Year: 2019

Forex trading styles

4 min read

the image is taken from www.babypips.com/

Trading in the Forex market recognizes and classifies different trading styles.

What typically separates the Forex trading styles is the length of time you intend to be in a trade, the timing of your entry. Also, in some cases, the frequency of the trades. When you trade it is very important to recognize different Forex trading styles.

Precisely because of the fact that there is a wide field of choice of tactics and strategies for trading and analysis of the currency market.

Long-term development and improvement of basic and complex trading methods, certainly, resulted in the creation of many highly productive trading strategies. That further created styles and trader tactics.

However, any attempt to find a unique trading style or a universal technical indicator for establishing a winning form is a completely wrong approach to the trading methodology itself.

Building own Forex trading styles

Building your own style of an individual finds its structural elements in the fundamental study of economic and technical factors. As well as the skills of recognizing patterns, by understanding the methodology of each of the styles that are widely known and recognized in the Forex market.

Talking about the success of trading on the Forex market, for the special reason, this time we use the opportunity to point out the important fact of each of the styles. It’s basic setting, actually aims to define the way in which to better manage the investment in the Forex market.

Every evident difference between the styles, which we, at first sight, perceive, is essentially a model for the tactic and trading method that is fundamentally used, which better adapts to the personal type of trader.

In concrete terms, fundamental and technical analysis, with many of their indicators, multiple affect psychologically different types of personality.

The essence of the psychological analysis of the currency market, shapes and naturally establishes certain types of behavior and Forex trading styles. Together with the mutual agreement with other analytical factors.

Therefore it is quite clear that before adopting any of the Forex trading styles, very detailed knowledge of all of its methods is important.

As well as ways to apply the principles in practice. It is very important.

Given that the market is “live” and especially mobile in periods of high volatility, the demand for the creative and research mentality of the trader is especially evident.

Good knowledge of the methodology of the adopted Forex trading style allows to trade “by cliché”, in terms of using technical tools and applying familiar tactics. But there is certainly a situation in which our personality dominates. It is where to choose the decision to enter/exit the position!

All individuality and arbitrariness of the moment of entry/exit from the position are just one of the factors of the complexity of the style of trading choices.

Also, the selection of one or more indicators, when making the analysis and the process of tracking changes in the market. And the specific way of perceiving their application begins to define the trader to leave creativity out of the framework of strict templates.

In this sense, any upgrade of the tactics brings new results and favorable trades, and thus forms a trader’s style.

One note, each tactic has its advantages and disadvantages. Before we adopt some of the styles, we need to know that there are many paths to success. So it is important for each of the styles to see the basic settings that have proven successful over many years of usage. In the case of the “News” style of the trader, we will use all of his positive aspects to show the most frequently used tactics, along with the graphic illustration.

Trading with this Forex style as a basic advantage has the fact that it is known, in advance, that the market will start at a previously given time.

„News“ trader as one of Forex trading styles

news Forex trading style

The graph shows an example of “news” trading. That means trading in the publication of economic news. The most characteristic of this style is that the strategy offers trading performance in a short time interval.

This is the most affordable style is exactly for those traders who do not have time to do this job for a full-time job.

Following the chart, we notice the first phase, where the bounce form appears, due to uncertainty about the outcome before the news release itself. In the second phase, there is a breakthrough in the level of resistance/support, which leads to a sharp price movement and opportunity for profit. After the initial impulse, just when he reaches the maximum of his movement, there is an attempt to return the price back.

These stages are part of every market reaction in the publication of economic news, and trading strategies at these stages are known as trading on “breakthrough”, “riding” by bull or bear, playing on both sides at the same time – “hedge”.

Hedge tactic as one of Forex trading styles

hedge Forex style

Before announcing the news, entry into the position is done in both directions, sell and buy, at the same time.

Once the news is published, the trader leaves the “losing” position, while retaining a profit-making position.

Primarily, this strategy offers avoiding the risk of making a failure in the decision to predict the price trend.

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Another advantage is that there is no limited choice of the currency pair because all currencies are subject to news releases. The aggravating circumstance of this tactic is reflected in the skill and ability of the trader to quickly make a decision to retain the “winning” position. The past performance does not guarantee future results, you have to remember this.

Depending on the planned trade, it can be considered a good result of a loss of up to 20 pips. But the trend in the opposite/positive direction is not bad, that is, a favorable trade achieves more than the lost 20 pips.

You have to decide is hedging for you.

It’s like driving a Ferrari! It is not for everyone.

If you are considering using Forex hedging strategy then you need to understand what you are getting into.

Regardless of what you have read before, there is no such thing as a surefire way to profit with hedging.

Every benefit of a Forex trading style has a corresponding drawback.

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When done correctly, you will have consistent returns and it is the biggest benefit of hedging.

Low returns per month are the biggest downside of hedging. So you will need a fairly big account or trade for investors if you want to trade it full-time.

So, once again. What is hedging?

Hedging is when you hold a long and short position in the same currency pair, at the same time. It is also one of the Forex trading styles.

This may not make sense at first. You will not make any money if you do this.

But hedging is a great way to limit your risk, while the market figures out which direction to go. When the market shows its true face and starts trending you can start to profit from your winning trades. The most important, you will minimize the losses from your losing trades. Also, you can use the partial hedging to reduce your loss if you are wrong about a directional trade.

Nobody knows, with 100% precision, what the market will do next. Therefore, holding long and short positions at the same time can allow you to profit from price movements in both directions.

Trading on the breakthrough is one of Forex trading styles

breakthrough trading style

This Forex trading style is a tactic that follows the price trend on the news release and the return after the news. It is an entering the position, after the announcement of the news, and in the direction of the line break, in order to keep the position until the end of the movement.

The return after the news is part of the strategy, which after reaching the end of the first movement, with the help of Fibonacci retracement, performs the trade in the direction after a return.

A breakout can be an extremely profitable trading opportunity.

This strategy is used by adventurous traders. They study to identify patterns in resistance levels. Hence, they will often try to buy security when it breaks above a level of resistance or below a level of support.

A breakout is a situation in which the price of an asset breaks through a level of resistance. And at the same time, increasing to an unprecedented price. When the resistance level breaks through, that new peak price becomes the next level of support when the asset experiences a pullback in price.

Riding on a bull or a bear as one of Forex trading styles

Riding on a bull or a bear

This is one of Forex trading styles (the expectation of the results – bull / buy or bear/sell) is treated as one of the most aggressive. So it is mandatory to set up a stop-loss (SL) order. Also, it is advisable to limit the profits of the take-profit orders (TP).

That’s because of complexity prediction of the main trend and level of its movement.

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The great help, of course, is good information and governance by fundamental analysis. It is crucial to determine the trend of price trends before announcing the news.

How to profit in Bear markets

A bear market is defined as a drop of 20% or more in a market average. Generally, bear markets occur during economic recessions or depressions, when pessimism prevails. But amid the rubble lie opportunities to make money for those who know how to use the right tools.

And to choose the best Forex trading styles.

So, how to profit in bear markets:

Put Options.

A put option is the right to sell a stock at a strike price until a certain date in the future. It is the expiration date. The price you pay for the option is a premium.

The value of the put option rises when the underlying stock falls.

When the stock falls below the put’s strike price, you can exercise the right to sell the stock at the higher strike price. Also, you can sell the put option for a profit.

Short positions.

Taking a short position, or short selling is the situation when you borrow shares. You are selling them because you expect that the stock will fall in the future. You buy shares at a lower price to cover the short position and make a profit on the difference.

For example, you want to short some stock at $40 per share. The stock falls to $15, and you can buy the shares back at $15 to close out the short position. Your overall profit, therefore, is $25 per share.

Short ETFs.

A short exchange-traded fund (ETF), gives returns that are the inverse of a particular index. For example, an ETF that is inverse to the Nasdaq 100 will drop about 30% if that index rises by 30%. But if the index falls 30%, the ETF will rise proportionally. This inverse relationship is appropriate for investors who want to profit from a downturn in the markets. Also for investors who wish to hedge long positions against such a downturn.

How to profit in Bull markets

Bull markets are periods of economic growth and financial optimism. How may you profit in such periods:

Call options.

A call option is the right to buy a stock at the strike price until the expiration date. Calls go up in value as the underlying stock’s price rises. Say, the stock price rises past the option’s strike price. Then the option buyer can buy the stock at the lower strike price and sell it for a higher price. They are generating a profit in that way.

Long Positions.

A long position is the purchase of a stock or any other security. With the expectation that its price will rise. The goal is to buy the stock at a low price and sell it for more than you paid. The difference is your profit.

Long ETFs.

Most ETFs follow a particular market average, and trade like stocks. The transaction costs and operating expenses are low, and they require no investment minimum. ETFs, seek to replicate the movement of the indexes they follow, fewer expenses.

The bottom line

Point is to choose the best among different Forex trading styles. The one that best suits you and your goals.

There are many ways to profit in both bear and bull markets. The key to success is using the tools for each market to their full advantage. Short selling, put options, and short or inverse It is important to use indicators to spot when bull and bear markets are beginning or ending.

Every trader should understand these terms since they’re used frequently in financial news, trading articles and in the papers. Long, short, bullish and bearish are terms used in all markets and on all time frames, regardless of whether you’re day trading or investing, or trading soybeans or currencies.

Risk Disclosure (read carefully!)

6th January 2019
Investing In The Forex Market

How to Forex investing? It isn’t a get-rich-quick scheme but it is full of potential to become wealthy

By Guy Avtalyon

Investing in the Forex market is growing and people from all around the world, especially from, India, are choosing to invest in Foreign Exchange markets, after the regulation of brokers’ work and their massive presence on the market.

In this regard, investing in the Forex market can be a good alternative for all those who want to make a high return on invested money.

Nevertheless, regardless of the many advantages of Forex, many investors are quite skeptical when it comes to investing large amounts of money. The reason lies in numerous myths, rumors, and misinformation that can often be found on the Internet, and they are referring to the Forex market.

In the shortest, it can often be heard or read that the Forex market is a dead end, an ideal place for losing money, a fata morgana in the desert, and so on.

For this reason, investors instead of developing the right trading strategies, are often subject to rumors. Hence, they do not make the right decisions or completely abandon or omit to invest in the Forex market.

On the other hand, there are completely different myths.

There are people who believe or have heard the myth that they can get rich overnight without one day of financial education. So they believe that Forex is the right place for that.

What is investing in the Forex market?

Someone would say, instant win with minimal or almost no investment. But this couldn’t be more wrong. It is true that behind any desire for quick rich is the lack of experience, the uncertainty, and the lack of a properly defined strategy. Success on the Forex market comes slowly, step by step, through education, practice, and only if it is based on realistic expectations.

Often another myth can be heard. The is investing in stock markets is nothing more than a pure game of happiness. This is certainly far from the truth and such myths are the result of a lack of financial education. Forex is not gambling. Anyone who has read something about the Forex market, if they really wanted, could easily understand the mechanisms of price formation on the market.

Here’s one myth more about investing in the Forex market. Money can be earned on Forex, but that means a lot of nights without sleep with a computer in front. And many hours of night trading on a trading platform.

That’s another untruth about investing in the Forex.

Any standardized financial education or course in this area will teach you to invest in a minimum amount of time. Practically, from the computer, you will only read the latest news. Making a strategy and making decisions is not something that is done every hour. It has a longer-term character. Not to mention mid-term and long-term investments, where you can almost neglect any day-to-day operations.

In the case of unforeseen news, whether good or bad, you certainly can make a change in the investment portfolio. But this is not something that happens every hour or every day.

Is Forex worth investing in?

Discipline is the basis of every success and it comes in combination with solid knowledge. It comes with a great role in patience and significant experience.

Successful investing in the Forex market is only a consequence of well-planned and executed trading operations.

That involves taking into account all important economic events, permanent informing, and essential understanding of price graphs.

Finally, for all those who do not have adequate education in this field and recognize Forex as a good place to invest, the first thing they need to do is find the right provider of financial education. They have to choose mentors and plan personal development goals. The mentor is one who will propose to you the appropriate type of training, course, etc. And that one will be your guide through the first practical operations.

The Forex market is a very complex mechanism. The undeniable fact is that it generates various controversies.

However, the main cause of these controversies is ignorance. If you want to take advantage of the opportunities for earning in this field, you must break all the prejudices, myths, and misconceptions surrounding it.

If you are dealing with a trader’s job, you will probably be interested in the so-called “Robo-forex” ie robotic/automated business on the forex market.

How to Forex investing?

In other words, can you actively trade without moving a small finger?
It’s possible but you’ll have to do something. You’re the one who has to give instruction, you’ll have to specify inputs. Then, how is it automated, you may ask?
It’s about a program called “The Forex Expert Advisor” (Forex Expert Advisor) and can be used within the Trading Platform.
This program works independently, although based on the instructions you specify. But it does not require your direct participation in the execution of trade orders or any other market activity.

So, robo-forex executes all tasks independently, meaning automatic.

All you have to do is set the target through an online trading platform that is linked to a broker server. Then the Forex Expert Advisor will start trading according to the given instructions. It is important to note that forex market experts are necessary as advisors especially if you’re a beginner. In this way, you don’t have any responsibility for decision making and, practically, you’ll trade without stress.

What’s more, in that case, you don’t have to be an expert or have a deep knowledge of technical and fundamental analysis. These jobs are contained in the Forex Expert Advisor Add-on – Trading Program.

So, this means that you can practically be away from the computer because your “advisor” will monitor and process all trade signals in case of your absence.
So, it’s possible to invest in Forex and trade this market with a little effort and engagement.

Forex as investment

You have often had the opportunity to hear that investing is not a sprint but a marathon.

This means that if you want to succeed in a tough business such as trade in financial markets, you will have to, among other things, spend a lot of time on it.

To run in the long run, you do not need the 500-euro sneakers. You can run in the old one. The point is that you can start investing in Forex even with a little money but you’ll have to do so in a way that is suitable for you.

The price is not the most important issue when you investing in the Forex market. The most important is to feel comfortable as much as you can. Because it increases the chances that your race will end successfully. So, take advantage of this growing market. And stay tuned, follow Traders-Paradise. You’ll find plenty of valuable suggestions and examples from real investing and trading.

4th January 2019
Bitcoin Price Prediction for 2019

Bitcoin price prediction can be a very tricky job. The market is volatile and Bitcoin itself is a real roller coaster.

By Guy Avtalyon

What is the Bitcoin price prediction for 2019? What can we expect? Can we expect a new bull run? Will the BTC price stabilize? Are we in for another bear year? Will Bitcoin crash or rise?

So many questions. Many experts and influencers have shared their price predictions for Bitcoin in 2019.

Most of you know of the famous Bitcoin price prediction of John McAfee. He said he will eat his dick on national television if BTC not hits $1 million by the end of 2020.

Now, McAfee didn’t give a price target for 2019, but based on his 2020 prediction Bitcoin needs to be worth just over $170,000 on December 31, 2019, to be on track to hit the $1 million mark a year later.

Well, it’s time to be serious.

Seriously, how far can Bitcoin price actually go? No one knows where the price is going to go. These sorts of price movements are common in the volatile world of cryptocurrencies.

But, 2019 is what the crypto fans are looking forward to. The NASDAQ has also vowed to launch Bitcoin futures in the first half of 2019.

One of Bloomberg’s column stated that there is a probability that FUD(Fear, Uncertainty, and Doubt) might loom over crypto space in 2019.

Also, analysts and enthusiasts kept their hopes high. Mike Novogratz said explicitly that he believes there is going to be big adaption in 2019, 2020 as he thinks there will be more contributions from people in the blockchain world.

After the state government of Ohio has announced that it is going to accept tax payments in BTC it sounds possible. The government has partnered with Bitpay to make this happen conveniently. So it is possible now the bitcoins can be converted into dollars on behalf of the tax office. The adoption rate going higher and higher.

Market Prediction For Bitcoin Price

The market is experiencing volatile conditions. Let’s take a look at the prediction with the market experts. They have been the mind of the cryptocurrency market. Let’s take a look at the famous Bitcoin predictions:

John McAfee, the founder of the popular McAfee software and a bright Bitcoin follower predicted that Bitcoin will hit $1 million by 2020.

Sam Doctor and Tom Lee Bitcoin Price Prediction

Tom Lee, ex-Chief Equity Strategist JP Morgan, and Co-founder and head of research of Fundstrat, believes BTC would grow.

He is counting on more institutional investors taking on Bitcoin and a steady increase in the Bitcoin user base. Lee explained the current fall in the price of bitcoin by referring to the recent plunge in the price of tech stocks, like Amazon, Apple, and Facebook. He thinks that increased institutional fortunes would help turn BTC’s future around very soon.

Tom Lee said that the BTC fair value is much higher than the current price. The current fair value is somewhere between $13,800 and $14,800 which he believes might increase and reach $150,000 per coin. As soon as bitcoin wallets account for seven percent of 4.5 billion Visa holders.

Sam Doctor, an analyst from Fundstrat along with Lee predicted that by 2019, BTC might reach nothing less than $36,000, with the probability of $64,000 at the maximum and $20,000 at its lowest.

Sonny Singh Bitcoin price prediction

In a recent interview for Bloomberg, Sonny Singh, the chief commercial officer at Bitpay commented on why it is okay not to panic looking at the current market condition.

Singh, who is a Bitcoin maximalist, called Bitcoin an “800-pound gorilla, as it has access to the most notable “network effect” of all decentralized networks. He is assertive of the fact that there is a high possibility that BTC might reach $15,000- $20,000 by Thanksgiving, 2019. He was explaining that the probability of a crypto ETF and an influx of funding for startups is high on the cards.

Ronnie Moas Bitcoin price prediction

Ronnie Moas is a cryptocurrency analyst. He predicted that BTC might reach $28,000 by 2019. Also, he believes the demand for BTC would increase with its decreasing supply. And he claims that by 2019, the adoption rate would increase. Hence, people would demand more of it. But remember, BTC is not unlimited in supply.

Anthony Pompliano Bitcoin price prediction

Anthony Pompliano, founder of Morgan Creek said that “Bitcoin isn’t going anywhere:”

Pomp tweeted that BTC might go as low as $3000, after which it will continue being bullish starting from 2019. He declared that there is no reason to freak out on the declining price as Bitcoin’s fundamentals are becoming stronger.

Traders Paradise Bitcoin price prediction

Bitcoin has been experiencing fluctuations over time. But Traders Paradise strongly believes that Bitcoin will soar up. We have to remind you that Bitcoin’s price falls when Bitcoins being used for illegal purposes. And Bitcoin experienced so many troubles like hacking and stealings. Also, you have to know that Bitcoin is still the market leader.

NASDAQ is launching BTC’s future, that too at the very beginning of 2019. So, Bitcoin’s price might reach greatly increase by the end of 2019. Hence, this year could have a good prospect and development for Bitcoin.

This year will be bullish for Bitcoin. More people will start believing in the technology behind Bitcoin. It is very possible for Bitcoin to tripled price by the middle of 2019.

There is some logical explanation, the more the trading, the more the price.

We all know there can be only 21 million Bitcoins mined, out of which 17 million has been mined already. That means only 4 million to be mine. That will make its value more. Besides that, more and more countries have shown willingness to integrate Bitcoin and other cryptocurrencies into their financial systems. The governments and the central banks will embrace the digital currencies. Hence, the demand should be more.

Truth is that regulated markets can function freely and securely.

Bitcoin prices in 2019 will be marked by volatility which has made bitcoin price prediction in short-term a bit of a challenge, even for experienced analysts. So far, 2018 has presented its own surprises though not a dramatic as the rollercoaster it was in 2017.

By the end of the year 2019, the Bitcoin price could reach five-digits value. That means that the 2018 bearish trend ends and shifts to the bullish trend.

Traders Paradise’s prediction is that the cryptocurrency market will experience a certain optimism in 2020. Not only Bitcoin, but all the major cryptocurrencies will also experience an upward shift.

By 2023, Bitcoin will be used more often by more people. The real-time use case will be increased. That will make it even more powerful.

3rd January 2019
A chaotic December in equity markets

2 min read

Image from shutterstock.com

What caused a chaotic December? A chaotic December in equity markets is closing. But, at the end of the year, these were not usual circumstances.

It’s “completely bizarre,” says Stephen Innes, head of trading for the Asia Pacific at Oanda Corp. “It’s incredible just how harmful markets veer when sentiment slides.”

Innes mostly is keeping his money on the sidelines. But he has been taking profit on some winning investments. And, also, from blue-chip stocks whose valuations have dropped in the December sell-off.

Like many other traders in Asia, he’s been watching events play out in the U.S. from a distance, astonished at what he sees.
So, what he did see?

Source: Bloomberg

The S&P 500 Index posted its biggest upward reversal since 2010 on Thursday. Just a day after the largest advance since 2009. Despite this two-day gain, the measure is still down almost 10 percent in December alone.

That’s the largest drop for each key market barometer since 1931, according to data from LPL Research. But those Depression-era losses were much bigger: the S&P 500 plunged 14.5% while the Dow plunged 17%.

Two golden rules have been broken.

First, since 1945, December has produced the highest average gains of any month. But December is the worst month of the year. Second, since the 1970s, the S&P 500 has never slumped when earnings growth was more than 10 percent.

Mark Matthews, head of Asia research at Bank Julius Baer & Co. in Singapore, is planning to ride it out. “I remain invested through good times and bad,” he says. “Not being invested, over the long term, is like betting against the house in a casino.” He is a long-only investor.

The December 2018 chaos is making investors nervous.

This chaotic December in 2018 could have an impact in the future. The investors are worried that the economy could slow in 2019 because of continued trade tensions with China and rate hikes by the Federal Reserve.

The Dow and S&P 500 are both in the red for the year, their worst annual loss since the 2008 Great Recession, and first annual loss since 2015. Last year, the S&P 500 returned 22%.

For the past, eight to nine years never happened the U.S. market dropping at this magnitude and speed.

Maybe the solution is to go overweight cash for the time being. The volatility will continue until year-end until investors get a clearer picture from the holiday earnings season, say experts.

But longer-term, it is unknown if this will prove a “healthy correction”. The investors may find the S&P 500’s low valuations are attractive and earnings come in above expectations. Or it will mark the end of the bull run. Either way, one thing’s for certain, this movement is definitely unusual.

This market turbulence isn’t normal.

Maybe investors should keep away from new trades and tend to the existing investments. Anyway, investors opinion is very bad.

Yes, most of them don’t think that this huge volatility will continue. But also, they are thinking that it is not a quite good idea to trade stock while the market is like this.

The investors can’t hope that the markets will turn around in the year’s final days. They are here and it is obvious that nothing will change.

In the past years, December was usually a very solid month for the market. Professional money managers used to buy top-performing stocks. That made their portfolios look good. This phenomenon is known as window dressing.

There was also the somewhat mysterious Santa Claus rally effect. The market was very well in the final week of the years.
There was some chalk up to light trading volume with so many people off for the Christmas holiday.

But volatility remained this year. Stocks are down.

It is, as we can see, unusual for this time of year. But the people take holidays. They have hope that the U.S. economy is robust and the sell-off will bottom out.

For this time of year, some people are probably a little more focused on the market.

But trying to explain short-term movements in the markets is an exercise in futility because generally, it is pretty random.

Not only stocks, but Bitcoin has also had a brutal 2018.

This chaotic December in 2018 had an impact on cryptos too.

The world’s largest cryptocurrency by market cap is nearly 84% since its meteoric rise topped out at an all-time high of $19,870 in December 2017.

But just after bitcoin (BTC-USD) peaked, technical trader Peter Brandt made a fantastically prescient call. This has recently resurfaced in crypto circles. In January, he called for an 80% retrace of bitcoin’s parabolic advance, predicting a $3,933 price target. Bitcoin is currently trading around $3,600. It was very close.

But as ever, there were different opinions.

The dominant Bitcoin price prediction was that Bitcoin would reach the $14,000 mark by the end of 2018.

However, that prediction is blown out.

Despite some optimists who were hoping that Bitcoin will break through the $100,000 barrier till the end of this year. In fact, Jim Cramer was predicting that Bitcoin will go as far as shattering the million dollar threshold one day.

To do so, market capitalization should surpass 1 trillion USD just on BTC to reach $66,000 per coin, a 10x increase. Well, the entire market cap is at $212 billion. The BTC market cap was $170 billion almost a year ago. Now it is $115 billion and it was at $800 billion in January 2018.

So, who knows what can happen.

Today’s price of BTC you can see here

One thing is certain. After this chaotic December in 2018, next year will be difficult and uncertain. Markets will be full of volatility. Permanent ups and downs.

Anyway, it will be interesting.

Risk Disclosure (read carefully!)

2nd January 2019