Technical Analysis of the Financial Markets: A Comprehensive Guide to Trading Methods and Applications (New York Institute of Finance)

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John J. Murphy has now updated his landmark bestseller Technical Analysis of the Futures Markets, to include all of the financial markets.

This outstanding reference has already taught thousands of traders the concepts of technical analysis and their application in the futures and stock markets. Covering the latest developments in computer technology, technical tools, and indicators, the second edition features new material on candlestick charting, intermarket relationships, stocks and stock rotation, plus state-of-the-art examples and figures. From how to read charts to understanding indicators and the crucial role technical analysis plays in investing, readers gain a thorough and accessible overview of the field of technical analysis, with a special emphasis on futures markets. Revised and expanded for the demands of today’s financial world, this book is essential reading for anyone interested in tracking and analyzing market behavior.

The Pros and Cons of Using Technical and Fundamental Analysis in Forex

There are basically 2 primary methods that Forex traders use to analyze the market. They are technical and fundamental analysis. Pure technical analysts will say that it is impossible to trade on the news, because the market moves so fast and whatever news out there the charts will tell you too. On the other hand, fundamentalists will say that only the news moves the market. Technical indicators are always the followers. So which methods should we use? To find out, let’s look at the pros and cons of both of these methods.

Technical Analysis

Technical analysis involves tracking past currency price movements and use indicators to help identify in which direction the current price may be heading. This analysis can be performed manually or automatically. Under the automated system traders use software (expert advisor) or robot to help them find trades and identify entry and exit points. Technical traders believe that all of the required information needed to place a trade is contained in the charts.

Fundamental Analysis

Fundamental analysis focuses on key underlying economic, financial and political factors to determine the price direction of a currency. Fundamental traders believed that currencies movements, whether it becomes stronger or weaker, are related to the strength of the economy, financial and political situations. Hence, fundamental reports and news are important to them. News and reports such as interest rates, employment, trade balance and GDP are of great…


The Top 3 Pros And Cons Of Forex Technical Analysis

Technical analysis has been a part of financial practice for many decades. It is a method of prediction price movements and future market trends by using chart. It is necessary for you to know the pros and cons of technical analysis so that you can trade with complete ease.

There is no doubt that technical analysis is the easiest and most precise method of currency trading. So, let’s find out the top 3 pros and cons so that you can trade with complete ease.


1. Provides All Current Information

The current price reflects all currently known information about an asset. While rumors may constantly suggest that the price may plummet or surge, ultimately the current price is the balancing point for all information. As investors and traders sway from one side to the other – buyers or sellers – the asset moves reflecting the current perception of value.

2. Prices Move in Trends

If prices just gyrate wildly and randomly it would be very hard to make money. While wild gyrations do occur, overall prices typically move in trends. There is a directional bias to the price which provides traders with an advantage. Much of technical analysis is about determining when a trend is in place, when it isn’t (called a sideways market, range or correction), and when a trend is reversing.

Most profitable trading methods used by traders are trend following strategies. This means you isolate the trend, and then find opportunities to enter in the same direction as the trend, thus capitalizing on the…


Forex Trading – How and Why Prices REALLY Move

How and why do forex prices move? The answer may sound obvious but most traders get the reasons wrong and lose. If you understand the following 3 points, then you will understand more above currency movement and get a head start in your quest for currency trading success.

So how do prices move?

Well of course they move in reaction to all the supply and demand political factors such as: interest rates, government policy, economic health and a whole host of others and these are facts but prices are also influenced by people.

Now all the people who look at the facts see them and have opinions that differ and take positions.

The important point is:

They all draw different conclusions from the facts that they see and this causes prices to go in a different direction to where the bulk of traders think they will!

A simple equation is:

Supply and demand factors + Human opinion (investor psychology) = market movement.

So you need not only to take into account the supply and demand fundamentals but also make a judgment on how other people are going to judge the facts and how they see them and then work out which way prices are going to.

This is why forex trading is hard and 95% of traders fail to win.

So how do you do it and make your forex trading strategy a success?

Here are some tips.

1. Use forex technical analysis as a basis for your forex trading strategy.

Technical analysis and looking at forex charts gives you a distinct edge in that it takes…

Source by Kelly Price

Using a Forex Technical Analysis System

The greatest traders and investors know that you can always win with your portfolio. To do so, it requires a combination of intuition, sense and working with certain systems that show the trends and pivot points in the market. Using a Forex technical analysis system is one of the ways you can begin to change the outcome of your profitability. Understanding how this works allows you to step into new territory for your strategy, all which lead to higher probabilities of a win.

The first concept to look at with a Forex technical analysis is the type of indicator it provides for your system. The first is a lagging indicator, which looks at the past patterns and trends. With this, you can expect to have a continuation of the pattern. However, you will be required to look at the probabilities of change with the trends from this analysis. There are also leading indicators, designed to look at the current patterns to determine what the next trends and patterns will be in the market.

With the Forex technical analysis, you will want to look at how the indicators work for your portfolio. There are different mathematical algorithms and formulas which look at outcomes you are speculating. For instance, oscillators look at the price, volume and time range. These are factored to a mean average to determine the next possible patterns. Candlesticks often work as an analytical tool, using the length of candlestick bodies and wicks to determine the relationship to trends in the market and how…


Making a Mint Via the Forex Forecast

There are various techniques to make a forecast. If you're involved in trading, you already understand that it is the exchange of two different types of currency. You sell one to buy the other. Each trade is really two different trades. The successful trader takes advantage of the exchange rates and tries to find trends in the money market that allows them to monopolize and maximize their return.

If your account is in USD (United State dollars) and you believe the Euro is going to go up in relationship to the dollar, you want to sell the dollar and buy the Euro. The way you write the exchange is EUR / USD buy. The Euro is the base and the USD is the counter currency. If your instructions were buy, you'd buy the Euro and sell the USD. The instructions are always describing the base currency with the counter having the opposite type of exchange. If you ordered a sell then you'd sell the Euro and buy USD.

Forex forecast consists of two different methods. You can use the technical analysis or fundamental analysis. Fundamental analysis forecast with events and how they should affect the market. The technical forecast puts its primary focus on what already occurred within the market. It uses chart to help predict what happens next according to the price movement.

Technical analysis takes the price, the volume and sometimes also interest to create charts. It uses the movement of the past to predict the movement in the future. Much…

Source by Jon Arnold

Technical Analysis & Trends In Forex Trading

Everyone is talking about forex these days, and there are big reasons that explain this huge interest expressed by people all around the world who are willing to learn and enter the world of forex trading. Forex is a huge market with an almost continuous activity all year long, week after week, hour after hour and with the particular characteristic of showing highly marked trends, making it an easily tradable market if you know how to read those trends.

In order to correctly read the forex charts you need technical analysis; this is defined as the study of the price and trading history of a particular currency pair. T.A. stands in the opposite sidewalk to what’s known as fundamental analysis, which is defined as the study of the actual nature and characteristics of the stock or a particular currency in the case of forex. Although some investors combine the two types of analysis in making investment decisions, there are techniques originated from the exhaustive studying of past price charts and trading action during long trading periods that allow the use of only technical indicators in order to have profitable trades.

Technical analysis relies on the empirical evidence to assert that prices do trend. This assumption that prices must trend in the forex market evolution with time is the most important concept in technical analysis.

Technical analysis has many different methods and tools in its arsenal; they all share the characteristic of relying on the assumption that price…

Source by Adrian Pablo

Forex Trading System – The Pros and Cons of Technical Analysis

If you have been involved in foreign exchange trading for any length of time, and whatever Forex trading system you are using, you must have come across the two types of analysis — technical analysis and fundamental analysis. You may well also have noticed that there is a lot of argument between their respecive supporters!.

However, the first thing to emphasize is that the two are not mutually exclusive. The majority of those who are successful in foreign exchange trading make use of both types of analysis.

Technical analysis is a method of predicting price movements and future market trends by using charts to identify what has already happened. It is concerned with actual price movements, not the reasons for them. Fundamental analysis uses more wide-ranging factors such as political or environmental events or anything that could have an effect on currency movements.

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(PRWEB) July 20, 2011

The newly launched website, includes many updated Forex trading features to enhance the user -experience through simpler navigation, clear layout and a new suite of tools. Visitors to the site can open an account, read daily technical and fundamental Forex analysis and access the tools and promotions directly from the homepage. Support and help is available also from the homepage. The site can currently be accessed in English, Turkish, Arabic, Spanish, and French, in order to suit Forex traders from all parts of the globe.

Also part of the main attraction of the new bforex site is its ability to connect traders directly to company promotions, up-to-the-minute market news, and Forex analysis videos available in each of the languages the website features.

The new website displays a sleek new layout sure to make for an enjoyable viewing experience for all traders who visit. The launch of the new bforex website is several months in the making as the company is taking measures to appeal to its ever expanding client base in the Forex market.

Visitors to the site will experience improved access to the main attractions of the bforex brands. Fundamental and technical analysis—written daily, can be previewed and accessed directly from the homepage. Additionally, daily market update videos are also viewable from the homepage, providing its viewers with up to date market analysis upon entering the site. New visitors to the site will also find it easy to access bforex’s wide array of training materials and promotions for new accounts. “We are very excited to present our customers with an improved web experience. We’ll be providing great Forex materials and information in an easy-to-use way that appeals to all Forex traders, no matter their experience level with Forex trading,” said Kate Leaman, Director of Business Development at bforex. What has remained unchanged is that the bforex site provides invaluable guidance for Forex traders, novice or advanced, and continues to push the boundaries of web-based Forex trading.

For Forex traders that have become accustomed to the sleek, user-friendly style of bforex, the new website will be nothing short of an improvement to the style of bforex. With the new look, great tools, and useful information, traders will be thrilled to find a comprehensive trading experience all in one place. For those eager to view everything the new site has to offer, you can continue on to

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Limitations Of Forex trading Technological Assessment

The analysis seeks to forecast long term developments from the past. The proposals place forward are: the news is previously in development and feed-back from consumers and sellers are repeated above time. The observation of the past proves that some graphic figures arise continuously.

A bit of jargon
Like any self-discipline, technical analysis has its jargon. It describes a graph with a metaphor: Bullish candles, head-shoulders, triangles, floors … Alas! Now, candles are blown as they gentle up, heads slide into the shoulders, triangles symbolize not the chance of fracture of supplies, floors give way when they were being touching, the channels have their graphics banks collapse, the latest slide toward the abyss … what is now the conventional imaging chartistes considering the fact that three Oct 2008.

The identical tools for every person
With the democratization of information and facts, most sector players use technical analysis software package that is based on the identical mathematical designs. Supposed to reflect the psychological state of the sector, the form of the curves, the mathematical indicators of above-order or on-sales have develop into, above the decades, a big choice tools. The scoring devices are now ongoing. Managers, functioning in genuine time, practice normally a replica of a passive index.

Absence of hindsight and reflection
It is normally criticized for technical analysis to create its personal predictions. Due to the fact every person appears to be the identical thresholds and figures, they develop into inescapable. In other words, this is not the doggy, the genuine economic climate,…

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