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Forex Trading Strategies Reddit: What you need to know to start Forex trading.

Forex Trading Strategies Reddit: What you need to know to start Forex trading.

FOREX Strategies

What are FOREX Strategies?
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You may have noticed that most of people confuse the terminology and refer to FOREX Strategies in the wrong way. There are methodologies, systems, strategies, and techniques. The most effective methodology is Price Language (Trend Tracking). Combined with a correct reading of mass psychology presented by the charts.
We know that in the Stock Markets there are thousands of strategies. FOREX, like the rest of the markets, presents you with the opportunity to apply similar strategies to win consistently. Taking advantage of repetitive psychological patterns.
First, the Price Language methodology has created great fortunes in FOREX, and the next fortune may be yours. But this methodology must be implemented within a framework of advanced concepts of Markets. Without forgetting the basics. And working hard day by day.
Second, a strategy is a set of parameters and techniques that together give you the advantage to act in any situation. Thus for example in war, generals have attack strategies and counterattack strategies.
FOREX strategies alike are entry strategies and exit strategies. All beginners should know these FOREX strategies for beginners. That way you will get a general idea of ​​the game and understand that trading is a war against the Market and its Specialists. Only applying FOREX strategies revealed by the same Specialists and using their own techniques,
... you can survive in this war.
Do not fall into the trap of the many "systems" and "methods" that are offered on the internet about operating in the FOREX Market. They just don't work in the long run. They are strategies based on indicators for the most part. Using rigid parameters. That if they can work and give profitability during a certain period of time, they will always reach a breaking point when the market changes its dynamics.
Instead, take advantage of your precious time and learn the Language of Price or Price Action.
The Language methodology will allow you to adapt to each new phase of the Market. If you combine this knowledge with the appropriate psychological concepts, you can live comfortably from speculation in FOREX.

Forex Trading Strategies Reddit - Basic FOREX Strategies

You have two basic FOREX strategies, one entry, and one exit. Both follow a general strategy that helps you capitalize on the collective behaviors of the Market. That is, of the total of participating speculators.
This behavior causes the formation of cycles that repeat over and over again. Driven by the basic emotions (uncertainty, greed, and panic) of the speculators involved that can be taken advantage of with the aforementioned FOREX strategies. Specialists identify these emotions in the order flow and capitalize on these events every hour, every day, and every month.
Basic FOREX Strategies - The Price Cycle
These repetitive cycles consist of 4 phases:
  1. Accumulation
  2. Upward trend
  3. Distribution
  4. Downward trend
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The two trends can be easily identified by their notorious breakdown. And the two areas of uncertainty (accumulation and distribution), due to their notorious range trajectories.
This general behavior determines the core of our FOREX strategies.
You buy when the price of a pair has broken and has come out of one of its congestion formations (accumulation or distribution). You implement one of the Forex strategies, in this case, the entry one.
The multi-time technique will help you find the point of least risk when entering your initial buy or sell order. In the same way and using the same strategy but this time to close your position, the multiple timing technique will also show you how to close your operation obtaining the highest possible profit.
The most consistent way to extract profits in the market is by trading the start of trends within a cycle . Once confirmed by their respective breaks from the areas of uncertainty. This is the mother of all FOREX strategies . And in a market that operates 24 hours, we have more frequent cycles and therefore more opportunities.

Forex Trading Strategies Reddit - Advanced Forex Strategies

There are many advanced FOREX strategies that are generally used by professional speculators working for large financial firms.
Among these firms are banks, Investment Fund managers and Hedge Fund managers. The latter is an investment modality similar to Investment Funds, with the difference that Hedge Funds use more complex investment strategies. Its operations are more oriented to aggressive speculations in the short and medium-term.
Among the most common strategies is hedging (hedging), carry trade, automated systems based on quantum mathematics. And a large number of combinations between the different option strategies.

The Carry Trade

The central idea of ​​Carry Trade is to buy a pair in which the base currency has a considerably higher interest rate than the quoted currency. To earn the difference in rates regardless of whether the price of the pair rises or falls.
Suppose we buy a $ 100,000 lot of AUDJPY, which according to the rates on the chart would turn out to be the ideal instrument in this example to use the Forex carry trade strategy.
As our capital is in US dollars we have to assume for our example, the following quotes necessary to perform the place calculations:
AUD / JPY = 80.00 USD / JPY = 85.00
What happens internally in your broker is this.
  1. By placing as collateral $ 1,000 of your $ 50,000 of capital (assumed for this example), deposited in your account, you have access to $ 100,000 virtual (this is what is known as leverage); that is, you put in $ 1,000 and your broker lends you 99,000.
  2. With those $ 100,000 virtual dollars, your broker borrows on your behalf ¥ 8,500,000 Japanese yen (85 × 100,000) at 0.1% annual interest from a Japanese bank.
  3. With those ¥ 8,500,000 Japanese yen, your broker buys A $ 106,250 Australian dollars (8,500,000 / 80) and deposits it in an Australian bank where it receives 4.5% annual interest on your behalf.
  4. One year later (and regardless of the profit or loss generated by the pair's movement), your profit will be the difference between the AUD rate and the JPY rate, that is:
Profit = (AUD rate) - (JPY rate) - (costs of the 2 currency exchanges) Profit = (4.5%) - (0.1%) - (0.1% to 1%)
The great advantage of carry trade FOREX strategies is that this percentage profit is applied to the $ 100,000 of the standard lot; the broker transfers all of the profit to you, even if you only contributed $ 1,000. On the other hand, if you carry out the inverse of this operation, this benefit of the Forex carry trade becomes a cost (swap), and you assume it completely.
Remember that FOREX carry trade strategies are recommended for pairs with considerable interest rate differences, such as the one we have just seen in our example.
These FOREX strategies should also not be used in isolation. The idea is that through technical analysis you identify when would be the ideal time to enter the market using your carry trade Forex strategy and multiply your profits considerably.

What FOREX Strategies Do Hedge Funds Use?

The FOREX strategies used by large fund managers do not constitute an advantage in terms of percentage results for them, nor do they constitute a competitive disadvantage for you.
The vast majority of them fail because of their big egos. In fact, there was a firm made up of great financial geniuses, including 2 winners of the Nobel Prize in Economics, who developed a strategy based on quantum mathematical calculations.
With an initial base capital of about 3 billion dollars, and after 3 successful years obtaining annual returns of over 40%, the firm Long-Term Capital Management, begins its fourth year with losses. To counteract these losses the geniuses decide to multiply the initial capital several times, while the losses continued.
The year closed with the bankruptcy of the fund, and with a total accumulated loss of 1 trillion dollars, due to the great leverage used. And all for not admitting that the FOREX Strategies of Long Term Capital Management were not in line with the dynamics of the Market.
There are an overwhelming number of opportunities in the stock markets to make money interpreting the Language of Price.
You don't need to use complex "advanced" strategies that have been created to handle hundreds or billions of dollars.
The reasons for using these FOREX strategies are very different from what a "retail trader" pursues with his small speculation business.
As you can see, you should not worry about wanting to integrate any of these advanced strategies into your arsenal. They are only beneficial for managing hundreds or billions of dollars, where the return parameters are very different when you handle small amounts of capital.
Do not worry about collecting hundreds of free FOREX strategies that circulate on the internet, that great accumulation of mediocre information will only serve to confuse you and waste your valuable time.
Spend that time learning Price Action,
… And you will always be one step behind the Specialists, identifying each new Market condition, and anticipating the vast majority of reversals of all prices.
Ironically, the most successful fund managers indicate that their most profitable trades are those based on the basic trend-following strategies of the Price Language. The same ones that you will learn in this Free Course.
Dedicate yourself to perfecting them and believe me you won't need anything else. As long as you have good risk management, taking into consideration the following points ...

Styles of Investments in FOREX

The Investment FOREX long term is not recommended for small investors like you and me. If we take into account the term investing literally as large investors do who buy a financial product today to sell it years later.
We both have a better niche in the short and medium-term.
You may have noticed that the big multi-year trends in the Forex Market do exist. But minor swings within a big trend are usually very wide.
These minor movements allow us to easily double and triple the annual return of the big general trend, motivating most traders to speculate in the short and medium-term.
These minor oscillations or trends that occur within the large multi-year trends owe their occurrence mainly to two reasons.
First, the FOREX Market presents 3 sessions a day each in different cities of the world with different time zones (Asia, Europe, and America). This causes more frequent trend changes than in the rest of the stock markets.
Second, the purpose for which it was created also plays a role. The modern Foreign Exchange Market, since its inception in 1972, was conceived by the global financial system as a tool for speculation. To obtain benefits in the short and medium-term (from several days to 1 year).
These two points are basically the reasons why we observe the immense speed with which the FOREX market changes trends.
For example, for those who live in America, in the early morning (Europe) the EURUSD pair may be on the rise, in the morning or afternoon (America) it may be down, and then finally at night (Asia) it may return to the rise.

Define your Own Style for your FOREX Investments

One of the first decisions you will have to make is to choose your style as a trader or investor.
There are 4 types of well-defined styles.
Most professional traders tend to have multiple styles, although they always identify with one primary style for their FOREX investments. Study the characteristics of the 4 main styles to make your investments in FOREX :
1. Long Term: recommended for anyone who is going to enter the market for the first time and who can dedicate a minimum of one hour per month to their investments in Forex. The period of an open position ranges from 1 year to 5 years.
2. Medium Term: recommended for anyone who is going to enter the market for the first time and who can dedicate a minimum of one hour per week to their investments in Forex. The period of an open position ranges from 1 month to 1 year.
3. Short Term: recommended for anyone who is going to enter the market for the first time, or who already has a certain time operating in the long and medium-term, showing constant profits, and who can dedicate a minimum of one hour per day to your investments in FOREX. The period of an open position ranges from 1 day to 1 month.
4. Intraday : recommended only for people with a fairly solid earnings record in the short term, and with a capital greater than $ 50,000. As we have noted, this option constitutes a full-time job.
People who start investing in FOREX , should start executing short-term (weeks) and medium-term (months) transactions only, and not pay attention to intraday oscillations (day trading).
If you are interested in being an intraday speculator, I recommend that you first exhaust at least a year doing operations in the short and medium-term to assimilate the correct strategies and to develop the necessary mentality to carry out this work.
The second option would be to participate in some kind of intensive training.
I remind you that self-educating is almost impossible in speculation. You are likely to accumulate a lot of knowledge by reading books and attending courses. But you will probably never learn to make money with all the incomplete "systems" circulating on the internet.

Mistakes to Avoid When Looking for Your Style

Many people who are new to FOREX investments make the mistake of combining these styles, which is a key to failure.
I recommend that if you are not getting the results you expected by adopting one of these styles, do not try to change it. The problem sure is not in the style, but in your strategies or in your psychology.
A successful investor is able to make a profit in any longer trading time than he is used to. I explain. If you are already a profitable operator in the short term, it is very likely that you will also be profitable in the medium and long term,
… As long as you can interpret the Language of Price or Price Action.
In the opposite case, the same would not happen. If you were a medium-term trader, you would need time to adjust to the intraday. The reality is that long, medium and short term traders have very similar personalities. The intraday trader is completely different.

The Myth of the Intraday in Investments in FOREX

If you are already successful in the short, medium and long term, you will notice that the sacrifice and the hours necessary in front of the computer to operate intraday is much greater. The intraday style will be useful to increase your account if it is less than USD $ 100,000 in a very short time in exchange for 8 to 12 hours a day of hard work but ...
You must first develop the necessary skills to operate the intraday.
The ideal is to combine all the styles to get more out of the Market and carry out more effective transactions and have a diversification in your investments in FOREX.
There are intraday traders that are very successful, but the reality is that there are very few in the world that make a profit year after year. If you want to become an intraday, you just have to prepare yourself properly through intensive training.
Otherwise, I recommend that you don't even think about educating yourself to adopt the intraday style. It is not necessary to go against a probability of failure greater than 99%. Unless
... your ego is greater than your common sense.
The main reason why this style of investments in FOREX is not recommended for the vast majority of us "retail investors" (the official term "retail traders"), is the high operational cost.
The real commissions in this market range between $ 2.0 and $ 2.50 for each lot of 100,000 virtual units. This means that a complete operation (opening and closing) is approximately $ 5.00, for each standard lot traded ($ 100,000 virtual).
Another fundamental reason is the advent of robotic traders (HFT = High-Frequency Trading), which tend to manipulate the market in the shorter intraday swings. Please do not confuse HFTs with automated systems that we find daily on the internet, and that can be purchased for a few hundred dollars and often for free on FOREX forums / groups.
These HFTs to which I refer, they are effective. They cost millions of dollars and have been developed by the large Wall Street financial firms to manage their investments in FOREX.
The reality of the intraday trader is that you execute orders for large lots at the same time, to profit from the smallest movements in the market. It is an activity based on reflexes. The slightest oversight or distraction can turn into a catastrophe for your FOREX investments.
I recommend that you start investing in FOREX using slow time periods such as H4 or Daily. For some reason, all Goldman Sachs intraday FOREX investments are made with algorithms.

Finally…

To choose your style as a trader and manage your investments in FOREX, first determine what your degree of experience is, analyze the points mentioned below and the rest you will discover when you execute your first operations.
The points that will affect your decision are:
  • Capital
  • Time available each day
  • Level of Experience
  • Personality
Discovering your style is a search process. For some it will be a long way to find the right time frame that matches their personality. Don't be put off by the falls. After all, those who continue the path despite the falls are the ones who reach the destination.
And I hope you are one of those who get up over and over again. The next lesson will boost your confidence when you discover the main reason that moves currencies ...

Fundamental Analysis in Forex Trading Reddit

The fundamental analysis in Forex is used mostly by long-term investors. Players as we saw in the styles of operators, start a negotiation today, to close it years later.
I always emphasize the importance that the mass media give to this type of analysis to distract the great mass of participants.
It is all part of a great mass psychological manipulation. For centuries the ignorance of the masses has been organized before the great movements begin.
The important news are the macroeconomic reports published by the Central Banks and other government agencies destined for this work. All reports are made up. 99% of them are corrected months later.
These events are tools to justify fundamental analysis and price cleaning movements. Any silly headline does the job. With this, it is possible to absorb most of the existing liquidity, before the new trend phase is projected.

Reaction!

Except in rare situations, the result of an economic report of the fundamental analysis is generally already assimilated in the graph. In most cases, there are financial institutions that already have access to this information and are organizing and carrying out their operations in advance.
The phrase buy the rumor and sell the news is a very old adage on Wall Street. And its meaning contains what we have just explained. For the investor who can interpret the Language of Price, fundamental analysis is of little importance. Well, in general, their disclosure does not indicate that you have to take any action in your open trades , as long as your entry strategy provides you with a good support cushion.
This reality of fundamental analysis causes a lot of confusion for investors who lack in-depth knowledge of the forex market.

Macroeconomic Data

The data published in these events is irrelevant. Both for speculators and for the people in general. They are false. They lack reliability.
The price can go up or down with the same result of the data. The main ones are:
- Interest Rates - GDP (gross domestic product) - CPI (inflation) - ISM (manufacturing index) - NFP (payroll) - Double Deficits (deficit = fiscal + balance of payments)
If you are initiated, I recommend you avoid operating near these events. It is only a matter of having the time pending. Use the economic calendar for Fundamental Analysis of Forex Factory.
There is a probabilistic advantage in operating these fundamental analysis events. But it takes preparation, experience, and practice. They represent a way of diversifying in the general operation of a speculator.

The Uncertainty of Fundamental Analysis

On many occasions after the disclosure of an economic report, the price movement of the currency pair that is going to be affected tends to move in the opposite direction to the logic of the report.
I show you an example of a fundamental analysis report. Imagine that the EUR / USD pair is trading at 1.2500, and the FED (US Federal Reserve) issues a statement announcing that it has just raised inter-bank interest rates from 0.25 points to 0.75 points. Very positive news for the US dollar that logically implies an appreciation of the currency and consequently an instantaneous collapse of the EUR / USD pair (up the dollar and down the euro)
However, minutes after the release of said fundamental analysis report, the pair after effectively collapsing to 1.2400, returns and returns to its levels prior to the report (1.2500). This situation is very common , but it is not so easy to identify it when it is occurring, but after the damage is done.
Traps like these devour the accounts of beginners who approach the market with little experience, with weak strategies, and especially with very little experience.
That is why I reiterate that you forget the fundamental analysis for now. Just keep in mind when operating, that there is no publication scheduled nearby. Just check the economic calendar for the day and forget about the numbers. Let the economists mess around with the data.

FOREX Market Correlation

The Forex market correlation exists between pairs with similar "base" currencies and not always under the same circumstances. The correlation in the Forex market that is most followed and that has the greatest impact on fundamental analysis is that of the US dollar (USD).
The USD is the most traded monetary unit with a volume greater than 80% with respect to the rest of the currencies. This fact determines why their correlation is the most important, the most followed, and perhaps the only one worth following in the fundamental macro analysis.
The 7 major pairs are usually in sync . These 7 pairs all include the USD and present a fundamental analysis correlation almost 75% of the time. Influencing the rest of the currency pairs.

Advantages of the FOREX Market Correlation

In the fundamental analysis the most basic FOREX correlation is the following. When the USD appreciates, the USD / CAD, USD / CHF, and USD / JPY pairs tend to go up in price. This indicates that the Canadian dollar (CAD), the Swiss franc (CHF), and the Japanese yen (JPY) are losing value against the USD.
We must bear in mind that this correlation does not occur 100% of the time. In fact, the JPY generally tends to move in the opposite direction , since in recent decades this currency has been used as a source of financing to invest in other financial instruments.
On the other side is the FOREX market correlation that generates a movement almost in unison in the other 4 major pairs EUR / USD, GBP / USD, AUD / USD, and NZD / USD. These tend to fall in price, homologous the appreciation of the USD. But not always.
In this case the fundamental analysis correlation works most of the time, between 65 and 85% of the time. Small differences are noted in the extent that each of these pairs experiences.
There is also a correlation in the secondary FOREX market, where the pairs of all currencies that do not include the USD participate, but I recommend you not to waste time on them for now. There are more important things about the Language of Price to know first.

FOREX Commodity Correlation

In this part I will explain to you in a basic way the Correlation Commodities - FOREX of the fundamental analysis.
There are three currencies that have a direct correlation with commodities. They are usually called: "COMDOLLS" which is short for "Commodities Dollars" (Commodities Dollars), since all three obey the dollar denomination. These are:
- The New Zealand Dollar (NZD) - The Australian Dollar (AUD) - The Canadian Dollar (CAD)
These three currencies make up the group of the 8 largest together with the euro, the pound, the yen, the franc and the US dollar. Together, they merge to produce the major pairs traded in the FOREX Foreign Exchange Market.
The FOREX Commodity Correlation has an affinity in most cases greater than 75%. And each of them has its different raw material of correlation. You will notice that the NZD and the AUD are two currencies that act practically in unison. Both present minimal discrepancies in their fluctuations in the short, medium and long term.
This is mainly because their economies are very similar and their economic and fiscal policies are too. Their main production items also show great similarities, despite the fact that the Australian economy is much larger than the New Zealand economy.
The raw materials that follow the movement of the AUD are mainly gold and copper. If you put the history of these three quotes during the last decade of the year 2,000 together on the same chart, you will notice a very similar upward movement between the three quotes. Pure correlation of fundamental analysis.
This strong correlation with commodities in the metals area for the AUD has provided Australia with an economic advantage enviable over the other major powers that have seen their currencies devalue sharply against the AUD. At the same time, they experience a constant decrease in the purchasing power of their citizens.
The NZD maintains a correlation with raw materials related to agriculture and livestock, mainly including milk and its derivatives. It is one of the countries that dominates the world export of these economic items, and also has important exports of metals , although in smaller quantities than Australia.
Finally, you have a correlation with raw materials in the energy area. For historical reasons the CAD, which is not the largest oil producer in the world, but an important supplier to the largest consumer that is the US, has seen its currency oscillate in line with oil prices.
To make long-term investments in the Foreign Exchange Market, it is necessary to take into consideration at least one Commodity Correlation - FOREX in your fundamental analysis.

Forex Technical Analysis Reddit

The technical analysis is the methodology that interprets the movements of the price. Specialists look for liquidity to fund their business. The repetition of the strategies used by the specialists in their work generate repetitive patterns.
If you were an analyst, you would develop the visual ability to identify such patterns on a graph. If you were a programmer you would quantify them mathematically using complex formulas.
And if you could learn to interpret the Language of Price, you would have the ability to anticipate 90% of all movements that occur on a chart. And in this business, anticipating is what will make you money.
Market prices are reflected and framed on a horizontal time axis and a vertical price axis. Prices go up or down according to the aggressiveness of the participating operators. In an efficient or balanced market these oscillations should be imperceptible.
But in reality this is not the case, since the Market works thanks to the digital printing of hundreds of billions of units of paper money systematically distributed by the Central Banks through the banking system. These resources serve as a tool to manipulate 100% of the movements that occur in the FOREX Market.
Are you looking for Technical Indicators? All technical indicators were created from the 70's. How do you think that for more than 200 years the speculators of the past accumulated great wealth?
With the Language of Price. The best timing is given by the price itself. Indicator-generated entry signals usually occur at the wrong time.
The basis of technical analysis is human psychology. Unfortunately, human beings are not perfect and are loaded with emotions that dominate their behavior in similar situations, creating repetitive and highly predictable behavior when it occurs in masses.
The study of technical analysis through indicators and subjective training, originates and shapes the collective thinking on which all the traps that specialists execute every day to maintain their business are designed. If the majority won, the Market would cease to exist.
Although you already know that the patterns are not generated by the masses , but the repetitive behavior of the Specialists in the face of the action response of the masses. It is very easy for speculaists, because they can see everyone's orders in their books.
And they also exert a great influence on the decisions of the masses through the mass media. It is what I call the war between the Egg and the Stone , if you hit me you win and if I hit you also you win.

The Deception of Modern Technical Analysis

Through the centuries thousands of people have been able to extract great benefits from the financial markets by applying the basic strategies of technical analysis and the psychology of the Price Language.
More than 200 years ago when the markets began to operate officially, fundamental analysis predominated, which was only used by large financial institutions. As this analysis tool began to become popular, these institutions began to apply the strategies of technical analysis.
In recent decades and with the massification of internet technology, technical analysis has begun to be handled by anyone who has a computer with internet access. The same financial institutions, which have been present for more than a century and as a result of this overcrowding , establish a strategy to confuse and misinform about the true strategies of technical analysis.
This has been accomplished in the following manner. Currently there are hundreds, if not thousands of technical indicators that have been developed by so-called "gurus" of technical analysis and that sell their magic indicators packed in a "system" or "method" that usually cost thousands of dollars, or simply with the publication of a book with which they generate large profits. Double benefit.
The aim is to confuse the initiates in speculation and create the collective mentality that will originate the same behaviors over and over again. About 95% of these new entrants completely lose all the capital they invest in their early stages as investors.
Leaving them with a negative experience and creating the idea and the image that financial markets are an exclusive area for geniuses with high academic levels and that only they can produce returns in the markets year after year.
The initiate, having lost all his original capital, turns to these “gurus” for help and teachings. You spend more capital on the products they offer you and the cycle repeats itself . Obviously, the vast majority do not relapse and completely forget to re-engage in the stock markets.
I hope you have not been a victim of this drama.
Now I will show you the simplicity of a FOREX technical analysis , without the need to resort to any indicator as a tool to determine an effective entry or exit strategy when planning your operations.

The Price Cycle

Previously you studied in the FOREX strategies lesson, that the typical price cycle when it is reflected in a graph, presents four very specific phases and very easy to identify if you perform a technical analysis with common sense . These are:
  • Accumulation
  • Bullish trend
  • Distribution
  • Bearish trend
Remember also that the most effective way to constantly extract profits in the markets is by taking advantage of phases 2 and 4 (the trends). Combined with a correct reading of the collective behavior of the masses of speculators interpreting the Language of Price.
You will be surprised by the simplicity with which thousands of people around the world and over the centuries have accumulated large sums of money by drawing a few simple lines and applying responsible risk management with their capital.

How to Identify Trends?

Being able to determine the trend phases within the price cycle is the essence of technical analysis since it is these two phases that provide you with the probabilistic advantage you need to operate in the markets and obtain constant returns.
In the most plain and simple language, in the world of technical analysis, there are only two types of formations: trends and ranges.
The trends, in turn, can be bullish if they go up, or bearish if they go down. The ranges, on the other hand, can be accumulation if they are at the beginning of the cycle, or distribution if they are in the high part of the cycle. As I had indicated in the topic of FOREX strategies when describing the price cycle.
This sounds more like a play on words, but I will show you the practical definition to simplify your life and then you will apply these definitions on the graph so that everything makes more sense to you.
  • Bullish trend: a succession of major highs and major lows
  • Bearish trend: a succession of minor highs and minor lows
  • Floor Range: equal highs and varied lows
  • Ceiling Range: equal minimums and varied maximums
https://preview.redd.it/vvmsshf0guv51.png?width=600&format=png&auto=webp&s=c321679a7dcc03f7184778be86379ef442fddf91
Some key points from the graph:
  • The start of this big uptrend was detected when the last high (thick green line) of the previous downtrend was broken to the upside, ending the succession of lower highs, while exiting the lateral floor formation.
  • The succession of major lows in the uptrend (thin blue lines)
  • The succession of major highs in the uptrend (thin green lines)
  • The end of the uptrend was detected when the last low (thick blue line) of the uptrend was broken to the downside, ending the succession of higher lows, while exiting the lateral ceiling formation.
A tool that will help you sharpen your technical eye and identify trends on the chart is the Currency Scanner. This application is very effective and will provide you with a much-needed boost in your operations to identify reliable trends. At first, we are not sure how reliable a trend is. You will receive great help to find opportunities with the Currency Scanner .

The Common Sense, The Less Common of Senses

The central idea of ​​technical analysis consists in determining the price situation of a market, that is, in which phase of the pattern of its cycle it is currently conjugated with the collective thinking of the masses and the possible traps that the market would have prepared to remove. the capital at stake by the public.
To carry out a precise technical analysis, you will use the support and resistance lines, which can be static (horizontal) or dynamic (projecting an angle with respect to the horizontal axis).
Your common sense prevails here.
If you show a 10-year-old a chart, they will be able to tell you if the price is going up or down. You will most likely have no idea how to draw the lines, but you will be able to establish the general trend. Simply using your common sense.
By introducing indicators and other gadgets , the simplicity and effectiveness of the technical analysis created by your common sense evaporates.
The following graph conceptually shows you all the possible situations in which you could draw these lines to carry out your technical analysis of the place. You can clearly observe a downtrend delimited by its dynamic trend line and an uptrend on the right side with its respective dynamic delimitation.
https://preview.redd.it/5iehg0r6guv51.png?width=500&format=png&auto=webp&s=84c265a5d35da7ea970792c4bf40fe20b33bd8bd

Forex Charts Analysis

I want to remind you that the formations or patterns that develop on the charts (triangles, wedges, pennants, boxes, etc.) only work to execute trades that have initially been confirmed by the static support and resistance lines and to read the collective thinking of the masses.
Chart formations work, but you must know the Language of Price to determine when the Specialists will exploit a chartist figure, or when they will allow it to run. In fact, you will learn with the Language that you can operate a chart figure in any direction.
Much of the "mentalization" that the masses receive is to believe that the figures are made to be respected. Which is an inefficient way of working. Simply because you could wait days or months for a perfect chart figure to occur in order to perform a reliable trade. When in fact there are dozens every day.

Japanese Candles

Of all the tools you have to carry out technical analysis, perhaps the best known and most popular is the Japanese technique of candles (candlesticks).
Candles are mainly used to identify reversal points on the chart without resorting to confirmation of horizontal trend lines and only using a previous bar or candle breaks.
Its correct use is subject to a multi-time analysis (multiple temporalities) and a general evaluation of the context proposed by the market in general at the time of each scenario.
Later I will show you all the important details to take into account so that you use Japanese candles in a simple and very effective way.
Do not forget ... Trading in your beginnings based on formations (chartism) and candlestick patterns conjugated with hundreds of tools and technical indicators, constitutes the perfect path to your failure. Before using any strategy or technique I recommend you focus on learning the Price Language, which includes 3 basic things:
  • The Price: structure and dynamics
  • Market sentiment: relative strength, external shocks, etc.
  • Psychology: flexible mindset and risk acceptance
After you acquire this solid foundation, I guarantee that you will be able to trade any trading system that exists, any strategy, technique or chart figure in a profitable and consistent manner.
Specialists make money every day at the expense of the collective behavior caused by the use of these strategies and techniques. With which you will only manage to lose your capital and your time by putting the cart in front of the horse.
People who do the opposite, at best become,
... Philosophers of Speculation, or indocile Robot Assistants or Expert Advisors.
To make money in any market condition, range or trend, you must use the technical analysis based on the Price Language and combine it with a correct psychological reading of the price. This knowledge can only be acquired through proper education and lots of supervised practice. Like any other career in life.
I hope you've found this guide helpful!
submitted by kayakero to makemoneyforexreddit [link] [comments]

When will we bottom out?

PART 2 : https://www.reddit.com/wallstreetbets/comments/g0sd44/what_is_the_bottom/
PART 3: https://www.reddit.com/wallstreetbets/comments/g2enz2/why_the_printer_must_continue/
Edit: By popular demand, the too long didn't read is now at the top
TL;DR
SPY 220p 11/20
This will likely be a multi-part series. It should be noted that I am no expert by any means, I'm actually quite new to this, it is just an elementary analysis of patterns in price and time. I am not a financial advisor, and this is not advice for a person to enter trades upon.
The fundamental divide in trading revolves around the question of market structure. Many feel that the market operates totally randomly and its’ behavior cannot be predicted. For the purposes of this DD, we will assume that the market has a structure, but that that structure is not perfect. That market structure naturally generates chart patterns as the market records prices in time. We will analyze an instrument, an exchange traded fund, which represents an index, as opposed to a particular stock. The price patterns of the various stocks in an index are effectively smoothed out. In doing so, a more technical picture arises. Perhaps the most popular of these is the SPDR S&P Standard and Poor 500 Exchange Traded Fund ($SPY).
In trading, little to no concern is given about value of underlying asset. We concerned primarily about liquidity and trading ranges, which are the amount of value fluctuating on a short-term basis, as measured by volatility-implied trading ranges. Fundamental analysis plays a role, however markets often do not react to real-world factors in a logical fashion. Therefore, fundamental analysis is more appropriate for long-term investing.
The fundamental derivatives of a chart are time (x-axis) and price (y-axis). The primary technical indicator is price, as everything else is lagging in the past. Price represents current asking price and incorrectly implementing positions based on price is one of the biggest trading errors.
Markets ordinarily have noise, their tendency to back-and-fill, which must be filtered out for true pattern recognition. That noise does have a utility, however, in allowing traders second chances to enter favorable positions at slightly less favorable entry points. When you have any market with enough liquidity for historical data to record a pattern, then a structure can be divined. The market probes prices as part of an ongoing price-discovery process. Market technicians must sometimes look outside of the technical realm and use visual inspection to ascertain the relevance of certain patterns, using a qualitative eye that recognizes the underlying quantitative nature
Markets rise slower than they correct, however they rise much more than they fall. In the same vein, instruments can only fall to having no worth, whereas they could theoretically grow infinitely and have continued to grow over time. Money in a fiat system is illusory. It is a fundamentally synthetic instrument which has no intrinsic value. Hence, the recent seemingly illogical fluctuations in the market.
According to trade theory, the unending purpose of a market is to create and break price ranges according to the laws of supply and demand. We must determine when to trade based on each market inflection point as defined in price and in time as opposed to abandoning the trend (as the contrarian trading in this sub often does). Time and Price symmetry must be used to be in accordance with the trend. When coupled with a favorable risk to reward ratio, the ability to stay in the market for most of the defined time period, and adherence to risk management rules; the trader has a solid methodology for achieving considerable gains.
We will engage in a longer term market-oriented analysis to avoid any time-focused pressure. The market is technically open 24-hours a day, so trading may be done when the individual is ready, without any pressing need to be constantly alert. Let alone, we can safely project months in advance with relatively high accuracy.
Some important terms to keep in mind:
§ Discrete – terminal points at the extremes of ranges
§ Secondary Discrete – quantified retracement or correction between two discrete
§ Longs (asset appreciation) and shorts (asset depreciation)
- Technical indicators are often considered self-fulfilling prophecies due to mass-market psychology gravitating towards certain common numbers yielded from them. That means a trader must be especially aware of these numbers as they can prognosticate market movements. Often, they are meaningless in the larger picture of things.
§ Volume – derived from the market itself, it is mostly irrelevant. The major problem with volume is that the US market open causes tremendous volume surges eradicating any intrinsic volume analysis. At major highs and lows, the market is typically anemic. Most traders are not active at terminal discretes because of levels of fear. Allows us confidence in time and price symmetry market inflection points, if we observe low volume at a foretold range of values. We can rationalize that an absolute discrete is usually only discovered and anticipated by very few traders. As the general market realizes it, a herd mentality will push the market in the direction favorable to defending it. Volume is also useful for swing trading, as chances for swing’s validity increases if an increase in volume is seen on and after the swing’s activation.
Therefore, due to the relatively high volume on the 23rd of March, we can safely determine that a low WAS NOT reached.
§ VIX – Volatility Index, this technical indicator indicates level of fear by the amount of options-based “insurance” in portfolios. A low VIX environment, less than 20 for the S&P index, indicates a stable market with a possible uptrend. A high VIX, over 20, indicates a possible downtrend. However, it is equally important to see how VIX is changing over time, if it is decreasing or increasing, as that indicates increasing or decreasing fear. Low volatility allows high leverage without risk or rest. Occasionally, markets do rise with high VIX.
As VIX is unusually high, in the forties, we can be confident that a downtrend is imminent.
– Trend definition is highly powerful, cannot be understated. Knowledge of trend logic is enough to be a profitable trader, yet defining a trend is an arduous process. Multiple trends coexist across multiple time frames and across multiple market sectors. Like time structure, it makes the underlying price of the instrument irrelevant. Trend definitions cannot determine the validity of newly formed discretes. Trend becomes apparent when trades based in counter-trend inflection points continue to fail.
Downtrends are defined as an instrument making lower lows and lower highs that are recurrent, additive, qualified swing setups. Downtrends for all instruments are similar, except forex. They are fast and complete much quicker than uptrends. An average downtrend is 18 months, something which we will return to. An uptrend inception occurs when an instrument reaches a point where it fails to make a new low, then that low will be tested. After that, the instrument will either have a deep range retracement or it may take out the low slightly, resulting in a double-bottom. A swing must eventually form.
A simple way to roughly determine trend is to attempt to draw a line from three tops going upwards (uptrend) or a line from three bottoms going downwards (downtrend). It is not possible to correctly draw an uptrend line on the SPY chart, but it is possible to correctly draw a downtrend – indicating that the overall trend is downwards.
Now that we have determined that the overall trend is downwards, the next issue is the question of when SPY will bottom out.
Time is the movement from the past through the present into the future. It is a measurement in quantified intervals. In many ways, our perception of it is a human construct. It is more powerful than price as time may be utilized for a trade regardless of the market inflection point’s price. Were it possible to perfectly understand time, price would be totally irrelevant due to the predictive certainty time affords. Time structure is easier to learn than price, but much more difficult to apply with any accuracy. It is the hardest aspect of trading to learn, but also the most rewarding.
Humans do not have the ability to recognize every time window, however the ability to define market inflection points in terms of time is the single most powerful trading edge. Regardless, price should not be abandoned for time alone. Time structure analysis It is inherently flawed, as such the markets have a fail-safe, which is Price Structure. Even though Time is much more powerful, Price Structure should never be completely ignored. Time is the qualifier for Price and vice versa. Time can fail by tricking traders into counter-trend trading.
Time is a predestined trade quantifier, a filter to slow trades down, as it allows a trader to specifically focus on specific time windows and rest at others. It allows for quantitative measurements to reach deterministic values and is the primary qualifier for trends. Time structure should be utilized before price structure, and it is the primary trade criterion which requires support from price. We can see price structure on a chart, as areas of mathematical support or resistance, but we cannot see time structure.
Time may be used to tell us an exact point in the future where the market will inflect, after Price Theory has been fulfilled. In the present, price objectives based on price theory added to possible future times for market inflection points give us the exact time of market inflection points and price.
Time Structure is repetitions of time or inherent cycles of time, occurring in a methodical way to provide time windows which may be utilized for inflection points. They are not easily recognized and not easily defined by a price chart as measuring and observing time is very exact. Time structure is not a science, yet it does require precise measurements. Nothing is certain or definite. The critical question must be if a particular approach to time structure is currently lucrative or not.
We will complete our analysis of time by measuring it in intervals of 180 bars. Our goal is to determine time windows, when the market will react and when we should pay the most attention. By using time repetitions, the fact that market inflection points occurred at some point in the past and should, therefore, reoccur at some point in the future, we should obtain confidence as to when SPY will reach a market inflection point. Time repetitions are essentially the market’s memory. However, simply measuring the time between two points then trying to extrapolate into the future does not work. Measuring time is not the same as defining time repetitions. We will evaluate past sessions for market inflection points, whether discretes, qualified swings, or intra-range. Then records the times that the market has made highs or lows in a comparable time period to the future one seeks to trade in.
What follows is a time Histogram – A grouping of times which appear close together, then segregated based on that closeness. Time is aligned into combined histogram of repetitions and cycles, however cycles are irrelevant on a daily basis. If trading on an hourly basis, do not use hours.
Yearly Lows: 12/31/2000, 9/21/2001, 10/9/2002, 3/11/2003, 8/2/2004, 4/15/2005, 6/12/2006, 3/5/2007, 11/17/2008, 3/9/2009, 7/2/10, 10/3/11, 1/1/12, 1/1/13, 2/3/14, 9/28/15, 2/8/16, 1/3/17, 12/24/18, 6/3/19
Months: 1, 1, 1, 2, 2, 3, 3, 3, 4, 6, 6, 7, 8, 9, 9, 10, 10, 11, 12, 12
Days: 1, 1, 2, 2, 3, 3, 3, 3, 5, 8, 9, 9, 11, 12, 15, 17, 21, 24, 28, 31
Monthly Lows: 3/23, 2/28, 1/27, 12/3, 11/1, 10/2, 9/3, 8/5, 7/1, 6/3, 5/31, 4/1
Days: 1, 1, 1, 2, 3, 3, 3, 5, 23, 27, 27, 31
Weighted Times are repetitions which appears multiple times within the same list, observed and accentuated once divided into relevant sections of the histogram. They are important in the presently defined trading time period and are similar to a mathematical mode with respect to a series. Phased times are essentially periodical patterns in histograms, though they do not guarantee inflection points*.*
We see that SPY tends to have its lows between three major month clusters: 1-4, primarily March (which has actually occurred already this year), 6-9, averaged out to July, and 10-12, averaged out to November. Following the same methodology, we get the third and tenth days of the month as the likeliest days. However, evaluating the monthly lows for the past year, the end of the month has replaced the average of the tenth. Therefore, we have four primary dates for our histogram.
7/3/20, 7/27/20, and 11/3/20, 11/27/20 .
How do we narrow this group down with any accuracy? Let us average the days together to work with two dates - 7/15/20 and 11/15/20.
The 8.6-Year Armstrong-Princeton Global Economic Confidence model – states that 2.15 year intervals occur between corrections, relevant highs and lows. 2.15 years from the all-time peak discrete is April 14th of 2022. However, we can time-shift to other peaks and troughs to determine a date for this year. If we consider 1/28/2018 as a localized high and apply this model, we get 3/23/20 as a low - strikingly accurate. I have chosen the next localized high, 9/21/2018 to apply the model to. We achieve a date of 11/14/2020.
The average bear market is eighteen months long, giving us a date of August 19th, 2021 for the end of the bear market - roughly speaking.
Therefore, our timeline looks like:
As we move forward in time, our predictions may be less accurate. It is important to keep in mind that this analysis will likely change and become more accurate as we factor in Terry Laundry’s T-Theory, the Bradley Cycle, a more sophisticated analysis of Bull and Bear Market Cycles, the Fundamental Investor Cyclic Approach, and Seasons and Half-Seasons.
I have also assumed that the audience believes in these models, which is not necessary. Anyone with free time may construct histograms and view these time models, determining for themselves what is accurate and what is not. Take a look at 1/28/2008, that localized high, and 2.15 years (1/4th of the sinusoidal wave of the model) later.
The question now is, what prices will SPY reach on 11/14? Where will we be at 7/28? What will happen on 4/14/22?
submitted by aibnsamin1 to wallstreetbets [link] [comments]

How to get started in Forex - A comprehensive guide for newbies

Almost every day people come to this subreddit asking the same basic questions over and over again. I've put this guide together to point you in the right direction and help you get started on your forex journey.

A quick background on me before you ask: My name is Bob, I'm based out of western Canada. I started my forex journey back in January 2018 and am still learning. However I am trading live, not on demo accounts. I also code my own EA's. I not certified, licensed, insured, or even remotely qualified as a professional in the finance industry. Nothing I say constitutes financial advice. Take what I'm saying with a grain of salt, but everything I've outlined below is a synopsis of some tough lessons I've learned over the last year of being in this business.

LET'S GET SOME UNPLEASANTNESS OUT OF THE WAY

I'm going to call you stupid. I'm also going to call you dumb. I'm going to call you many other things. I do this because odds are, you are stupid, foolish,and just asking to have your money taken away. Welcome to the 95% of retail traders. Perhaps uneducated or uninformed are better phrases, but I've never been a big proponent of being politically correct.

Want to get out of the 95% and join the 5% of us who actually make money doing this? Put your grown up pants on, buck up, and don't give me any of this pc "This is hurting my feelings so I'm not going to listen to you" bullshit that the world has been moving towards.

Let's rip the bandage off quickly on this point - the world does not give a fuck about you. At one point maybe it did, it was this amazing vision nicknamed the American Dream. It died an agonizing, horrible death at the hand of capitalists and entrepreneurs. The world today revolves around money. Your money, my money, everybody's money. People want to take your money to add it to theirs. They don't give a fuck if it forces you out on the street and your family has to live in cardboard box. The world just stopped caring in general. It sucks, but it's the way the world works now. Welcome to the new world order. It's called Capitalism.

And here comes the next hard truth that you will need to accept - Forex is a cruel bitch of a mistress. She will hurt you. She will torment you. She will give you nightmares. She will keep you awake at night. And then she will tease you with a glimmer of hope to lure you into a false sense of security before she then guts you like a fish and shows you what your insides look like. This statement applies to all trading markets - they are cruel, ruthless, and not for the weak minded.

The sooner you accept these truths, the sooner you will become profitable. Don't accept it? That's fine. Don't bother reading any further. If I've offended you I don't give a fuck. You can run back home and hide under your bed. The world doesn't care and neither do I.

For what it's worth - I am not normally an major condescending asshole like the above paragraphs would suggest. In fact, if you look through my posts on this subreddit you will see I am actually quite helpful most of the time to many people who come here. But I need you to really understand that Forex is not for most people. It will make you cry. And if the markets themselves don't do it, the people in the markets will.

LESSON 1 - LEARN THE BASICS

Save yourself and everybody here a bunch of time - learn the basics of forex. You can learn the basics for free - BabyPips has one of the best free courses online which explains what exactly forex is, how it works, different strategies and methods of how to approach trading, and many other amazing topics.

You can access the BabyPips course by clicking this link: https://www.babypips.com/learn/forex

Do EVERY course in the School of Pipsology. It's free, it's comprehensive, and it will save you from a lot of trouble. It also has the added benefit of preventing you from looking foolish and uneducated when you come here asking for help if you already know this stuff.

If you still have questions about how forex works, please see the FREE RESOURCES links on the /Forex FAQ which can be found here: https://www.reddit.com/Forex/wiki/index

Quiz Time
Answer these questions truthfully to yourself:

-What is the difference between a market order, a stop order, and a limit order?
-How do you draw a support/resistance line? (Demonstrate it to yourself)
-What is the difference between MACD, RSI, and Stochastic indicators?
-What is fundamental analysis and how does it differ from technical analysis and price action trading?
-True or False: It's better to have a broker who gives you 500:1 margin instead of 50:1 margin. Be able to justify your reasoning.

If you don't know to answer to any of these questions, then you aren't ready to move on. Go back to the School of Pipsology linked above and do it all again.

If you can answer these questions without having to refer to any kind of reference then congratulations, you are ready to move past being a forex newbie and are ready to dive into the wonderful world of currency trading! Move onto Lesson 2 below.

LESSON 2 - RANDOM STRANGERS ARE NOT GOING TO HELP YOU GET RICH IN FOREX

This may come as a bit of a shock to you, but that random stranger on instagram who is posting about how he is killing it on forex is not trying to insprire you to greatness. He's also not trying to help you. He's also not trying to teach you how to attain financial freedom.

99.99999% of people posting about wanting to help you become rich in forex are LYING TO YOU.

Why would such nice, polite people do such a thing? Because THEY ARE TRYING TO PROFIT FROM YOUR STUPIDITY.

Plain and simple. Here's just a few ways these "experts" and "gurus" profit from you:


These are just a few examples. The reality is that very few people make it big in forex or any kind of trading. If somebody is trying to sell you the dream, they are essentially a magician - making you look the other way while they snatch your wallet and clean you out.

Additionally, on the topic of fund managers - legitimate fund managers will be certified, licensed, and insured. Ask them for proof of those 3 things. What they typically look like are:

If you are talking to a fund manager and they are insisting they have all of these, get a copy of their verification documents and lookup their licenses on the directories of the issuers to verify they are valid. If they are, then at least you are talking to somebody who seems to have their shit together and is doing investment management and trading as a professional and you are at least partially protected when the shit hits the fan.


LESSON 3 - UNDERSTAND YOUR RISK

Many people jump into Forex, drop $2000 into a broker account and start trading 1 lot orders because they signed up with a broker thinking they will get rich because they were given 500:1 margin and can risk it all on each trade. Worst-case scenario you lose your account, best case scenario you become a millionaire very quickly. Seems like a pretty good gamble right? You are dead wrong.

As a new trader, you should never risk more than 1% of your account balance on a trade. If you have some experience and are confident and doing well, then it's perfectly natural to risk 2-3% of your account per trade. Anybody who risks more than 4-5% of their account on a single trade deserves to blow their account. At that point you aren't trading, you are gambling. Don't pretend you are a trader when really you are just putting everything on red and hoping the roulette ball lands in the right spot. It's stupid and reckless and going to screw you very quickly.

Let's do some math here:

You put $2,000 into your trading account.
Risking 1% means you are willing to lose $20 per trade. That means you are going to be trading micro lots, or 0.01 lots most likely ($0.10/pip). At that level you can have a trade stop loss at -200 pips and only lose $20. It's the best starting point for anybody. Additionally, if you SL 20 trades in a row you are only down $200 (or 10% of your account) which isn't that difficult to recover from.
Risking 3% means you are willing to lose $60 per trade. You could do mini lots at this point, which is 0.1 lots (or $1/pip). Let's say you SL on 20 trades in a row. You've just lost $1,200 or 60% of your account. Even veteran traders will go through periods of repeat SL'ing, you are not a special snowflake and are not immune to periods of major drawdown.
Risking 5% means you are willing to lose $100 per trade. SL 20 trades in a row, your account is blown. As Red Foreman would call it - Good job dumbass.

Never risk more than 1% of your account on any trade until you can show that you are either consistently breaking even or making a profit. By consistently, I mean 200 trades minimum. You do 200 trades over a period of time and either break-even or make a profit, then you should be alright to increase your risk.

Unfortunately, this is where many retail traders get greedy and blow it. They will do 10 trades and hit their profit target on 9 of them. They will start seeing huge piles of money in their future and get greedy. They will start taking more risk on their trades than their account can handle.

200 trades of break-even or profitable performance risking 1% per trade. Don't even think about increasing your risk tolerance until you do it. When you get to this point, increase you risk to 2%. Do 1,000 trades at this level and show break-even or profit. If you blow your account, go back down to 1% until you can figure out what the hell you did differently or wrong, fix your strategy, and try again.

Once you clear 1,000 trades at 2%, it's really up to you if you want to increase your risk. I don't recommend it. Even 2% is bordering on gambling to be honest.


LESSON 4 - THE 500 PIP DRAWDOWN RULE

This is a rule I created for myself and it's a great way to help protect your account from blowing.

Sometimes the market goes insane. Like really insane. Insane to the point that your broker can't keep up and they can't hold your orders to the SL and TP levels you specified. They will try, but during a flash crash like we had at the start of January 2019 the rules can sometimes go flying out the window on account of the trading servers being unable to keep up with all the shit that's hitting the fan.

Because of this I live by a rule I call the 500 Pip Drawdown Rule and it's really quite simple - Have enough funds in your account to cover a 500 pip drawdown on your largest open trade. I don't care if you set a SL of -50 pips. During a flash crash that shit sometimes just breaks.

So let's use an example - you open a 0.1 lot short order on USDCAD and set the SL to 50 pips (so you'd only lose $50 if you hit stoploss). An hour later Trump makes some absurd announcement which causes a massive fundamental event on the market. A flash crash happens and over the course of the next few minutes USDCAD spikes up 500 pips, your broker is struggling to keep shit under control and your order slips through the cracks. By the time your broker is able to clear the backlog of orders and activity, your order closes out at 500 pips in the red. You just lost $500 when you intended initially to only risk $50.

It gets kinda scary if you are dealing with whole lot orders. A single order with a 500 pip drawdown is $5,000 gone in an instant. That will decimate many trader accounts.

Remember my statements above about Forex being a cruel bitch of a mistress? I wasn't kidding.

Granted - the above scenario is very rare to actually happen. But glitches to happen from time to time. Broker servers go offline. Weird shit happens which sets off a fundamental shift. Lots of stuff can break your account very quickly if you aren't using proper risk management.


LESSON 5 - UNDERSTAND DIFFERENT TRADING METHODOLOGIES

Generally speaking, there are 3 trading methodologies that traders employ. It's important to figure out what method you intend to use before asking for help. Each has their pros and cons, and you can combine them in a somewhat hybrid methodology but that introduces challenges as well.

In a nutshell:

Now you may be thinking that you want to be a a price action trader - you should still learn the principles and concepts behind TA and FA. Same if you are planning to be a technical trader - you should learn about price action and fundamental analysis. More knowledge is better, always.

With regards to technical analysis, you need to really understand what the different indicators are tell you. It's very easy to misinterpret what an indicator is telling you, which causes you to make a bad trade and lose money. It's also important to understand that every indicator can be tuned to your personal preferences.

You might find, for example, that using Bollinger Bands with the normal 20 period SMA close, 2 standard deviation is not effective for how you look at the chart, but changing that to say a 20 period EMA average price, 1 standard deviation bollinger band indicator could give you significantly more insight.


LESSON 6 - TIMEFRAMES MATTER

Understanding the differences in which timeframes you trade on will make or break your chosen strategy. Some strategies work really well on Daily timeframes (i.e. Ichimoku) but they fall flat on their face if you use them on 1H timeframes, for example.

There is no right or wrong answer on what timeframe is best to trade on. Generally speaking however, there are 2 things to consider:


If you are a total newbie to forex, I suggest you don't trade on anything shorter than the 1H timeframe when you are first learning. Trading on higher timeframes tends to be much more forgiving and profitable per trade. Scalping is a delicate art and requires finesse and can be very challenging when you are first starting out.


LESSON 7 - AUTOBOTS...ROLL OUT!

Yeah...I'm a geek and grew up with the Transformers franchise decades before Michael Bay came along. Deal with it.

Forex bots are called EA's (Expert Advisors). They can be wonderous and devastating at the same time. /Forex is not really the best place to get help with them. That is what /algotrading is useful for. However some of us that lurk on /Forex code EA's and will try to assist when we can.

Anybody can learn to code an EA. But just like how 95% of retail traders fail, I would estimate the same is true for forex bots. Either the strategy doesn't work, the code is buggy, or many other reasons can cause EA's to fail. Because EA's can often times run up hundreds of orders in a very quick period of time, it's critical that you test them repeatedly before letting them lose on a live trading account so they don't blow your account to pieces. You have been warned.

If you want to learn how to code an EA, I suggest you start with MQL. It's a programming language which can be directly interpretted by Meta Trader. The Meta Trader terminal client even gives you a built in IDE for coding EA's in MQL. The downside is it can be buggy and glitchy and caused many frustrating hours of work to figure out what is wrong.

If you don't want to learn MQL, you can code an EA up in just about any programming language. Python is really popular for forex bots for some reason. But that doesn't mean you couldn't do it in something like C++ or Java or hell even something more unusual like JQuery if you really wanted.

I'm not going to get into the finer details of how to code EA's, there are some amazing guides out there. Just be careful with them. They can be your best friend and at the same time also your worst enemy when it comes to forex.

One final note on EA's - don't buy them. Ever. Let me put this into perspective - I create an EA which is literally producing money for me automatically 24/5. If it really is a good EA which is profitable, there is no way in hell I'm selling it. I'm keeping it to myself to make a fortune off of. EA's that are for sale will not work, will blow your account, and the developer who coded it will tell you that's too darn bad but no refunds. Don't ever buy an EA from anybody.

LESSON 8 - BRING ON THE HATERS

You are going to find that this subreddit is frequented by trolls. Some of them will get really nasty. Some of them will threaten you. Some of them will just make you miserable. It's the price you pay for admission to the /Forex club.

If you can't handle it, then I suggest you don't post here. Find a more newbie-friendly site. It sucks, but it's reality.

We often refer to trolls on this subreddit as shitcunts. That's your word of the day. Learn it, love it. Shitcunts.


YOU MADE IT, WELCOME TO FOREX!

If you've made it through all of the above and aren't cringing or getting scared, then welcome aboard the forex train! You will fit in nicely here. Ask your questions and the non-shitcunts of our little corner of reddit will try to help you.

Assuming this post doesn't get nuked and I don't get banned for it, I'll add more lessons to this post over time. Lessons I intend to add in the future:
If there is something else you feel should be included please drop a comment and I'll add it to the above list of pending topics.

Cheers,

Bob



submitted by wafflestation to Forex [link] [comments]

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Financial websites started in the late 1990s with many more coming online in the 2000s. Some, such as Bankrate, started out in print decades ago before transforming into one of the best financial websites. Financial planning websites can help you to learn how to manage your money and to build wealth in a more effective way.
Learn about the best financial websites and financial blogs from M1 Finance Users of the best financial websites today
According to data from Statista, the top three leading finance websites by visitors include Yahoo! Finance with 70 million visitors per month, MSN Money Central with 65 million monthly visitors, and CNN Money with 50 million monthly visitors. The need for financial education and literacy is clear. According to the Financial Educators Council, the average test result for financial literacy across all age groups was a low 63%.
According to the Next Web, more than one million new users of the internet are coming online every day. There are reportedly over 4.3 billion internet users who are now online around the world. The global reach of the internet makes it an ideal vehicle for helping people around the world to become financially literate.
What are some of the best general financial websites?
These best financial websites are leaders in the provision of general financial information. Investors of all levels can benefit by making it a habit to read these top financial websites on a regular basis.
Yahoo!Finance
Yahoo! Finance aggregates finance news from around the internet. It also allows you to purchase company reports. You can find charts, price quotes, information about competitor companies, earnings reports and key ratios for free.
CNBC Markets
CNBC Markets provides up-to-date news about the global markets. In the news section, you can find listings of developments in the U.S. stock markets as well as for developments across Europe and Asia.
Forbes Money
Forbes Money is a leader in the finance and business world. Readers who are invested in topics such as investing, business and leadership can all find something that appeals to them in Forbes. In addition to finance topics, Forbes also covers related financial areas.
Investing.com
Investing.com is one of the best financial sites for people who are interested in active trading. On the home page, you can view forex prices, ETFs, commodities prices and futures contracts. The news section offers in-depth articles. Investors check this site daily to see current quotes for a variety of different investments.
Bloomberg
Bloomberg is one of the best financial websites for market data. On its news section, you can choose from different categories by region, general financial information, industry and asset class. You can see the historical information for a queried stock, which is helpful in identifying how different types of news reports impact the performance of the stock.
Reuters
Reuters is another website for obtaining market data. It offers broad coverage of stock news, sector news and market news. You can also find historical information, as well as an auto-complete stock name feature that is helpful search tool.
GoogleFinance
GoogleFinance is one of the best financial sites because of its search functionality. You can find an abundance of information about price quotes, news, competitor companies, earnings reports and key ratios. Keep in mind that some news items are not in real-time.
Read about the best financial websites and financial blogs from M1 Finance The Wall Street Journal
The Wall Street Journal has been released in print format since 1989. Online, it is reviewed as one of the top financial websites around the world. Readers from across the globe subscribe to the Wall Street Journal for its business news. The WSJ also offers its readers email alerts about news and stock information.
Investopedia
Investopedia is one of the best financial websites because of its emphasis on financial education. You are able to start a watchlist to track your stocks and can take courses on investing through its Investopedia Academy. The many articles offered by Investopedia is a rich resource for people who want to learn more about the stock market and financial principles.
Financial Times
The Financial Times is another leading publication that is read around the world. It offers comprehensive international coverage of financial news. However, you are only able to read the headlines for free. With a paid subscription, you can read the detailed news reports and gain access to diversified content.
NerdWallet
NerdWallet is one of the best financial websites for comparisons. The site allows you to compare investment accounts, high-yield savings accounts, CDs, debit cards, mortgages and credit cards. The site releases a best list for every category annually.
The Economist
The Economist is another go-to source for the latest in international news. It is authoritative and offers in-depth coverage of politics, finance, business, technology and science.
BankRate
BankRate was launched in 1976 as a newsletter and is highly respected. It has become one of the best financial websites available on the internet. You can find a wealth of data on mortgages, bank rates and credit cards. It also offers online financial advice about financial planning, investing and saving for retirement.
Barron’s
Barron’s is a weekly newspaper that has been published since 1921. On its website, it provides news about market developments in the U.S., financial information and related statistics. The website contains interest sections with in-depth coverage contained within each. Latest financial news can be found on its home page, while interest sections include technology, retirement, options and funds.
SEC
The SEC offers primary source material such as the quarterly and annual financial reports that have been filed with the SEC. These include publicly-traded companies’ filings. All of this data can be accessed through EDGAR on the SEC’s website by searching for a stock ticker symbol or the name of a company.
Kiplinger
Kiplinger ranks as one of the top financial advice websites. It is a sound resource for financial advice with coverage on how to save money and avoid fees. Kiplinger has a section that covers the basics of personal finance and has quizzes on a variety of finance topics.
Motley Fool
The Motley Fool offers investors in-depth analysis on general financial information. It also has stock market analyses and insights. While the name might be odd, the financial services company encourages its readers to become financially independent through information and research. Access to advice from experts is offered for an additional charge.
Money Morning
Money Morning boasts a free daily newsletter on information that can help you to become financially independent. The site’s layout is divided into major categories as well as hot topics sections. You can find advice on different stocks with in-depth analyses.
What are some of the best financial websites for stocks and trading?
If you are wanting to focus on the best financial websites for stocks, you can cut down your search time by including in your reading these best financial sites that we have listed for you. Each of these sites allows you to get the information that you need about different stocks and companies so that you can make informed investment decisions.
Investigate the best financial websites and financial blogs from M1 Finance CNN Markets
CNN is among the top news networks in the world. It has a markets section that simplifies browsing of economic news. The markets section contains current financial news, commodities changes, trending stocks and much more. Each of these topics has its own dedicated page for more in-depth information. If you want a fast update about the market news, CNN is a great source.
MarketWatch
MarketWatch has a news viewer section that gives you access to stories that have timestamps. News items are automatically updated, and its coverage includes global stock markets, forex, commodities and other classes of assets. It also offers data about macroeconomics and fundamental analysis information.
Seeking Alpha
Seeking Alpha aggregates data from other financial sites. You can find trending finance articles from across the internet together with the top-performing stocks and recent news. Seeking Alpha articles range from types of investment to investment strategies.
NASDAQ
NASDAQ offers the latest analysis and stock market news. You can find information on companies and their competitors, the latest news and see how the markets are performing. The site also provides quote updates and financial tools to aid in your investing endeavors.
Morningstar
Morningstar allows you to view annual returns of ETFs and mutual funds for the past 10 years. Quarterly and monthly returns for the past five years are also available on this site. You can review the after-tax returns of different funds so that you can gain a better idea of investor earnings.
The Street
The Street is one of the best financial sites for news about investing. When you read The Street, you can find opinions, recommendations, current events and how to get started in the market. There are also paid services that are available to investors, including market analyses and advanced strategies.
Zacks Investment Research
Zacks Investment Research requires you to sign up for a free membership to gain access to its data on funds and stocks. You are able to use this site to conduct comprehensive research. Zacks gives you access to independent reports that can help you when you are trying to build a well-diversified portfolio.
Review the best financial websites and financial blogs from M1 Finance NYSE
If you are invested in the stock market, the NYSE should be included on your list of best financial sites to read. The NYSE access includes listings information, markets, historical and real-time market data. All investors should make a habit of checking the NYSE’s site on a regular basis to stay informed.
What are some of the best financial blog sites?
Our list of best financial websites contains multiple finance blogs. These blogs offer online financial advice and financial planning tools while also providing answers to common investing questions. A list of the best financial sites would not be complete without including these top financial websites.
The Balance
The Balance offers articles that are divided into categories such as retirement, investing, debt management and banking. The articles give advice about many areas of finance and aim to increase your financial literacy.
Wise Bread
Wise Bread is a community of personal finance bloggers and finance experts. The goal is to help people to live well financially and to derive more enjoyment out of life. It includes multiple sections, including personal finance, frugal living, life hacks, credit cards and career advice.
Financial Post
The Financial Post offers a mix of financial news and analysis together with personal finance advice. The site targets a range of people from young investors to high net worth investors.
Money Crashers
Money Crashers is a comprehensive site that covers nearly all things related to finance. You can find information about debt, credit, investments, living frugally, small business and family. The goal is to educate those who are looking to make sound financial decisions.
The Simple Dollar
The Simple Dollar, written by the author of “365 Ways to Live Cheap!”, provides numerous tips for frugal living. It is one of the best financial planning websites for people who are wanting to gain control of their finances. Reading this blog can give you answers to your financial questions about how to reduce your expenses so that you can live within your means.
Good Financial Cents
Good Financial Cents is one of the best financial sites for people who want to learn about personal finance. It is written by Jeff Rose, who also has a YouTube Channel featuring many of his blog topics. The focus of this certified financial advisor’s blog is to educate people on how to become financially independent.
Financial Samurai
The Financial Samurai was established in 2009 by Sam Dogen. He was able to leave his job in corporate America after 13 years by saving at least 50% of his after-tax income from the time that he began his professional job. He invested his savings in real estate, bonds, stocks and CDs in order to have enough passive income to be able to quit his job and focus on his blog. He offers information about wealth management, financial products, real estate and more.
Dave Ramsey
Dave Ramsey is a well-known expert in the finance field who offers financial planning tools and personal finance education. His blog is recognized as one of the top financial planning websites and is used by millions of people to learn how to build wealth, reduce debt and increase their savings.
Mint Life
Mint Life is among the best financial sites for people who are looking for a broad personal finance resource. The blog contains a large list of money management categories with a range of articles available in each. The categories include everything from student finances, housing finances, food budgets, to much more.
Mr. Money Mustache
Mr. Money Mustache is a credible finance site with a quirky name. The author, who was able to retire at age 30, started his blog in 2005 when he was 36 years old. The blog’s mission is to allow you to learn how to live below your means and to build your savings quickly so that you can retire early, too.
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submitted by luis3445 to M1Finance [link] [comments]

[WallText] For those who really want to be forex traders.

Im sry if u find some grammatical errors, english is not my mother language. Let me know and i will fix it.
First of all, look for at least half an hour without interruptions to read this manual.
This is the system that has created trading professionals. He has done it and today he continues doing it, as it happened with me.
It is not a system written in any forum, in fact I believe that it has been the first to collect all the ideas and create a structure to follow to carry them out, but these same ideas and procedures have been the ones that the winning traders have used during decades and will continue to use, since they are based on completely objective and real foundations.
Let's go to it:
Hi all.
It is known that the observation time makes the patterns elucidate, and after some time in the forum and throughout this trading world I have found many patterns in the responses of the people, I have reasoned about them, and I have realized their failures, why they fail to be profitable.
There are people who have put effort into this. Not all, but there are people who have really read a lot, studied a lot, learned a lot and tried a lot, and even then they are not able to achieve stable profitability.
The question is: Is there enough in that effort? Is there a specific moment in the line of learning where you start to be profitable? The question is, logically.
There are traders that generate constant profitability. Hedge funds, investment firms ... and the difference is in areas where people for some reason do not want to invest time.
Why are there more messages in the strategy forums than in the psychology, journals and fundamental analysis together?
As human beings, our brain is programmed to look for quick positive responses. In nature, the brain does not understand the concept of long-term investment. There is only a short-term investment made from the difference between what we think will cost us something and what we think it will contribute. If we think that it will cost us more than it can give us, we simply do not feel motivated. It is a simple mechanism.
The market plays with these mechanisms. There are more scalpers created from the search for that positive emotion than from the search for a scalping system.
In short, we are not programmed to operate, and there lies the fact that only a huge minority of operators are profitable.
Among others, I have observed several patterns of behavior that make a trader fail, and they are:
- Search for immediate pleasure: The trader wants to feel that he has won on the one hand, and on the other he wants to avoid the feeling of loss. Following this there are many traders who place a very low take profit and a very high stop loss. This is not bad if the probabilities have been reviewed before, the mathematical factor of hope, the relation with the drawdown .. but in the majority of the cases absolutely nothing of statistics is known. There is only that need to win. They win, they win, they win, until one day the odds do their job and the stop loss is touched, returning the account to its origins or leaving it with less money than it started. This does not work.
- Search for immediate wealth: Again it is something immediate. People want good emotions, and we want them already. The vast majority of traders approach this world with fantasies of wealth, women and expensive cars, but do not visualize hard work, the sickly hard work behind all this.
From there underlie behaviors like eternally looking for new robots or expert advisors that promise a lot of money, or new systems. The type of trader that has this integrated pattern is characterized by doing nothing more than that. Spend the day looking for new strategies Of course he never manages to earn constant money.
- Think that trading is easy: Trading is not easy, it is simple. Why? Because when you get the wisdom and experience necessary to find yourself in a state of superior knowledge about the market and effectively make money, it is very simple; you just have to apply the same equation again and again. However, it is not easy to reach this equation. This equation includes variables such as risk understanding, mathematics, certain characteristics in the personality that must be assimilated little by little, intelligence, a lot of experience ..
This is not easy. This is a business, and in fact it is one of the most difficult businesses in the world. It may seem simple to see a series of candles on a screen or perhaps a line, or any type of graphic, but it is not. Behind the screen there are hundreds of thousands of very intelligent professionals, very disciplined, very educated, very ...
This business is the most profitable in the world if you know how to carry, since it is based on the concept of compound interest, but it is also one of the most difficult. And I repeat. It's a business, not a game. I think you'll never hear a lawyer say to his boss: "We're going to focus all our time on finding a strategy that ALWAYS makes us win a trial, ALWAYS." What does it sound ridiculous? It sounds to me just as ridiculous for trading.
But you are not to blame, you have been subconsciously deceived through the advertising brokers and your own internal desires, to think that this is something easy.
- Lack of discipline: Trading is not something you can do 10 minutes on Monday and 6 on Thursday. This is not a game, and until you get a regular schedule you can not start earning money. There are people who open a graph one day for 5 minutes, then return to their normal life and then one week returns to look at it for other minutes.
Trading should not be treated as a hobby. If you want to win "some money" I advise you not even to get in, because you will end up losing something or a lot of money. You have to think if you really want trading to be part of your life. It's like when you meet a girl and you want to get married. Do you really want to get into this with all the consequences? Because otherwise it will not work.
Visualize the hard work behind this. Candle nights, frustrations, several hundred dollars lost (at the beginning) .. enter the world of trading with a really deep reason, if you lose a time and money that no one will return, and both things are finite!
- Know something and pretend to know everything: Making money in the markets is not based on painting the graph as a child a paper with crayon wax and pretend to make money.
It is not based on drawing lines or circles, or squares. It is based on understanding the operation of all these tools, the background of the why of the tools of trading.
A trend line only marks the cycle of a wave within a longer time frame, within a longer time frame, and so on indefinitely. In turn, this wave is divided into waves with a specific behavior, divided into smaller waves and Etcetera, and understanding that dynamic is fundamental to winning.
It is not the fact of drawing a line. That can be done by an 8 year old boy. It is the fact of UNDERSTANDING why.
There are traders who read two technical analysis books and a delta analysis book and believe that they are professionals, but do they really understand the behavior of the market? The answer is in their portfolios.
After this explanation that only 10% will have read, I will try to detail step by step something that is 90% yearning, and that will have quickly turned the scroll of your mouse to find the solution to all your problems while supporting the beer in a book of " become rich ", rotten by lack of use.
These steps must be carried out one by one, starting with the first, fulfilling it, moving on to the second, successively and growing. If steps are taken for granted, or not fully met, it simply will not work.
I know this will happen and the person who did it will think "Bah, this does not work." and you will return to your top strategy search routine.
That said, let start:
1º Create a REAL account with 50 dollars approximately:
_ Forget the demo accounts. They are a utopia, they do not work. There is infinite liquidity, without emotions and without slipagge.
These things will change when we enter the real market, and the most experienced person in the world will notice a sharp drop in their profitability when it happens to real accounts.
And not only using a demo account has disadvantages, but using a real one has advantages.
We will have a real slipagge with real liquidity. Real requotes and more. The most important: We will work our emotions at the same time. Because yes, we will lose or win a couple of cents, but that has a subconscious impact of loss.
This means that we will begin to expand our comfort zone from the start.
Using a demo account is simply a disadvantage.
2º Buy a newspaper in the stationery or in Chinese (optional), or write one online or in Word:
A newspaper will be of GREAT help. You can not imagine, for those of you who do not have one, how a newspaper can exponentiate our learning curve. It is simply absurd not to have a diary. It's like taking a ticket of 5 instead of one of 100.
In this diary we will write down observations that we make about the operations that we will carry out in points that I will explain later of this same manual.
We will divide the newspaper into 2 parts:
  • 1 part: The operation itself. We will write the reasons for each operation. The why we have done it.
  • 2 part: How we feel. We will unburden ourselves without explaining how we feel, what our intuition tells us about that particular operation and so on.
How to use:
We will read the newspaper once a week, thinking about the emotions we felt each day and in what situations, and the reasons.
Soon, we will begin to realize that we have certain patterns in the way we feel and operate, and we will have the ability to change them.
We can also learn from mistakes that we make, and keep them always in a diary.
3º Look for a strategy that has the following characteristics:
  • Make it SIMPLE. Nothing of 4 or more indicators or the colors of the gay flag drawn on the graph based on 1000 lines. Why? Because there is always an initial enthusiasm and maybe we can follow a complex strategy for a week, but burned that motivation, saturates us and we will leave it aside.
Therefore, the strategy must be simple. If we use metatrader, the default indicators work. No macd's no-lag and similar tools. That does not lead anywhere. And if you do not believe it, I'll tell you that in all areas of life comes marketing. In addition to trading towards MMA and now I do powerlifts, and there are 1000 exercises to do. However, the classics are still working and work very well. It seems that sellers of strange sports equipment do not share the same opinion, that the only thing they want is to sell!
4º Understand the strategy:
  • We must gut each process of the strategy and reason about it. What does this indicator do? What does this process? Why this and not another? Why this exit ?. Some strategies will be based on unspecified outputs. This does not suppose any problem because as we get experience in that specific strategy, we will remember situations that have occurred, we will see situations that are repeated (patterns) and we will be able to find better starts and entrances. Everything is in our hands.
5° Collect essential statistical information:
  • This part is FUNDAMENTAL, and no operator can have as much security in itself when operating as if it uses a strategy that has at least positive mathematical hope and an acceptable drawdown.
  • Step 1: To carry out this collection of information you need to test the strategy for at least 100 signals. Yes, 100 signals.
Assuming it is an intraday strategy and we do an operation per day, it will take us 100 days (3 months and 10 days approx) to carry out the study. Logically these figures can change depending on the number of operations that we make up to date with the strategy.
I have no doubt that after reading this manual we will go for a quick strategy of scalpers, with 100 signals every 10 minutes where the seller comes out with a big smile in his promotional video.
I personally recommend a system of maximum 2 daily operations to start, but this point is personal.
Is it a long time? Go! It turns out that a college student of average intelligence takes 6 years to finish a career. It takes 6 years just to train, and there are even more races. This does not guarantee any profitability, and in any case most of Sometimes it will get a static return and not based on compound interest. I can never aspire to more.
The market offers compound profitability, there will be no bosses, nor schedules that we do not impose. We will always have work, and we can earn a lot more money than most people with careers or masters. Is it a long time? I do not think so.
As I was saying, we will test the strategy 100 times with our REAL account that we created in step 1. Did you decide to use a demo account? Better look for another manual; This has to be something serious. They are 100 dollars and will be the best investment of all in your career as a trader.
  • Step 2: Once with the report of the 100 strategies in hand, we will collect the following information:
  • How many times have we won and how many lost. Afterwards, we will find the percentage of correct answers.
  • How much have we won and how much have we lost? Afterwards, we will find the average profit and the average loss.
  • Step 3: With this information we will complete the mathematical hope formula:
(1 + average profit / average loss) * (percentage of correct answers / 100) -1
Example:
  • Of the 100 operations there are 50 winners and 50 losers, then the success rate is 50%.
  • Our average profit is 20 dollars and our average loss is 10 dollars.
Filling the formula:
(1 + 20/10) * (50/100) -1
(1 + 2) * (0,5) -1
3 * 0.5 - 1
1,5 - 1 = 0,5
In this example the mathematical expectation is 0.5. It is POSITIVE, because it is greater than 0. From 0, we will know that this strategy will make us earn money over time ALWAYS we respect the strategy.
If after a few days we modify it, then we will have to find this equation again with another 100 different operations. Easy? A result of "0" would mean that this strategy does not win or lose, but in the long run we would LOSE due to the spread and other random factors.
You have to try to find a strategy that, once this study is done, the result of your mathematical hope is greater than 0.2 as MINIMUM.
Finding this formula will also give a curious fact. The greater the take profit in relation to the stop loss, as a general rule more positive will be our mathematical hope. This has given many pages of discursiones about whether to place take profit> stop loss or vice versa.
If our stop was larger than the take profit, then the other ratio (% earned /% lost) should be yes or yes positive.
But this is just curiosities.
let's keep going:
  • 6° Expand our comfort zone:
We will not be able to work with operations of 10 million dollars overnight, but we can progressively condition ourselves to that path.
Assuming all of the above, and with a real account, some experience in the 3 months of information gathering and a positive mathematical hope, we are ready to operate in real with some consistency. But how to carry it out?
The comfort zone is the psychological limits we have before feeling fear or emotional tension. When we get into a fight, we have left our comfort zone and we feel tension, unless we have a psychopathic disorder.
Every time we lean out onto a 300-meter balcony from a skyscraper, we move away from the comfort zone. Every time we speak to a depampanante woman, we move away from our comfort zone.
Our brain creates a comfort zone to differentiate what we usually do and is not substantially dangerous, from the unknown and potentially dangerous to our survival or reproduction. And whenever the brain interprets that these two aspects are in danger, we will feel negative emotions like fear, disgust, loneliness, fury, etcetera.
This topic is much more profound and you would have to read several volumes of evolutionism to understand the why of each thing. The only thing that interests us here is the "what", and the one, that is, that there is a certain comfort zone that must be expanded without any problems.
With trading, exactly the same thing happens. The forex market is a virtual environment in which we lose or gain things, but our brain does not differentiate between reality and what is not, it only attends to stimuli of a certain type.
We can lose food in the middle of the forest or also a crude oil operation.
Our goal is to condition our subconscious so that it is progressively accepting lost and small benefits, and as time goes by, bigger.
The exercise to achieve this is the following:
  • We will operate on that account of 100 dollars with our mathematically positive strategy for 3 more months.
  • After these three months, our account should have benefits, because of the mathematically positive strategy.
  • We will enter 200 dollars more and we will operate a month more raising the lots according to our risk management (I do not advise that the risk is greater than 2%)
At this point, I know how hard it is to resign myself to impatience, but follow those times and do not skip it even if you feel safe, but you will fail, it's simple.
Let's keep going:
  • After that month, we will raise our capital again with a new income. This time we will enter 1000 dollars (save if you do not have 1000 dollars loose, you will recover later on, do you want to make money, enter 1000 dollars.
We will test the operation one month with this new injection. We probably notice difficulties. More blockages, more euphoria when winning ... how will we know when to move on to the next entry? When we do not feel ANYTHING or at most something very shallow, when win or lose If observing the wall and operating is for you the same from an emotional point of view, it is time to enter more money.
  • We will follow this procedure until we have a basic account of 21000 dollars. The amounts to be paid will depend on our ability to not feel emotions, a capacity that will be taking over time.
We will raise capital until we feel that we block too much. In that case we will drawdown to a more acceptable amount, and we will continue at that level until get discipline and lack of reactivity at that level. Later, we will go up.
  • If we want to earn more money, we will continue entering and entering. Always following the conditioning scheme of 1 month.
Why a month?
A study conducted in the United States revealed that the subconscious needs an average of 28 days to create new habits or eliminate old habits. Emotional reactions are part of the habits. If we maintain some pressure of any emotion during the opportune time, in this case 28 days, will create tolerance and the subconscious will need a more intense version of the stimulus to activate.
AND THAT'S ALL!
Follow these steps and you will triumph. Here is the golden chalice, the tomb of Jesus or whatever you want to call it. There is no more mystery in the world of trading. This system will accompany you during the next year, year and a half. It's the one I used and it WORKS. Once done, you will have a very profitable system integrated into your being, since not only will it be mathematically viable, but you will also have the necessary experience to make it infinitely more profitable yet.
In addition, you will have psychology fully worked on a professional level to have conditioned your subconscious gradually.
Happy trading to all of u guys.-
submitted by Harry-Postre to Forex [link] [comments]

Trump Didn’t Kill the Global Trade System. He Split It in Two.

This article is taken from the Wall Street Journal written about nine months ago and sits behind a a paywall, so I decided to copy and paste it here. This article explains Trump's policies toward global trade and what has actually happened so far. I think the article does a decent job of explaining the Trade War. While alot has happenedsince the article was written, I still think its relevant.
However, what is lacking in the article, like many articles on the trade war, is it doesn't really explain the history of US trade policy, the laws that the US administration is using to place tariffs on China and the official justification for the US President in enacting tariffs against China. In my analysis I will cover those points.

SUMMARY

When Trump entered the White House people feared he would dismantle the global system the US and its allies had built over the last 75 years, but he hasn't. He has realign into two systems. One between the US and its allies which looks similar to the one built since the 1980s with a few of quota and tariffs. As the article points out
Today, Korus and Nafta have been replaced by updated agreements(one not yet ratified) that look much like the originals. South Korea accepted quotas on steel. Mexico and Canada agreed to higher wages, North American content requirements and quotas for autos. Furthermore, the article points out Douglas Irwin, an economist and trade historian at Dartmouth College, calls these results the “status quo with Trumpian tweaks: a little more managed trade sprinkled about for favored industries. It’s not good, but it’s not the destruction of the system.” Mr. Trump’s actions so far affect only 12% of U.S. imports, according to Chad Bown of the Peterson Institute for International Economics. In 1984, 21% of imports were covered by similar restraints, many imposed by Mr. Reagan, such as on cars, steel, motorcycles and clothing. Protectionist instincts go so far in the US, there are strong lobby groups for both protectionist and freetrade in the US.
The second reflects a emerging rivalry between the US and China. Undo some of the integration that followed China accession to the WTO. Two questions 1) How far is the US willing to decouple with China 2) Can it persuade allies to join.
The second is going to be difficult because China's economic ties are greater than they were between the Soviets, and China isn't waging an ideological struggle. Trump lacks Reagan commitment to alliance and free trade. The status quo with China is crumbling Dan Sullivan, a Republican senator from Alaska, personifies these broader forces reshaping the U.S. approach to the world. When Mr. Xi visited the U.S. in 2015, Mr. Sullivan urged his colleagues to pay more attention to China’s rise. On the Senate floor, he quoted the political scientist Graham Allison: “War between the U.S. and China is more likely than recognized at the moment.” Last spring, Mr. Sullivan went to China and met officials including Vice President Wang Qishan. They seemed to think tensions with the U.S. will fade after Mr. Trump leaves the scene, Mr. Sullivan recalled. “I just said, ‘You are completely misreading this.’” The mistrust, he told them, is bipartisan, and will outlast Mr. Trump. both Bush II and Obama tried to change dialogue and engagement, but by the end of his term, Obama was questioning the approach. Trump has declared engagement. “We don’t like it when our allies steal our ideas either, but it’s a much less dangerous situation,” said Derek Scissors, a China expert at the American Enterprise Institute whose views align with the administration’s more hawkish officials. “We’re not worried about the war-fighting capability of Japan and Korea because they’re our friends.”
The article also points out unlike George Kennan in 1946 who made a case for containing the Soviet Union, the US hasn't explicitly made a case for containing the Soviets, Trump's administration hasn't, because as the the article explains its divided Michael Pillsbury a Hudson Institute scholar close to the Trump team, see 3 scenarios
Pillsbury thinks the third is most likely to happen, even though the administration hasn't said that it has adopted that policy. The US is stepping efforts to draw in other trading partners. The US, EU and Japan have launched a WTO effort to crack down on domestic subsidies and technology transfers requirement. US and Domestic concerns with prompted some countries to restrict Huawei. The US is also seeking to walloff China from other trade deals. However, there are risk with this strategy

ARTICLE

Trump Didn’t Kill the Global Trade System. He Split It in Two.

INTRODUCTION

My main criticism of this article is it tries like the vast majority of articles to fit US trade actions in the larger context of US geopolitical strategy. Even the author isn't certain "The first goes to the heart of Mr. Trump’s goal. If his aim is to hold back China’s advance, economists predict he will fail.". If you try to treat the trade "war" and US geopolitical strategy toward China as one, you will find yourself quickly frustrated and confused. If you treat them separately with their different set of stakeholders and histories, were they intersect with regards to China, but diverge. During the Cold War, trade policy toward the Soviet Union and Eastern Bloc was subordinated to geopolitical concerns. For Trump, the trade issues are more important than geopolitical strategy. His protectionist trade rhetoric has been fairly consistent since 1980s. In his administration, the top cabinet members holding economic portfolios, those of Commerce, Treasury and US Trade Representative are the same people he picked when he first took office. The Director of the Economic Council has changed hands once, its role isn't as important as the National Security Advisor. While State, Defense, CIA, Homeland Security, UN Ambassador, National Security Advisor have changed hands at least once. Only the Director of National Intelligence hasn't changed.
International Trade makes up 1/4 of the US economy, and like national security its primarily the responsibility of the Federal government. States in the US don't implement their own tariffs. If you add the impact of Treasury policy and how it relates to capital flows in and out of the US, the amounts easily exceed the size of the US economy. Furthermore, because of US Dollar role as the reserve currency and US control of over global system the impact of Treasury are global. Trade policy and investment flows runs through two federal departments Commerce and Treasury and for trade also USTR. Defense spending makes up 3.3% of GDP, and if you add in related homeland security its at most 4%. Why would anyone assume that these two realms be integrated let alone trade policy subordinate to whims of a national security bureaucracy in most instances? With North Korea or Iran, trade and investment subordinate themselves to national security, because to Treasury and Commerce bureaucrats and their affiliated interest groups, Iran and the DPRK are well, economic midgets, but China is a different matter.
The analysis will be divided into four sections. The first will be to provide a brief overview of US trade policy since 1914. The second section will discuss why the US is going after China on trade issues, and why the US has resorted using a bilateral approach as opposed to going through the WTO. The third section we will talk about how relations with China is hashed out in the US.
The reason why I submitted this article, because there aren't many post trying to explain US-China Trade War from a trade perspective. Here is a post titled "What is the Reasons for America's Trade War with China, and not one person mentioned Article 301 or China's WTO Commitments. You get numerous post saying that Huawei is at heart of the trade war. Its fine, but if you don't know what was inside the USTR Investigative report that lead to the tariffs. its like skipping dinner and only having dessert When the US President, Donald J Trump, says he wants to negotiate a better trade deal with other countries, and has been going on about for the last 35 years, longer than many of you have been alive, why do people think that the key issues with China aren't primarily about trade at the moment.

OVERVIEW OF THE UNITED STATES TRADE ORIENTATION

Before 1940s, the US could be categorized as a free market protectionist economy. For many this may seem like oxymoron, how can an economy be free market and protectionist? In 1913, government spending made up about 7.5% of US GDP, in the UK it was 13%, and for Germany 18% (Public Spending in the 20th Century A Global Perspective: Ludger Schuknecht and Vito Tanzi - 2000). UK had virtual zero tariffs, while for manufactured goods in France it was 20%, 13% Germany, 9% Belgium and 4% Netherlands. For raw materials and agricultural products, it was almost zero. In contrast, for the likes of United States, Russia and Japan it was 44%, 84% and 30% respectively. Even though in 1900 United States was an economic powerhouse along with Germany, manufactured exports only made up 30% of exports, and the US government saw tariffs as exclusively a domestic policy matter and didn't see tariffs as something to be negotiated with other nations. The US didn't have the large constituency to push the government for lower tariffs abroad for their exports like in Britain in the 1830-40s (Reluctant Partners: A History of Multilateral Trade Cooperation, 1850-2000).
The Underwood Tariffs Act of 1913 which legislated the income tax, dropped the tariffs to 1850 levels levels.Until 16th amendment was ratified in 1913 making income tax legal, all US federal revenue came from excise and tariffs. In contrast before 1914, about 50% of UK revenue came from income taxes. The reason for US reluctance to introduced income tax was ideological and the United State's relative weak government compared to those in Europe. After the First World War, the US introduced the Emergency Tariff Act of 1921, than the Fordney–McCumber Tariff of 1922 followed by a Smoot-Hawley Act of 1930. Contrary to popular opinion, the Smoot-Hawley Act of 1930 had a small negative impact on the economy, since imports and exports played a small part of the US economy, and the tariffs were lower than the average that existed from 1850-1914.
Immediately after the Second World War, when the US economy was the only industrialized economy left standing, the economic focus was on rehabilitation and monetary stability. There was no grandiose and ideological design. Bretton Woods system linked the US dollar to gold to create monetary stability, and to avoid competitive devaluation and tariffs that plagued the world economy after Britain took itself off the gold in 1931. The US$ was the natural choice, because in 1944 2/3 of the world's gold was in the US. One reason why the Marshall Plan was created was to alleviate the chronic deficits Europeans countries had with the US between 1945-50. It was to rebuild their economies so they could start exports good to the US. Even before it was full implemented in 1959, it was already facing problems, the trade surpluses that the US was running in the 1940s, turned to deficits as European and Japanese economies recovered. By 1959, Federal Reserves foreign liabilities had already exceeded its gold reserves. There were fears of a run on the US gold supply and arbitrage. A secondary policy of the Bretton woods system was curbs on capital outflows to reduce speculation on currency pegs, and this had a negative impact on foreign investment until it was abandoned in 1971. It wasn't until the 1980s, where foreign investment recovered to levels prior to 1914. Factoring out the big spike in global oil prices as a result of the OPEC cartel, it most likely wasn't until the mid-1990s that exports as a % of GDP had reached 1914 levels.
Until the 1980s, the US record regarding free trade and markets was mediocre. The impetus to remove trade barriers in Europe after the Second World War was driven by the Europeans themselves. The EEC already had a custom union in 1968, Canada and the US have yet to even discuss implementing one. Even with Canada it took the US over 50 years to get a Free Trade Agreement. NAFTA was inspired by the success of the EEC. NAFTA was very much an elite driven project. If the Americans put the NAFTA to a referendum like the British did with the EEC in the seventies, it most likely wouldn't pass. People often look at segregation in the US South as a political issue, but it was economic issue as well. How could the US preach free trade, when it didn't have free trade in its own country. Segregation was a internal non-tariff barrier. In the first election after the end of the Cold War in 1992, Ross Perot' based most of independent run for the Presidency on opposition to NAFTA. He won 19% of the vote. Like Ross Perot before him, Donald Trump is not the exception in how America has handled tariffs since the founding of the Republic, but more the norm.
The embrace of free trade by the business and political elite can be attributed to two events. After the end of Bretton Woods in 1971, a strong vested interest in the US in the form of multinationals and Wall Street emerged advocating for removal of tariffs and more importantly the removal of restrictions on free flow of capital, whether direct foreign investment in portfolio investment. However, the political class embrace of free trade and capital only really took off after the collapse of the Soviet Union propelled by Cold War triumphalism.
As mentioned by the article, the US is reverting back to a pre-WTO relations with China. As Robert Lighthizer said in speech in 2000
I guess my prescription, really, is to move back to more of a negotiating kind of a settlement. Return to WTO and what it really was meant to be. Something where you have somebody make a decision but have it not be binding.
The US is using financial and legal instruments developed during the Cold War like its extradition treaties (with Canada and Europe), and Section 301. Here is a very good recent article about enforcement commitment that China will make.‘Painful’ enforcement ahead for China if trade war deal is reached with US insisting on unilateral terms
NOTE: It is very difficult to talk about US-China trade war without a basic knowledge of global economic history since 1914. What a lot of people do is politicize or subordinate the economic history to the political. Some commentators think US power was just handed to them after the Second World War, when the US was the only industrialized economy left standing. The dominant position of the US was temporary and in reality its like having 10 tonnes of Gold sitting in your house, it doesn't automatically translate to influence. The US from 1945-1989 was slowly and gradually build her influence in the non-Communist world. For example, US influence in Canada in the 1960s wasn't as strong as it is now. Only 50% of Canadian exports went to the US in 1960s vs 80% at the present moment.

BASIS OF THE US TRADE DISCUSSION WITH CHINA

According to preliminary agreement between China and the US based on unnamed sources in the Wall Street Journal article US, China close in on Trade Deal. In this article it divides the deal in two sections. The first aspects have largely to do with deficits and is political.
As part of a deal, China is pledging to help level the playing field, including speeding up the timetable for removing foreign-ownership limitations on car ventures and reducing tariffs on imported vehicles to below the current auto tariff of 15%. Beijing would also step up purchases of U.S. goods—a tactic designed to appeal to President Trump, who campaigned on closing the bilateral trade deficit with China. One of the sweeteners would be an $18 billion natural-gas purchase from Cheniere Energy Inc., people familiar with the transaction said.
The second part will involve the following.
  1. Commitment Regarding Industrial Policy
  2. Provisions to protect IP
  3. Mechanism which complaints by US companies can be addressed
  4. Bilateral meetings adjudicate disputes. If talks don't produce agreement than US can raise tariffs unilaterally
This grouping of conditions is similar to the points filled under the 301 investigation which serve the basis for initiating the tariffs. I have been reading some sources that say this discussion on this second group of broader issues could only be finalized later
The official justifications for placing the tariffs on Chinese goods is found under the March 2018 investigation submitted by the office of the President to Congress titled FINDINGS OF THE INVESTIGATION INTO CHINA’S ACTS, POLICIES, AND PRACTICES RELATED TO TECHNOLOGY TRANSFER, INTELLECTUAL PROPERTY, AND INNOVATION UNDER SECTION 301 OF THE TRADE ACT OF 1974. From this investigation the United States Trade Representative (USTR) place US Tariffs on Chinese goods as per Section 301 of the Trade Act of 1974. Here is a press release by the USTR listing the reasons for placing tariffs, and the key section from the press release. Specifically, the Section 301 investigation revealed:
In the bigger context of trade relations between US and China, China is not honoring its WTO commitments, and the USTR issued its yearly report to Congress in early February about the status of China compliance with its WTO commitments. The points that served as a basis for applying Section 301, also deviate from her commitments as Clinton's Trade Representative Charlene Barshefsky paving the way for a trade war. Barshefsky argues that China's back sliding was happening as early as 2006-07, and believes the trade war could have been avoided has those commitments been enforced by previous administrations.
I will provide a brief overview of WTO membership and China's process of getting into the WTO.
WTO members can be divided into two groups, first are countries that joined in 1995-97, and were members of GATT, than there are the second group that joined after 1997. China joined in 2001. There is an argument that when China joined in 2001, she faced more stringent conditions than other developing countries that joined before, because the vast majority of developing countries were members of GATT, and were admitted to the WTO based on that previous membership in GATT. Here is Brookings Institute article published in 2001 titled "Issues in China’s WTO Accession"
This question is all the more puzzling because the scope and depth of demands placed on entrants into the formal international trading system have increased substantially since the formal conclusion of the Uruguay Round of trade negotiations in 1994, which expanded the agenda considerably by covering many services, agriculture, intellectual property, and certain aspects of foreign direct investment. Since 1994, the international community has added agreements covering information technology, basic telecommunications services, and financial services. WTO membership now entails liberalization of a much broader range of domestic economic activity, including areas that traditionally have been regarded by most countries as among the most sensitive, than was required of countries entering the WTO’s predecessor organization the GATT.
The terms of China’s protocol of accession to the World Trade Organization reflect the developments just described and more. China’s market access commitments are much more far-reaching than those that governed the accession of countries only a decade ago. And, as a condition for membership, China was required to make protocol commitments that substantially exceed those made by any other member of the World Trade Organization, including those that have joined since 1995. The broader and deeper commitments China has made inevitably will entail substantial short-term economic costs.
What are the WTO commitments Barshefsky goes on about? When countries join the WTO, particularly those countries that weren't members of GATT and joined after 1997, they have to work toward fulfilling certain commitments. There are 4 key documents when countries make an accession to WTO membership, the working party report, the accession protocol paper, the goods schedule and service schedule.
In the working party report as part of the conclusion which specifies the commitment of each member country what they will do in areas that aren't compliant with WTO regulations on the date they joined. The problem there is no good enforcement mechanism for other members to force China to comply with these commitments. And WTO punishments are weak.
Here is the commitment paragraph for China
"The Working Party took note of the explanations and statements of China concerning its foreign trade regime, as reflected in this Report. The Working Party took note of the commitments given by China in relation to certain specific matters which are reproduced in paragraphs 18-19, 22-23, 35-36, 40, 42, 46-47, 49, 60, 62, 64, 68, 70, 73, 75, 78-79, 83-84, 86, 91-93, 96, 100-103, 107, 111, 115-117, 119-120, 122-123, 126-132, 136, 138, 140, 143, 145, 146, 148, 152, 154, 157, 162, 165, 167-168, 170-174, 177-178, 180, 182, 184-185, 187, 190-197, 199-200, 203-207, 210, 212-213, 215, 217, 222-223, 225, 227-228, 231-235, 238, 240-242, 252, 256, 259, 263, 265, 270, 275, 284, 286, 288, 291, 292, 296, 299, 302, 304-305, 307-310, 312-318, 320, 322, 331-334, 336, 339 and 341 of this Report and noted that these commitments are incorporated in paragraph 1.2 of the Draft Protocol. "
This is a tool by the WTO that list all the WTO commitment of each country in the working paper. In the goods and service schedule they have commitments for particular sectors. Here is the a press release by the WTO in September 2001, after successfully concluding talks for accession, and brief summary of key areas in which China hasn't fulfilled her commitments. Most of the commitments made by China were made to address its legacy as a non-market economy and involvement of state owned enterprises. In my opinion, I think the US government and investors grew increasingly frustrated with China, after 2007 not just because of China's back sliding, but relative to other countries who joined after 1997 like Vietnam, another non-market Leninist dictatorship. When comparing China's commitments to the WTO its best to compare her progress with those that joined after 1997, which were mostly ex-Soviet Republics.
NOTE: The Chinese media have for two decades compared any time the US has talked about China's currency manipulation or any other issue as a pretext for imposing tariffs on China to the Plaza Accords. I am very sure people will raise it here. My criticism of this view is fourfold. First, the US targeted not just Japan, but France, Britain and the UK as well. Secondly, the causes of the Japan lost decade were due largely to internal factors. Thirdly, Japan, UK, Britain and France in the 1980s, the Yuan isn't undervalued today. Lastly, in the USTR investigation, its China's practices that are the concern, not so much the trade deficit.

REASONS FOR TRUMPS UNILATERAL APPROACH

I feel that people shouldn't dismiss Trump's unilateral approach toward China for several reasons.
  1. The multilateral approach won't work in many issues such as the trade deficit, commercial espionage and intellectual property, because US and her allies have different interest with regard to these issues. Germany and Japan and trade surpluses with China, while the US runs a deficit. In order to reach a consensus means the West has to compromise among themselves, and the end result if the type of toothless resolutions you commonly find in ASEAN regarding the SCS. Does America want to "compromise" its interest to appease a politician like Justin Trudeau? Not to mention opposition from domestic interest. TPP was opposed by both Clinton and Trump during the election.
  2. You can't launch a geopolitical front against China using a newly formed trade block like the TPP. Some of the existing TPP members are in economic groups with China, like Malaysia and Australia.
  3. China has joined a multitude of international bodies, and at least in trade, these bodies haven't changed its behavior.
  4. Dealing with China, its a no win situation whether you use a tough multilateral / unilateral approach. If the US endorse a tough unilateral approach gives the impression that the US is acting like the British during the Opium War. If you take a concerted Western approach you are accused of acting like the 8 Powers Alliance in 1900.
  5. Trump was elected to deal with China which he and his supporters believe was responsible for the loss of millions manufacturing jobs when China joined the WTO in 2001. It is estimate the US lost 6 Million jobs, about 1/4 of US manufacturing Jobs. This has been subsequently advanced by some economists. The ball got rolling when Bill Clinton decided to grant China Most Favored Nation status in 1999, just a decade after Tiananmen.
  6. China hasn't dealt with issues like IP protection, market access, subsidies to state own companies and state funded industrial spying.
To his credit, Trump has said his aim was not to overthrow authoritarian governments, and that even applies to the likes of Iran. The Arab spring scared Russia and China, because the US for a brief moment placed the spread of democracy over its security interest.

UNDERSTANDING HOW THE US MAKES DECISIONS REGARDING CHINA

At this moment, China or the trade war isn't an area of great concern for the American public, among international issues it ranks lower than international terrorism, North Korea and Iran's nuclear program.
According to the survey, 39 percent of the country views China’s growing power as a “critical threat” to Americans. That ranked it only eighth among 12 potential threats listed and placed China well behind the perceived threats from international terrorism (66 percent), North Korea’s nuclear program (59 percent) and Iran’s nuclear program (52 percent). It’s also considerably lower than when the same question was asked during the 1990s, when more than half of those polled listed China as a critical threat. That broadly tracks with a recent poll from the Pew Research Center that found concern about U.S.-China economic issues had decreased since 2012.
In looking at how US conducts relations foreign policy with China, we should look at it from the three areas of most concern - economic, national security and ideology. Each sphere has their interest groups, and sometimes groups can occupy two spheres at once. Security experts are concerned with some aspects of China's economic actions like IP theft and industrial policy (China 2025), because they are related to security. In these sphere there are your hawks and dove. And each sphere is dominated by certain interest groups. That is why US policy toward China can often appear contradictory. You have Trump want to reduce the trade deficit, but security experts advocating for restrictions on dual use technology who are buttressed by people who want export restrictions on China, as a way of getting market access.
Right now the economic concerns are most dominant, and the hawks seem to dominate. The economic hawks traditionally have been domestic manufacturing companies and economic nationalist. In reality the hawks aren't dominant, but the groups like US Companies with large investment in China and Wall Street are no longer defending China, and some have turned hawkish against China. These US companies are the main conduit in which China's lobby Congress, since China only spends 50% of what Taiwan spends lobbying Congress.
THE ANGLO SAXON WORLD AND CHINA
I don't think many Chinese even those that speak English, have a good understanding Anglo-Saxon society mindset. Anglo Saxons countries, whether US, UK, Canada, Australia, New Zealand and Ireland are commerce driven society governed by sanctity of contracts. The English great philosophical contributions to Western philosophy have primarily to do with economics and politics like Adam Smith, John Locke, David Hume and Thomas Hobbes. This contrast with the French and Germans. Politics in the UK and to a lesser extent the US, is centered around economics, while in Mainland Europe its religion. When the Americans revolted against the British Empire in 1776, the initial source of the grievances were taxes.
Outside of East Asia, the rest of the World's relationship with China was largely commercial, and for United States, being an Anglosaxon country, even more so. In Southeast Asia, Chinese aren't known for high culture, but for trade and commerce. Outside Vietnam, most of Chinese loans words in Southeast Asian languages involve either food or money. The influence is akin to Yiddish in English.
Some people point to the Mao and Nixon meeting as great strategic breakthrough and symbol of what great power politics should look like. The reality is that the Mao-Nixon meeting was an anomaly in the long history of relations with China and the West. Much of China-Western relations over the last 500 years was conducted by multitudes of nameless Chinese and Western traders. The period from 1949-1979 was the only period were strategic concerns triumphed trade, because China had little to offer except instability and revolution. Even in this period, China's attempt to spread revolution in Southeast Asia was a threat to Western investments and corporate interest in the region. During the nadir of both the Qing Dynasty and Republican period, China was still engaged in its traditional commercial role. Throughout much of history of their relations with China, the goals of Britain and the United States were primarily economic,
IMAGINE JUST 10% OF CHINA BOUGHT MY PRODUCT
From the beginning, the allure of China to Western businesses and traders has been its sheer size I. One of the points that the USTR mentions is lack of market access for US companies operating in China, while Chinese companies face much less restrictions operating in the US.
This is supported by remarks by Henry Paulson and Charlene Barshefsky. As Paulson remarked
Trade with China has hurt some American workers. And they have expressed their grievances at the ballot box.
So while many attribute this shift to the Trump Administration, I do not. What we are now seeing will likely endure for some time within the American policy establishment. China is viewed—by a growing consensus—not just as a strategic challenge to the United States but as a country whose rise has come at America’s expense. In this environment, it would be helpful if the US-China relationship had more advocates. That it does not reflects another failure:
In large part because China has been slow to open its economy since it joined the WTO, the American business community has turned from advocate to skeptic and even opponent of past US policies toward China. American business doesn’t want a tariff war but it does want a more aggressive approach from our government. How can it be that those who know China best, work there, do business there, make money there, and have advocated for productive relations in the past, are among those now arguing for more confrontation? The answer lies in the story of stalled competition policy, and the slow pace of opening, over nearly two decades. This has discouraged and fragmented the American business community. And it has reinforced the negative attitudinal shift among our political and expert classes. In short, even though many American businesses continue to prosper in China, a growing number of firms have given up hope that the playing field will ever be level. Some have accepted the Faustian bargain of maximizing today’s earnings per share while operating under restrictions that jeopardize their future competitiveness. But that doesn’t mean they’re happy about it. Nor does it mean they aren’t acutely aware of the risks — or thinking harder than ever before about how to diversify their risks away from, and beyond, China.
What is interesting about Paulson's speech is he spend only one sentence about displaced US workers, and a whole paragraph about US business operating in China. While Kissinger writes books about China, how much does he contribute to both Democrats and the Republicans during the election cycle? China is increasingly makING it more difficult for US companies operating and those exporting products to China.

CONTINUED

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