Saturday, December 21, 2013

Time frames to use when trading

What time frames to use when trading stocks or forex markets Traders need to take into account their risk and rewards is selecting a time frame. You need to know how to set your stops and take profit in the different time frames you are trading. If the trend is moving and the buyers are active and you place a trade then you need to set your stop outside of the time frame. This will make sure you are protecting your money. It is important to know where to place your stop and leave it.
  The same type of trading applies whether you are long or short the position. Especially if there is a strong trend in place. Make sure you have researched the entry and exits of the trade. If the trade seems more risky you can reduce the amount you are trading. If you are trading stocks you can look for a cheaper stock because they often trade in smaller time frames. Keep your stops close to the support and resistance levels when making a riskier trade.
  New traders need to learn this since they think it is nothing but easy money to be made. Traders need to keep losses to a minimum and let their winning trades run, using a trailing stop. New traders have a common problem of fear and greed. Their are in desperate need to make profitable trades all the time, so the new trader fails to understand that it is a must to control losses all the time when in a trade and make the most of things when the trade is in the money
Trading time frames

How to trade commodity futures

How to trade commodity futures options trading course ETF, Exchange Traded Fund
Traders know that Commodity ETFs started trading around five years ago. Traders can trade these just like you would a equities. Today these funds are traded on security exchanges, New York Stock Exchange, American Stock Exchange. The majority of investors and traders already stock trading accounts with brokers. Your comfort level is increased since you are already familiar with your trading charts and platform.  Commodities are raw materials that will make their way into the economy and will react much sooner than the stock market. Look at building materials. Copper and Lumber markets will move up after February since home construction and wood manufacturing and products like electrical wire, copper pipes, building materials for new home construction. This
should create some great trading opportunities in the future. Traders that are looking for a pure commodity play, then you should consider an ETF that invests in just the Futures markets.
The energy markets consists of Crude Oil, Gasoline, Heating Oil and Natural Gas. These exchange traded funds  can become just like a news stock when the commodity is in the news. When oil was heading to the upper $140 range, the reporters could not stop talking about oil. Many traders got into this rise in Oil prices by participating in oil ETF's.  A trader needs to apply good risk management of their trading capitol to survival, even with ETFs.
 ETF Futures Trading

Wednesday, December 18, 2013

Learning to trade

 This is why it is so important to keep trading records so you can learn from your trades this will increase your chances of making money on a trade. You want to build on our success and stay away from trades in which you have not followed your plan. Weekly points Number of points for the day or week Return on investment did you win or lose Percentage of  profit for the week
The amount of commissions There are numerous columns you can create to gain important information about you and your trading. The key is to document every item that affects you while trading. Once you have collected this data on a regular basis, you will start to see patterns in your trading that are either helpful or need your attention to correct. When you start a Trading Journal you will ask yourself how you ever got along without it in the past. This may seem like a lot of extra work but remember, your competition most likely is trading out of boredom thinking that the trades are going to give them something. You should know that whatever you take from the markets is from hard work over the other traders.

You can use the Fibonacci tool

Knowing  how to read the charts will make you money. Placing a short or long trade after a weak bounce in a currency pair is something you need to learn.
 When you have a good trend either up or down look for a re-tracement for a possible trade entry.
 It looks like EUR/USD bottomed out after hitting 1.3600 and it may be re-tracement time. Another short opportunity? The same is true if the trend is up you can make a long trade after a weak re-tracement. Remember you need to have a good trend in place.Study the forex chart below and you will see this same pattern develop when you have a established trend.
Forex traders need to recognize this chart technical setup that is breaking the original trend. The pair is in a downtrend on the four hour chart and many times if you are day trading you will see this on a 5 minute chart. and because it looks like it is retracing, You can use the Fibonacci tool to find potential resistance points. It looks like the price between 1.3750 to 1.3850 may be a great area for a possible trade, and depending on price action and volume. You could make a trade in this area on the chart. It looks like traders could push up the market to that area as stochastics show the pair is just coming out of an oversold environment.  The forex news from the U.S. is that 9.7% unemployment rate may be attributed to those who were looking for jobs have stopped looking, thus decreasing the labor pool. Any economic news can effect the forex market and change the trend. If you are day trading make sure to check the trend on the 15 or 30 minute charts.
  The U.S. jobs picture looks confusing at the moment, but potentially worse after the previous month reports. If it doesn't start picking up you can look for traders behavior to continue to pick up, and that may pose well for the USD.

Monday, December 16, 2013

How to use Moving Averages

How to use Moving Averages in stock and forex trading
Moving Averages can be used as a trend indicator especially in the forex market. Some traders that know how to read charts will use the moving average to confirm support and resistance levels. This can include using moving average crosses for buy and sell points. To start out you can set your MA's at wma 5 and wma 20 on your charts.
  These are widely used moving averages on both the stock trading and forex charts. Traders who use a Moving Averages as a trend filter will buy when the trend is moving up or down. When watching this chart indicator you can look for the price action to consolidate at the top or bottom of the MA. You need to remember that the MA's are lagging on the chart. This means they don't move until the price does or when a candle closes. This also depends on what time frame your charts are set at.
Many forex traders will use the 200 day moving average as a support and resistance area. One thing to remember if the price is near the 200 MA you should wait for confirmation before you decide to hit the buy or sell button. Waiting for the trend direction off the 200 MA will increase your chances of making a profit on the trade.

Positive trading mental attitude

 Having a positive trading mental attitude will create more profitable trades. Research your trades before you make them  is all part of the process. You need to have a clear vision of what your are trading and keep as much emotion out of the situation as possible. Generally the markets are against you from the start. The more research you can do will help even out the risk of loss and turn it into profits. The fact that you are trading real money always can interfere with the trades and that is problem that some traders must deal with. In my experience in trading Forex and helping new traders, that the greatest cause of losses is not having self-discipline. Traders need self-discipline to follow your trade plan; to be patient  to take losses.and profits and  to practice good money management.
  No matter what markets you decide to trade you need to learn to trade consistently making more better trades than bad, and the results will be more money in your trading account. The time involved to do this is really up to you but all successful traders never stop learning and adjust their trading to meet the current situations.

Saturday, December 14, 2013

Trading futures or option trading

Trading futures or option trading can wear you down emotionally you need to stay focused
  There is definitely risk involved when trading futures. Futures and option traders need to be able to handle the risk money wise and emotionally. This type of trading can cost you big time if you are not prepared for the trade. When you begin your trading day you need to be focused and prepared. Traders need to be ready to make trading decisions whether they are good or bad for your trading account. Trading out of fear of losing is not good you must have a positive attitude when it come to any type of trading. This is where a solid trading plan comes into play.  You could easily get caught in the wild swings in the market and place losing trades.  Trades without focus and a trading plan will fail. This will lead to more emotional trading which will cost you much more in the long run. News events can happen which will effect your trade so you need to be prepared for this to happen. You need to stay focused and accept that this will happen and can cost you some money.