Archive

Category Archives for "Articles"

How to take your trade entry at First stab

Do you take your trade at 1st stab or do you rather wait for confirmation?

First stab will give you the best opportunity to manage and remove risk out of the position much sooner compared to waiting on confirmation.

To be successful with first stab entry, you will need a comprehensive understanding of price and the market.

First stab explained

It is important that we understand the meaning of first stab.

First thing to keep in mind is, we are never chasing price, we are always waiting on price to come to us.

In the Mastering Course we explain this very clearly, this concept alone can be difficult for traders to adopt. In order to take a trade at first stab we must:

  • Buy into the face of a bear candle
  • Sell into the face if a bull candle

We are not interested in the type of the candle or its name but we are interested in is price delivery thus how price arrives to our entry level.

Discover your key level

A First stab entry needs to be supported by a key level and as price comes into the level you take the trade on the first hit. This is by nature not what we do as humans. Most times in life we desire confirmation before committing to a situation. This also plays out in trading and it is something that most traders need to adjust to before becoming successful at trading.

Considerations when taking First stab

Nothing in trading is as simple as just an idea. All things need to be considered and trying to get everything to line up is near impossible.

Some of the factors that you should consider regardless if you are taking a trade at first stab or waiting for confirmation.

       1 – Time of day

       2 – Liquidity

       3 – News events

      4 – Price delivery. How price arrives to your entry

      5 – Price patterns (These are not traditional patterns but price liquidity patterns)

      6 – Key level

      7 – Definition at the key level (strong or weak)

      8 – Support – Resistance

Discomfort will create comfort

There are ways to become comfortable trading first stab, we discuss these methods within the Mastering course. Over time you will turn the discomfort of trading first stab into a comfort.

It is realizing that you have a much greater chance of survival by waiting for price to come to you and take it on first stab.

A metaphor for this is if you watch a documentary on an animal that stalks its prey.

The stalker will wait and wait until the prey is near enough before pouncing. This process increases the chance of a win for the stalker as well it saves energy.

In trading if you are chasing the price or waiting for confirmation, it will become mentally taxing.

The video included is from the Mastering Course. 1st stab Entry part – 1

https://eurusd-fxtrader.com/course/1st-stab-entry-part-1/

Happy trading,

Steve T.

Logo EURUSD Forex Trading

GET STARTED TODAY WITH A SPECIAL DISCOUNT!

LIMITED TIME ONLY!

For 48 hours only, you can get this course for only $199 instead of the normal price of $599!

Get started TODAY and don't miss out on this CHANCE!

00
Days
00
Hours
00
Minutes
00
Seconds

AND.... GET THESE THREE BONUSES INCLUDED!

EXCLUSIVE BONUS ONE  

3 HOUR VIDEO & HANDBOOK COURSE, FREE FOREVER!  

For a limited time only, ALL new Sign Ups will get our 3 hour Video Training Course 

"The 3 Most Reliable Trade Setups" completely for FREE!

This valuable video ($259), includes:

  • Exclusive and High Value Trade Setups!
  • 3 Hours of Video Content
  •  5 Training Modules
  • 14 Videos
  • Hand Book & 50 Slides

EXCLUSIVE  BONUS TWO   

ONE MONTH ACESS TO MASTERMIND INNER CIRCLE  FREE!

For a whole month you will be allowed to walk among the best traders, and get access to all the resources they have at their disposal. Of course, if you want to stay afterwards, your are more than welcome!

Excl​​​​​usive Weekly Webinar 'Wednesday Ask Me Anything

Every Wednesday, 1 hour Q&A Webinar, 2pm ACT-Canberra

Daily Session Previews with Trade Levels

Access to closed Mastermind Facebook Trading Group

Live Updates during Trading Sessions

Access to Live Updates in closed Mastermind Facebook Group

Weekly strategy video

Outlook on the coming trading week with insider tips

Fundamentals newsletter

Insight in long-term market trends and indicators on a bullish or bearish outlook

EXCLUSIVE BONUS THREE  

100% MONEY BACK GUARANTEE 

If this course somehow does not live up to your expectations, we will give you a FULL REFUND within 14 days of purchase!

How to Break The Losing Cycle

Why Most Traders Fail

Let’s define what failure is in trading terms. There really is only one event that signals failure and that is when the trader has detached themselves from self-discipline and the result is to blow up your trading account.

Most traders know having a string of losing trades is not a failure. It might be because of poor trade selection and over trading, but these are often signals for you to be aware of to adjust your approach.

Profits need to be added to your account gradually. Losers taken in the same way, gradual. Either way, it should not have any huge impact on your trading account or your trading psychology.

For most, there is the need for more. We all want more money, more things, more stuff, more time, etc. Traders want more gains. With the gains comes more exposure. The exposure then eats away at your trading psychology and your self-discipline becomes fractured.

The fractured mind is now struggling to see the reality and the process that is needed for disciplined trading success.

The Big Fail

What I am about to tell you is something that is the number one reason for retail traders failing. It is not because of anything else but this.

We need to talk about what is going on in the trader’s mind that causes this number one failure.

Traders fail because of one big trade. It is the one trade that they believe will reverse and take them back to break-even or a tiny loss. The same trade gets added to or better known as “averaged down”.

The initial trade in your mind would always be a winner. You never gave it a thought it could be a loser. This trade is worthwhile investing in due to various supportive reasons. As the trade moves against your original entry, you pin point another level to enter the trade. This now gives you an improved average entry.

At this stage, any money management rules have been broken, but you have quickly justified the position. Reality is, your judgement is clouded and very biased.

As the trade continues to work against you, your stress and frustration levels build as you identify another trade entry to average the entry level. Price only needs to pull back 50 pips to get you out of jail.

Your rotten luck continues and price has moved several hundred pips away from your original entry point and a margin call is nearing. You are in no state of mind to make any sound trading decisions. I liken this to a person who has had way too much alcohol before driving a car.

Getting out of this hole will take time, money and patience, these are the very things you are short of.

The outcome of the big fail normally leads to a trading account that has been smashed to pieces. Let’s look at why this happens.

Why it happens

Below is a list of reasons. Most traders will have most of these issues and thus the big fail.

  • A need to be right

In life most people do not except that they are wrong. They find ways to justify their position and prefer to blame people or circumstances rather than taking full responsibility for their situation.

This will play out in your trading even though you are not aware that this is happening. A need to be right makes us humans feel better about ourselves. Stripping back to self-reflection is not one of our better human traits.

  • Greed

I have mentioned in other blogs the need for more. Trading offers a great opportunity for more. It is the very thing that makes traders break money management rules.

Profits for most traders grow very slow but blow up their account in a brief moment.

The patients to build a trading account in a methodical manner is difficult for most. Once the greed function takes over, leverage is abused and the account is demolished.

  • A polluted mind

When you are in a situation that is not considered “normal” your body functions in a different state. If you have ever been in a road accident, physical fight or put out of your comfort zone, your brain will start to starve from oxygen. The result is that you do not think and respond to the situation that is best for your outcome. You become a different person. Fight or flight takes over.

When you have strayed away from self-discipline, your mind and physical state change. You now can no longer see clear, think rational and make trading decisions that will support you in a positive state.

Instead you look for the short term, quick turn-around home run solutions.

  • Letting go

To trade, you need to let go of outcome. As traders, we are looking for a high odds trading opportunity. There is no certainty of the outcome.

Day to day we try to control many of our daily events. The time we eat, go to bed, how we communicate situations, etc. We are conditioned to control, and the result is that we cannot let go.

Death for most is scary and we fight death. Perhaps this is because we have no control over when, where and how we die so we fight it our entire lives. What if we were to “let go” and allow nature to play out of its natural course, perhaps then we would have little fear of death and view it as a cycle of nature as one person makes way for the other?

Traders do not want to let go of outcome, They want to somehow influence and control the event. This is done by averaging into the trade with a do or die attitude.

  • Do not take it personally.

We view that our trade outcome (win or lose) reflects our own existence or who we are. By doing this,this we now apply this thinking upon our trades. If the trade is a winner, we are personally winners and if we lose; we are personally losers. We think the trade reflects who we are. It should not.

The trade is only a transaction with a chance of winning or losing. It is nothing more than this.

Because of us taking things in life personally, we take the losing trade personally as a negative of our being.

Many people say they do not take things personally. It is very difficult not to do so. Start thinking about how much we take personally. Every day we react to various situations because we take things personally.

Our trades are a simple financial transaction with a win-or-lose outcome. There is nothing personal.

We need to manage the trade with discipline and a focused approach, let the outcome be what it will be.

The book The four agreements’ has many helpful hints for traders.

  • We assume we know what will happen next.

The cycle continues. By using the need to be right, greed, polluted minds, unable to let go and taking things personally, we now assume that we know what will happen next.

By thinking this our mind is biased towards an outcome. It is an outcome we cannot control or even influence but yet we assume we know where price is heading and how it will respond.

By assuming what will happen next makes us feel good when the event is proven correct. This very endorphin release is a drug. This drug impedes us trading with the focus on execution, and instead we look at outcome.

Consider how often we make daily assumptions and how many of those assumptions can be wrong. How can we think that making assumptions upon the financial markets can be positive to our trading.

The Real Work

Trading will push you and shove you from one end of your mind to the other. You must be mentally stable whilst trading. You also do not want to overthink everything. Try to be in the flow without forcing yourself to be someone you are not.

Discover your discipline strength and weaknesses.

Successful trading is a road of self-discovery that is expressed through your trading results.

The Losing Cycle

You finally believe that you have shifted your trading ability to a level of profitability and consistency. After all, you have been trading with discipline and a small portion of good luck for several months.

The last time you had a major drawdown on your trading account was when you abused your leverage allowance and averaged into a trade. It was only a lapse in concentration otherwise it too would have been a winning trade and you swore that you would never make that same mistake again.

Over time, the pain of the “out of control” losing trade softens. We don’t forget but we believe that we have moved on and matured as a trader and will manage the situation better if this ever happens to you again.

Five Survival Techniques

Remaining grounded and in touch with your own emotions can be the most difficult situation to manage as a trader. Every trader will have a unique manner in how they view and trade the market. There is no right or wrong.

The real difference between success and failure will be how you manage yourself. The list below will give you hints on where you might need to develop as a trader to avoid the large drawdowns on your account.

  • Quality trade selection (Understanding the market)
  • Tight money management and risk control (Risk management model)
  • Excepting the trade outcome before you enter the trade (Understanding the flip of the coin)
  • Remaining humble win or lose (No room for ego)
  • Strong focus on process and not outcome (Manage pips not dollars)

Note that the five survival techniques above have everything to do with YOU. If a trader can become excellent at all five techniques, then success will follow. If the trader fails at just one of these, then it will be a race to the bottom.

Can you for a moment imagine that you have all five techniques mentioned totally anchored within your trading psychology? What type of trader would now be or could become if you mastered the list provided?

This is the secret to trading. Every trader will have a method or an approach that works for them, but without the development of your own mind, you will only lose at trading.

As a guide, it will take most new traders two to three years to be comfortable with a trading approach, trading platform and the market. It is after we have established this, we move towards self-development and this is where the true challenge for the trader begins.

Traders are polluted with advertising rubbish that offers traders an easy road to success. The truth is, there is no easy road to success. The success needs to be earned and if you hang in there long enough and become a well-rounded trader and person, success will gradually feed into your trading account.

The Forex Trading Greed DEMON!

I want to discuss percentage gains (and losses) traders broadcast on social media and within Facebook groups.

Retail traders push to gain 4% or more each week and see themselves in the window of success. Yet professional traders believe 1% or 2% gain per week is massive.

This overconfidence and pushing towards big gains is dangerous.  I warn about this in my E-Book,  control your account gains if you want to trade long term.

Professional traders see 1% - 2% as a solid success!

Retail traders scoff at this, arguing this is insignificant. Yet professional traders are around a long time while retail traders drop as flies. Do you wonder why? It's called leverage.

Retail trader and professional trader

There are usually differences between both types of traders. The professional trader will use a much lower level of leverage and sometimes no leverage at all, meanwhile the retail traders have a much smaller size account to trade from, and use leverage to bloat gains.

Most retail traders will counter saying, “How else can I make money unless I use leverage?” That’s a valid question; however, first thing to remember is that to play, you must stay in the game!

Most retail traders will blow up their trading account for these two reasons.

  • Abusing leverage
  • Average down the loss

Most traders will slip up and do both simultaneously.

Becoming conditioned to the gains

In our society we become conditioned to all circumstances; trading is no different. A trader on a good winning streak can easily add 1% or more to their trading account each day by using leverage and averaging down. The situation can even be positive to your energy system as you believe that price will at some point return to your break-even level.

It is at this point that you have lost almost any control over your trading mind; you are no longer doing your trading, and your inner demons now possess your thoughts and decision-making.

When you make 10% - 15% etc. per month, it’s only a matter of time before you wish that you had scaled back the amount of trades and the leverage that you have been abusing.

Old-fashioned word in trading? Discipline

We are riddled with greed. We move from buying one house to buying an investment property and so on. We seek better returns and become conditioned to wanting more and more.

In trading this plays out, but the effect is much quicker and with less warning.

To be disciplined means to be shy with your trade choice and to keep integrity within your position size. By combining both quality trade choice and integrity with position size you will not be tempted to grow your account at an unreasonable rate.

It is much better to develop the skills and mindset that trading will demand from you rather than building your account at a rapid rate for several months before it all caves in on you. When that happens, your mental integrity and your account will both need rebuilding.

Slow and very steady will win the race.

Think of what you could achieve over five years rather than what you want at the moment. Over time trading will almost become boring as you carefully select your trades and up hold your trading integrity.

If you are winning and adding over 3% to your trading account week, you must regroup now.

Professional traders believe 1% or 2% gain for the week is massive, professional traders are around much longer than the average retail trader. How do you want to mirror your trading towards, the average (crashing) retail trader, or the professional trader?

Take this as a warning and protect yourself from greed and inner demons.

Trade well, Steve T.

Avoid Costly Mistakes - Read my E-book!

This EXCLUSIVE E-Book "Best 5 Ways to Avoid Blowing Up Your Trading Account" (value $59.99), is NOW FREE for you for visiting my website, BUT ONLY IF FIT BELOW CRITERIA:

VALUED @ $59.99, NOW FREE!

Stop Losing Money

Find Direction and the Right Path

Stop frustration and Self-Doubt

Build Solid and Strong Foundations

Do You Deserve to Lose Money?

Do people that eat large volumes of takeaway foods, ignore obvious health care and do no exercise deserve ill health? Compared to a person who is aware and takes action with their healthy lifestyle choices?

Do traders deserve to lose money if they treat their trading development the same as the person who ignores healthy life choices? You will get what you give.

Going the easy way? It's a trap!

There appears to be a consistent effort made by traders to find the easy way to trade, via signal services, social trading, advisory services, robots, etc.

If you do, you open yourselves up to being a victim of a scam. If it all sounds easy and the return profit is very appealing, you are the target and the next easy victim!


Most of us can get caught out

Even seasoned traders can get caught out. Between my mentor who is a fund manager, another wealthy investor and myself, we diversified into a Forex fund that was showing fair returns on a weekly basis. The supplied trades gave an average of 1% - 2% return each week with the occasional small losing week in between. After all it involved me with two very sophisticated investors, how could this go wrong?

I withdrew and deposited funds testing the environment, kept in regular contact with the face of the fund. For almost 1 year everything appeared normal and above board

Then, one dreadful morning an email in my inbox shows a negative balance on the invested account. After various phone calls and emails that day the situation was very clear. This was a ponzy scheme!

It took over 10 years to get a portion of the funds returned via the courts. There were people who had life savings and retirement funds invested, dreams shattered. 

Did we deserve to lose our money (many thousands of personal dollars)? Yes.

We all want more and think we are smart and sometimes we are, however it can also catch you out. Did we all need more money from this situation? Not really but the desire and greed made us hand over some of our money to a total stranger when in fact we were all capable of earning for our self. We call it diversifying, but it is just greed.

Avoid the trap and learn how to trade!

Looking for the cheapest broker or high returning signal service is not where the goose has laid the golden egg. You need to invest into your trading development and yourself. If you do not do so, you will fail, there is no other way. You will deserve to lose money.

Your planning needs to be mapped out just like any other goal you set yourself. If you see yourself as a part-time trader trying to earn a few extra dollars, than that is fine but make sure your learning development is as detailed and focused as a trader that wants to depart from their current occupation and become a full-time trader. The market will not make any allowance for you. Create a detailed focused plan or fail.

Requirements

Firstly, you must have a passion for trading. This is because it will eat up much of your time until you can trade on a consistent level.

A desire to be open and work on your own personal development. 

You will spend much of your trading time alone. Can you be alone? Can you avoid the trap of seeking out other traders online to fill the loneliness void?

You need to work hard at trading. Trading takes many hours and dedication to learn. You will need to learn how to understand the market, price action, and yourself. We cannot complete this at a weekend introduction FX workshop. It will take time and dedication.

If you are in a position, find yourself a mentor. Finding random information on the web is not the answer. You are trading against the best traders in the world, do you really think you can take money off them by taking advice from some hack on the web? 

Most Traders Quit

To quit is easy. Blaming circumstances and situations make us feel better and justified. Whichever way you present this, we call it quitting

We all get to enjoy the fruits of those that have failed the most, but they refuse to quit. It is the very secret ingredient that gives us the privilege to drive a car, be a passenger in a plane, use electricity, have wireless internet, better health facilities, etc. 

Never quit but learn. See every setback as an opportunity to move forward.

Build a team of reliable, trustworthy people that you can use as your development. Be vigilant with whom you let into your life.

Do new traders deserve to lose money?

Until you have found your groove and position in the market, it will be difficult to avoid losing money. You only need to find a section of the market you feel that you can perform your best. If you hope to be a short-term trader, do that. If you only have the stomach for long-term trades, do that. Do what works for you. Feel open enough to develop your own personal trading approach. 

Trade well, Steve.

Course on computer screen

Do You Have What It Takes?

The quick answer is, "YES you do", but finding that trader within you is the challenge. In today's article, we will break down some challenges most traders have and offer some solutions.

You will need to quickly realize that you hold the key to success when it involves trading. The success is not with the strategy or following other traders. The very fact that we are all unique as individuals must give you a hint that you already own the key to successful trading.

I think it has become more difficult to be a successful trader. This is not because there is a lack of information and options available because there is ample available and this is now a part of the problem. Before new traders even begin their real development as a trader they are being exposed to solutions and courses that are "marketing business" geared up to sell things.

 It is difficult to recognize the real deal from the no deal.

Fx Trading Ebook

A good read and FREE Download

It takes time to develop

For most traders, it will take almost two years to get to the real starting line. This is where your official development begins. It is after you have had your fingers burnt from various online environments and your own sabotage.

In my very early days as a trader, I recall a conversation at the time with another newbie and he mentioned that he wanted to craft his trading skills over the next five years. At the time I thought it was a ridiculous statement to make but knowing what I know now, that was a very smart and thought out commitment. The trader had a development plan in place.

What are the trading traps?

They are all around you. Each step and trade creates a new environment to fail. Everything from money management, trade selection, and trade management can consume your thinking.

The trading world brings with it the opportunity to make money or lose money. The only way we keep score is by observing the funds in our trading account. We see this as a reflection of our own image when in fact it is a process.

We then need to identify and deal with our own psychological battles. These scars carry the most burden and are the most difficult to repair for our trading world.

Most times, the courage to deal with our trading psychology is the final frontier within the trading cycle. It should be the first issue that we deal with however that is not possible as we need to take on the battle first before we can correct them, it can only be this way.

A few ideas that might help you

First, you need to understand that the art of trading is always evolving; there is no end in your trading development. It will take several years before you have built a strong enough psychology to deal with the markets in a consistent regular basis.

Ground yourself in quality information and traders that have had many years of trading. These are the traders that have been through the school of hard knocks.

Invest into your trading. Those that think they will learn how to be a successful trader without investing some real dollars into their development need to think a little deeper about the situation.

Think and grow rich

Napoleon Hill wrote "Think and grow rich" and was published in 1937. This book took twenty years of research and is now the cornerstone book for many successful people in the world. This is not a book you read once and put back on the shelf. This is a book that you continually study and apply the concepts to your life as you develop. As you evolve, the book evolves.

If you are serious about your development as a trader, take up this book and apply it to your trading and life. I promise you it will make a huge difference to your outcomes and your thinking.

It is all on you

Nothing in life is free; there is always a price to pay. Some are prepared to do whatever it takes and meanwhile others look for excuses to bail out and quit. This is all on you and not the circumstances.

In a world of blame, it is easy to give up but guess what? Trading is not easy and for many it will be one of the most difficult undertakings you will ever endure. This is not because it is difficult to put a trade on or to have a broad understanding of the market... Over a short period of time these are rather easy to concepts to grasp. Trading is difficult because our ego and survival instincts are pointing in the opposite direction. To overcome this, it takes a massive amount of work and personal development. As we continue with our development, we then test it in the market. 

Enjoy your development and have a look at my course on price action trading.

Steve Teunis.

Online Ebook Mastering Fx Trading

Your Success Model for Trading

Let's get real

Many new traders enter the world of trading with the lure of easy money. All you need is an internet connection and a platform to place a trade. This allows you to play ball with the big boys.

You are scammers bait!

A new trader is easily attracted to the results that Facebook group participants set as bait. The bait is to get you to part with your money. If you cannot identify the scammers from the genuine play makers, chances are that you will never make it in the trading environment.

If you want to know more about the home truths, have a look at my E book. I wrote it to send the readers a very clear message. That message is, "This is all on you". No room to blame or ask those around you to take on your responsibility. What is your responsibility? 

Fx Trading Ebook

FREE Ebook!

Your Responsibility

Relying on signals to buy and sell, taking the trading advice from others and asking silly questions like, "Should I buy or sell today" means you are not ready to trade live.

Your responsibility is to develop and structure your learning path. Trading the markets with success is a massive undertaking, and therefore people are looking for quick, easy solutions. This is the world we live in, it is the here and now. 

As per any worthwhile endeavour, there will be those waiting with open arms to cash in on the opportunity. They will show you the easy way. Yet with trading there is no "easy way", it takes time for ​your own personal trading model to fully develop

Your Personal Trading Model

What is your personal trading model? This will take time for you to discover. The part that traders do not want to hear is that after two years of dabbling and trying different trading approaches, you will be ready to start your personal trading model. After a few years of experimenting and following certain online gurus, you have come full circle. There are many positives to pull out of the various experiences that you have obtained. If you have been able to survive a few years without giving up, you are more than likely able to turn your focus to success.

Your personal trading model will always evolve as you engage with new trading experiences. See trading as a personal development platform rather than a moneymaking venture. From growth comes reason and from reason comes responsibility.

Three Pillars For Trading Success

Understand the market - Your development as a trader must involve you learning the functions of the market. This does not have to be at a level of an economist, keep in mind we are traders and economists are not. You need to understand what is driving the markets. To do this you need to read quality articles and opinions. Most importantly you should not take the information as gospel but simply park it in the back of your mind, no different compared to tomorrow's weather report. it is simply information that you are aware of. To help you with this, we post a daily Insights newsletter as well as daily videos to help to develop traders to understand the market

Take the time to observe the market reactions to certain news events. You are trying to create a feel for the market and this comes by spending time with the market. I explain this in much greater depth within our "Mastering EURUSD course".

Understand Price - Price is the most up-to-date indicator you will find. Price is a leading indicator and not lagging as per every other indicator on your charting software. Over time you will build a relationship with price and your chosen currency pairs. Try not to spread your energies far and wide. Focus on just a few pairs and over time you will spread your new skill sets out to other pairs.

The study of price will give you a huge advantage to become a successful trader. Most traders never look back after they have developed an understanding of price; it makes no sense to change to lagging indicators.

Once more, it will take time to understand the workings of price. Once you have combined your understanding of the market and price, you will have a feeling of completion.

Price is king.

Understand Yourself  -  Without the completion of understanding yourself, all the other work you have applied will become wasted. Understanding yourself allows you to work on your inner personalities. The hierarchy that does your trading for you. This will expose many of your inner demons that play out whilst trading. The need for attention, winning, to be right, greed, fear of missing out, importance and many more personalities that do your trading for you.

Trading will expose these trading issues. These are personalities that serve you well in the real world; however they are your very downfall when trading.

From where I sit, it is relatively easy to pick up on the various hierarchy issues that stand in the way of trading. If a student shows me just a few trades (win or lose), it is easy to identify the core of the situation. We can then start to make changes to your advantage.

Course on computer screen

Learn better trading practices!

Discipline and Self Development

Every form of freedom in your life is purchased with the price of discipline. If you want freedom, you need discipline. If you want to be a successful trader, you need to apply consistent discipline. Discipline can be painful; however it is rewarding.

A trader will need to apply discipline and have excellent trade selection. If you jump in and out of every opportunity, you will end up in trades that you have no business being in. It is much better to display discipline with your trade selection and avoid the pain of jumping into undesired trades. 

As a trader,  you will have the minimum requirements to be successful. Do not waste the opportunity. Work hard.

That is not all

We have given you the three principles to a successful trading model. Each of these will get broken down into deeper components. 

Your equity management protocol needs to be outlined. You will need discipline to apply this. Your development needs to undertake psychological challenges. These issues that you will discover within your trading will need to be addressed and managed. keep in mind we are emotional beings and we are not trying to change that; however, we want to find tools to manage the emotions.

Serious about trading?

If you are serious about your development as a trader, we invite you to have a look at the FREE resources we offer at our website.

The knowledge center on the website will give you access to quality information. The daily insights will break down price action and the drivers of the market for the upcoming trading session.

Happy Trading, Steve.

Online Ebook Mastering Fx Trading

ECB – Why Negative Interest rates?

We know that the currency market and in fact all markets are driven by future interest rates. Interest rates are a tool to manage the growth of the economy. Each piece of micro data adds to the interest rate story.

In recent years the global growth has been difficult to stimulate. The mandate for most central banks is to manage inflation and to have a stable financial system. The cash rate set by the central bank is the rate at which retail banks lend money to each other. The banks will have their profit mark up passed onto the end customer.

Understanding the Market

As volatility retail traders, we do not have to understand the inner workings of a central bank. However to understand the market we do need to have a broad brush understanding of the drivers. We need to know if the FED is hinting to raise rates again or reduce rates. When a central bank makes a shift in policy, you need to know. Understanding the market takes time and discipline. If you are reading this article then it is a way for you to improve your understanding of the market. 

Keep in mind, our role is not to predict what the central bank will or will not do. Yes, an opinion is fine but do not be married to the opinion. We are also not predicting how the market will respond.

Why Negative Interest rates?

The purpose of negative interest rates is to increase inflation and growth. To increase inflation, spending is needed. People can borrow at much lower rates which encourages spending. This is known as cheap money.

If a large company can borrow at a very low rate, invest into infrastructure, expansion, create jobs etc, then this will create growth thus inflation. Naturally the biggest fear for the central bank is deflation. The central bank will do almost anything to avoid deflation of it's economy.

Negative interest rates are a sign of pure desperation from central banks. it is like the last party trick when nothing else works.

The Negative to Negative Interest Rates

Banks need to hold deposits from you and me. Banks have minimum deposit requirements which determines their ability to lend. Retail banks lend out more than what they have, this is the power of fractional banking.

This creates an interesting situation for banks. They need to attract deposits in order to lend, however negative rates means the depositor need to pay the bank to hold their money.

The entire concept of negative rates or low rates in to encourage people to spend to create growth and spur on inflation.

One Crucial Consideration

For those that are in a financial position or are in a spending cycle within their life, what must you have? You need to have confidence. You need to feel some wealth factor, certainty about your job. Confidence in your economy will encourage you to buy a new car, upgrade your property, buy an investment property, expand your business etc.

Self funded baby boomers will not want to extend their financial commitments due to the low interest rate returns offered to them from the banks due to negative interest rates. They have however been lucky enough to have in recent years a good stock market with good dividends. They do not have confidence to be easy with their wealth.

Euro zone - TLTRO III

In a matter of hours we are about to have TLTRO III announced by the ECB. The most recent TLTRO was in 2016 during the Euro debt crisis. Back then the ECB deposit rate was -0.4%. The Euro zone has moved on since then and the situation for the region has improved. There has been some growth however their are still many headwinds ahead for the Euro zone. Trade wars are at play, Brexit is still dragging out and global growth is terrible.

When you see the term TLTRO III, just think the word "stimulus". 

How can I use this in my Trading?

As a trader, we need to be listening for shifts from the central banks. Let us assume that in 12 months from the installation of TLTRO III, we started to see some consistent growth come out of Europe. The central bank might start communicating a positive picture for the Euro zone. This would start to translate to less stimulus and at some point an increase in interest rates and less bond buying from the ECB.

The situation explained above would be positive for EUR. We would also need to know what the FED was thinking.

Currently the EURUSD is trading near 1.1200. This is on the back of a FED that has been hiking rates and a ECB that has been stimulating the market. Less than 12 months prior the EURUSD was trading at 1.1800. This was on the back of ECB signaling rate increases at some point in the near distant future. This never happened.

The micro data such as PMI's, employment, retail sales, CPI etc are drip feeding into price. Listed to what the central banks are saying. All this combined will lead to interest rate changes and this is what the market cares about.

Clarity for EURUSD Pair

As I mention in the Mastering EURUSD Course https://eurusd-fxtrader.com/price-action-trading-course/ the EURUSD pair gives us two central banks with clear communication. Central banks do not want to shock the markets and will drip feed the market information relating to interest rates. Most often by the time an interest rate adjustment has been made, the change has already been priced in. This is why the press conference or meeting minutes are crucial as this is where the next direction on interest rates are coming from. 

USD is the backbone

The United states has a very big advantage. The advantage is that it owns the reserve currency of the world. More than 80% of all trade transactions are completed with USD. This makes the USD king. There will be a shift at some point in time, there always has been but for now it is the USD. If you own the worlds reserve currency, you have a very big advantage.

As traders we need to track the USD strength and weakness. This will determine flows in and out of currency pairs. By understanding the interest rate situation for your specific trading pair, you will also have an advantage. 

The more you can understand the market, the more success you will have. Do keep this in mind, the market does not always respond to the fundamental logic's, so be careful not to cast your opinion onto the market via a trading position.

Good Trading

Steve Teunis


Key Levels, Why They Matter

The purpose of key levels

Key levels are Support and Resistance levels where price could offer us a trade response.  These are levels where there is a line in the sand, where price should often pause. I explain key levels in depth within the Mastering course. https://eurusd-fxtrader.com/course/

The future key levels are best observed on larger time frames. The 240 & 60-minute charts will give you a broad view of these key levels. You can either take a note of these key levels or document the levels on your chart. Once you have identified the future key levels there is no need to continually eyeball the levels on the larger time frame go down to a smaller time frame.

EURUSD 240 Minute chart

Below is the EURUSD 240 minute chart. The important key levels ​are documented and identified. Note, we are not looking to predict the direction of price or cast our opinions onto the market. We are looking to identify key levels where price might respond so we can execute a manageable trade.

Within this chart, you can identify where price has consistently traded within each key level parameter. Keep in mind, this is a 240-minute chart and not used for trade entry. It is also not going to be an exact science and slippage through the key levels needs to be considered.

Trading chart

EURUSD 4 hour chart with Support and Resistance Levels

Breaking down key levels

For intraday trading, use the 60 & 15-minute charts to help you fine-tune your trade selection. If price has been trading in a tight daily range, you will find the 15-minute chart useful. If price has been stretching the daily range, you will find the 60-minute chart more helpful. Either way, both 15 & 60-minute charts should be considered as tools for intraday trades. We are looking for price structure. Price structure will be how price merged into the key levels and the structure in and around the key level.

Smaller time frames

Keep in mind, we have identified future key levels from the larger time frames. We have then broken this down into the intraday charts of 15 & 60-minute time frames.

Assuming we have been able to identify a high odds and low-risk level, we now break this down into a much smaller time frame. The time frame might be a 2 or 5-minute chart. At this point, you should know in your mind the exact level you want to execute the trade entry. Wait with patients. Your level may or may not get hit.

There is more to it

Never ever just take a trade based on the identity of a key level. There is much more to be considered. All of those many considerations we discuss in the course as well during the daily insights newsletter. Some of those considerations will be, time of day, Average true range, news, fundamentals, currency pair characteristics, price delivery.

The main purpose of this article is to help you understand how you can identify key levels. Trade selection, trade execution, and trade management are all a different beast.

Be mindful, just because you have identified a key level, this is not a license to take a trade. Important to also consider why you should not take a trade.

Happy Trading, Steve.

GET STARTED TODAY WITH A SPECIAL DISCOUNT!

LIMITED TIME ONLY!

For 48 hours only, you can get this course for only $199 instead of the normal price of $599!

Get started TODAY and don't miss out on this CHANCE!

00
Days
00
Hours
00
Minutes
00
Seconds

AND.... GET THESE THREE BONUSES INCLUDED!

EXCLUSIVE BONUS ONE  

3 HOUR VIDEO & HANDBOOK COURSE, FREE FOREVER!  

For a limited time only, ALL new Sign Ups will get our 3 hour Video Training Course 

"The 3 Most Reliable Trade Setups" completely for FREE!

This valuable video ($259), includes:

  • Exclusive and High Value Trade Setups!
  • 3 Hours of Video Content
  •  5 Training Modules
  • 14 Videos
  • Hand Book & 50 Slides

EXCLUSIVE  BONUS TWO   

ONE MONTH ACESS TO MASTERMIND INNER CIRCLE  FREE!

For a whole month you will be allowed to walk among the best traders, and get access to all the resources they have at their disposal. Of course, if you want to stay afterwards, your are more than welcome!

Excl​​​​​usive Weekly Webinar 'Wednesday Ask Me Anything

Every Wednesday, 1 hour Q&A Webinar, 2pm ACT-Canberra

Daily Session Previews with Trade Levels

Access to closed Mastermind Facebook Trading Group

Live Updates during Trading Sessions

Access to Live Updates in closed Mastermind Facebook Group

Weekly strategy video

Outlook on the coming trading week with insider tips

Fundamentals newsletter

Insight in long-term market trends and indicators on a bullish or bearish outlook

EXCLUSIVE BONUS THREE  

100% MONEY BACK GUARANTEE 

If this course somehow does not live up to your expectations, we will give you a FULL REFUND within 14 days of purchase!

Sticky Currency Pairs explained

More than likely you have never heard of this terminology "sticky"

Understanding the individual characteristics of each currency pair will be crucial for your trading success. Taking trades on technical levels but not understanding the currency pairs personality is a big mistake. Much like people, currency pair characteristics do not change, we will discuss and show you what are sticky pairs. 

EURUSD & GBPUSD

Both the EURUSD and GBPUSD pairs respond well off key levels if the overall drivers of price are one directional. Let us assume that the market was very bullish the US dollar. We will still see these two pairs respond of key levels. Perhaps the response is not as deep compared to when the market is trading in a balanced state however you can normally trust a response when your trade selection is selective off a key level.

Naturally this will not always be the case, especially if the market is making major adjustments such as a flight to safety or risk because of political situations or central bank talk. By understanding the market as we often discuss, you will identify these events.

Our preferred trading environment is when price is range bound and staying within or near its average true range.

Sticky AUD and NZD

When these two pairs trend they trend well. I consider both pairs risk currency pairs because of their higher interest rate status. They are both reliant on China and can be sensitive when the market is in a risk-off phase. For many years both pairs had a positive carry against the US$ however over recent years this has not been the case. The positive carry allows inflows to the currency and stock market thus keeping both these pairs well bid. Both pairs still have a positive carry against the JPY and this would be unlikely to change.

Unlike the EUR and GBP, both AUD and NZD have a much smaller daily range. AUDUSD can still be traded for intraday trades, but the NZDUSD is more suited to swing trades rather than day trades.

Let's get sticky

Sticky is best explained by saying that when price is trading in a direction either up or down, the response off key levels is often muted. This is never going to always be the case as the market continually trades in phases. A phase might be between two or three big figures or a very tight range. Another phase might be when price does not respond of a key level with any conviction thus sticky. Our job is to pick up on these characteristics as they happen.

Chart example

Below is a NZDUSD 60-minute chart. I circle the important possible reaction points in blue. From the base at 0.6480 we can see how price responded and into each of these blue circled levels. Each response or in this case was very limited. In most cases at best there was simply a pause but nothing noteworthy of a manageable trade reaction.

Described is a very common characteristic seen on both AUD and NZD. You need to be careful when looking for a response from these pairs. Try to trade each of these at their extreme level for each day, when the Average True Range has been stretched and allow some wiggle room within your trade management and equity management. They can be very stubborn once we find a direction. 

We cannot explain and give you the entire structure of this sticky event situation, but hopefully this will give you some awareness to the behavior.  Much of the trading approach we teach you is about price action; however deeper component of price action is price characteristics as we are discussing within the article.

Happy Trading, Steve.

Course on computer screen

The Three Pillars for Success

  • Understand the market
  • Price Action, and 
  • YOURSELF

Understand the market

You need to look wider than just the currency market. Scrolling through your charts on various time frames is important. You should also look at the equity markets, oil, gold, 10 year treasury yields and the Dollar Index. You need to form a view of the entire market much like you do with your currency pairs. Sniff out the big picture.

Price Action

After you have completed your many hours of screen time using the study of price, you will have the characteristics of your chosen currency pairs edged into your brain. The benefit will give you an understanding of price behavior. 

When price is trading within its trading range and responding off key levels, our connection with the market falls into place quickly. When price trades outside of these parameters we can become quickly challenged. The change in the market environment can change discreetly. It does not give us any great warnings but will need to think on the moment and respond.

Use the various other market instruments to help you find the warning. Below serves as an example of that.

Below is a daily image of the S&P 500. We know the market is nervous at the moment with China-US trade tensions. There is a level of uncertainty, more than normal.

On the daily chart we see that 2800 is a very strong key level and below this level we have a 2735 area. If price trades heavy towards 2800 and slips through, we can assume that 2740 will be the next key level for the market. With this we are likely to see volatility in the FX market pick up. This means that we need to reconsider our key levels, trade selection, stop and profit levels.

                                                                                  S&P 500 Daily Chart - Image May, 24, 2019

YOURSELF

In other blog posts I have already extensively discussed why YOU are the biggest stumble block on your way to success. I suggest you read these articles to get a better idea.

Ignore this at your Own Risk!

Why Big Gains will Cost You!

I have a whole chapter dedicated in my Ebook, it's a FREE download, so I suggest you read it!

IMPROVE YOURSELF

You can only move forward if you are willing to change and learn from industry leaders. I have been trading for many years and very grateful to find myself in a position where I can pay it forward with a very clear and cheap trading course on Price Action. It's one of the best course you'll find out there.

Happy Trading, Steve.

GET STARTED TODAY WITH A SPECIAL DISCOUNT!

LIMITED TIME ONLY!

For 48 hours only, you can get this course for only $199 instead of the normal price of $599!

Get started TODAY and don't miss out on this CHANCE!

00
Days
00
Hours
00
Minutes
00
Seconds

AND.... GET THESE THREE BONUSES INCLUDED!

EXCLUSIVE BONUS ONE  

3 HOUR VIDEO & HANDBOOK COURSE, FREE FOREVER!  

For a limited time only, ALL new Sign Ups will get our 3 hour Video Training Course 

"The 3 Most Reliable Trade Setups" completely for FREE!

This valuable video ($259), includes:

  • Exclusive and High Value Trade Setups!
  • 3 Hours of Video Content
  •  5 Training Modules
  • 14 Videos
  • Hand Book & 50 Slides

EXCLUSIVE  BONUS TWO   

ONE MONTH ACESS TO MASTERMIND INNER CIRCLE  FREE!

For a whole month you will be allowed to walk among the best traders, and get access to all the resources they have at their disposal. Of course, if you want to stay afterwards, your are more than welcome!

Excl​​​​​usive Weekly Webinar 'Wednesday Ask Me Anything

Every Wednesday, 1 hour Q&A Webinar, 2pm ACT-Canberra

Daily Session Previews with Trade Levels

Access to closed Mastermind Facebook Trading Group

Live Updates during Trading Sessions

Access to Live Updates in closed Mastermind Facebook Group

Weekly strategy video

Outlook on the coming trading week with insider tips

Fundamentals newsletter

Insight in long-term market trends and indicators on a bullish or bearish outlook

EXCLUSIVE BONUS THREE  

100% MONEY BACK GUARANTEE 

If this course somehow does not live up to your expectations, we will give you a FULL REFUND within 14 days of purchase!