Showing posts with label intraday. Show all posts
Showing posts with label intraday. Show all posts

Forex Myths: Simple vs Complex Strategies

Since I started to learn trading, I heard a lot that "I should keep it simple!". Maybe all of you are familiar with this sentence, but what this really means ?

Based on a healthy trader plan, beginner or not, the right way to start trading a new strategy or system, is to test it on demo for a while, before jumping on the real money account.

So, lets say you are a beginner and learned already the "simple" tools like Trend Lines, Support/Resistances, Channels and Moving Averages. You started by paper trading (history), you tested it on live (but demo) and you decided it's working great. And you started real money account trading with these tools. And it's working. Whats the next step ? Are you gonna stay with this trading style ? From my personal experience, I don't think so.

First of all, it's human nature, to "complicate" things. Second of all, you can't use only the above mentioned tools, forever. Because you will notice is not working all the times. And you will start to wonder why. That is a crucial moment for a beginner trader, because they will jump fast to the  conclusion, that is not working so they will think of changing it completely, with something new and different. Which is wrong, sometimes. Maybe you didn't learn it well, so all you need is to stop trading it on real, go to demo again and don't come back to real, until you will find out what went wrong. Also, you can add other advanced tools to filter your fake signals.

Therefore it doesn't matter if your strategy or system will work or not, you will change/upgrade it, all the time. But the main question is still: How simple you should keep your trading style ?

For those of you that studied my course and/or attended my live classes groups, try to remember that time, when you joined advanced level class. You were starting demo trading for beginners lessons and tools, already, while you were doing paper trading (history) with the intermediate level tools and strategies. Also, when you completed the intermediate, you started to use those intermediate level tools, on live, but still demo. On the next step, you started to use, the advanced tools for paper trading again. But your live trading portfolio already contain beginners and intermediate level tools. And ofcourse, when you finished the advanced level class, you started to use on real, the beginners and intermediate level tools, while you were still practicing demo, the advanced ones.

If you will try to remember your basic charts, from the beginning, you will all notice those tools "looks too simple", for you, now. That is because, many of you are advanced traders right now. And probably some of you, already using the advanced tools, on your real money account.

This is the most logical cycle of learning: getting familiar with the basics, practicing it and using it profitable, in the end.  By working like this, after many years, you will notice a big difference in your trading style, because even advanced tools, are simple for you, today. 

The real problem is when you think, you already reached the advanced level, but you didn't took the right steps and you are using it wrong, even the basic tools. This could happen if you are having a lack of patience in your learning curve.

Simple vs Complex Strategies

By keeping your trading style as simple as can be (efficient), doesn't mean you should stop learning. In trading learning will never stop. It shouldn't. That doesn't mean, that you should try all the possible ideas of all the traders around the web, either. In my point of view it means you should always look for new ways of improving your systems or your trading style. Because you will try to maximize your profits. You want to be more efficient. And since there is no perfect system, you will always try to explain yourself those bad entries signals, exits, etc. This is why we keep the trading journal, right ? Those marks, chart examples and questions, will help us to become better traders, eventually.

Could you ever go back to your previous "simple" tools ? Should you ?

In my way of seeing it, it's not likely to do it. Because when I've decide it to go on real with that tool or system, it means I've tested it for months. So I had a good reason to proceed with it, on the next step: the real trading. Same steps, for upgrading it (adding new tools). So, there's no point for me, to make it simple than that, anymore.

Conclusions

I think this common saying "keep it simple!", is good, mostly for the beginners, due to human nature of complicating things, when they shouldn't. Because in that moment, many think a complicated chart is better. But is not, for them. That's why we say about their charts that looks like "Christmas Trees", when they add tens of oscillators and indicators, that will make them more confused, than helping them. That it is wrong, indeed.

But because some people will remember this sentence, later on, when they reached the advanced level, they will stop learning, thinking "Hey, I should keep it simple!". Which in my opinion is wrong, again. You will never become pro trader like this. You will remain a beginner forever.
(e.q. Remember when you saw my charts, initially ? Remember all you questions about ? How about now, when you already drawing it, almost like me ? Would you stop developing, now ? Would you go back to your "simple" charts, again ?)

Well, ofcourse depends on what do you expect from your trading activity. But don't you ever think, that using only few simple tools, you will have profitable results forever.

Therefore, I think this is a misconception, for most of the traders, beginners or not. In my opinion the right saying should be: "Keep it simple, according to your level!".  And as advanced level trader, don't you ever think "Simple is better!", as long as you know well and you tested properly your "complex" strategy or system.


Best Regards,
^^_Lord_Ice_^^

Forex Myths: Intraday vs Higher Time Frame (HTF)


After reaching a certain level of knowledge, the beginner trader look for a strategy or system, to start his paper trading. Here, in this stage he will take a decision that will haunt him for years. Some people realize it later, some people don't. And they will "run in this circle", for years.

So, this stage can be considered, the first huge mistake, that will change his trading activity for at least a long time, if not forever (Until he will quit trading or keep trying it, but with small results or none). His dilemma is:

Higher Time Frame or Lower Time Frame (Intraday) ?

Due to human nature, most of the people have a lack of patience. In this stage they want to start real trading soon. So they will chose a Intraday strategy for paper trading, then demo and in the end on real trading account. If the beginner would have proper knowledge he would still have to test this strategy for 3-6 months. But again, the lack of patience would make him to consider a shorter period of testing, before starting real trading. This combination of starting Intraday trading, combined with a short period of testing on demo is the most lethal, for the beginners. In my opinion, the fail is close to 100%. ( How many traders, even profitable ones, can say, that they started to have profits from the beginning ? I didn't ! ).

Like I said, the first mistake is choosing Intraday. And this is why I wanted to explain you why, in this article. There is another reason that will make the beginner to choose the Intraday trading (strategy), except his lack of patience for testing. That will be the sellers and all their promo materials. And since the beginners started to learn about trading from their materials, he will be influenced to chose this path.

Lets see...why! And let's take a close look at the real deal of the sellers in this area.


Brokers

As you all know, we can't start trading as a retail trader, unless we are trading using "the third party", the broker services. Also, as you all know, the main income source for the brokers, is the spread.

So, let's do an exercise and see what would be the best deal for a broker:

Let's say he would have a client, that trade on Intraday. Probably will make 10 entries + 10 exits/day at a spread of just 2 pips.

10 x 2p + 10 x 2 pips = 40 pips/client/day/pair

And in 1 month, lets say this client will trade all days, from Monday to Friday:

20 days x 40pips = 800 pips/month/pair

If we will consider this for 1 full lot and aprox $10 for 1 pip...and probably the client will trade many pairs, each day, that must be a good deal...for a broker.

Now, lets see how much will pay a client ( and will earn the broker ), if the client, will trade as a "swing trader" or a trend follower. By trading all month, on HTF, the client will not have more than 10 trades.

10 trades x 4 pips (entry +exit) = 40 pips/month/pair

So an Intraday trader would pay 800pips/month and a Swing Trader would pay...40pips/month (or a Trend Follower on HTF)

Now, what do you think is the best deal for a broker ? An Intraday trader ? Or a HTF trader?

That doesn't mean that a broker want his clients to lose money. They just don't have time for all their clients to learn after the initial contact (phone/e-mail) or to trade HTFs. That broker employee can't go to his boss and say:

"Hey...I've contacted few hundreds of potential clients, this month. They all agree with our services and they will start trading with us...in 6-12 months from now...when they will learn about trading!" If the broker would pay to that employee for 1 year...without having any new clients, he will ruin his business. Also, if they were agree for a monthly commission (from spread mostly), do you think that the broker employee would like to see you doing 10 trades/month, only, when he could have all his clients doing 10 trades/day...?

Imagine a broker that will earn so hard his clients, in months or years, since they practice and start to trade HTF (less profits for the broker) and then, to lose most of them, just because another broker have a new better services. This will ruin the initial example broker business, fast. So he must be able to sign faster the contracts with new clients, even if they will lose most of them in few months (because they'll blow their accounts), since the broker can have more new clients each month.


Introducing Brokers


There are IBs that receive a bonus for opening an account and some don't. But still, for both cases, the broker will pay the IB, a commission from their clients payed spreads.

Usually this commission is around 20- 25% from the payed spread (by the client as trader). So, from those 4 pips/ trade (entry +exit), 1 pip will be the IBs commission. Broker agree to pay this, because that IB, found him a client. The broker would of payed this 1 pip/trade commission to any of his employees.

Now, what do you think is the best deal for a IB since he get a % from the spreads? An Intraday trader ? Or a HTF trader?


Signals Providers

The signals providers charge a monthly fee, for providing to their clients trading signals for their activity. Usually these services fees are around $100-300, for one pair signals or more pairs.

Anyway, lets say you payed $300 and you wait for a signal. Lets say the Signal Provider, wont give you any signal for your payed pair, for...10 days. This could happen, if he would provide you these signals based on HTF analysis. How would you feel to pay a monthly service and to start with 10 days, with no activity ?

Not to mention that this Signal Provider, has the "money back" privacy (as marketing). If they would provide these signals on HTF, they would have tens or hundreds of e-mails/day asking for their payed signals that weren't received yet or money back. Doesn't matter how good are these signals

So, they have to provide you Intraday signals. Because in this way, they can "find" at least few possible entries, starting the first day. If 3 from these "signals" are wrong...they could say: "Hey, but 2 were good! We can't be right all the time! Wait for the next signals!".

They don't care about the quality of their signals. They can always say: "Hey, nobody can be 100% profitable!".  And as long as you receive it daily, you are happier than paying $300 for only 10 signals. And if they'll "ruin" their image...they will start over, under a new "brand" website, ID, etc.

That doesn't mean that a HTF Signal Provider, is good for you. Even if you are profitable with it, you will never know how they do it. So, you'll never learn and you will always be a "client". Not a trader...


EAs/Indicators sellers

Usually the EAs/Indicators are built for Intraday. For HTF are not suited, because you need to keep your trading platform on.

Imagine of keeping your trading computer ON for 2 weeks, just to find few HTF entries using an EA. Is not that comfortable.

Same for a very expensive, Indicator that was built for HFT. You just have to watch it everyday, for hours, hopping to find an entry "confirmation". And it could come for few times/month...


The same situation will be for Strategies Sellers, Trainers and Money Managers (that charge a monthly fee instead a % from profits ) and sometimes even book writers - personal websites with referral links - since all the sellers in this field start their services "portfolio" as a Introducing Broker (for a commissions from spreads), they will  promote Intraday trading. Because is in their best interest to do so.


Conclusions:

As a client, you need to see faster, the results (lack of patience), even if those results are not so good, initially or never.

And instead of promoting HTF (less money for them) for having a bigger % of profitable clients, the sellers prefer to "lose" some clients and replace them with new ones fast, each month.

I'm not saying that everyone will lose money on Intraday. Just, that all the sellers promote it, because Intraday = more money for them. Knowing this, you might wanna think about it, when you want to start you trading activity.

Remember, also, that Intraday "belong" to Institutional Traders ( Trading Companies with with hundred to thousands floor traders, that have way better internet connections than home users and fast news sources - before even posted on newspapers or websites ). You don't want to start your trading carrier here, in this area, as a retail trader (work from your home).

Beginners should start really HTF trading ( ideal Weekly). Then as they'll have better knowledge and experience, they can "lower" the TF. Personally, I found out that W to H1 is the "safest zone" for a retail trader (beginner or advanced one). Specially one that don't want to be +8h/day in front of his computers.


Best Regards,
^^_Lord_Ice_^^

Forex Myths: Seems that everyone is trading, today.

I'm sure everyone searches the web for the info related to trading. We started like this as beginners, in need of a strategy or system. We do it as advanced traders, searching for news, analysis, rapports, etc.

While we are surfing the web, we see a very aggressive advertising campaign, usually promoting services related to trading. We can say this is ok. This is how they look for their clients. Now, since social networking has exploded, we find many people promoting trading.

Some of them claiming they are "traders for living". This can make us believe that everyone is trading today. So who is behind this advertising around the web?  Usually these guys have the "I'm a rich person, I do this just for fun!" attitude, when they promote the "services" (claiming they are real traders).

Another problem starts when this kind of “trader" starts to combine these "services" presented down below and offer you a complete "portfolio" of services, from opening an account to managing it. You will never be a successful trader "working" with these guys. You will just fill the "more than 95% losers" in this field. 

You can spot many of them on Facebook, usually having a "sexy girl" as their profile photo (not more than 3 photos). Just try to read the comments on their photos: "wow, so hot!", "what a beautiful IB/MM, I have!", "thanks for being my friend...you are so sexy!”

First time you notice that, you will make a huge LOL, but if you will try to think more about it...you will start to cry. This is how many poor people are tricked and usually they lose all their money. Me, personally, I would never ever pay for something (service/product), just because a "sexy girl" presents me that offer, but I guess there are lots of poor men out there...

In my country there is a saying: "Is not a fool the one that ask...but the one that pay the ...****! I guess in this case these "traders", that need to sell services to “make a living” from trading, are right, but is this ethical? Is there anyone going to do something about it?

I'd like to believe that there are still fair people out there that promote these services, in an honorable manner. This should be the smart people’s business, not a scammer’s world.


Introducing Brokers
Introducing Brokers are usually promoting their referral links. If you click on these links and register to that broker, they will receive a commission (place your mouse on that link and you will see some strange digits and characters on your Add-on bar, bottom-left on your screen - if you have it activated on your browser) 

This commission can be paid one time only, either when you register as a client or a monthly % from spreads. Until now, it looks good. We can consider IBs as a sales mobile department of a broker, but what if this IB is spamming the web? (E-mail, facebook groups walls, "smart comments" on forums, etc).

Why should I choose this annoying person from all the others thousands of IBs, promoting the same broker? Is he/she going to present me the broker services in a fair way? Does he receive a proper training on how to present the broker services?
The answer is no! If you don't believe me, try to contact a broker that offers IB programs.

No market experience needed (if you mention you have it, is more than enough). No anti-spam policy explained (only mentioned in the contract, but nobody consider it if you report it for any IB), not to mention, no proper training for giving to their clients, proper consultancy.

You should consider it twice, if your brokers offer/allow this kind of promoting. For me, even if they will change their "policy" in the future, I won’t even consider talking with these brokers. (I receive phone calls, e-mails with "business" proposals, every week). There are a few of them that already "look big" on the web, because of this aggressive advertising from IBs.  Unfortunately, as brokers, they offer lousy services!!!


Signals Providers

These services, in my opinion, are the beginner trader’s worst nightmare. Being their clients, you will never learn how to trade. Being successful in this field means you will learn from your mistakes.

How can you learn if you don’t even know the reasons for placing that order on the market?
You will get feed on SMS, e-mail, social networks, with some "signal": buy here...exit there.  If they are right...you don't understand how. If they are wrong, you lose more than money: You will lose more than that. You will lose the opportunity to learn from that bad trade, not to mention, you will never "learn how to catch your own fishes". You will always depend on that "service" for as long as you will live...

Now, this "gang" is gathered on big websites that promote "performance links". This is another "trend" in this field. This is also a great IB business for the websites owners. To keep their "performances links" in place for more than a month, they have to open their real account on that website (referral link), yet, this is something that everyone forgets about:

"Past Results Do Not Guarantee Future Profits!"


And the worst part...I notice everyday, "known" traders around the world starting their own "signals services" business, instead of funding a company with shareholders, to invest on the market.
I find that so LAME...


Forums Traders


The beginning was great. I still remember those days, when there were few fair forums on the web. A nice place where you could talk, share your results, learn from advanced traders, and learn from their mistakes...

Those days are gone...and will never be the same again. Now forums have advertising contract and write articles for paid advertising, become IBs (sharing referral links) or started "performance links" business...

The forum traders now, are mostly beginners. They read a few things and tested it on demo and...Done. They are now "gurus" and teach trading! Every forum you might join, have thousands of threads opened...with different strategies and systems that had thousands of followers posting every day...charts, results...until eventually they stopped doing that and the thread was closed...Why ? Doesn't it work anymore?

Then the old followers become "gurus" and take the idea and start a new thread posting old links: "this is the original idea...and we are just improved it and end up with this...” And this...usually stop earlier than the original idea, because they don't have enough followers and expected results...

Then there is the "forum trader", thinking of starting his own "business"...by making his own forum. This is how all the forums around the web now have the same ideas (sometimes just copy+paste) from the FF Forum...the first great place...  This is how, learning from the web, today (for free), in 80% of cases is just a lost time...Sometimes money, too, if you open a real account without months of demo testing, before. And by testing all ideas shared on the web today...could really take you years...
So they thought: It is either you have time to get proper training in this field...or money to lose to buying other’s "experience". Sometimes it is both. I'm sure many of you, have a "deja vu" by reading this.

Advanced traders are no longer on the web, sharing for free, their experiences. They are "hidden", now, due to this "big noise" about the trading, everywhere.
Years ago, an advanced trader didn't have to "show" his statements. It was enough for us that he could answer all our questions, with lots of most logical details, for free. Also, when having lots of money in your account, you will start to think of personal security...so no real names, no other details.

Hey, have any of you seen the Warren Buffet "performance link”? How about his investor password? How about George Soros? Any other big trader's statements? :) I can assure you...you won’t see it! If a fair big trader what to share his results will build a company with shareholders, to invest on the market. (Like Warren Buffet did with Berkshire Hathaway Inc.)

Back then, when beginners were happy about results, they wanted to "show off" a bit and they were publishing their results (less than $ 50k). Now all beginners with few hundreds in their account "show off" with their statements to earn clients. Why? Their system is not working that good to "trade for living”?

This category represents that 80% noise...that will stop soon and they will vanish (when their "system" will stop working like on FF Forum, years ago). But new ones are coming...so watch out of these "show off" guys! They are not yet traders. They are just...beginners with some results. They are "forum traders"...


Strategies Sellers

If you can trade profitable, you can make millions, by starting with few thousands. Why should this trader allow this "stress" of having clients, for few thousands/month, only?
They are "forum traders" that had some results...but not enough. Why do I think this way?

It is simple: How much money can you make, by starting with $1 and having 100% profit (ROI), in 30 days?
Do the math for yourself. You don’t have to make 100% and you shouldn’t count days. Months or years will do, to have millions. Not to mention you don't have to start with $1...

So every time you meet a trader selling a strategy ask yourself this:

If it is that profitable, why does he/she sell it?
And why is it so cheap?

Would you sell a strategy that can get you millions?
How much money would you ask for it?


The web is full with these "successful strategies" with only $ 99.9! And when it comes to results...the monthly profit is between 99.9%-999999999% :)

So they built "good looking" websites and sell you the success in "just one click". Also, they have great reviews (fake ones) as comments (or now the upgraded versions of advertising it: many small websites around the big one, with fake communities, reviews, etc)

"What are you waiting for? Get it now with $99!!!"

I'm sure that many of you have a "deja vu", again... :)


EAs/Indicators Sellers

Ohh...what sweet memories. These products started few years ago, when if you were visiting a forum and you dare to talk about your strategy, the first comment would have been "Sounds great man! Can you share with us the EA? Please, please, please...” If you didn’t have one...you should have felt ashamed of yourself as a trader and run away crying to look for a programmer to build it fast :)
Today, we must agree automated trading is the best, but since you dont have a bank/hedging company EA to buy...why bother? All the other products on the market are just...
Why? Remember this?

If it is that profitable, why does he/she sell it?
And why is it so cheap?

Would you sell a EA that can get you millions?
How much money would you ask for it?

This product is also sold by beginners or unprofitable yet traders. Most of them are not only claiming they are traders. They say they have 10y market experience. This is how they got the strategy and worked really hard to build the EA. If you ask them how old they are...25 seems their lucky number :)
(So they started trading at 15y)


Book Writers

There are good books in this field. But also some that will make you to waste your time...and money.

By searching the eBay for some good new books, I wanted to know more about the writer of that "good book" I was watching, for sale $20 or something. I’ve checked the reviews...lots of positive ones. The good part came when I clicked on the writer ID to see other books he writes about. He turned out to writes good books also, about: cooking, gardening, paintings, sculpting, travel, etc....and trading.... :)

Also, if you will check some "great writers" books at the bibliography of book you will find out their "source" was many other good books. So nothing new...copy+paste like on forums (ofcourse edited with his own words - copyrights laws).

Therefore to find a good and helping book about trading, today, is really a challenge. Me personally, I've read thousands...and I must say less than 20% were good. The rest  were such a waste of good night's sleep...

That's why I can call trading "books selling" just the upgraded version of the "forum trader", when some beginners think they can "make some money fast", while advanced traders, use the marketing tricks to "write a new book", that doesn't necessary share something new or unwritten until now. So, most of them just "sell" their personal brand, not the books value...And I am really disappointed about my old "idols"...new books.


Trainers

You know how they say: "If you can't trade...teach!"

So, why should you pay for a trainer ...in trading? For his spent time with you?
Shouldn't he consider this as something to "give back to this field”?

And if his lessons are free around the web...and he can't trade successfully...what am I actually paying? Probably they think they teach you "how to do it". Yet, they fail to do it...for themself...if they charge you for this.

Some say that they like ...to travel. So this is the best way to travel for free...When I hear this "starting joke" at some courses...meetings, I leave immediately. To think of it, to say it in front of other people, when you pretend you are a trader...This is so LAME, again...

Yet, there are lots of "gurus" around the web. Usually they claim they are successful traders...And have some brilliant description "Best trainer in the..." or "The most beloved trainer in the ..."
Who gave him this ...title? Himself!

But I have to agree, there are some great courses out there. But how many of you payed some courses...that didnt helped you at all, as trader? "Deja vu", again? :)

I've attended many courses in my life. Few related to trading. And I must admit, most of them didn't offer me new knowledge. Mostly, these courses can be helpful for your...moral. But for this you shouldn't pay hundreds or thousands of dollars...

Finding a good course can be again, a challenge. All websites have payed "advertising": articles, forum comments, social networks, etc. So, finding decent reviews is hard. I started to think that friend’s reviews are the most trusted opinion. But this also turned out to become a "referral" business, (like in MLM "businesses" that made friends avoid contact with other friends that already "joined the system", because they can't stop "recommending it"...for a commission...).


Money Managers

By the book, a MM is a person that manages their client’s accounts. And yes, these MM should be traders. The problem is that every one is claiming around the web that he/she is a Money Manager.

I'm sure that my follows already know the TV Show (best documentary) "Million Dollars Traders!" produced by BBC. The purpose of the documentary was to find out if some persons with no previous knowledge about the market can become traders. Why? Because the Fund Manager, used to hire people with "experience" and not all of them...were profitable. They admitted that finding good traders is hard, because good ones trade for themself. And those that are willing to join don't come for a monthly salary, but for a big commission...which is not that good for their business. So they tried over the years to train traders. Again, after teaching them to trade profitable, they were leaving for building their own business...or carrier. :)

So if a big trader, does he chose to not become employee but decided to work for himself, as trader (or for his own company), why does he need clients?

Today, people are mistaken a MM with a "signal provider" that share his trades with a "trade copier" software.

In my opinion the definition by the book for MM, should be for institutional traders, only.

And a Private MM, should be able to teach you a strategy/a system (without being a strategy seller), then to be able to guide you (without charging for teaching) and then to become your mentor when you start to enter on the market (not to "share" his own trades using a "trade copier" or to sell you signals). And yes for this he might charge a monthly commission, when you have profits.

Why?  Well, he tells you how to do it...shows you how to it...and you are doing it, eventually, with his help. Working like this with a good MM, can help you become a trader yourself, eventually, in 1-2 years, but after that, you can trade for yourself, without paying thousands of dollars for books, courses, etc.  So this can save you money and ...time.

But finding again a good MM, is really a challenge. Especially now with these "performance links" websites, that claim they show you MMs. Yet, they are nothing but, signal providers.  They won’t teach you how; they will just "share" their trades with you...as long as you will pay for it. And even if you find a good one, if he will stop, someday, you must search all over again. Because you wont be able to trade for yourself. Not to mention not using their money, doesn’t represent a guarantee. They can fund their account with $100 and they can have $1 mil from their clients. If he loses that $100, he will just make a new account :)

That's why, I also agree with good traders, as MM, that builds their own company using shareholders as long as they can fund 51% from the trading budget. People that can't trade, they can be partners on a trading company that uses their money for trading on the markets- like a Hedging Company. If the MM is not good enough he will lose his money too (as an extra guarantee).


Conclusion:


As you can see, there are many sellers in this field, on the web. Not all are traders. I think there are more sellers than traders. Is hard to make this statistic, because I don't think all of them will admit it.

I let you to be the judge of that. Just watch the posts on trading groups on Facebook, forums, etc. And tell me who is really sharing something for free. How many of these free services do you consider useful and how many can be consider "marketing tools" for these services. Not to mention that I know good free sources on the web that aren't free...anymore.


Best Regards,
^^_Lord_Ice_^^

How to setup your Fibonacci Retracement to show price on each level on MetaTrader 4 ?

Here is a simple trick that will show price near every level from your Fibonacci Retracement tool:

1. Draw your fib to the chart ( for example from the top to the bottom )
2. Double click on the "Common Line" ( connect levels from top to bottom, for example )
3. Right click on the selected Fibonacci Retracement + Properties.
4. Select "Fibo levels" from menu.
5. At "Description" add near the levels "= %$" (you can put 2 x space before that = to see it more clear)



Now your drawn Fibonacci Retracement tool will show the price on each level like this:



Now you don't have to check the price everytime, using your "Crosshair" tool, cause price apear next to the fibs levels.


Best Regards,
^^_Lord_Ice_^^

"1-2-3-4" - Reversal Pattern ( Price Action Trading )

This reversal pattern can be found at the end of the trend if:

1. TL is broken.
2. PA failed to make HH ( for Sell ) or LL ( for Buy ).
3. BO of 2 ( confirmation that the trend is changed ).





This is a Price Action Strategy and for better understanding this you should check this strategy, too: Swings Trading ( Price Action Trading )


Lets see an example on the chart:



In our example, we have a retest of the BO of 2 level, but it doesn't happend all the time. That's why for proper trading this strategy, you can use only 1 pending order, Buy Stop/Sell Stop at the Break Out of 2.

SL can be @ 3, but also you can use a more relaxed SL, below 1 level.
For TP we project the same distance in pips, as between 1 and 2 level.


Best Regards,
^^_Lord_Ice_^^


Swings Trading ( Price Action Trading )



Swings ( waves ) are PA formations, described as an impulse, followed by a correction, during trends and counter trends. Every trend have ups and downs (swings ).

Best way to see the swings, is to draw them manually, connecting with lines the Higher Highs and the Lower Lows.



Now all we have to do is to mark the swings:

HH = Higher High
LL = Lower Low
LH = Lower High
HL = Higher Low



So for an UP Trend ( bullish ) we will have swings:

LL-HH-HL-HH-HL...

And for a DOWN Trend ( bearish ) we will have swings:

HH-LL-LH-LL-LH...

So based on the swings and PA, we might use the next strategies:

1. Trend Lines BO 

2. Support & Resistance Lines ( S/R Lines )
3. Channels

For trading the swings, SL should always be a large one ( previous HH or LL ).


Best Regards,
^^_Lord_Ice_^^





Moving Averages ( MA, SMA, EMA )


A Simple Moving Average is the average of a series of prices, over a period of time which is constantly updated by dropping the oldest value and then adding the newest value and recalculating the average.

For Exponential Moving Average, the formula is changed and the last prices count more than the oldest ones.

MA is used for trading, as a "mobile" Trend Line or S/R Line ( range market ), because every time a new candle is closed the "line" is drawing that change in PA.

Also, MAs, even if there aren't used as crossing strategy, can be used as trend indicator ( like a TL, adjusted every time a new candle is formed ).

There are many ways we can use it as trading strategies, too.

1. One Moving Average BO

For example we can use 50 SMA, like this.



1. Always use the direction of the MA to establish trend for swing
2. When 50 SMA point UP, look to BUY only, when 50 SMA point DOWN look to SELL only.
3. After trend is confirmed ( SMA pointing UP or DOWN ), you can open a buy ( in our example ), after PA closed above 50 SMA. SL would be the LL of the candle that made the BO or the previous LH ( we are in a uptrend now ).
4. After that, you can add more positions ( BUY ) on every retest that failed to break below 50 SMA or other crossing ( from below-above ) between PA and 50 SMA. SL would be previous LH or the LL of the candle that made the BO (crossed the 50 SMA ).

2. Two or more Moving Averages Crossing

This is the common use of MAs for trading. For example we can use 20 SMA, 100 SMA, like this.



1. Previous down trend is over, 20 SMA crossed above 100 SMA, we look to BUY opportunity.
2. PA retested the SMA 100 = BUY, SL would be @ previous LL.
3. Candle closed above 20 SMA, you can also BUY , the next candle opening. SL would be @ previous LL.
4. After the BO of the new formed HH, move the SL to next HL ( our entry ) until BE, or use trailing stop.
5. You can also add more BUY positions on every crossing UP ( 20SMA over 100 SMA ), or new closed candle above 20 SMA ( when changing directions again from pointing DOWN to pointing UP - rejection from 100 SMA)

In this way you can also add the 3rd SMA and add positions to the crossing of first 2 ( 20 and 50 ) and use SMA 100 for trend direction confirmation.



If in this example, 20 and 50 SMA, cross below 100 SMA, the long trend is over and we look for sell opportunities only.

3. Moving Averages and TL or S/R Lines

As I said, MAs are also good for indicating ( pointing ) the main trend.



But another way you can use 50 SMA is to confirm BO. One of the best ways to do it is to trade TL's BO on the main swing trend like this.



To read more how to setup the trades using TL's BO systems, SL and TP, go here.


4. 200 EMA using multi TF


This is one of the best trading strategies. Very simple and yet so effective ( you will never be against the trend ).



1. Daily chart, PA is below 200 EMA
2. H4 chart, PA is below EMA
3. M15 chart "bucking" the trend and must also go below 200 EMA.
4. For filtering the entry, on M15, you can use Stochastic oscillator crossing from top to bottom ( crossing 80% - oversold level )
5. SL would be previous @ LH ( down trend ).


Best Regards,
^^_Lord_Ice_^^


Channels



Channels are basically 2 parallel TL drawn on the chart, that contain LL and HH of PA's last swings. There are many ways to trade channels.

1. The common use of channels is to trade it as Trend Lines BO or Pullback ( rejection ).


2. Also, when the formed channel is horizontal we can trade it as S/R Lines BO or Pullback ( Rejections ).



3. BO Boxes Channel Trading Strategy

After we found a channel on higher TF we can lower the TF to M30 to find our first BOX. Then we can use it to keep add positions or to move SL until BE.



Also using same technique with boxes, you could of predict the drawn channel forming since beginning. All you have to do is to find first pullback and make a box of it.



Sl would be opposite BOX direction. You can add positions, move SL ( BE ) when it's BO of the BOX, or use Trailing Stop = BOX pips. ( HH-LL ).

From my experience this work better on London's opening and no important news in that day for the pair you trade.



Best Regards,
^^_Lord_Ice_^^

Support & Resistance Lines ( S/R Lines )

Support & Resistance Lines ( S/R Lines ) are horizontal lines connecting at least 2 previous HH or LL of PA on the chart.



To draw S/R Lines we can use HH/LL or close price, as our R Line from the chart above.

The common mistake of trading these S/R Lines, is to consider them ...lines. S/R Lines are actually Zones.

Normally second R Line is a LH on the chart ( is a resistance when we connect at least 2 previous HH/LL ).




In this example using zones, we could connect our second R Line with previous LL/HH. ( since there are sometimes 10p-20p difference, between those levels ). Using only a line we can't connect them properly.
 
Every broken Support, becomes Resistance and every Resistance broken, becomes Support.

There are many ways to trade S/R Lines.

1. S/R Lines BO Strategy.

After a candle broke a S/R Line and close below you can entry on the next candle opening, with a SL above the candle's high ( our example is a short one ).



For TP you may use Trailing Stop, BE ( moving SL after each further BO ) or find the next Support Zone pullback. ( rejection ).

2. S/R Lines Pullback Strategy ( rejections )

If you look carefully at our previous chart, you will see that was a false BO of the S Line on the bottom of the chart. If we would of drawn a Line, we might of trade it as a BO of S Line.

But since we've considered a S Zone ( connecting the last previous low and the last one ), we look for a candle to close above to entry. ( rejection )



3. S/R + TL BO Strategy


An interesting idea of trading S/R Lines is to combine it with TL.





For trading it like this all we have to do is to lower the TF ( we used H4 and now we entry on H1 - for proper entry and a tight SL ).


4. Pending Order @ Retest previous BO of S/R Strategy

This is one of the best and yet simpliest trading strategy I've ever found.




Ypu can use pending order for this ( after previous BO ), or use rejection from R Zone.
Your SL would be @ new formed HL. For TP you can use previous LL, BE or Trailing Stop.


Best Regards,
^^_Lord_Ice_^^

Trend Lines I ( TL )

A Trend Line is formed by a diagonal line, connecting at least 2 pivot points ( HH or LL ).





I know there are many traders that draw these TL between closing/opening price, but I prefer to draw them by connecting HH/LL. ( with some exceptions when starting with 2 HH/LL and the next taps are fake BO's of the TL ).

So there are many ways of considering an entry using TL.
1. TL's 3rd tap strategy 

Considering an entry by waiting another touch of this TL ( also known as "3rd tap").

If the candle touched the TL and didn't closed below, in our example ( fail to break ), we can open a long position on the next candle open area. SL would be @ previous HL and TP @ previous HH, or Trailing Stop.





For exit you may also use opposite TL broken like in the next example.

2. TL's BO Strategy.

Another common use of trading the TL is to trade the BO.





As you can see in our example, we have 3 opportunities to enter the trade:

Entry 1 - @ retest ( pullback ) of the broken TL.
Entry 2 - @ new formed "HL" of the PA.
Entry 3 - @ the real "HL" of the PA ( since the PA failed to break the HH and formed a LH in top of the chart )

For exit the trade we may consider Trailing Stop or the opposite TL BO.




PA also failed to BO the LL of the chart ( forming a double bottom ) that offer a great exit opportunity. But normally we can use the BO of bearish TL.

3. TL's BO Strategy, following the main trend

Drawing a TL on a higher TF like H1, then lowering the TF to M30, offer us many entry opportunities in the same direction of the main trend.




SL for all those entries might be the BO candle lowest or the last swing HL ( since we have a bullish trend in our example ).


Best Regards,
^^_Lord_Ice_^^

Elliot Wave Principle

The Elliott Wave Principle is a form of technical analysis that some traders use to analyze financial market cycles and forecast market trends by identifying extremes in investor psychology, highs and lows in prices, and other collective factors. Ralph Nelson Elliott (1871–1948), a professional accountant, discovered the underlying social principles and developed the analytical tools in the 1930s. He proposed that market prices unfold in specific patterns, which practitioners today call Elliott waves, or simply waves. Elliott published his theory of market behavior in the book The Wave Principle in 1938, summarized it in a series of articles in Financial World magazine in 1939, and covered it most comprehensively in his final major work, Nature’s Laws: The Secret of the Universe in 1946. Elliott stated that "because man is subject to rhythmical procedure, calculations having to do with his activities can be projected far into the future with a justification and certainty heretofore unattainable." The empirical validity of the Elliott Wave Principle remains the subject of debate.



Overall design

From R.N. Elliott's essay, "The Basis of the Wave Principle," October 1940.


The Elliott Wave Principle posits that collective investor psychology, or crowd psychology, moves between optimism and pessimism in natural sequences. These mood swings create patterns evidenced in the price movements of markets at every degree of trend or time scale.

In Elliott's model, market prices alternate between an impulsive, or motive phase, and a corrective phase on all time scales of trend, as the illustration shows. Impulses are always subdivided into a set of 5 lower-degree waves, alternating again between motive and corrective character, so that waves 1, 3, and 5 are impulses, and waves 2 and 4 are smaller retraces of waves 1 and 3. Corrective waves subdivide into 3 smaller-degree waves starting with a five-wave counter-trend impulse, a retrace, and another impulse. In a bear market the dominant trend is downward, so the pattern is reversed—five waves down and three up. Motive waves always move with the trend, while corrective waves move against it.

Degree

The patterns link to form five and three-wave structures which themselves underlie self-similar wave structures of increasing size or higher degree. Note the lower most of the three idealized cycles. In the first small five-wave sequence, waves 1, 3 and 5 are motive, while waves 2 and 4 are corrective. This signals that the movement of the wave one degree higher is upward. It also signals the start of the first small three-wave corrective sequence. After the initial five waves up and three waves down, the sequence begins again and the self-similar fractal geometry begins to unfold according to the five and three-wave structure which it underlies one degree higher. The completed motive pattern includes 89 waves, followed by a completed corrective pattern of 55 waves.

Each degree of a pattern in a financial market has a name. Practitioners use symbols for each wave to indicate both function and degree—numbers for motive waves, letters for corrective waves (shown in the highest of the three idealized series of wave structures or degrees). Degrees are relative; they are defined by form, not by absolute size or duration. Waves of the same degree may be of very different size and/or duration.

The classification of a wave at any particular degree can vary, though practitioners generally agree on the standard order of degrees (approximate durations given):

    Grand supercycle: multi-century
    Supercycle: multi-decade (about 40-70 years)
    Cycle: one year to several years (or even several decades under an Elliott Extension)
    Primary: a few months to a couple of years
    Intermediate: weeks to months
    Minor: weeks
    Minute: days
    Minuette: hours
    Subminuette: minutes

Elliott Wave personality and characteristics

Elliott wave analysts (or Elliotticians) hold that each individual wave has its own signature or characteristic, which typically reflects the psychology of the moment. Understanding those personalities is key to the application of the Wave Principle; they are defined below. (Definitions assume a bull market in equities; the characteristics apply in reverse in bear markets.)

Five wave pattern (dominant trend)

Wave 1: Wave one is rarely obvious at its inception. When the first wave of a new bull market begins, the fundamental news is almost universally negative. The previous trend is considered still strongly in force. Fundamental analysts continue to revise their earnings estimates lower; the economy probably does not look strong. Sentiment surveys are decidedly bearish, put options are in vogue, and implied volatility in the options market is high. Volume might increase a bit as prices rise, but not by enough to alert many technical analysts.

Wave 2: Wave two corrects wave one, but can never extend beyond the starting point of wave one. Typically, the news is still bad. As prices retest the prior low, bearish sentiment quickly builds, and "the crowd" haughtily reminds all that the bear market is still deeply ensconced. Still, some positive signs appear for those who are looking: volume should be lower during wave two than during wave one, prices usually do not retrace more than 61.8% (see Fibonacci section below) of the wave one gains, and prices should fall in a three wave pattern.

Wave 3: Wave three is usually the largest and most powerful wave in a trend (although some research suggests that in commodity markets, wave five is the largest). The news is now positive and fundamental analysts start to raise earnings estimates. Prices rise quickly, corrections are short-lived and shallow. Anyone looking to "get in on a pullback" will likely miss the boat. As wave three starts, the news is probably still bearish, and most market players remain negative; but by wave three's midpoint, "the crowd" will often join the new bullish trend. Wave three often extends wave one by a ratio of 1.618:1.

Wave 4: Wave four is typically clearly corrective. Prices may meander sideways for an extended period, and wave four typically retraces less than 38.2% of wave three (see Fibonacci relationships below). Volume is well below than that of wave three. This is a good place to buy a pull back if you understand the potential ahead for wave 5. Still, fourth waves are often frustrating because of their lack of progress in the larger trend.

Wave 5: Wave five is the final leg in the direction of the dominant trend. The news is almost universally positive and everyone is bullish. Unfortunately, this is when many average investors finally buy in, right before the top. Volume is often lower in wave five than in wave three, and many momentum indicators start to show divergences (prices reach a new high but the indicators do not reach a new peak). At the end of a major bull market, bears may very well be ridiculed (recall how forecasts for a top in the stock market during 2000 were received).

Three wave pattern (corrective trend)

Wave A:
Corrections are typically harder to identify than impulse moves. In wave A of a bear market, the fundamental news is usually still positive. Most analysts see the drop as a correction in a still-active bull market. Some technical indicators that accompany wave A include increased volume, rising implied volatility in the options markets and possibly a turn higher in open interest in related futures markets.

  
Wave B: Prices reverse higher, which many see as a resumption of the now long-gone bull market. Those familiar with classical technical analysis may see the peak as the right shoulder of a head and shoulders reversal pattern. The volume during wave B should be lower than in wave A. By this point, fundamentals are probably no longer improving, but they most likely have not yet turned negative.

Wave C: Prices move impulsively lower in five waves. Volume picks up, and by the third leg of wave C, almost everyone realizes that a bear market is firmly entrenched. Wave C is typically at least as large as wave A and often extends to 1.618 times wave A or beyond.

Pattern recognition and fractals

Elliott's market model relies heavily on looking at price charts. Practitioners study developing trends to distinguish the waves and wave structures, and discern what prices may do next; thus the application of the wave principle is a form of pattern recognition.

The structures Elliott described also meet the common definition of a fractal (self-similar patterns appearing at every degree of trend). Elliott wave practitioners say that just as naturally-occurring fractals often expand and grow more complex over time, the model shows that collective human psychology develops in natural patterns, via buying and selling decisions reflected in market prices: "It's as though we are somehow programmed by mathematics. Seashell, galaxy, snowflake or human: we're all bound by the same order."



Elliott wave rules and guidelines

A correct Elliott wave "count" must observe three rules:

    Wave 2 always retraces less than 100% of wave 1.
    Wave 3 cannot be the shortest of the three impulse waves, namely waves 1, 3 and 5.
    Wave 4 does not overlap with the price territory of wave 1, except in the rare case of a diagonal triangle.

A common guideline observes that in a five-wave pattern, waves 2 and 4 will often take alternate forms; a sharp move in wave 2, for example, will suggest a mild move in wave 4. Corrective wave patterns unfold in forms known as zigzags, flats, or triangles. In turn these corrective patterns can come together to form more complex corrections.

Fibonacci relationships

R. N. Elliott's analysis of the mathematical properties of waves and patterns eventually led him to conclude that "The Fibonacci Summation Series is the basis of The Wave Principle". Numbers from the Fibonacci sequence surface repeatedly in Elliott wave structures, including motive waves (1, 3, 5), a single full cycle (8 waves), and the completed motive (89 waves) and corrective (55 waves) patterns. Elliott developed his market model before he realized that it reflects the Fibonacci sequence. "When I discovered The Wave Principle action of market trends, I had never heard of either the Fibonacci Series or the Pythagorean Diagram".

The Fibonacci sequence is also closely connected to the Golden ratio (1.618). Practitioners commonly use this ratio and related ratios to establish support and resistance levels for market waves, namely the price points which help define the parameters of a trend.  See Fibonacci retracement.

Finance professor Roy Batchelor and researcher Richard Ramyar, a former Director of the United Kingdom Society of Technical Analysts and Head of UK Asset Management Research at Reuters Lipper, studied whether Fibonacci ratios appear non-randomly in the stock market, as Elliott's model predicts. The researchers said the "idea that prices retrace to a Fibonacci ratio or round fraction of the previous trend clearly lacks any scientific rationale". They also said "there is no significant difference between the frequencies with which price and time ratios occur in cycles in the Dow Jones Industrial Average, and frequencies which we would expect to occur at random in such a time series".

Robert Prechter replied to the Batchelor–Ramyar study, saying that it "does not challenge the validity of any aspect of the Wave Principle...it supports wave theorists' observations," and that because the authors had examined ratios between prices achieved in filtered trends rather than Elliott waves, "their method does not address actual claims by wave theorists". The Socionomics Institute also reviewed data in the Batchelor–Ramyar study, and said these data show "Fibonacci ratios do occur more often in the stock market than would be expected in a random environment".

It has been suggested that Fibonacci relationships are not the only irrational number based relationships evident in waves.

After Elliott

Following Elliott's death in 1948, other market technicians and financial professionals continued to use the wave principle and provide forecasts to investors. Charles Collins, who had published Elliott's "Wave Principle" and helped introduce Elliott's theory to Wall Street, ranked Elliott's contributions to technical analysis on a level with Charles Dow. Hamilton Bolton, founder of The Bank Credit Analyst, provided wave analysis to a wide readership in the 1950s and 1960s. Bolton introduced Elliott's wave principle to A.J. Frost, who provided weekly financial commentary on the Financial News Network in the 1980s. Frost co-authored Elliott Wave Principle with Robert Prechter in 1978.

Rediscovery and current use

Robert Prechter came across Elliott's works while working as a market technician at Merrill Lynch. His prominence as a forecaster during the bull market of the 1980s brought the greatest exposure to date to Elliott's work, and today Prechter remains the most widely known Elliott analyst.

Among market technicians, wave analysis is widely accepted as a component of their trade. Elliott's Wave principle is among the methods included on the exam that analysts must pass to earn the Chartered Market Technician (CMT) designation, the professional accreditation developed by the Market Technicians Association (MTA).

Robin Wilkin, Ex-Global Head of FX and Commodity Technical Strategy at JPMorgan Chase, says "the Elliott Wave principle ... provides a probability framework as to when to enter a particular market and where to get out, whether for a profit or a loss."

Jordan Kotick, Global Head of Technical Strategy at Barclays Capital and past President of the Market Technicians Association, has said that R. N. Elliott's "discovery was well ahead of its time. In fact, over the last decade or two, many prominent academics have embraced Elliott’s idea and have been aggressively advocating the existence of financial market fractals."

One such academic is the physicist Didier Sornette, visiting professor at the Department of Earth and Space Science and the Institute of Geophysics and Planetary Physics at UCLA. In a paper he co-authored in 1996 ("Stock Market Crashes, Precursors and Replicas") Sornette said,

    It is intriguing that the log-periodic structures documented here bear some similarity with the "Elliott waves" of technical analysis ... A lot of effort has been developed in finance both by academic and trading institutions and more recently by physicists (using some of their statistical tools developed to deal with complex times series) to analyze past data to get information on the future. The 'Elliott wave' technique is probably the most famous in this field. We speculate that the "Elliott waves", so strongly rooted in the financial analysts’ folklore, could be a signature of an underlying critical structure of the stock market.

Paul Tudor Jones, the billionaire commodity trader, calls Prechter and Frost's standard text on Elliott "a classic," and one of "the four Bibles of the business":

    [Magee and Edwards'] Technical Analysis of Stock Trends and The Elliott Wave Theorist both give very specific and systematic ways to approach developing great reward/risk ratios for entering into a business contract with the marketplace, which is what every trade should be if properly and thoughtfully executed.

Criticism

The premise that markets unfold in recognizable patterns contradicts the efficient market hypothesis, which states that prices cannot be predicted from market data such as moving averages and volume. By this reasoning, if successful market forecasts were possible, investors would buy (or sell) when the method predicted a price increase (or decrease), to the point that prices would rise (or fall) immediately, thus destroying the profitability and predictive power of the method. In efficient markets, knowledge of the Elliott Wave Principle among traders would lead to the disappearance of the very patterns they tried to anticipate, rendering the method, and all forms of technical analysis, useless.

Benoit Mandelbrot has questioned whether Elliott waves can predict financial markets:

    But Wave prediction is a very uncertain business. It is an art to which the subjective judgement of the chartists matters more than the objective, replicable verdict of the numbers. The record of this, as of most technical analysis, is at best mixed.

Robert Prechter had previously stated that ideas in an article by Mandelbrot[16] "originated with Ralph Nelson Elliott, who put them forth more comprehensively and more accurately with respect to real-world markets in his 1938 book The Wave Principle."

Critics also warn the wave principle is too vague to be useful, since it cannot consistently identify when a wave begins or ends, and that Elliott wave forecasts are prone to subjective revision. Some who advocate technical analysis of markets have questioned the value of Elliott wave analysis. Technical analyst David Aronson wrote:

    The Elliott Wave Principle, as popularly practiced, is not a legitimate theory, but a story, and a compelling one that is eloquently told by Robert Prechter. The account is especially persuasive because EWP has the seemingly remarkable ability to fit any segment of market history down to its most minute fluctuations. I contend this is made possible by the method's loosely defined rules and the ability to postulate a large number of nested waves of varying magnitude. This gives the Elliott analyst the same freedom and flexibility that allowed pre-Copernican astronomers to explain all observed planet movements even though their underlying theory of an Earth-centered universe was wrong.

source: www.wikipedia.org


Best regards,
^^_Lord_Ice_^^

How to add an indicator over the oscillator on the MetaTrader 4 ?


If you will need to add an indicator over an oscillator you have to follow those simple steps:

1. Click on the navigator button .

2. Select from the Indicator menu the one you want to add. Let's say you want to add MA on RSI.



3. Select MA by click - drag & drop on RSI.

4. In the section " Apply to" select "First Indicator's data" and press Ok.


5. Now you will have a MA over the RSI Oscillator and looks like this:



Best Regards,
^^_Lord_Ice_^^

How to install an EA (Expert Advisor) on the MetaTrader 4 ?


To install an EA we need same files as for installing an indicator.




Copy those files to :C:\Program Files\Meta Trader 4\experts

 * Meta Trader 4 folder, usually has the name of the broker. 

Restart the platform, and open navigator menu by clicking on the .

Click on the Expert Advisor tab    then click on the EA installed + drag & drop to chart.


In the top right corner will look like this:




 


To activate it, you must have a "smilly face" instead of a "sad face". To do that: right click on the chart - Expert Advisors - Properties.






Best Regards,
^^_Lord_Ice_^^

How to install an indicator on the MetaTrader 4 ?


An indicator can be found in 2 formats (extensions): "name.MQ4" and "name.EX4". The MQ4 is the source code, and the EX4 is the compiled version of the code.



You don't need to use both extensions of the indicator. If you have only the EX4 extension of the indicator, it's fine, but you just wont see the MQ4 in the installed folder. If you have only the MQ4 extension, it will make automatically the EX4 extension in the folder of the platform. If you have both files, you can copy them directly in the next location:

C:\Program Files\Meta Trader 4\experts\indicators

 * Meta Trader 4 folder, usually has the name of the broker.

Restart now MT4 - click on the Indicators button - Custom - click on the indicator installed to attach it to the chart.





Best Regards,
^^_Lord_Ice_^^


Best color setup for my trading platform !


Trading for many hours every day, can be sometimes painful for your eyes. Specially if you are using multi-monitors like I do. That's why, after many years of testing different color setups, I have some conclusions to make.

If your trading on daily light, a few hours/day, in a lighter room you can use default colours. But if you use your trading platform more then 8 hours/day, mostly in the middle of the night, like I do, you need a special setup.

For colors setup options, right click on the chart - properties - colors.  


My default colors setup is like this:



From the common section, I've removed the grid. The chart is becoming too complicated when you add more tools for your technical analysis.

For the oscillators section, I use Dodger Blue colour.




Levels for all the oscillators, have the same colour as my grid:



In case I use the 3rd oscillator I use Light Sea Green colour:


In the end this is how it's looks like:


With this colors setup, I establish a personal record 48 h of trading, with no pain for my eyes. Of course with 10 min break, each 2 hours. 

Hope you'll find this useful for your day by day trading activity.


Best Regards,

^^_Lord_Ice_^^

Average Daily Range ( ADR )


If you are day trading, then it's always a good idea to be fully aware of the average daily range of the pairs you are trading. This is because you always want to know how much further a pair could realistically move given it's daily average in order to determine where you should set your stop loss and target price.

For instance if a pair has an average daily range of  200 points and during a given day it has been trading in a range of 200 points or more (and is trading at the top of this range with just an hour or so left), then you obviously would not want to be opening a long position because the odds are very much against you.

However if, for example, the range is currently 50 points and there is several hours left of the trading session, then a long position at the top of the range might be worth considering given the right circumstances because there is still room for a decent price move to take place.


Best Regards,

^^_Lord_Ice_^^




Pivot Points

A pivot point is a price level of significance in technical analysis of a financial market that is used by traders as a predictive indicator of market movement. A pivot point is calculated as an average of significant prices (high, low, close) from the performance of a market in the prior trading period. If the market in the following period trades above the pivot point it is usually evaluated as a bullish sentiment, whereas trading below the pivot point is seen as bearish.

Monthly pivot point chart of the Dow Jones Industrials Average for the first 8 months of 2009, showing sets of first and second levels of resistance (green) and support (red). The pivot point levels are highlighted in yellow. Trading below the pivot point, particularly at the beginning of a trading period sets a bearish market sentiment and often results in further price decline, while trading above it, bullish price action may continue for some time.

It is customary to calculate additional levels of support and resistance, below and above the pivot point, respectively, by subtracting or adding price differentials calculated from previous trading ranges of the market.

A pivot point and the associated support and resistance levels are often turning points for the direction of price movement in a market. In an up-trending market, the pivot point and the resistance levels may represent a ceiling level in price above which the uptrend is no longer sustainable and a reversal may occur. In a declining market, a pivot point and the support levels may represent a low price level of stability or a resistance to further decline.


* Monthly pivot point chart of the Dow Jones Industrials Average for the first 8 months of 2009, showing sets of first and second levels of resistance (green) and support (red). The pivot point levels are highlighted in yellow. Trading below the pivot point, particularly at the beginning of a trading period sets a bearish market sentiment and often results in further price decline, while trading above it, bullish price action may continue for some time.

Calculation

Several methods exist for calculating the pivot point (P) of a market. Most commonly, it is the arithmetic average of the high (H), low (L), and closing (C) prices of the market in the prior trading period:

    P = (H + L + C) / 3.

Sometimes, the average also includes the previous period's or the current period's opening price (O):

    P = (O + H + L + C) / 4.

In other cases, traders like to emphasize the closing price, P = (H + L + C + C) / 4, or the current periods opening price, P = (H + L + O + O) / 4.

Support and resistance levels

Price support and resistance levels are key trading tools in any market. Their roles may be interchangeable, depending on whether the price level is approached in an up-trending or a down-trending market. These price levels may be derived from many market assumptions and conventions. In pivot point analysis, several levels, usually three, are commonly recognized below and above the pivot point. These are calculated from the range of price movement in the previous trading period, added to the pivot point for resistances and KJKJKJsubtracted from it for support levels.

The first and most significant level of support (S1) and resistance (R1) is obtained by recognition of the upper and the lower halves of the prior trading range, defined by the trading above the pivot point (H − P), and below it (P − L). The first resistance on the up-side of the market is given by the lower width of prior trading added to the pivot point price and the first support on the down-side is the width of the upper part of the prior trading range below the pivot point.

    R1 = P + (P − L) = 2×P − L
    S1 = P − (H − P) = 2×P − H

Thus, these levels may simply be calculated by subtracting the previous low (L) and high (H) price, respectively, from twice the pivot point value:[1]

The second set of resistance (R2) and support (S2) levels are above and below, respectively, the first set. They are simply determined from the full width of the prior trading range (H − L), added to and subtracted from the pivot point, respectively:

    R2 = P + (H − L)
    S2 = P − (H − L)

Commonly a third set is also calculated, again representing another higher resistance level (R3) and a yet lower support level (S3). The method of the second set is continued by doubling the range added and subtracted from the pivot point:

    R3 = H + 2×(P − L)
    S3 = L − 2×(H − P)

This concept is sometimes, albeit rarely, extended to a fourth set in which the tripled value of the trading range is used in the calculation.

Qualitatively, the second and higher support and resistance levels are always located symmetrically around the pivot point, whereas this is not the case for the first levels, unless the pivot point happens to divide the prior trading range exactly in half.

Trading tool

The pivot point itself represents a level of highest resistance or support, depending on the overall market condition. If the market is directionless (undecided), prices will often fluctuate greatly around this level until a price breakout develops. Trading above or below the pivot point indicates the overall market sentiment. It is a leading indicator providing advanced signaling of potentially new market highs or lows within a given time frame.

The support and resistance levels calculated from the pivot point and the previous market width may be used as exit points of trades, but are rarely used as entry signals. For example, if the market is up-trending and breaks through the pivot point, the first resistance level is often a good target to close a position, as the probability of resistance and reversal increases greatly.




*5-day pivot point chart of the SPDR Gold Trust (GLD) for intra-day trading in October 2009


Many traders recognize the half-way levels between any of these levels as additional, but weaker resistance or support areas. The half-way (middle) point between the pivot point and R1 is designated M+, between R1 and R2 is M++, and below the pivot point the middle points are labeled as M− and M−−. In the 5-day intra-day chart of the SPDR Gold Trust (above) the middle points can clearly be identified as support in days 1, 3, and 4, and as resistance in days 2 and 3.

source: http://en.wikipedia.org/wiki/Pivot_points

Best Regards,
^^_Lord_Ice_^^