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Trading False Breaks Print
Written by Site admin   

Non Farm Payroll, NFP days, are well known for surprises and violent whipsaws.

False break outs are either the bain of the Forex traders life or one of the best trading opportunities available. I go with the latter view, I'm seldom comfortable with breakouts as there is a very high probability of false breaks so I like to be on the look out for failing breakouts as the probability of a move against the previous trend is higher.

Trader Vic, Victor Sperendeo, detailed the 2B false break in his 1991 book 'Trader Vic, Methods of a Wall Street Master' Take a look at the picture below.

This is how to trade them, see the chart and desciption below....

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Four Poisons of the Mind Print
Written by Site admin   

Deep Survival: Who Lives, Who Dies, and Why by Laurence Gonzales (published 2004, W. W. Norton & Company) has many lessons for traders and here is one of them:

There is a Korean martial art called Kum Do. This is a brutal game that involves a fight to the death with very sharp swords. The way it is practiced today is with bamboo sticks, but the moves are the same. Kum Do teaches the student warriors to avoid what are called “The Four Poisons of the Mind.” These are: fear, confusion, hesitation and surprise.

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Hammers and Shooting Stars Print
Written by Site admin   
Sunday, 19 April 2009 18:46

One of the very best Candle patterns is also the simplest to identify. The Hammer looks a little like one, it has a long lower wick/tail/shadow with a small head. Ideally, it is an up Candle, where the close is higher than the open, but that's not vitally important.

There are two important qualifiers. Firstly, it needs to be found in the right place and there also needs to be evidence of involvement. A Hammer is a reversal Candle, but only when it is found after a decline. At number of prior down bars must precede it. The second qualifier is involvement and that can be seen from observing the volume on futures or stocks, or tick activity with Forex charts. The higher the volume plot the better, but it should be at least greater than the average of the last three plus bars. Why is this? read on...

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From the blog

Hawk or Dove to replace Janet?

Is Janet Yellen a Hawk or a Dove?

We never really found out what she truly belived. She was both at times and while she was a Hawk telling us she was "minded to tighten rates", Donald Trump was a Dove, saying he wanted a weak dollar so interest rates would have to remain low.

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