Education on Forex trading and financial markets for beginners and professional traders interested in earn money trading
In a previous article we explained some basic day trading strategies for Forex and other markets, mainly based on price action.
Continuing with the series on daytrading strategies based exclusively on Price Action (the most common price patterns), we are now going to present another series of strategies based on classic price patterns of technical analysis.
You can access the first article in the series at the following link: The Best Forex Daytrading Strategies I
A recession is a decrease in economic activity over a period of time. Officially, a recession is considered to exist when the GDP variation rate is negative for two consecutive quarters. It is also known as a period of economic contraction.
The economic recession is the phase of the economic cycle in which economic activity decreases, consumption and investment decrease, and unemployment increases.
In the following chart, we can see an example of a recession, with two-quarters of negative growth. If the negative growth continued, it would be a long economic recession. However, if the negative growth were to occur for only one quarter, we could not officially consider that decrease as an economic recession.
A financial option is a financial derivative that involves a contract to buy or sell an underlying asset, such as a stock, currency pair, commodity or other, which grants the buyer the right to buy or sell the agreed underlying asset at a future date previously agreed, depending on whether it is a call option or a put option.
The main characteristics of an option are indicated by its own name. The term ‘option’ refers precisely to the fact that the buyer of this financial derivative has the right (has the option) to execute the provisions of the contract. At the same time, the seller of an option is required to buy or sell (depending on the type of option) if the buyer exercises his right once the contract expires.
The Euclidean Attractor is a fundamental model for managing timings and achieving optimal entries. We will divide the explanation of its operation into three parts for its perfect use. They are as follows:
A reserve currency is the one used as a means of payment in international transactions due to its confidence. In other words, investors expect their value to be maintained over time. Currently, the dollar is the currency that mainly meets these characteristics.
An important part of the international reserves of each country is denominated in some reserve currency. The bodies responsible for pursuing this objective are the central banks.
Reserve currencies also serve to set the prices of commodities such as oil, gold, and other raw materials. The same happens with financial costs and international transport.
An efficient market is one in which the prices of the assets traded in it reflect at all times the information available on the market.
Financial asset prices react strongly to market information. When the information is released, the different market agents analyze it and use it to make decisions. So this information is incorporated into the price as it arrives.
Therefore, the more information on the market, the greater the efficiency of prices and the greater reflection of the fundamental value of assets. In this way, an efficient market can be considered as a market in which assets are quoted at their fair price and this price also truly reflects their real value at all times.
The Non-farm payrolls (NFP) indicator is the report on total salaried workers in the United States except agricultural jobs, government workers, nonprofit workers, and private domestic workers. Today it is a key economic indicator for the United States.
The publication of the NFP report causes very wide movements in the Forex market, which are among the largest movements produced by the publication of economic news. This is why many analysts, investors, speculators, and investment funds try to anticipate the result of the NFP and the movement it will cause. Due to this great expectation before the publication of this economic indicator, the market can react with wide movements even when there is no deviation between the forecast and the final result of the NFP.
In this article, we are going to discuss some trading aspects related to this economic indicator, especially to avoid the exposure to excessive risks due to the high volatility that the release of the NFP can cause.
The “International Trade & Trade Balance” is an economic report that measures the difference between imports and exports of goods and services in countries like United States. Imports and exports are important components of accumulated economic activities. Furthermore, representing 14 and 12 percent of the gross domestic product in the United States, respectively. Normally, increases in exports are positive for corporate profits and also good for the stock market. Changes in the trade balance with particular countries may have implications in the monetary policy with respect to those countries for which this report is important for investors who are interested in diversifying their investments globally.
Investment in the stock markets has historically been very profitable. During the twentieth century in almost any decade buying equities proved to be a good strategy to preserve purchasing power. However, very few investors in that period will have obtained exactly the results that the market averages show.
When we talk about the evolution of the stock market and markets in general, we almost always refer to some index. This index is usually made up of a number of companies and aims to represent an important segment of the market. For example, the S&P 500, one of the most followed indices in the world, represents the equity of large companies in the United States. Its evolution is closely linked to the evolution of the US economy and companies.
Today we live in a very globalized world, and financial markets are increasingly interconnected. In the same way, more and more investors are observing global indices that seek to reflect the evolution of the economy worldwide.
The trade war between the United States and China has lived its nth chapter, with the establishment of new tariffs between the two countries, for tens of billions of dollars.
Donald Trump and Xi Jinping continue to fight a battle that involves not only a commercial pulse between the two largest economic powers on the planet but also a fight for global supremacy, for the ability to influence throughout the world.
Naturally, this struggle between the two superpowers, which agglutinate 40% of the world’s GDP (another 20% corresponds to the European Union), affects not only both contestants, but also has multiple and varied effects on other economies. And more if we take into account that together with the increase in tariffs, we have a currency war, more or less buried.