I was trained as investment analyst and I used to be a fund ( not fun) manager and have been utilizing chart/graph for my technical analysis. Since my demise as fund manager after the Asian monetary crisis back in 1997, I have not been into the stock market since. But in my spare times I still delve in technical analysis. All the tools of technical analysis from the simple moving average to the sophisticated system such Elliot wave and Gann Analysis I have covered and studied.
Note:
The main difference between fundamental versus technical analysis of the market is that, while fundamental analysis uses economic, political, social and other factors that affect supply and demand of the market to foresee price movements, technical analysis uses mathematical and graphical charts of previous market action, in order to analyze the market.
The main difference between fundamental versus technical analysis of the market is that, while fundamental analysis uses economic, political, social and other factors that affect supply and demand of the market to foresee price movements, technical analysis uses mathematical and graphical charts of previous market action, in order to analyze the market.
From applying the technical analysis for the stock market, I extend my knowledge of technical analysis into commodities and futures market such as palm oil, gold, T-Bond and etc.
During the past one year, I was fascinated with forex market that has bloom rapidly through internet trading. My first impression of involving in the forex market was; it is the same as applying what I learned for the stock market and commodities/futures market. And at least it is way to make money online/at home without the hustle of facing the rush hour of 9-5 job.
Oh boy!...I was wrong. The forex market is a different kind of animal. It is easier said than done. All the system that I have done for the stocks, commodities and futures market have to be tested and retested, and fix to fit the 24 hours and five days a week of forex market. I have to go through the school of hard knocks.
In trading of stocks/commodities/futures, I can base my analysis purely on technical analysis, but in forex market fundamental played a lot of factors especially especially prior to the release of economic data. For example, about 30 mins before the release of nonfarm payroll, the US Dollars will be very volatile with wide gap-up or down, and our stop loss position could be easily hit.
The force that drive the value of a currency is demand and supply. When we trade a currency we trade a currency pair, for example EURUSD. In this way we have a double effect because two currencies are involved. If the Euro-zone economy is strong, the demand for EUR would also be strong and the EURUSD should be appreciate. IF we at the same time have a weak US economy than the pressure on the USD is heavy and this should appreciate the EURUSD(i.e. depreciating USD).
What about if the economy in US also strong? Which way will be EURUSD moving?
The first lesson that we have to bear in mind is to cut loss. Period.
The key here is how to manage losses. To manage losses is to cut them quickly before a small loss becomes a large one.
Never ever think that you will never lose. That's just ludicrous. Losses are just like profits, it's all part and partial of forex market game.
Losses are unavoidable. Get over the loss and move on to the next trade.
The key here is how to manage losses. To manage losses is to cut them quickly before a small loss becomes a large one.
Never ever think that you will never lose. That's just ludicrous. Losses are just like profits, it's all part and partial of forex market game.
Losses are unavoidable. Get over the loss and move on to the next trade.
