Friday, May 18, 2007

Detecting trend reversal on Forex

I know that: "How to detect trend reversal?" maybe a thought question with very complex answer but I will try to make my take on it, and keep it very simple and understandable.

So let’s get started, obviously when trying to detect trend reversal on Forex you have to use tools that were designed for it. You can’t predict it with MACD or RSI because they are trend following indicators. Indicators designed to predict trend reversal are … candles. Japanese always traded reversal strategies, European and US traders are almost always trend following traders.

If you don’t know how to interpret forex candles then do a search on web and find some info, reading correctly candles is easy and you have to know it. Although keep in mind I do not recommend using them on charts smaller then 4H.

Of course … relying only on Japanese techniques can be quiet deceptive so we need something more reliable, we need to have an angel. Trend reversal candles can happen anywhere on the chart, will they always mean end of the trend? … No, the really important candles are those which can be found near support and resistance levels. We want to know if this particular level will be broken or not.

Let’s pretend we have reverse candle near support, is it time to buy some lots? Again the answer is NO. Take your time, the next candle should be white which is confirmation that trend was reversed, there can also be consolidation period near resistance level, which is usually another sign that trend is reversing, in this case I would put long order at the resistance of consolidation block.

Where to put stop loss? I put it about 100 – 200 pips below my order depending on situation. I mean if important resistance or support line is broken and price move fast in opposite direction (eg. 100 pips) then there is really no point in holding this position any longer, trend wasn’t reversed.

Well, I hope this helps some of you, but if you are going to use this techniques then keep in mind they apply to longer timeframes! I use it with 1D charts, if you will use it with 15M chart you are going to blow yourself out.

Monday, May 14, 2007

Completely free 100$ for Forex trading!!!

This is something you do not want to miss, gives 100$ to everyone who opens live trading account with them. You thought 5$ from Marketiva was great? Then how you can call this? Awesome? Not exactly.

First of all, i took a look at them and here is what i found:
- Their charting sucks, you can't do intraday trading it is just impossible.
- Their support staff can't speak english fluently - not very professional as for real company.
- It looks like they like ... no they love the game of stop loss hunting - not good also.
- You cannot withdraw free cash, but you can withdraw money you earned, similar to marketiva system

My opinion Russian scams.

However if you are swing trading, and use other software for charting then software then you can try them out, they require only one document with a photo to open an account so it is pretty simple.

So if you would like to take advantage of this free 100$, which they will give, this was double checked by my friend who signed up for their real account here is what you need to do.
1. Go to and get a pin code.
2. Go to and signup for live account, remember to use your promo code which should be sent to your email address if you correctly completed point 1.
3. Start trading.


Forex trading video?

Lately i was thinking that there is nothing better then one on one live training, you can ask your mentor questions, he will tell you what you are doing wrong and so on.

However over the internet it is almost impossible to emulate live training session, so i was thinking. Maybe it would be good to record video and show it online. I was thinking about some sort of 5 minutes instuction on how to use trendlines, how to use Andy Pitchforks.

I am not sure but i think that sometimes it is hard to understand method or indicator, just be reading article and seeing a picture. Video will be somewhat like live training.

But i don't know, i would like to hear your opinions on this one?

Saturday, May 12, 2007

How to make perfect entry point on Forex

If you find out that you make trades to early and before price starts moving in your direction the stop loss is already hit. The source of this problem is you are probably using to big timeframe. Don’t get me wrong on this one it is not that you need to change it, but you need to focus more on last candles, you are to concentrated on overall picture.

Anyway if you find yourself doing such trades then do not worry, this is easy to handle I had the same issue when I started trading.

Let’s break it down.

First of all your chart interpretations are ok. You make good trades but to early. So next time try this simple strategy.

After selection of new trade, find smaller trend in opposite direction and wait for reversal, when you will be sure that smaller trend is reversed make your trade. Sure you will loose some pips by getting late in to trend, but trust me there is no better point of entering the trade.

But what is the trend reversal confirmation?

Basically it is when you have more evidences that trend is reversed I won’t talk more about it now because this is covered in my other article, besides you probably have some techniques to determine trend reversal on Forex.