THE TREND IS YOUR FRIEND
Nothing ever said about currency trading is more true, powerful, and profitable than this concept!
But what IS the trend and how do we define it?
The trend, quite simply, is if a currency is going UP or DOWN. I, however, am more interested in what it is LIKELY TO DO IN THE IMMEDIATE FUTURE !!
So I define trend in this fashion. Anybody can look at a chart and SEE it going up, which would be an uptrend, or SEE it going down, known as a downtrend.
But as traders we MUST anticipate if the currency will CONTINUE to rise or if it is more likely to reverse and plummet. When looking at a downwardly moving currency, is it likely to CONTINUE going down or is it more likely to reverse and go up?
So how do you ANTICIPATE future trend directions? As a full time trader with over 10 years of experience, my business partner and I created two unique trend tools that are exclusive to our software. While we do sell this software for $2,000, we ALSO GIVE IT AWAY FREE! If you like what I have to say about what it is and how to profit from it, click on the links at the bottom of the page.
We measure the trends in two distinct ways.
Market Breadth – Our FX Power Index tool analyzes all currency and shows you the percentage of them that are going up and down. Additionally, it gives you a PERCENTAGE of the strength/weakness. For example, we can look at the EUR/USD (Euro Dollar), which is the most popular currency. We look at the Euro against the British pound and have to evaluate if it is it going up or down against the pound. If its going up, the Euro is strong, if it falls, it is weak. We do this same comparison using our advanced statistical tools against all other pairs. So for example lets assume the Euro is going up against every currency (the Pound, the Canadian Dollar, the US dollar, the Japanese Yen, Australian Dollar, New Zealand Dollar, Swiss Franc, etc).
For the Euro to go up it has to be strong and the US Dollar has to be weaker. So, when we do the SAME comparison against the US dollar, but the GBP/USD is going up, that means the USD is weak. When GBP/USD is going down, however, it means the USD is strong. In conclusion, we’re looking for the US Dollar to be weak against the same aforementioned currencies.
Instead of having to watch many charts to try to figure this out, our software does millions of calculations, analyzes the charts, and then simply gives you a percentage, green showing strength and red showing weakness. You get this both on your charts and on your hotlist, which sorts the pairs and then automatically links them to charts. Also, we have made it even easier to find the best currencies to trade. We plot the statistical strength/weakness ON THE CANDLES! There are 11 different shades of green, with darker shades indicating strength. The same system is used for weakness, with darker reds showing increasing weakness.
Now this is only HALF of what we do to help you succeed trading!
We have another tool called the FX Multimap, which shows you the INTENSITY of the trends. This is a proprietary tool that shows you the statistical intensity of the strength/weakness of the currencies. We also compare all the currencies to each other and measure statistically how strong/weak each one is.
Readings that indicate the size of a trend are represented on a scale from 0 to 50. 0 to 10 indicates a small trend, while 20-30 is moderate a moderate trend that usually continues, and 30-50 is an INTENSE trend that is VERY likely to continue.
OK, so I know what your tools do, but how do I use them to make money?
This is the easiest part, as we’ve done 95% of the work for you. Finding the currencies MOST likely to continue going up or down in the FUTURE allows you to easily find and place trades.
First, let me be completely honest with you. You will inevitably have losing trades. It’s a fact of trading! To think there is a holy grail out there that never loses is moronic. That being said, the KEY TO MAKING MONEY TRADING is having small losses, lots of break evens, and a few big winners.
Our methods tend to work 60% of the time. Though we don’t always win, our wins are as high as 30 to 150 pips, while our losses are usually held between 5 to 12 pips.
So even if you are wrong 6 times out of 10, you will still have a profit. Say on your bad trades you lose 5, 7, 10, 12, 10, and 12 pips. That’s 6 losses totaling 56 pips. On the 4 winning trades, however, you have wins of 12, 15, 30 and 50 pips. That is a net gain of 51 pips!
So even though you were successful only 40% of the time, you made a 51 pip Profit!
Here’s how you find the EXACT places to buy or sell using our trend tools. When our software finds strong currencies going up, you WAIT for a tiny 10 to 20 pip counter trend move down. Draw a trend line over the highs of the downward move, and as SOON as the price goes back above the trendline you BUY! You place your stop 5 to 12 pips away from entry RIGHT UNDER the last swing low. Our exit methods are just as simple, and we teach them in our complimentary forex classes that all our new traders get for a week after opening a brokerage account. It’s hard to explain these concepts without pictures of our charts, but we use Support/Resistance tools for exits, Fibonacci Profit Targets, Chandelier trailing stops, and also trendlines. Many of these trends explode in your favor, and you will often execute 30-100 pip moves.
For trading weak currencies, simply do the exact opposite. Wait for a 10 to 20 pip counter trend upwards, and draw a trendline under the lows of the up move. Quickly get in as soon as price breaks this trendline.