THE RETAIL V INSTITUTIONAL PATH
Unfortunately the constant within retail trader experience is the erosion of trading confidence through use of lagging historical studies within a price action based approach. Sadly neither of these carry any bearing on how FX markets move in the first place.
For so many, these are stumbling blocks which become the final blow to the traders willingness to drive forward. I can tell you that if that were the case for myself, I’d not be writing you. But what if you continued and maintained focus and determination? The stumbling blocks became my stepping stones that led me to discovery after discovery. It didn’t just surface today but there is a clear difference between retail traders and institutional participants – and it’s shocking! Institutional capital cares so little about price action it’s almost irrelevant.
WHY FX Rates Move with Fundamental influences.
HOW FX rates move with Cross Border Capital Flows
WHEN Prices move. Discovery of Opportunity
None of the components in the institutional approach have anything to do with charts and candles. In fact, intelligent strategy doesn’t use candles to build strategy it uses the data that causes prices to move in the first place. Always a step ahead of retail traders. Learn how we measure the fundamental influences, cross border capital flows and how we discover opportunity with market leading analysis. You can do so free! Just register for our August Course.
Complete Trader Education
The best FX trading approach uses superior market intelligence and teaches traders how to trade well while eliminating bad trader habits. But to trade fx well requires an in depth understanding of economics as well as market micro-structure. The foreign exchange markets is by far the largest market in the world as it dwarfs all others in comparison even when the ‘others’ are aggregated together.
It’s monstrous size is from the many industry sectors that have a component of foreign exchange. Banking institutions around the world are heavily involved in FX as are importers and exporters of produced goods. FX speculators are the smallest slice of daily turnover but oddly enough, this is the participant grouping that demands the most transparency and knowledge as they are more directly affected by exchange rate movements.
With iForex.Market you can expect something different. Our trading course stands second to none and lead the fx educational sector with price leading sentiment and real time trading models that analyze FX rates on the fly without the traditional historical lag traders are harmed by. Register a community profile, enjoy our trading sessions and join our Traders Course. You’ll learn how the market moves and so much more as your confidence soars!
Learning to Trade off Market Repetition with Ease A Powerful Lesson in Forex Market Liquidity can be experienced by sitting on the beach and looking out at the ocean. If you’re not close enough to a beach, no worries, your imagination will do. Is there something you can see that relates trading in some way? The water and the waves crashing upon the shore. This is what market liquidity does every day, every hour and every minute so let’s learn from it. As we sit upon the shore, the similarities between the ocean waves on the shore and market liquidity contributes to one of the most powerful methods and approaches of market analysis.
Think of the ocean’s tide as a trending market advancing upon the shore. What’s happening to the waves of movement is quite similar to the ebb and flow of FX liquidity, market sentiment and ultimately traded volumes. The tide and waves show you the higher lows and highs just before they peak at the top of the trend and crest. This is exactly what happens with market liquidity and exchange rate movements. While the top of the trend shows us a highs, the downward trend starts with the ebb and flow receding in the same manner as the climb.
I’ve taught traders with this metaphor for 18 years. It’s provided many traders with a dynamic understanding of market movements in FX. Learning to trade foreign exchange isn’t difficult, or at least it doesn’t have to be. Instead though of studying technical studies, focus on the forces that cause the market to move in the first place and you’ll experience tremendous gains in both confidence and performance!
Wiping the Slate Clean for Fresh Market Insight When traders approach me to teach them how to trade forex, before they access the Forex Traders Course I start by helping them wipe the slate clean. This triggers an opening in the mind so they may study the core influences of exchange rates. It’s the cross border money flow that traders never see and it’s by far the most powerful analytical approach there is as it allows us to use natural market sentiment to lead prices at every turn. This is the very reason why prices move, how far they move and exactly when exchange rates present us opportunities we can capitalize on.
The Core Influences of Exchange Rate Movement So if cross border money flow causes exchange rates to move, how do we identify this ‘money flow’? I’ve integrated non lagging currency indexes into my approach and trader instruction. The indexes allow us to compare apples to apples with normalized values. This is one part. We can see when exchange rate movement change their trend when indexes cross one another. This is important as trends cannot change unless the indexes in fact cross with their underlying values.
One FX Rate Two Instruments While we may be trading the relationship between the two currencies on our charts, there are in fact two instruments we’re analyzing. This strongly suggests that any analysis that does not analyze currency values in their individuality is a flawed approach, which then makes perfect sense as 90% of traders fail when trading FX due to unknown factors. Sentiment and Volume are the unknown factors.
Strong Opportunities to Speculate on FX Rate Movement While the currency indexes are important – what’s more important is the differential between the indexes. This provides us a glimpse of money flow into one currency and a opposing difference in the volumes of money flow into or out of the counter currency. We see statistically strong movements when the two indexes have a differential of 10%. It’s AMAZING!