Forex Trading Education For The London Open
A thorough Forex trading education must include an understanding of the effect market timings can have on trading and liquidity.
Around the time of the London open there is much market activity and you can be presented with good trading opportunities.
Add London open analysis to your Forex trading education and see if you can recognize good setups from the lively market conditions.
The following questionnaire and checklist will help.
London Open Preparation
Check these points about fifteen minutes to half an hour before the London market opens:
MACD indicators on the 4 hour and 1 hour charts - if they are not going in the same direction exercise great caution!
Look out for divergence on the MACD on the 4 hour, 1 hour or 15 minute chart. Then check to see if there are any other signs price may go in the direction of the divergence.
On the 4 hour chart what is the overall trend?
Do a Fibonacci calculation on the last swing high and low and see if price is pulling back to an optimum retracement level or whether it is reaching a key extension level.
Note price in relation to the 200 EMA (Exponential Moving Average) on the 4 hour, 1 hour and 15 minute charts. Is price bucking the trend? In other words, is price above the 200 EMA on the 4 hour and 1 hour chart but below it on the 15 minute? Then be prepared for price to go long at some stage. (Draw the opposite conclusion if price is below the 200 EMA on the 4 hour and 1 hour chart but above it on the 15 minute chart.)
Are any Economic Reports imminent?
Looking at the candle that closes the first 15 minute period after London opens, do you see any distinctive patterns, or is the candle itself a doji or a hammer or any other shape indicating price exhaustion?
What would my risk be and where would I place my stop if I entered a trade right now in a particular direction?
After waiting a few minutes from the time London opens, and you see a number of converging factors based on the analysis points given above, decide whether you are going to enter the market. Either:
trade
wait for clearer signals or a better entry point
This kind of analysis carried out at the time the London market opens will certainly increase your Forex education and possibly provide you with a number of excellent trading opportunities.
You will be able to fine tune your analytical skills and be in touch with the underlying feel of the market.
Forex trading education does not depend on a magical formula. What it does entail is years of work, study, practice and experience, often hard earned through watching many trades go bad.
Finally, the trader learns the emotional and mental disciplines necessary for successful trading - no doubt the most important part of Forex trading education.
A procedure like the one outlined above, practiced day in and day out, will help the newer trader make good progress. It won't be too long before the trader experiences the satisfaction of consistent profits on a regular basis. - 23229
Around the time of the London open there is much market activity and you can be presented with good trading opportunities.
Add London open analysis to your Forex trading education and see if you can recognize good setups from the lively market conditions.
The following questionnaire and checklist will help.
London Open Preparation
Check these points about fifteen minutes to half an hour before the London market opens:
MACD indicators on the 4 hour and 1 hour charts - if they are not going in the same direction exercise great caution!
Look out for divergence on the MACD on the 4 hour, 1 hour or 15 minute chart. Then check to see if there are any other signs price may go in the direction of the divergence.
On the 4 hour chart what is the overall trend?
Do a Fibonacci calculation on the last swing high and low and see if price is pulling back to an optimum retracement level or whether it is reaching a key extension level.
Note price in relation to the 200 EMA (Exponential Moving Average) on the 4 hour, 1 hour and 15 minute charts. Is price bucking the trend? In other words, is price above the 200 EMA on the 4 hour and 1 hour chart but below it on the 15 minute? Then be prepared for price to go long at some stage. (Draw the opposite conclusion if price is below the 200 EMA on the 4 hour and 1 hour chart but above it on the 15 minute chart.)
Are any Economic Reports imminent?
Looking at the candle that closes the first 15 minute period after London opens, do you see any distinctive patterns, or is the candle itself a doji or a hammer or any other shape indicating price exhaustion?
What would my risk be and where would I place my stop if I entered a trade right now in a particular direction?
After waiting a few minutes from the time London opens, and you see a number of converging factors based on the analysis points given above, decide whether you are going to enter the market. Either:
trade
wait for clearer signals or a better entry point
This kind of analysis carried out at the time the London market opens will certainly increase your Forex education and possibly provide you with a number of excellent trading opportunities.
You will be able to fine tune your analytical skills and be in touch with the underlying feel of the market.
Forex trading education does not depend on a magical formula. What it does entail is years of work, study, practice and experience, often hard earned through watching many trades go bad.
Finally, the trader learns the emotional and mental disciplines necessary for successful trading - no doubt the most important part of Forex trading education.
A procedure like the one outlined above, practiced day in and day out, will help the newer trader make good progress. It won't be too long before the trader experiences the satisfaction of consistent profits on a regular basis. - 23229
About the Author:
For a free candle & chart pattern recognition reference tool click here: Candle Charting See how to use trendlines to get an optimum trade entry point: Trendline Trader
posted by X - Men @ 2:34 AM
0 Comments
0 Comments:
Post a Comment
Subscribe to Post Comments [Atom]
<< Home