Premium
- New York
- London
- Barcelona
- Tokyo
- Sydney
Search
0
0
What Came First ... Fundamentals or the Technicals?
Thu, Jun 29 2006, 14:07 GMT
by Jared Martinez
I am honored to share my thoughts on our methodologies, focusing on the current technical movements and conditions of the FOREX Markets, i.e. USD traded against the major world currencies such as the EUR, JPY, GBP. Let me ask this question. In your opinion, what drives the markets first ... Fundamental conditions or technical movements?
I am sure you all have an opinion. Perhaps you have never even though about it. My belief is and what I have found that what works for me is the reliability of the technicals out performs the reliability of the fundamentals. Even though I strongly recommend, every trader must be aware of fundamental announcements, i.e. Governmental reports, Central bank decisions, interest rate changes etc. as best they can before they trade. My methodologies and rules for trading as well as risk management are based off of the technical movements (technical analysis) in the market.
If a trader wants to play this game and find long-term success, the best thing they could do for themselves is create a trading plan with a checklist of criteria for entry, and exiting positions. Creating a trading plan before entry plays a large part in avoiding emotional decisions and staying structured in your trading. After all, the worst time to check your fuel as a pilot is after the plane has taken off. The reason there are less accidents in the air, verses the ground, is due to well thought out flight plans by pilots, who create several alternative scenarios should things go wrong. I have come to the realization that, not only does Murphy's Law apply to trading in the markets, Murphy's primary residence is found in the trading charts. If any thing can and will go wrong, It will go wrong.
Trading is not a game of chance or luck. It is a solid means of creating income. It can be like playing a game of chess. At all times, there are several scenarios that can take place. The expected move of the market is usually not in the direction we thought and the out come is like playing chess with an expert. They have a habit of blindsiding you as you play with the out come of the game ending unfavorable and a lot earlier than you anticipated. Income comes to those who approach the market with knowledge and a serious level of disciplines. Safety and longevity in trading comes from properly educating yourself on how the markets work first and then knowing how to manage your risk.
Having said that let me get started with our approach in trading on the FOREX.
I don't care how you look at the market. It can only move up, down and sideways. The question is, on what time frame?
Every day the market is filled with traders who have different opinions of which way the market is moving. I have learned that one of the reasons they think and feel so differently is based on the charts and time frame they are looking at. A trader who looks at daily charts may think the market is trending up, while a trader who looks at a 60 minute chart may think the market is trending down. The fact is, they may both be right.
The question is, how are they both right? What were the signs or analysis that made them both right? It comes down to understanding technical analysis and whether your trading style is that of a day trader / scalper or long-term position trader. We have created a trading methodology that includes 4 major aspects of Technical Decision making:
- Candlestick Formations
- Fibonacci Corrections / Retracements and Extensions
- Financial Breakouts
- Trading in the direction of the trend using Trend lines
Published on Mon, Nov 27 2006, 16:29 GMT
Market Traders Institute
| 250 South Park Av. Suite 605, Winter Park, Florida, 32789
http://www.forextips.com/mtistaff.htm | sds@mtinorthamerica.com
Legal disclaimer and risk disclosure
High Risk Investment Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. Before deciding to trade foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts. Market Traders Institute Market Opinions Any opinions, news, research, analyses, prices, or other information contained on this website is provided as general market commentary, and does not constitute investment advice. Market Traders Institute, Inc."MTI" will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information. Accuracy of Information The content on this website is subject to change at any time without notice, and is provided for the sole purpose of assisting traders to make independent investment decisions. MTI has taken reasonable measures to ensure the accuracy of the information on the website, however, does not guarantee its accuracy, and will not accept liability for any loss or damage which may arise directly or indirectly from the content or your inability to access the website, for any delay in or failure of the transmission or the receipt of any instruction or notifications sent through this website. Distribution This site is not intended for distribution, or use by, any person in any country where such distribution or use would be contrary to local law or regulation. None of the services or investments referred to in this website are available to persons residing in any country where the provision of such services or investments would be contrary to local law or regulation. It is the responsibility of visitors to this website to ascertain the terms of and comply with any local law or regulation to which they are subject.Interested in forex trading? forex brokerage firms!
FXstreet.com will give you a 3 months membership as soon as minimum rebates have been generated (€150 for private trader/ €300 for corporate trader)
[Read Premium full description]
Opinions expressed at FXstreet.com are those of the individual authors and do not necessarily represent the opinion of FXstreet.com or its management.
Risk Disclosure: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.
©2008 "FXstreet.com. The Forex Market" All Rights Reserved.