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Tuesday, 18 July 2017

How to Monitor Your Trading Progress




It is recommended to keep a record of your trading career to track your trading progress. This will also enable you to verify your track record when necessary if you decide to go public with your trading to attract customers/investors. There are a few ways you can track your trading journey which will be the highlight of this blog.

Manually

A good way for beginners to track their trading career is by doing it manually and keeping a trading journal. This will enable you to record information that surrounds your trades. Trading journals can either be done in soft copy using excel or a similar program or hard copy using ruled pages. Either way it is recommended that you keep a journal for all your trades.

   Pros
  • You can record psychological information such as reasons why you make the trade, reasons why you chose the stop loss or take profit you did.
  • You get the opportunity to record news events that affected your trade.

   Cons
  • Time consuming
  • Might miss some opportunities



Automatic Recording

There are also automatic ways to record your trades that frees up your time to trade some more or learn more. Automation is fast becoming the wave of trading today and automated tracking of trades is no different. Two system/tools are listed below that assist in automated recording of your trades.

   Myfxbook
Myfxbook is an excellent source to keep a track record of your trading journey. It can be connect to MT4 and MT5 as well as other proprietary trading platforms. It will record all your trades once you link your trading account to your Myfxbook account. It provides extensive analysis on your trades and and your overall trading career. Myfxbook is one of the premier sources for trade tracking and verification of your trading skills.


   fxblue
This another source for tracking and publishing trades to the internet community. It is similar in features to Myfxbook and also provides a number of tool to get you started. The service provided is free of charge to users and it allows you to either keep your statistics private or publish them for growth of your circle of followers. fxblue has been around since 2009 and is a trusted source by all types of traders ranging from regulated money managers and hedge funds through to private individuals scalping the markets from home.

Pros
  • Time efficient
  • Comprehensive display and analysis of your trades
  • Ability to share with a wide circle of people
  • Provides Daily, Weekly,Monthly and Yearly breakdown of your trades. As well as trade by trade analysis

Cons
  • Need to create an account with a broker as well as an account with the automatic tracking providers.



At the end of the day it is imperative, if you want to progress, that you track your trades and the statistics of your trading career.  Also the benefits of using an auto-tracking system is far more efficient than trying to do it manually. Do you track you trades?

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Tuesday, 4 July 2017

Social Trading

Earnably

What is Social Trading?


Social trading is essentially online networks where other traders display their profile, track record and trading strategy so you can copy all that they do and profit in similar manner as them. social trading allows you to trade in already established system without spending too much time re-inventing the wheel so to speak. With social trading the established traders gains, losses, and their entire trading history is displayed for you to view and make an informed decision on which trader you will decide to follow. Each traders strategy may be an automated system or mechanical system, either way everything they do as it concerns trading on the platform will be shown to you. One should be warned that social trading can be as risky as trading on your own if the person you are copying is not profitable or becomes unprofitable after you have subscribe to their channel.


Social Trading Platforms


There are a number of trading platforms that has been developed over the years and allow anyone, even persons without trading experience, to take part in the world of trading. Etoro is one of these major platforms that gives such exposure. With most of the trading platforms you can register and monitor the traders before taking part in trading.
ZuluTrade is one of, if not the largest social trading platforms in the world at the moment. There are persons making a fortune copying other traders successes. Take and look and evaluate.
There is Ayondo, Tradeo and a host of others out there that you can research more here. All these platforms offer multiple instruments to trade but you still have to remember your risk management.

Benefits of Social Trading


Social trading can provide you with a lot of benefits if you capitalize on this money making opportunity. Such benefits include reduced time spent around the computer trying to learn and implement a trading strategy as such you have more time to spent with your family or do other things do you love to do. You get the benefit of profiting from the effort of an entire network which ultimately increases your ROI. Social trading opens you up to Forex, Binary Options, CFDs, Commodities and a wide range of stocks. This ensures diversity in your trading portfolio and the ability to earn different kinds of income such as long term or short term and you get to participate in capital gain as it concerns growth of stocks. Social trading is speedily becoming the next preferred method to trade and it allows almost anyone to enter into the trading arena and earn an income. It would benefit you so take a look into today and follow us for more information.

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Wednesday, 21 June 2017

Enjoy Earnably



Earnably is a website where you can earn point and receive cash back completing simple tasks. These tasks range from playing games, following on social media and posting in forums. They also reward users by posting redeemable promo codes on their social media platforms.
There is also an offer wall where you accumulate points by completing offers from other services. There are a lot of offers presented on their offer wall that will surely be able to find one that is suitable for you. In addition to these offers there also daily survey to complete and videos to watch for you gain more points.
Once you have acquired a minimum about of point you can then convert the point to cash and withdraw via PayPal or convert the points to bitcoin and with draw to your bitcoin wallet. You can also convert your points to amazon gift cards and use them to purchase whatever you want to. They also provide ways for you to introduce people to their service and earn point while you introduce your friends and family to earn as well.

They provide a number of resources to help you promote and earn more points and thus more money. Learn point by even installing apps to your phone and using them. Play games and earn point, enter contest and win points and if you have any issues you can contact them and they will be able to assist readily. The more contest you enter and win the more points you get and thus more money. Overall the idea behind what is done at Earnably is a good one and i would recommend it to persons looking to get a few extra bucks in their spare time.

Wednesday, 7 June 2017

Britain Elections and its effect on the GBP

The British pound went through a huge dive when the UK decided to exit the European Union (EU). Since then it has been trying to rally and regain some ground. Another highly volatile event now exist for the British Pound, this being the UK general elections that will take place tomorrow. Before attempting to trade this event there are a few things to consider.

London Terror Attack

This event took place over the past weekend and was a horrific attack in the UK capital. Although the event didn't affect the GBP greatly against its USD counterpart it may play a significant roll when combined with the UK general elections that is slated to happen on Thursday June 9.
The attack left 7 people killed with 48 injured and distributing an air or fear over the city of London. This attack delivered a blow to businesses and a lot of precautions will be taken in order to prevent such an attack from reoccurring. It is reported that the attackers were killed  shortly after committing the heinous act.
This event may also cause voters to lose confidence in the present government's ability to keep them secure and could drive the voters to vote otherwise. Although political campaigns were cancelled Monday due to the attack, the Labour party has gained significantly on the Conservatives who are still leading however.

Current Prime Minister


The current prime minister of the UK is 60 yrs old Theresa Mary May a British politician who also serves as Leader of the Conservative Party since July 2016, the second female to hold both positions.
Within Theresa May's tenure it can be recorded the UK exited the European Union and as such removed themselves from whatever benefit that union provided. It also prevents residence of the other members of the EU from getting any direct benefits from the United Kingdom.

Since May announced the Election on April 18 her and her Party's lead has been declining. Although they are still in the lead it may be of great concern to the party headquarters that their lead has moved from 17.8 points to just under 10 points. This could lead to a change in power in the government which could affect investor confidence, business growth, economic strategies and the GBP.

Considering that a switch in governance may happen here are a few things to evaluate before you trade GBP pairs:
1. How volatile will the GBP behave.
2. Have i set my stop losses and take profit on all GBP pairs.
3. It may be better to stay away from GBP pairs till the election noise settles.
4. How will my ope trades be affected.

Even if the Conservatives remain in power the GBP may still be volatile on the day and the day following the election.

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Monday, 5 June 2017

Automation of trades

Automating some aspects of your life would be good as you wouldn't have to worry about the everyday tasks of getting certain things done. One important part of life that every should aim to put on autopilot is your income and there a few ways to use Forex to put income on full auto or semi-auto. A couple of these ways are talked about in this article and how they will benefit you.

EA


EA or Expert Advisor is a program coded to trade on its own once you start it. It is also referred to as a trading robot because it trades on basic rules that you set in it before you let it start trade. You can create an EA if you like but you would need to learn a coding language which make take months or years to get it right and trading profitably.
On the other hand there are other ways that you can get an EA without doing any coding. One way is to get one made based on your trading strategy. You can get this done by coders on fiverr.com or any other such site. Another way is to purchase one directly in MT4. Keep in mind that there are thousands of EAs in the MT4 platform so be sure to evaluate and test first before putting one on your live account.
EAs work well for someone with a busy schedule or when you just want to put your income on Auto-Pilot. The EA that you choose to use should incorporate properly money and risk management in it, these include but not limited to risk per trade, take profit and stop loss.

Signal Services

VPS Hosting


Within the trading arena, whether Forex, stocks or futures, there are a lot of instruments being traded. Within the Forex industry alone there are numerous currency pairs on the market that you can make a profit (or loss) from. However, if you follow all the signals that will pop daily it will consume all your time and energy. To solve this and maximize on your time, energy and profits signals service was created to assist other users in their trading endeavours.
Signal services are systems, either automated or manual, that provide you with trading setups, strategies and insights on different currency pairs. Before getting subscribed to a signal service you should evaluate their performance, trading ideals and also their longevity.
Automated signal services will provide an EA that gets signals directly from them and executes trades accordingly. The setup will include entry and exit points but in addition to that you can also close or open trades for yourself. The best way to utilize the automated signals is to setup a VPS server and then install your MT4 there so that the EA can run even while you sleep.
Manual trading signals means that when the providers send the signals you will have to open and close the trades yourself for all signals provided. Manual trading signals can be sent via email, text messages or through an indicator provided by the service provider. The upside of this is that you get a chance to see if these signals coincide with your trading ideals before executing. The down side is that you will need to be around your computer when these signals come in so that you don't enter the trade too late or miss the trade opportunity all together. Two examples of such signal service is Signal Forge (Auto) and BKForex (Manual). Will provide more on these services in a later post.
 

Your next step



With the information provided above there are a few things you should do depending on where you are in your trading business. If you are a beginning trader then you should research more and gather additional information that will enhance your trading strategy. After your research is completed then you can test out a signal service on a demo account to see how it functions. If it performs to your satisfaction then you can go ahead and put it on a live account. Keeping in mind that live and demo accounts may be slightly different, don't put it to work on all of your money at once.
If you are an experienced trader then you can check out the various signal services that exists and use one that you are satisfied with.

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Monday, 3 April 2017

Live PAMM Account report 2

As a refresher on what PAMM is all about go ahead and read the previous Article on How to invest while you are busy before reading my report so you can get an understanding of what is going on. Also read my first PAMM account report to see how this investment is progressing.

Current statistics for the PAMM account manager i'm invested in listed below. This is for you to have an idea of how the account manager has performed.

General Info and overall Summary

Trading statistics


Daily Profit and Loss

Now that the background info is out of the way lets get into the reporting.

At the moment of typing this my account is up 2.08%. Between the last report and this one the account went down as far as 6.4% but climb back up over the past 2 weeks. This is possibly because the account manager trades mostly EURUSD and the USD has been climbing over the past two weeks based good economic reports coming out of the USA.

There will be more updates in another month so remember to check back then to see how everything is going. If you're willing to take this journey also you can do so by clicking the link below to create and account and get started.

Invest in a PAMM account to earn while you work.

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Monday, 27 March 2017

Trading Plan: From Formulation to Implementation


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Lets say you have been working on a trading plan and you finally have a workable one put together. The next step is to put your market strategy to a test on historical data to see how it would perform under certain conditions. The aim is to ensure that your strategy can perform profitably so you can go ahead and use it on a live market. This article will take you through the steps from formulating your plan you implementing it live.



Formulating the plan

First up is actually getting the plan put together and ensure that it is workable and doesn't take over your entire life. So, you will want to look into a few things such as;

  • Your trading goal
This will set out a SMART goal that you wish to accomplish from trading. SMART is an acronym for the guideline of setting goals. Your goal must be Specific, Measurable, Attainable, Realistic and Timebound. Your goal will be the steering for your strategy.
  • Timeframes you want to trade
It will be extremely time consuming and somewhat chaotic if you attempt to trade on all timeframes. As such it is advisable to use at most 3 time frames when trading. One high time frame such as daily or weekly to indicate you the overall trend, One lower one such as 30 mins to give you and entry signal and the other one will be your main timeframe such as the one hour time frame. depending on your strategy you can use just one timeframe.
  • Trading Strategy
Your strategy will involve your trading instruments whether currencies only or currencies and commodities or whatever you choose to trade. It will also outline your entry and exit rules, your pre and post-market routines, what you will do during volatile economic events and also what your trading week will be. It will also involve your money management rules and risk management.
  • Behavioural Rules

Your behavioural rules will include certain controls that limit your emotional trading, revenge trading and anything that will take you away from following your strategy.

How to test the strategy

Testing a strategy might take some work and time if you attempt to do it manually. There are softwares available that can help in testing your strategy on historical data. The testing technique is called Backtesting. It is accomplished by reconstructing, with historical data, trades that would have occurred in the past using rules defined by a given strategy. The result offers statistics that can be used to gauge the effectiveness of the strategy. Using this data, traders can optimize and improve their strategies, find any technical or theoretical flaws, and gain confidence in their strategy before applying it to the real markets. The underlying theory is that any strategy that worked well in the past is likely to work well in the future, and conversely, any strategy that performed poorly in the past is likely to perform poorly in the future.

Read more on Backtesting


Is the Strategy successful

A strategy is considered successful when is at or above a 75% success rate. This can be determined when you backtest your strategy. After testing the strategy and seeing its success rate if it doesn't meet the benchmark then you should look at the test results and see what tweaks can be made to get it to higher success levels. Once a high success rate is achieved then you can go ahead can implement it on the live market.

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Wednesday, 22 March 2017

Market Influencers and their Impact Part 2


The other major currency up for discussion is the British Pound. The currency is the strongest in the world based on trading prices although USD is the most widely used. It is stronger than the Euro and the USD which makes it something to look at during your trading. The London trading session overlaps the New York session by approximately four hours. Within this time period there is normally a huge amount of volatility which is welcomed by many traders but can blow away others. Below we will focus on some of the key economic events that might trigger the Pound to behave erratically. Keep in mind that the following events are only a few that happens and as such you should always check your economic calendar before trading. A good one can be found at Investing.com.

Bank of England


Mark Carney the current and 120th Governor of the Bank of England is a Canadian with huge powers over monetary policies as he is also the chairman of the Monetary Policy Committee. He has a major role in guiding national economic and monetary policy and is therefore one of the most important public officials in the United Kingdom.

Mr. Carney is the UK's equivalent to the USA's Janet Yellen which his speeches are watched carefully by traders over  the world as they carry much weight on the GBP. His speeches can cause almost immediate reactions and send the currency either spiraling out of control or climbing way out expected range.

Manufacturing Purchasing Manager's Index



If a country doesn't produce then it is dependent on imports which drives the currency down and inflation up. Manufacturing is a key indicator to the health of a country's economy. UK is a major manufacturing country and each months the previous month's data is released. The Manufacturing Purchasing Managers' Index (PMI) measures the activity level of purchasing managers in the manufacturing sector. A reading above 50 indicates expansion in the sector; below 50 indicates contraction. Traders watch these surveys closely as purchasing managers usually have early access to data about their company’s performance, which can be a leading indicator of overall economic performance.

A higher than expected reading should be taken as positive/bullish for the GBP, while a lower than expected reading should be taken as negative/bearish for the GBP.

Prime Minister


Theresa Mary May is the Prime Minister of the United Kingdom and Leader of the Conservative Party, having served as both since July 2016. She has been the Member of Parliament for Maidenhead since 1997. She assumed office on 13 July 2016, following the resignation of David Cameron. She is the first female prime minister since Margaret Thatcher.

Similarly to the president of the USA, the Prime Minister of the UK has a great influence over the direction of the Pound Sterling. Her speeches normally have traders listening keenly to her addresses and any inclination of something that might be taken as a negative impact on the economy will send the pound down while anything positive will send it up.

Gross Domestic Product


Gross Domestic Product (GDP) measures the annualized change in the inflation-adjusted value of all goods and services produced by the economy. It is the broadest measure of economic activity and the primary indicator of the economy's health.

A higher than expected reading should be taken as positive/bullish for the GBP, while a lower than expected reading should be taken as negative/bearish for the GBP.

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Tuesday, 7 March 2017

Market Influencers and their Impact Part 1

The market is impacted by multiple influences on a day to day basis. These influences either have a negative or positive impact on the currencies that are traded which will determine what happens to your account balance. This is why it is always advisable to check an economic calendar each day before you start trading. There may be high impact events happening throughout the day or week that will definitely give a different perspective when you start trading. In this weeks blog we will look at the USA and some of its market affecting events.
Investing.com is used as an economic calendar source. You can check it out too. Keep in mind that the items below are only a few of the events that affects the market. There a lot more events either of the same impact level or lower.


President


First up is the POTUS himself, whoever it is that is in office has the power to cause huge market swings in an instant. This happens when the president makes public speeches or sign some agreement with a foreign nation. The president will speak on anything from nation building steps to policy development and when he does the public listens and responds. If the president's address is seen as good by the market then it responds accordingly and most likely the USD will gain, fast and huge, against all other currencies. Conversely if the president's address forecast gloom the greenback will fall against its counterparts.

As for trading when the president will speak, it is a high risk moment and most decide to close all trades at such points in time as they aren't sure which impact it will have on the market. Generally after the president's impact is felt by the currency, the market normally calms down and gets back into rhythm. It's best practice to not trade this event as it can wipe out your account if it goes against you. If you trade it always ensure you have proper risk management in place.

Feds


The Federal Reserve also called the Feds (Not the FBI) control interest rate hikes. The current Chairperson for the Fed is Jannet Yellen(February 2014 - February 2018) and as such makes her have more influence over the USD than any other person including the the president. Whenever she speaks the world listens and responds accordingly.

Her comments normally cause short term spikes with positive or negative effect in the market. She has an important address coming up this month(March) where she will address interest rates. Keep an eye out for this while you trade. All of her speeches are broadcasted for the world to see so when the market responds so will your account balance.

NFP


NFP or non-farm payroll is stats on the earnings of the population that is not in the farming sector. This helps to tell the health of the economy and the working class. It measures the change in the number of people employed during the previous month, excluding the farming industry. Job creation is the foremost indicator of consumer spending, which accounts for the majority of economic activity.Better than expected numbers means that people are earning more while the opposite means earnings are down.
This event is an extremely high impact one as seen from previous market impact. When the number come out higher than expected it normally gives the greenback a boost and market sentiments increase with the dollar trending up against its counterparts. When it comes lower than expected the market responds accordingly and trends down. Be careful when trading while this event is occurring. Ensure that risk management is considered or stay away from trading for that time if you are unsure what will happen.

Oil Reserve


WTI (West Texas Intermediate) and Brent Oil as well as world oil prices is normally affected by this event. The USA stockpile's oil in their inventory and a particular amount is expected, normally recorded in millions of barrels. If the US stockpile is higher than expected then oil prices drop globally. This event is just one indicator of world oil prices but it is a huge determinant for WTI and Brent oil that is being traded on the New York Mercantile Exchange (NYMEX).

This indicator also affects the USD whenever it happens as higher than expected oil reserve cause a drop for the USD against its currency counterparts while lower than expected may see a rise in the USD as people try to buy more oil. Oil is traded in USD and as markets buy more oil then more USD is needed in the market place so the demand increase and so does its value.


PMI

The Institute of Supply Management (ISM) Non-Manufacturing Purchasing Managers' Index (PMI) (also known as the ISM Services PMI) report on Business, a composite index is calculated as an indicator of the overall economic condition for the non-manufacturing sector. The NMI is a composite index based on the diffusion indexes for four of the indicators with equal weights: Business Activity (seasonally adjusted), New Orders (seasonally adjusted), Employment (seasonally adjusted) and Supplier Deliveries. 

A reading above 50 percent indicates the non-manufacturing sector economy is generally expanding; below 50 percent indicates the non-manufacturing sector is generally contracting. The Non-Manufacturing ISM Report on Business is based on data compiled from monthly replies to questions asked of more than 370 purchasing and supply executives in over 62 different industries representing nine divisions from the Standard Industrial Classification (SIC) categories. Membership of the Business Survey Committee is diversified by SIC category and is based on each industry contribution to Gross Domestic Product (GDP). 

A higher than expected reading should be taken as positive/bullish for the USD, while a lower than expected reading should be taken as negative/bearish for the USD.


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Tuesday, 21 February 2017

My live PAMM account report

Hotforex Pamm V2

SO I decided to open a PAMM account to put it to the test over a 3 month period. This is aimed putting the system to the test and following up with updates to let you know how its progressing. To find out more about how PAMM works click on either of the links below and read before getting started:


Starting off with a small investment so as to limit loss I invested with an account manager that has a 5% success fee, 30 days investment time period and 5%penalty for early withdrawal. The aim is to test the system fully and also become a PAMM account manager eventually.

At the end of January the account had depreciated but not very badly. It went down about 6%. This should be expected as it is Forex and you can actually lose some or all of your funds. On the other hand worry wasn't in the equation as the consequences and risk were considered and research conducted on the fund manager to be invested in. The fund manager profile shown a lot potential and the P/L numbers were good. Draw down was not bad either and overall winners versus losers were excellent with winners seeing a huge portion of the stats.

Its now the nearing the end of February and the account balance has now gone back up above what was deposited and seems to be climbing more and more. Currently seeing a 4.48% growth on the initial capital. There will be more updates in another month so remember to check back then to see how everything is going. If you're willing to take this journey also you can do so by clicking the link below or the image above to create and account and get started.


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Friday, 10 February 2017

High Probability trades


High profitability traders only take trades that have a high probability of working in their favour. Hence having consistent high profits from the market. High probability trades have a particular make up that should always be followed when trading. Support and Resistance or Supply and Demand is the major indicators used by high profit traders. Trend following is next in line as the trend should always be your friend. Traders who follow the trend and know its reversal points are always consistently profitable. Pattern and technical traders use specific rules to ensure that they enter and exit the trend at the right time. All Trades should be taken with confluence and explicit evidence of what is going on in the trade.

Support and Resistance


In technical analysis, support and resistance is a concept that the movement of the price of a security, will tend to stop and reverse at certain predetermined price levels. These levels are denoted by multiple touches of price without a breakthrough of the level.
A support is a zone which the price of a pair tend to have difficulty falling below it while Resistance is a zone where the exchange rate has difficulty breaking above. Most of the times these levels will hold true and price will bounce up from a support level and fall from a resistance level.
Traders normally keep an eye out for these levels as they, in confluence with other markers, provide high probability trade entry points. There are times when price breakout of some of these levels so it is always advisable to look for confirmation before entering a trade. Some traders use indicators to confirm their trade while others use price action and seek bullish evidence at a support level to see if price will bounce and also bearish evidence at a resistance level to see if price will fall.

Trend


"The trend is always your friend' is a common but absolutely accurate term that is used in trading whether Forex, stocks or futures. Following a trend can lead to huge profits and a mega boost to your trading account. Hence it is always good to know what kind of trending is taking place, when to get in the trend and obviously when the trend ends so you can collect your profits and exit the trade.
Therefore high probability trades take into account trading with the trend and following it until it ends. Your trading strategy needs to identify trends and the best entry and exit points.
There are different types of trends and it is always good to know which one you're in at the moment so most of your trades will take place in that general direction. A good way to look at the trend is to go on a time frame such as daily, weekly or monthly to see what's been happening in the market for that entity. Some traders use resistance and support regions to identify entry and exit points, others use patterns to spot reversals or continuations, while other traders use indicators and fundamentals to follow their trade. The key is always to incorporate the trend in your trading strategy so as to increase your profitability.

Confluence


Confluence by definition is;
noun
  1. A flowing together of two or more streams, rivers, or the like.
  2. Their place of junction.
  3. A body of water formed by the flowing together of two or more streams, rivers, or the like.
  4. A coming together of people or things; concourse.
  5. A crowd or throng; assemblage.
Therefore in forex trading it is when multiple indicators, signals or price action story is indicating the same thing. So for example you are using a slow and a fast moving average, the MACD and Resistance and Support levels. Then price reaches a support level and is bouncing off of it, the fast moving average is crossing above the slow one and the MACD is moving above the zero. All these factors is an indication that or has a high probability that the price will go up. Here we say you are trading with confluence since multiple indicators are saying the same thing. Trading this way gives high profit trades.
On the other hand although trades executed with confluence produces high profit trades, waiting for too much things to come together may provide limited amount of signals. Therefore there needs to be an optimal amount of things to wait on to come together to give a signal otherwise you might be waiting for an extremely long time to get one trade.

News impact


Trading news impact can be costly as it can be profitable. The news can cause much volatility which can lead to trades stopping prematurely or getting maximum profit. Therefore you should always check to verify what is happening in the news before you start trading. Most traders make it a part of their pre-trade routine to check the economic calendar for high volatility news events. As a trader I rarely trade news events as most of them cannot be accurately predicted and the market normally responds in a reactive way to news be it negative positive or what was forecasted.


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Wednesday, 4 January 2017

Live Trading: Don't get steamrolled


Lets say you have been demo trading for a couple months and you strongly believe that you are ready to go live and risk your own money. However, when you start live trading everything seems to be going different from demo trading. How do you avoid this? How do you ensure that you don't get steamrolled by live market volatility? How do you suppress your emotions so you can trade successfully?

There is a set of principles to follow to ensure your success. Continue reading to find out more.

Risk Management


The art of managing your money so you gain maximum returns while minimizing your loss. This statement encompasses the essence of what risk management is all about. It is recommended and should be taken as a principle of trading that you don't risk more than 1% of your trading account on any one trade. This will ensure that you don't lose more than you can afford to. Also ONLY enter trades that gives a risk to reward ratio of 1:3 or better, that means each and every trade that you enter in the event you win it should be three times as much if you had lost that trade. For example, if you enter a trade and based on your entry triggers your stop loss is placed where the possibility exist that you will lose $100 then your take profit should be at a point where you will win $300.

Risk management can be a tedious process but should always be done and ensure that you follow the principles:
1. Never trade more than 1% of your account on anyone trade
2. Always ensure risk to reward radio is always 1:3 or better

Trading Plan



This is where you outline all the steps you will take to complete a trade. The steps will involve
1. When to enter the trade
2. Why you will enter the trade
3. When you will exit the trade
4. Why you will exit the trade
5. How many trades you will make for each trading day
6. When will be your trading days (Look at it as a business and as such your business will need closing and opening hours)
7. How much you will put on each trade (Remember risk-to-reward ratio mentioned above)

Your trading plan should always be followed but it can be tweaked if any points for improvement are found while trading. You can consider your trading plan to be a good one when its success rate is 65% or higher. Having a trading plan is a key principle in trading and should always be adhered to otherwise the consequences can be costly.

Keep a trading journal as part of your trading to ensure that you can revisit your trades and analyze them to find out where any adjustments to your trading strategy is needed.

Emotional Control


No one wants to lose their money, however, trading is extremely risky and more often than not traders lose. The aim is to always keep your emotions in check to ensure that you don't worry too much about losing and focus more and executing the plan.

Demo trading helps you to tweak and refine your trading plan but not necessarily to control the trade emotions. You can pretend that your trading your own money but it isn't quite the same. the real emotions kick in when you put your hard-earned money on the line. the fear losing kicks in and you start to make extremely high risk trades. the key in curbing this is to always stick to your trading plan no matter what. you will lose some trades which is expected but sticking to the plan means your overall statistics will show better.

It's always advised to keep emotions out of trading.

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