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Todays Berita Pasar Saham Analisa amp Real-Time After Hours Berita Pra-Market Flash Kutipan Kutipan Bagan Interaktif Setelan Bawaan Harap diperhatikan bahwa begitu Anda membuat pilihan Anda, ini akan berlaku untuk semua kunjungan masa depan ke NASDAQ. Jika, sewaktu-waktu, Anda tertarik untuk kembali ke setelan default kami, pilih Setelan Default di atas. Jika Anda memiliki pertanyaan atau mengalami masalah dalam mengubah pengaturan default Anda, silahkan email isfeedbacknasdaq. Harap konfirmasikan pilihan Anda: Anda telah memilih untuk mengubah pengaturan default untuk Pencarian Kutipan. Ini sekarang akan menjadi halaman target default Anda kecuali Anda mengubah konfigurasi Anda lagi, atau Anda menghapus cookies Anda. Yakin ingin mengubah setelan Anda Kami mohon untuk meminta Harap nonaktifkan pemblokir iklan Anda (atau perbarui setelan Anda untuk memastikan javascript dan cookie diaktifkan), sehingga kami dapat terus memberi Anda berita pasar tingkat pertama Dan data yang Anda harapkan dari kami. Pasokan Emas Fisik Besar Permintaan Permintaan Ilustrasi Dikirim oleh Koos Jansen dari data permintaan dan permintaan Bullionstar Gold yang diterbitkan oleh semua perusahaan konsultan primer tidak lengkap dan menyesatkan. Data tersebut secara keliru menyajikan emas untuk menjadi komoditas yang lebih banyak daripada mata uang, karena telah menyebabkan kesalahpahaman yang mendalam sehubungan dengan karakteristik perdagangan logam besi dan formasi harga. Sejumlah perusahaan konsultan di seluruh dunia, misalnya Thomson Reuters GFMS, Focus Logam, World Gold Council dan CPM Group, menyediakan statistik permintaan dan persediaan emas fisik, disertai dengan analisis statistik ini terkait dengan harga emas. Sebagai bagian dari analisis mereka, perusahaan menyajikan keseimbangan permintaan dan penawaran yang menunjukkan berapa banyak emas yang dijual dan dibeli secara global, terbagi dalam beberapa kategori. Ini diasumsikan secara luas bahwa saldo ini mencakup keseluruhan penawaran dan permintaan fisik, yang salah karena kategori yang paling penting dikecualikan. Perusahaan-perusahaan meskipun, memilih untuk tidak berbagi kebenaran halus atau model bisnis mereka akan rusak parah. Keseimbangan penawaran dan permintaan oleh perusahaan menggambarkan emas menjadi komoditas yang lebih banyak daripada mata uang, karena inti neraca mencerminkan berapa banyak logam diproduksi versus dikonsumsi - diletakkan secara berbeda, perusahaan terutama berfokus pada berapa banyak emas yang ditambang versus bagaimana Banyak yang dijual di produk yang baru dibuat. Namun, kenyataannya emas itu kekal dan tidak bisa dikonsumsi (habis pakai), semua yang pernah ditambang masih di atas tanah yang diawetkan dengan hati-hati dalam bentuk batangan, koin, perhiasan, artefak dan produk industri. Sebagian karena properti ini, pasar bebas telah memilih emas untuk menjadi uang ribuan tahun yang lalu, dan karena uang mayoritas perdagangan emas dilakukan di atas cadangan tanah. Tidak dapat disangkal, total pasokan dan permintaan emas jauh melebihi produksi tambang dan permintaan eceran. Karena kebanyakan investor individual, manajer investasi, jurnalis, akademisi dan analis logam mulia menganggap keseimbangan oleh perusahaan akan selesai, kesalahpahaman global mengenai penawaran dan permintaan emas adalah salah satu proporsi epik. Emas fisik adalah jangkar yang mendalam dalam sistem keuangan global kita dan dengan demikian sangat penting kita memahami detail halus karakteristik perdagangannya. Supply amp Permintaan Metrik oleh Perusahaan Perusahaan dapat berpendapat bahwa perbedaan antara apa yang mereka hadirkan sebagai penawaran dan permintaan (SampD), yang bertentangan dengan apa yang saya anggap sebagai pendekatan Sampd yang lebih murni adalah karena metrik yang kontras. Dengan demikian, wersquoll mendiskusikan metrik mereka untuk mengungkapkan kelemahan mereka. Singkatnya, perusahaan hanya menghitung aliran Sampah emas fisik yang mudah diukur, sementara meninggalkan bagian yang paling penting: penawaran dan permintaan institusional. Meskipun semua perusahaan memiliki metodologi yang sedikit berbeda untuk mengukur Sampd, dari perbandingan angka tampaknya sangat mirip. Untuk penyelidikan lebih lanjut, kami menyoroti metrik dan model oleh GFMS. Alasannya, GFMS adalah satu-satunya perusahaan yang bersedia berbagi deskripsi lengkap tentang metodologi mereka untuk publikasi ndash agar dapat dilihat di sini. Focus Logam (MF) memberikan metodologi parsial, World Gold Council dan CPM Group menolak memberikan komentar. Letrsquos telah melihat kategori Sampah GFMS-nya. Di sisi penawaran disertakan: Pasokan tambang (emas yang baru ditambang) Pasokan memo (emas bersumber dari produk palsu bekas) Di sisi permintaan meliputi: Permintaan perhiasan (kandungan emas yang digunakan pada produk perhiasan yang baru dibeli yang dibeli secara lokal pada tingkat eceran, disesuaikan dengan Perhiasan diekspor dan diimpor). Permintaan industri (volume emas yang digunakan dalam aplikasi industri, misalnya kawat pengikat, produk yang digunakan dalam semikonduktor dan paduan gigi). Investasi bar ritel (volume bersih batang yang dibeli oleh investor perorangan melalui saluran ritel). Investasi koin (kombinasi data yang dipublikasikan dari permen dan juga survei eksklusif yang dilakukan oleh GFMS yang merinci di mana koin terjual). Empat kategori permintaan di atas yang disimpulkan sering disebut sebagai permintaan ldquoconsumer oleh perusahaan. Selanjutnya, GFMS meliputi: Lindung nilai bersih (perubahan dampak pasar fisik perusahaan pertambangan terhadap posisi pinjaman emas, ke depan, dan pilihan) Sektor resmi bersih (total penjualan atau pembelian bank sentral) Persediaan inventarisasi ETF (perubahan persediaan ETF) Persediaan pertukaran inventaris (perubahan dalam Persediaan pertukaran) Empat kategori terakhir dapat berupa penawaran atau permintaan. Misalnya, ketika bank sentral (sektor resmi) secara total adalah penjual bersih, ini akan tercatat sebagai angka permintaan negatif, seperti yang ditunjukkan pada neraca Sampo oleh GFMS di bawah dari tahun 2006 sampai 2009, ketika bank sentral secara total adalah pembeli bersih Akan tercatat sebagai angka permintaan positif, seperti yang ditunjukkan pada saldo dari 2010 sampai 2015. Untuk gambaran yang jelas tentang saldo Sampah Sampah GFMS, silakan lihat semua item baris di bawah ini. Bukti 1. GFS Courtesy. Saldo Sampah emas global seperti yang diungkapkan dalam Gold Survey 2016. Menurut GFMS Supply terdiri dari produksi Tambang. Scrap dan Net Hedging. Pada gilirannya, Permintaan terdiri dari Perhiasan, Fabrikasi Industri, Investasi Ritel. Dan Sektor Resmi Bersih. Setelah menyeimbangkan Supply and Demand ini menghasilkan Surplus FisikDefisit. Kemudian, Inventory Inventory Build and Exchange Inventory Build ditambahkan dari hasil Surplus FisikDefisit ke Neraca Bersih. GFMS suka berpura-pura keseimbangan mereka selesai dan kadang-kadang mengartikulasikan surplus atau defisit yang timbul darinya berkorelasi positif dengan harga emas, yang sebenarnya tidak benar, karena saya akan menunjukkan langkah demi langkah. Perusahaan Mengecualikan Permintaan Emas Mayoritas Permintaan Kebanyakan hal penting yang dikecualikan dari keseimbangan adalah apa yang oleh wersquoll disebut sebagai penawaran dan permintaan institusional, yang dapat didefinisikan sebagai perdagangan bullion antara individu dan institusi dengan kekayaan bersih tinggi. Biasanya bullion yang dimaksud masuk dalam 400-ons (12,5 Kg) London Good Delivery (GD) bar yang memiliki kehalusan tidak kurang dari 995, atau lebih kecil 1 Kg bars yang memiliki kehalusan tidak kurang dari 9999. Selain itu, batangan bullion dapat Berat 100 ons atau 3 Kg, di antara ukuran yang kurang populer lainnya, umumnya memiliki kehalusan yang tidak kurang dari 995. Bullion dapat diperdagangkan tanpa berubah dalam berat atau kehalusan, namun dapat disempurnakan danulang untuk transaksi juga, misalnya dari Bar GD menjadi bar 1 Kg. Dalam beberapa kasus, penawaran dan permintaan institusional melibatkan perdagangan lintas batas, ketika bullion dijual di negara A kepada pembeli di negara B, dalam kasus lain, bullion mengubah kepemilikan tanpa memindahkan seluruh wilayah perbatasan. Disediakan dua contoh contoh institusional SampD: Investor (investor) memesan 400 Kg emas ke rekening yang dialokasikan di bank bullion di Swiss - yang akan dibeli di pasar grosir Swiss yang paling mungkin terjadi di bar GD. Sampah jenis ini tidak akan dicatat oleh GFMS. Seorang investor China (institusional) membeli 100 Kg emas langsung di Shanghai Gold Exchange (SGE), pasar grosir China, dengan harga 1 Kg 9999 dan menarik logam dari kubah. Transaksi ini tidak akan didaftarkan oleh GFMS ndash atau firma lainnya. Contoh-contoh ini menunjukkan bahwa saldo Sampdip oleh GFMS tidak lengkap. Untuk tujuan ilustrasi, di bawah ini adalah bagan berdasarkan semua nomor Sampd oleh GFMS dari tahun 2013, dilengkapi dengan perkiraan konservatif institusional SampD saya. Termasuk total transaksi institusional SampD tahun 2013 pasti sudah mencapai lebih dari 6.600 ton. Exhibit 2. Global gold SampD 2013 oleh GFMS, termasuk konservatif estimasi kelembagaan SampD. GFMS Meliputi Jejak Dengan Bantuan Dari LBMA Meskipun GFMS sesekali mengakui jumlah mereka tidak lengkap (mereka harus), pada saat bersamaan mereka telah berjuang selama bertahun-tahun untuk gerhana Sampgas institusional yang nyata bagi pendengarnya. Taktik tanpa henti diperlukan ketika pada tahun 2013 permintaan institusional di China mencapai sekitar 1.000 ton dan lebih dari 500 ton di Hong Kong. Permintaan institusional di Timur didominasi oleh bar GD dari London Bullion Market, yang disempurnakan menjadi 1 Kg 9999 bar yang lebih populer di Asia. Untuk menutupi GFMS berusaha keras untuk menyanggah volume emas yang ditarik dari kubah SGE, dan karenanya London Station Market Association (LBMA) menyesuaikan statistik total emas murni dengan kilang anggotanya. Hebatnya, LBMA bekerja sama. Izinkan saya untuk membagikan analisis saya secara rinci. Pada tahun 2013, sesuatu yang tidak biasa terjadi di pasar emas global karena tuntutan institusional China meledak untuk pertama kalinya dalam sejarah. Ratusan ton pasokan institusional dari London dalam bentuk bar GD terutama dikirim ke Swiss untuk disempurnakan dalam 1 Kg 9999 bar, kemudian diekspor melalui Hong Kong untuk memenuhi permintaan institusional di China. Dari data pabean oleh Inggris, Swiss dan Hong Kong, jejak Sampel institusional terlihat jelas. Dari tahun 2013 sampai 2015 bahkan ada korelasi kuat antara ekspor emas bersih UKrsquos dan penarikan SGE. Menunjukkan pada grafik di bawah ini. Bukti 3. Korelasi antara ekspor emas bersih Inggris dan penarikan SGE. Karena mekanika pasar emas di China. Permintaan institusional Cina kira-kira sama dengan perbedaan antara jumlah emas yang ditarik dari kubah yang ditunjuk SGE (pameran 4, bar merah) dan permintaan konsumen China (pameran 4, bar ungu). Dalam pameran 4 di bawah ini Anda dapat melihat perbedaan yang membawa GFMS dalam kebingungan, terutama sejak 2013. Untuk informasi lebih lanjut tentang cara kerja pasar emas China dan ukuran permintaan institusional China, silakan merujuk pada jabatan saya Permintaan Emas Spektakuler China yang Ditolak Sepenuhnya Dengan GFMS dan Mainstream Media. Exhibit 4. Permintaan grosir Cina (SGE withdrawals), versus permintaan konsumen GFMS versus penawaran yang jelas. Lucunya, sejak 2013 GFMS telah mencoba meyakinkan pembacanya melalui berbagai argumen mengapa penarikan SGE melintasi 2.000 ton selama tiga tahun berturut-turut, sementara permintaan konsumen China mencapai sekitar setengah dari jumlah ini. Namun, argumen tersebut telah gagal total untuk menjelaskan perbedaannya - mereka hanya merasionalisasi sebagian, baca posting ini untuk informasi lebih lanjut. Dan GFMS berbuat lebih banyak untuk gerhana Sampgas kelembagaan yang nyata. Mereka berkolusi dengan LBMA. Untuk menjadi jelas, saya tidak bisa mengukur Samps Sampgtur institusional secara global. Namun, izinkan saya membuat perkiraan permintaan institusional yang jelas untuk tahun 2013. Yang penting, pada tahun 2013 sebuah banjir emas melintasi dunia dari Barat ke Timur. Permintaan institusional China menyumbang 914 ton dan impor Hong Kong mengimpor 579 ton - wersquoll terakhir digunakan sebagai proxy untuk permintaan institusional Asia tambahan, karena Hong Kong adalah pusat perdagangan emas utama di kawasan ini. Secara total permintaan institusional pada tahun 2013 diperhitungkan (914 579) 1.493 ton. Jika kita menambahkan semua kategori permintaan lainnya oleh GFMS yang ditunjukkan pada pameran 1, total permintaan pada tahun 2013 setidaknya 6.619 ton. Sadarilah, ini tidak termasuk permintaan kelembagaan yang tidak jelas. Pameran 5. Permintaan emas global 2013 oleh GFMS, termasuk permintaan kelembagaan yang nyata. Karena hampir semua permintaan emas grosir di Hong Kong dan China untuk 1 Kg 9999 bar, industri penyulingan global bekerja lembur pada tahun 2013, terutama untuk memperbaiki pasokan institusional dan ETF di bar GD yang berasal dari London. Pada bulan Desember 2013 saya mewawancarai Alex Stanczyk dari Dana Emas Fisik yang sebelumnya telah berbicara dengan kepala kilang Swiss. Pada saat itu Stanczyk mengatakan kepada saya tanda kurung yang ditambahkan oleh saya: Mereka melakukan tiga shift, mereka akan bekerja 24 jam sehari dan awalnya dia kepala kilang mengira akan segera turun. Nah, mereka sudah melakukannya sepanjang tahun 2013. Setiap kali menurutnya itu akan melambat, dia mendapat lebih banyak pesanan, lebih banyak pesanan, lebih banyak pesanan. Mereka telah memperluas pabrik ke tempat yang hampir menggandakan kapasitas mereka. 70 kilobunan kilobar mereka pergi ke China, dengan kecepatan 10 ton seminggu. Thatrsquos dari satu kilang, sekarang ingat ada 4 kilang besar ini di Swiss. Sebagai konsekuensinya, statistik mengenai total produksi emas ldquo pada tahun 2013 oleh penyuling emas LBMA yang terakreditasi Ldro yang berada dalam Daftar Pengiriman Bagus rdquo, dimana empat kilang besar di Swiss berpisah, menangkap aliran Sampdab institusional yang luas - di samping Hasil tambang tahunan dan pemurnian memo. Pada tanggal 1 Mei 2015, LBMA mengungkapkan total produksi emas murni oleh anggotanya pada 6.601 ton untuk tahun 2013 dalam sebuah dokumen berjudul A guide to The London Bullion Market Association. Tidak ada kebetulan angka ini sangat mendekati perkiraan saya terhadap total permintaan (6.619 ton), karena permintaan institusional yang jelas di Asia semuanya disempurnakan dari GD menjadi 1 Kg bar. Herersquos memamerkan 2 dari sudut yang lain. Pameran 6. Sampah emas global oleh GFMS, termasuk Sampdang kelembagaan yang jelas, dibandingkan dengan total produksi emas murni 2013. Pada tabel di bawah ini, kita dapat melihat statistik penyempurnaan LBMA untuk tahun 2013 pada 6.601 ton. Bukti 7. Courtesy LBMA. Screenshot dari A guide to The London Bullion Market Association yang ditangkap oleh Ronan Manly pada bulan Mei 2015. Setelah publikasi ini GFMS terjebak, statistik penyulingan ini menunjukkan bagian signifikan dari aliran Sampling institusional yang telah mereka coba sembunyikan. Apa yang terjadi selanjutnya - saya berasumsi - apakah GFMS dengan ramah meminta LBMA untuk menyesuaikan statistik penyulingan mereka ke bawah. Pertama dan dengan susah payah terpapar oleh rekan saya Ronan Manly dalam beberapa posting mendalam, LBMA berlutut dan mengubah statistik penyulingan untuk mempertahankan permainan di pasar emas. Pada tanggal 5 Agustus 2015, LBMA telah mengedit dokumen tersebut di atas, yang sekarang menunjukkan 4.600 ton produksi emas murni. (Klik di sini untuk melihat dokumen LBMA asli dari server BullionStar, dan di sini untuk melihat versi yang diubah dari server BullionStar.) Silahkan lihat. Bukti 8. Courtesy LBMA. Dokumen yang diubah pada penyulingan statistik oleh LBMA Agustus 2015. Dalam versi yang diubah, ia mengatakan: Total produksi emas murni oleh penyuling pada List diperkirakan 4.600 ton pada tahun 2013, karena mendaur ulang bahan bekas, di atas produksi tambang dunia 3.061 Ton (sumber Thomson Reuters GFMS). Beberapa catatan penting: Dalam versi yang diubah, LBMA menyebutkan ldquo sebuah perkiraan untuk setiap rdquo produksi emas murni, walaupun tidak perlu membuat perkiraan karena semua penyuling emas LBMA yang terakreditasi yang berada dalam Good Delivery List diminta untuk memberikan yang tepat Data ke badan induknya. Data yang tepat diungkapkan dalam versi pertama panduan A ke The London Bullion Market Association, dan dinyatakan, ldquo total produksi emas murni oleh penyuling pada List adalah 6.601 tonnesququo. Dalam versi yang diubah, LBMA menyatakan bahwa statistik pemurnian bersumber dari Thomson Reuters GFMS, namun LBMA tidak memerlukan GFMS untuk statistik ini. Fakta yang mereka sebutkan GFMS, bagaimanapun, menunjukkan adanya cover institusional yang terkoordinasi. Tidak hanya perusahaan, juga LBMA menerbitkan data yang tidak lengkap dan menyesatkan. Versi yang diubah tersebut menyatakan bahwa produksi penyulingan mencapai 4.600 ton, yang merupakan angka bulat dan jelas cepat terbentuk. Beberapa minggu setelah nomor disesuaikan, LBMA menyesuaikan jumlahnya lagi, kali ini menjadi 4.579 ton (klik di sini untuk melihat dari server BullionStar). Jelas, pada beberapa kesempatan telah ada konsultasi dengan LBMA untuk mendapatkan statistik sesuai dengan GFMS. Dalam dokumen asli, LBMA menyatakan, produksi emas murni oleh Refiners pada Daftar tersebut adalah 6.601 ton pada tahun 2013, lebih dari produksi dunia dua kali lipat dari 3.061 ton rdquo, sementara dalam versi yang diubah mereka menyatakan, ldquoTotal produksi emas olahan oleh penyuling Pada Daftar diperkirakan 4.600 ton pada tahun 2013, karena daur ulang bahan skrap, di atas produksi tambang dunia 3.061 tonnesququo. Terkemuka, GFMS lebih memilih pasokan total yang terfokus pada produksi tambang dan skrap, daripada memasukkan pasokan institusional. Statistik penyulingan asli (6.601 ton) masih diungkapkan di majalah LBMA The Alchemist (78 di halaman 24), untuk dilihat dari server LBMA di sini. Rincian yang bagus tentang seberapa sering dan kapan LBMA mengubah statistik penyulingannya dapat dibaca di pos luar biasa Ronan Manlyrsquos Memindahkan goalpostshellip. LBMArsquos mengubah posisi pada statistik produksi kilang emas. Jadi tidak ada yang terhindar dalam mencoba menjunjung ilusi keseimbangan Sampah GFMS agar lengkap. Dalam contoh lain, GFMS mengecualikan pembelian emas oleh bank sentral China dari saldo Sampber. Pada bulan Juni 2015, Peoplersquos Bank of China (PBOC) meningkatkan cadangan emas resminya sebesar 604 ton, dari 1.054 ton menjadi 1.658 ton. Selama kuartal tersebut (Q2 2015) semua bank sentral lainnya di seluruh dunia adalah pembeli bersih sebesar 45 ton. Dengan demikian, secara total Sektor Resmi adalah pembeli bersih sebesar 649 ton. Sekarang, mari kita lihat saldo Sampgester GFMS39 untuk Q2 2015: Exhibit 9. GFS Courtesy. Saldo emas global SampD seperti yang diungkapkan pada Gold Survey 2015 Q2. Pembelian Sektor Komersial Bersih diungkapkan ay 45 ton. GFMS memutuskan untuk tidak memasukkan kenaikan 604 ton oleh PBOC hanya karena tidak memenuhi model keseimbangan mereka. Kenaikan 604 ton akan menetapkan balancerdquo ldquonet di -480 ton. Pembaca akan mempertanyakan keseimbangan dari outlier ini, jadi GFMS memutuskan untuk tidak memasukkan tonase tersebut. Menurut sumber saya, pembelian PBOC berasal dari penawaran institusional (dari luar negeri dan tidak melalui SGE), yang merupakan kategori penawaran yang tidak diungkapkan oleh GFMS dan oleh karena itu tonase tersebut menjadi masalah. (Catatan, GFMS mengungkapkan kenaikan PBOC dalam teks, namun tidak seimbang.) Untuk informasi lebih lanjut, baca posting saya Pembelian Emas PBOC: Memisahkan Fakta dari Spekulasi. Emas Lebih Banyak Sebuah Mata Uang daripada Komoditas Kelemahan model keseimbangan oleh GFMS adalah bahwa ia menggambarkan emas menjadi komoditas yang lebih banyak daripada mata uang. Ini berfokus pada output tambang dan emas pulih dari produk fabrikasi lama di sisi penawaran, versus penjualan eceran produk baru palsu di sisi permintaan. Dalam hal perusahaan, berapa yang dihasilkan (supply) versus konsumsi (demand). Sektor resminya, ETF dan perubahan inventori tukar kemudian ditambahkan ke saldo. Pendekatan keseimbangan Sampah komoditas oleh GFMS telah menyebabkan kesalahpahaman yang sangat mengakar tentang esensi emas dan formasi harga. Harga komoditas yang mudah rusak terutama ditentukan oleh berapa banyak produksi per tahun versus berapa banyak yang dikonsumsi (habis). Namun, emas itu kekal, tidak bisa digunakan dan nilai tukar utamanya didasarkan pada aplikasi moneternya, dari mata uang, atau uang jika Anda mau. Logikanya bagian terbaik dari perdagangannya dilakukan di atas cadangan tanah. Dari perspektif saya, dampak pasokan tambang global, yang meningkat di atas saham tanah sekitar 1,5 per tahun, dan penjualan eceran tidak ada hubungannya dengan formasi harga goldrsquos daripada yang diasumsikan secara luas. Kembali ke GFMS. Lihat gambar di bawah ini yang menunjukkan aliran Samping mereka untuk tahun 2015. Pameran 10. GFS Courtesy. Sampah global mengalir untuk tahun 2015. GFMS berpura-pura pasokan total adalah produksi tambang ditambah beberapa skrap, yang kemudian dipenuhi oleh permintaan perhiasan selain investasi ritel, fabrikasi industri dan pembelian sektor resmi. Cara mereka menyajikannya adalah menyesatkan. Aliran Sampd ini tidak lengkap yang mereka anggap emas diperdagangkan seperti komoditi lainnya. Tapi bagaimana dengan kelembagaan Sampd di atas tanah bullion Trades yang mendefinisikan emas sebagai mata uang internasional. Letrsquos melakukan perbandingan lain kali ini antara apa yang oleh GFMS disebut Permintaan Investasi yang Teridentifikasi, yang terdiri dari hellipversus elips yang saya anggap sebagai pendekatan permintaan investasi yang lebih tidak dipalsukan. Terdiri dari sekumpulan uang karton bar pembelian ETF Permintaan Kelembagaan Total Investasi Identifiable global, hellip mencatat kenaikan 5 besar di tahun 2015, mencapai 990 ton. Itu cukup banyak tonase antara Investasi Identifiable global oleh GFMS pada 990 ton dan permintaan institusional China di 1.400 ton. Kita juga harus memperhitungkan permintaan institusional yang tidak jelas, emas yang berpindah tangan di hub perdagangan seperti Swiss. Sayangnya kita tidak bisa selalu mengukur kelembagaan Sampd, tapi itu tidak membenarkan menyangkal subsistennya. Lihat tabel di bawah ini yang menunjukkan perbedaan besar. Pada bab berikutnya wersquoll secara khusus membahas pentingnya permintaan investasi terkait dengan harga emas. Pameran 11. Permintaan Investasi Emas Global 2015. Maksud saya adalah: berapa banyak pelaku pasar emas dan pemikir berpikir bahwa jumlah penawaran dan permintaan hanyalah puncak gunung es. Ini benar-benar merupakan kesalahpahaman yang mengejutkan yang diciptakan oleh perusahaan. Saat mengamati keseimbangan GFMS dalam pameran, ketidaklengkapannya terbukti dengan sendirinya. Di bagian bawah kita bisa melihat item baris ldquonet balancerdquo, yang mencerminkan selisih antara total supply dan total demand. Menurut GFMS, jika ldquonet balancerdquo adalah angka positif terjadi surplus di pasar emas global, dan jika ldquonet balancerdquo adalah figur negatif, pasar mengalami defisit. Di dunia nyata, angka ini tidak relevan. Pasokan dan permintaan emas menurut definisi selalu sama. Seseorang tidak bisa menjual emas tanpa pembeli, dan seseorang tidak bisa membeli emas tanpa penjual. Selanjutnya pasar emas itu dalam dan cair. Jadi, bagaimana bisa ada perbedaan antara total pasokan dan total permintaan dalam saldo GFMS Seperti yang ditunjukkan Irsquove sebelumnya, karena GFMS tidak memasukkan Samps Sampsional institusional yang pada kenyataannya menentukan perbedaan dan jauh di luarnya. Dalam semua kesederhanaannya, item balancerdquo ldquonet menunjukkan data mereka tidak lengkap. Letrsquos memiliki tusukan lain dalam hal ini. Bagaimana mungkin ada balancerdquo ada di dunia nyata, misalnya di tahun 2009 Menurut GFMS, pasar emas memiliki surplus 394 ton pada tahun 2009. Tapi bagaimana dengan para penambang meninggalkan 394 ton yang tidak dapat mereka jual Atau beberapa entitas supranasional memutuskan untuk menyerap surplus ke Menyeimbangkan pasar Tentu, ini bukan yang terjadi. Total penawaran dan permintaan total selalu sama, namun GFMS tidak mencatat semua perdagangan. Apalagi menurut saya kata-kata ldquo surplus rdquo dan defisit ldquo rdquo tidak berlaku untuk emas. Tidak ada defisit emas yang akan selalu ada persediaannya. Pada harga yang tepat itu. Terkadang ekonom Keynesian mengklaim bahwa tidak ada cukup emas di dunia untuk dijadikan mata uang cadangan global. Para ekonom Austria kemudian menanggapi dengan mengatakan bahwa akan selalu ada cukup emas dengan harga yang tepat. Saya setuju dengan orang-orang Austria dan argumen mereka juga memvalidasi mengapa tidak ada defisit emas. Ada lebih banyak bukti item balancerdquo ldquonet yang dipresentasikan oleh GFMS tidak ada artinya. Meskipun menurut GFMS, pasar memiliki 394 ton ldquosurplusrdquo pada tahun 2009 harganya naik 25 selama tahun itu. Ini tidak masuk akal secara ekonomi. Surplus menunjukkan penurunan harga, bukan sebaliknya. Tellingly, kekuatan SampD yang disajikan dalam neraca GFMS seringkali berkorelasi negatif dengan harga emas, seperti yang terjadi pada tahun 2005, 2006, 2009, 2010 dan 2014 (pameran 1). Sebagai kesimpulan, GFMS SampD balance tidak hanya tidak lengkap, item lancip balancerdquo yang dihasilkan menyesatkan sehubungan dengan harga. Berikut adalah beberapa grafik yang menunjukkan kesimpulan ini. Jika kita plot ldquonet balancerdquo versus harga akhir tahun emas kita dapat melihat korelasi yang sering negatif. Silahkan lihat di bawah ini. Diagram bagan bar hijau ldquonet balancerdquo menunjukkan korelasi positif dengan harga emas, bar grafik merah menunjukkan korelasi negatif (catatan, sumbu kiri dibalik untuk gambaran yang lebih jelas antara harga ldquodeficitsurplusrdquo dan harga emas). Seperti yang Anda lihat hampir setengah dari bar chart balancerdquo ldquonet berkorelasi negatif dengan harga emas. Bukti 12. GFMSrsquo pasar emas ldquonet balancerdquo versus harga emas. Kita bisa bertengkar jika balterdquo ldquonet pada tahun 2014 berkorelasi positif atau negatif terhadap harganya. Katanya korelasinya negatif karena harga emas di tahun 2014 tetap datar dalam dolar AS namun naik di semua mata uang utama lainnya. Berbeda dengan ldquosurplusrdquo yang dipresentasikan oleh GFMS. Pikiran Anda, meskipun item balancerdquo ldquonet sering berkorelasi negatif dengan harga emas, dalam Survei Emas 2016 di negara bagian GFMS di halaman 9: Dari sisi Net Balance, 2015 menandai tahun ketiga di mana pasar emas tetap surplus, dan Oleh karena itu tidak mengherankan bila pasar bear terus berlanjut. Perkiraan penurunan output tambang global dan pemulihan permintaan secara bertahap akan melihat surplus fisik yang terjadi pada tahun 2016, memberikan dukungan terhadap harga emas dan meletakkan dasar bagi prospek yang lebih baik. GFMS suka berpura-pura ldquosurplusrdquo atau ldquodeficitrdquo yang timbul dari keseimbangan mereka berkorelasi dengan harganya, namun faktanya mengungkapkan hal ini tidak benar. Mari kita plot item garis defisititraktori ldquophysical oleh GFMS (pameran 1) versus harga emas. Hal ini menghasilkan korelasi yang lebih negatif. Bagan 13. GFMS pasar emas ldquophysical surplusdeficitrdquo versus harga emas. Latihan ini menunjukkan bahwa korelasi positif antara ldquosurplusrdquo atau ldquodeficitrdquo yang timbul dari keseimbangan GFMS dan harga emas hanyalah sebuah kebetulan. Tidak mengherankan bila seseorang mengetahui data Sampd mereka tidak lengkap. Hebatnya, bagan terakhir juga dipublikasikan di Gold Survey 2016, namun GFMS memilih untuk tidak membalikkan sumbu kiri dan doesnrsquot mengungkapkan apa yang kita lihat adalah surplus atau defisit. Akibatnya surplus terbesar (2006, 2007, 2009, 2010) nampaknya berkorelasi dengan kenaikan harga, meski pada kenyataannya justru sebaliknya. Bandingkan grafik di bawah ini dengan yang di atas. Bukti 14. GFS Courtesy. GFMS juga menerbitkan saldo SampD untuk perak (logam moneter yang sebanding dengan emas). Untuk perak, korelasi yang disajikan oleh GFMS antara ldquosurplusrdquo atau ldquodeficitrdquo dalam kaitannya dengan harga bahkan lebih lemah. Bagan 15. GFMS pasar perak ldquonet balancerdquo versus harga perak, seperti yang diungkapkan dalam Survei Perak 2016. Pameran 16. Pasar perak GFMS surplus defisititratik versus harga perak, seperti yang diungkapkan dalam Survei Perak 2016. Menurut GFMS, pasar perak selalu mengalami defisit. , Tapi harganya naik dan turun. Jelas GFMS mengabaikan ukuran kelembagaan Sampd untuk perak. Kesimpulan Menurut pendapat saya, ketika Gold Fields Mineral Services (GFMS) didirikan beberapa dekade yang lalu, mereka membuat kesalahan dengan mengadopsi pendekatan keseimbangan Sampel komoditas. Tentunya dengan niat terbaik mereka mengumpulkan kecerdasan dan mengambil data dari pasar. Tapi kita harus sadar ini bukan gambaran penuh. Data yang paling penting tidak diungkapkan oleh GFMS. Ketika sampai pada apa yang mendorong harga emas GFMS dan saya setuju, hal itu ditentukan oleh peran emas sebagai mata uang dalam ekonomi global. Saat membaca bab PRICE AND MARKET OUTLOOK di Gold Survey 2016, GFMS berbagi wawasannya dengan harga emas. Faktor-faktor yang disebutkan adalah: Gejolak di pasar saham global Sebuah pendaratan keras China Ketegangan geopolitik pada stimulus bank sentral Timur Tengah (QE) Kelemahan ekonomi global Kebijakan suku bunga oleh bank sentral Aset berisiko rendah permintaan safe haven Jadi jika faktor-faktor ini mendorong harga emas, Dalam kategori Samper apakah ini akan terwujud Apakah (besar) investor membeli dan menjual perhiasan Atau batangan bullion yang saya kira yang terakhir. Menurut analisis saya, harga emas sangat ditentukan oleh permintaan institusional, dan pada tingkat yang lebih rendah, ETF dan permintaan ampli bar ritel. Letrsquos melakukan latihan untuk melihat tren Sampah emas fisik yang berkorelasi dengan harganya. Sebagian besar pasokan pada saldo GFMS terdiri dari output tambang dan sebagian besar permintaan pada saldo GFMS terdiri dari konsumsi perhiasan. Tapi jika kita plot volume ini versus harga emas dalam grafik, tidak ada korelasi push and pull. Misalnya, saat harga emas melonjak dari tahun 2002 hingga 2011 konsumsi perhiasan pun tidak naik. Tidak juga itu melampaui persediaan tambang. Hal sebaliknya terjadi, untuk dilihat pada grafik di bawah ini. Ini karena permintaan perhiasan ndash harga sensitif saat harga naik permintaan perhiasan turun, dan sebaliknya. Permintaan perhiasan tidak mengendarai harga emas. Exhibit 17. Permintaan eceran GFMS, versus penawaran tambang dan skrap versus harga emas. Saya juga menambahkan permintaan ampli bar ritel. Yang menarik untuk dilihat adalah permintaan bar pembeli eceran bar di satu sisi merupakan penggerak harga, bergerak naik dan turun selaras dengan harga emas, disisi lain harga bisa sensitif memiliki lonjakan singkat saat harga emas turun. Korelasi terbaik antara SampD fisik dalam kaitannya dengan harga emas dapat dilihat pada institusi dan ETF SampD. Salah satu pusat perdagangan emas terbesar di Barat adalah Inggris, rumah dari London Bullion Market yang juga mengunci ETF terbesar yang diberi nama GLD. Inggris tidak memiliki produksi tambang dalam negeri, tidak ada kilang dan permintaan emas nasional yang dapat diabaikan dalam skema yang lebih besar. Oleh karena itu, dengan mengukur arus bersih Inggris (impor dikurangi ekspor) kita bisa mendapatkan rasa permintaan dan pasokan kelembagaan dan ETM. Misalnya, jika Inggris adalah pengimpor bersih - permintaan impor lebih besar daripada pasokan ekspor - yang menandakan tarikan bersih di atas saham tanah. Sekitar sepertiga dari arus bersih UKrsquos sesuai dengan perubahan persediaan ETF, dua pertiga lainnya mencerminkan Sampling institusional murni. Pameran 18. Arus bersih Inggris versus harga emas. Pameran 19. Aliran bersih Inggris, perubahan inventori GLD, impor bruto dan ekspor bruto versus harga emas. Dalam grafik di atas kita dapat mengamati korelasi kuat yang luar biasa antara arus bersih UKrsquos dan harga emas. Inggris adalah importir bersih dengan kenaikan harga dan eksportir bersih dengan harga yang menurun. Korelasi yang ditunjukkan bisa menjadi kebetulan, meski tidak ada jaminan akan berlaku di masa depan. Dua grafik di atas menunjukkan harga emas sebagian besar ditentukan oleh penawaran dan permintaan institusional di atas cadangan tanah. Secara efektif, GFMS menyembunyikan bagian terpenting arus emas fisik global. Ketika saya bertanya kepada seorang analis di salah satu firma terdepan mengapa perusahaannya tidak mengukur institusional SampD, dia mengatakannya dengan jujur, karena sangat sulit untuk memperkirakannya secara akurat. Dan itu. Seperti yang saya tulis sebelumnya, saya juga tidak bisa mengukur Sampg semata institusional institusional. Namun, informasi yang sangat sering tersedia bagi publik memberi kita gambaran yang mengasyikkan darinya, dan ini menunjukkan lebih relevan dengan harga emas daripada yang terus ditonton perusahaan. Tidak mengetahui secara pasti apa yang dimaksud dengan sampel Samprional institusional karena tidak berarti GFMS seharusnya tidak memperhatikannya. Tapi perusahaan terus mencoba untuk menegakkan ilusi bahwa data yang mereka jual selama puluhan tahun telah selesai. For if they would plainly confess it was incomplete, future business could be severely damaged. What I blame these firms is that theyrsquove created a meme that the gold market is as large as annual mine supply. This has caused all sorts of misconceptions. Often I read analyses based on a comparison between quantitative demand and mine output. Such analyses are likely to jump erroneous conclusions. Simplified overview gold flows 2015: The data falsely presents gold to be more of a commodity than a currency, having caused deep misconceptions with respect to the metals trading characteristics and price formation. Im going to presume your improper reference to gold as currency really means as money. Currency is just one of several representations of money. Others are coins, checks, and most commonly of all, records in ledgers. Gold, of course is not money, as is easily proven below. The supply and demand balances by the firms portray gold to be more of a commodity than a currency, as the gist of the balances reflect how much metal is produced versus consumed - put differently, the firms mainly focus on how much gold is mined versus howmuch is sold in newly fabricated products. One of the two most necessary attributes of money is perpetual perfect balance between supply and demand for the money everywhere. Your assertion above openly admits golds failure to meet that attribute. However, in reality gold is everlasting and cannot be consumed (used up), all that has ever been mined is still above ground carefully preserved in the form of bars, coins, jewelry, artifacts and industrial products. The other of the two most important attributes of money is that it is perpetual free supply. The above statement, even if it were true, proves gold does not meet this attribute. There is absolutely no way it can. Partly because of this property the free market has chosen gold to be money thousands of years ago, and as money the majority of gold trade is conducted in above ground reserves. Indisputably, total gold supply and demand is far in excess of mine production and retail demand. This is a religious statement, exactly of the sort Copernicus and Bruno and Columbus ran into. When proponents of nonsense have to resort to religions statements there is little hope for them. ever try to change someones religion They have already proven they are irrational. Money is obviously an in-process promise to complete a trade. Heres the proof: Examine trade: (1) Negotiation (2) Promise to Deliver (3) Delivery. With simple barter exchange, (2) and (3) happen simultaneously on-the-spot. Trade involving gold, regardless if its nuggets or called currency by certified weight and purity, fits this case. When the trade is completed using gold. the trade is complete (2) and(3) happen simultaneously. When the trade involves money, it is just started. Its not completed until delivery. Money, invented by traders. not chosen by some free market. enables (2) and (3) to span time and space. The trade begins at (2) and ends at (3) and in between, the certified promise is money. It becomes the most common object of simple barter exchange. primarily it is in free supply, never changes value, and is thus universally accepted. The trade is not complete until (3). No money exists before (2) nor after (3) for any particular trade. Thus, there is always a perpetual perfect supply demand balance for the money. Its the nature of every trade and necessary to guarantee zero inflation of the money itself. And since any trader can make a trading promise and get it certified any time he wants, money is obviously in perpetual free supply. The trader need not wait for a commodity to be dug up and refined. or saved. before he can make his trading promise. Thus money does not restrain trade at all. Of course that cant be said about gold. Gold is perpetually in short supply and in the wrong place and the wrong time. Now, if you can point out a defect in this proof, make it. If you can prove money need not be in perpetual free supply, prove it If you can prove money need not maintain perpetual perfect balance between supply and demand for the money itself, prove it If you think gold meets these attributes, prove it. Otherwise, drop your religion and capitulate. Gold is not money. no reason to believe the devil of fractional reserve banking hasnt crept into bullion banks. the world pupulation has doubled in the last hundred years, which puts more onto the demand side, and most of these people are poor, and the poor love gold most of all. a central banker is just a man with a lot of customers and to sell his product he needs to give his customers some value, so they put gold in their vaults. the central bankers dont want the poor trading in the relic so over the centuries they altered the narrative in the bible to associate gold with false idoltry, and misers, (misers are evil, that is savers which is bernankes favorite sermon) the struggle between good and evil, the 1 who made theirs with paper money, and the 99 has been lost, and the poor love gold and more of us will be poor, are poor. obvious connundrum which leads to a multidecade bull market in gold miners, because the available gold will be hoarded in the coming crash. the only gold left is new supply. the first salvo of the war in poverty, not of poverty, was fired at the start of the century, were all poorer and were mad. so we entertain a billionaire might make us all a little richer again. if they abolish cash, demean the 1, then where do you park what used to be your money in gold probably. all paths lead to gold, paper wealth was never a universal solution. wealth in the US in the 1800s was land, cattle and gold. land and cattle are no longer wealth in a contracting global economy. gold bars will be the new iphone, consumer friendly, with no monthly fees. gold speaks to you, like it does everyday for poor people in India and China. good news you will have gold, and you will be poorer in money, but thats the bargain. ( if you cant stand spelling errors dont even start reading this, im dislectic and I know i make typing errors, I see the words are wrong but I just dont always have the time to lookup all these words how to type them, besides, being on an ipad its a pain in the ass to have to write a reaction and simultaniously have to surf the net for finding the right spelling, sorry) Since waking up some 10 years ago the most important lesson learned is never trust any anyone but your own. This for me means both challenge views that are contrary to my own thoughts as well as views that support my own thoughts. What ever your belief is we have to thank Koos for giving us some info we cant find anywhere else or only with some serious effort. My next challenge is to find out, with the info that i think is correct, where it all will lead to. I sometimes simply think that in this manipulated world it does not help at all to know a lot af actual facts. It is more about some average belief out there and what those in command do, look at all current conflicts and mess all around the world, that forms reality more than pure facts and what should be logic based on these facts. So for gold that some of us have as insurange it simply will be that an insurange. And even if an accident occurs we still do not have any guarantee the insurange will pay out :( Im still happy with the insurange I have, and do know that you cant insure the house anymore as soon as it is burning. The rest is like most other aspects in life: quite vague. The supply and demand balances by the firms portray gold to be more of a commodity. Yet, Central Banks consider Gold as a currency. Good article. Gold is the Enemy of Fiat Currencies Only TPTB use gold as currency between themselves, IMO. They try to keep the rest of us down. When I am on my fourth beer, an article needs to much more to the fucking point. Cant read diarrheatic drivel. I know what you are saying. But articles of value are harder to read. But while harder to read, this one has more value. I have kept this article open in a browser for a few days until I could get the time and the ability to focus on the writing before completing it. I am glad I did. Thanks for writing it. I am now thinking about the en tire body (both visible and submerged). I look forward to future analysis of the submerged body (both real and paper). I also think there might be some clues for analysis on what currency planners use to manage their currency. No Well you certainly seem to write it well enough. Perhaps you should get yourself a copy of My Pet Goat. and make sure you have it the right way up.How to Get the Most Out of This Book Thank you for accessing the eBook quotMy 1 Day Trading Technique quot . This book is designed for beginning, intermediate and advanced traders. The presenters in this book are leading experts in trading Stocks, Options, Futures and Forex. You will be exposed to high-probability trading strategies from 8 industry experts. As an added bonus, we have included a trading psychology chapter and a chapter on potential tax advantages for active traders. As you read this book, you will be exposed to multiple strategies that have high probabilities of success andor high profit. Most of the strategies in this book are divided into three sections: ldquoThe Game Planrdquo ndash An introduction to a charting technique. The strategy is then thoroughly explained along with illustrations and examples. ldquoThe Movierdquo ndash The chapter is accompanied with a video which outlines how to use this strategy, with examples. ldquoSpecial Offersrdquo ndash If you really like a strategy, you can follow the presenter and the strategy. There are thousands of dollarsrsquo worth of trading tools, indicators, training and mentoring services, books and videos available at steeply discounted prices. In short, you will have all of the information you need to trade your new favorite strategy tomorrow. Some of the things you will learn in this book are: How to Spot High-Probability Setups with the Ichimoku Cloud How to Trade NASDAQ Futures (NQ) on the Opening Bell How to Eliminate the Noise of Popular Indicators and Find Precise Entries How to Identify Optimum Setups with the ldquoRubber-Bandrdquo Effect Using a Simple Strategy that Targets Moves by Institutional Investors And much, much, more At ChartExperts . it is our sincere hope that you take away several strategies that you can use when you are done reading this book. You will also learn about markets that you currently donrsquot trade, and you will find out if they are suited to your trading personality. Finally, make sure to subscribe to ChartExperts. We provide free ebooks, weekly articles, on-demand videos and many other publications for active traders. Our presenters are world-renowned industry experts and our content is provided free of charge in a relaxed and friendly setting. Cheers to your trading success Chapter 01 8 Forex Life Hacks To Make You a Better Trader Joshua Martinez, MarketTraders, Inc. Some of the most popular social media posts are the so-called ldquoLife Hacksrdquo. These fun little strategies take the worry out of doing everyday chores and generally make life easier. Just like you can use life hacks to make life easier, you can use strategies to make trading the Forex easier. By sticking with these Forex Life Hacks, you increase your chances of Forex success: Forex Life Hack 1: Memorize the Top Candlestick Formations Every trader knows to watch the candlesticks, but how many know candlesticks enough to see their recurring patterns Few traders realize that candlesticks do more than show what the market is doing in that time frame, they also come together to create formations that expert traders can spot and use for profits. There are a wide variety of candlesticks, and a lot of them have some pretty unique names, but there are a few that are important to remember: Some candlestick formations to take note of are the Bullish Tweezer Bottom, the Bullish Piercing Line, the Bearish Engulfing Candle and the Bearish Shooting Star. Each of these names gives an indication of the market direction and makes some connection between the candlestick and its wick. Spotting these formations early allows you to get into the market right before a major move occurs, thus increasing your profit potential and allowing you to strike while the iron is hot. Forex Life Hack 2: Stick to 2 or 3 Strategies. Maks. A phrase we like to use is ldquosimplicity leads to pipsrdquo. When you come at the market with 20 different strategies, you end up stretching yourself too thin and you miss out on profits because yoursquore trying too hard. Thatrsquos why itrsquos important to limit the strategies you use to two or three at a max. Why three Itrsquos not because itrsquos a handy number, or one that translates easily. Itrsquos because there are three types of market movements, and it helps to have a strategy for each. You need a strategy for when you day trade, a strategy for when you are in a swing andor a position trade, and one strategy for sideways movement. Having three trusted strategies for each of these market conditions means that you should be more prepared to quickly review the market, whether the market is making for quick day trading movements, or is experiencing consolidation that spans ten or more days. You have something to analyze the conditions against, and the strategies to help you take advantage of these moves. Forex Life Hack 3: Use Multiple Time Frames to Trade The number one question new traders ask is what time frame they should trade within. The answer to this varies, but the bottom line is You should always be trading on more than one time frame How can this work Itrsquos simple, time frames donrsquot work in a vacuum. Each one has an effect on the other, and patterns that appear in long-term trades make appearances in short-term trades. dan sebaliknya. For example, if yoursquore looking to enter on the one-hour chart, you want to begin your analysis on at least the 4-hour chart or any larger time framersquos chart. The rule is to always have your secondary, larger time frame be at least four times the size of your initial time frame. Think of timeframes of having a parent-child relationship to each other. The larger timeframes will have an effect on the smaller ones, much like parents have an effect on their children. The larger timeframe sets the scene for the smaller timeframes. Once yoursquove established the overall direction of the market by the larger timeframes, you can trade the smaller timeframes for the specific entry and exit points. A monthly time frame typically shows the next A-B-C-D formation for only the next 2,000 pips-worth of movement. The daily time frame shows the corresponding movements that create the larger A-B-C-D formation for the next 500 to 1,000 pips worth of market action. The great thing about this method is that it solves the largest problem that faces many currency traders. That problem is knowing when to stop buying and when to start selling. With the larger movement identified, traders can better determine when the marketrsquos tides are preparing to change for a full movement in the other direction, as opposed to the natural wave-like movements that make up large market swings. Forex Life Hack 3: Never Risk More than 2 - 5 of Your Account A good piece of advice in life is to never risk more than yoursquore willing to lose. Whether yoursquore trading in the stock market or taking a mortgage out on your house, you should never put up more than you can live without. This is especially true when the thing yoursquore risking is money. Itrsquos worth mentioning again: You should NEVER risk more than yoursquore willing to lose. The Ultimate Traders Package on Demandtrade suggests never risking more than five percent of your account. You have to understand, before going into the market, that every trade you might do comes with it some risk. There isnrsquot a trader in history that has a 100 winning percentage. The fact of the matter is that you will lose at some point, but when you manage your risk successfully you can take those losses and live to fight another day. You also want to be able to put in enough money to make a profit. After over 20 years of experience, we have figured out that the sweet spot between making money, and not going bankrupt when losing money, falls in the two to five percent range. We recommend beginner or more risk-averse traders to start with risking only two percent of your current trading pool in every trade. Once you become more experienced in the market, or your profits have risen enough, you can move to three, four, or the full five percent. Forex Life Hack 4: Identifying and Trading the Kingrsquos Crown One of the more famous, and often used, strategies is something called the Head and Shoulders pattern. This happens when a bullish trending market makes a peak and begins to retract. The name comes from the picture the market makes as it peaks and valleys. The highest point is the head, and the two lows on either side of it are the shoulders. In theory, you draw a ldquonecklinerdquo connecting the two shoulders and begin to trade at that point. The problem is, the market will often overcorrect itself and yoursquove taken a loss before you knew what hit you. Thatrsquos why the FX Chieftrade prefers to trade a different pattern: The Kingrsquos Crown. The Kingrsquos Crown is trading beyond the ldquoshouldersrdquo of the Head and Shoulders pattern. Once the market takes out a low of support, it has a tendency to bounce back up and wave before the market finally falls. In this strategy, your stop would be taken out on that rally right before the market turned to complete your direction. Basically, you arenrsquot trading the neckline, you are trading the breaking point beyond the lowest low. This extra spike in the market (turning the person in a crown) allows you to see the true indication of the markets and could lessen the chance you have of taking on losses in the future. Forex Life Hack 5: Learn to Love the Stochastic RSI Think of the ups and downs of the market as trends like in the fashion industry. Take leg warmers for instance. Back in the 80s leg warmers were very popular, they were used by a large segment of the population, and then once it hit a certain point it became TOO popular and there was a backlash created against it, making the trend slowly go away. A lot of fashion manufacturers would have loved to have known when the trend was starting to go away. They would have wished they knew some kind of indicator. There might not be an indicator like that for the fashion industry, but there is for the markets. Itrsquos called the stochastic RSI, and it could be your key to trading. The stochastic RSI is made up of two lines that serve as a sort of benchmark for when the market is looking to reverse. If the stock is traded too high, it will break that line and begin to trend down. If the stock is going too low, it will break the bottom line and start trending back up. Having a handle on the two barriers that the stochastic line makes up will give you a sense as to when you should reverse your direction and go from bull to bear, and vice versa. Forex Life Hack 6: Utilize Stop-Losses for Your Wins How familiar does this sound You put in to the market and, like a good trader, you set your stop. However, you find yourself constantly being taken out just before your big win. Itrsquos a common problem that has one easy solution You need to change your stop-losses as the market changes As the market fluctuates, the stop losses grow larger in size. This volatility creates higher highs and higher lows, which can spell higher profits for smart traders. And smart traders adjust their stop losses to mirror the market. Traders make stop losses to prevent themselves from losing their entire account over the course of one trade. By setting a minimum number for the market to hit, once the market hits that number, the trade is automatically ended and the loss is taken. The way to properly use a fluid stop-loss number is to move the minimum number in accordance with the market moves. Letrsquos look at an example. The chart below has several yellow circles. These circles represent the stop-loss price at different times in the trading timeframe. Starting from the furthest left circle, you would adjust your stop-loss to match the next lowest number the market hits (which is the new yellow circle). Even without the benefit of seeing the actual numbers, you can see the difference between the furthest left and the furthest right circle. This pip difference would be lost if you didnrsquot utilize a moving stop-loss number. How do you know when to move your stop-loss Itrsquos easy. Look for a high or a low that has two candlesticks to the left, and two candlesticks to the right that are either higher or lower from that point. A high will have two lows to the left and right, a low will have two highs to the left and right. Forex Life Hack 7: Using Reversals to Your Advantage Trading occurs in a 24-hour window consisting of three different trading sessions: European, U.S. and Asian sessions. The European session has the most movement, followed by the U.S. and then the Asian markets. More often than not, the market will reverse directions when one session ends and the other begins. Itrsquos by playing off this reversal that the most pips are captured. It stands to reason that if the European session is trending bullish that once the American session kicks in, it will set up a reversal and the market will turn into a bear. By utilizing this strategy you can pinpoint the reversal points, take advantage of the market movement, and identify when a market high and low will occur. With three trading sessions happening per day, there is the potential for 2 reversal points per day, which means that using only one strategy can dictate how you look at three different markets. Forex Life Hack 8: Pinning Your Trading Personality There are four distinct types of trading personalities. Finding yours could be the key to trading your strengths and limiting your weaknesses. Itrsquos rare for a new trader to know their personality, so read the explanations and see if there is one (or multiple) that describes you. The Now Trader: The now trader wants to get in, get their pips, and get out. They generally use smaller time-frames, spend less time per-day trading and capture smaller pip numbers. However, because they trade in such short timeframes, the Now Trader tends to trade more often and have more straightforward trading strategies. The In-The-Game Trader: These traders love to check into the market daily, but prefer their action to be longer-lasting and tend to favor larger pip captures over a longer period of time. The daily trader often trades in the more mid-range timeframes and pays close attention to reversals and predictive fibs. The Adrenaline Junkie Trader: These traders only trade once, or a couple times, per month based on major announcements such as quarterly or earnings reports. They love the riskiness of the market and tend to trade for only a couple hours at a time, but they end up winning big if their strategies hold true. The Low-Maintenance Trader: The ultimate set-it-and-forget-it trader. They like to trade in the long-term by utilizing strategies that end up with big profits over many months. They arenrsquot looking for the thrill of the high-risk maneuver, or the commitment of a daily trading schedule. Rather, they are banking on safer picks that will benefit them in the future. There is no right or wrong way of trading, there is potential to make money in all of them. What matters as a trader isnrsquot when, or how often, you trade. The key to successful trading is managing your risk, developing your strategy, and making smart decisions based on the charts. Like any Forex tip, these canrsquot guarantee a win, and trading the Forex has an inherent risk involved. However, these tips can provide some insight into the mindset of those who have successfully traded in the past. Using the tips seen here along with sound risk management, having a secondary source of income is possible by trading the Foreign Exchange. Get more Forex Life Hacks, strategies, and Forex education by ATTENDING A FREE WEBINAR from the experts at Market Traders Institute. Before his days as an expert analyst and trader seen in Trader Planet39s Digital Journal . Your Trading Edge and FX Street . Josh was your average guy before him became the Forex world39s FX Pathfinder. He knew he wanted to do something he was passionate about for a living, but it seemed like nothing was working out. Josh has made a name for himself with the London Daybreak strategy and trading feats such as doubling his trading account in a single month and earning 10,000 in 30 minutes with his personal trading strategies. As a course creator, mentor and active instructor with MTI, you can find Josh in MTI student classes, live training sessions and MTI39s free workshop series that are open to the public. My 1 Day Trading Technique: The Hoffman Inventory Retracement Bar (IRB) Trade By Rob Hoffman, BecomeABetterTrader Award-winning Approach to Identifying Institutional Trading Opportunities Developed and used to win trading competitions around the world, the Hoffman Inventory Retracement Bar (IRB) Trade has become one of the most popular ways to identify where short-term countertrend institutional inventory has subsided and when itrsquos time to re-enter into a tradersquos original trend direction. What you will learn here is how to identify when the conditions arise to make the trade, the entry points, and exit strategy. What is the Hoffman Inventory Retracement Trade (IRB) The IRB Trade is a strategy that is used to identify specific types of institutional trading activity that is counter to the prevailing trend at hand, and then identify entries when the short-term countertrend inventory activity has come to an end and the market is likely ready to resumersquos its original trend. While it is common folklore in the investment industry that institutions, like wolves, travel in packs, the reality is that institutions are not all sitting around at a table conspiring as a group about how to part retail traders with their money. The institutional investment business is extremely competitive and these firms are very much out for themselves and have their own objectives and performance metrics to achieve to appear most attractive to prospective investors at any given time. Therefore, this strategy is designed to identify when one or a handful of institutions are moving inventory in and out of the market and are straying away from the markets current path causing a short-term retracement against the trend. We are subsequently looking for the market in question to resume its preexisting trend when those short-term countertrend institutional activities and inventories have dried up. The Rules For The Inventory Retracement Bar (IRB) Identification In an uptrend ndash Look for candlestick bars that open and close 45 or more off their high. Figure 1 shows four individual and unique examples of the IRBs in an uptrend for illustrative purposes In a downtrend - Look for candlestick bars that open and close 45 or more off their low. Figure 2 shows four individual examples in a downtrend for illustrative purposes. In the absence of the advanced trend identification systems Rob Hoffman uses, a simple approach to trend identification is looking at the 20 EMA (Exponential Moving Average) and asking yourself if it appears to be in approximately a 45 degree angle based on the timeframe yoursquore looking to trade over the 20 bars of data (i.e. 5 min. 60min, Daily, Weekly, etc.). The next higher timeframe above the one yoursquore looking to trade should also be flowing in the same direction. For instance, if yoursquore trading off of a 5 minute chart and itrsquos in an uptrend, you would like to see that your 10 or 15 minute chart also in an uptrend. It should be flowing in the same direction. If itrsquos sideways, or worse yet, trending in the opposite direction, your trade is much more likely to fail. The Entry Strategy Once an IRB and proper trend is identified, the next step is to allow the market to move along and wait for the price action to break one tickcentpip below the low of the IRB in a downtrend. In an uptrend yoursquore looking for the market to break one tickcentpip above the high of the IRB. While it is not an absolute, it is preferred that the price breaks beyond the IRB within the next 20 bars based on the time period yoursquore trading. For example, if yoursquore trading off of a 2 minute chart, you would ideally like to see the break in the next 40 minutes. In general, the sooner (i.e. the next five bars as an example) it is better for trend resumption. The Trailing Stop Exit Strategy While many traders are specific dollar target traders, the preferred method is more of a support and resistance target based methodology backed up by a trailing stop to ensure you are not giving back those profits during any snapbacks against your position. Typically, Rob Hoffman prefers a trailing profit stop moved up to 50 trailing of profit achieved when yoursquove made it 50 of the way to the intended overall profit target. Then move the trailing stop to 80 of profit earned as you approach 80 of the way to your intended target. Then move the stop to 90 of profit achieved as the major support or resistance target level is hit. At this point, if no further progression is made in price, then trail right to the current bidoffer with the intent to exit. If one more spike of energy comes in to trap unsuspecting retail traders with a false breakout, we manually trail immediately behind price during the spike until it pauses, then wersquore taken out with profit. Either way a win-win trading opportunity. Common major levels include key Fibonacci levels, previous dayrsquos highs and lows, daily, weekly and monthly pivot points, etc. For maximum comfort with the strategy, it is preferred that you use this with your own favorite support and resistance levels. Figure 3 Live Trade Example: Below the middle chart highlights in yellow the intended target, a pivot point. As we approach 50 of the way to the target, we trail the stop to 50 of profit earned. Figure 4 Live Trade Example: As we approach 80 of the way to the target, we trail the stop to 80 of profit earned. Figure 5 Live Trade Example: As we approach intended target we trail the stop to 90 of profit earned. This gives the trade an opportunity to have one more false breakout move above the target that allows us to pull out a little more profit. Figure 6 Live Trade Example: If trade holds target and fails to break through we move stop to current bidoffer and wait to be taken out of the trade. If one more spike of energy comes in to trap unsuspecting retail traders with a false breakout, we manually trail immediately behind price during the spike until it pauses, then wersquore taken out with profit. Either way a win-win trading opportunity. Figure 7 Live Trade Example: The bid was hit and the maximum profit achieved Based on the premise of this trading strategy, the expectation upon the entry is that the market will continue into the original direction it was heading after its brief institutionally driven pullback against the trend. Very frequently, after breaking through IRBs, the market will actually rapidly accelerate with fast action and wide ranges as everyone starts to realize that the brief pullback was merely a pause by one or a few institutions against the intended direction as the market moves to catch up with its original intent. With that said, once a trade is entered, the price should not retrace back beyond the opposite side of the IRB. For instance, if the trade is entered one tickcentpip below the low of the IRB in a downtrend, it should not stop and reverse to one tickcentpip above the high of that IRB. If it does, that market may be forming more of a reversal pattern and thus the need to exit the position and move on to the next opportunity or use one of Rob Hoffmanrsquos phenomenal market reversal strategies to capture the move. When not to use the strategy This strategy was primarily designed to identify and take advantage of trend continuations after counter trend institutional inventory exhaustion. Therefore, this trade is not to be used in a sideways market conditions as continuation failure will frequently occur. Why This Strategy Works In general, the market tends to trade directionally with as few retail traders on board the correct direction as possible. This strategy is so effective due to its ability to find high probability areas where three things are happening to retail traders in an uptrend: Buyers are being distracted from taking long side trades when they see the pullbacks off the highs, scaring them into believing the move is over. During pullbacks, sellers are being given false hope that any shorts taken earlier in the uptrend may finally start to work. Buyers who bought the high during rapid wide range ascents hoping it will go higher get stopped out on the pullback. After all of these events above, once a new IRB to the upside appears and is pierced, the market is much more likely to move without all of those traders above on the right side of the market. In a downtrend these three things are happening to retail traders: Sellers are being distracted from taking short side trades when they see the pullbacks off the lows, scaring them into believing the move is over. During pullbacks, buyers are being given false hope that any buy side trades taken earlier in the downtrend may finally start to work. Sellers who sold the low during rapid wide range descent hoping it will go lower get stopped out on the pullback. After all of these events above, once a new IRB to the downside appears and is pierced, the market is much more likely to move without all of those traders above on the right side of the market. Used During International Trading Competitions Figure 8 shows one of the seven trades taken using this strategy during the International Trading Competition held in Paris, France. The black vertical arrow highlights the IRB and the black horizontal arrow shows the intended area of entry for trades using this strategy. Robrsquos Strategy Checklist Key Points To Remember No more weight is given to any IRB based on whether its close is above or below the open (i.e. green or red candle). In addition, think about the concept of over extension. If the IRB has an extraordinary range as compared to the Average True Range of the last 10 bars before it then the break back through the IRB is far more likely to fail. This will more likely result in an entry that has a higher likelihood of reversion to the mean as much of the energy and profit opportunity has potentially dissipated leaving the trader with a much smaller profit or perhaps a stop loss. Trail your entries to reduce the risks of reversion to the mean while still giving a trade a chance to push into your intended direction. Use proven trend qualification tool like Rob Hoffmanrsquos. In the absence of a well-tested tool of your own, trade in the direction of an approximately 45 degree angled 20 EMA. This strategy has very diverse applications across many markets and asset classes. For instance, in addition to trading conventional equities, futures, options and FOREX instruments, traders can consider using this strategy to analyze underlying equities and then trade high delta, in the money options plays as an example for active options day traders. So very diverse indeed. What we have shown you here is a simple, award winning strategy that you can take away and explore here today. Rob Hoffman has used this tool to help him secure wins in many of his 19 domestic and international trading competition wins. It is an excellent tool used for identifying where retail traders are misjudging the markets movement. It shows where one or more institutions is temporarily breaking away from the trend due to short-term inventory acquisition or liquidation. Once that inventory need is exhausted the overall market is free to resume the existing trend offering new opportunities for retail traders to trade back in the direction with the overall trend. To learn even more about Rob Hoffman and his award-winning strategy, WATCH THIS IN-DEPTH VIDEO HERE Rob Hoffman is the president and CEO of Become A Better Trader, Inc. and BecomeABetterTrader. Expertise: STRATEGIES Rob Hoffman is 19-time domestic and international trading champion trader who has won more live, real-money only, domestic and international trading competitions than any other trader in the entire world. Rob is also an internationally recognized professional trader, frequent speaker for top brokerage firms and financial exchanges, skilled educator and passionate mentor to proprietary traders, portfolio managers, and hedge fund managers from around the world. My Favorite Day Trading Technique My Favorite Day Trading Strategy By Geoffrey A. Smith, DTItrader When it comes to day trading, you have to be able to make quick decisions. Over the years I have learned that many stocks have their largest moves in first 30 minutes of the US day market. In particular, the NASDAQ stocks move more than most. Knowing this, I started looking at the NASDAQ 100 futures (NQ) to see if it moved like the equities. It did. It took time, but I finally figured out how to take advantage of the move in the NQ in the first 30 minutes. Because many people have computers and listen to the news in the morning, they open their trading platforms or websites and place orders to exit or enter new trades before they go to work. Once the Ding, Ding, Ding, on the New York Stock Exchange at 08:30am CT is heard, all these orders get filled. The problem is that we do not know which direction the market is going to move, so we have to give the market a little bit of time to quotwashquot these trade out of the market. Once they are gone, the market will then begin to push in one direction (up or down does not matter). This push will last about 15 minutes, and then the market will correct that move going into the top of the hour at 09:00am CT. The question is, how much time do you give the market to shake out the initial trades I have found that it is somewhere in the 3 to 7 minute range. The big thing is to see how it is trading off the open. Let39s take a minute and discuss the open. Most look at the close. I always wondered why. At the close you already know who won or lost, and I39ve never bought a tick to a football game to get there at the end. In fact, have you ever been able to start the race at the end Me either. So I do everything based off the open. If the market is trading above open, bulls are in control, and if below open, bears are in control. So as we look at this trade, I start looking at how the NQ is trading off the 08:30am CT open. Is it higher or lower than open during the 3-7 minute time period If it is holding above open, I look to go long, if trading below open during this time, I look to go short. Sounds simple huh In Chart 1 below is a 1 minute chart of the NQ futures (when we are done you might consider using a 5 minute chart, but we will get to that). The little blue bar is the opening minute at 08:30am CT. The yellow line is the open of that bar, which is also the open of the US markets on the NQ futures. Notice, once it opened, it never traded below open. If the first 5 minutes, it stayed above open. So, if you take the range in the first 5 minutes and wait until the market breaks out of the range, you would have gotten long. Look at the push it made. The NQ went from 4662 to 4681. The NQ is worth 20 per point (it trades it 0.25 increments, or 5 per tick). So on one contract you would have made 19 points or 380 on that move. Notice the little correction starting about 08:50am CT. This is very common and will spook many traders thinking that the market has fizzled out and the run is over, however, it is usually just taking a breather before continuing on after 09:00am CT. In Chart 2 below is another look at another day. This is a little tougher to trade, but look what it did. It opened and stayed below open in the first 5 minutes. Though it bounced up a little, it never got back above open, which argues that staying short was the right thing to do. ( Foot note . now you are thinking, so I have to risk above the open (or below the open if long), and I would say quotcorrectquot. In this trade, your protective stop needs to be on the other side of the open, and really about a point off the highlow since 08:30am CT.) Once it broke out of the first 5 minute range, I got you short, took some heat, but it paid nicely, moving from 4698 to 4692 for a 120 profit per contract. Interestingly, on both trades you could have left your stop on the other side of the opening 5 minute range and stayed in until lunch and been paid much better. I like to trade this with multiple contracts. I will take 1 off at 2 points profit, and another off at 4 points profit and let the last one ride. What I39m trying to do is finance my stop. If I can make 6 point on the first 2 contracts, that means that I can get stopped out and still make money or lose very little if the market reverses. Another thing, we will have economic news at 09:00am CT often. Knowing this, it can help your trade or it will stop you out. So before the news, I would tighten up the stop just in case. Now, back to the 5 minute chart mentioned earlier. Yes, you can use one. Since we are looking at the first 5 minutes, then why not use a 5 minute chart. I can39t disagree. I don39t use charts much when making this trade, but will use a 30 minute chart if I do look at one. I watch my trading platform, or DOM (depth of market), and quotdevelop the chartquot in my head. I39m a tape reader. I watch prices. Not to say I don39t like chart, because I do, I just use daily and weekly charts for bigger trends and use no smaller than a 30 minute chart if looking intraday. That is just me, and maybe not you. So, use a 1 minute or 5 minute chart if it helps. Finally, you can use this on stocks. The NASDAQ stocks do much of the same thing in the first 30 minutes. Watch GOOG or AMZN and see what they do. You can even use the options on those stocks. Just beware of the bid and ask in the first 5 minutes, because they can be quite wide, so use limit order to enter the options. Watch it for a couple of day and get the hang of it. It is kind of an quotartsyquot trade, but it will pay well over time. You will lose a couple every now and then, but that is part of trading. And it will not set up every day. There are some days that the NQ goes above open, then below open, then back above open, and you start wondering what you should do. Do nothing and let the market figure it out, but not with your money. There will always be another day to trade. Trade to win, and good luck trading Watch this trade discussed in further detail, SIMPLY CLICK HERE FOR THE VIDEO Register for this free, special event and get DTIs Trade of The Year During the class you will see DTIs top experts picks for 2017 and much more SIMPLY CLICK HERE TO RESERVE YOUR SEAT Geoffrey Smith teaches Level 1, 2, and 3 core curriculum classes, regular educator and instructor on the 24-hour Educational TradeRoom, GPS Coaching, and one of Tom Busbys first students. An active trader and investor for 25 years, Geof focuses in futures, equities and option trading including trading commodity option futures. Geof took an instrumental role in developing the DTI Method. The Platinum Experience core level classes took first place in SFO Magazine and Trader Planets STAR awards in the best trading courses category. Before coming to DTI, Geof was a pipeline engineer working in Oklahoma and Texas. The Rubber Band Reversal Strategy If you have been trading for any length of time, you have probably noticed that the markets are moving sideways A LOT. Consolidation is a huge part of the marketrsquos balance, and so it makes sense to learn strategies that take advantage of the sidewaysconsolidating type of market conditions. Often, ranging strategies are high probability but they do not offer a good Risk to Reward. But today, you will learn a strategy that has both a high win rate and the opportunity for some good R:R. The entire strategy can be boiled down into just a few steps. If you read the report carefully, you should be able to begin implementing the strategy virtually right away. Though, as always, I do recommend trying new strategies on a demo account and getting comfortable with them before trading them live. With that said, letrsquos dive into the steps. Step 1 - Identify RangeshyBound Markets on Daily or 4 Hour Charts A ranging market is simple to identify. We are looking for clearly defined sideways movement that is sustained with several tops and bottoms. One thing to remember is that a sideways market should have similar priced tops and bottoms. They do not have to be identical for us to consider it a range, but if the back and forth movement doesnrsquot have a consistency to it, itrsquos very difficult to take advantage of. You can see in situations, demonstrated by the green example, that a more consistent top and bottom will improve the chances that the market reacts at the expected time so that is what we are looking for. The red example shows you a sideways market that is not in a cleary defined range. So while the price is certainly going back and forth, the market is less responsive to a clear top or bottom range that we can utilize. The truth is that once yoursquove mastered this strategy you can still use it on less predictable ranges, but I recommend beginning with the more clearly defined ranges until you see some success. Here are a few examples of real ranging market conditions: In the second example, I used a 20 and 50 EMA to show you how moving averages can also signal a ranging market as they quickly begin to flatten and intertwine with one another. This is, of course, a lagging indicator but for those of you who like indicator confirmations, moving averages are an easy way to confirm a ranging market. Once you find a ranging market, you can move on to the next step. Step 2 - Identify an Overextension Within a Dead Market In this step, we are looking for the market to extend itself within a sideways market. More often than not, extended steep moves will pull back to settle toward reasonable prices, but this is even more true when the market is in a defined range. When it begins to accelerate and get overbought or oversold we are very likely to see it ldquosnap backrdquo like a rubber band once it runs out of orders to fulfill. Itrsquos this ldquoSnaprdquo that we are eventually looking to take advantage of within the Rubber Band Reversal, but first we must define the stretch point of the band. As always, I like to use multiple time frames to get a complete, accurate view of the market, so once we have a ranging 4 hour or Daily market condition, wersquoll zoom into a 60 minute chart to find an overshyextended point within the market. On the 60 minute chart, wersquoll add a Bollinger Band (standard settings) and RSI (standard). The Bollinger Bands and RSI give us a double confirmation to find overshyextended conditions. Bollinger Bands are a great indicator for this because they shrink down and quickly define a range which, in turn, makes it obvious when the market is stretching out of that range. When you combine the defined ranges with stretched Bollinger Bands, you get a pretty good idea of when price might make a turn around. But we also like to use the RSI to make sure that price is clearly overbought or oversold. The vertical lines represent when the RSI is above 65 or below 35. Please Note: The RSI is NOT an entry signal. It simply helps our patience and discipline as we are forced to confirm an overbought or oversold condition before going to the next step. The Bollinger Band and RSI are what allows us to be certain that the market has stretched like a Rubber Band and is ready for a potential snap back in the opposite direction. Now we know that the market is in position for our Rubber Band Reversal, but we do not have the ability to enter the trade yet. This is where a LOT of traders get tripped up. They see the RSI shoot over 65 or 70 and they are too trigger happy they just begin shorting the market. The problem is that more often than not, when the market hits 65 or 70 it is still in a momentum phase and we simply donrsquot know how long that momentum will last. We do not know how far the rubber band is going to stretch. So itrsquos very important to utilize the next steps in the strategy to make sure you have a complete plan and are jumping into trades early. We wait for the price to pierce the upper Bollinger band and simultaneously, we want RSI levels to be above 65 levels. After both conditions are met (Bollinger Band pierced and RSI overboughtoversold) we can go Step 3 - Find an Entry To find a high probability entry, we look for a unique combination I have used for a long time. The combination is a 15 Minute Reversal Candlestick (pin bar, inside bar, engulfing, etc.) at a whole number. Whole numbers are important because of their psychological value. A maximum number of orders are placed closer to the 50 or 100 levels, for example, at the 1.3050 or 1.3100 levels. In this shorter time frame, we consider anything ending in a 0 (for 4 digits) or 00 (for digits) to be a whole number. The key is that almost every time the market shows rejection around a whole number, we get SOME follow through. Often, it is only a few pips but when you combine it with the right market conditions like we are doing in this strategy, your odds of catching a reversal that moves 20, 30, 50 or even 100 pips is very, very high. Many times, price pushes slightly above the whole numbers and then quickly reverses, sucking in amateur longs, who get trapped and are forced to cover, thereby aggravating the fall. On other occasions, the institutional orders push price right at the whole number or even a few pips before.Either way, if you are prepared with a plan to trade around these whole numbers, you can take advantage of these scenarios. Once we see a 15 minute candle show rejection at a whole number, we are ready to place our entry. Here you can see a real trade example of the market spiking through to the tops, piercing the band, above 65 on RSI and getting our 15 Minute rejection candle right at 1.4340. With our criteria met, we can go ahead and set up the trade. Step 4 - Execution, Stop Loss and Take Profit With a market order, we will enter as soon as the 15 Minute candle closes (advanced traders can zoom into a 5 minute and anticipate the reversal momentum to improve R:R) For this particular strategy, our Stop Loss and Take Profit are very easy. Once the entry is made, we can place the Stop Loss a few pips above the entry candle or previous candle (whichever has a higher high) and we can place our Take Profit at the midshyband of the Bollinger Bands. The midpoint of the BB will change as the trade progresses but it should remain at the price of the midpoint at the time of the entry candle. So the full trade setup would look like this: Here, you have an ENTRY (green line) right as the candle closes, a TARGET (blue line) at the midpoint of the BB bands at the time of the entry candle and a STOP LOSS (red line) a few pips above the high of the piercing candle. In this case, the entry candle is relatively long given the high piercing wick so our RiskReward is about 1:1 (still not bad for a range trading strategy). But as yoursquoll see with practice many entry candles are smaller and the R:R can be 2:1 or even 3:1 in some cases. Plus, once you become a Rubber Band Reversal Expert, you can zoom in even closer to a 5 minute chart and get ahead of the momentum. Often, once the rejection of the whole number begins to happen, price falls quickly and waiting for the 15 Minute to close can cost you a fair amount of pips. So I like to get in early when I see that rejection taking place. Either way, it is a great strategy for ranging markets and I hope you take advantage of it Summary Points to Remember: Look for a rangeshybound market on the Daily charts and 4 Hour Charts. Once you have chosen your currency pair, select the 60shyminute time frame and overlay. Wait till the price pierces the upper Bollinger band and RSI is above 65 or below 35. Zoom into the 15 Minute chart to find our entry. On the 15shyminute chart, we want two important conditions to be fulfilled. We want a reversal bar We want to enter the trade close to a whole number The profit objective is at the midpoint of the Bollinger band, where we take our profits. With those few steps you can take advantage of the very common consolidating markets we see. If you have any questions about trading the strategy, you can email me at Jcrawfordlearntotradeforprofit I do ask that you try to be as specific and clear with any questions as I get lots of emails Grab TWO additional free strategy reports at no cost At Learn to Trade for Profit, we have one goal and its pretty easy to guess- we want to help traders and investors of all levels, all walks of life, all types of goals and motivations, anywhere in the world, aspiring to trade any market Learn to Trade FOR PROFIT. We dont sell anything, we just offer the best training and education at no cost. Using Precision Indicators To Day Trade On The Right Side Of The Market Force By Mohan Wolfe, BoomerangDayTrader All traders know that one of the key difficulties in any kind of trading (and especially day trading) is to get the initial positioning of the entry correct in order to keep the fluctuating price away from our stop. Greetings traders, my name is Mohan and in this special report I will show you the sure fire way to make your day trading more profitable and more peaceful with less grind. I have been working with futures traders since 2001 and have trained well over 50,000 traders through our variety of precision trading services. We specialize in working with traders who are suffering from trading losses or who are stuck in ldquobreak even syndromerdquo and really want to succeed. So letrsquos start with the first lesson in day tradinghellip be sure to ALWAYS USE STOPS Please donrsquot day trade without a stop, as this can cause tremendous damage to an account. You cannot always rely on your own judgementemotions to get you out of the trade that is on the wrong side of the market. We often tend to rationalize how when on the wrong side of a trade we ldquoknow the trade will still be good but just needs a little more wiggle roomrdquo. So the key to this is to position your trade on the right side of the market force. And as the trade progresses to assure yourself that you stay on the right side of the Market Force or to be able to determine if that MF has changed in any way. POPULAR INDICATORS USED FOR READING MARKET FORCE The most popular indicators over the years have been developed by brilliant market technicians that have stood the test of time. The Relative Strength Indicator also commonly known as RSI developed by Welles Wilder, Stochastics by Dr. George Lane, and MACD by Gerald Appel. There is such a wide variety of indicators available and so many great technicians whose names I wish I could mention in this short article. However, many of these modern day indicators are just slight variations of these original technical studies. Some newer indicators are combinations of these studies such as running an MACD on a stochastic etc. Below is a one minute chart of one of my favorite day trading contractshellip.The Mini Nasdaq (symbol: NQ) with the above indicators applied to it. Notice on the chart above that although we are applying some of the best and most popular indicator studies there is no crystal clear discernable area to get long or short in the market. And if you didhellip where would you place your stop How do you determine which direction the Market Force is on using these common indicators on this one minute chart So the most important element of day trading is to be able to determine what the primary Market Force is at the time you are getting ready to trade. Mohanrsquos Market Force precision indicators to the rescuehellip Over my 26 years of day trading I have studied practically every indicator that is out there in the industry. I have carefully studied and applied hundreds of them to my charts to determine which ones were the best. Well, after doing this type of research for quite some time and becoming somewhat disappointed (which I am sure you can relate to) I developed my own set of indicators which are extremely accurate. I call these indicators my ldquoMarket Force Indicatorsrdquo and they are part of my world famous trading system called Boomerang Day Trader. Now take a look at the chart below with the exact same day and time period of the chart shown above with the Boomerang Day Trader Indicators applied using a 450 tick chart. Notice the crystal clear identification of the Market Force with the bias coloring of the candles, the Trading Channels (shaded area) which identify the price direction of the Market Force, the matching colored Dynamic Trend Bands, and the 3 Market Force Indicators on the bottom of the chart all with matching color according to the Market Force direction of the pricebias. The first yellow dot after the Arrow which signals the opening of the Trade Channel in that direction is a crystal clear Sell Signal entry. On the buy side the first Blue Dot is the Buy entry after the arrow opening up the Buy channel with the Dynamic Trend Bands and all the indicator colors matching. Both were winning trades, there was little or no pressure on the trade entry and you were able to put some money in your pocket. The Boomerang indicators have been tried and tested under ALL market conditions and have produced millions of dollars in winning trades from our large international group of Boomerang users. In fact, the rise of Boomerang Day Trader to being one of the top, best -selling day trading software in the industry is due to the extreme accuracy of the market force indicators which I developed. You can see that by having the best indicators and knowing how to use them with a proven system can make trading a lot easier and more profitable. This is my 1 day trading technique and practically the only one I usehellip.Trading into the prevailing current Market Force This trading concept is fairly simple in principle with the steps as follows: Determine from your indicators what the primary Market Force is in the market right now Discover the best way to get into that Market Force and join that side of the micro trend (or larger scale move if that is determined by the indicators) Develop a stop method that will allow the trade some ldquowiggle roomrdquo to move sufficiently against your entry without creating too large of a loss or too tight of a stop which could take you out of a correct trade. To learn more about my Market Force Indicators you can watch a recent, brief video which was recorded in front of a large audience of Boomerang Day Trader users. In this video I describe how to use the Boomerang Day Trader ldquoMarket Force Indicatorsrdquo in great detail. We have bi-weekly training classes that you can attend for FREE if you wish by joining us at boomerangtrader You can sign up on the blog and get notices of when our next class will occur.In these classes I go over many vital elements for developing trading success which you really need to learn to stay in the game and be a career ldquoBlue Collar Working Traderrdquo. I just want you to succeed at futures trading if you have come this far and are struggling.Please consider us your resource for relief and a new vision for profitable trading like thousands of traders have. The methods that I describe above can also be used for higher volume active futures, stocks, ETFs and other instruments. If you think about it really it is just common sense.In other words, find the primary force that is underlying the market and place your trades on the side of that force. Sometimes traders will call this a ldquoTrendrdquo or intraday trend which is another name for a continuation movement. However, the important distinction between the ldquotrendrdquo and the ldquoMarket Forcerdquo is that a trend is what happens AFTER the Market Force shifts FIRST. When a trend appears to be in place the market force will often shift right at the top or bottom of the so called trend and stop all those who didnrsquot see it coming.This was because their indicators did not alert them accurately to this shift. This creates a big reversal against the ldquotrendrdquo surprising all those trend followers who did not understand how to read the intraday Market Force correctly. That is why having the correct precision indicators and proven trading method of how to use them is so important. VALUABLE TRADING RESOURCES FOR YOU TO SUCCEED AS A DAY TRADER I have many other resources for you to learn how to day trade on the correct side of the Market Force and I hope you will take advantage of my many years of experience. You can access a FREE REPORT on other elements of market force in the US stock markets called ldquoHow to read the stock market like a bookrdquo I have two different services that I offer to traders. First is my highly popular Boomerang Day Trader software which Guarantees 90 winning trade signals to come from the software following our exact methodrules. boomerangtrader No trading software has ever guaranteed 90 winning trades before in the history of the trading industry except for Boomerang Day Trader. We are the first, and we have raised the bar very high on trading systems. This shows our extreme confidence in the trading method and indicators we use. My other service is called the ldquoDay Traders Action live trading roomrdquo which trades a variety of instruments including futures, stocks, ETFs and occasion directional options. We primarily trade mini Nasdaq (NQ) futures during the first 2 hours of trading (sometimes a bit longer) using 5 different trading setups that I have developed over the years.Our goal each day is to make 500-1000 on a small trading account within that early period of the session. Note: the DTA live trading room is NOT a Boomerang training room. We have our bi-weekly classes for Boomerang and market training. We have been fortunate to have very excellent success on our stock and ETF picks with all winners since we started that service. Examples are: 65 gain in emerging markets in 2 months, a 230 gain in 2 weeks on Chesapeake Oil at the bottom of the recent oil drop, long crude oil at 30 area,long gold from 1080 and still holding for higher prices, long the bio tech industry and solid picks for getting 6-9 income on your capital with low riskhellipand much, much more. In addition to this I make an exact, crystal clear directional bias call for the market almost each trading day.This is extremely valuable for day traders and those trying to manage a larger portfolio like many of our subscribers do. I want to thank you for reading my brief article today. If you have any questions on any aspect of trading the futures market I will be glad to assist you in any way possible as I have been doing for traders now for over 16 years in the industry. I have made a long career out of assisting traders and would look forward to your email if there is any way I can assist you whether you get involved with our services or not.Here is my email: Mohandaytradersaction Thank you for reading my article on ldquoTrading with the Market Forcerdquo. As a special offer to readers I will be offering you a 20 discount on my top selling Boomerang Day Trader software with a 90 guaranteed profitable signals coming from the software. The regular price is 1195 but with this special link you can purchase Boomerang and all the indicators discussed on the video for just 995 today. Mohan is a 26 year trading veteran and trading coach for over 14 years in the industry. He is also the developer of Boomerang Day Trader, which is one of the top selling day trading software on NinjaTrader. Boomerang is also the first day trading software to offer a 90 guaranteed winning trade signals, creating an historical precedent in the industry. Chapter 07 Day Trading and Algorithmic Trading in Futures By Carley Garner, DeCarleyTrading Whether you like them or hate them, day traders and algorithmic system traders, commonly referred to as algos, are here to stay. Both groups of traders bring additional liquidity to the marketplace, which is a positive. However, some would argue that the baggage they bring with them isnt worth the additional liquidity. It is no secret that highly day traded markets such as the e-mini SP experience additional volatility throughout the last hour of the trading session as day traders square their positions. In addition, it is difficult to deny that algo traders havent created a marketplace that sees severely abnormal prices at a relatively higher frequency. Nevertheless, the new challenges posed by aggressive day traders and high-frequency traders via computer algorithms arent all that different from the obstacles faced by traders during the heyday of open outcry trading the antagonists are simply wearing a different mask. DAY TRADING IN FUTURES During my time as a commodity broker, Irsquove noticed the strategy bringing the most traders to the futures markets is day trading. The appeal of the strategy is the prospect of hypercharged trading profits, but it also comes with low barriers to entry, a lack of overnight position risk and, letrsquos face it, it is exciting. Traders generally use the same technical indicators and oscillators for day trading as they would position trading, so if you have a winning strategy, why wait weeks for the outcome Instead, traders can determine whether they have what it takes to make money within a single trading day. Most people assume day trading only entails trades that span the traditional opening and closing times of the official e-mini SampP 500 futures day session, which is 8:30 a.m. through 3:15 p.m. Central. But that isnrsquot necessarily true day trading is the practice of entering and exiting futures positions within a single trading session. In todayrsquos nearly 24-hour world of futures trading, a day trade might actually be held overnight. The distinction can be found in when the position was initiated, and whether it was still open at the close of trade. Most of the financial futures markets open in the afternoon prior to the official day session and trade through the end of the day session. As a result, it is possible to hold a day trade nearly 23 hours per day. If a trader is flat at the close of a trading session, anything done during that particular session is considered a day trade. Of course, there are some things to be aware of. Not all brokerage firms allow their clients to trade overnight those that do might levy a small fee for holding their position. Further, many brokerages offer day traders discounted margin rates. These margin discounts are frequently only granted during the exchangersquos official day session (8:30 a.m. Central to 3:15 p.m. Central). On a side note, my brokerage service (DeCarley Trading) is more liberal than most, since we grant day trading margins around the clock. Some brokers go so far as to force liquidate accounts at the close of each day if the client doesnrsquot have enough money to meet the exchangersquos state initial margin requirement. Not being aware of the rules and characteristics of a brokerage is a mistake capable of destroying an otherwise attractive day trading strategy. Brokersrsquo efforts to reduce the risk of day traders isnrsquot because they donrsquot want their clients partaking in the strategy. In fact, it is the opposite. Day traders tend to execute a high quantity of trades, which pads the pockets of brokerage firms. After all, the more a client trades, the more commission he pays to the broker. Accordingly, brokerage firms work hard to promote day trading via discounted margin rates and lower commission for the highest-volume day traders. They also encourage automated trading systems, which are inclined to be high-volume trading strategies. Further, risk managers at brokerage firms love the idea of their clients being flat overnight. As you can imagine, this takes much of the stress away from monitoring their client positions throughout the night. Donrsquot forget, futures trade nearly 24 hours per day you might be resting on the couch or fast asleep, but that doesnrsquot mean the markets are. Global events and sentiment sway asset prices in real time without any regard to what traders in the US might be doing at the time. Likewise, US traders buy and sell futures contracts throughout their day session without thinking twice about the Europeans, who are slumbering. I39ve been a commodity broker since early 2004 and have had the privilege of having a front row seat to the game of retail trading. Based on my observations, day trading is one of the most difficult strategies to employ successfully. Yet with difficulty comes potential reward for those capable of managing emotions and willing to put the time in to pay their dues. Traders able to uncover a way to make consistent profits might discover the reward is not only lucrative but also extremely convenient. They have the ability to sleep well at night and literally choose their own trading schedule. There is an unlimited number of strategies that day traders might opt to apply, so discussing that aspect in a single chapter is unrealistic. Any market approach deliberated in Chapter 6, ldquoPosition Trading in Futures,rdquo and market analysis techniques debated in Chapter 2 with respect to technical analysis can be applied to a day trading strategy. But over the years Irsquove noticed a few factors that play a big part in determining day trading success and failure. Hopefully, you will walk away from this section with a better understanding of risks, rewards, and reality. Common mistakes made by day traders Day traders face modest barriers to entry, but they also face the worst odds for success. However, much of the dismal performance by day traders can be mitigated by avoiding a few common mistakes. Unfortunately, many of the items on this list are easier said than done because, for many, they contradict some of the advantages of day trading luring them into the markets in the first place. Failing to take these steps shifts the odds of success away from the trader and toward his competition, the trading public. As a reminder, margin requirements for intraday trading are set by the brokerage firm, not by the exchange. As previously mentioned, because brokers generate revenue based on volume commission, they have incentive to entice traders to participate in day trading strategies with low margin rates. It isnrsquot uncommon for brokerage firms to advertise day trading rates for the stock indices such as the e-mini SampP 500, the e-mini Dow, and even the mini Russell 2000 for as little as 300 on deposit as a good faith deposit. So assuming his broker was granting him a 300 day trading margin, a trader with 3,000 in a futures account could buy or sell 10 stock index futures contracts at a time, as long as his intention is to exit by the close of trade. To green traders, this sounds like a fabulous proposition, but to those with experience it is a clear death sentence to a trading account. With that said, in the wake of financial crisis volatility, day trading margins have increased. It is still possible to find 500 day trading margin rates for stock indices, but most brokerages have increased it to 1,000 or above. This might appear to be a disadvantage and may frustrate a few traders, but the reality is a far more reasonable amount of leverage. In addition, it is still more than enough leverage to produce large profits and losses in a trading account. To put a 500 day trading margin into perspective, we know each point in the e-mini SampP 500 is worth 50, so with the e-mini SampP valued at 2,000 a single futures contract represents 100,000 (2,000 x 50) worth of the underlying SampP 500. It is easy to see how a trader buying or selling an e-mini SampP contract worth 100,000 with as little as 500 on deposit could get into trouble. If yoursquove done the math, in such a circumstance the trader is putting up a mere 0.5 of the contract value to partake in the profits and losses produced. This type of leverage doesnt give traders an advantage it gives them an incredible burden and a dismally low probability of success. Adding salt to the wounds of overleveraged day traders, many discount brokerage firms offering low margins are quick to liquidate client positions should their account equity dip (even slightly) below the stated day trading margin rate. This too adds to the likelihood of failure. A trader with 5,000 in a futures account being granted 500 day trading margins could buy or sell as many as 10 futures contracts to enter a position. However, if the market goes against the trade, even slightly, the brokerage will often liquidate the position. Each firm has slightly different risk rules, but most begin to take action if the trader has less than 400 per contract. Simply put, if the e-mini SP moves adversely by 2.00 points, the trade might be force liquidated. Even worse, brokers often charge a liquidation fee of 25 to 50 per contract. Anyone who has traded the e-mini SP before will tell you that 2.00 points are nothing more than random ebb and flow. Without the help of luck, a traders entry price will have to endure more than a 2.00-point drawdown before moving in the desired direction. Day traders using this much leverage rarely survive the trade long enough to see profits. To review: a trader starting with 5,000 and going long 10 e-mini SP futures, as would be allowed by a 500 day trading margin, could see his position offset by the risk managers of his brokerage firm once the loss reached 1,000 ((2.00 x 50) x 10) or 2.00 points in the e-mini SP. Further, the losses would be exacerbated by a forced-liquidation fee levied by the broker in an amount as high as 500. This trader would have lost 30 of his account in a matter of minutes on nothing more than quiet market flow. It should be clear by now that day trading futures in high quantities relative to account size or on a shoestring budget is equivalent to playing craps in Las Vegas. Traders can increase their odds of success by mitigating leverage through sufficient account funding, or at least trading minimal quantities. As a rule, it is a good idea to trade a single stock index futures contract per 10,000 on deposit in a trading account. Aside from the leverage factor, lightly capitalized accounts might not have the means to hold positions overnight when necessary. This does traders a massive injustice because it prevents their trading strategy from adequately giving each entry signal the time necessary to work out. Stock index futures might close at 3:15 p.m. Central, but that doesnrsquot mean your technical setup has had a chance to play itself out. For instance, a trading strategy could conceivably trigger a sell signal an hour before the close, but the restricted time frame might not allow for the anticipated price change to materialize. Thus, it might be crucial to hold positions into the overnight session, or even the next trading day, to give your strategy a fair chance to succeed. Trading sessions might be on timers but markets and technical indicators are not. If a trader is forced out of a trade at the close of the day session, it is possible he is forgoing the success of the trading signal. Most trading strategies struggle to turn profits on 50 of trades if you are limiting the performance of each signal to the day session, it is possible the winloss ratio will be greatly reduced. Sometimes, to their own detriment, those drawn to day trading tend to have hyperactive personalities, and this often has a negative impact on their trading results. Rather than exercising patience, many day traders force trades out of boredom, or they rush their trading signals. The best traders are able to develop the discipline necessary to delay entry into the market until their trading strategy returns a verified signal. Further, trading on a whim or a gut feeling in the absence of a true trading signal according to the set parameters is generally a horrible idea. This is because the venture is likely a low-probability prospect to begin with, but because a trade was entered on something less than a detailed strategy, there probably isnrsquot a sound exit strategy either. Further, it is doubtful the trader will be able to keep detrimental emotions under wraps on balance, if the trade is entered based on emotion not logic, the psychological stress is higher. Poor decision making breeds more poor decision making. If you find yourself in the midst of a string of bad decisions, it doesnrsquot mean you are an inept trader. It simply means you are human even the most experienced traders will have cold spells. What differentiates the successful from the unsuccessful is the reaction to hard times in the market. Traders who are overactive and trade without justification from a defined set of rules not only face potential peril from market losses, but they end up with a hefty commission bill that eats away at their trading account. I often find myself in conversations with traders who assume if they enter a position, and the market fails to move in the desired direction right away, they will just get out. Similarly, beginning day traders frequently express their desire to cut their losses by exiting a trade if it goes against them by a few ticks. Although the desire for risk management is admirable, the result is relatively predictable. This type of trading activity might not create large losses on each individual trade, but over time the transaction costs and small losses produced by the strategy can be substantial. Day traders using overly tight leashes to manage the risk of their trades will soon find small losses eventually leading to a big loss because the market will rarely move in the desired direction without some sort of adverse price move. A day trader cutting losses on a trade after a few contrary ticks faces a very low probability of catching a move in the desired direction. Brokerage firms love this type of trader. Not only do they pose little risk to the firm, they often pay a substantial amount of their account toward transaction costs. To prevent overtrading, most traders must adjust the way they think about the market and the day trading opportunities it presents. Green traders look at being flat the market (being without a position) as a missed opportunity. But traders should see it in the opposite light. Those on the sidelines are not losing money, nor are they at risk of losing money. In addition, they are in a much better position to take advantage of a promising opportunity should it come along. Traders often grow bored with a quiet market and execute a small trade to lessen the pain of watching paint dry. The problem with this is that quiet markets have a tendency to become abruptly volatile without any advance notice. Perhaps there is a new announcement or simply a large group of stop orders triggered to force prices outside of the narrow band of trading. In any case, a sudden change in volatility can be a painful lesson but also pose significant opportunities for those on the sidelines. Using stop orders Listing stop-loss orders as a common mistake that day traders make probably has readersrsquo minds reeling. The majority of trading books, courses, and forums teach traders to always use stop orders. In fact, if yoursquove ever trolled any of the popular social media trading groups, yoursquove probably noticed a daily meme regarding the perils of not placing stop-loss orders. When dealing with leveraged futures contracts and theoretically open-ended risk, you may find it preferable to protect a trading account from catastrophic losses. However, stop-loss orders might not be the best way to accomplish this task. In fact, in my opinion, the use of stops often increases the odds of trading failure. Anybody who has experienced their stop order being filled just before the market reverses understands the emotional turmoil it can cause, not to mention the financial ding to a trading account. Not only was that particular trade a failure but it can have a negative effect on trader psychology going forward, so it could affect future trades as well. The assumption regarding premature stop-loss triggers is that ldquosomeonerdquo could see the tradersrsquo stop order and went for it. The truth is, unless a trader is executing hundreds of contracts at a time, there wouldnrsquot be any incentive for a trader with pockets deep enough to be capable of taking advantage of a temporary stop running price spike to pay attention to the order, let alone take action. Most retail traders arenrsquot swinging enough size to get onto the radars of the ldquobig fishrdquo in the market. Thus, if a stop order is filled just before the market reverses to a favorable direction, the trader isnrsquot a victim he simply placed the stop-loss order at an inopportune place. Unfortunately, this occurs frequently. Ironically, the very order intended to protect traders from large losses can easily become the source of the large losses. In the end, several highly certain small losses will eventually add up to crippling amounts. We will debate the use of stop-loss orders and offer alternative risk management techniques further in Chapter 16. Once again, futures brokerage firms offer cheap and easy leverage. Unfortunately, novice traders often assume 500 day trading margin for the e-mini SP is a reasonable amount of leverage. In my opinion, utilizing the maximum leverage offered is a horrible idea, inevitably leading to massive losses. Traders are far better off trading with less leverage than is available to them. Yet, I would venture to say that most day traders execute quantities in excess of what is ideal based on available trading capital. Brokerage firms are partly to blame for overleveraged futures day traders, but in the end, it is the traderrsquos choice whether to use it. It is easy for traders to get sucked into the mindset that the more contracts traded, the more money made. They rationalize, ldquoIf the trade setup is a good one, and the belief is the market will move in the desired direction, why not trade as many contracts as possiblerdquo Regardless of the strategy, the trader never knows which ventures will be winners and which will be losers until after the fact. Even the best trade setups can go awry. Actually, sometimes trades that look the best on paper are the trades that fail to work. On the other hand, trades that comply with the signals but not the traderrsquos ldquogut feelingrdquo often work out the best. Accordingly, a strategy of loading up on risk on any particular trade is a poor one. The more contracts traded in a single outing exponentially reduces much needed room for error. In this game, it is important to have some breathing room no trading method is perfect. In addition to the mathematical disadvantage of lower-success probabilities at the hands of being overleveraged, trading a high number of contracts adds to the emotional turmoil a trader will experience. The avoidance of aggressive position sizing is key to keeping harmful emotions in check such as fear and greed. If you are holding 20 contracts in a 10,000 account it would take a mere ten-point move in the e-mini SampP to blow out your trading account. Further, it would only take a five-point move to lose 50. If yoursquove followed the e-mini SampP intraday, you know that it can move five points in the blink of an eye. One might argue trading such size leaves the door open to double an account on a single trade. This is true, but the odds are highly against it. Even the most sophisticated and experienced traders require room for error in their trading. How many contracts you trade at a time should be based on personal risk tolerance and available capital. However, I recommend traders initiate a position with a one-lot of a mini stock index futures contract per 10,000, or most other commodities (gold, crude oil, the grains, currencies). Of course, you can easily day trade ten or more times this amount with the given account size, but just because you can doesn39t mean you should. Sound boring Look at it this way: an average profit of 50 per day equates to 1,000 per month and 12,000 per year. Assuming you were skilled enough to do this and started with a 10,000 account, you would have more than doubled your money in a year. It doesn39t take 10 lots of any commodity futures contract to make 50 per day, but trading 10 lots dramatically increases your odds of depleting an account. To illustrate, a trader going long 10 e-mini SampP 500 futures stands to lose 10 of his trading capital for each point the contract goes against him. In a market that generally sees 10.00- to 15.00-point ranges on any given day, it would be relatively easy to cause detrimental harm to a trading account by executing too many contracts. Failure to average price Most people will tell you not to add to your losers. Nevertheless, for those with well-capitalized accounts, I believe adding to a position as a means of adjusting your breakeven point makes sense because it increases the odds of obtaining a better average entry price. Traders who follow the previous guideline of keeping position sizing reasonable to avoid the stress and risk that comes with overleveraging have the ability to price average. Price averaging for day traders is similar to the act of scale trading for a position trader. The premise is to nibble on futures contracts incrementally rather than buying or selling the entire desired position in a single transaction. If the plan is to go long crude oil with as many as five futures contracts, a day trader might start with a single contract and enter limit orders to buy the other four contracts at lower prices, perhaps 20 to 40 cents lower. In some scenarios, doing so will prevent the trader from getting all of the contracts filled, but it will also avoid being filled on all five in a declining market at what later turns out to have been an inopportune entry price. Once the trade is deeply underwater, emotions flare, leading to ill-advised trading decisions. Averaging the entry price will almost always lead to a more achievable breakeven point, and thus, less stress. Yet the practice of price averaging is something you should treat with care. It doesn39t mean you should buy another crude oil futures contract each 20 cents it drops against you without any other considerations. However, if the price of oil falls substantially beneath your initial entry, perhaps that is something to consider. Naturally, it would be wise to peel contracts off at various prices should the market turn in your favor. If you scale into a trade, it is often best to scale out of it, too. Day trading time frames Day trading is a broad term that can be used to describe a nearly unlimited number of strategies. It is conceivable that the most important decision a day trader makes when developing a trading plan is which time frame to use to chart the futures marketmdashwill the technical rules be applied to a chart using one-minute price bars, 60-minute price bars, or something in between There are even some day trading platforms and charting software packages that offer traders the ability to chart futures contracts using line charts produced by plotting data points for each and every trade executed on the exchange independent of time. Others have the ability to chart price intraday using 90-minute price bars a 90-minute chart would produce a price bar each hour and a half. Each of these examples rely on extremes, but most traders work with something in the 10- to 30-minute range. With that said, I prefer to look at a 60-minute chart. In my opinion, a 60-minute futures chart provides day traders with a ldquobigger picturerdquo view of price action, which can help prevent being lured into the market on noise, rather than a valid trading signal. The exact time frame a trader chooses should reflect his personality and risk tolerance. The shorter the time frame used, the more active the strategy will be and the higher the frequency of false signals. Conversely, longer time frames tend to experience less activity, fewer false signals, and less deceptive price moves. Yet, most technical trading strategies applied to charts with longer price bars will come with higher risks relative to a shorter bar. This is because those playing with stop-loss orders will be required to place stops deeper when using a 60-minute chart than they might with a 10-minute chart. Accordingly, there is a tendency for traders utilizing 10-minute price bars to trade larger quantities than those using 60-minute price bars. This is because the profit and loss potential per trade is generally smaller using a 10-minute trading trigger. In my opinion, day traders are better served trading less consequently, using 60-minute bars help to tame the trader. Figure 1: Beware of signals produced by technical oscillators in early morning trade following a tame overnight session. They are generally unreliable. Most assume all technical indicators will work similarly among various time frames and during all times of the trading day, but that isnrsquot the case. Technical oscillators are least reliable in the early morning hours (Figure 42) this is because they are being calculated based on what is often tight range trading in the overnight session. As a result, it is common to see indicators created to identify overbought and oversold market conditions produce false countertrend trading signals. Even worse, during this time of day, the indicator can easily reach highly saturated levels, giving traders a false sense of reliability. Oscillator inaccuracy doesnrsquot have to be early in the morning it can happen at any time. It is far more common when using short time frames. This is because the price data used to calculate each five- or 10-minute price bar isnrsquot necessarily a representative sample of the overall trend. Some traders think such charts will provide information that the 30- or 60-minute chart wonrsquot display for quite some time, but the overactive nature of short time frames encourages overtrading, breeds stress, and often massive losses. The use of a five-minute chart, relative to a 60-minute chart, will undoubtedly result in a higher number of day trading signals (Figure 43). However, the goal of any trading strategy should be to locate and execute quality trades focusing on quantity is a common misstep. Because shorter time frames disguise market noise as something significant, traders will likely fall victim to a large number of false signals. Even if the trader manages to keep losses on these high-frequency trades in check, excessive trading volume can quickly result in an expensive commission bill regardless of how low the trader has managed to negotiate his trading fees. The bottom line is, the traderrsquos behavior plays a much bigger part in controlling transaction costs than the actual commission rate paid to his broker. We will discuss the reality of commission in Chapter 15, ldquoUnderstanding the Implications of Trading Cost Decisions.rdquo Figure 2: A five-minute chart offers day traders a higher number of trading opportunities, but the quality of the signals produced suffer relative to a longer time frame chart, such as the 30- or 60-minute. Using charts based on short time frames, such as the five-minute chart, requires traders to place tighter stop-losses and therefore increases the odds of being stopped out of the trade prematurely. Nevertheless, because five-minute charts are so quick to generate signals, it is paramount that the trader keeps risk in check. This is because in low-volatility markets, the five-minute chart might generate a buy signal for countertrend swing traders with a mere 3.00-point decline in the e-mini SampP. However, we all know the SampP 500 is capable of moving 15 to 20 points in a minute or two. Thus, reacting to a shallow dip because the five-minute chart calls for it could put the trader into a massive losing position should he be in the wrong place at the wrong time. On the other hand, a swing trader acting on signals produced by a 60-minute chart might not receive a countertrend trading signal unless the SampP drops 15 to 20 points. Such a trader is still facing substantial risk, but on most days the SampP doesnrsquot fall more than that. Accordingly, the odds of getting stuck with a massive loser can be mitigated. Stop-loss orders or weekly options In Chapter 16, on deliberating risk management, we will debate the use of stop-loss orders and long options to protect futures positions from losses. It is worth mentioning in a discussion of day trading because the difference between success and failure is largely dependent on where, and how, stop-losses are used or not used. Despite widespread chatter suggesting that one should never trade without stops, it might be the sole reason most traders lose money. Whether traders place stops too tight or too loose, stop-loss orders elected prior to favorable market movement is a common occurrence that can devastate trading accounts as well as trader psychology. Nothing hurts more than losing money on a trade despite being right about the market direction. Day traders operating on the premise of quality over quantity by utilizing 60-minute charts, or perhaps even 30-minute charts, are generally aiming at higher profit targets than someone initiating positions based on five- or 10-minute charts. As a result, it might be worth their while to skip the practice of using stop orders and instead purchase cheap protection via weekly e-mini SampP options or e-mini NASDAQ options. If you are unfamiliar with weekly options, they are those listed by the futures exchange that expire on a weekly basis rather than a monthly basis, which has traditionally been the norm. There are also weekly options on some commodities such as the grains and crude oil, but most day traders are applying their efforts to the stock indices due to favorable liquidity. Those trading markets that donrsquot offer weekly options might look to the traditional monthly options if they happen to be expiring soon (two weeks or less). If it is possible to get a reasonably close-to-the-money weekly expiring call option in the e-mini SampP for less than 500, it might be worth the cash outlay to protect a short futures position for the day while protecting the trade from losses without the risk of premature stopout. This approach might not make sense for those traders utilizing extremely short time frames with small profit targets. Obviously, if a trading signal provided by the five-minute chart calls for a long position with a profit objective of three points, it doesnrsquot make sense to spend five or six points to protect it. Again, we will tackle this issue in more detail later on, but I wanted to introduce the idea here because it is relatively unconventional, despite being potentially helpful to a day trading strategy. Believe it or not, in many instances and environments and when using options for protection isnrsquot feasible, I believe not using a stop order at all is preferable. Stop-loss orders have the ability to cause more harm than good to countless traders. Scalping futures contracts Those who scalp futures contracts are seeking to profit from small market moves that seem inconsequential to most trading strategies. Scalpers believe because a market never sits still, they can profit from the ebb and flow that occurs as each market participant buys or sells a futures contract. In many cases, scalpers are targeting a mere tick or two in price movement. This is equivalent to different dollar values in each commodity market but is generally somewhere around 10. A scalp that nets one tick would provide a 10 profit to the trader before considering transaction costs, while a two-tick winner would generate 20 in gain. However, unlike position traders or even day traders using longer time horizons, who find transaction costs to have little impact on their bottom line, a scalper could easily pay 30 to 50 of his profits to transaction costs. Suddenly, the 10 per tick in profit per contract is cut in half. Because of the relatively low-profit potential per trade, scalpers are playing a volume game. They are rarely trading one or two contracts at a time. In order to make a scalping strategy worthwhile, it is necessary to trade high quantities of contracts in a clip. As you can imagine, this strategy is a dream come true for those benefiting from the trading costs of a scalping account. Contrary to what most would believe, the futures exchange itself reaps most of the rewards from the transaction costs paid by scalpers because exchange fees are constant regardless of how much commission is paid to the broker. Yet the broker often accepts a scalping account at a discounted commission rate to help better the clientrsquos odds of making money. As a result, the broker often makes pennies per trade even the most active scalpers donrsquot pad the pockets of his broker as much as he thinks he is. Instead, he is probably paying anywhere from 2 to 4 per trade to the exchange. So if you are a scalper and the CME reports better than expected earnings, you should know you played a part in that. Most scalping strategies involve attempting to buy the ask and sell the bid in any particular futures market. This goes against the norm. A trader placing an order to buy a futures contract at market price would receive a fill at the current ask price, if he placed an order to sell a futures contract at the market he would receive a fill at the current bid price. As covered in Chapter 1, the difference between these two prices is known as the bidask spread, and it is accepted as a normal cost of doing business in the commodity markets. Scalp traders must recognize the relatively hidden transaction cost of trading built into the bidask spread. A trader entering a futures contract at the market price is immediately sustaining a paper loss in the amount of the spread and the transaction costs. For simplicitys sake, lets assume a scalper is paying a total of 5 per round turn for commission and exchange fees, most of which goes directly to the exchange. By going long a crude oil futures contract, the trader is incurring a 5 transaction cost plus the spread between the bid and ask, which is generally a tick, or 10 in crude oil. Thus, upon entry, the trader is in the hole by one and a half ticks (15). To turn a net profit of a measly 5, the scalper must pick up two ticks in crude oil. This is easier said than done. To further illustrate, to make 50 the trader would need to execute 10 contracts and offset the scalp at a one-tick profit in addition to overcoming the one-tick hidden cost of the bidask spread. On the other hand, if the trader loses two ticks in the market, the total loss on 10 contracts is a quick and painful 250 ((20 5) x 10) From a purely mathematical standpoint, it is difficult to justify a scalping strategy. Yet some traders with quick fingers or computer programming prowess swear by it. A scalper thinks he can find a way to collect the bidask spread rather than pay it, as all other market participants do. To do this, he might place a limit order to sell a contract at the ask and buy at the bid to profit from market ebb and flow. Predicting the ability to do so often stems from judging the working limit orders of other market participants via a depth of market (DOM) panel. If you are unfamiliar with a DOM panel, it is a price ladder displayed within most futures trading platforms offering its users a glimpse into the currently working limit orders in a particular market. For instance, it will display the best 10 bids (working buy limit orders) and the best 10 asks (working sell limit orders). Accordingly, traders can see which prices within immediate reach of the market might have the most buying or selling interest. An often-overlooked drawback of DOM panels is they donrsquot display stop orders placed by market participants, and they donrsquot account for market orders. This makes sense, because a market order is filled immediately. Nonetheless, market orders are done by the most motivated buyers and sellers and often have the biggest impact on price. In general, if there are more sell limit orders working than buy limit orders, the scalper assumes he will be able to buy the bid as those seller orders are filled and prices are temporarily depressed. Likewise, if a trader spots a market with more buy limit orders immediately under the market, he might believe he can sell the ask as those orders are filled and prices are temporarily boosted. Some scalpers take the opposite approach. They believe if the DOM panel is displaying more sellers than buyers, they will be able to sell a contract and buy it back a tick or two later after the sell orders are filled and prices have fallen accordingly. Similarly, if the DOM panel suggests more buyers at prices near or a tick below the market price, a scalper might go long in hopes the filled orders will cause prices to tick higher. Once again, you can see there is more than one way of looking at market conditions and signals, and there are even more strategies attempting to exploit them. One again, there isnrsquot a proper or improper way to trade. The only judge is the bottom line of a trading account statement. It is also worth noting that, although these two approaches to scalping involve a vastly different thought process, both methods could work. We cannot deny that even in directionless markets, prices tick up and down as time goes on. This is all scalpers need to potentially profit. Scalping is a much more refined skill than it appears to be on the surface. Due to extremely high transaction costs and relatively aggressive position sizing, scalpers can make or lose a substantial amount of money quickly. If your preference is to employ a conservative trading strategy, look elsewhere. Despite low monetary risk per contract for most scalping strategies, the price action in such a narrow time frame is largely random, and high transaction costs are a difficult burden to overcome. In addition, the practice of scalping in the traditional sense requires more nimble fingers than the average trader likely has. In todayrsquos world of super computers, most scalping strategies have been developed into automated, or algorithmic, trading systems. This is an excerpt from Chapter 7 of Higher Probability Commodity Trading written by Carley Garner and published by DeCarley Trading, an imprint of Wyatt-MacKenzie Publishing. There is a substantial risk of loss in trading futures and options. It is not suitable for everyone Sign up for a free trial of our futures trading newsletters by clicking here. Carley Garner is an experienced commodity broker with DeCarley Trading, a division of Zaner, in Las Vegas, Nevada. She is also the author of ldquoHigher Probability Commodity Tradingrdquo, ldquoA Trader39s First Book on Commoditiesquot, quotCurrency Trading in the FOREX and Futures Marketsquot, and ldquoCommodity Optionsrdquo, she also writes a monthly column for Stocks amp Commodities Magazine. After graduating from UNLV as a Magna Cum Laude, Carley jumped into the options and futures industry with both feet in early 2004 and quickly became one of the most recognized names in the business. Her commodity market analysis is often referenced on Jim Cramerrsquos Mad Money on CNBC, and she is a regular contributor to TheStreet and its Real Money Pro service. Taking Advantage of Falling Fear Trading From the Gut: Is it a Good Thing Kenneth Reid, Ph.D. DayTradingPsychology Greetings traders, Irsquom a day trader and trading coach with a Ph.D. in Clinical Psychology. This e-book is about trading techniques, a quintessential topic because without a solid technical method, traders will absolutely drive ourselves crazy. The topic Irsquod like to discuss is trading intuitively, or ldquoTrading from the Gut.rdquo Humans have two brains and one of them (the right hemisphere) is highly intuitive. Naturally, traders wonder how best to incorporate intuition into trading, becausehellip itrsquos always there offering an opinion. And because there39s nothing methodical about intuition (itrsquos totally subjective and discretionary) it often creates a nagging inner conflict with a more objective (technical) perspective. DONrsquoT DRIVE YOURSELF CRAZY Discretionary trading is psychologically the most challenging work experience you are likely to ever have, unless you are in the military. Because it will feel like your own mind is working against youhellip which is what crazy people feel. Itrsquos like having Mad Money inside your head. Part of your brain is yelling ldquobuy, buy, buyrdquo and another part is shouting ldquosell, sell, sellrsquo Fortunately, this inner argument can be mitigated if the traderrsquos technical method is 1) well understood and 2) suits the traderrsquos own personality. So before we address the intuitive side of trading, letrsquos take a short detour and look at these two pre-qualifications. The personality analysis will then lead directly into a discussion of gut-based trading. For onersquos method to be ldquowell-understoodrdquo it has to be built by the trader from the ground up, or at least extensively tested. This is the only way to have sufficient confidence to endure drawdowns without feeling compelled to re-design the method. If you are constantly changing your method, i.e. searching for the Holy Grail, you wonrsquot get anywhere at all. Markets do evolve, of course, but if your method has a positive expectancy, change it as infrequently as possible. Generally, sticking with one method that you have absolutely mastered is better than trying to develop a different method for every market mood. Findingdeveloping a method that ldquosuits your personalityrdquo is also essential. However, most traders have no idea what their trader personality might be. I use my own 5-Type model, which is easy to understand. Letrsquos look at two opposite personality types, the Warrior and the Engineer. Trader personality fundamentally influences how you define risk and reward. A Warrior personality, such as found in most Chicago-trained traders, is generally risk-seeking and much less methodical than an Engineer personality, which is likely to be risk averse and very disciplined. The Warrior trader is usually comfortable doing things like buying or selling extremes and adding to a losing position (they call it ldquoscaling inrdquo), while the Engineer would consider that behavior sloppy and reckless. In a nutshell, the Engineer relies on ldquobrains,rdquo whereas the Warrior relies on a different part of his male anatomy. Warriors will often use market orders to enter in a general area of interest, usually at an extreme, and many are contrarians, who look to play reversals. Engineers, on the other hand, tend to feel more comfortable using limit orders for a satisfyingly precise entry after the Warriors have taken their positions, and then might look for trend continuation. Of course not all Warriors are countertrend traders and not all Engineers are trend followers, but I would argue that most Warriors are risk seekers and most Engineers are risk-averse. Bottom line: Your personality is already influencing your trading because it determines how you define opportunity, risk and reward. According to my research, trader personality is a combination of 5 different styles, and the best traders are not overly expressive of one single type. Rather, they are integrated hybrids and that hybridization process happens slowly, as traders mature. In the end, Warriors must become more methodical and Engineers must become more comfortable with risk in order for each to fulfill their trader potential. To find out more about trader personality you can take a free AWAREcopy personality profile on my website daytradingpsychology WHAT ABOUT TRADING FROM THE GUT Herersquos the segue into the topic of intuitionhellip. your personality determines to what degree you are attracted to intuitive trading. Warrior traders trade from the gut all the time. Itrsquos naturally their dominant style. They think with their gut and act from their gut and their account balances usually fluctuate wildly. Fortunately, psychologists recently discovered that there is a brain in the gut, so Warriors do have a fighting chance. Their main challenge is keeping losses small because they are natural risk-seekers . And regardless of your personality type, the more intuitively you trade, the more carefully you need to manage losses, or they will get out of hand. ARE YOU TRADING RISK OR REWARD Nigel Hawkes, a very experienced Warrior trader and friend, is fond of saying that ldquoI donrsquot trade price, I trade risk.rdquo They seek out risk because they know, in their gut, that without risk there is no chance of reward. They donrsquot shy away from risk, they embrace it and get charged up from it. Without a steady supply of risk, Warriors get bored and feel useless. But for the average non-Warrior trader . risk is not their friend. The average trader tries to avoid risk because for them, risk loss. (Their ideal fantasy is a market without risk.) Their thinking goes like this: ldquoWhy think about possibly losing when the goal is to win Wouldnrsquot that be negative and self-defeatingrdquo This naiumlve assumption is why most traders start out trading Reward, not risk. In analyzing a potential trade, they only think about how much they could make. But if you have not planned and prepared to lose, trading Reward sets you up for shock and disappointment when the market suddenly moves against you. Every loss is then a small trauma for the blindsided Reward trader. And in that panicked emotional state, you are likely to make mistakes, which will result in some of those small unrealized losses suddenly becoming large realized ones. That creates the standard boombust pattern for Reward traders. They are lucky if they can stay at breakeven. Whatrsquos the alternative Trader development is largely about integrating complementary personality qualities (hybridization, as noted above) and making the shift from trading Reward to trading Risk. In my own trading, this means using my professional trading to read price action psychologically. I trade futures and I try to determine where the Reward-driven Traders are likely to stop themselves out. The principle is simple: if you are trading in a minefield, you donrsquot want to be on point. I prefer to wait until a group of Reward Traders suddenly change their minds and now believe that they have made a mistake. This motivates them to liquidate their positions at a discount. And thatrsquos where I like to enter. HOW TO MAKE THE MINDSHIFT If you want to make the transition from trading Reward to trading Risk, the following material might be useful for you. Below is a summary of a video I produced on Trading from the Gut and a link to the downloadable video file, which is just 5 minutes long. By the way, the video is not just informational, if you use headphones itrsquos an experiential lesson that might actually help you change this habit if you listen to it every day for a week or two. (And therersquos a link if you want to get one of these videos every week.) TRADING FROM THE GUT Looking at a cold chart, trading looks seductively easy. Hindsight is a beautiful thing. The lure of hindsight is that we imagine that somehow we could have or should have known what was going to happen at pivot Xhellip or pivot Y. We like to imagine that we could have taken advantage of the big drop or the big rally. Itrsquos particularly pleasurable to imagine this because when the thought of a beautiful winning trade flashes through our mind, even in fantasy, the brain generates a jolt of the neurotransmitter dopamine. Dopamine is mentally energizing and motivating. It fuels the primitive hunter in us who constantly stalks the big trade. Unfortunately, dopamine is also addictivehellip itrsquos the active compound in cocaine. Curiously, more dopamine is generated by the thought of potential reward than by the actual reward. This is what kept those hungry hunters going for days and it motivates traders to dream big and be over-focused on reward (dinner). If you are chronically low on dopamine (which has a genetic cause) one of the best ways to raise it is to imagine great trades. Each imaginativeintuitive foray into a positive future generates a shot of pleasure and hope, just like a rat pressing a lever. THE DREAMER vs. THE REALIST Therersquos no harm in dreaming. The harm comes when we act on the fantasyhellip with real money. (Strike One.) And then use our factual knowledge to justify the imagined scenario. (Strike Two). And then fail to recognizeadmit when we are wrong. (Strike Three) Itrsquos amazing how utterly convinced we can become about the profit potential of our own fantasies. Of course, casino operators rely on this all too human quirk to keep customers playing as long as possible. But in trading, the trader is the casinohellip the player, the dealer and the pit boss. In other words, therersquos no objective supervision. I used to work in addiction recovery centers. Itrsquos tough to motivate an addict to quit while they still have money to buy drugs and itrsquos just as tough to get a compulsively hope-ium-smoking trader to stop dreaming while heshe still has capital. Once we take action on a fantasy, we become so psychologically invested in our imagined outcome (which constantly shoots dopamine into the brain circuits) that we will ignore all disconfirming information until reality pulls the needle out and slaps us hard upside the head. Unfortunately, intuitive traders rarely learn from their mistakes, which means they keep trying until they run out of funds. Indeed, trading intuitively from the gut is one of the fastest ways to blow up an account. Then I get the call: ldquoCan you help me Irsquove really screwed up.rdquo Therersquos a book entitled Trading from the Gut by one of the original Turtles, Curtis Faith, who did blow up several funds and eventually faced personal bankruptcy. Faith was a math and programming whiz when he was 19 years old, which is why he was selected by Richard Dennis, but he abandoned that skill later in life, went to the opposite extreme and has not yet come back to the middle. For his sake I hope he finds it. MISSING PIECES FOR INTUITIVE TRADERS Whatrsquos missing from gut-level trading Three things. First, an appreciation of the marketrsquos random nature (Read Mark Douglas or Talebrsquos Fooled by Randomness ). Intuitive trading is based on the fantasy that we now have or can have privileged information about the future. I call it mindreading the markethellip but the market doesnrsquot have a mindhellip.or a planhellip and it doesnrsquot know what itrsquos going to do next, so how could we know Just because the market leaves tracks and one can see patterns in the tracks, doesnrsquot mean those patterns could be predicted beforehand. Clouds make patterns, too. I see faces, you see animals, one person sees monsters, another sees angels. For survival purposes, our right brain is designed to identify patterns as quickly as possible. The tiny amygdala that controls fightflight reactions is the size of an almond and can recognize 20,000 faceshellip animals, monsters, angels. Just because you lsquosee itrsquo in your mindrsquos eye, doesnrsquot mean itrsquos really there. Second, risk analysis is lacking, because each intuitive idea feels like a sure thing. The inner gamblerrsquos justification story goes like this: ldquoWhy prepare for loss if I donrsquot expect to loserdquo Third, purely intuitive trading lacks any objective reference. Itrsquos all subjective, all the time. Most intuitive traders trade naked, i.e. without indicators, just levels. BOTTOM LINE If you have a tendency to manufacture intuitive ideas and then act on them without objective confirmation, itrsquos important to nip this tendency in the bud, as this is extremely high risk behavior. My short answer on how to incorporate intuition in onersquos trading goes like this: Trading is like driving. Driving is a discretionary and intuitive activity that gets you from Point A to Point B, but you first need to have a car and know (and obey) the rules of the road. The lsquocarrsquo and the 39rules of the road39 comprise your technical method, which must have a positive expectancy to be effective. Intuition can (and probably should) be used to enhance onersquos driving on the margins, but it is not an adequate substitute for a rule-based method. The video that accompanies this article includes some special affirmations that might help you change this behavior. They are embedded in a special neuroprogramming audio track that promotes whole brain learning. YOU CAN DOWNLOAD THAT FREE VIDEO BY CLICKING HERE You can sign up for more videos HERE Dr. Kenneth Reid is a seasoned trader, trading coach and educator with a Ph.D. in clinical psychology. Dr. Reid began stocks trading for his own account in 1996. In 2001 he was hired by a company in Connecticut as a model portfolio manager, newsletter editor and market strategist. He retired in 2012 to pursue his futures trading and coaching practice full time. Dr. Reid works with private traders, Registered Investment Advisors, as well as hedge fund and bank traders. His website is daytradingpsychology Chapter 10 10 Smart Reasons for Forming a Trading Entity Robert A. Green, CPA, GreenTraderTax Forming an entity can save active investors and business traders significant taxes. Active investors can limit wash sale losses calculated between their individual taxable investment accounts and IRAs with an entity account. Business traders solidify trader tax status (TTS), unlock employee-benefit deductions, gain flexibility with a Section 475 election and revocation and limit wash-sale losses with individual and IRA accounts. For many active traders, an entity solution generates tax savings in excess of entity formation and compliance costs. Active Traders Should Consider An Entity for Tax Savings An entity return consolidates your trading activity on a pass-through tax return (partnership Form 1065 or S-Corp 1120-S), making life easier for you, your accountant and the IRS. Itrsquos important to segregate investments from business trading when claiming TTS, and an entity is most useful in that regard. Itrsquos simple and inexpensive to set up and operate. Additionally, entities help traders elect Section 475 MTM (ordinary-loss treatment) later in the tax year mdash within 75 days of inception mdash if they missed the individual MTM election deadline on April 15. And itrsquos easier for an entity to exit TTS and revoke Section 475 MTM than it is for a sole proprietor. Itrsquos more convenient for a new entity to adopt Section 475 MTM internally from inception, as opposed to an existing taxpayer whom must file a Form 3115 after filing an external election with the IRS. Donrsquot worry, prior capital loss carryovers on the individual level are not lost they still carry over on your individual Schedule D. The new entity can pass through capital gains if you skip the Section 475 MTM election to use up those capital loss carryovers. After using up capital loss carryovers, your entity can elect Section 475 MTM in a subsequent tax year. Business traders often use an S-Corp trading company or an S-Corp or C-Corp management company to pay salary to the owner in connection with a retirement plan contribution, which otherwise isnrsquot possible in a partnership trading company (unless a trader has other sources of earned income or is a dealer member of a futures or options exchange). Trading in an entity can help constitute a performance record for traders looking to launch an investment-management business. Finally, many types of entities are useful for asset protection and business continuity. A separate legal entity gives the presumption of business purpose, but a trader entity still must achieve TTS. Avoid wash sales with an entity Active investors in securities are significantly impacted by permanent and deferred wash sale losses between IRA and individual taxable accounts. Trading in an entity helps avoid these problems. The entity is separate from your individual and IRA accounts for purposes of wash sales since the entity is a different taxpayer. An individual calculates wash sales among all their accounts. Ring fencing active trading into an entity account separates those trades from the individual wash sale loss calculations. The IRS is entitled to apply related party transaction rules (Section 267) if the entity purposely tries to avoid wash sales with the ownerrsquos individual accounts. In that case, the entity will not avoid wash sale loss treatment. If you donrsquot purposely avoid wash sales, you can break the chain on year-to-date wash sales in taxable individual accounts by switching over to an entity account mid-year or at year-end, and prevent further permanent wash-sale losses with IRAs. If the entity qualifies for TTS, it can consider a Section 475 MTM election exempting it from wash sales (on business positions, not investment positions) that also negates related party rules. Play it safe on related party transaction rules by avoiding the repurchase of substantially identical positions in the new entity after taking a loss in the individual accounts. Business traders: consider an entity Many active traders ramp up into qualification for TTS. They wind up filing an individual Schedule C (Profit or Loss from Business) as a sole proprietor business trader the first year. Thatrsquos fine. They deduct trading business expenses on Schedule C and report trading gains and losses on other tax forms. They can even elect Section 475 MTM by April 15 of a given tax year to use ordinary gain or loss treatment (recommended on securities only). But a Schedule C owner may not pay himself compensation and the Schedule C does not generate self-employment income, either of which is required to deduct health insurance premiums and retirement plan contributions from gross income. (The exception is a full-fledged dealermember of an options or futures exchange trading Section 1256 contracts on that exchange they have SEI per Section 1402i.) The business trader needs an entity for those employee-benefit plan deductions. Safeguard use of Section 475 Pass-through entities We recommend pass-through entities for traders. A pass-through entity means the entity is a tax filer, but itrsquos not a taxpayer. The owners are the taxpayers, most often on their individual tax returns. Consider marriage, state residence and state tax rules including minimum taxes, franchise taxes and more when setting up your entity. Report all entity trading gains, losses and expenses on the entity tax return and issue a Schedule K-1 to each owner for their respective share mdash on which income retains its character. For example, the entity can pass through capital gains to utilize individual capital loss carryovers. Or the entity can pass through Section 475 MTM ordinary losses to comprise an individual net operating loss (NOL) carryback for immediate refund. The best types of entities We like the S-Corp because it pays compensation (officerrsquos salary) to the owner, which efficiently unlocks health insurance premium and retirement plan contribution deductions. You can form a single-member LLC or multi-member (spousal) LLC and the LLC can elect S-Corp tax treatment within 75 days of inception or by March 15 of the following tax year. (Another option is to form a corporation and it can elect S-Corp tax treatment, too.) A general partnership can also elect S-Corp status in every state except Connecticut, the District of Columbia, Michigan, New Hampshire, New Jersey and Tennessee. But the S-Corp is not feasible alone in some states or cities, including California and New York City. In those places, we suggest a trading company partnership return mdash either a general partnership or LLC mdash and a management company S-Corp or C-Corp. You can convey interests in the pass-through entity to family revocable trusts or even irrevocable trusts. Year-end Entity planning There are important tax matters to execute with entities before year-end. For example, S-corps and C-corps should execute payroll before year-end. A Solo 401(k) defined contribution plan or defined benefit retirement plan must be established before year-end. Top 10 Tax Deductions for Active Traders Active traders qualifying for trader tax status (TTS) maximize these deductions in the following ways: Use the square footage or rooms method to allocate every expense of your home including mortgage interest, real estate taxes, rent, utilities, repairs and maintenance, insurance and depreciation. The IRS limits use of HO expenses by requiring business income to offset the deduction, except for the mortgage interest and real estate tax portion. Link the HO Form 8829 to TTS trading gains or transfer some to Schedule C to unlock the HO deduction. If you have trading losses, carry over unallowed HO deductions to subsequent tax year(s). Converting personal home expenses to business use is great. 2. Additions and improvements to office Consider an addition or improvements to your home office like building more space, replacing windows, walls, and flooring. Depreciate residential real property over 39 years on a straight-line basis. If you rent or own an outside office, depreciation rules are more attractive. The Protecting Americans From Tax Hikes (PATH) Act of 2015 created ldquoqualified improvement property.rdquo Itrsquos a new class of nonresidential real property, excluding additions like increasing square footage. Use 50 bonus depreciation on qualified improvement property placed in service in 2016. PATH extended bonus depreciation through 2019. 3. Tangible property expensing Expense new tangible property items up to 2,500 per item. Before 2015, the IRS threshold for capitalization with depreciation vs. full expensing was 500. When you purchase a new trading computer system its best to arrange separate invoices for each item not exceeding 2,500. 4. Section 179 (100) depreciation For equipment, furniture and fixtures above the tangible property threshold (2,500), use Section 179 depreciation allowing 100 depreciation expense in the first year. PATH made permanent generous Section 179 limits. The 2016 limit is 500,000 on new and used equipment including off-the-shelf computer software. The IRS limits the use of Section 179 depreciation by requiring income to offset the deduction. Look to business trading gains, other business income or wages, from either spouse, if filing joint. 5. Automated trading systems Increasingly, traders are writing computer code for developing automated trading systems. The IRS allows a few different choices for expensing ldquointernal-use software.rdquo If you qualify for TTS before incurring software development costs, deduct them like other research expenses in Section 174(a) in the year paid. If you donrsquot qualify for TTS before incurring software development costs, capitalize them under Section 174(b). Two choices: When you complete the software and qualify for TTS, amortize (expense) the intangible asset over 60 months. Or, wait until you place the software in service with qualification for TTS to amortize (expense) the intangible asset over 36 months. Traders may qualify for TTS using automated trading systems providing they write the code or have other significant involvement with creation and modification of the automated trading systems. Conversely, if a trader purchases an off-the-shelf automated trading system providing entry and exit signals and trade execution, the trader probably doesnrsquot get credit for the volume and frequency of trades made by the automated trading system. 6. Education, mentoring and seminars All three are considered education expenses and tax deductibility hinges on qualification for TTS. Education business expenses paid after the start of your business are allowed for maintaining and improving your business. Learning a new business before starting that business is not allowed as a business expense. If you are learning about investing while carrying on an investment activity, that education expense is not allowed as a Section 212 investment expense by Section 274(h)(7). Tip: If you pay for trading education services before qualifying for TTS, consider using Section 195 start-up expenditures treatment below. 7. Section 195 start-up expenditures Go back a reasonable period (six months) before qualifying for TTS to capitalize a reasonable amount (15,000) of start-up costs. Start-up expenses include costs to investigate and inquire about a new business. Costs capitalized in Section 195 would have to qualify as a business expense if paid after business commencement. Section 195 allows an expense allowance in the first year up to 5,000. Start a calendar year business late in the year and still get the full 5,000 expense allowance. Amortize the remainder of the costs over 180 months on a straight-line basis. If you exit the trading business, you may write off the unamortized balance. 8. Organization costs Under Section 248 for corporations and Section 709 for partnerships, treat expenses to organize or form an entity in a similar manner as Section 195 start-up expenditures. There is a separate first-year expense allowance up to 5,000, and the balance is amortizable over 180 months on a straight-line basis. 9. Health insurance premiums Deduct health insurance premiums from individual AGI if you have an S-Corp trading company paying you W-2 wages which include your premiums. The plan must be in association with your small business and not a third-party employer plan for you or your spouse. Deduct health insurance premiums during the entity period, not before. This S-Corp wage component for health insurance premiums is not subject to social security and Medicare taxes, so enjoy the income tax savings with no offsetting payroll tax costs. A C-Corp management company deducts health insurance premiums on the corporate tax return. 10. Retirement plans Most traders with TTS should consider a Solo 401(k) retirement plan. Consistently high-income traders with TTS should consider a defined benefit plan if they are close to age 50. Retail traders need an entity like an S-Corp trading company or C-Corp management company to arrange retirement plan deductions since sole proprietor traders donrsquot have earned income required for employee benefit plan deductions. With one exception: Futures traders using full exchange membership have self-employment income (Section 1402i). Solo 410(k) plan . S-Corp officer wages of 140,000 unlock the maximum 53,000 contributiondeduction or 59,000 if age 50 or older with the 6,000 catch-up provision. The 100-deductible elective deferral up to 18,000, or 24,000 with the catch-up provision, provides the greatest income tax savings vs. payroll tax costs. The 25-deductible profit-sharing plan up to 35,000 is good if you have sufficient cash flow to invest in tax-free compounded growth within the plan. Defined-benefit plan (DBP) . With consistent high trading income, arrange a 100,000 plus contributiondeduction with a defined-benefit plan. Work with an actuary on complex DBP calculations. Business traders have a wide variety of other expenses including independent contractors and employees for trade assistance and IT, market data providers, charting software, chat rooms and trading groups, subscriptions, books, periodicals, attorneys, accountants, tax advisors and more. Commissions are not expenses they are part of the trading capital gain or loss. Business expenses are deductible ldquoabove the linerdquo from gross income, whereas investment expenses face significant limitations ldquobelow the line.rdquo Section 212 investment expenses exclude home office, start-up expenditures, employee benefits and education. They are part of miscellaneous itemized deductions, which must first exceed a 2 of AGI threshold. Upper-income taxpayers face additional limitations: a Pease itemized deduction phase-out and AMT taxes since investment expenses are an AMT preference item. Learn how to qualify for TTS on GreenTraderTax Robert A. Green is a leading authority on trader tax, author of The Tax Guide for Traders (McGraw-Hill, 2004), Greenrsquos Trader Tax Guide . the ldquoBusiness of Tradingrdquo column for Active Trader magazine and blogger for Forbes. Mr. Green is frequently interviewed and has appeared in Barronrsquos, the New York Times, Wall Street Journal and Forbes. He has also appeared on CNBC, Bloomberg Television and Forbes Video Network. He is the main tax speaker at the MoneyShow University and Traders Expo, and he teaches trader tax for CCH and state CPA societies. As founder and CPACEO of Green amp Company Inc. Mr. Green develops and leads our tax strategies, including our trader tax niche. Mr. Green handles our content generation, speaking, writing, advocacy, marketing, business development, alliances, events and more. As Managing Member of Green, Neuschwander amp Manning, LLC our CPA firm, Robert Green is involved with tax strategies, tax treatment, opportunities, problems, client relations, reporting standards, working with tax attorneys and more. He handles many consultations with clients and entity formations using our outside attorneys. Mr. Green is also involved with tax controversy, including IRS and state exams, appeals and tax court. Mr. Green co-manages operations on the CPA firm, too. TABLE OF CONTENTS 8 Forex Life Hacks To Make You a Better Trader MY 1 DAY TRADING TECHNIQUE:THE HOFFMAN INVENTORY RETRACEMENT BAR (IRB) TRADE MY FAVORITE DAY TRADING TECHNIQUE MY FAVORITE DAY TRADING STRATEGY THE RUBBER BAND REVERSAL STRATEGY USING PRECISION INDICATORS TO DAY TRADE ON THE RIGHT SIDE OF THE MARKET FORCE DAY TRADING AND ALGORITHMIC TRADING IN FUTURES TAKING ADVANTAGE OF FALLING FEAR TRADING FROM THE GUT: IS IT A GOOD THING 10 SMART REASONS FOR FORMING A TRADING ENTITY Risk Disclaimer There is a very high degree of risk involved in trading. Past results are not indicative of future returns. ChartExperts and all individuals affiliated with this site assume no responsibilities for your trading and investment results. The indicators, strategies, columns, articles and all other features are for educational purposes only and should not be construed as investment advice. Information for futures trading observations are obtained from sources believed to be reliable, but we do not warrant its completeness or accuracy, or warrant any results from the use of the information. Your use of the trading observations is entirely at your own risk and it is your sole responsibility to evaluate the accuracy, completeness and usefulness of the information. By accessing this book your information may be shared with our educational partners. You must assess the risk of any trade with your broker and make your own independent decisions regarding any securities mentioned herein. Affiliates of ChartExperts may have a position or effect transactions in the securities described herein (or options thereon) andor otherwise employ trading strategies that may be consistent or inconsistent with the provided strategies. Copyright 2016 by Sir Isaac Publishing. 37 N Orange Ave STE 500 Orlando, FL 32801 chartexperts All rights reserved. Printed in the United States of America. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior written permission of Sir Isaac Publishing
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