by Scott Downing, BigTrends.com
This article is one that I’m asked to do over and over again…and that’s because so many people fail to focus! In the article I’ll give you some rock solid tips and methods to staying focused, and in my Forex Toolkit I’ll give you an indepth video on making the methods stick! Get my kit here, and enjoy the report!
What you probably don’t realize is that the “mind game” of Forex trading is just as important as having a proper trading system. This is why up to 95% of novice fx traders blow up their accounts. They make simple mistakes that cause a downward spiral of confidence. Or they let greed and fear push them into that one crucial decision that costs them all their profits (remember the big leverage that Forex gives you is a double-sided sword).
We’ve been successfully trading and educating traders at BigTrends.com for over 10 years and we know the proper mindset is extremely crucial to long-term trading success. One of the most important factors is to take the emotion out of your trading as much as possible. Logical, systematized, rule-based trading is a much better bet versus emotional trading and not having a plan.
By Chris Vermeulen, November 4th, 2010
With the election over and congress divided, it may be difficult for the president to get much done. None of this will take affect until the near year but traders are asking the big question… Will the government work together as a team or will it be a stalemate?
Today’s whipsaw action after the FOMC statement shook things up as it always does. We saw gold, silver, the dollar, SP500 and bond prices go haywire. It took about 30 minutes for the market to digest this news in that time a lot of people lost money because of the wide price swings. Trading around news, I find, is a net losing trade over the long run and I advise never to do it. Rather wait for a trend to form and trade any low risk setups that come your way.
I truly believe that the market has already priced in most news and events which unfold, and that news tends to agree with the overall trend of the market. Of course there will be short term blips on the charts from the news, but they tend to be minor setbacks in the underlying market trend. That being said, the trend is our friend, and while so many are trying to pick a top in the equities market it makes me cringe because they are fighting the trend and the Fed.
“PALO ALTO, Calif./WASHINGTON (Reuters) – Treasury Secretary Timothy Geithner vowed on Monday that the United States would not devalue the dollar for export advantage, saying no country could weaken its” -> Full Article on Reuters
…but U.S. will indirectly use other central banks and monetary policy to devalue the dollar. Planet earth is all in this together!
A big news this Tuesday night (here in CA) and Wednesday morning elsewhere in the world, the Bank of Japan directly intervened in the currency markets, selling Yen to stop the Yen’s rise that’s hurting their trade and thus economic recovery. Reuters said:
” The dollar extended its gains after intermittent yen selling and was up 2 percent on the day and nearly two yen above a 15-year low. But it was unclear whether Prime Minister Naoto Kan’s government had the stomach for a prolonged campaign similar to Japan’s last foray into foreign exchange markets in 2003-2004.
Finance Minister Yoshihiko Noda confirmed the intervention, saying Tokyo was also communicating with authorities overseas but indicating that Japan acted alone.
U.S. officials at the Federal Reserve and the Treasury declined to comment immediately about Tokyo’s action.
Noda would not say whether the authorities were buying dollars in the first intervention since March 2004, but two traders said the Bank of Japan appeared to have bought dollars around 83 yen at the start of the action.
The Bank of Japan acts on behalf of the Ministry of Finance in currency intervention.
“We will take decisive steps if necessary, including intervention, while continuing to closely watch currency market moves from now on,” Noda told reporters at a hastily arranged news conference.
The dollar had hit a 15-year-low at 82.87 yen earlier in the day but was at 84.78 yen by noon.
Prime Minister Naoto Kan’s government has been trying to talk down the yen but until Wednesday had stopped short of intervening in the markets, apparently worried that acting without Group of Seven partners would not be very effective. “
This is bound to cause big waves in trading around the world on Wednesday. Raymond Anselmo, aka @RiskCap on twitter & Forex moderator on Hamzei Analytics’ HFT, tweeted this chart of the USD/JPY currency pair (and that is why traders should always use stops! talk about in-your-face-ness…):