January 2014
Foreign Exchange News, Analysis, Education for Currency Traders
2014
The Craft of Mastering Forex Trading
TRADERS: NEW BEGINNINGS
TRADER’S CORNER
WORLD CURRENCY NEWS
THE BEAUTY OF THE REAL TRADING SESSION
TRADERS NEW BEGINNINGS IN FOREX STRATEGIES FX TIPS & TRICKS
FOREX SIENCE
TECHNICAL ANALYSIS REVEALS BIG PROFIT FROM THE CABLE
AUTOMATING FX TRADING STRATEGIES
THE ART OF FOREX
Efficient execution is key to trading performance. Automating strategies can be an obvious solution but 29 also involves risks.
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LOOK FROM A DEEP LENS
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CONTENTS TECHNICAL ANALYSIS REVEALS BIG PROFIT FROM THE CABLE US GDP for the US came out better than expected at 3.6% growth (although revised to a 4.1%), unemployment rate drop to 7%, and the overall picture improved at a moderate pace.
THE BEAUTY OF THE REAL TRADING SESSION Our method of trading allow us to confidently trade openly five days a week and some night sessions as well.
Basics for Trading in a New World Market
TECHNICAL ANALYSIS
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Big Profit from the Cable GDP for the US came out better than expected KNOW FOREX
FOREX SIENCE
Interview with Fabian Bordel / Currency Broker Representative From IronFX Solid Trading
Trading
President of Art of Forex United States Trends and Different Markets / The New Beginnings with Old Markets
13 FX MANAGERS
7 Straight Facts on Forex
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Our aproach to trading in the Forex Market /
INTERNATIONAL NEWS GDP Better expectations Markets View
TECHNICAL ANALYSIS REVEALS BIG PROFIT FROM THE CABLE Our market analysis on the third week of November 2013 shows the pound dollar coming closer to a sell position entry. We have been following the trend of the cable for several months. Some news events got in the way of us taking a significant short position at the moment we wanted to. Since March 2009, coming in from a recession
for England. On the US side, the economy has been growing, despite Congressional lawmakers wrangling over the debt ceiling and constant talk against the dollar.
and into a recovery, the cable got into a range market. Our Market Analysis indicated to us to go SHORT between 1.6380 to 1.6440.
unemployment rate drop to 7%, and the overall picture improved at a moderate pace. After getting this numbers, the Bank of England came into session, mentioning that they needed to keep a watch on the exchange rate, because as we know a strong currency is not good for growth.
Although at the moment we needed to get news from the US and UK to confirm the entry point. The pound got really good news and it looked very stable in comparison to the other basket of currencies against the dollar. The economic news included unemployment lower, manufacturing rose, retail sales rose and the overall picture look very promising artofforex.org
2014
GDP for the US came out better than expected at 3.6% growth (although revised to a 4.1%),
The Bank of England began the process of trying to depreciate the currency in order to make the growth of the economy even better and stronger.
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All of these indicators confirmed to us the cable was preparing to be a good sell position.
Technical Analysis According to our analysis, a good sale of the pound dollar is between 1.6380 to 1.6440. Our indicators shows to us that the target point is 1.5860. Stochastic’s showing an overbought on the weekly, and a MACD at the tip of the curve. RSI is also showing sign of moving to the down side. There are whole set of market analysis that we use, and will be discussed in more detailed future issues. Although the overview for the United Kingdom looks good; a US economy looks even stronger. The Bank of England has a meeting in mid
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January and from that point they will discuss their economic policy and review the status of the pound currency in the market. The other event we need to keep an eye for is the US debt ceiling discussion the start of January. This particular news will indicate much of how 2014 will be for the US economy. We also need to take into consideration, that from January’s Fed meetings can mean a cut back on the QE, which is already making the dollar stronger again against the basket of currencies.
In conclusion, our suggestion based on the Art of Forex analysis from our 4DTS approach is to go short on the cable until it reaches an area of around 1.58ish.
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LIVE TRADING SESSION
THE BEAUTY OF THE REAL LIVE TRADING SESSION
The beauty of a the real Live Forex Trading Sessions comes from the satisfaction of allowing others to watch us analysis the Forex market and seeing our suggestive entry points and exit points. Our methods of trading allows us to confidently trade openly five days a week and some night sessions as well. Overall for us, the enjoyment comes from trading at a high rate of accuracy. No one continues to trade openly without a proven track record of successful trading month artofforex.org
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after month. Have we decoded the Forex currency market? No but we might have it figure it out to a point
Our philosophy has always been “we will become successful as well as helping others become successful.”
that makes us successful. Our trades are usually done from several seconds (major news events) to within an hour time or in some cases
over an hour. Rarely do we allow our trades to be rolled overnight. We strive to achieve a personal goal each day and for the whole month. Our philosophy has always been “we will become successful as well as helping others become successful.” Below you will see our trading screen. In our session, you will hear us analysis the market, and we have a chat window for us to post our entry and exit points, and to give our attendees a chance to ask us questions. 6
Daily Trading Monday to Friday 7:45 am to 10am (Nights sessions as well)
TYPICAL CLIENTS IN OUR LIVE TRADING SESSIONS We have found out that we have about three types of clients who join up on our Live Trading Sessions. They are the following:
Newbie
These people are so glad to find us, as they want to see if currency trading is for them. They want to experience seeing currency trading in real time and
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2014
having a professional analysis of the market and confidently give out suggestions on what pairs to trade at that moment and when to get out of the trade. First thing they do is open up a The newbie’s demo account and follow our trades are looking for exactly (we recommend this, but you proper guidance can also jump in from day one). Their expectation, is that they will become and excitement of profitable in their money management knowing if currency screen. The newbie’s are looking for trading is done right proper guidance and excitement of it can be the Greatest knowing if currency trading is done right Show on Earth it can be the Greatest Show on Earth.
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Confused Day Traders
These people have
dabbled as day traders in stock, futures, currency, etc. but were limited in their success for varieties of reasons. No real guidance, bad instructor, trying to self-learn, the list goes on and on. What we like about these guys is they catch on a bit quicker and become immersed in trading for profit instead of trading with their finger crossed. In this case here, they will open up a demo account first then later move to a real account as they begin to see the potential of trading with us.
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Money Management Screen
News Event Chasers The biggest profit gain in the shortest period of time is when big economic news is announced. The Live Trading Room becomes packed with excitement and anticipation of a large sudden movement in the market. Yes, we have days where the certain news events has allowed us to picked up over 100 pips in very short period of time.
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The Craft of Mastering Forex Trading
Our approach to Trading in the Forex Market We have a proven approach on seeing the market that gives us the edge. Our market analysis is based on 4 principles or pillars we call it the 4 Dimensions of Trading, when implemented correctly, improves the chances of success dramatically. They are technical analysis, fundamental analysis, sentimental analysis, and traders’ analysis. Remember like everything in this world, you need to adapt, learn, mold and create to order to succeed. That’s why Forex is an art.
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We go over the different aspect of the market, we implement our approach using the 4DTS, which was developed in-house, that gives us an advantage on our market analysis. With this information we can make clear suggestion of entry points and exit points. This is how we strive to achieve our daily goals. We know that the Forex Market is a wide extensive environment, sometimes as traders feel alone and in need of different assessment. We believe as a community we can get that approach and have a successful trading experience.
Getting Started – Get 5 Days Free Trading Sessions Access We allow anyone who is interested in joining our Live Trading Session for free for 5 trading sessions, and different ways of getting information:
1 Message alerts 2 Email Alerts 3 Real live trading session with comments and chat.
All of this will enhance your chances and way of trading the forex market. To sign up for the free trial period visit our web site at www.ArtofForex.org and request a free invitation. For those, who are ready to get on a month to month subscription, then you visit www.artofforex.org artofforex.org
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How to Profit from Knowing Currency Correlation
Some currencies tend to move in the same direction, some — in opposite. This is a powerful knowledge for those who trade more than one currency pair. It helps to hedge, diversify or double profitable positions. Statistically measured by performance, currency pairs are given so called “correlation
coefficients” from +1 to -1. Strong Positive Correlation The example of strong positive correlation between two currency pairs is: GBP/USD and EUR/USD. They have a correlation coefficient of over +0.90, which means that when
EUR/USD goes up, GBP/USD also goes up. A well known sample of two opposite moving currency pairs is EUR/USD and USD/CHF, they have very high coefficient of over -0.90, which means that they move inversely almost 100% of the time!
Some Currency Pairs who move in the same direction:
Some Currency Pairs that are Inversely moving pairs:
EUR/USD and GBP/USD
EUR/USD and USD/CHF
EUR/USD and NZD/USD
GBP/USD and USD/JPY
USD/CHF and USD/JPY
GBP/USD and USD/CHF
AUD/USD and GBP/USD
AUD/USD and USD/CAD
AUD/USD and EUR/USD
AUD/USD and USD/JPY
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How a Forex Trader can take advantage of this information?
For example, a trader has opened
means that pairs are moving
long positions on both currency
mostly in the same direction but
pairs. Since they move in opposite
not as perfect (which is what we
directions, if EUR/USD is making
need here). If we decide that USD
some losses, the other pair will
is going to weaken, for example,
go in profit. Hence, the total loss
we will go long and place half of
will not be as bad as if it would
buy order on AUD/USD currency
be without the second “backup
pair, and half on EUR/USD.
A very simple use is avoiding
trade”. On the other hand, profits
Splitting the orders will preserve
trades that cancel each other. For
here are not large either.
trader’s positions from sudden losing rallies (sudden “jumps” in
instance, knowing that EUR/USD and USD/CHF move inversely
When confident, a trader may
price); and as these currencies
near-perfectly, there would be no
double position size by placing
move not 100% identical a trader
point to go short on both positions
same orders on parallel (moving
will have some time to react
as they eventually cancel each
in the same direction) currency
adequately. Different monetary
other (loss + profit).
pairs.
policies of different countries’ banks also create an impact:
Be Smart, Be Ready
Another option would be to
when one currency will be less
However, there is a strategy of
diversify
affected than the other and
hedging one currency pair with
instance, AUD/USD and EUR/
another. Lets’ take the same
USD pairs have the correlation
pairs: EUR/USD and USD/CHF.
coefficient of about +0.70 which
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risks
in
trade.
For
therefore will move slower.
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Straight Facts on Forex Trading
Online forex trading has become very popular in the past decade because it offers traders several advantages.
1 2 4 3 $5 Trillion a Day Trade Volume
The foreign exchange market, which is usually known as “forex” or “FX,” is the largest financial market in the world. Compared to the measly $22.4 billion a day volume of the New York Stock Exchange, the foreign exchange market looks absolutely huge with its $5 TRILLION a day trade volume.
Major Currency Pairs
While Forex brokers will let you trade many different currency pairs, a select few are considered to be the majors. The major currency pairs in the Forex market are EUR/USD, USD/JPY, GBP/USD, AUD/USD, USD/CHF and USD/ CAD and sometimes the NZD/USD is also thrown into the mix. About 85% of all of the trading in the Forex market is comprised of these pairs. This is an overwhelming majority where of the money is made. artofforex.org
2014
Forex Market Never Sleeps
Trading goes on all around the world during different countries’ business hours. You can, therefore, trade major currencies any time, 24 hours per day. Since there are no set exchange hours, it means that there is also something happening at almost any time of the day or night.
Who is Trading?
Although the foreign exchange market is definitely a global market, a few players are more active than others. Over one-third of the trades in the market (34.1%) are generated from the United Kingdom. By comparison, the next biggest player in the market is the United States with a little over 16% of the trades every day. This leaves the other half of the market to the rest of the world.
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5 6 Forex trading time
New York opens at 8:00 am to 5:00 pm EST (EDT) Tokyo opens at 7:00 pm to 4:00 am EST (EDT) Sydney opens at 5:00 pm to 2:00 am EST (EDT) London opens at 3:00 am to 12:00 noon EST (EDT) Overlapping market hours And so, there are hours when two sessions overlap: New York and London: Between 8:00 am — 12:00 noon EST (EDT) Sydney and Tokyo: Between 7:00 pm — 2:00 am EST (EDT) London and Tokyo: Between 3:00 am — 4:00am EST (EDT)
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But how do you know which currencies will rise and which will fall? Over the years, forex traders have developed several methods for figuring out how far currencies will go.
Fundamental Analysis: Once currencies trade in a market, you can look at supply and demand. This is called Straightdamental analysis. Interest rates, economic growth, employment, inflation, and political risk are all factors that can affect supply and demand for currencies. Technical Analysis: Price charts tell many stories and most forex traders depend on them in making their trading decisions. Charts can point out trends and important price points where traders can enter or exit the market, if you know how to read them. Money Management: An essential part of trading. All traders need to know how to measure their potential risks and rewards and use this to judge entries, exits, and trade size.
What Currency Pairs are hot and when are they hot?
During the 24 hours period currency pairs in Forex market experiences several hours when the volume of trades is the highest and so is the pip movement.
London / New York Sessions EUR / USD USD / CHF GBP / USD
Tokyo/Sydney Sessions EUR / JPY AUD / USD USD / JPY AUD / JPY
Sydney Session AUD / USD EUR / USD
Forex market sessions and examples of the most active currency pairs.
During the week the most active Forex trading days are: Tuesday, Wednesday and Thursday. Sundays (opening) and Mondays are days when traders are mostly watching and analyzing the market and predict further price moves. Fridays are traded approximately till noon, after that all actions slow down and almost freeze before the actual market closing at 5 pm EST. artofforex.org
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Currency Broker Representative / Fabian Bordel From IronFX Solid Trading
1.
What do you feel is the important things that separated you from other currency brokers? IronFX Global prioritizes itself with providing best-of-market spreads, execution, liquidity and bespoke trading functionality to its retail and institutional clients. Even the often unnoticed aspects of a trader’s necessities make a significant difference in one’s trading experience. We have therefore put together the best possible tools and have made them fully accessible to the client trading experience. 2. What are some of your most popular services that you provide your clients? - Global Operations in more than 40 cities to better serve local clients - Safety of Clients’ Funds is safeguarded with security, clarity and integrity - Easy-to-Use single interface funding to clients’ trading accounts - 1 Account access to 15 Trading Platforms with 200 Trading Instruments - Best Trading Environment with lowest spread in the market and flexible leverage up to 1:500 artofforex.org
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- Best Trading Execution, instant execution with no slippage and market execution with no requites - Utmost Liquidity provided by 18 international banks enabling access to one of the deepest liquidity pools from world’s leading providers - Research and Analysis by leading strategists timely - 24/7 Customer Support with 46 languages available 3. What special promotion do you have for new clients? - Welcome Bonus up to 100% on clients’ deposits - Deposit & Trade Program with free iPhone or iPad Air as prize - Live Trading Competition with Top Prize of US$150,000 funded account or US$ 100,000 cash+2 VIP tickets to watch F1 Monaca Grand Prix - Demo Trading Competition with Top Prize of US$10,000 or a luxury holiday in the alps 4. Can you talk about how secure is the clients’ money with your company? - Accounts with Top Tier Banks: IronFX Global provides banking and treasury services through UBS, Bank of America Merrill Lynch,
BNP Paribas, Raiffeisen, UnitCredit Bank and other world-class banking institutions to its clients. - Segregation of Client Funds: IronFX Global maintains segregated client accounts to ensure that client funds are fully separated from IronFX’s own funds at all times. Client accounts have the required coding to ensure that they are used for clients funding purposes. All client funds deposited at IronFX Global are completely segregated following our strict policies and procedures. - Protection by the Investor Compensation Funds: IronFX Global is treating all clients as retail clients in an attempt to offer the highest protection. As a member of the Investor Compensation Fund, our clients may be eligible to have a payment in case of the inability/ failure of the member to fulfill its financial obligations. - Risk Management: IronFX Global through its award-winning trading platforms provides an automated risk management system that ensures that our clients’ account balances will never go negative.
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5. Can you tell me how competitive
are your spreads? IronFX provides the lowest applicable spreads in the market starts FROM ZERO pips. (Source: http://www.ironfx.com/ en/trading-accounts/spreadscomparison ) 6. How easy is it for clients to sign up as a new client? A new client just needs to complete our simple 3 step registration process, submit a proof of
One of the client’s top criteria on selecting a trading firm is to find a regulated entity where EU regulations will be adhered at all times. Trading with a regulated investment firm, clients are comfortable that proper security, transparency and integrity on their daily transactions will occur. IronFX Group is authorized, regulated, registered and is a member of the below competent authorities/ regulators as well as
Financial Services Provider (FSP) under the registration number FSP298966. - IronFX Russia LLC is a member of Center for Regulating OTC Financial Instruments and Technologies (CRFIN) with membership No. A-8. - IronFX Global is authorized and regulated by The Cyprus Securities and Exchange Commission (CySEC) and is permitted to provide investment and ancillary services or/ and perform investment activities.
9. How do you see the market for
identification and proof of address and your trading account will be opened immediately. 7. What is the process if client want to withdrawal their funds? It is very simple. The client just needs to log in to our client portal and make your withdrawal request. Our account management officers will receive your request and proceed accordingly. 8. What are the regulatory requirements to be a currency broker? artofforex.org
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professional and governmental bodies: - IronFX Global UK Limited is authorized and regulated by the Financial Conduct Authority (formerly the FSA) under Registration No. 585561. - IronFX Global (Australia) Pty Ltd is authorized and regulated by the Australian Securities and Investment Commission (ASIC), under AFS license No. 417482. - IronFX Global NZ Limited is authorized and regulated as a
2014? And what should an investor look for? According to Marshall Gittler, our Head of Global FX Strategy, the biggest theme is likely to be the Fed’s tapering off of its $85bn in bond purchases. The Fed cut this down to $75bn and hinted that it would continue to reduce purchases by $10bn at each meeting, which implies and end to this most extraordinary market operation by October. Tapering may push interest rates up in the US and around the world, particularly in the emerging markets. That would cause slower global growth, which would have big knock-on effects. The question of how the global economy handles the withdrawal of the Fed’s stimulus may be the biggest issue of the year. Another major theme is likely to be the exceptionally low inflation. Another major theme is likely to be the exceptionally low inflation. You can see in this table both how low inflation is in the G10 — an average of 1.3%, well below most central banks’ targets of 2% — and also how rapidly it’s been falling recently. This isn’t just because of falling oil prices, either.
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Core inflation, which strips out the effect of energy and food, is falling too. Moreover, the downward pressure on prices is likely to continue in the future, because producer prices are falling as well. (For extended Market Outlook 2014 by Marsahll Gittler, Click on the link below to read about his expectations for 2014 in our blog post: https:// blog.ironfx.com/market-insights/ themes-for-2014-and-outlook-forthe-major-currencies/ )
10.
Can I open a demo account and how much would that be? Yes you can; with ZERO charges. 11. Do you offer an education classes for someone new to currency trading? strategies of others within the trading community, in real time. The Social stream contains the last 100 live trades placed by other traders
The Craft of Mastering Forex Trading artofforex.org
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as well as pending orders and updates placed by other members of the trading community. 12. Do you offer a live trading session so I can watch a professional trade in the real time? Yes. IronFX with the Sirix Social WebTrader offers the online trader access to the live trades of others. It enables the trader to follow and copy the successful trading strategies of others within the trading community, in real time. The Social stream contains the last 100 live trades placed by other traders as well as pending orders and updates placed by other members of the trading community.
13.
Can you talk about your trading platform and is it easy to use? The IronFX Group provides a unique ‘One Account, Fifteen Platforms’
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trading functionality and more than 200 types of products are available through its platforms. Its highly customized trading environment gives it an incomparable advantage in the market. 14. How many offices do you have worldwide? IronFX’s Global Operations run in more than 40 cities with 50 local offices. 15. What is the minimum amount to open an account with IronFX? US$50. 16. Do you offer managed accounts? No, we don’t offer Managed Accounts, we provide some other companies, with quality and experience on trading. The clients will have the chance to choose the best company for them, based on the risk profile that they have. artofforex.org
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TESTIMONIALS FROM OUR LIVE TRADING SESSION “Rare exceptions to find a live trading session, where you they are consistently on target”
We have great followers and these are some of the comments that we wanted to share.
“Anyone who wants to see Forex Trading must see them trade live”
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“The Art of Forex moderator Francis Reyes delivers day in and day out”
“They trade with real money and that makes the difference with me. Currency trader for 4 months and have come out ahead every month. “
@artofforex
“I suggest you watch these pros doing a big news days and follow them to the tea”
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ABOUT US
Art of Forex Key Members Francis Reyes President of Art of Forex Trading Academy in Charlotte NC. He’s the creator of the 4D Trading Strategy and has devoted followers on his Live Trading Sessions. Mr Reyes is recognized as a top currency trader for many years. He has served in the International Monetary Funds (IMF) in Washington DC. Hold a Master in International Marketing with concentration in Finance from Strayer University. He’s the main moderator in the Live Trading Session. Speak multiple languages. freyes@artofforex.com 954.300.1049
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Robert Osorio Managing partner of Art of Forex Trading Academy. Based in Tampa, Florida. Over 8 years in currency trading, co-moderator in the Live Trading Session. Holds a degree in Mass Communications and has held positions as a technical analysis, technical trainer and International sales engineer.Has run other several based businesses. robert@artofforex.com 727.504.7803
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