trade-of-the-day

Eur/Usd: Gaining Momentum to the Downside

Sat, 20 Mar 2010 18:39:20 +0100

Thursday and Friday of this week saw the Euro crash down to test the 1.3500 area and bounce off of that to move up, slightly. This momentum to the downside could potentially carry the euro to break the 1.3500 support area and even the most recent low of 1.3434. If those critical support levels break we could see a free fall in the Eur/Usd until the pair reaches the 1.3200 level.

In the past month the downward slide for the euro has stalled at the 1.3434 area and has been range trading for over a month. Don't expect the pair to drop without a fight as current support has proved to be strong.

Lets look at the 4hr chart.

*note Click on the chart to learn about our trading service.

You can see from the chart above that the pair has slowed down the descent at the 1.3500 level. This is easier to see by zooming in and looking at 1hr candles. On the one hour chart you can see the bounce and then the price started to turn back down again.

1hr Chart

My thoughts on the Hr chart show me that we are entering a consolidation period after the downward move. Watch the price to see if it breaks above 1.3550 or below 1.3500 that will be an indication of which way the price may be moving.

In addition to technical analysis to determine direction Forex Breaking News can be important to determine the direction and can cause many breakouts. Winners Edge Trading uses a News service called Trade The News, click on the link for a free trial.

I also recommend Forex Crunch a free site that gives a general overview of all upcoming news releases for the upcoming week. One other resource you can check out is a blog that follows the Eur/Usd call the Geek Knows.

Eur/Usd: Breaks Lower After Testing 1.3800

Tue, 16 Mar 2010 00:51:01 +0100

Today in early Morning trading the Eur/Usd tested 1.3800 and the pair continued to move south after the test. The pair has been moving in a slower range because everyone is waiting for the Greece news to come out. When there is more concrete news on Greece that news could impact the direction of this pair for a long period of time. The trading community is looking to see a Greece bailout to move the Euro higher.

1Hr Chart * Click the Chart to learn about our trading service.

Forex Weekly Video Analysis

Sun, 14 Mar 2010 19:04:01 +0100

The new week is upon us once again and it is time to prepare for your trading. This is the video analysis for 8 major currency pairs that I focus on during the week of trading. This video identifies key support and resistance levels that may help you when planning your trades for this week.

In addition to watching the video it is important to be aware of the different news announcments that impact the major economies this week. The Forex Crunch is a forex website dedicated to keep you informed of all the news that will have an impact on the major economies this week. I also follow a forex blog that speaks about the Eur/Usd pair each day called thegeekknows.

A Plan for Profit, How to Reward Yourself for Growth as a Trader

Sun, 14 Mar 2010 11:43:11 +0100

A Plan for Profit, How to Reward Yourself for Growth as a Trader.
by Michael "Robinhood" Storm.

Occasionally we are contacted here at winners edge by folks that are having a hard time making consistent gains as traders. Some are really troubled with their performance and concerned because of Losses slowly eating up their precious capital. Often Casey and I have heard similar stories of losses, followed by questions like this: "If I place X amount of money in the market, can I make it as a trader?" We try hard to council these folks, but we often see the same mistakes being made again and again.

One example (names have been changed to protect the guilty), we will call trader Bill. Bill contacted me after loosing over 80% of his account in a rather short time period. My council was lengthy and solid. I thought we had a pretty good plan worked out. Then a week later Bill contacted me again and had more dramatic losses. After going over the plan, I realized that he NOT obeyed what was set out. He did NOT adhere to his end of the bargain. He cheated himself out of potential growth. Once again we went over and over it. He finally agreed to DO what he said he would DO. Will he? I have no idea. I sure hope so. What did I recommend? Lets go over a plan for success for you. If you will DO THIS THING... You will eventually rise to greatness. If you cheat yourself in some way and blow out your account, you will sink to the lows of a million others that have come and gone before you.

Number one, you must realize that Forex (or ANY other form of trading) is a zero sum game. What does that mean? Well, there is only so much "pie" to go around and you are pitted against ruthless sharks that have no concern for you whatsoever. They are NOT willing to let you take money out of there accounts. ONE wins. ONE cries. It is that simple. When you make a successful trade money is transferred OUT of a traders account and INTO yours and vice versa, it is a WAR plain and simple.

Now, if you are going to thrive you must SURVIVE. And that may mean that you should get yourself some serious education. If I KNEW that I was going to go to war in 2 months. I would join a school that could teach me how to be one bad dude and FAST! And I don't want nonsense but REAL tactics. So, education is Numero Uno. Is it not amazing that we will resist spending $40 for a book or a few hundred for some videos, but will think nothing of letting our accounts get smashed for thousands of dollars. Its just not right. So, here is the plan:

Right off the bat. STOP trading in full size lots. Drop down to something more comfortable. For some it may be as low as one micro lot ($1,000) or perhaps an initial position of 3 "lots" of 5,000 each. With the intention of pulling it off in thirds. Why loose with big money? Why not loose small? SHOW ME.... PROVE to me and yourself that you can make money with this small amount first. Then track your performance. When you are CONSISTENTLY profitable daily for an entire week you get to progress to the highly coveted "level 2". Level 2 is 3 "lots" of 10K each, or an initial 30K size. Now, make money with THAT. PROVE it first. You are NOT allowed to go to level 3 until you are CONSISTENTLY profitable every day for a week. If you are having trouble you do not go up. It is that simple. WAIT, until it is as easy as level one. Once you are ready, even if it takes MONTHS of labor, then and only then do you get to rise to the next level. Level 3, Oh yes! now we are really cruising. Level 3 is 3 lots of 15K each= 45,000. Hey that is almost half a standard lot. You can do this. That is your initial position. scale out in thirds as you did for the other levels. Just be consistent. DON"T CHEAT YOURSELF! You'll regret it, trust me you surely will. What do you care if it takes you 4 weeks to get here or if it takes you 6 months??? So what? This is your LIFE you are talking about here. This is your Trading career for the rest of your days, that promotes you to greatness. You will never thrive unless you SURVIVE.

You get the idea. Level 4= 60k in size, level 5= 75K, level 6= 90K and so on and so on. In small incremental size increases, so as not to shock you. What is that voice in the back of your mind saying? Oh, I know exactly what it is, you are thinking this is silly. I am not going to trade with 3 micro lots of just 3,000 ! I cant make any money like that! ( I KNOW that is what you are thinking!) Oh really? So, you can afford to blow through a few grand more this month in being stopped to death by the alligator that is slowly eating you alive? Please. IF.... IF you are struggling and having such a hard time, then I beg you to consider what I say. THIS WORKS ! You will immediately take the pressure off and drop down to something SO small it is ALMOST ridiculous. But it really isn't. You see, this is more important than you realize. This is the golden KEY. Forget about the money, think in terms of PIPS.

Think like this: I need to find a trade that I can get 10 to 30 pips out of. I will scalp the first portion for around 10 pips. Maybe 8 or maybe 12, not really important but I am shooting for 10 to be booked on the first portion. I am shooting for around 15 to 20 on the second, and the third.... well, I will let that one RUN, or stop me out for break even. Now, go and do this as often as you can each day! Can you find 10 trades a day where you can get 10 pips or more? Great! Can you find 20? WOW! even better! DO this, day in and day out and you are on the road to greatness as a trader.

Don't fall for the hype out there.... that you can just trade on 10 minutes or twenty minutes a day, just stroll in and WHAM!!!! pull out 60-80 pips out of the market and you are DONE! That is garbage, pure and simple. The market is NOT going to hand you that without requiring you to have MASSIVE stops and I will have NO part of that. If you don't have time to trade for 4 hours in the morning and 2-3 hours in the Tokyo open, or maybe the first few hours of the European/London session, then you really don't have time to be a trader. Perhaps you should seek someone to manage your account for you.

I challenge you folks that are struggling and eating losses, CHANGE your plan. DO this thing that I have said. Do NOT think it is silly or unworthy. If you really are so great as you think then this little "exercise" should be NO problem for you! This should be a piece of cake for you. You should have NO problem at all going from level one to level 6 in just 6 short weeks. RIGHT? Well? This is what I have to say about it. You just might do it! Perhaps you really will. But the point is this, to get you to STOP losing money or at least slow it down enough so that it doesn't hurt you the way it has been, until you can turn it around, and prove yourself to yourself. OK?

The solution is not throwing more money at it. If your not making it with a 5K account, it will NOT work to place $25,000 into an account and lose it 5 times faster. Trust me. The solution is to get REALLY small and REWARD yourself BIG time by going up REALLY small, each level. The video games that exist in the world... Do they not start you off at level one? Isn't that how it works? If you can survive to each level doesn't it get harder? You really need to think about it this way.

The longer you can sit in front of those charts and observe price action of the market participants and get in tune with the flow of money the better things are going to be for you. Don't rob yourself. If you do this thing, there will come the day, when you are throwing 5 or 10 lots on a perfect setup and taking it for a 20-30 pip move. And these will be some of the happiest days of your life. The life of a market Master! Till Next time. Happy trading!

Trade Alert: USD/CAD

Sat, 13 Mar 2010 15:03:54 +0100

Hi Folks,

Michael "Robinhood" Storm here, Signing in again here with a potential trade set up on the USD/CAD pair...

We have been pretty stacked to the short side on the euro dollar and pound dollar pairs and you know what happens when we get to heavy with the shorts. That's right, there is a possibility of a short squeeze and shakeout happening now. See the charts at the close of thursdays session there were MASSIVE amounts of ascending triangle patterns on all the charts and all the time frames.... HIGHLY indicating we were going higher. And Higher we went, and it looks higher still ! Just a lousy 23.6 FIBO retracement on the daily puts us up another +150 pips on the euro. It is possible. SO, let us look to the USD/CAD

15 Minute Chart *Note Click on the Chart to learn about our premium service.

Here in these charts you can see several things. Notice that CRITICAL daily support has been busted! The circled areas indicate the danger zones. Also look at the FAKEOUT, breakout that happened on Thursdays session:

The circled area is the fakeout breakout. That trapped a lot of people! And what is happening now? A real honest to goodness knife fight. A very bearish looking pattern on the hourly and the 15min indicating to me that we are heading toward PARITY, yes one for one. Or shall I say the potential target on this is 1.0000 Notice the bearish channel between the lines on the hourly and the WRB igniting the move lower. So far we have not even been able to hit the 50% of this mega bearish hourly candle! A real good sign indeed.

SO, watch this Monday and Tuesday, should we break 101.50 we could well have a 100+ pip movement really fast. Specially if the euro and pound squeeze higher. Also consider the possibility of a bounce first. That would be an ideal entry.... to get short in the vicinity of 1.0200 to 1.0220 areas with a stop above 1.0255 Till next time, happy trading !

Free Forex Training Webinar Video

Sat, 13 Mar 2010 14:15:29 +0100

Last week I did a training Webinar and so many people asked for recording, So I have posted it here for anyone who wants to catch up on the Forex Free Training. These are techniques and tips that are taught at our Forex Trading School. This video covers: Trade setups, Exits, trading psychology, risk management, support and resistance and more.

Please leave some valid feedback so that I can improve my videos to help the traders more.

Thanks,

Casey

The "Head Fake", Shelf Break & Retrace.

Fri, 12 Mar 2010 20:14:23 +0100

By Michael Storm aka Robin Hood.

Hi Folks, sorry its been so long since my last article but the trading room has grown and my first responsibility is to those traders that are now a member of our team. We sure do have some boring times. But they are followed by great times to and you have to be waiting for the right setups. Here is an EXAMPLE of a few very common setups that happen just about every day and on just about any given currency pair.

15 Minute Chart *Note Click on the Chart to Learn about our Premium Trading Room.

Please note that on the first chart you can clearly see a GAP, begging to be filled on the 15 min chart of the EUR/JPY. This got extended away from the MA's and we were watching it to retrace. Note that it did not technically set up a 15 min sell setup right away. but made a bit of a shelf where the wicks are (this is more evidenced on the 5 min chart to follow) Then there was a surprise "squeeze" higher that looked like a breakout bar. But it SURE DIDN'T CLOSE THAT WAY! :) This is a headfake, or a bulltrap, if you will. It stopped a bunch of shorts out and faked others to get long.... then went SOUTH in a hurry. :)

We were waiting for the 124.90 level to break, where we all pounced upon it as a short, setting a stop over the 125.12 area. It did not take long for this to go down 25 pips in a heartbeat (almost) at which time we closed it out. It did its job, and filled that Gap. Then you can see it came up to the BOTTOM of that broken shelf and we got short again, same stop. Yeah, it wiggled and jiggled for a while but once it broke the trendline on the 5 min with the WRB SELL SETUP, it crashed again to a very nice level. It actually went further than I thought and I did not catch the entire run I only got about 22 pips of this, I think some of the others in the room held out a bit longer. But wow, what a great trade it was. Notice that it went right for the 200 period MA on the 5 min chart. Awesome.

Be on the lookout for head fakes aka short squeezes. Be on the lookout for shelf breaks, they are a great trade. And lastly be on the lookout for when things get way to far extended away from the MA's... there is a powerful tendency to "snap back" over time, right back into them. But be careful. the first sell setup often fails on a 5 min chart, so either wait for the second or build a position, but always adhere to a decent stop so you don't get crushed. This tendency to pull back into the moving averages has a very high probability of success ratio.

Hope this is a help to some... Please be patient and wait for the quality setups to occur. Till next time, Happy trading !

Eur/Usd: Narrow Price Range Continues

Fri, 12 Mar 2010 02:55:51 +0100

Hello, Traders it is good to be back and I have been away from my posts because the Eur/Usd has not made much price movement and has been stuck in a trading range for quite a long time. In addition I have been recording a trading video series that will be released soon. The series is going to be focusing on Forex Training and many aspects of how to trade profitably, from technical analysis, to news, to psychology and then some.

So anyways the Eur/Usd is in a narrow price range from 1.3690 to 1.3530. When we break out of this channel look for the price to move to the next support or resistance level. The key thing is when will this happen? Timing in Forex Trading is important so you might want to put in entry orders at the top or bottom of these channels so you can make sure that you catch the breakouts.

4Hr Chart * Note Click on the Chart to learn about our premium service.

When trading make sure that you get all the fundamental news because the right news announcement might be exactly what the pair needs to drive it out of this price range. The Forex Crunch is a great place to get all the fundamental data that impacts the market.

Also you can get an additional insight on the Eur/Usd at the The Geek Knows.com

Stop CFTC Petition

Sat, 06 Mar 2010 18:25:16 +0100

There is a petition out there to stop the CFTC regarding the new margin rules requirements. Sign this petion by visiting this link. I personally signed this petition.

http://www.petitiononline.com/stopcftc/petition.html

Here is some information about the implications of the CFTC proposal that I got from Forex Magnates.com

Regarding leverage the implications are these:

Forex brokers and traders will now be able to place deals with maximum 1:10 leverage, meaning that from now on they will have to hold at least 10% of the deal as collateral (margin). This significantly reduces the size of deals that the traders will be able to operate from now on which in turn will reduce their potential gains and losses. CFTC gives exactly this explanation as the reasoning for this new requirements however there is a significant downside to this rule as well: reduced leverage means less profits for more advanced traders who actually CAN handle high leverages and can’t trade otherwise. Additional impact this rule would have on the US industry is that brokers will have their profits slashed as lower size deals mean much lower commission from spread. 2 pip on $100,000 USD worth deal is $20 to the broker, however with 1:10 leverage and same balance the deal size is $10,000 which means only $2 to the broker (how will they pay IBs with such low income is a mystery to me). This will also obviously limit the hedging opportunity for people who actually use these brokers in order to hedge their exposures elsewhere.

Furthermore, this new rule will seriously harm all US brokers and in turn will cause the loss of thousand of US jobs and millions in tax dollars because most of the forex business will either go offshore or will simply disappear or move to other industries such as futures or options (who knowns perhaps this is the real reason behind these new rules). By the way, this is why offshore brokers shouldn’t gloat too much: not ALL the US business will go to them, some of it will simply go to other industries in the US.

And one last thing, the new rule will also potentially halt the Forex industry’s gradual shifting to the ECN/STP execution. Clearing houses are not big fans of small deals and typically won’t accept orders of less than 100,000 USD. So it’s a big question how exactly, and if at all, US brokers will now be clearing trades. My immediate guess is that they will stop doing that, as their risk from smaller sized deals is significantly lower therefore it’s worth keeping the deals in house and profitting from losses. Market Making is about to make a huge comeback.

Regarding Introducing Brokers the blow is even more serious:

Registered Introducing Brokers (IBs) will be able to work with only one (!) broker and will also have to be guaranteed by it. This will reduce the number of IBs to absolute minimum, as Forex brokers won’t be able to guarantee ALL IBs out there, and will only leave a few large powerhouses – this is like your cell network operator will be offering you only one version of a mobile phone. Significantly limiting the competition is never a good thing for the consumer. Most of the IBs will close their business and those remaining will be forced to offer sometimes inadequate solutions to their customers simply because they won’t be able to offer anything else.

I had an interesting conversation with one of my Forex contacts and he suggested that if we all combine forces perhaps we will be able to fight these rules and perhaps change CFTC’s mind on several issues. He suggested to do the following, and I’m joining his effort here asking all of you to do the same:

New Forex Information Portal

Tue, 02 Mar 2010 20:49:01 +0100

There is a new site called Forex Pop which has a composite list of some of the best blogs on Forex Trading. Winners Edge Trading is pleased to be part of the list in which all of our newest posts will be put on the front page of Forex Pop.

This is a page where a forex trader could book mark and then check it each morning to get the best posts from all of the best blogs each day. I think the page is a good idea and will provide value to many forex traders looking for the best information on Forex Trading.

So go and check it out and see some of the best blogs on forex trading. one of my favorite trading blogs Forex Crunch, Forex Blog, Forex4Noobs, Forex Magnates and Baby pips made the list at Forex Pop.

If they missed any good blogs put a comment down below and I will make a suggestion to the author of the site.