Leading vs. Lagging Indicators

Leading vs. Lagging IndicatorsLeading IndicatorsAn index published monthly by the Conference Board used to predict the direction of the economy’s movements in the months to come. The index is made up of 10 economic components, whose changes tend to precede changes in the overall economy.
These 5 components include:1. the average weekly hours worked by manufacturing workers.2. The average number of initial applications for unemployment insurance.3. The amount of manufacturer’s new orders for consumer goods and materials.4. The speed of delivery of new merchandise to vendors from suppliers.5. The amount of new orders for capital goods unrelated to defense.

The Million Dollar Question

How do you figure out whether to freakin’ use oscillators, or trend following indicators, or both? After all, we know they don’t always work in tandem.For now, just know that once you’re able to identify the type of market you are trading in, you will then know which indicators will give accurate signals, and which ones are worthless at that time. SummaryThere are two types of indicators: leading and lagging.A leading indicator gives a buy signal before the new trend or reversal occurs.A lagging indicator gives a signal after the trend has tarted .Technical indicators into one of two categories: Oscillators and trend following or momentum indicators.

Double Bottom

A charting pattern used in technical analysis. It describes the drop of a stock (or currency), a rebound, another drop to the same (or similar) level as the original drop, and finally another rebound.The twice touched low is considered a support level.Most technical analysts believe that the advance off of the first bottom should be 10-20%. The second bottom should form within 3-4% of the previous low, and The volume .

Ascending Triangles

A bullish chart pattern used in technical analysis, which is easily recognizable by the distinct shape created by two trend lines. In an ascending triangle, one trend line is drawn horizontally at a level that has historically prevented the price from heading higher, while the second trend line connects a series of increasing troughs.An ascending triangle is generally considered to be a continuation pattern, meaning that it is usually found amid a period of consolidation within an uptrend. Once the breakout occurs, buyers will aggressively send the price of the asset higher, usually on high volume. The most common price target is generally set to be equal to the entry price plus the vertical height of the triangle.

Descending Triangles

A bearish chart pattern used in technical analysis that is created by drawing one trend line that connects a series of lower highs and a second trend line that has historically proven to be a strong level of support. Traders watch for a move below support, as it suggests that downward momentum is building.This is a very popular tool among traders because it clearly shows that the demand for an asset is weakening, and when the price breaks below the lower support, it is a clear indication that downside momentum is likely to continue or become stronger.

SMA vs. EMA

EMA:IT HELPS TO SHOW RECENT PRICE SWINGS AND FAST MOVINGSMA:HELP TO SHOW EASY CHART, AND ELIMINATE THE FAKEOUTS. IT’S UP TO YOU TO DECIDE WHICH ONE IS BETTER TO USE A LOT OF TRADERS PLOT DIFFERENT MOVING AVERAGES TO GIVE THE SIDES OF THE STORY. THEY SHOULD USE THE SIMPLE MOVING AVERAGE TO FIND WHAT IS THE OVERALL TREND, AND ALSO USE THE EXPONENTIAL MOVING AVERAGE TO FIND THE BETTER TIME TO ENTER THE TRADE TIME.Read More : www.forexgen.com

ForexGen Opens Doors for Complaints

I haven’t been able to make any progress monetarily in about a month. I’m up about 4% this month but breaking my account balance all-time high has been a struggle. I’m pretty much stuck where I was around this time last month. I’m not all that concerned and shouldn’t be considering I was preaching patience a couple of days ago. It’s just that every time I open my trading platform, the account balance is just staring me in the face. Read more…

Strategy tester

will enable the traders to apply more than one strategy for one or multi pairs and simulate these strategies in history to see the results of these strategies and try to tune its parameters to achieve its maximum profit and minimum loss.
The system offers reporting facilities to the traders to save the results of each applied strategy and their total profit/loss.
The strategy tester uses the following two components to carry out its process.
Validator
- Validates the prior used strategy to be applied on the historical data.
- Integrate with the optimizer to filtrate the pair’s loops generated by the optimizer.
- Accept ranges from different parameters to enable selecting the ideal setup to produce the maximum expected profit. Verifier - Scoring and ranking the time results from using the strategy.
- Providing the trader with feedbacks on different strategies performance.

Relative Strength Index (RSI)

Relative Strength Index, or RSI mean
A technical indicator used to compare the magnitude of recent gains to recent losses to determine overbought and oversold conditions in the market. . It can be calculated using the this formula:
RSI=100100- 1+rs
readings below 20 refer to oversold, while readings over 80 indicate overbought. the RSI ranges from 0 to 100
The RSI is best used as a valuable complement to other stock-picking tools. Relative Strength Index, or RSI, is like the stochastic in that it means overbought and oversold conditions in the market.

ForexGen`s MACD

Used to catch trends early and can also help us spot trend reversals .
It consists of 2 moving averages (1 fast, 1 slow) and vertical lines called a histogram, which measures the distance between the 2 moving averages.
Contrary to what many people think, the moving average lines are NOT moving averages of the price. They are moving averages of other moving averages.
MACD’s downfall is its lag because it uses so many moving averages.
One way to use MACD is to wait for the fast line to “cross over” or “cross under” .

Putting It All Together With ForexGen

Bollinger Bands
Used to measure the market’s volatility.
They act like mini support and resistance levels.
Bollinger Bounce.
A strategy that relies on the notion that price tends to always return to the middle of the Bollinger Bands.
You buy when the price hits the lower Bollinger band.
Bollinger Squeeze
A strategy that is used to catch breakouts early.
When the Bollinger bands “squeeze” the price, it means that the market is very quiet, and a breakout is eminent

ForexGen Putting It All Together

In a perfect world, we could take just one of these indicators and trade strictly by what that indicator told us. The problem is that we DON’T live in a perfect world, and each of these indicators has imperfections. That is why many traders combine different indicators together so that they can “screen” each other.
We urge you to study each indicator on its own until you know EXACTLY how it reacts to price movement, and then come up with your own combination that fits your trading style. Later on in the course, we will show you a system that combines different indicators to give you an idea of how they can compliment each other.
Everything you learn about trading is like a tool that is being added to your trader’s toolbox. Your tools will make it easier for you to “build” your trading account

CandleStick Patterns & Reversal Patterns

What do Candlesticks look like?
Candlestick charts are much more visually appealing than a standard two-dimensional bar chart. As in a standard bar chart, there are four elements necessary to construct a candlestick chart, the OPEN, HIGH, LOW and CLOSING price for a given time period.
The body of the candlestick is called the real body, and represents the range between the open and closing prices. A black or filled-in body represents that the close during that time period was lower than the open, (normally considered bearish) and when the body is open or white, that means the close was higher than the open (normally bullish). The thin vertical line above and/or below the real body is called the upper/lower shadow, representing the high/low price extremes for the period (one period of time measures the duration of selling or buying within the market).

Basic Candlestick Patterns

Candlesticks with a long upper shadow, long lower shadow and small real bodies are called spinning tops. The color of the real body is not very important.
The small real body (whether hollow or filled) shows little movement from open to close, and the shadows indicate that both buyers and sellers were fighting but nobody could gain the upper hand.
If a spinning top forms during an uptrend, this usually means there aren’t many buyers left and a possible reversal in direction could occur.
If a spinning top forms during a downtrend, this usually means there aren’t many sellers left and a possible reversal in direction could occur.

What is a Candlestick?

While we briefly covered candlestick charts in the previous lesson, we’ll now dig in a little and discuss them more in detail.
Back in the day when Godzilla was still a cute little lizard, the Japanese created their own old school version of technical analysis to trade rice. A westerner by the name of Steve Nison “discovered” this secret technique on how to read charts from a fellow Japanese broker and Japanese candlesticks lived happily ever after. Steve researched, studied, lived, breathed, ate candlesticks, began writing about it and slowly grew in popularity in 90. Candlesticks are formed using the open, high, low and close.
If the close is above the open, then a hollow candlestick (usually displayed as white) is drawn.
If the close is below the open, then a filled candlestick (usually displayed as black) is drawn.
The hollow or filled section of the candlestick is called the “real body” or body.
The thin lines poking above and below the body display the high/low range and are called shadows.
The top of the upper shadow is the “high”.
The bottom of the lower shadow is the “low”.

ForeGen`s Chart

All charts are potted with time on the x-axis and the currency pair on the y-axis. Each time period on our real time charts can range from a tick by tick a weekly interval (the tick refers to each individual pip movement).
Here’re the most popular types of charts:
Line Charts
A line chart simple a graph of the value of a currency taken at regular time intervals based on current prices. Below is a LINE CHART.
Bar Charts
Bar chart is graphic representation of price action using a vertical bar to connect the highest price to the lowest price during a period. The opening price is displayed as a horizontal line on the left side of the bar.The closing price is displayed as a horizontal line on the right side of the bar.Bar charts can be constructed for any time period in which prices are available. Traditionally, the most popular time interval for bar chart is hourly chart. However, since the wide availability of the real time prices, it is commen to use smaller time interval such as 30 minutes, 15 minutes, 5 minutes, 1 minuteBelow is a BAR CHART
Candlestick Charts
Candlestick Charts identical to a bar chart in the information conveyed, but presented in an entirely different visual context. The candlestick encapsulates the open, high, low and close of the trading period in a single candle.Candlestick charts are much more visually appealing than a standard two-dimensional bar chart. As in a standard bar chart, there are four elements necessary to construct a candlestick chart, the OPEN, HIGH, LOW and CLOSING price for a given time period. Below are examples of candlesticks and a definition for each candlestick.

Technical analysis

Technical analysis is a method used to evaluate the worth of a security by studying market statistics. Unlike fundamental analysis, technical analysis disregards an issuer’s financial statements. Instead, it relies upon market trends to ascertain investor sentiment to predict how a security will perform.If you want to use technical analysis to help you make an investment decision, you will refer to financial charts, tables and ratios found in the financial press.
Technical analysis can be conditionally divided into some main parts such as:
Types of charts.
Graphical methods.
Analytical methods.
Technical indicators.

Types of Trading Analysis

There are 2 types of analysis you can take when approaching the forex: Fundamental analysis and Technical analysis. There has always been a constant debate as to which analysis is better, but to tell you the truth, you need to know a little bit of both.
Fundamental analysis:
Fundamental analysis is a method used to evaluate the worth of a security by studying the financial data of the issuer. It scrutinizes the issuer’s income and expenses, assets and liabilities, management, and position in its industry. In other words, it focuses on the “basics” of the business.

Protect Your Self

Before we go any further we are going to be 100% honest with you and tell you the following before you consider trading currencies:
All forex traders traders LOSE money on trades
Ninety percent of traders lose money, largely due to lack of planning and training and having poor money management rules. Trading forex is not for the unemployed, those on low incomes, or who can’t afford to pay their electricity bill or afford to eat.
The Forex market is one of the most popular markets for speculation, due to its enormous size, liquidity and tendency for currencies to move in strong trends.
Many traders come with the misguided hope of making a gazillion bucks, but in reality, lack the discipline required for trading. Most people usually lack the discipline to stick to a diet or to go to the gym three times a week.

What are the five major currencies that you can trade?

Most trading platforms offer trading with:
-EUR (Euro)
-JPY (Japanese Yen)
-GBP (British Pound)
-CHF (Swiss Franc)
-AUD (Aussie Dollar)
all paired up against the USD, so there’ll be four main currency pairs that are heavily traded and that offer immediate liquidity most of the time.
Euro / US Dollar
US Dollar / Japanese Yen
British Pound / US Dollar
US Dollar / Swiss Franc

Pip Value Calculator

Pip value constantly changes according to the market currency price for indirect currency pairs.
Kindly enter the current value of the bid/ask of your desired pair in the price box then press retrieve button to get the pair pip value in dollar
Instructions
You may input any prices you need in the second column of the table. If you are using non-standard lots, you may input the size of your lot in the bottom cell.
Quick Review
ip (or Points) is a term used in Forex market to indicate the smallest incremental move an exchange rate can make. Depending on context, normally one basis point (0.0001 in the case of EUR/USD, GBD/USD, USD/CHF and .01 in the case of USD/JPY).

Pivot Calculator

The pivot calculator is defined as a technical indicator that is produced by calculating the numerical average of a particular currency pairs high, low and closing prices.
To calculate pivot points, the pivot point itself will be considered as the primary support/resistance level. Meaning that the largest price movement will occur at this level.
Pivot points can be used in two ways. The first way is to determine the expected overall market trend.
The pivot points are considered as short-term trend indicators, and can be useful for only short term trading “e.g. one day” until its recalculated. The second way is to use pivot price levels to determine when is the best time to enter and exit trades in the market.
Pivot points enable traders to take a look at price levels which are likely to cause an expected price movement.

Patterns Recognizer

Technical analysts in the Forex market found that by observing the candlesticks patterns, there are recurring patterns on the candlestick charts. Such patterns are like recurring pictures on the candlestick charts and they tend to occur when a trend is about to end or reverse its direction.
Why are candlesticks patterns important?
The answer for this question is quite simple because candlesticks represent true status of what is going on in the market at the current moment.
Finally, candlesticks patterns can be easily used to determine potential reversals of the current trends in the market - most likely when used at the same time with other technical indicators. By constantly observing the candlestick patterns, traders can observe potential reversals of trends and have good opportunities to join the market with strong indication of what will go on next.

Trading Glossary

APPRECIATION:
A currency appreciates when it strengthens in price.
ASK RATE:
The rate at which traders can currently buy a particular currency.
ASSET ALLOCATION:
Investment practice that divides funds among different markets to achieve diversification for risk management purposes .
BASE CURRENCY:
The currency in which an investor keeps his book of accounts. In the Forex market, the US dollar is normally considered the base currency for quotes.
BEAR:
A person who thinks that market prices will decline.
BERAR MARKET:
A market that is characterized by declining prices.
BID RATE:
The rate at which traders can currently sell a particular currency

ForexGen Academy

If you are an experienced ‘FOREX’ Trader or just a beginner looking for the opportunities offered in the ‘FOREX’ market, Forexgen has created ForexGen Academy to give you the chance to get a ‘FOREX’ education and improve your trading skills.
How to Get Started?
People are introduced to the exciting world of foreign exchange in many ways: friends, current events, newspapers, television, and many others.
Step 1: Practice makes perfect
Demo trade. The demo account was designed to help traders gain familiarity with the speed and movements of the market. When you are demo trading, you should learn how to: 1) place market orders to enter a trade, 2) place stop-loss orders to protect your positions, and limit orders to take profits, 3).
Step 2: Study, Study, Study
Forex traders use fundamental analysis, technical analysis, quantitative analysis and sometimes a combination of all three to make their trading decisions. Fundamental analysis involves the use of economic, financial and political news to determine trading decisions.
Step 3: Manage your money wisely
You should always be aware of the amount of money in your account before placing a trade. If you think a long-term trend is developing, then you should consider whether you have enough funds to maintain your margin and withstand any movements against your position(s) that may occur.

What is FOREX ?

The Foreign Exchange Market, better Known as FOREX, was established in 1971 when fixed currency exchanges were abolished. Currencies became valued at ‘floating’ rates determined by supply and demand. The FOREX grew steadily throughout the 1970’s, but with the technological advances of the 80’s FOREX.
The Foreign Exchange Market, is a worldwide market for buying and selling currencies. It handles a huge volume of transactions 24 hours a day, 5 days a week. Daily exchanges are worth approximately $2.6 trillion (US dollars).

Dash Board for all indicators

Dashboard for all is an assisting tool that includes 27 currency pairs, it allows traders to see the CIF values for the selected currencies on one chart. It represents the buy/sell signal by a percentage of different strengths (short, long, and middle). The dashboard for all calculations for each currency pair depends on, volumes and correlations between strategies including a function that weights the indicators’ signal depending on strategies based on trend, oscillators, bill Williams, volumes and custom indicator; it gets the average signal among all the strategies over a specific time frame.
Indicator features:
Showing more than one currency pair on the same chart sorted by spread ascending.
Showing average, short, middle and long term CIF values beside CIF values for all pairs.
The ability to select directly all currency pairs to be shown.
The ability to store current CIF values in a text file for the selected currency pairs.
The ability to show or hide all currency pairs (hide them while storing in file).
The following screen is to select the desired pairs to represent their CIF values on the current chart.

Multi Pair Chart Indicator

The multi pair chart indicator allows putting multiple currency pairs on a host currency chart and draw the difference between the these currencies.
The multi pair chart is an indicator which represents more than one pair symbol, it creates further correlations between the pairs through hedging.
It simulates the expected relations between more than one symbol to be more useful and to facilitate the trading process.

Trading Profit/Loss

The differential indicator is an indicator used to identify the profit/loss that would have been realized if any trader submitted multiple positions at the same time.
The indicator shows the rise and fall of the profit of positions opened at the red vertical line through a red graph line in a certain interval of time starting from the time of opening the positions and reaching to the current time, where each point is the total profit of opened positions at this time.

Trading Optimizer

The Trading Optimizer’s main functionality is to create relations between groups of pairs and finding the best combinations that may produces the best profit in the minimum time possible, this process is performed by sophisticated -state of the art- gorithms. The trading optimizer inputs are the pairs’ symbols. While, its outputs are the combinations of the pairs that reached the most expected profit in the history. In the following screen traders select the desired optimization type:
Fixed open variable closes.
Variable opens variable closes.
Variable opens fixed close.