by Shawn Cannon
Do you realize how much money you are tossing away when you scalp continuously? Scalpers tend to trade a lot more than most traders. While I have been in a single trade for over two weeks now, during that timeframe there are traders who have been in and out of the market up to a 100, if not more times.
The more you trade, the more you pay to trade. Overtrading itself is a leak in one’s system as every time you enter a trade you are paying a spread. The trade I am currently in, I have only had to pay the spread twice. First time was when I entered the trade on Sept. 16. And the second time was when I added to my position after a retracement. In all, I have not even paid 6 pips of spread. As it currently stands, my open position is up …
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Posted In Trading Methods |
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by Shawn Cannon
It is relatively easy to make money in a trending market. Sometimes it’s as simple as watching which direction price is moving and trading with the flow. If you have a forex trading system that’s only profitable in a trending market, the worst thing you can to experience is a ranging market. In general, a ranging market could possibly devour the profits from a system developed around a trending market.
Now I’m not saying you cannot trade profitably in a ranging market. I am however saying it is more difficult. I personally would rather just not bother with a ranging market if I can hold out for the more profitable trending market.
There are a variety of indicators to help determine if price is range-bound.
ADX
The Average Directional Index indicator was designed to measure the strength of a trend. As such, if price becomes range bound the ADX level will decline. When …
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by Shawn Cannon
In my prior post I outlined a method of trading the NFP. I wanted to go over the very set up I described and show you how it actually works.
The arrow indicates the very candle when the NFP was released. As you can see the price took a huge dip down and it eventually retraced. After the close of the candle, an inside candle appears. I marked this candle with a check mark. It was at this point we are no ready to get into the market. Where the price goes from here will most likely be the overall direction the market will take after this major news release.
The horizontal line illustrates where a feasible entry should be. As shown price was still a bit erratic, however price soon turned bullish. There was more than ample time to pull pips out with some good profits.
Price eventually started making its …
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by Shawn Cannon
On the first Friday of every month, it is not business as usual for most traders. An important report is released that day: The Nonfarm Payroll report. This report is a tally of nearly 80% of the work force in the United States. The purpose of the report itself is to assist economists in determining the current state of the U.S. economy. The results of the report itself can also predict the future state of the economy as well.
What this means for the Forex trader is that this is a day filled with extreme volatility on the major currency pairs. If one is not careful, they can find themselves on the wrong side of the movement and find their position wiped out in a matter of minutes.
When price moves dramatically, people watch. It can possess an opportunity for traders to make a large sum of money in a short …
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by Shawn Cannon
I recently saw a poll on renowned trader Edward Revy’s website. He asked the question, “How long do you plan to trade Forex Demo Account before investing real money?â€
The results were as followed:
33% said they would demo trade 1-2 months.
35% said they would demo trade 3-6 months.
17% said they would demo trade about a year.
6% said they would demo trade for 2 years or more.
8% said they had no need for demo.
These were some interesting statistics, largely because the majority of traders fail in their venture. A CEO of a reputable broker was once quoted in saying that he would be surprised if even 15% of his clients were profitable. So what are the other 85% doing that’s causing them to lose money. Well if this poll has anything to do with it, people simply are not practicing enough.
Forex is a serious business. It’s neither a hobby nor a …
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