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Learningforex

Pattern and Structure This image provides a visual guide to key chart patterns and market structures in Forex trading. It emphasizes the importance of understanding how these patterns form and how price action influences market movements. The chart showcases several common patterns: 1. Bearish Channel: Traders are advised to buy at the retest after a breakout from the channel. 2. Double Bottom: This reversal pattern suggests buying after the confirmation of the second bottom or the breakout. 3. Rising Wedge: A bearish continuation pattern where selling is recommended after a breakout. 4. Flag Pattern: This continuation pattern typically occurs after a strong price move. The image suggests buying after the breakout. 5. Inverted Head and Shoulders (H&S): A reversal pattern signaling a potential bullish move, with a buying opportunity after the breakout. 6. Symmetrical Triangle: This pattern can break either way, but the focus is on buying at the retest after an upward breakout. The psychological level plays a significant role, as it represents critical zones where market sentiment often shifts. The chart encourages re-entry after successful retests in bullish patterns. This comprehensive structure helps traders enhance their technical analysis skills and make informed decisions.
Education
by unichartz
Fundamental Analysis in Forex In forex trading, fundamental analysis looks at the outlook of a whole economy to determine the actual value of a currency. The value is then compared with the value of other currencies to assess whether it will strengthen or weaken relative to those currencies. This post will further discuss how fundamental analysis is used in forex, what to look out for, and how you can incorporate it into your trading. What is Fundamental Analysis? Fundamental analysis is a way of looking at the forex market by analysing economic, social, and political forces that may affect currency prices. The idea behind this type of analysis is that if a country’s current or future economic outlook is good, its currency should strengthen due to an increase in demand for that specific currency. The better shape a country’s economy is in, the more attractive it is, which will lead to foreign businesses and investors investing in that country. This results in the need to purchase that country’s currency to obtain those assets. There are a multitude of factors that determine the intrinsic value of a country’s currency. Factors covering a whole range of economic data, social trends, and political developments come together to generate a broad view of the outlook for the country. This will subsequently drive the outlook for the currency. Due to this, forex fundamental analysis allows traders and speculators to take a longer-term view of whether the current value of a currency will likely increase or decrease towards its actual worth. Fundamental Analysis Information So, what information is used in the fundamental analysis of forex markets? There are several fundamental factors and components that analysts use to value a currency. From an economic perspective, the most important data are interest rates, inflation, economic growth, homes, and employment. Central banks and governments will use all of this information to formulate their monetary policy and fiscal policy, respectively. Changes to interest rates will impact the outlook that fundamental analysts have on a currency. As such, central bank policy decisions and governments' fiscal policy decisions are critical factors in the valuation of a currency. (More on this later.) Key Fundamental Data Let’s go into further detail on some of the most important fundamental data and how they impact the valuation of a currency: Interest rates Interest rates are a tool that central banks use to control an economy. Depending on how a country's economy is performing, central banks will adjust the general interest rate level to bring the economy back towards its respective targeted levels. When the level of one country’s interest rates is compared to another, this is a driver of the relative attractions of the currencies. A higher interest rate level will generate a better return for the holder of assets in that currency since higher interest rates draw capital from around the world as money seeks a higher rate of return, thereby increasing the demand for the currency as foreigners convert their domestic currency into the investment. Thus, the currency will strengthen relative to the other currency. Additionally, government bond yields are an indicator of the market’s outlook for central bank interest rates. Bonds pay a fixed income, so fluctuations in a bond’s price will determine its yield. If a central bank raises the interest rate, traders can get a better return on their money at the bank; therefore, the fixed-income government bond will likely be sold. So, if yields reflect the expectation of interest rate moves, fundamental analysts can compare the government bond yields of various countries to assess the relative valuation of the currencies. That is why fundamental analysts will look at interest rate differentials in their valuation to determine whether a currency is mispriced. Inflation Inflation is caused by an excess supply of money in a country's economy. This then leads to more spending, which then leads to an increase in prices. If the inflation rate is higher in one country than in another, then the relative value of its currency will decline. It is possible for inflation to get completely out of control, and in fact, there are some countries that print so much money that their currency becomes almost worthless as money. Because money has such an important function in all societies, people will often find substitutes when the domestic currency becomes worthless—even using the currency of another country, in what is also known as 'dollarization.' Inflation is a crucial driver of central bank interest rates. High levels of inflation eat away at the underlying value of an individual's assets or even savings. Furthermore, if inflation is too low or negative (deflation), it will lead people not to currently spend, and this can cause a downward economic spiral. Why would people buy something today if they think it will be cheaper tomorrow? Every month, inflation measures such as the Consumer Price Index (CPI) and Purchasing Price Index (PPI) are assessed by traders and speculators to judge a country's inflation outlook. Central banks use inflation targeting as they set interest rates. Higher inflation levels require higher interest rates to prevent continued price rises. Therefore, if one country has a higher level of inflation, it is likely that the interest rate will also need to be higher, which will also impact the currency’s value. Gross Domestic Product Economic growth is measured almost universally by changes in Gross Domestic Product (GDP). Gross domestic product is a measure of the size and health of a country’s economy over a period of time (usually measured quarterly or yearly). It is also used to compare the size of different economies at different points in time. GDP is the most commonly used measure for the size of an economy. The GDP is the total of all value added created in an economy. Value added means the value of goods and services that have been produced minus the value of the goods and services needed to produce them. The biggest drivers for GDP calculation are: Consumer spending: Also known as personal consumption expenditures, this is the measure of spending on goods and services by consumers. Government spending: It’s everything that is spent from a government’s budget within a public sector on items such as education, healthcare, defence, and more, depending on the country. Business investment: Any spending by private businesses and nonprofit companies on assets to produce goods and services is considered business investment. Balance of trade: The difference in value between a country’s imports and exports is what constitutes the balance of trade. If exports exceed imports, the country is in a trade surplus. On the contrary, if imports exceed exports, it’s a trade deficit. Homes The data on homes is very important due to the sole reason that one of the main aims for most people in life is to own a home. Additionally, a home is most likely the most expensive item a person will ever buy. So most people will work hard for a large part of their lives to own one. Because of this, housing forms an important part of the worldwide GDP calculation, so if a country's housing data is strong, this tends to also show in the country's economic performance. The biggest drivers in housing data are: Pending home sales: This number shows the number of home sales where a contract between the seller and the buyer has been signed. Existing home sales: This number measures the number and value of transactions of existing homes that were sold in a given month. New home sales: This number measures the new homes that were sold in a given month. In a strong economy, the number of new home sales tends to keep rising. Employment A country's employment rate is very important in gauging a country's economic strength. The reason is that employment is very important to a country's economic output. If people have jobs, they will spend money and contribute to economic growth. If employment is low, companies will have a shortage of workers. This will lead to lower productivity and then lower company revenues, which will then lead to companies not being able to pay back loans and even fewer jobs being available because companies can no longer sustain themselves. Also, consumer spending will decrease, and the never-ending cycle continues. The US Nonfarm Payroll employment figure is one of the most important figures that comes out on the first Friday of every month. The figure is an estimate of the number of payroll jobs at all nonfarm businesses and government agencies, the average number of hours worked per week, and the average hourly and weekly earnings. Because labour is an important economic factor of production, the unemployment rate is a good indicator of how closely economic output is to potential output, which measures economic efficiency. A falling unemployment rate is a good indicator of economic growth, while an increasing unemployment rate indicates economic decline. Fiscal and Monetary Policy Monetary policy is very important in fundamental analysis. Central banks vary in philosophy and economic stance; some central banks are 'hawkish, meaning that they prefer higher interest rates to encourage saving and investing, whereas others are 'dovish, meaning that they prefer lower interest rates to encourage consumer spending and borrowing. Economic data can help a central bank formulate its monetary policy, but there is another aspect to consider. Fiscal policy (government spending and taxation) is also relevant to the fundamental economic outlook of a country. While governments and central banks tend to be independent, they are not mutually exclusive. The fiscal actions of a government can have implications for the central bank (for example, the response of the Bank of England to the unfunded spending cuts of the UK Government in September 2022). Therefore, politics are also important. The type of government ruling a country can affect its economic outlook and, more importantly, its perception of future prospects for the country’s economy. A government that favours high spending might be seen as fiscally irresponsible. However, if the view is that this will generate more growth and a larger economy, it might be viewed positively. How fundamental analysis is used in forex trading Fundamental analysis is widely used to generate potential bull and bear markets in forex trading. Technical analysts will discuss trends; however, the medium- and longer-term fundamental outlook mostly, if not all of the time, generates the source of those trends. Fundamental traders will generally position themselves according to where they see a big trend. There might be some near-term fluctuations within the trend that can be taken advantage of using technical analysis. However, broadly speaking, a currency will move in a particular direction due to an economy’s longer-term prospects and interest rates. How traders perceive fundamental economic data is very important. On a longer-term basis, it is all about what the data means for the future outlook of the country's economy. Is a central bank on a path of raising or tightening interest rates? Does a country's government have to raise or cut taxes? Is consumer borrowing and spending too high? For short-term trading, it is all about expectations. Day traders usually look at the economic data for their signals. How did the data perform relative to market expectations? Did it beat the consensus forecast? Fundamental traders will examine how data announcements compare to the market’s estimates. Better-than-expected data should drive a stronger currency; if the data is less than expected, it tends to lower its value. Dangers when trading using fundamental analysis Though fundamental analysis can be useful in predicting the direction of currency prices, there are dangers that you need to be aware of. First, important figures like the nonfarm payroll and interest rate announcements are extremely volatile and can wipe your account instantly if you end up on the wrong side of the market. Additionally, there are times when markets are 'priced in', meaning that the move has already happened in anticipation before the fundamental data or announcement; therefore, the market is already priced in, and the market tends to go the opposite way. For example, if traders have been strongly anticipating that a country's central bank will cut interest rates, they will short the markets all the way prior to the central bank actually confirming the interest rate cut, so now the market is priced in and the market will tend to go the other way due to those traders exiting their early short positions. Forex fundamental analysis can sometimes be very complex and time-consuming. However, a general understanding of its principles will not only help you in your journey to finding consistency in the markets but will also improve your economic knowledge and awareness. BluetonaFX   
Education
by BluetonaFX
2
Support and Resistance is the name of the gameHi all, below is an article that I learned years ago and that has contributed massively to my trading success over the years and I would like to share with you. Due to the rules at tradingview, I cannot post the link so I will write it here. When it comes to trading support and resistance is the name of the game and support and resistance comes right off the chart. Name any indicator you can imagine, any concept of data crunching you think of, they all use the Open, High, Low, or Close from whatever time frame they are analyzing. In short, they get their data from the chart. Every indicator, algorithm, volume analysis, Market Profile, or Fib level, all seek to do the same thing, “FIND SUPPORT OR RESISTANCE”! Moving averages, traders try to use them for support and resistance. Bollinger bands, Keltner Channels, MA Envelopes, they use them to try to find support and resistance. No matter what, all methods ultimately seek to find the support or resistance from which traders will enter, manage, and exit their trades. Contrary to popular belief, indicators, if used correctly, DO NOT identify support or resistance. Indicators DO NOT time your trades. Indicators if used correctly are “TRADE FILTERS”. They merely give us permission to buy or sell support or resistance once WE have identified it, not a piece of software. It does not matter what you put on the bottom of your chart if you don’t know how to read the top half of the chart you will not make it in this business. That is our focus and that is what we teach, how to correctly get a “READ” on the market by understanding how Market Structure works. Key Points: All trading is about support and resistance: Indicators DO NOT identify support or resistance or time your trades. The majority of traders use indicators to find support or resistance, the majority of traders lose Indicator do not identify support or resistance, they are merely trade filters If you don’t know how to properly read the top half of the chart, then it does not matter what you put at the bottom of the chart. Trading at its basic essence is about knowing with a high probability where buyers are most likely to come in so we can buy, or where sellers are most likely to come in so we can sell, with a level of confidence that the trade will produce some form of profits while we manage our trades to longer term targets. If you don’t know how to spot support or resistance, how will you know when the market is testing it? If you don’t know where the market is most likely to go, how will you know when it gets there? How will you know where the best exit is in real time? Therefore, every day when you check the market opening. Do not ask yourself if you could trade today. Ask yourself if you could find support and resistance today. Remember, BUY AT SUPPORT & SELL AT RESISTANCE.
OANDA:XAUUSDEducation
by UnknownUnicorn25937650
EURJPYAs I said last weeks...exactly as I said, EJ closed above 129700 and has already made 70 pips! Even if EJ will test the 130,600 area again, I will continue to bet on SELL because the 1-month candle closed under a very strong resistance from 130,100. THIS WEEK...EJ makes a dangerous range in this area! Even if I still bet on SELL because on the 1 month chart EJ is overbought and formed W but only up to area 128700-128200 where I think EJ will force the climb back to 132,600 which is the Fibonacci level 786! however ... a close even for 4 hours over 130,700 will force me to think of BUY at least 200 pips! Please, give a LIKE if you find this idea useful! GREAT ATTENTION: Our analyzes have an accuracy of over 91% but due to market manipulations during this period we will avoid putting exact values on SL! We also recommend avoiding short-term trades during this period because news can appear at any time that can destabilize the market. *This information is not a Financial Advice.
by BloomFX_SIGNALS
Why most people fail as retail traders?I see two main reasons which complement each other for the high rate of failure. First and foremost, the media and the industry promote this idea that it’s easy to become a profitable trader and anybody can go it. This is, of course, not true. Theoretically, anybody can do it if willing to put the effort and approach it as a business. Practically almost nobody approaches trading with the same rigorousness as any other professional endeavor. Let’s put aside the first reason, about which there is not much we can do. A big chunk of the industry relies on peoples being naive and we’re not going to change that. On top of the first reason, we have a second reason related to people themselves. Most of those who try trading financial markets simply don’t manage their emotions and risk well enough to survive the learning curve. Managing your own emotions turns out to be a complex endeavor and constantly changing market conditions lengthen the learning curve. One of the things that makes this business so attractive is also the main thing that makes it so difficult to master. The direct and sometimes violent feedback you receive from the market, after each trading decision, has an astonishing impact on a human’s ability to keep his psychological well being in check and control his own reactions. It has the potential to disrupt executive functions and trigger instinctual “fight or flight” responses. This leads to emotional trading or trading on tilt which quickly generates more losses than any other mistake you could make in this business. Most other jobs have a protective buffer zone between usual day to day work decisions and the ultimate feedback — end of the month paycheck. This profession doesn’t. Every little call you make has an immediate impact on your capital. Every little mistake can take a portion of your capital away and every good decision can bring it all back and more. This kind of psychological exposure is heavily distressful and being aware of its mechanisms makes a huge difference. So … psychology differentiates the pro. Don’t get me wrong … professional discretionary traders are not emotionless but are much more aware and in control of their reactions. The successful pro deeply understands that trading is mainly about people's perceptions and the rest are just details. You may ask yourself how can such a level be reached? A starting point is to stay away from any market, financial instrument, time frame, trading technique, or any combination of those that doesn’t fit who you are deep inside. The least the exposure to triggers that can awake the demons within, the best. Always seek strategies that you understand and match your inner self. For example … if you are impatient trade shorter time frames, if you are very risk-averse don’t use huge margin, if you are risk-averse but you don’t have enough capital use margin with a tight risk management (maybe options), if you have a statistical mind try quantitative approaches etc. There are infinite possibilities to adapt to yourself and is a must to do it if you want to have a chance. It always amuses me to see the vast majority of educational resources geared towards what market does when most of the success in this business is knowing how you adapt to the market, whatever it may do. And, of course, the market is, more or less, the other traders.
COINBASE:BTCUSDEducation
by Mihai_Iacob
1
Possible Long Entry on EURGBP List of confirmations: 1. Price has broken through the weekly downwards trend line. 2. Price reversed at my dynamic support and resistance level. 3. A strong bullish engulfing candle was presented on the weekly time frame. 4. Price is above my 14 EMA on the daily chart which means that price has formed a new bullish trend. 5. Price has been forming higher highs and higher lows. *Do keep in mind that there is a strong presence of bullish divergence on the 4H time frame but we have to wait for price to reach my other S/R level in order to see if price bounces from it to confirm my price action analysis.
Long
by KhoaKDoan
NZDUSD trade idea Thought I’d poss up some Forex trading snacks! The NZDUSD is coming into a short term risk reward zone and up against a falling channel trend line. I see this as an opportunity to short some mainly because the price action is heading into multiple technical resistance zones and the back story is one of one of the most dovish central banks VS one central bank that is reluctantly becoming dovish. Also set into the mix, with a risk off stance currently entering the markets—the stronger of the two currencies is the USD just on it’s safe haven status. On this 4 hour chart you can see the falling channel and current price action hovering around the upper channel around 0.6450 Using the last daily high price around 0.6470 as a stop zone, which is also above the falling trend line for some more possible added resistance. The pair would need to break what has been a stronger trend of late to invalidate this setup. My target for entry is 0.6440-50 , my targets would be the recent years low around 0.6300-50 Recap; short trade entry 0.6440-50 Stop. 0.6470 Total risk. 20-30 pips Target 0.6300-50 or 100-150 pips Risk reward Better then 1-3 Trade idea is only for education and training. Should you trade any idea the assumption of risk is all yours. In trading you either make dust or you eat dust. Plan your trade and trade you own plan. All the best
Short
by PipsTradingClub