There are some more interesting differences between Forex trading and stock/index future trading. I will continue my discussion in this second instalment.
Many beginners choose to start their trading career with forex. There are also traders who switch to trade forex from stock trading or index trading. Forex trading has been the trading vehicle in Asia for many years. However, it just gains mass appeal lately in North America.
How different is it from stock trading or index future trading? That is what I am going to talk about from the perspective of an index future trader.
Stochastics is one of the most widely used technical indicators in the world. Surprisely, most traders like to modify the original indicator into something else because they find the original implementation too noisy.
I am going to show you a trading setup using the original Stochastics SlowK indicator that works very well on daily data across many stocks that I think you will consider re-examine this classic technical indicator once more.
Trading for a living requires a lot of discipline. It also requires a lot of streets smart if you trade discretionarily. One thing that many beginners missed is a basic concept of having multiple setups learned and practiced correctly.
Classic trading systems hold their positions overnight, subjecting themselves to the risk of price shocks caused by breaking news, and changing fundamental environment. Daytrading systems do not have any of these disadvantages, making it very sexy in comparison. Just imagine, sleep tight every night without worrying about overnight positions at all is a good enough reason to pursuit this dream. But what about the pitfalls associated with daytrading systems?
We now know that moving average can be measured more effectively when average bar range is used as the yardstick. How do we utilitize this information?
Many traders talk about ATR which stands for Average True Range, but from time to time you see indicators and technical analysis based on the Average Range, AR. So what’s the difference and which one is better?
If you do not believe in using or working with trading systems, then naturally you are a discretionary trader. As a discretionary trader, it takes a lot of time to learn the art of trading and many beginners fail because they do not know enough basic knowledge to get started. Before these beginners even get a chance, they are already wiped out by the markets they trade. For most beginner traders, this question almost always pop in their minds at least a few times – should I find a mentor?