Saturday, June 28, 2014

What´s Better For Technical Analysis in Forex, Candlesticks or Bars?

By Ronald Fallas Bermúdez (@davefbtrader)
People around the world discuss the fact of what is the best  type of chart to trade with, the real question is, what type of chart do you feel more comfortable to trade with?
In both we can observe important points of reference as the high/low, open/close but a little advantage in candlesticks is the facility to understand these parameters of a graphical way, in bars is a little more confusing, i learned to difference between positive or negative bars because the positive one has a ¨S¨ shape while the negative one has a ¨Z¨ shape, then i discovered that in MT4 platform is possible to use different colors in both types of bars, however the candlestick themselves are more attractive to your view, you can also personalize them to your color of preference.
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Nowadays candlesticks has become the favored tool to analyse the market of a quick and easy way but we note that the data used by these two different analysing tools is the same, they both show the 4 basic parameters in their shape which are Open/Close, High/Low or OHLC as normally known, so why do we prefer the candlestick chart?
The difference is in the way they display the opening and closing prices, also the candlestick emphasizes in the previous day closing price to show the current closing price, but the bar chart emphasizes only in the current closing price.
If you compare both in the same chart and time frame you probably note that is much easier to point and detect the trends and reversals in the chart using Japanese candlesticks than using American bars.
The strength in the American bars chart Born’s in making the traders look at the difference between day to day closing price that will actually make you go deeper in the chart study for detecting possible patterns in the current charts.

In conclusion we just showed that both candlesticks and bars have their advantages and if you´re using candlestick charts it will not be bad to take a look at the American bars before pulling the trigger and open a trade and the same way with the bars, if you´re using them consider to take a look in the candlesticks can maybe detect something that the bars didn´t tell you and you can maybe avoid a premature entry or a loss.

A Single Man Army in Forex Trading

Why Forex trading is a one man business?

By Ronald Fallas Bermúdez (@davefbtrader)

Nowadays after many lessons i´ve learned many things about trading, you never stop of learning not only from the charts but the money management, the analysis of your emotional state and may other things, this times i think that been a trader has two difficulty levels, having what you need to trade is much easier i mean of an account, computer, Internet connection, information, books, professional indicators, but the thing is that been a trader perse is not quiet simple and i consider that is harder than a few years ago, now the information is so much that we cannot focus in one single technique, indicator, system at time, you see traders with 8 or more indicators in their charts, 4 or more screens, smart phone with many information but the thing is that is much more that what we can process at a single time, we must know that older traders started calculating fibos, stochs and many other by hand and drawing the results in paper or observing the market through a 12´´ CRT screen and they made money, now what we must think is that this days we have so much and we do so less that we can get live charts and indicators a click of distance and its amazing how easy is but how much difficult is making money these days.

One of the things that brought me to forex trading was my ego, i´m a good team worker but if i ever start a project that involves a self employee and starting a business i didn´t want to work in a team, i just wanted to be me and no one else.

That means for me that if i made a mistake no one would be involved, if i was successful no one would ask me to share the credit because people used to celebrate your success but never celebrate fails, i didn´t want to deal with nobody, so i started by myself and i´m still alone in this business because that make feel safer and i can trust that nobody will go against my analysis.

As a one man army i recommend you to trade this way, at least during the time that you´ll be growing up as a trader, then eventually you can find a mentor or contrary you can teach someone or trade with other people´s money, but i always think that trading is a single man business, at the end of the day you should decide how are you going to trade and who are you going to deal with.

Basically Forex Currency trading is one man business because it nature of the way of understanding the charts that change in multiple ways depending of the person, you cannot pretend to trade in the way that a friend of yours trade because you´re going to find many aspects of his trading that goes against your trading ideals, every mind is a world and we all see the charts in many different ways that we will never be agree in our predictions. My advice, learn all the good things from the other traders but always try to maintain your principles because that is what make you be a single trader, if you go with the collectivity you maybe be part of these that think they can handle the market, be smart and go against the ignorants and in favour of professionals but keeping always your trading principles.

A good friend of mine told me one time that if you find a forex guru, he probably tell you his point of view and he´s 100% secure that his ideals are the right ones, maybe he will be right, maybe not, but that doesn´t make him immortal in the markets, that is why they reign the market for a couple of months or years but one day or another their system fails and they disappears as well as their fame.


Friday, June 27, 2014

Are You a Humble Forex Trader?

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Are You a Humble Forex Trader? (A lesson of trading humility and knowledge)

By Ronald Fallas Bermúdez (@davefbtrader)
When i first start in forex, after a few years of being one more piece of my country´s work system, analyzing what was my needing and how would i pursuit my happiness, the only thing that came to my mind was that if no one else trusted in my idea of becoming a professional trader, i would become a single man army of forex trading, my dream was so simple, taking a couple of hundreds of USD, open a real trading account, learn to trade in the way to financial freedom while i was working as a sales man at Pepsico Foods in my country, i was 100% sure that my dream was going to be done, i started with a couple of hundred, exactly $250, and the first mistake was taking the money from my credit card, it was money that i couldn´t spend, and i was literally giving it to the market, i started anyway because i didn´t know the market and i didn´t know how cruel and cold it is.

I actually after three week of trading, no stop loss or take profit orders, just buying and selling because i wanted to go short or long, i really though that it was actually working because after one month of trading that way i convert my $250 in $674 almost three times my fist investments, i literally was a pip making machine, i will never know if my good results were because my ignorance of the market dangers or just a lucky shot but i can make you sure that these amount of pips in that time i actually couldn´t repeat it again, i´m still thinking about what i did to make these profits.

After a couple of months of trying to increase my trading account i realized that trading was more than entering trades and Wait for a profit, the market always recover what you take from it and even more, specially when  you don´t use stop loss, after a few trades against my direction, i loose my whole trading account and a margin call from a broker brought me back to the real life, i had only $66 in my trading account, now my plans changed in 360 degrees, i owned $250 which was pretty much for me because my economic situation wasn´t good and now i neither had the money in my trading account, i lost everything after a few weeks of trying to recover my money by trading of an aggressive way as a form of revenge.

Now i learned the lesson and my trading is much more secure than a couple of years ago, i don´t loose too much to loose my account and i don´t risk too much too but the thing is that you cannot pretend to know everything without having the capacity and patience to learn and self analysis to see what´s wrong with you. I was blind by the good results of my trading that i though that i wouldn´t need to learn more but eventually the market showed me that i was just an ignorant trader pretending to know everything by trading during a few days.


Thursday, June 26, 2014

Why Discipline = Success Forex?

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The Discipline (The most important Indicator/Money Management tool in Forex)


By Ronald Fallas Bermúdez (@davefbtrader)

After a couple of years of improving my trading system i recently finally found the perfect balance between money management and a profitable system, the thing is that i´ve been trying to test it but result that i couldn´t control myself from following my trading system rules, i finally discovered that my system was not the problem, i actually developed a couple of more effective trading systems on the road, but me trading was the biggest bug on my system, i´m a disciplined man but when we´re talking about trading, i´m  a mess so i decided to do something else, i´m starting to train my brain and i´m reading a book about emotional trading, but i think that this is not enough, the big answer is How can i run away from me? I´ve been surrounding this situation and this trading problem many years, the thing is that in my interior i knew that something was wrong with me and my way to trade the market, but in the mid time i was inventing different excuses to avoid confronting myself. 

In retrospective it looks so easy to change my mind but if you are a trader and you understand why i´m touching the theme you probably know that it is not easy at all, you can spend years trying to deal with your impulse trading and blaming your trading system and your broker but the thing is that your problem can be inside of you, so i´m also working on a  mql4 manual because as a second alternative plan i´m thinking to is building an expert advisor based on my trading system will make me feel more unable to break my own rules, that may be a crazy idea reminding that i don´t trust EAs but i´m not talking about a forex miracle robot but an advisor that follow the rules for me, so the EA will not let me trade if the necessary conditions are shown by the indicators, i will be posting what i´ve learned on both sides of my plan, the emotional control and mql4 programing.

Tuesday, June 24, 2014

My Story Starting In Forex Trading

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I´m Ronald David Fallas, a 23 years old guy from San José Costa Rica with an unique dream in my life that is becoming a professional currency and stock trader, i want to be recognized as an important technical analyzer in the world of financial markets, travel to wall street and meet many traders of the world, during the last four years i´ve been collecting and analyzing many information and tools that i´ve found around the Internet and i´m actually building a website to help new traders to take a shorter way to financial freedom and success in forex market trading, my forex website is based in everything that a trader needs to start trading the market and the necessary information to get success, you can take a look @ www.tradingoptions.tk and discover what i´m doing there.

Meanwhile this is going to be a kind of record where i´m plaining to register anything that happens to me and my trading project during my road to success, with this i´m plaining to write a guide for starting and finally finish with the scams and bad forex marketing systems that promises new traders to become millionaire in a few days, i don´t really care if you have money, you´re maybe an engineer or another proffessional worker that actually makes good money and can invest in whatever you want, is your money and you can do whatever you want with it, my concern is about the people that maybe is unemployed like i am or maybe doesn´t have or earn enough money to invest and risk in the market and maybe they use their credit card or ask for a loan to trade and eventually loose money that the couldn´t loose, i´m tired of that and my concern is because i was one of these people, fortunally i just loose a couple of hundreds of USD but in a daily basis there are thousands of people loosing thousands of USD that they literally cannot loose because many reasons.

That is the main reason because i´m working on this project, another is because i consider myself a non ordinary worker, i worked so hard this past years but even if you sacrifice many things in your life and go beyond your responsibilities in your job, nobody is going to thank you because you´re just a piece of a thousand pieces puzzle, maybe a million parts puzzle so i literally want to be a single man army, that is why i want to create the perfect system, to go and defeat the market and make money of it, i want to trade for a living but i don´t want to live for trading even if i love it.

This is all for the moment, i will be updating my blog in the next couple of days hope that some people feel identified with my case and maybe we can share experiences, for info or maybe share your own forex experience please mail me at fxtraderdave@aol.com  and remember to visit www.tradingoptions.tk for info and good tips and tools. Later @davefbtrader