The other day I received the following question from a trader named Paul. I have inherited an illness (SCA1) and now work from home, as I can be at my computer for the majority of the day I tend to short-term trade. I only trade one currency (Euro/USD), and look to pick up just 10 pips on each trade. I use two moving averages and the MACD indicator for my trading. My moving averages are set to 10 and 5 and I only enter a trade when the two moving averages have crossed over and are pointing in the direction of the trade and the...

About a week ago I was involved in a meeting with my group manager and the guy I consider in many ways to be a trading/markets mentor. In it we were talking about how different types of market participants view information and resources. This is something I’ve spoken of before. The average trader/investor thinks of things like price data, analyst reports, education and all the various goods and services related to trading and investing as an expense. They are always thinking first about how much something will cost and...

There is a discussion on the Trade2Win forum regarding the reason why new traders so often fail. Here is a set of very, very good reasons posted by a member who goes by BSD. Most newbies fail because they are not in this to make money, they are in this to satisfy a primitive urge to be proven right. Most newbies fail because they never learn to seperate their ego from their money making needs. Most newbies fail in this because they never manage to identify what is success relevant; or if they do, they never manage to develop...

Ray Barros has posted a very interesting article on his blog which discusses the basis for the search for the holy grail. That quest is a major obsession of so many traders. Give it a read here. Struggling with support & resistance and knowing what the key market levels are? Check out the Price Distribution Analysis methods I use. AKPC_IDS += "519,"; Bookmark to:

This questions gets asked in one fashion or another on trading forum sites quite regularly. There is no best indicator, though. Never let anyone suggest otherwise. Each indicator you come across will have been designed for a particular purpose. Some are used to identify trends. Others are used to determine overbought or oversold conditions. Others are for momentum. And so on. Determining what indicator to use requires knowing how you’ll be approaching the market. When you have that in mind you can ask a slightly different question: “What...

Your book was indeed helpful in understanding forex trading, so helpful that I am about to open an account. However there is one thing which holds me. I do not want trade through dealing desks, but rather through ECN. The brokers, offering ECN trading station, would not provide any charting or historical data. All I have is just a station with quotes. What should I do in such case? How would I test my strategy without seeing what happened yesterday, for instance? Does it mean I must purchase an additional software which...

In case you weren’t sure how much of an impact fiscal policy could have on the markets, you should take a look at this chart of July futures for Crude Oil. One of my coworkers brought this to my attention the other day. Of course you can’t necessarily say for sure that the economic stimulus plan triggered the latest big rally in oil prices. It’s an awfully interesting coincidence, though, don’t you think? Why would there be a relationship? Because the stimulus package put about $150 billion back into...

Forex is a scam! I studied and practiced for quite awhile and as soon as I went live those MM make sure to go against your trade-they along with the big banks make the money. I feel they analyze your deal and make sure to go against it. This is something I received from an obviously disgruntled now ex-forex trader yesterday. He’s not the first to make that statement, and I’m sure he won’t be the last. I’ve been involved in the forex market as a trader and/or analyst for more than a decade now, so I think...

Brett Steenbarger is amazing! I really mean that. The sheer volume of writing the guy does blows my mind. And he’s doing it again. Along with his normal blog posting, Twittering, articles, and other stuff (not to forget his trading), he’s also working on yet another new book. The focus of the new book is becoming your own trading coach, a subject he’s been really concentrated on for some time now. He’s started a new blog to track his progress. You can find it here. Of course Brett’s two existing...

This question came through from a stock trader. I wonder if you can help me find a screener, I am looking to find Dow components above their 5 day ma. Stock screeners can be found in all kinds of place. A lot of brokers these days have them freely available to their customers. Some are quite detailed and inclusive. There are also a number of free ones online. Three of the most popular are: Google Yahoo MSN Money The CNBC site also has a screener. If you do a web search you’ll come up with a bunch of options – some...

I have written before on the value of understanding the fixed income market. Interest rates play a roll in every other market to a greater or lesser degree. Sometimes it’s a direct and obvious thing like the interest rate differentials which can drive forex rates. Other times it’s a bit more vague, like how interest rates are used in discounting cashflows for stock valuations, or in regards to carry costs in commodity markets. These influences tend to be more general and slow changing, though. But there’s also...