex systems. I am also currently developing a statistical expert advisor that would be profitable and I promise to share it after the testing period.
EUR/USD Continues Falling on High PPI in U.S.
EUR/USD declined today for the fourth day as the producer price index was reported at a higher than expected level in the United States. Even the worsening of the housing market failed to press on the U.S. dollar today.
Building permits were at 937k in July down from 1,138k in June (revised up from 1,091k). They were expected to fall to 959k annual rate. There were 965k housing starts in July in U.S — down from 1,084k in June (revised up from 1,066k) and slightly above the forecast for July — 960k.
Producer price index (PPI) advanced 1.2% in July — below the 1.8% growth in June but twice as much as the average forecast of 0.6% for July.