Trading Psychology and Methodology

1. Currency Pair Analysis: Perform a world class analysis to determine which currency pairs have the greatest profit potential.

2. Trade Management: Trade management techniques to take the most of each trade when the market moves on their favor.

3. Study the Market: Entry system adapts to the current market conditions, follow the market instead of guessing.

4. Risk Management: Risk management techniques to set stop loss and take profit orders at optimal levels. Accept risk and feel comfortable with their trading, they know it’s the only way to get consistent results.

5. Money management techniques to allow the geometric growth of their account and avoid the risk of ruin.

Long-term analysis: Methodology to determine which currency pairs have the greatest profit potential.

Short-term analysis: Entry systems: breakout, retracement and continuation price action entries.

Capital management: Determine the formula that you will use to decide how much capital to risk on each trade.

Trade management: Strategies to manage trades, when to scale in and scale out of trade and more.

Risk management: Optimal levels to set stop loss, take profit levels, trailing stop to help you reduce risk.

Trading Psychology: what needs to know to accept risk and feel comfortable about every trading decision made.

All the above qualities are being taken care in Equidious Research.

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Learn About Forex Demo Account

The demo account (or we can say DEMONSTRATE a/c) is actually a platform for demonstration of all your theoretical knowledge. We might have learnt numbers of patterns, charts, indicators and many more analytical tools. However, as a beginner or an experience Trader, one cannot apply all these theory directly on Real Account and risk all the money.

Thus, Demo Account is an interface/platform where the user gets the same feelings, emotions and practical knowledge that he is getting in real account. Our Team suggest all the beginners to start trading with Demo Account for few days and then switch to real account.

Why To Start With Demo Account?

If you are beginner, then its really important to start trading with demo account for the following reasons:

• Demo Account doesn’t involve real money.

• Freely learn to place orders, follow the entry levels.

• Demo Account provides equal opportunity to use all the indicators as that of real account.

• May face and analyse the fundamentals of market without loosing any real money.

• Its a good practice platform.

What NOT to do with Real Accounts?

Well, as demo account is really helpful for all your learning purposes but the following things should be noted before starting with your real account.

• Capital Management. As demo account involves virtual money, traders makes an habit of trade with bigger lot size on real account also. Money Management is really important factor when you switch from demo a/c to real a/c.

• Risk Analysis. When you trade with demo account you are in risk free zone as you have nothing to loose but with real account Risk Analysis is important part of trading.

• Its really not necessary, if you are good in demo account then you will surely get good profits in real account. You may need expert Analysis or a good research team with good signals.

All the above qualities are being taken care in Equidious Research.

Join 300,000+ traders who stay ahead of the market, submit your details with us by filling our CONTACT FORM.

For the Best Forex Signal| Accurate Stock Signal| Profitable Comex Signals, Try Equidious Research Services. We have a team of best and well experienced Research Analysts.

Trading is an art of making handsome amount.

Enjoy Trading!

Need of Moving Average in Forex

The Moving Average, MA for short, is probably the most popular trend following indicator used by Forex traders. In this blog we will discuss more about Moving Average (MA)

What is Moving Average?

A moving average is a type of lagging indicator that accumulates past price points and then averages them to provide a technical analyst with a better sense of where a security went over a period of time. There are a handful of different moving averages, including the simple moving average (SMA) and the exponential moving average (EMA).

Moving averages help forex traders make effective transactions by aiding them in evaluating the price history of a currency pair or related investment. More specifically, these averages make it easier for investors to interpret the price fluctuations of an asset by smoothing out their random movements.

One sweet way to use moving averages is to help you determine the trend.

The simplest way is to just plot a single moving average on the chart. When price action tends to stay above the moving average, it signals that price is in a general UPTREND.

If price action tends to stay below the moving average, then it indicates that it is in a DOWNTREND.

In an uptrend, the “faster” moving average should be above the “slower” moving average and for a downtrend, vice versa.

CALCULATING THE SMA

To calculate the SMA, one must start by gathering a security’s closing prices over a fixed number of trading sessions.

If a trader wants to determine the 20-day SMA of the EUR/USD, he can add up all the currency pair’s closing prices over the time and then divide by 20. Alternatively, figuring out the 200-day SMA of the same currency pair would require totalling its closing values during that time and then dividing that sum by 200.

CALCULATING THE EMA

Calculating the EMA is a bit more complicated, as this indicator gives greater weight to more recent values in order to reduce the effect of lag. To determine this moving average, a forex trader should begin by selecting a time period, for example 10 days, and then calculating its SMA.

Next, the investor should figure out the multiplier he will use to give the most recent data points greater emphasis. The size of this multiplier will depend on how long the EMA is.

To calculate the multiplier, one can use the following formula:

• Multiplier = (2/(number of time periods) + 1)

• For a 10-day EMA: (2/(10 + 1)) = 0.1818 or 18.18%

• For a 20-day EMA: (2/(20 + 1)) = 0.0952 or 9.52%

Once this multiplier has been acquired, the following equation can be used to determine the EMA:

• Multiplier x (closing price – EMA(previous day)) + EMA(previous day)

If investors take the time to master the moving average and the many benefits it provides, they will have access to a wide range of tools they would not be able to harness otherwise.

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What is a Forex Swap Trading?

What is a Forex Swap?

A Forex Swap is when you buy a high interest currency against a low interest currency. For each day that you hold that trade your broker will pay you the interest difference between the two currencies as long as you are trading in the interest positive direction.

Forex Swap Offers Two Ways To Profit

The forex carry trade is a type of strategy in which traders sell currencies of countries with relatively low interest rates, and use the proceeds to buy currencies of countries that yield higher interest rates.

Forex swaping leverages the differences in interest rates between countries. For example, one country’s central bank may lower interest rates in order to create economic stimulation, while the central bank in another country maintains higher interest rates.

In effect, the forex trader borrows money in one country with a lower interest rate, and invests it in another country with a higher interest rate, and keeps the difference in yield as profit.

A positive-carry forex trade (or simply “carry trade”) means that the position has a positive spread between the interest rates of the currencies. The carry trade strategy can capture this spread, and the profits depend on the leverage applied through the mechanical trading system.

How does Forex Swap work?

Forex Swap offers forex traders an extra dimension of profitability. When the carry is positive, the forex position can accrue positive income even while market fluctuations cause a short-term loss in currency value.

For example, in buying one lot of EUR/USD, the trader is buying one lot of Euros, and selling one lot of Dollars. By maintaining the position overnight, the trader pays interest on that currency which was sold, and he or she receives interest for the currency which was purchased.

So, in this example, if the interest received from the purchased Euros is greater than the interest paid for the sold Dollars, the trading account gains simply by holding the position.

The longer the winning position is held, the greater the possible interest income and the thicker the cushion against fluctuations in the market.

A Forex Swap creates an extra opportunity for profit as well as a layer of additional protection. And, the carry trade can also increase the potential longevity of a holding.

Part of the appeal of Forex Swap is the possibility of earning interest. Typically, income accrues daily for long carries with triple rollovers. Here’s the calculation to approximate daily yield:

[(Interest Rate of the Long Currency) – (Interest Rate of the Short Currency) / 365] x Notional value of the position

So, for example, for one lot of NZD/JPY with a notional value of 100,000 the interest can be calculated like this:

[(0.0333 – 0.0033)/365] x 100,000 = about $8 per day

This amount will be approximate, since banks use overnight rates which fluctuate daily. As well as yield for forex traders who are long NZD/JPY, traders whose strategies involve “fading” the carry, or else going short NZD/JPY can also earn interest.

Hedged Carry Trades

Yet another type of carry trade involves hedging one long carry trade with another short carry trade using different currency pairs that are closely correlated and which results in a net interest rate benefit to the overall position.

For example, a hedged carry trader might exploit interest rate differentials between well correlated currency pairs like the following:

• EUR/USD and USD /CHF

• AUD/USD and NZD/USD

• GBP/USD and USD/CHF

• EUR/JPY and CHF/JPY

• GBP/JPY and CHF/JPY

Such hedged carry trades are often highly leveraged to make them worthwhile, thus much more risky. Nevertheless, the main risk to this hedged carry trade strategy arises if the correlation between the pairs breaks down for some reason and subsequently results in losses. Remember that the correlation risk is of course not the only risk factor to consider, just one of them.

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Impacts of Trade War

Traders are struggling to place trade concerns into a coherent narrative. As the instigator of the recent trade tensions with most of its major partners (China, Canada, Mexico and the EU), the U.S. economy could soon see exports take a hit from multiple directions. From another perspective, the U.S. economy is outperforming most of its global peers and therefore may be best situated to weather a protectionist-driven economic slowdown.

Currency war, also known as competitive devaluations, is a condition in international affairs where countries seek to gain a trade advantage over other countries by causing the exchange rate of their currency to fall in relation to other currencies.

Trade war risks becoming a dangerous currency war as China weakens yuan the most in 2 years.

Not only does the threat of a trade war impact the day-to-day of the currency markets, it is also related to a currency war where countries devalue their own currency so exports can be sold cheaper overseas in order to jump start the economy at home. The problem with currency wars – just like trade wars – is that more often than not there are no winners.

The United States’ trade deficit to China no longer seems the top issue in the trade war: A deal for an additional $70 billion in Chinese purchases of US goods was reached after rounds of bilateral negations in May and June. Yet, that didn’t stop US President Trump from abandoning the deal.

For China, it can no longer rely on high growth rates that it enjoyed for decades; the need for industrial upgrading and developing new momentum, such as high-technologies, has become inevitable. In 2017, China announced it had shifted emphasis on quality over speed for economic growth. The Chinese government will support innovations and technologies industries further, as well as promoting the “Made in China 2025” plan.

As the world’s largest economies open up a new front in their increasingly acrimonious game of brinkmanship, the consequences could be dire — and ripple far beyond the US and Chinese currencies. Everything from equities to oil to emerging-market assets is in danger of becoming collateral damage as the current global financial order is assailed from Beijing to Washington. Risk assets and oil prices would likely tumble as worries about growth arise, hitting currencies of commodity-exporting countries particularly hard — namely, the Russian ruble, Colombian peso and Malaysian ringgit — before taking down the rest of Asia.

The present currency war started in January 2010. The problem with currency wars is that all advantage is temporary and is quickly erased by retaliation. Trading partners retaliate with their own devaluations. Currency cross-rates end up back where they started, with costs imposed due to the uncertainties. Not only is the world not better off but it is worse off because of the costs and uncertainty resulting from the currency manipulations. Once countries realize that currency wars don’t work, they turn quickly to trade wars through tariffs and other trade barriers.

Join 300,000+ traders who stay ahead of the market, submit your details with us by filling our CONTACT FORM.

For the Best Forex Signal| Accurate Stock Signal| Profitable Comex Signals, Try Equidious Research Services. We have a team of best and well experienced Research Analysts.

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