Something Interesting in Financial Video - page 20

[Sergey Golubev]

VIDEO LESSON - Price Action: Candlestick Indicators in Price Action Trading

Since candlestick and bar charts are the fundamental interface of the price action trader, the most basic unit is the candle or bar itself. Candles sum up the price action over a set period of time: on a 5 minute chart, each candle represents 5 minutes of price behavior, whereas on a daily chart, only one candle is produced per day. The body of the candle constitutes the range between the open price and close price, whereas the wicks or shadows of the candle indicate the high and low over that period of trading. Various color schemes are used to determine whether the price movement represented by the candle is bullish (increasing in price) or bearish (decreasing in price); bullish candles are usually white, blue, or green, whereas bearish candles are usually black or red.

• Longer candle bodies demonstrate strong momentum and decisive market behavior in the movement from open to close; longer shadows, however, demonstrate increased volatility, since some prices were reached during the time period but ultimately excluded from the range between open and close.
• Smaller candles can indicate the market's indecision, disinterest, or a balance between bullish and bearish forces.

A doji or small candle with a very long wick in one direction is referred to as a pin bar, which is often interpreted as a sign of potential trend reversal.

By contrast, a marabuzo candle has a large body, and almost no wick, implying that price action has been more definitive.

There are two important, rudimentary patterns that play out over at least 2 candlesticks:

• An outside bar is a bar with a higher high and a lower low than the previous candlestick, often with a body that also encompasses the price range of the previous bar's body; an alternative variation is the engulfing bar, which simply has a higher open and a higher close, regardless of the candle's shadows or wicks.
• By contrast, an inside bar is a bar, or series of bars, with a high and low encompassed by the preceding candle; in this case, the variation is the harami, a bar or series of bars with an open and close within the range of the bar preceding it.

[Sergey Golubev]

What is Price Action?

"A common beginner question to trading is what exactly is Price Action? Well, good question, let me sum it up for you."

Forum on trading, automated trading systems and testing trading strategies

Something Interesting to Read February 2014

newdigital, 2014.02.04 15:21

Trading Price Action Reversals : Al Brooks

detailed guide to profiting from trend reversals using the technical analysis of price action

The key to being a successful trader is finding a system that works and sticking with it. Author Al Brooks has done just that. By simplifying his trading system and trading only 5-minute price charts he's found a way to capture profits regardless of market direction or economic climate. His first book, Reading Price Charts Bar by Bar, offered an informative examination of his system, but it didn't allow him to get into the real nuts and bolts of the approach. Now, with this new series of books, Brooks takes you step by step through the entire process.

By breaking down his trading system into its simplest pieces: institutional piggybacking or trend trading, trading ranges, and transitions or reversals (the focus of this book), this three book series offers access to Brooks' successful methodology. Trading Price Action Reversals reveals the various types of reversals found in today's markets and then takes the time to discuss the specific characteristics of these reversals, so that you can use them in your everyday trading endeavors. While price action analysis works on all time frames, there are different techniques that you can use in trading intraday, daily, weekly and monthly charts. This, among many other issues, is also addressed throughout these pages.

• Offers insights on how to handle volatility and sharp reversals
• Covers the concept of using options when trading certain charts
• Examines how to deal with the emotions that come along with trading
  

Other books in the series include Trading Price Action Trends and Trading Price Action Trading Ranges

If you're looking to make the most of your time in today's markets the trading insights found in Trading Price Action Reversals will help you achieve this goal.

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Forum on trading, automated trading systems and testing trading strategies

Something Interesting to Read February 2014

newdigital, 2014.02.10 16:20

Trading Price Action Trading Ranges : Al Brooks

Divided into five comprehensive parts, Trading Price Action Trading Ranges skillfully addresses how to spot and profit from trading ranges—which most markets are in, most of the time—using the technical analysis of price action. Along the way, it touches on some of the most essential aspects of this approach, including:

• Trading breakouts, which are transitions from trading ranges to trends, and understanding the gaps they create
• The two types of "Magnets," Support and Resistance, and what they mean once the market breaks out and begins its move
• Pullbacks, which are transitions from trends to trading ranges
• The characteristics commonly found in trading ranges—areas of largely sideways price activity—and examples of how to trade them
• Honing your order and trade management skills so that you can make more informed entry and exit decisions
  

And much more

Throughout the book, Brooks focuses primarily on 5 minute candle charts—all of which are created with TradeStation—to illustrate basic principles, but also discusses daily and weekly charts. And since he trades more than just E-mini S&P 500 futures, Brooks also details how price action can be used as the basis for trading stocks, forex, Treasury Note futures, and options. For your convenience, a companion website, which can be found atwiley.com/go/tradingtrends, contains all of the charts provided in the book.

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Check the other book from this series : Trading Price Action Reversals : Al Brooks

[Sergey Golubev]

VIDEO LESSON - Fundamental Analysis and The US Economy

There are two ways that traders analyze the markets which are known as technical analysis and fundamental analysis.

While technical analysis focuses solely on the analysis of historical price action, fundamental analysis focuses on everything else including things such as the overall state of the economy, interest rates, production, earnings, and management. When analyzing a stock, currency or commodity using fundamental analysis there are two basic approaches one can use which are known as bottom up analysis and top down analysis. Bottom up analysis very simply means looking at the details such, as earnings if we are talking about a stock, first and then working one's way up to the larger picture by looking at things such as the industry of the company who's stock you are trading and then finally the overall economic picture. Top down analysis on the other hand means looking at the big picture things such as the economy first and then working one's way down to the details such as earnings if we are talking about a stock.

[Sergey Golubev]

Something about Fractals (with video) -

Forum on trading, automated trading systems and testing trading strategies

Indicators: Fractals

newdigital, 2013.12.16 11:23

The Fractal Indicator

The fractals are technical indicators, part of the Bill Williams’ indicators. Unlike any other indicators, this one is not a line or histogram bars; it is just a simple arrow on top of or below the bars of the price chart. These fractals are formed when five consecutive bars align in a strict manner. There are two types of fractals:

Bearish fractals: this fractal forms over a bar in the price chart, only if the high of this bar is higher than the high of the previous two and next two bars. In real-life trading this fractal indicates a possible bearish movement.

Bullish fractals: this fractal forms below a bar in the price chart, if the low of this bar is lower than the low of the previous two and next two bars. When you see this fractal, you should expect a bullish movement.

It is important to mention that the Bill Williams’ fractals are illustrated a bit late on the chart, because you need the fifth bar to close, in order to determine the highest high or lowest low. The fractals are trading signals, but they are far too insufficient to count on them alone: the buy fractal indicates a possible buy order and vice versa.

Use in Forex

The fractals point out the strong levels. You can easily draw a line to connect multiple fractals to form either a resistance or a support line. These levels work exactly the same as the trend lines. If you take a look at the image, you will see the resistance line and the buy signal. We get this signal, because the price breaks the strong resistance level. However, if you take a close look at the chart before this moment, you will see a couple of sell signals. This clearly points out how inconclusive are the fractals alone.

If you have paid attention on the Trend Lines page, you already know that some traders use the fractals to build their trend line. We really like this strategy, but it is not something revolutionary.

Bill Williams’ fractals and Alligator indicator. These two indicators share great synergy and we will take a quick glance in the image. It is the same as the previous, but we have added the Alligator and this changes the picture quite a lot. Take a look at the buy signal; do you see now why we have not opened a sell order before the buy signal? The price moved above the Alligator and we needed to see a breach of the indicator’s levels and a couple of sell fractals, but did not see that. Instead, the price kept on moving above the Alligator and it even broke the resistance level, which gave us a clear idea of the future movement – buy and take profit.

[Prosper Okorie]

This ATR Indication is the best for risk management. It has helped a lot of people.

[Sergey Golubev]

Forum on trading, automated trading systems and testing trading strategies

Press review

Sergey Golubev, 2016.06.30 08:08

How to Trade - Forex Leverage (based on the article)

Leverage in forex is expressed as ratios - for example as the following: 1:1, 1:50, 1:100, 1:200, 1:400.

Leverage in forex = Purchase Power/Capital Invested = $100,000/$1,000 = 100

This leverage ratio of 1:100 is translated as following:

For every $1 I deposit in my forex broker's account, my broker in return deposits $100 in my margin account. So, if I deposit $1000 then my broker deposits $100,000 in my trading account. So with just $1000 of my own money, I can control $100,000 for my trading purposes. By doing so I created a leverage in forex.

"Leverage has been in use from the early dawn of our civilization primarily to cope up with daily necessities. In the medieval era leverage was employed probably just to lift heavy stones to build houses. But in the modern era leverage has been used extensively in finance and commerce. When I am buying one million dollar house with only 10% down payment, I am essentially using leverage. Leverage adds glamor to forex trading. It is what makes so many traders gravitate to forex trading as compared to equities and other securities market."

"Hence, leverage in forex is the secret behind huge wind fall profits in forex trading. Be that as it may, leverage can magnify losses in losing trades. This is also why leverage is considered double edged sword. If I make winning trades using leverage then my profits are huge. Likewise if I make losing trades my losses are also huge."

[Sergey Golubev]

The author of this video is going to give everyone 10 questions here that you should now have the knowledge to answer. Ok so here we go:

1. If inflation is low and a Central Bank is concerned about recession, what would the expected monetary policy response be?
2. If inflation and growth are both high what would the expected monetary policy response be?
3. If a central bank raises interest rates, what affect if any is this expected to have on the currency of that country, all else being equal?
4. If a central bank lowers interest rates, what affect if any is this expected to have on the currency of that country, all else being equal?
5. If a country's imports grow and all other trade and capital flows remain equal, what affect would this have on the current account and what would be the expected affect on the currency if any?
6. If a country's exports grow and all other trade and capital flows remain equal, what affect would this have on the current account and what would be the expected affect on the currency if any?
7. If a country is a major exporter of gold and the price of gold moves up by 50% over the course of a year, what would be the expected affect if any on that country's currency all else being equal?
8. Japan is a major importer of oil and Canada is a major exporter of oil. If the price of oil goes up by 50% over the course of a year, then what affect if any should this have on the CAD/JPY currency pair all else being equal?
9. Traders who follow US Dollar fundamentals pay particular attention to any numbers which reflect the overall health of the consumer. Why?

10. The US Economy in the past was referred to as an Industrial Economy, now it is referred to more as a ________________ Economy.

[Sergey Golubev]

Good article with the video lessons -

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Video: How to setup MetaTrader 5 and MQL5 for simple automated trading

• Part 1 – Intro
• Part 2 – MetaTrader 5 Download
• Part 3 – More helpful content available
• Part 4 - What hardware do I need?
• Part 5 - How to install MetaTrader
• Part 6 - How to connect a Demo account
• Part 7 - How to adjust your chart settings
• Part 8 - How to adjust options for auto trading
• Part 9 - Your first automated backtest
• Part 10 - How to import an Expert Advisor

[Sergey Golubev]

Forum on trading, automated trading systems and testing trading strategies

Let's discuss video "Top 6 Algorithmic Trading Strategies!"

Automated-Trading, 2023.01.17 09:47

To help gain a much better understanding of quantitative trading, I want to give you an overview of all the different algorithmic trading strategies that exist. Besides improving your understanding, this should also help you decide what kind of algorithmic trading strategy you want to learn more about. Regardless, of your risk tolerance, preferred time frame, and favorite asset class, there is a strategy that is right for you.

[Sergey Golubev]

Evaluating Trading Strategies - Everything You Need to Know

In this video, you will learn everything you need to know about evaluating your (algorithmic) trading strategies, their performance, and more.