Forex requires Patience

When the going gets tough, the tough get going. This adage often brings back the memories of my past days when I was trading initially in the currency exchange market. Indeed, there's nothing more hurtful than losing your invested money in the FX market. But, online currency trading is like life where you're got to learn from your wrong moves and keep moving on. Learning the basic skills of online forex trading could be easy but, practically, one needs to acquire the advanced skills to play safe through thick and thin of FX trading.

I have traded in forex for many years and, if you count on me, I must tell you that the secret of successful trading lies largely on the hunch and intuition of an trader. Technically expressed, you should have the accurate forex alerts and forex signals to be able to make the right moves in the currency market. However, this is easier said than done as the skills of the Currency Trading Signal takes a long time to master. This is why while a few people are able to boost their forex pips in a short span of time, the others take a long time to achieve the same or maybe, some of them get frustrated and just give it up! The reality is that not many people are ready to be entirely devoted to the perilous process of online forex trading.

Forex Swing Trading

When evaluating the forex market for swing trade opportunities the focus is placed on predicting directional changes or continuations for a given currency pair. For this we rely on technical analysis.

In technical analysis, just as in fundamental analysis, there are lagging indicators and leading indicators. One of the most reliable tools used to predict forex market swings is Elliott Wave analysis. Elliott Wave analysis can be used to identify trends and countertrends, trend continuation or exhaustion and to evaluate the potential price targets of a trend.

You can apply Elliott Wave analysis to both long and short position swing trade set ups for your currency pairs.

Elliott Wave theory is named after Ralph Nelson Elliott, who concluded that the markets moved in a repetitive pattern of waves. He attributed this action to the mass psychology of the market.

Elliott concluded that the market’s movement was a direct result of the mass psychology of the time and that the stock market is a fractal. A fractal is an object that is similar in shape, but at different scales. A great example of a fractal in nature is a stalk of broccoli. The stalk and the individual branches look exactly the same; just the branches are smaller in scale.

Fractals just happen to form in accordance with Fibonacci ratios. Is this a coincidence?

Elliott attributes this mass psychological move to the human trait of herding. Even though Elliott’s theories were based on stock market price movements, it has been applied to evaluating Presidential approval ratings and fashion trends changes as well.

The conclusion, the market price actions are not the cause of economic growth or slow down, but the reflection of the mass psychology of investors. If the mood of the investing public is upbeat then a bull market ensues. This is counter to what most individual perceive, that because there is a bull market the mood of the investing public is upbeat.

Elliott Wave patterns follow a sequence that the markets move up in a series of 3 waves and down in a series of 2 waves. This 3 wave impulse and 2 wave corrective sequence form the foundation of the 5 Wave impulse pattern (the opposite is true in a downtrend).

The Elliott Wave Counts are as follows;

Wave 1 - Short Covering
Wave 2 - Pullback from Short Covering
Wave 3 - Major Rally Phase
Wave 4 - Institution Pause in the Rally
Wave 5 - Retail Buying

Wave 1 is usually the weakest of the impulse waves. It is a brief rally based on short covering of the bears from a previous move down. When Wave 1 is complete, the currency pair sells off, creating Wave 2.

Wave 2 ends when the market fails to make new lows. You often see dominant reversals patterns form at the end of this wave signaling the being of the rally phase or Wave 3.

Wave 3 is the longest and strongest of the impulse waves. This signals strong currency buying or selling in the direction of the trend. This trend usually starts of slowly, but tends to accelerate as it breaks to new highs above the top of Wave 1.

Like any trend, especially a strong trend a correction will occur. Traders will begin to take profits and the currency pair will retrace. This signals the beginning of Wave 4.

Again the currency pair will rally ushering in the Wave 5 rally. Wave 5 is typically supported by the retail traders and not institutional buyers (the herd) and tends to lack the momentum generated in the Wave 3 rally. This creates divergence that can be easily measured on any technical oscillator. After the currency pair breaks to new highs above the previous Wave 3 high, the rally loses steam and changes trend.

This trend change can result in either a new 5 Wave impulse pattern or a corrective in nature.

Don’t Believe Everything that You Read

I just ran across an interesting article on the accuracy of personal finance writers in the Akron Beacon Journal of all places — gotta love Google News! The article correctly points out that personal finance books, news stories, etc. are often riddled with factual errors that might lead you to make bad money moves. How can you protect yourself? The article has several common sense suggestions.

First off, never assume that anything you read on a personal finance matter is the full story. Many personal finance issues are far too complex to be covered fully in a typical article or column. Second, consider the source, and decide whether you can trust their accuracy with regard to the topic at hand. Finally, don’t ever make a decision based solely on what you read in a personal finance article, as it might just be plain wrong.

This last point is actually good advice when it comes to virtually any single source of financial information. In fact, you can’t even trust the IRS Taxpayer Assistance Centers to give you the straight dope on tax matters, as a recent government study revealed that 20% of walk-in visitors get wrong answers to their queries.

Perhaps Reagan had it right: Trust, but verify.

10 Tips for Marketing Yourself and Your Business

If you are like most independent contractors and/or executives of small businesses, you spend sleepless nights worrying about how you will acquire customers and grow sales. Therefore, marketing your business effectively becomes a critical component to your overall success.

1.
Focus on Your Core Competencies Know your target market and the value your product or service will bring to them. Focus your sales and marketing efforts towards these groups. Avoid spending time trying to acquire customers you cannot properly serve.

2.
Develop a Clear and Concise Message Create a 30 to 60-second statement that clearly explains what you do, for whom, and why your target audience should buy from you. Have this message become your company's mission statement and raison d'être. Practice your message and notice how your target audience reacts to it.

3.
Create Collateral Materials Nothing says you are a viable business more than having a company logo, business cards, stationery, brochures, and possibly even a web site. Keep it all simple, and do not order more than a 3-6 month supply of printed materials. Once these pieces are in place, do not be shy about using them.

4.
Join Networking Groups Join or form one or two networking groups with individuals you do not know very well. Tell people what you do and who your target market is. Help others by connecting them with potential suppliers or employers. In time, they will return the favor to you.

5.
Network Every Day Networking is not limited to groups and networking meetings. Carry your business cards with you at all times and be prepared to talk about your company's mission statement at a moment's notice. Your next hot prospect might be standing behind you at the grocery store.

6.
Leverage Your Current Customers Happy customers are your best sales people -- ask them to provide testimonials and/or references for prospects. Consider establishing a customer referral program, and provide free/discounted services or a monetary reward for every customer that they recommend.

7.
Develop Alliance Partners Form strategic partnerships with others who sell a complimentary product or service to your target market. These alliances can be as simple as sharing contacts and leads, or they might take on a more formal structure. Either way, the goal is to broaden your reach beyond your own network.

8.
Become an Industry Leader People like to buy from subject matter experts. Therefore, look for opportunities to share your skills and talents by writing articles or lecturing on a topic within your area of expertise. Even teaching a night course at the local college or community level will give you additional exposure.

9.
Don't be Afraid to Try If you are serious about growth, spend time outside your comfort zone and try new things. Sometimes new ideas will work, and other times they won't. Either way, the process will teach you something new and valuable about yourself and your business.

10.
Brainstorm with Others You are in business for yourself, but that does not mean you need to have all the answers yourself. Whether you are a natural born marketer or one that sees marketing concepts as completely foreign, kick around ideas with others whose opinions and values you trust. You never know where your next “big idea” will come from.

These are just 10 tactical ways in which you can easily market yourself and your business. There are many more ideas that can work as well. Use these approaches as the building blocks to acquire customers and grow sales. However, for the best results, it is recommended that you incorporate your tactical initiatives into an overall marketing or business plan that acts as the compass/guidepost for your company's day-to-day activities.
For a FREE consultation on how to jump start your marketing plan, please contact http://www.engelmanmanagement.com/

US Dollar: What to Expect in December

US Dollar: What to Expect in December

We are entering the last trading month of the year which usually draws out a lot of unique factors that can affect the demand for US dollars. A few weeks ago, we published a report on the seasonality of the US dollar and we found that based on 20 years of data, the dollar has a greater tendency to fall in the month of December (see report). These risks are higher this year with problems in the financial sector still plaguing the US economy; we could see another month of volatility because options are expiring and traders across different markets are divided on what to expect from the Federal Reserve. The futures market is currently pricing in a 100 percent chance of a quarter point rate cut with 42 percent of that probability in favor of a half point cut; in other words the odds for 50bp over 25bp is quickly nearing fifty-fifty. The dollar however was stronger across the board today and the main reason for that is the expectation that the Fed will come to the market’s rescue. However over the medium term their rescue efforts should be dollar negative and regardless of what the Fed decides to do, half of the market will be surprised. For the US dollar and the currency market this means one thing and that is volatility. Fundamentally, Federal Reserve Chairman Ben Bernanke has set the tone for trading last night when he reiterated the cautionary comments made by Fed Vice Chairman Kohn earlier this week. Bernanke told the markets that the relapse of funding problems has tightened credit conditions significantly and he believes that consumer spending could be particularly vulnerable this month given higher energy prices and mortgage payments, a weak housing market, and unfavorable volatility in equities. Today’s US numbers were mixed. Personal income and personal spending growth declined but the PCE deflator and Chicago PMI accelerated. Ultimately the bad news outweighed the good which is why rate cut expectations continued to rise. The Middle East Council meeting begins on Monday read our special report on what this could entail for the US dollar.