Financial Future

Cartography of possibilities is the process, which will prepare your thinking for expectation of improbable, so, it will allow you to put the barrier to any emotional reactions. If you have decided to devote your life to trading in the Forex market, it is necessary to get more information about methods of trading and about different useful tricks, which could make your trade more profitable. Cartography of possibilities is one of such tricks. Go on reading…

There are two basic types of cartography of possibilities. Exact cartography of possibilities, which should be used if you try to make trading decisions one day earlier; and cartography of possibilities of price models – when you make trading decisions at supervision over formation of models of the price. You should choose yourself what kind of cartography is better for you or to try to apply both of them.

In case of exact cartography of possibilities you, at first, define the transaction, which you wish to make. Then you write out all possible scenarios of movement of the price after your entrance into this transaction. Certainly, there is bigger quantity of scenarios, than you can define. However, it is necessary to identify the basic groups of scenarios, where each of scenarios in the given group finally would end with the same signal. These groups are limited and can be easily defined. Then you should solve how it is possible to react in each case. When you apply this method you will be ready to different situations and will decide in advance how it is possible to react on one or another situation.

On the other hand, in case of cartography of possibilities on models, you define some possible groups of models of a general view, which you can see and solve, what actions should be undertaken in each specific case. After some time you will plot possibilities faster and more precisely. You can go and further, defining what you could think, when these possibilities will occur actually. Don’t forget to write down all your thoughts into diary. Don’t think that it is very easy to make so much detailed plan of your actions and possible situations – it is quite difficult. But you will see that this method will help you to trade more profitable.

By such preparation you will live the tomorrows market the day before. In this case you actually eliminate possibility of overstrain because of unexpected scenarios. The cartography of possibilities can also improve quality of your trading decisions and an identification of some models. Besides, reconsidering and comparing former possibilities to your trading diary, you can find key models in the trade; define areas in which you are insufficiently prepared, and spheres in which you are strong. Good luck!

It is vital to gather as much info about Forex market as possible. Because this knowledge will help you not to lose much money on Forex trading or Forex investment.

Surely not a single piece of knowledge can be rock solid guarantee against losses, especially on Forex market, but sometimes even one Forex books can save you much money.

The most serious problem of many beginning traders – a discipline lack. Instead of following to the transaction plan many beginners lose the control. They impulsively refuse the plan, reaping the fruits in the form of changeable profit, and more often serious losses. Psychologists concern discipline as to “the impulsiveness control”. There are some classical researches, which illustrate as people can strengthen the ability to operate impulses.

In original research of the control of impulsiveness doctor Walter Mischel with colleagues has studied children’s ability to postpone compensation. Like many children, participants were a little hungry, and they were offered to have snack bagels. To receive a bagel, it was required to press only the button and the laboratorian will bring the order. But there was also a dirty trick: if they have waited, without giving in to a temptation to call, they could receive many bagels, delayed, but more desirable award. In this research are interesting situational and psychological factors of how long the child could detain compensation reception. The first factor – visibility of the award, either it was directly in front of the child or has been hidden. Predictably, it is difficult to postpone compensation if bagels are in front of you. Children could not wait. When the meal was directly in front of them, they preferred to eat one bagel at once, than to expect some of them then. This conclusion is especially applicable to trading. In trade it is considered not too reasonable to supervise a transaction course constantly on the screen. Some traders say that it in many respects like the playing automatic machine. It simply tempts you to play, when actually you need to wait only for a signal on an exit. If you have a problem with the impulsiveness control, you should avoid looking at the screen, when there are no urgent reasons to supervise the transaction. For struggle against impulsive temptations it is possible to use automatic orders of your trading platform.

For strengthening of the control of impulsiveness it is possible to use thinking strategy also. For example, doctor Mischel has found out that children could abstain from desire to eat bagels if will change the point of view on them. If they thought of bagels as about meal, they would like to eat. But if they represented bagels as wooden or plastic wheels, it was much easier to restrain. This trick also can be used into trade. One of the main reasons forcing beginning traders to refuse the plan of trade consists that they consider the capital invested in the transaction, as real money. They think what they could buy on this money. But it is better to concern the capital so abstractly, as far as possible. It is better to see in it percent or only figures, which do not concern something material. In this case it will be easier to keep discipline. Also, as children can abstain from bagels if do not see meal in them, traders can avoid to operate under the influence of fear and greed if do not see the cars hidden in the capital, luxury goods or houses. The more you abstract from the money invested in the concrete transaction, it will be easier to trade.

If the impulsiveness control is a problem for you, do not lose hope. There is strategy, which you can use to raise your ability to keep discipline: avoid unduly often looking at the screen and as much as possible abstract from the transaction. Never forget to follow a detailed plan. Learn to trade correctly and you will achieve long-term success of the winning trader.

It is important to gather as much info about currency exchange market as possible. Because this info will help you not to lose much money on Forex trading or Forex investment.

Surely not a single piece of knowledge can be rock solid guarantee against losses, in particular on Forex, but sometimes just one Forex books can save you much money.

The Japanese candles represent «mathematical expression of psychological market moods» for the trader of Gary Wagner, using these east technical indicators in a combination to the western tools in interests of the active trading.

Gary Wagner has studied in commodity business some years before has started to use the Japanese candles at interpretation of the markets. Upon termination of college it has come to branch as the broker, and as he tells, «in 1989-1990 Future Source has started to show price range concerning time by means of candles. It seemed interesting, but I did not imagine especially what they meant. It was necessary to attend to extensive researches». Book of Seiki Shimizu under the name The Japanese Chart of Charts which he names «the alphabet for each technician in the USA. I have read it and as though have begun to see clearly. After I have understood it, my trading immeasurably has improved. I have started to earn money, and my clients have started to earn money too».

The Japanese candles differ from the traditional western histogram. The usual daily histogram shows the vertical strip representing results of one day. On the histogram are shown high, low and the price for closing of trading sessions, and last it is shown by a tic to the right of a strip.

Unlike it, the Japanese candles represent a rectangular cut with two thin lines over and under it. As they say in the book of Gary Wagner and Brad Matheny in the book Trading Applications of Japanese Candlesticks, «candle, or polar, the line is advanced as one complete cycle, with the prices at opening, low, high and closing. The thick part of a candle is known as really body. Thin lines over and under a real body are called shades and represent high and low for the given cycle … the White candle (empty) is received, when for the given cycle a rate on closing hardly above a rate at opening. Black candles (complete) represent opposite – high rate at opening should be above close the prices for a cycle ». Gary Wagner, however, uses the Japanese candles in a combination to traditional methods of the western technical analysis.

«Use of candles is a sure thing for the western technician. We use sliding average, stochastic, lines of trends. But usually more information can be received, having looked at a candle. The reason in that the western technician places emphasis on the prices between two closings», — notices Gary Wagner.

However candles show «dependence between the price at opening and closing for the given day. In dynamic sense, every day there is a fight, and the candle shows its result». The Most important result which Gary Wagner has acquired as the trader, consists that «the market develops irrespective of, whether it would be desirable you that it went uphill or fell … It is impossible to become attached to one item. It is necessary to have the systematized methodology which in the greatest possible degree would supersede emotions from trading ». Besides, he underlines necessity for traders in advance to be advanced in the sizes of risk and profit.

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If to ask trading experts, they can depict characteristics of the ideal trader as follows: intuitive, but logical and objective; spontaneous, but also disciplined; assured and opened for criticism. People can be inherent traders, if they have these qualities by nature. Do you believe that it is possible to be born as a trader? Or do you consider, that it is possible to teach the majority of people to trading if to spend enough time and forces for training? Irrespective of your thoughts, your opinion can vary about it how you approach to studying of trading and how much you are tolerant to trading costs.

Psychologist Carol Dweck has spent some researches showing that our assumptions of certain ability, for example, concerning skills of trade, powerfully influence our interpretation of events and reaction to them. The person, who believes that people are born as traders, concerns the first group. Such belief involves essential consequences. If someone is convinced that he is inherent trader, he puts to himself the high efficiency purposes. It occurs subconsciously. People who believe that they have natural propensity to trade, try to take advantage of the talents. If you would be the virtuoso, you, probably, also would use the skills and would reach the higher results. Such way of thinking works perfectly, when it is realized one profitable transaction after another, bringing huge incomes. Expectations prove to be true and to shake them it is required substantial losses. In such situation it seems that you just cannot make something wrong, it occurs a belief in natural abilities to trading. But, unfortunately, market conditions changes, and you haven’t constant profits any more. When it occurs, results of work cease to correspond to representation about themselves, as about inherent traders.

Much more correctly to consider abilities to trading, as something what you can learn. In other words, it is more useful to believe that people are not born as traders. When we consider trade as discipline, which you can learn with the help of practice and efforts, failures are seemed only as an objective feedback, but not as an estimation of the natural ability to trading. Such people are not anxious by obligatory achievement of the purposes of high efficiency; they concentrate only on process of development of the skills. Despite of failures, which they face, they continue to go persistently forward. They believe that finally they can develop high level of skill, but for now they concentrate on process of studying of trading, and accumulate experience as soon as it is possible.

Are there inherent traders? It is a disputable question. It is not useful to believe that there are inherent traders. Such belief will bring more harm, than advantage. It is much better to believe that any person can learn to trade, if will make sufficient efforts. Believing that you can master trading with the help of practice and experience, you show persistence, even when you face failures. And, eventually, you will develop skills of consistently profitable trader.

It is a must to gather as much knowledge about Forex as possible. Because this info will help you not to lose much money on Forex trading or Forex investment.

Surely not a single piece of knowledge can be rock solid guarantee against losses, in particular on Forex, but sometimes just one Forex books can save you much money.

Well, it is unbelievable, but many individuals actually do not utilize so called forex exit trading strategies in their currency trading systems. And thus if you had to break some forex system down to its different components, many foreign currency traders are going to argue that the most essential parts and elements of a foreign trading system and any other type of trading system for this matter are its money management and its exit strategy.

For sure, all the other parts and components of a trading system are important and essential as well, for example like those instruments which are traded, the entry rules and also those time frames which are utilized. However, that exit trading strategy in particular can truly determine the current success of the system.

Well, what exactly we are going to talk about in our article are several important things which you need to know about such exit strategies. And so if you actually understand all those points, then you are going to be able to pick up more quickly the skills and also rules when learning some new foreign currency trading system.

First of all, trailing stops are number one type of exit strategy which is used in all forex trading systems. Of course, their key purpose is to really protect profits. And they certainly do this in two ways, so they let enough space to breathe, so that some minor fluctuations in the current price are not going to stop you out of your trade and thus let profits run. This is very and very important.

Second, they are actually trailed upward in a long trade, thus truly protecting your possible profits as your trade really goes in your direction and also eventually exits you from your trades when they go against you. However, in general, such trailing stops clearly do not go backward and this is for long trade is obviously back down, because if they really did, they are no longer going to protect your profits.

In addition, initial stops are very important and essential as well in all forex trading systems. Of course, the main purpose of the initial stop is to actually get you out of your trade if it clearly goes in the wrong and improper direction just near the beginning of your trade. Thus in general, many trading systems definitely have both the initial and also initial stops. However, the trailing stop may obviously not be known until later in your trade, when some trough and peak has really formed, thus causing such trailing stops to be placed. And finally, in some trading systems this kind of stop is definitely based on price movements and some technical points.

It is vital to gather as much knowledge about currency exchange market as possible. Because this knowledge will help you not to lose much money on Forex trading or Forex investment.

Surely not a single piece of knowledge can be rock solid guarantee against losses, in particular on Forex market, but sometimes even one Forex books can be of big service to you.