How TrendyLines and Channels
Besides the ubiquitous horizontal support and resistance lines touched upon earlier in this chapter, trendlines and channels remain among the most utilized weapons in the technical analysis arsenal. There are almost as many ways to draw trendlines as there are traders using them in their analysis. Over time, there have also emerged countless new methodologies for drawing and interpreting these lines. But the traditional manner of constructing trendlines remains clear and focused. One would...
Market OrdersOn the Spot
Depending on the specific strategy or type of trading preferred, foreign exchange traders often rely heavily upon market orders. A market order simply means that a trader wishes to enter a currency position at the present moment, whether it is an order to buy long or sell short a specific currency pair. The main functionality that differentiates this type of order from others is the fact that a market order is executed at the current market price, as opposed to a future price level. Market...
No News Is Bad News for News Traders
With economic news and data coming out of the United States and other countries on an ongoing basis, foreign exchange traders who truly strive to be successful, regardless of whether they are primarily technical or fundamental strategists, must necessarily be vigilant of scheduled economic releases and current events. Fundamental forces affect currency prices too thoroughly to ignore. But when traders concentrate all of their attention on news and economic data to the exclusion of other...
Chapter Summary Aal
Fundamental analysis is essentially the study of why markets move, or, more specifically, what drives them to move. The primary drivers in foreign exchange, like that of other financial markets, are the basic economic concepts of supply and demand. If there is high demand for and or low supply of a currency, its value should go up. Conversely, if there is low demand for and or high supply of a currency, its value should go down. In turn, supply and demand are driven primarily by traders '...