Betyr Trippel Skjerm Trading System Arbeid

Triple Screen Trading System - Del 7 Det tredoble skjermhandelssystemet kan godt illustrert med en havsmetafor. Det første skjermbildet i tripplesystemets handelssystem tar et langsiktig perspektiv og illustrerer markedsvannet. Den andre skjermen, representert av en oscillator. identifiserer mellomlang sikt som går mot tidevannet. Den tredje skjermen avgrenser systemet til det korteste målet, og identifiserer krusninger som beveger seg i retning av tidevannet. Dette er kortsiktige intradagprisbevegelser som identifiserer inngangspunkter for dine kjøps - eller salgsordrer i løpet av handelsdagen. Hvis du trenger en oppfriskning, sjekk ut Triple Screen Trading System - Del 1. Del 2 og Del 3. Heldigvis, for de av oss som har blitt slitne på tolkediagrammer eller tekniske indikatorer i første og andre skjerm, trenger ikke det tredje skjermbildet noen ekstra teknisk talent. I stedet gir den tredje skjermen oss en teknikk for å plassere stoppordrer. enten kjøpe stoppordrer eller selg stoppordrer, avhengig av om de første og andre skjermbildene leder deg til å kjøpe eller selge kort. Nærmere bestemt kalles den tredje skjermen en trailing buy stop-teknikk i opptrender og en etterfølgende salgsteknikk i nedtrender. Når den ukentlige trenden er opp (identifisert ved første skjerm) og den daglige trenden er nede (identifisert av den andre skjermen eller oscillatoren) Når den ukentlige trenden er nede og den daglige trenden er oppe, stopper etterspørselen med å få tak i nedadgående utbrudd. Hver situasjon fortjener ytterligere undersøkelse. Trailing Buy Stop Technique Når du har identifisert at en langsiktig (ukentlig) trend går opp og din middels (oscillator) reduseres, aktiverer trippelsystemhandelssystemet en etterfølgende kjøpstoppteknikk. For å opprette den etterfølgende kjøpstoppteknikken, legg inn en kjøpspakke ett kryss over høyden av forrige dag. Deretter, hvis prisene går, vil du bli stoppet til en lang posisjon automatisk på det tidspunktet som rallyet overstiger de forrige dagene høyt. Hvis imidlertid prisene fortsetter å avta, vil bestillingsstoppet ditt ikke bli rørt. Denne teknikken gjør det mulig å stoppe inn i bestillingen din dersom kortest ripples har tilstrekkelig moment for å drive bølgen i større tidevann. Kjøpsstoppet er derfor nært knyttet til det som de fleste handelsfolk vil merke som et momentum som investerer. Imidlertid gir bruken av alle tre skjermbildene i tripplesystemets handelssystem et mye mer detaljert og raffinert bilde av markedet enn det enkle konseptet av momentum generelt gir. For videre lesing, se Introduksjon til Momentum Trading. Hvis du vil ytterligere forfine den etterfølgende kjøpstoppteknikken, kan du senke kjøpsordren din neste dag til nivået ett kryss over den siste prislinjen. Fortsett å senke kjøperstoppet ditt hver dag til du har stoppet (fylle bestillingen din på aller beste tid) eller til din langsiktige (ukentlige) indikator reverserer og kansellerer kjøpesignalet (sparer deg for tap). Årsaken til at buy stop-teknikken er prefaced av den etterfølgende kvalifikasjonen vedrører denne flytende karakteren av buy stop order. Du må imidlertid være årvåken i å overvåke markedets momentum. og du må være flittig i å fortsette å flytte ditt kjøp, stopp til ett kryss over den siste prislinjen. Prosessen kan være arbeidskrevende, men det vil sikre at du enten fyller bestillingen din til den aller beste prisen eller unngå en dårlig handel helt hvis markedet ikke klarer å bevege seg. Trailing Sell Stop Technique Den motsatte situasjonen oppstår når den langsiktige (ukentlige) trenden er nede, da vil du vente på et rally i mellomlangsiktig indikator (oscillator) for å aktivere en etterfølgende salgsteknikk. I den etterfølgende selger stopp teknikken. du bestiller å selge kort ett kryss under de nyeste barene lavt. Når markedet slår seg ned, vil du automatisk bli stoppet i korthandelen din. Hvis imidlertid markedet fortsetter å samle seg. Du kan fortsette å heve din salgsordre på daglig basis. Tvert imot den etterfølgende kjøpstoppteknikken, er den etterfølgende salgssteknikken ment å fange en intradag nedadgående breakout fra en daglig opptrinn. Som du kan se, beveger intraday downside breakout i retning av markedsvannet, som i dette tilfellet er en ukentlig nedtrend. Den etterfølgende kjøpstopp og etterfølgende salgstoppteknikker er de endelige forbedringene til det som allerede er et ekstremt kraftig handelssystem innenfor de to første skjermbildene på de tre skjermene. Ved å bruke en mindre utviklet indikator, vil mange begynnelseshandlere engasjere seg i et system med etterfølgende stoppordrer når de forsøker å måle markedets momentum. Ved å bruke et langsiktig diagram og en mellomlangsiktig oscillator først, kan du kapitalisere på de kortsiktige markedsrippene som du gjør de beste handler som denne intradagen tillater. Neste del av denne serien vil bringe trippleskermen handelssystemet til slutt. Reisen gjennom alle tre skjermene har vært lang, men resultatet er absolutt verdt det. Hvis du er i stand til å implementere det tredobbelte skjermhandelssystemet fullt ut, er du på vei til å være foran mange andre næringsdrivende med hvem du konkurrerer om for fortjeneste. For å lære hvordan trippelsystemhandelssystemet faktisk hjelper en handelsmann til å sikre en fortjeneste og unngå betydelige tap, gå videre til Triple Trading Systems - Del 8. Frexit kort for quotFrench exitquot er en fransk spinoff av begrepet Brexit, som dukket opp da Storbritannia stemte til. En ordre som er plassert hos en megler som kombinerer funksjonene til stoppordre med grensene. En stoppordre vil. En finansieringsrunde hvor investorer kjøper aksjer fra et selskap til lavere verdsettelse enn verdsettelsen plassert på. En økonomisk teori om total utgifter i økonomien og dens effekter på produksjon og inflasjon. Keynesian økonomi ble utviklet. En beholdning av en eiendel i en portefølje. En porteføljeinvestering er laget med forventning om å tjene en avkastning på den. Dette. Et forhold utviklet av Jack Treynor som måler avkastning opptjent i overkant av det som kunne ha vært opptjent på en risikofri. Slik bruker du riktige enkle bevegelige gjennomsnittsverdier for Stock Timing En av de største utfordringene investorene står overfor, er å finne ut når det er riktig tidspunkt å kjøp eller selg en aksje De fleste vanlige investorer har ikke sofistikert teknisk analyse (TA) verktøy for å hjelpe dem med å bestemme den tekniske helsen til deres favorittlager. Selv om TA-verktøy som Metastock. Quotetracker eller eSignal er tilgjengelig, det rene antallet og kompleksiteten til noen av de tilgjengelige tekniske analyseindikatorene fører til en viss form for analyse-lammelse. Sluttresultat, ikke overraskende at investorer blir distrahert fra det primære målet om å finne de optimale entryexit poengene for å kjøpe eller selge sine aksjer. Innføring av et enkelt system for å identifisere aksendrendenser Det du vil bli introdusert her er en tilpasning av et av de mest effektive handelssystemene, først avslørt av Dr. Alexander Elder (forfatter av Trading for a Living), kalt Triple Screen Trading System. Vårt tilpassede system vil bruke Simple Moving Average (SMA) som en del av Triple Screen Trading System, sammenlignet med originalen som er basert på ett av følgende: Stokastikk. MACD eller RSI. Hele premissen til dette systemet er ikke å stole på en enkelt indikator fordi ingen enkelt indikator kan være effektiv hele tiden. Bruke flere variasjoner av en indikator, f. eks. forskjellige tidsrammer eller perioder, vil bidra til å skape en mer robust og pålitelig handelsmetode. Hvordan å redusere lag i bevegelige gjennomsnitt Enkle bevegelige gjennomsnitt (SMA) er noen av de mest populære og vanlige tekniske indikatorene som brukes av både profesjonelle og nybegynnere. Flytte gjennomsnitt er generelt kjent for å være forsinkende indikatorer, og på en eller annen måte synes ordet enkelt i SMA å ha negative konnotasjoner, så mange tror at handel aldri kan være enkel. Det er sant at SMA er treg, men dette trenger ikke å være en begrensning og kan reduseres. Du vil oppdage at ved å bruke flere SMAer, kan ulempene overvinnes for å holde deg på høyre side av handelen, mesteparten av tiden. Ta et eksempel på en næringsdrivende som bare bruker 200 SMA til å spare en aksje. Det vil være tilfeller hvor bestanden vil begynne å falle, men 200 SMA vil fremdeles peke opp. Konkurransen her for de fleste handelsmenn er om de burde holde, fordi den langsiktige trenden fortsatt er oppe, eller selger fordi aksjen faller. Denne ekstremt smale bruken av mange forhandlere er hvordan SMAer får sitt dårlige rykte. Bare å legge til en 5 SMA, 20 SMA eller 50 SMA i ligningen, vil advare handelsmannen om eventuell reversering, da disse SMAene vil reagere raskere enn 200 SMA til eventuelle endringer i pris. Hvorfor enkle bevegelige gjennomsnitt Arbeid, når det brukes riktig Vi har rørt på en av de største ulempene ved SMA og hvordan kan den reduseres, så hva er da noen av fordelene sine. Vel, det faktum at SMA er så velkjente at profesjonelle gulvhandlere, sikringsfondsledere og til og med skoskinsgutten overvåker dem, gjør disse TA-indikatorene så mye kraftigere. Bølgen av å kjøpe (eller selge) når et stort bevegelige gjennomsnitt, spesielt 200 SMA, er penetrert, er testamente til dets styrke. Les Fungerer teknisk analyse virkelig for å forstå mekanismen til hvorfor noen tekniske indikatorer er så kraftige, selv om indikatoren ved første øyekast ikke ser ut til å passe for oppgaven ved hånden. Bruke flere tidsrammer MAs Så hvorfor mister handelsmenn ofte når de bruker SMA og ender opp med å gi opp på denne indikatoren. De fleste nybegynnere handler generelt feilen ved å bruke bare en enkelt SMA for å gjøre sine handelsbeslutninger. Dette er hvor sjansen for feil er veldig høy. Tenk deg en situasjon der en handelsmann kjøper basert på 5 SMA-kjøpssignalet, men skjønner ikke at 200 SMA indikerer en sterk downtrend. Traderen kan bli heldig og tjene penger, men i det lange løp vil den rådende langsiktige trenden vinne ut og motvirkningstendenser vil ende opp med å tape en handler mye penger. BannRonn Trends-segmentet på nettstedet vårt inneholder flere SMAer av aksjer for å hjelpe deg med å ta grunnleggende tekniske avgjørelser når tidsinnspillingene går ut og går ut i din favorittbeholdning. Her er noen enkle regler å huske på når du bruker disse dataene: Trading EntryExit Regler Langsiktig trend (200SMA) - Opp Middels sikt trend - Opp Det endelige inngangspunktet vil bli bestemt av 5 SMA eller 20 SMA (avhengig av preferanse). Tålmodighet er kritisk på dette tidspunktet. Vent på aksjen for å trekke tilbake og 5 eller 20 SMA viser downtrend. Deretter angis når 5 eller 20 SMA svinger og angir en opptrend. Stopp tappunkt bør være hvor 50SMA eller 200 SMA avgjørende viser en downtrend og også avhengig av individets komfortnivå og risikovurdering. For større sikkerhet, men med den potensielle risikoen for å gå glipp av mange gode handler, kan inngangspunktet finjusteres for å være i nærheten av 50 eller 200 SMA. For korte stillinger, bare reverser ovennevnte. Se diagrammet til høyre for et eksempel på Kjøpssoner basert på de diskuterte reglene. Ytterligere tips for vellykkede handler Angi et overskuddsmål. Mange handelsmenn og investorer lar fortjenesten deres fordampe fordi de ikke tar fortjeneste. Hvis du tror at aksjen fortsatt har plass til å gå, så ta i det minste delvis fortjeneste. Noen gode mål for å ta fortjeneste inkluderer støtteforsterkningsområder nær Pivot Points, f. eks. Ukentlig pivot, R1, R2, S1, S2. Du kan se et eksempel på støttesiden og motstandssiden til Apple Inc. Mange ganger kan en skremmende forhandler komme inn på en mye gunstigere pris etter å ha kommet ut av et pivotpunkt. Ikke gift med en aksje. Det er nesten tusenvis av aksjer der ute i ulike sektorer og næringer. Hvis en lager ikke oppfyller dine kriterier, finn en annen. Hvis du kjøper inn i en aksje, og det skjer så snart det blir sydpå, med alle indikatorene som også reverserer, er det best å kutte tapene dine og gå videre til neste mål. Tredje skjermstrategi - Dr. Alexander Elder Kommersielt medlem Ble med i mai 2012 3.332 Innlegg Dette er en Trend-strategi som bruker en del av den kvarte skjermstrategien for Dr. Alexander Elder. For det første finner jeg i et D1-diagram den globale trenden ved hjelp av MACD-indikatoren. Når den generelle trenden er klar, bruker jeg H1 tidsrammen til å fungere i samme trend ved hjelp av Williams Percentage Indicator. Når stillingene åpnes, styrer jeg økonomiske nyheter og grunnleggende analyser for å lukke posisjonen hvis jeg tror at trenden er i ferd med å reversere på D1-diagrammet. Den ovennevnte trendstrategien brukes i sammenheng med prisaksjonsstøttemotstand (PASR). Større områder av støtte og motstand er funnet ved hjelp av ukentlige og månedlige diagrammer. Det er viktig å observere pris handling (stearinlysdannelse) på disse betydelige SampR nivåene før du legger en handel. Tredje skjermstrategi EA Denne spesielle EA er spesielt utformet rundt denne strategien. D1 MACD amp H1 Williams ONLY. Ingen EMAer brukes til denne strategien. Hvis du har spørsmål om denne EA, vennligst se FAQ-dokumentet nederst i dette innlegget FØRSTE Hvis du ikke finner det du leter etter, vennligst vennligst les gjennom hele denne tråden FØRST Så, hvis du fortsatt ikke kan finne svar på dine spørsmål så vær så snill å spørre. Jeg lover deg at du vil lære mye om denne strategien og vil komme over tonnevis av levende eksempler som vil inkludere diagrammer som støtter denne strategien. Jeg ønsker ikke å skje mat noen her, vi er forhåpentligvis alle ansvarlige voksne. Hvis du ikke kan lese, har du ikke noe forretningsmessig handel Foreign Currency Khaled, gentleman som har programmert denne strategien til en ekspertrådgiver, har brukt mye tid på å gjøre denne strategien så enkel å bruke som mulig. Som jeg sa ovenfor, hvis du har noen spørsmål om denne EA eller strategien generelt, vennligst les gjennom hele tråden. Første Stop Loss amp. Ta fortjeneste Parametre (klikk denne lenken for å finne anbefalt stop-loss-amp ta overskuddsparametere). Alle spørsmål i Hilsen til den tredje skjermstrategien EA kan bli bedt om og besvart i tråden for tredje skjermstrategi. Dette vil hjelpe oss med å holde denne tråden dedikert til å handle denne strategien, og ikke bli distrahert med spørsmål og svar fra MT4 Expert Advisor. En detaljert beskrivelse av denne handelsstrategien. Ligner mer som en medisinsk diagnostisk test, tripplesystemet ble utviklet av Dr. Alexander Elder tilbake i 1985. Den medisinske allusjonen er ikke uhell: Dr. Elder jobbet i mange år som psykiater i New York før de blir involvert i finansiell handel. Siden den tiden har han skrevet dusinvis av artikler og bøker, inkludert 8220Trading For A Living8221 (1993). Han har også snakket på flere store konferanser. Mange forhandlere vedtar en enkelt skjerm eller indikator at de gjelder for hver handel. I prinsippet er det ingenting galt med å vedta og overholde en enkelt indikator for beslutningstaking. Faktisk er disiplinen involvert i å opprettholde et fokus på et enkelt mål knyttet til den personlige disiplinen kanskje en av hovedbestemmelsene for å oppnå suksess som handelsmann. Hva skjer hvis din valgte indikator er fundamentalt feil Hva om forholdene i markedet endrer seg slik at din enkeltskjerm ikke lenger kan regne med alle tilfeldighetene som opererer utenfor målingen. Poenget er fordi markedet er svært komplisert, selv de mest avanserte indikatorene kan ikke jobbe hele tiden og under alle markedsforhold. For eksempel, i et marked opptrend, stiger trend-følge indikatorer og utsteder 8220buy8221 signaler mens oscillatorer antyder at markedet er overkjøpt og utsteder 8220sell8221 signaler. I downtrends, trend-følgende indikatorer foreslår salg kort, men oscillators blir oversold og utsteder signaler for å kjøpe. I et marked som beveger seg sterkt høyere eller lavere, er trend-følgende indikatorer ideelle, men de er utsatt for raske og brå endringer når markedene handler i områder. Innenfor handelsområder er oscillatorer det beste valget, men når markedene begynner å følge en trend, utsender oscillatorer for tidlige signaler. (For mer om oscillatorer, se Bli kjent med oscillatorer - Del 1, Del 2, Del 3 og Del 4). For å finne frem til en balanse mellom indikatoruttalelsen, har noen forhandlere forsøkt å gjennomsnittlig kjøp og salgssignaler utstedt av ulike indikatorer. Men det er en feil i denne praksisen. Hvis det i beregningen av antall trendfølgende indikatorer er større enn antall oscillatorer som brukes, vil resultatet naturligvis bli skjevt mot et trend-følgeresultat, og omvendt. Dr. Elder utviklet et system for å bekjempe problemene med enkel gjennomsnittlig bruk, samtidig som man utnyttet det beste av både trend-følgende og oscillatorteknikker. Eldersystem er ment å motvirke manglene på individuelle indikatorer samtidig som det tjener til å oppdage markedets iboende kompleksitet. Som en trippel skjermmarkør i medisinsk vitenskap, gjelder trippelsystemets handelssystem ikke en, ikke to, men tre unike tester, eller skjermbilder, til enhver handelsavgjørelse, som danner en kombinasjon av trendfølgende indikatorer og oscillatorer. (For mer om indikatorer, se Økonomiske indikatorer for å kjenne og handle psykologi og tekniske indikatorer.) Problemet med tidsrammer Det er imidlertid et annet problem med populære trendfølgende indikatorer som må strykes ut før de kan brukes. Den samme trendfølgende indikatoren kan utgjøre motstridende signaler når den brukes på forskjellige tidsrammer. For eksempel kan samme indikator peke på en opptrend i et daglig diagram og utstede et selgesignal og peke på en nedtrend i et ukentlig diagram. Problemet forstørres enda mer med intradagskjemaer. På disse kortsiktige diagrammene kan trend-følgende indikatorer fluktuere mellom kjøp og salgssignaler på en time eller enda hyppigere basis. For å bekjempe dette problemet er det nyttig å dele tidsrammer i enheter på fem. Ved å dele månedlige diagrammer i ukentlige diagrammer, er det 4,5 uker til en måned. Flytter fra ukentlige diagrammer til daglige diagrammer, er det akkurat fem handelsdager per uke. Fremgang av ett nivå videre, fra daglige til timediagrammer, er det mellom fem og seks timer på en handelsdag. For daghandlere kan timediagrammer reduseres til 10-minutters diagrammer (nevner av seks) og til slutt fra 10-minutters diagrammer til to-minutters diagrammer (nevner av fem). Kjernen i denne faktor med fem konsept er at handelsbeslutninger bør analyseres i sammenheng med minst to tidsrammer. Hvis du foretrekker å analysere dine handelsbeslutninger ved hjelp av ukentlige diagrammer, bør du også bruke månedlige diagrammer. Hvis du handler med 10-minutters diagrammer, bør du først analysere timediagrammer. Når handelsmannen har bestemt seg for tidsrammen som skal benyttes under det tredobbelte skjermsystemet, merker han eller hun denne tidsrammen som mellomliggende tidsramme. Den langsiktige tidsrammen er en ordre på fem lengre og kortsiktig tidsramme er en størrelsesorden kortere. Traders som bærer sine handler i flere dager eller uker, vil bruke daglige diagrammer som deres mellomliggende tidsrammer. Deres langsiktige tidsrammer vil være ukentlige diagrammer timediagrammer vil være deres kortsiktige tidsramme. Daghandlere som holder posisjoner i mindre enn en time, vil bruke et 10-minutters diagram som deres mellomliggende tidsramme, et timediagram som deres langsiktige tidsramme, og et to-minutters diagram som en kortsiktig tidsramme. Tredjeparts handelssystem krever at diagrammet for den langsiktige trenden undersøkes først. Dette sikrer at handel følger tidevannet i den langsiktige trenden, samtidig som det tillater inngang til bransjer til tider når markedet beveger seg kort mot trenden. De beste kjøpsmulighetene oppstår når et stigende marked gjør en briefer-nedgang de beste kortere mulighetene er indikert når et fallende marked samles kort. Når den månedlige trenden er oppad, representerer ukentlig nedgang kjøpsmuligheter. Timeløftene gir muligheter til kort når den daglige trenden er nedadgående. Aksjemarkedet vurderes generelt å følge tre trender, som markedsanalytikere har identifisert gjennom historien, og kan anta at de vil fortsette i fremtiden. Disse trendene er som følger: Den langsiktige trenden varer i flere år, den mellomliggende trenden i flere måneder, og den mindre trenden som generelt antas å være noe mindre enn flere måneder. Robert Rhea, en av markedets første tekniske analytikere, markerte disse trendene som tidevann (langsiktige trender), bølger (mellomtidsutvikling) og krusninger (kortsiktige trender). Handel i retning av markedsvannet er generelt den beste strategien. Bølger gir muligheter til å komme inn eller ut av handler, og krusninger bør vanligvis ignoreres. Mens handelsmiljøet har blitt mer komplisert siden disse forenklede konseptene ble artikulert i første halvdel av det tjuende århundre, er deres grunnleggende grunnlag fortsatt sant. Traders kan fortsette å handle på grunnlag av tidevann, bølger og krusninger, men tidsrammer som disse illustrasjonene gjelder bør raffineres. (For å lese mer, sjekk ut kortsiktige, mellomstore og langsiktige trender.) Under trippleskjermhandelssystemet er tidsrammen som handelsmannen ønsker å målrette, merket mellom tidsrammen. Den langsiktige tidsrammen er en størrelsesorden lenger mens handelsmannens kortsiktige tidsramme er en størrelsesorden kortere. Hvis din komfortsone, eller din mellomliggende tidsramme, kaller for å holde posisjon i flere dager eller uker, så vil du bekymre deg for de daglige diagrammer. Din langsiktige tidsramme vil være en størrelsesorden lenger, og du vil ansette de ukentlige diagrammene for å begynne analysen. Din kortsiktige tidsramme vil bli definert av timekartene. Hvis du er en daghandler som har en stilling i løpet av minutter eller timer, kan du bruke de samme prinsippene. Den mellomliggende tidsrammen kan være et ti minutters diagram et timediagram samsvarer med den langsiktige tidsrammen, og et to-minutters diagram er kortsiktig tidsramme. (For videre lesing, se Day Trading: En introduksjon.) Første skjerm på trippelskjermhandelssystemet: Market Tide Trippelskjerm handelssystemet identifiserer langsiktige diagrammet eller markedsvannet som grunnlag for å gjøre handelsavgjørelse. Traders må begynne med å analysere deres langsiktige diagram, som er en størrelsesorden større enn tidsrammen som handelsmannen planlegger å handle. Hvis du normalt starter med å analysere de daglige kartene, kan du prøve å tilpasse tenkningen til en tidsramme forstørret med fem, og begynne på handelsanalysen din ved å undersøke ukentlige diagrammer i stedet. Ved hjelp av trend-indikatorer kan du deretter identifisere langsiktige trender. Den langsiktige trenden (markedets tidevann) er indikert ved helling av det ukentlige glidende konvergensdivisjonen (MACD) histogrammet, eller forholdet mellom de to siste stolpene på diagrammet. Når hellingen av MACD-histogrammet er oppe, er tyrene i kontroll, og den beste handelsavgjørelsen skal inngå i en lang posisjon. Når skråningen er nede, er bjørnene i kontroll, og du bør tenke på kortsiktighet. (For mer informasjon, se Trading MACD Divergence, Moving Average Convergence Divergence - Del 1 og Del 2). En hvilken som helst trend-indikator som handelsmannen foretrekker, kan realistisk brukes som det første skjermbildet for tripplesystemet. Traders har ofte brukt retningssystemet som det første skjermbildet eller til og med en mindre kompleks indikator, som for eksempel helling av et eksponentielt glidende gjennomsnitt på 13 uker kan benyttes. Uansett hvilken trendfølgende indikator du velger å begynne med, er prinsippene de samme: sørg for at du analyserer trenden ved hjelp av de ukentlige diagrammer først og deretter se etter flått i de daglige diagrammer som beveger seg i samme retning som den ukentlige trenden . (For mer informasjon, se Retningsbevegelse - DMI og grunnleggende om bevegelige gjennomsnitt.) Avgjørende betydning for å ansette markedsvannet utvikler evnen til å identifisere endring av en trend. En enkelt oppblåsing eller et nedslag i diagrammet (som i eksempelet ovenfor, en enkelt opptelling eller en nedtur i det ukentlige MACD-histogrammet) vil være din måte å identifisere en langsiktig trendendring på. Når indikatoren dukker opp under senterlinjen, får du de beste markedsvannskjøpsignalene. Når indikatoren slår ned fra over senterlinjen, blir de bestselgende signalene utstedt. Modellen av årstider for å illustrere markedsprisene følger et konsept utviklet av Martin Pring. Prings-modellen kommer fra en tid da økonomisk aktivitet var basert på landbruk: Frøene ble sådd om våren, høsten fant sted om sommeren og høsten ble brukt til å forberede seg på kaldt stave om vinteren. I Pring8217s modell bruker handelsmenn disse parallellene ved å forberede seg til å kjøpe om våren, selge om sommeren, korte lager på høsten og dekke korte stillinger om vinteren. Prings modell er anvendelig ved bruk av tekniske indikatorer. Indikator quotseasonsquot tillater deg å bestemme nøyaktig hvor du er i markeds syklusen og å kjøpe når prisene er lave og korte når de går høyere. Den eksakte sesongen for enhver indikator er definert av sin skråning og dens posisjon over eller under midtlinjen. Når MACD-histogrammet stiger fra under senterlinjen, er det vår. Når den stiger over senterlinjen, er det sommer. Når det faller fra over senterlinjen, er det høst. Når det faller under senterlinjen, er det vinter. Vår er sesongen for handel lenge, og høsten er den beste sesongen for å selge kort. Enten du foretrekker å illustrere ditt første skjermbilde av trippleskjermhandelssystemet ved hjelp av havmetaforen eller analogien til årstidens endring, forblir de underliggende prinsippene de samme. Et handelsoverskrift er det fremste tekniske verktøyet for å gjøre handelsbeslutninger med tripplesystemets handelssystem. For eksempel bruker handelsmenn vanligvis ukentlig flytte gjennomsnittlig konvergensdivergens (MACD) histogrammer for å fastslå deres langsiktige interesseinteresse. Bestemme hvilke aksjer som skal handles daglig, traff handelsmannen etter en enkelt uptick eller en downtick som forekommer på det ukentlige diagrammet for å identifisere en langsiktig trendendring. Når en oppblåsing oppstår og indikatoren dukker opp under sin midtlinje, får du de beste markedsvannskjøpsignalene. Når indikatoren slår ned fra over senterlinjen, blir de bestselgende signalene utstedt. Ved å bruke havsmetaforene som Robert Rhea utviklet (se Triple Screen Trading System - del 2), ville vi merke den daglige markedsaktiviteten som en bølge som går imot den langsiktige ukentlige tidevannet. Når den ukentlige trenden er oppe (uptick på ukentlige diagrammet), avtar det daglige kjøpsmuligheter. Når den ukentlige trenden er nede (downtick på det ukentlige diagrammet), indikerer daglige samlinger kortmuligheter. Second Screen 8211 Market Wave Daglige avvik fra den langsiktige ukentlige trenden er ikke indikert av trend-følgende indikatorer (for eksempel MACD-histogrammet), men av oscillatorer. Oscillatorer utsteder kjøpesignaler etter hvert som markedene er i nedgang og selger signaler når markedene stiger. Skjønnheten i tripplesystemet er at det tillater handelsmenn å konsentrere seg bare på de daglige signaler som peker i retning av den ukentlige trenden. (For videre lesing, se Bli kjent med oscillatorer - Del 1, Del 2 og Del 3). For eksempel, når den ukentlige trenden er oppe, vurderer trippleskjermhandelssystemet bare kjøpssignaler fra daglige oscillatorer og eliminerer selgesignaler fra oscillatorene . Når den ukentlige trenden er nede, ignorerer triple skjermen eventuelle kjøpssignaler fra oscillatorer og viser bare kortsignaler. Fire mulige oscillatorer som lett kan innlemmes i dette systemet, er kraftindeks, eldre-stråleindeks, stokastisk og Williams R. (For mer detaljer, se Oppdage Force-indeksen - Del 1 og Del 2 og Den eldste stråleindikatoren: Å se inn i Market.) Force Index Et todagers eksponentielt glidende gjennomsnitt (EMA) av kraftindeks kan brukes i forbindelse med det ukentlige MACD-histogrammet. Faktisk er følsomheten til den to-dagers EMA av kraftindeks det mest hensiktsmessig å kombinere med andre indikatorer som MACD-histogrammet. Nærmere bestemt, når den to-dagers EMA med kraftindeks svinger over sin midtlinje, viser det at oksene er sterkere enn bjørner. Når den to-dagers EMA av kraftindeks faller under senterlinjen, viser denne indikatoren at bjørnene er sterkere. (For ytterligere lesing, se Graving Dypere i Bull og Bear Markets.) Mer spesifikt bør handelsmenn kjøpe når en to-dagers EMA av kraftindeks blir negativ under en uptrend. Når det ukentlige MACD-histogrammet indikerer en oppadgående trend, er den beste tiden å kjøpe, en øyeblikkelig tilbaketrekning, indikert med en negativ sving på den to-dagers EMA av kraftindeks. Når en to-dagers EMA av kraftindeks blir negativ i løpet av en ukentlig opptrinn (som angitt på det ukentlige MACD-histogrammet), bør du legge inn en bestillingsordre over den høye prisen på den aktuelle dagen. Hvis opptrenden er bekreftet og prisene samles, vil du motta en stoppordre på langsiden. Hvis prisene faller i stedet, vil bestillingen din ikke bli utført, men du kan deretter senke kjøpsordren din slik at den er innenfor ett kryss av høyeste av den siste linjen. Når den kortsiktige trenden reverserer og kjøperstoppet ditt utløses, kan du ytterligere beskytte deg selv med et annet stopp under lavt på handelsdagen eller i forrige dag, avhengig av hvilken lav som er lavere. I en sterk opptrinn blir ikke din beskyttende bestemmelse utløst, men handelen din vil bli sluppet tidlig hvis trenden viser seg å være svak. De samme prinsippene gjelder i revers under en ukentlig nedtrend. Traders bør selge kort når en to-dagers EMA av kraftindeks blir positiv under den ukentlige nedgangen. Du kan da plassere bestillingen din for å selge kort under den laveste av den nyeste prislinjen. Lignende i naturen til den lange stillingen som beskrevet ovenfor, gir den korte stillingen deg mulighet til å bruke beskyttende stopp for å beskytte din fortjeneste og unngå unødvendige tap. Hvis den to-dagers EMA of Force Index fortsetter å rally etter plasseringen av din salgsordre, kan du heve din salgsordre daglig, så det er innenfor et enkelt kryss av de nyeste barene lavt. Når din korte posisjon er endelig etablert av fallende priser, kan du deretter sette et beskyttende stopp rett over høyden av den siste prislinjen eller den forrige linjen hvis høyere. (For ytterligere lesing, se Stop-stoppordren - Pass på at du bruker den.) Hvis dine lange eller korte stillinger ennå ikke er stengt, kan du bruke en to-dagers EMA med kraftindeks for å legge til dine posisjoner. I en ukentlig opptrinn, fortsett å legge til for lenge når kraftindeksen blir negativ, fortsett å legge til shorts i downtrends når kraftindeksen blir positiv. Videre vil den to-dagers EMA of Force Index angi den beste tiden for å lukke en stilling. Ved handel på grunnlag av en langsiktig ukentlig trend (som angitt i det ukentlige MACD-histogrammet), bør næringsdrivende bare gå ut av en stilling når den ukentlige trenden endres, eller hvis det er en avvik mellom to-dagers EMA for kraftindeks og trenden. Når avviket mellom to-dagers EMA for kraftindeks og pris er bullish, blir et sterkt kjøpsignal utstedt. På denne bakgrunn oppstår en bullish divergens når prisene treffer en ny lav, men kraftindeksen gjør en grunne bunn. Selgesignaler er gitt ved bearish divergenser mellom to-dagers EMA med kraftindeks og pris. En bearish divergens oppnås når prisene stiger til en ny høy mens kraftindeksen treffer en sekundær topp. Markedsbølgen er den andre skjermen i tripplesystemet, og den andre skjermen er pent illustrert med kraftindeks, men andre som eldste-ray, stokastiske og Williams R kan også brukes som oscillatorer for markedet bølgeskjermen. Tredjeparts handelssystem er basert på å benytte det beste av begge trend-følgende indikatorer og oscillatorer for å gjøre handelsbeslutninger. Traders er først og fremst opptatt av eventuelle realiserte avvik mellom avlesningene av en langsiktig trend-følgende indikator, for eksempel et ukentlig bevegelig gjennomsnittlig konvergensdivergens (MACD) histogram og den relativt kortere lesing fra en oscillator som kraftindeks, eldste-Ray , stokastisk eller Williams R. Den fjerde delen av denne serien vil undersøke måten som en handelsmann ville bruke eldre-stråle-oscillatoren som markedsbølge, som er det andre skjermbildet av det tredobbelte skjermsystemet. (For ytterligere lesing, se Triple Screen Trading System - Del 3 og Elder Ray Indicator: Se inn i markedet.) Second Screen - Elder-Ray Elder-Ray, utarbeidet av Dr. Alexander Elder, er basert på begreper tyrkekraft og bære kraft, den relative styrken av okser og bjørner i markedet. Bull power måler markedstjures evne til å presse priser over gjennomsnittlig konsensus om verdi, som er den faktiske prisen som en bestemt aksje skjer for å handle for et gitt tidspunkt. Bjørnkraft er bjørnenes evne til å kjøre priser lavere enn nåværende priser, eller nåværende gjennomsnittlig konsensus om verdi. (Se handelspsykologi og tekniske indikatorer.) Ved å bruke en langsiktig trend-indikator, kanskje et ukentlig MACD-histogram, kan handelsfolk identifisere retningen for den langsiktige trenden. Bull power og bjørnkraft brukes da til å finne handler på de daglige diagrammer som beveger seg i samme retning som den ukentlige trenden. Den tredobbelte skjermen tjener sin quotscreeningquot-etikett fordi den eliminerer alle signaler, men de i retning av trenden: Hvis den ukentlige trenden er opp, blir bare kjøpssignaler returnert fra Elder-Ray. Hvis den ukentlige trenden er nede, vurderes bare Elder-Ray-selgesignaler. Kjøp signaler Det er to absolut viktige forhold som må være på plass for handelsmenn å vurdere å kjøpe: 1) den ukentlige trenden skal være opp, og 2) bærekraft, som representert på eldste ray, bør være negativ, men stigende. Den andre betingelsen - negativ bjørnkraft - er verdt å utforske. Den motsatte tilstanden, der bjørnekraften er positiv, oppstår i en bølgende opptrending, et farlig markedsmiljø for handel til tross for den tilsynelatende styrken i trenden. Problemet med å kjøpe i en uendelig opptrend er at du satser på den store dumt teorien, som sier at fortjenesten din vil bli realisert bare ved å selge til noen villig til å betale en enda høyere pris. Når bjørnekraften er negativ, men stigende, viser bjørnen litt styrke, men begynner å glide igjen. Ved å plassere en kjøpsordre over det høyeste av de to siste dagene, vil din stoppordre fylles ut bare hvis rallyet fortsetter. Når du har gått lenge, kan du beskytte posisjonen din med et stopp under den siste mindre lave. Bullish forskjeller mellom bærekraft og pris (gjennomsnittlig konsensus av verdi) representerer de sterkeste kjøpesignalene. Hvis prisene faller til en ny lav, men bjørnekraft viser en høyere bunnfall, faller prisene og bjørnene blir svakere. Når bærekraft beveger seg opp fra denne andre bunnen, kan du komfortabelt kjøpe et større antall aksjer enn du vanligvis ville i din vanlige posisjon. (Se Bekreftelse med Momentum-strategien og Momentum Trading With Discipline.) Du kan også bruke eldste-Ray til å bestemme den beste tiden for å selge posisjonen din. Ved å spore mønsteret av topper og daler i oksekraft, kan du finne ut styrken til oksene. Ved å stable toppene i faktisk pris mot toppene i tyrefekt, kan du bestemme styrken på opptrenden - hvis hver ny topp i pris kommer sammen med en ny topp i tyrkraft, er opptrenden trygg. Når prisene når en ny høy, men tyrnekraften når en lavere topp enn den i sitt tidligere rally, tyrnene mister sin kraft og et salgssignal utstedes. (For mer informasjon, se Peak-And-Trough Analysis.) Shorting Elder-Ray som det andre skjermbildet i tripplesystemets handelssystem kan også brukes til å fastslå vilkårene for kortslutning. De to essensielle betingelsene for kortsiktighet er 1) Trenden er nede og 2) Bullkraft er positiv, men fallende. (For videre lesing, sjekk ut Short Selling Tutorial.) Hvis tyrenergien allerede er negativ, selger kort er upassende fordi bjørn har kontroll over markedstjurene. Hvis du selger kort i denne tilstanden, satser du effektivt på at bjørn har tilstrekkelig styrke til å presse okser enda lenger under vann. Videre, som i det tilfelle som er omtalt ovenfor, der handelsmannen har en lang posisjon under positiv bjørnkraft, satser du på den større dumt teorien. Når oksekraften er positiv, men fallende, har tyrene grepet litt styrke, men begynner å synke igjen. Hvis du legger inn en kort ordre under den laveste av de to siste dagene, får du bare en ordreutførelse hvis nedgangen fortsetter. Du kan da sette et beskyttende stopp over den siste mindre høye. Bearish forskjeller mellom tyveri og priser (gjennomsnittlig konsensus av verdi) gir de sterkeste shortingsignalene. Hvis prisene treffer en ny høy, men tyrnekraft treffer en nedre topp, er oksene svakere enn før, og oppgangen kan ikke fortsette. Når tyren tommer ned fra en nedre topp, kan du trygt selge kort en større enn vanlig posisjon. Du kan også bestemme når du skal dekke dine korte stillinger på grunnlag av en lesning av Elder-Ray. Når den langsiktige trenden er nede, vil bærekraften indikere om bjørn blir sterkere eller svakere. Hvis en ny lavpris oppstår samtidig med en ny, lite bærekraft, er den nåværende nedgangen relativt sikker. En bullish divergens utgjør et signal for å dekke dine shorts og forberede seg på å komme inn i en lang posisjon. Bullish divergenser oppstår når prisene treffer en ny lav og bjørnkraft treffer en enda grunne bunn, når bjørner mister sin fart og prisene faller sakte. For både lange og korte stillinger indikerer forskjellene mellom tyngdekraft, bærekraft og priser de beste handelsmulighetene. I sammenheng med den langsiktige trenden som er indikert av vår første markedsskjermer, identifiserer eldste Ray det øyeblikk da markedets dominerende gruppe faller under overflaten av trenden. For det andre skjermbildet for trippleskjermhandelssystemet, anbefaler Dr. Alexander Elder bruk av sofistikerte og moderne oscillatorer som kraftindeks og Elder-Ray. Men handelsmenn burde ikke føle seg begrenset til noen av disse to oscillatorene - din favorittoscillator vil nok fungere like bra, så du bør erstatte oscillatoren som du føler deg mest komfortabel. To andre oscillatorer som lett kan brukes som den andre skjermen, er de stokastiske og Williams R-oscillatorene. Stochastic Stochastic is currently one of the more popular oscillators and is included in many widely available software programs used both by individual traders and professionals. In particular, traders who employ strict computerized systems to execute their trades find that stochastic oscillators have many good qualities. For example, stochastic has an excellent track record in weeding out bad signals. More specifically, stochastic uses several steps for the express purpose of filtering out market noise, the type of ultra short-term movements that do not relate to the traders current trend of interest. Similarly to Elder-Ray, stochastic identifies the precise moment at which bulls or bears are becoming stronger or weaker. Obviously, traders are best off jumping aboard the strongest train and trading with the winners while pitting themselves directly against the losers. The three types of signals important to traders using stochastic are divergences, the level of the stochastic lines and the direction of the stochastic lines. (To further detail, see Getting To Know Oscillators - Part 3: Stochastics and What is the difference between fast and slow stochastics in technical analysis) Divergences A bullish divergence occurs when prices hit a new low but stochastic traces a higher bottom than it did in the previous decline. This means the bears are losing their grip on the market and simple inertia is driving prices lower. A very strong buy signal is issued as soon as stochastic turns up from its second bottom. Traders are well advised to enter into a long position and place a protective stop below the latest low in the market. The strongest buy signals appear when the stochastic lines first bottom is placed below the lower reference line and the second bottom above it. Conversely, a bearish divergence corresponds to the circumstance in which prices rally to a new high but stochastic reaches a lower top than anytime during its previous rally. Bulls are then becoming weaker and prices are rising sluggishly. The crucial sell signal is issued when stochastic turns down from its second top. Traders bør gå inn i en kort posisjon og legge et beskyttende stopp over den siste prisen høyt. De beste signalene til å selge kort forekommer når den første toppen er over den øvre referanselinjen og den andre er under den, motsatt av de beste signalene til å gå lenge. (To learn more, check out Divergences, Momentum And Rate Of Change and Moving Average Convergence Divergence - Part 1 and Part 2.) Level of Stochastic Lines The level attained by the stochastic lines represents distinct overbought or oversold conditions. When stochastic rallies above the upper reference line, the market is said to be overbought and is ready to turn downwards. I motsetning til dette er den solgte tilstanden, der markedet er klar til å vise seg, representert av stokastikken som faller under den nedre referanselinjen. Traders should, however, be careful in interpreting overbought and oversold conditions using stochastic: during a longer-term trend, stochastic may issue contrary signals. In strong uptrends - as may be indicated by the traders first market screen - the moving average convergence divergence (MACD) histogram, stochastic becomes overbought and issues erroneous sell signals while the market rallies. In downtrends, stochastic quickly becomes oversold and gives buy signals earlier than warranted. Although interpreting overbought and oversold conditions with stochastics can be problematic, when using the MACD histogram as the first screen of the triple screen trading system, traders can easily eliminate these incorrect signals. Traders should take buy signals from the daily stochastic only when the weekly MACD histogram shows an upward trend. When the trend is down, only sell signals from the daily stochastic should be heeded. Bruk ditt ukentlige diagram for å identifisere en opptrinn, vent på daglige stokastiske linjer å krysse under deres nedre referanselinje før du kjøper. Immediately place your buy order above the high of the latest price bar. You can then protect your position with a protective stop placed below the low of the trade day or the low of the previous day, whichever is lower. For å legge til et ytterligere detaljnivå i denne analysen, hvordan form av stokastikkbunn kan indikere den relative styrken til rallyet bør diskuteres. If the bottom is narrow and shallow, the bears are weak and the rally is likely to be strong. Hvis bunnen er dyp og bred, er bjørnene sterke og rallyet kan meget vel være svakt. When you identify a downtrend on your weekly chart, do not enter your trade until daily stochastic lines rally above their upper reference line. You can then immediately place an order to sell short below the low of the latest price bar. Do not, however, wait for a crossover on the stochastic lines as the market will then already likely be in a free fall. To protect your short position, place a protective stop above the high of that particular trading day or the previous day, whichever is higher. Formen på stokastikk toppen kan også indikere den relative bølgen eller tregheten i markedene avtar. A narrow top in the stochastic line shows the weakness of bulls and the likelihood of a severe decline. En høy og bred stokastisk topp demonstrerer styrken til okser, og derfor bør man unngå unormale posisjoner. In summary, the means by which traders can filter out most bad trades involves an intimate knowledge of overbought and oversold conditions. When stochastic is overbought, do not buy. When stochastic is oversold, do not sell short. Stokastisk linjedireksjon Ganske enkelt, når begge stokastiske linjene beveger seg i samme retning, er den kortsiktige trenden bekreftet. When prices rise along with both stochastic lines, the uptrend is most likely to continue. When prices slide along while both stochastic lines are falling, the short-term downtrend will likely continue. Når du er ansatt riktig, kan stokastisk være en ekstremt effektiv og nyttig oscillator som en del av tripplesystemet. In Part 6 of this article, well examine the fourth oscillator of interest, Williams R. In previous parts to this series on Dr. Alexander Elders triple screen trading system, various oscillators have been discussed in relation to the second screen of the system. Two excellent oscillators that work extremely well within the system are force index and Elder-Ray however, any other oscillators may also be employed. Part 5 of this series described stochastic in relation to the powerful signals formed by divergences between the power of bulls and bears in the market. In this section, we8217ll discuss one final oscillator that can be used as the second screen in the triple screen trading system: Williams R. Williams R The final oscillator that needs consideration in relation to its use as the second screen of the triple screen trading system is Williams R, which is actually interpreted in similar fashion to that of stochastic. Williams R, or WmR, measures the capacity of bulls and bears to close the days stock prices at or near the edge of the recent range. WmR confirms the strength of trends and warns of possible upcoming reversals. The actual calculation of WmR will not be dissected in detail in this space, as its current value can be obtained through top trading software packages that are widely available today. In its calculation, WmR measures the placement of the latest closing price in relation to a recent high-low range. It is important to note that WmR requires at least a four - to five-day range of prices to work effectively with the triple screen trading system. WmR expresses the distance from the highest high within its range to the lowest low in relation to a 100 scale. The distance from the latest closing price to the top of the range is expressed as a percentage of the total range. When WmR is equal to 0 on the 100 scale, the bulls reach the peak of their power and prices should close at the top of the range. In other words, a zero reading, plotted at the top of the chart, indicates maximum bull power. When WmR reads 100, the bears are at the peak of their power and they are able to close prices at the bottom of the recent range. The high of the range is a precise measure of the maximum power of bulls during the period in question. The low of the range relates to the maximum power of bears during the period. Closing prices are especially significant in calculating WmR, as the daily settlement of trading accounts depends on the days (or weeks, or months) close. WmR provides a precise assessment of the balance of power between bulls and bears at the market close, the most crucial time for a true feel for the relative bullishness or bearishness of the market. If we extrapolate this concept one level further, we see that WmR shows which group is able to close the market in its favor. If the bulls cannot quite close the market at or near the top during a market rally, the bulls are proven to be somewhat weaker than they appear. If bears cannot close the market near the lows during a bear market, they are weaker than they would appear on the surface. This situation presents a buying opportunity. If reference lines are drawn horizontally at 10 and 90 levels, this further refines the WmR interpretation. When Wm closes above its upper reference line, the bulls are strong, but the market is said to be overbought. When WmR closes below the lower reference line, the bears are strong but the market is oversold. (For additional insight, see Market Reversals And How To Spot Them and Price Patterns - Part 1.) Overbought and Oversold In an overbought condition, WmR rises above its upper reference line and prices close near the upper edge of their range. This may indicate a market top, and the WmR issues a sell signal. In an oversold condition, WmR falls below its lower reference line and prices close near the bottom of their range. This may indicate a market bottom, and the WmR issues a buy signal. During flat trading ranges, overbought and oversold signals work very well. However, when the market enters a trend, using overbought and oversold signals may be dangerous. WmR can remain near the top of its range for a week or longer during a strong rally. This overbought reading may actually represent market strength rather than the erroneous shorting signal that WmR would issue in this circumstance. Conversely, in a strong downtrend, WmR can remain in oversold territory for a long period of time, thereby demonstrating weakness rather than a buying opportunity. For these reasons, overbought and oversold readings of WmR should be used only after you have identified the major trend. This is where the first screen in the triple screen trading system is absolutely essential. You must use that first screen to ascertain whether you are currently embroiled in a longer-term bull or a bear market. (For refresher on the first screen, check out Triple Screen Trading System - Part 1.) If your longer-term chart shows a bull market, take buy signals only from your shorter-term WmR, and do not enter a short position when it gives a sell signal. If your weekly chart indicates a bear market, sell short only when WmR gives you a sell signal, but do not go long when WmR becomes oversold. Failure Swings When WmR fails to rise above its upper reference line during a rally and turns down in the middle of that rally, a failure swing occurs: bulls are especially weak, and a sell signal is issued. When WmR stops falling in the middle of the decline, failing to reach the lower reference line and turning up instead, the opposite failure swing occurs: the bears are very weak and a buy signal is issued. (For further insight, see The Dead Cat Bounce: A Bear In Bull8217s Clothing and Short-, Intermediate - and Long-Term Trends and Relative Strength Index And Its Failure-Swing Points.) Divergences The final important situation in reading WmR relates to divergences between prices and WmR. Divergences rarely occur, but they identify the absolute best trading opportunities. A bearish divergence occurs when WmR rises above its upper reference line, then falls and cannot rise above the upper line during the next rally. This shows that bulls are losing their power, that the market is likely to fall and that you should sell short and place a protective stop above the recent price high. By contrast, a bullish divergence occurs when WmR falls below its lower reference line, then moves up (rallies), and cannot decline below that particular line when prices slide the next time around. In a bullish divergence, traders should go long and place a protective stop below the recent price low. (To learn more, see The Stop-Loss Order - Make Sure You Use It and A Look At Exit Strategies.) At long last, the next part of this series on the triple screen trading system will provide a discussion of the third screen in the system. The first screen of the system identifies a market tide the second screen (the oscillator) identifies a wave that goes against the tide. The third and final screen of the triple screen system identifies the ripples in the direction of the tide. These are intraday price movements that pinpoint entry points for your buy or sell orders. The triple screen trading system can be nicely illustrated with an ocean metaphor. The first screen of the triple screen trading system takes a longer-term perspective and illustrates the market tide. The second screen, represented by an oscillator, identifies the medium-term wave that goes against the tide. The third screen refines the system to its shortest-term measure, identifying the ripples that move in the direction of the tide. These are the short-term intraday price movements that pinpoint entry points for your buy or sell orders during the trading day. (If you need a refresher, check out Triple Screen Trading System - Part 1, Part 2 and Part 3.) Fortunately, for those of us who have become weary of interpreting charts or technical indicators in the first and second screen, the third screen does not require any additional technical talent. Instead, the third screen provides us with a technique for placing stop orders, either buy stop orders or sell stop orders, depending on whether the first and second screens direct you to buy or to sell short. More specifically, the third screen is called a trailing buy stop technique in uptrends and a trailing sell stop technique in downtrends. When the weekly trend is up (identified by the first screen) and the daily trend is down (identified by the second screen, or oscillator), placing a trailing buy stop will catch upside breakouts. When the weekly trend is down and the daily trend is up, trailing sell stops catch downside breakouts. Each situation deserves further examination. Trailing Buy Stop Technique When you have identified that a longer-term (weekly) trend is moving up and your medium-term (daily) oscillator declines, the triple screen trading system activates a trailing buy stop technique. To instigate the trailing buy stop technique, place a buy order one tick above the high of the previous day. Then, if prices rally, you will be stopped into a long position automatically at the time that the rally exceeds the previous days high. If, however, prices continue to decline, your buy stop order will not be touched. This technique allows you to be stopped into your order if the shortest-term ripples have sufficient momentum to power the wave into the greater tide. The buy stop is therefore most closely related to what most traders would label as momentum investing. However, the use of all three screens within the triple screen trading system provides a much more detailed and refined picture of the market than the simple concept of momentum generally provides. (For further reading, see Momentum Trading With Discipline and Introduction To Types Of Trading: Momentum Traders.) If you want to further refine the trailing buy stop technique, you can lower your buy order the next day to the level one tick above the latest price bar. Keep lowering your buy stop each day until stopped out (filling your order at the very best time) or until your long-term (weekly) indicator reverses and cancels its buy signal (saving you from a loss). The reason that the buy stop technique is prefaced by the trailing qualification relates to this fluid nature of the buy stop order. You must, however, remain vigilant in monitoring the markets momentum, and you must be diligent in continually moving your buy stop to one tick above the latest price bar. The process can be laborious, but it will ensure that you either fill your order at the very best price or avoid a poor trade altogether if the market fails to move your way. (To read more, check out Trailing Stop Techniques and The Stop-Loss Order - Make Sure You Use It.) Trailing Sell Stop Technique The opposite situation occurs when your long-term (weekly) trend is down, at which time you would wait for a rally in your medium-term indicator (oscillator) to activate a trailing sell stop technique. In the trailing sell stop technique, you place an order to sell short one tick below the latest bars low. When the market turns down, you will automatically be stopped into your short trade. If, however, the market continues to rally, you can continue to raise your sell order on a daily basis. Opposite to the trailing buy stop technique, the trailing sell stop technique is meant to catch an intraday downside breakout from a daily uptrend. As you can see, the intraday downside breakout moves in the direction of the market tide, which in this case is a weekly downtrend. The trailing buy stop and trailing sell stop techniques are the ultimate refinements to what is already an extremely powerful trading system within the first two screens of the three screens. Using a less developed indicator, many beginning traders will engage in a system of trailing stopped orders when they attempt to gauge market momentum. By employing a longer-term chart and a medium-term oscillator first, you can capitalize on the short-term market ripples as you make the best trades that this intraday allows. The next section of this series will bring the triple screen trading system to a close. The journey through all three screens has been long, but the result is most definitely worthwhile. If you are able successfully to implement the triple screen trading system to its fullest, you are on your way to being ahead many other trader with whom you are competing for profits At long last, we have reached the end of this series describing all facets of the triple screen trading system. You will recall that the third screen in the system, the trailing buy or sell stop system, allows for the ultimate level of precision in your buy orders or, if you are selling short, your sell orders. By identifying the ripples moving in the direction of the market tide, you will best be able to capitalize on the short-term (usually intraday) price movements that pinpoint the exact points at which you should enter your position. (To brush up on previous sections, see Triple Screen Trading System - Part 1, Part 2, Part 3, Part 4, Part 5, Part 6 and Part 7.) Stop loss Technique But we have yet to discuss how the triple screen trading system assists a trader, once in a position, to secure a profit and avoid significant losses. As is the case in all levels of trading, and investing at large, the decision to exit your position, whether long or short, is just as important as your decision to enter a position. The triple screen trading system ensures that you make use of the tightest stops, both in entering and in exiting your position. Immediately after executing your purchase order for a long position, you place a stop loss order one tick below the low of the trade day or the previous day, whichever is lower. The same principle applies to a short sale. As soon as you have sold short, place a protective stop loss one tick above the high of the trade day or the previous day, whichever is highest. In order to protect against the potential for losses, move your stop to a breakeven level as soon as the market moves in your favor. Assuming that the market continues to move you into a position of profits, you must then place another protective stop at your desired level of profits. Under this system, a 50 profit level is a valid rule of thumb for your targeted profitability. The Importance of Stop Loss The stop loss orders used in exiting a position are very tight under this system because of the fundamental tide of the market. If you enter into a position using the analysis tools contained in the triple screen trading system only to see the market immediately move against you, the market has likely undergone a fundamental shift in tide. Even when identifying the markets probable long-term trend in the first screen, you can still be unlucky enough to enter your trade, for which you use the third screen, at the very moment at which the long-term trend is changing. Although the triple screen system can never identify this condition organically, the trader can prevent losses by keeping his or her stop loss extremely tight. (For further reading, see The Stop-Loss Order - Make Sure You Use It, A Look At Exit Strategies and Can a stop-loss order be used to protect a short sale transaction) Even if your position enters into the red, it is always better to exit early and take your loss sooner rather than later. Realize your small loss, then sit back, and observe what is happening in the market. You will likely be able to learn something from the experience: if the market truly has shifted its long-term direction, you might better be able to identify the situation should it happen again in the future. Conservative and Aggressive Exit Strategies The above discussion has outlined a relatively conservative strategy for risk-averse traders. By maintaining the tightest stop loss orders possible, conservative traders can easily go long or short on the first strong signal from the triple screen trading system and stay with that position for as long as the major trend lasts. Once the trend reverses, the profits will already be locked in. If the market reverses prematurely, the trader will be stopped out of major losses. A possibility for more aggressive, active traders is to continue watching the market after entering into a long or short position. While the longest-term trend is still valid, active traders can use each new signal from the second screen (the daily oscillator) to supplement the original position. This approach allows for a greater level of gross profit while still allowing the stop loss approach to protect the entire position. Adding to the original position while the trend continues is often referred to as pyramiding the original position. Another type of trading is practiced by the position trader, who should try to go long or short on the very first signal issued by the triple screen system. Then he or she should stay with that position until the trend reverses. Finally, a short-term trader may take profits using signals from the second screen. You may recall that the second screen identifies the medium-term wave that goes against the larger tide. Using the very same second screen indicator that is used prior to entering the trade, the short-term trader can use intraday occurrences of market reversals to exit the trade. If, for example, the short-term trader uses stochastic as his or her second screen oscillator, he or she may sell the entire position and take the profits when stochastic rises to 70. The trader can then revisit the first screen of the system, reconfirm the market tide and continue to drill down to the second and third screens in order to identify another buying (or selling) opportunity. Conclusion The length of this eight-part series demonstrates that Dr. Alexander Elders triple screen trading system is not the simplest means of identifying buying and selling opportunities on the markets. The system is, however, one of the most powerful means of combining a series of useful individual indicators into one comprehensive whole. The time that you spend reading these articles and familiarizing yourself with the individual components of the system will undoubtedly pay dividends to your trading success. MACD3SS. ex4 3 KB 1,658 download Uploaded Jul 9, 2013 3:05am by Jack Crooks Saturday, September 1, 2012 at 7:30am I realize its never easy and rarely simple. But today Im going to help you understand why global money-flow drives key markets and how that flow could be reversing. If I am right, it is good news for long-term dollar bulls like me, bad news for China bulls, and terrible news if you are still riding on the Peak Oil bandwagon expecting oil to hit 200 barrel soon. Three major realities lead me to those conclusions: Reality 18212 Foreign exchange reserves and growth is falling in China Some experts estimate that up to 50 billion a month is exiting China. Keep in mind, when money leaves China, it leaves as dollars for the most part. Investors exchange yuan for dollars inside China, or Hong Kong, then move those dollars to safe haven areas, such as U. S. Treasuries, U. S. farmland, or Vancouver apartment buildings. Reality 28212 Demand for oil is falling along with global growth, and the U. S. is leading the way Chinas crude oil imports fell 3 percent in July from a month ago to a nine-month low. The slowdown in growth is hitting oil demand hard in the country that has driven the increase in global fuel consumption for a decade. In fact, the International Energy Agency slashed its forecast for Chinese oil demand growth in 2012 by a third to 240,000 barrels per day (bpd) in its August monthly report. Just a month earlier, the agency had forecast growth of 360,000 bpd. If demand is already low and appears to be heading lower, I think it is time to mark down oil prices. And in the U. S. according to Reuters, oil demand in July fell to its lowest level in nearly four years. The chart below shows oil hit a brick wall of resistance at around 98 per barrel that happens to be a key retracement level. Plus, the price oscillators are turning down from an quotoverboughtquot level. This price action seems to be confirming bearish fundamental news. Reality 38212 The dollar is the worlds monetary standard The demand for dollars is poised to rise as the supply falls. I say that because: Dollar-based funding (supply) for trade finance and other credit lines is falling as European banks reduce the percentage of debt on their balance sheets. As I explained above, dollars are leaving China. And I expect Chinas foreign exchange reserve hoard to continue to decline. Falling oil prices are dollar bullish, as countries that buy oil on world markets 8212 priced in dollars 8212 can reduce their dollar credit lines, which reduces the potential of a new supply of dollars from coming on the market. If a global credit crunch similar to the credit crunch of 2007 materializes, demand for dollars and dollar-safe havens will soar. Now, take a look at the chart below, which shows how all of these global money-flow factors discussed above relate to each other. Chinese foreign exchange reserve growth (red line) oil prices (black line) and the U. S. dollar index (blue line) There is a lagging correlation between Chinese FX reserve growth and oil prices, with Chinese FX growth leading. There is a tight negative correlation between oil prices and the dollar i. e. as oil prices rise the dollar tends to fall and vice versa. If these macro trends continue to play out as I expect, your decision is easy: Sell oil, buy the dollar, and hold those positions until the trend changes. Have a safe and happy Labor Day weekend, Japan: An Accident Waiting to Happen The worlds largest debt bomb isnt Greece or Spain. Its Japan, where government debt now approaches 220 of gross domestic product. That level of spending makes profligate congressmen in America look downright parsimonious with taxpayer cash. Servicing Japans debt now consumes some 43 of government revenue, up from about 4 in the early 1970s. Its a situation thats clearly not sustainable. In theory, that much debt and all the money the Bank of Japan keeps printing to keep the country afloat should have destroyed the yen by now. Yet, it hasnt. And the reason it hasnt comes down to the countrys savings pattern. Japan is able to run huge deficits and sustain such high debt-to-GDP because it has used its vast savings over the last 50 years to fund government spending. I recently talked to my colleague, Evaldo Albuquerque, to get his thoughts. Evaldo is one of the smartest analysts I know. He made a name for himself in foreign currencies, but were teaming up to find unique, safe income plays. Heres his take: The yen hasnt collapsed yet because Japanese financial institutions hold 93 of government debt. In other words, domestic investors have financed the governments spending for the past two decades. The problem is Japan has the worlds fastest-growing population of seniors aged 65 years and older. Once all these seniors retire, they will no longer be saving. Instead, they will be cashing out their retirement accounts. The Japanese government will have to find other investors to buy their bonds. Who will buy Japanese bonds paying less than 1 International investors will certainly require a higher rate, increasing interest expenses. The government simply cant afford that. In other words, the countrys savings rate will soon go negative. And thats going to be the tipping point for the currency. For years now, Japan has been printing money and buying government debt to keep interest rates from skyrocketing. But once the savings rate turns negative, Japans government will no longer have domestic cash to rely on. So, theyll do what every government does when faced with making impossibly hard decisions theyll turn on the printing presses and crank out boatloads of yen. And the yen will finally crack. If its a managed devaluation of the yen, as I expect, Japans export-dependent companies will be big, big beneficiaries. Thats because the sales that Japanese companies accumulate in dollars, euros, pounds and yuan will translate into more and more yen as the Japanese currency weakens. Thats essentially free profits because, aside from some tax obligations, currency gains have no associated costs on a corporate income statement. What about China The answer is important because China affects so much of the world economy, especially as it relates to commodity prices and your commodity stocks A friend of mine forwarded me a story where a certain strategist said it was time to quotstart adding Chinese exposure. quot He said, quotWhere else can you buy an economy with 7-8 growth prospects at less than 10 times estimated earningsquot To believe his statement, you have to take two things at face value: 1. Chinas GDP numbers are, at least, roughly accurate. 2. Chinas earnings are, at least, roughly equivalent to earnings of other markets. I dont buy either statement. The 7-8 growth rate assumption comes from Chinas own GDP statistics. GDP, which stands for quotgross domestic product, quot is a widely accepted rough guess of economic growth. For an investor, it is almost useless, and I usually ignore it. Thats because as an investor, youre not buying quotthe economy. quot Youre buying individual securities. The characteristics of those securities should be your focus. Stick to the basics and whats in front of you. Dont get lost in abstractions like quotGDP. quot But lets play ball for a bit. If you want to rely on Chinese GDP figures to frame some kind of investment thesis, then you should know there is a lot of room to doubt their veracity. So officially, Chinas government says its economy is growing 8. Lots of people dont believe it. Charles Dumas, of Lombard Street Research, is one. He says: quotWe dont believe official data. We think GDP slowed to a 1 rate in the first quarter. quot I dont believe official data either, and I certainly dont make investment decisions based on it. Two other quick points about relying on GDP: GDP figures are backward-looking. They tell you nothing about the future. Even if you think they do, then you have to say the trend is not good. Chinas first-quarter GDP was at a three-year low. GDP as a concept is absurd. Government spending is counted as a positive. So a government that spends money digging holes and refilling them is adding to its countrys GDP. Who knows at what rate Chinas economy is really growing Frankly, I think it is an unknowable. Chinas economy is a huge, complex thing. It has many parts going in all kinds of directions. To boil all that down to a single number always strikes me as silly. The second point up top is on Chinas corporate earnings. There is a good case that such earnings deserve heavy discounting. Maybe 10 times earnings is the right number in todays environment. As Ivy Pan, an analyst with ABN AMRO, said recently, quotForecasts of company earnings have been continuously revised downward since the beginning of the year. quot Besides, there is the issue of earnings quality and trustworthiness. This is a matter of debate, too. So there is a lot of guesswork. There are also things we do know. The strategist up top cites healthy increases in imports of coal, iron ore, and copper as a plank to his bullish thesis on China. He says the increase is consistent with an economy growing 7-8. Again, we have to question how the figures come about. I think it is safe to say that Chinese government-mandated investment drives these figures. And I tend to think of that as more of a bad thing, not a good thing. Will it prop up commodity markets to some extent Of course. Its not a game I care to play, though. Anyway, it seems an odd thing to cite these commodities. Despite decent Chinese import figures, iron ore prices recently hit 2.5-year lows. Iron ore prices are down 17 since mid-June. Coking coal is down 23 since the start of July. Copper prices are down more than 20 from a year ago. Chinese steel mills are hurting. The China Iron and Steel Association said recently that the Chinese steel industrys profits fell 96 in the first half of the year compared with last year. Thats not a typo: down 96. These anecdotes dont square with the image of a booming economy. I dont know what will happen, but I find the whole thing fascinating. Ive been bearish on China in the last year, but I think some of the air has already come out of Chinas boom. (Take a look at housing prices, for instance. Chinese housing prices registered nine months of decline, and they just had an uptick.) And there are definitely China themes Id own andor will continue to own those that play on Chinas need for water and food, for instance. These are very good long-term investment themes, regardless of what happens in China in the near term. But what about commodities Now we turn to the other piece of the puzzle. Most people wouldnt care a whit about Chinas economy. They care because China is such a big user of commodities and has such an impact on world prices. A growing China is a key to the commodity bull market. But the commodity bull market is long in the tooth. It started in roughly 2000. (Jim Rogers and others date it from 1998.) So the bull market is at least 12 years old. The average lasts about 17 years, according to Jim Rogers book Hot Commodities. However, this one may already be beyond whats normal. A reader sent me this chart on commodity prices from BCA Research and Allan Gray: What this chart shows is that the long boom in commodity prices over the last dozen years has pushed commodity prices more than two standard deviations above their long-term trend line. In other words, were in outlier territory. As you can see, not too many past bull markets have pushed much beyond where we are now. There is another important point about that chart. Commodities, despite what you hear, are a poor way to preserve wealth over a long period of time. As Ian Liddle of Allan Gray notes: Importantly, the long-term trend line is down. This is a testament to human ingenuity. Over the last two centuries, we have constantly found new and more-efficient ways to produce and use commodities, and this has driven prices down over time. The new technologies to access Americas considerable shale gas reserves are the latest example of this. We believe it would be a mistake to simply extrapolate the strong rise in commodity prices over the last decade far into the future. I dont think this dynamic is somehow suspended in our own times. Commodities will continue to fall in real terms that is, adjusted for inflation over a long period of time. I think weve turned, or are turning, another corner. We should expect lower highs and lower lows on most commodities (in real terms) as the commodity bull market unwinds. It will affect everything from iron ore to oil. (I exclude the precious metals, on which I remain bullish.) If the bull market is, indeed, over, we have to change the way we look at investing in commodities. Commodity stocks have to clear different hurdles than in the last dozen years. We should not count on increases in commodity prices. Stocks should work at existing prices and lower. I would favor picks-and-shovels plays over producers. This is the way I plan to play it. Its the safe way to go. If Im wrong, Ill be wrong for a year or two as the commodity bull takes its last breaths. But then, so what There are plenty of other ideas to invest in. The truth is that the end of the commodity bull market is coming. It seems too risky to try to and call the exact top. Start playing it safe now. Start preparing today. Never before have I seen such a divergence between the quotfantasy landquot world central bankers and their faithful live in. and the real world the rest of us inhabit. In fantasy land, this was the big week investors were waiting for The European Central Bank (ECB) met yesterday and decided to buy more sovereign bonds in an attempt to bring down interest rates in troubled European countries. The program is essentially the same thing the ECB already tried earlier, to only limited results. But never mind rumors of the plan were enough for traders to throw a party in August and this week Meanwhile, in the real world, things just kept going from bad to worse, with the economic data deteriorating from one end of the globe to the other Bottom line: The divergences between whats going on in the real world and the puffed-up stock indices, which have been floating on an ocean of cheap money, are the biggest I have ever seen. The last time these divergences were this severe, was right before the stock market crashed in 2007-2008. and early 2000 before that. And THAT has major implications for your wealth What the Fed, ECB Are Doing and What It Means In his closely watched Jackson Hole, Wyoming speech last Friday, Federal Reserve Chairman Ben Bernanke tried to justify his nontraditional approach to monetary policy. He defended QE and pledged to keep interest rates low for longer periods of time, saying (in plain English) that they quotworked. quot I see an economy whose unemployment rate has remained above 8 percent for the longest stretch since the government began keeping track in the 1940s. I see an economy whose GDP is barely growing. I see an economy where confidence remains lackluster and manufacturing is shrinking again. And I see an economy where the only real beneficiaries of easy money are the commodity and stock market speculators who can make money off of it Never mind whether QE is a success or utter failure though. What is important for investors is that Bernanke did not go into detail about other FUTURE nontraditional policy options, such as nominal GDP targeting or unlimited, open ended QE. The fact he didnt mention those kinds of steps lead me to believe theyre less likely to be used. Bernanke also warned that quotthe hurdle for using nontraditional policies should be higher than for traditional policies. quot But most importantly . Bernanke himself admitted in the speech (subtly) that newer rounds of QE and Operation Twist were less effective than the first round. Thats as close to the emperor admitting hes wearing no clothes as you can get without coming out and saying so It fits precisely with what I have been saying for ages too Bottom line: The U. S. Fed will likely NOT engage in a massive new QE program. and even if it does, it could be sold aggressively by investors now that even Bernanke himself is admitting its almost completely ineffective. As for the ECB, President Mario Draghi unveiled plans to buy sovereign bonds with maturities of three years or less. So many leaks came out before the Thursday meeting that the actual news was almost anticlimactic. and now the question is whether or not investors will quotsell the news. quot Why should they Well, the bond purchases will be conditional meaning the ECB wont buy unless the targeted countries (think Spain here) agree to oversight and more supervision by fiscal authorities. The program wont seek to establish firm yield quotcaps, quot another disappointment. Most importantly, the purchases will be sterilized. That means this is not an all-in quotQEquot type strategy that balloons the size of the ECB balance sheet and results in runaway money printing. That is likely reflecting concern among the ECBs members in Germany and other more conservative countries. Global Economy Sinking Deeper into Recession So what about the quotreal worldquot There the news is going from bad to worse. Here in the U. S. the Institute for Supply Managements benchmark manufacturing index sank further to 49.6 in August. That was the third month in a row below 50, which is the dividing line between expansion and contraction in this key sector. Europes benchmark manufacturing index also slumped to 46.3 in August. That indicates the euro-zone economy is sliding deeper into recession, and that the recent rise in unemployment to a fresh euro-era record high is only the beginning As for the BRIC countries, Chinas services sector index just sank to its lowest in a year. Brazil is slowing so much, the central bank was just forced to cut its benchmark interest rate to a record low of 7.5 percent. And in India, GDP growth slowed to 5.5 percent in the June quarter. That was close to a three-year low, and well-below long-term growth targets in the 8 percent to 9 percent range. Now I want to update you on those incredible divergences I mentioned earlier. Virtually every indicator of the REAL economy is slumping or stagnating even as the broad stock market averages try to hold these elevated levels. In the top panel of the chart below, the black line is consumer confidence, the red line is the SampP 500, and the panel on the bottom shows the spread between the two. The last time there was a divergence as huge as it is now was in 2007-2008 right before the stock market crashed. The top panel in the next chart below shows the same comparison only using the ISM manufacturing index and the SampP 500. Youll see that the ISM index did NOT make a higher high along with stocks this year a key divergence. And in the bottom panel youll also see the last time they diverged this much was right before the 2007-2008 stock market crash. The time before that Right before the 2000 stock market crash Bottom line You have the real economy deteriorating sharply. You have key global players in sectors like technology and transportation warning that revenue and earnings growth is slowing rapidly. FedEx (FDX) was just the latest casualty this week, cutting its profit target for the second time since June. And yet, you have investors clinging to the hope that a few policymakers huddling in conference rooms on two sides of the Atlantic can somehow quotsave the world. quot Thats despite the fact the quotsavesquot they are talking about have already failed repeatedly. I think thats a real recipe for trouble. And thats why outside of a few select situations, stocks look very vulnerable to me. Until next time, Commercial Member Joined May 2012 3,332 Posts The ECB pledged to act forcefully to defend the EU and euro by potentially buying bonds to reduce crisis-hit euro-zone countries borrowing costs, which is a good thing. The market didnt price in the lofty summer rhetoric. But on balance, the announcement gives reason to be more bullish on the markets. still not a reason to run out and buy stocks with both hands. One of the most anticipated ECB meetings in history occurred last week, and with it the European crisis entered a new phase. Generally speaking ECB Chief Mario Draghi and the ECB met most of the markets lofty expectations, as evidenced by market action. Perhaps even more important, the ECB didnt disappoint by quotkicking the canquot down the road as European officials have done so many times over the past three years. I say that because. There are multiple risks to monitor over the next several weeks in Europe. Here are three of them:Last Weeks Signal Was NOT an quotAll Clearquot Risk 1 Markets will test the ECB First, you can expect markets to test the ECBs will at some point over the next few weeks by pushing Spanish or Italian yields higher just to see if the ECB was bluffing on its bond-buying promise. If I had to guess where, Id bet well see the first intervention in Spain before the end of October, as there remain multiple troubles brewing there. Risk 2 Spain and Italy have to ask for help before getting it One of the disappointments of the ECB meeting last week was that more strict conditions were placed on countries who need the ECB to buy their bonds than had been expected. Economists on the Street are referring to this as quotconditionality. quot In order for the ECB to buy bonds, Spain and Italy will have to formally request aid and submit to fiscal oversight by the ESMEFSF and the IMF. That implies some loss of sovereignty (psychologically, anyway), which will make Spanish and Italian politicians less likely to request aid until its absolutely necessary. As an outlier, theres a chance that both countries wont request aid. And then it becomes a game of chicken between those countries and the rest of Europe to see who blinks first. Dont think it cant happen either Greece has basically done it twice, and Europe blinked both times. What happens if Spain or Italy get the bailouts needed, but after a while stop adhering to the fiscal reforms mandated by the EFSF or ESM Risk 3 Will bailed-out nations comply The bottom line: If none of those risks mentioned above come to fruition, the ECB announcement last week was a game-changing event in Europe and a reason to think the crisis is nearing an end. But, if any of those risks actually materialize, the consequences are potentially catastrophic. And even if they dont fully materialize, if they appear to be gaining momentum, markets will fall and fall hard. The ECBs answer was very clear and another area of disappointment: If countries getting aid stop implementing necessary fiscal reforms, bond buying stops immediately meaning all this could be an enormous waste of time. One thing we do know from last weeks announcement is that the euro will be sacrificed to keep the EU together. By the ECB choosing to print euros to buy euro-country bonds, it means well see a lower euro over the long term, even though in the short term we could see the euro continue to rally as investors bet the crisis is solved. A big rally in the Euro over the next several weeks could provide a great opportunity to position yourself for the next big move in the currency, which is bound to be lower. Commercial Member Joined May 2012 3,332 Posts Now that the European Central Bank has saved the euro and our Federal Reserve has declared easy money as far as the eye can see, isnt the dollar going to get killed Well, on the surface that makes sense. But I think those concerns are short-term impacts. I still believe the dollar has entered a multi-year bull market, which began back in March 2008, when the U. S. dollar index bottomed. Now that the European Central Bank has quotsavedquot the euro and our Federal Reserve has declared easy money as far as the eye can see, isnt the dollar going to get killed And here are nine themes I see playing out that would ensure a bull market for the dollar: Theme 1Euro no longer a viable challenger against the dollar The euro is not saved yet, by any means. I expect another crisis to rear its ugly head within the next six months or sooner. But even assuming the euro is quotsaved, quot I would expect at least a decade of deflation and slow growth. As a result, the euro will fall of its own weight relative to the dollar and other major world currencies. Theme 2 Most of the monetary policy impact is behind us Each of the Feds new programs has been increasingly less effective in helping the real economy. Sooner or later the market will clear itself. And when it does the Fed will quickly take back all those excess reserves, which means U. S. dollar supply will fall. Therefore, fewer dollars will be out there as demand grows with recovery. Theme 3 Chinas reserves are falling, and hot money is fleeing I expect this trend to continue as Chinas economic growth slips further. This again goes to the point of a declining global supply of dollars, which will be good for the dollars price. Theme 4 U. S. real assets look cheap In a world increasingly looking for good long-term investment ideas, U. S. real assets, including real estate and natural resources, look very competitive. This should lead to strong foreign direct investment into the United States. Indeed, good for the dollar. Theme 5 The ramp up in U. S. domestic energy production helps the buck There are two ways this is bullish for the dollar: 1) Falling oil imports should help cut our trade deficit and 2) It leads to more international investment into the U. S. by investors wanting to position accordingly. Theme 6 Global rebalancing taking place in China and Germany As the global backdrop for export dependent countries changes, the top exporters China and Germany will have to increase domestic demand in order to grow. This will likely help U. S. exports and be the real beginning of the long awaited global rebalancing. It will be dollar positive for sure Theme 7 Rising pool of U. S. domestic savings The credit crisis has triggered a palpable shift in U. S. consumer savingsconsumption patterns. I expect this to be secular in nature. As the U. S. pool of savings for domestic corporations increases, the dependence on international funding should fall. If the U. S. current account deficit improves dramatically, the dollar will benefit. Theme 8 Falling commodity prices As China decelerates, commodity prices should fall dramatically. This doesnt mean all commodities nor does it mean the secular rally is over. But over the next 1-2 years, this will put pressure on emerging markets and will likely mean U. S. investors keep more of their money onshore for local (U. S.) investment opportunities. That means more dollars staying home instead of being exchanged into other currencies. Once this mountain of cash is redeployed to fund technologies where U. S. companies have a commanding lead, such as in nanotechnology and 3-D printing, it could virtually trigger a U. S. renaissance and would be a magnet for foreign direct investments. That would be very dollar bullish. Theme 9 2 TRILLION in U. S. corporate cash on the sidelines Needless to say the ideas Ive listed above have implications for asset markets that go way beyond the U. S. dollar. Over the next several weeks I will pick up on each of these themes in greater detail to show you why I believe its way too soon to write off the dollar or make a long-term bet on the decline in America. Commercial Member Joined May 2012 3,332 Posts Why the yen could be todays best currency trade by Jack Crooks Saturday, June 9, 2012 at 7:30am The Japanese yen continues to defy its own economic fundamentals. It continues to move up and down in value, in correlation with quotrisk offquot (stocks and growth assets moving lower) or quotrisk onquot (stocks and growth assets moving higher). But the latest statistics and dynamics driving the Japanese economy into the future still tell me the yen will weaken in a very big way, sooner or later. If you are a long-term player who has some patience, I consider this the best single trade setup among the major foreign exchange pairs: A core long-term long position in USD (U. S. dollar)JPY (Japanese yen). In other words, bet that the yen will fall in relation to the dollar. Of late, the yen (relative value) is moving in tight, negative correlation with risk assets. Using the Dow Jones Industrial Average (DJIA) as a measure of risk assets, you can see that as the Dow falls, the value of the yen rises. On the chart below, the USDJPY falls as the yen gets stronger relative to the U. S. dollar. Whether you consider the yen correlation against the DJIA or the Nikkei 225 Index, it is effectively the same concern in global stock markets means the yen strengthens. The primary reason is simple repatriation. Japan is still a very wealthy country despite the economic calamity experienced since the bubble broke back in 1989. Its insurance and pension funds have vast amounts of investment capital. When things get ugly globally, measured by stock markets, these big pools of funds tend to rush back home to hide in local Japanese government bonds for safety. For example, consider the relationship between the DJIA and USDJPY going back to the credit crunch period beginning in mid-2007: DJIA down 15.2 percent from its peak USDJPY down 35.9 percent from its peak Dollaryen has fallen 35.9 percent, or put another way the yen has strengthened 35.9 percent against the U. S. dollar since the credit crunch (creating huge price pressure on Japanese exporters) while stocks rose. And when you consider that one of the major impacts of the credit crunch was the decline in global demand for goods from export-oriented countries, such as Japan and China, you can see why Japanese companies are screaming for relief from this double whammy of pain. Japans Soaring Government Debt Crisis The dangers of a declining trade surplus and strong yen pressures are put quite clearly into context when you understand that Japan will likely run a fiscal deficit of a whopping 10 percent of GDP. Meanwhile its debtGDP ratio could rise to the moon-launch level of 241 percent (roughly twice the level of Italy) this year, according to forecasts by the International Monetary Fund. Notice in the chart below how government debt has continued to ramp up after the bubble broke in 1989. And this fits the view gaining ground that after Mr. Market is done crushing the European bond market, it turns its guns on Japan. Now, what makes that picture even worse is the train-wreck scenario of Japan no longer being able to fund these huge debt needs internally as the pools of private and business savings are drying up. In other words, if Japanese interest rates rise from their incredibly low levels 0.89 percent on the 10-year Japanese Government Bond (see chart below) the cost of funding with 200 percent debtGDP could shoot up exponentially. If Japans bonds begin to reflect real or even potential funding risk, forcing interest rates higher, it means that local demand from Japanese institutions will fall even more, putting greater pressure on rates, while the slowdown in economic activity will further reduce Japans available pool of savings to fund this growing need. Japan is facing a very scary situation here. Sooner or later, the yen will begin to reflect these internal realities. I think it will be sooner. When it does, the value of the yen has a very long way to fall (USDJPY has a very long way to rise). The long-term profit potential I see here is enormous. Best wishes, Jack Thursday, October 25, 2012 at 7:30am China has been one of the worlds worst performing stock markets in 2012, down 14 percent from its March high. Persistent worries about the health of Chinas economy have dragged stocks lower. But over the past month, stocks in Shanghai have perked up a bit. And recent upbeat economic data has many investors asking if growth in China may finally be rebounding after a seven-quarter slowdown. The answer to this question could determine if emerging markets in general 8212 and especially in Asia 8212 may enjoy a reversal of fortune leading global stocks higher once again. One thing is for sure: Investor sentiment toward China has been pervasive in recent months. Confidence Is Returning As quarterly GDP growth fell steadily for the past seven straight quarters, confidence turned sour. And investors pulled capital out of China and U. S.-listed ETFs and mutual funds that invest in China. The financial media went from debating whether China would experience a hard - or soft-landing. to predictions of an imminent crash-landing. Chinas official economic data has always been considered suspect. As if U. S. data, often subjected to sizeable revisions after-the-fact, are any better. That said recent data out of China for September turned decidedly more upbeat: 8226 September retail sales expanded at a 13.2 percent clip 8212 the strongest pace this year 8212 indicating Chinese consumers are spending. 8226 Disposable income for Chinas city dwellers is growing nearly 10 percent. And rural disposable income jumped more than 12 percent so far this year. 8226 Fixed asset investment, a key indicator of overall capital investment, surged 20.2 percent year-over-year in September 8212 to the highest level since October 2011 Also, September industrial production grew at a 9.2 percent pace, while exports were up 9.9 percent, well ahead of estimates. Meanwhile, strong growth in capital investment is being led by a pickup in domestic infrastructure projects like highway, seaport, rail, and airport investments. These are key elements of Beijings economic stimulus announced earlier this year as leaders attempt to shift the focus of Chinas economy away from an export-led growth model to focus more on domestic consumption. But it isnt just the government providing growth. Capital spending by Chinese private sector firms has risen faster than state-owned enterprises for 30 of the past 31 months And consumption growth is likely to pick-up even more in the months ahead, not only because disposable incomes are rising at a fast pace, but also because inflation remains subdued. Follow the Money Chinas consumer price index moderated to 1.9 percent in September down from 2.2 percent in August. This gives the Peoples Bank of China more room to maneuver in further reducing interest rates and lowering bank reserve requirements to stimulate more lending growth. In fact, Chinas money supply growth has risen sharply this year, expanding at a 14.8 percent clip year-over-year in September, up from 12.4 percent at the end of January 2012. Thats a very bullish sign given the high correlation between money supply growth and Chinese stock prices. And following several months of outflows there are signs that money is flowing back into China again. What really caught my eye was a report that the Hong Kong Monetary Authority was forced to intervene in foreign-exchange markets this week for a second time to prevent the HK dollar from appreciating against the U. S. dollar. After another round of money-printing by the Fed, European Central Bank, and Bank of Japan, investment funds appear to be flowing into Hong Kong at a rapid pace, given its status as the main investment gateway into China. That puts upward pressure on the HK dollar which is pegged in a narrow range to the buck. This is important because its the first intervention since 2009. the first time since the financial crisis that capital flows into China have rebounded to such a significant level. Im a true believer in following the money in global markets. Tracking block money flows into and out of markets, ETFs, and individual stocks can provide important clues about where the big money is moving to take advantage of investment opportunities. Emerging market equity funds have posted six straight weeks of capital inflows through the week ended October 17, bringing inflows to more than 21 billion year to date. And China equity fund inflows recently hit a seven-week high. I track similar money flows into ETFs using Bloomberg market data. And sure enough I noticed significant flows into China-related funds over the past several months including: 8226 iShares FTSE China 25 Index ETF (FXI), with 136.2 million inflows. 8226 iShares MSCI Hong Kong Index ETF (EWH), with inflows of 82.3 million, and. 8226 Morgan Stanley China A Share Fund (CAF) with a 3.7 million inflow This sudden reversal of money flows isnt limited to China either, or just to these funds. Several others that track China and other emerging markets are seeing strong capital inflows too, which makes perfect sense when you think about it. China is the worlds largest consumer of many commodities these days. everything from aluminum to zinc. So a pickup in Chinas growth should mean better prospects ahead for markets like Australia, Canada, Brazil, and Chile. Meanwhile, about 80 percent of Chinas imports come from Japan, South Korea, and Taiwan, so stronger Chinese domestic growth and export growth should benefit these markets as well. Bottom line: It may be premature to call a bottom in the Chinese stock market. But a sustained turnaround in Chinas economy should lead to stronger performance in many other global markets too. Good investing, Mike Burnick Commercial Member Joined May 2012 3,332 Posts You may recall my Money and Markets column, Why the yen could be todays best currency trade. Today I want to give you an update on why I believe we are very close to a long-term peak in the value of the Japanese yen. Or to put it another way a major long-term multi-year bottom in the U. S. dollar. Lets first go back to the 1980s when Japan was poised for what many believed was inevitable economic domination. The country was in the midst of a huge credit bubble valuations were off the charts. For example, in 1989 the Tokyo Imperial Palace was said to be worth more than all the real estate in California The countrys trade balance was soaring against the world, especially the United States. Japanese companies were gobbling up real assets throughout the globe. Here in the U. S. the premiere properties acquired were Pebble Beach Golf Course and Rockefeller Center. Americans were concerned, very concerned about this foreign invasion. And Japan bashing was in vogue. During the early 1980s the U. S. dollar was in a major bull market. Despite the real value of the dollar and other fiat currency values inflating away, the dollar staged a rally of almost 50 percent from its low in 1980. Paul Volckers tough love administered by a massive hike in interest rates, was the catalyst of this multi-year rally. With Japan the big dog on the block and its trade surplus soaring, U. S. manufacturers and other trade groups began applying pressure for a dollar devaluation the dollar was too high. So the major global powers jumped into action to rectify this terrible wrong. The United States, the United Kingdom, France, West Germany, and Japan got together at the Plaza Hotel in New York and agreed that the dollar was too high. The Plaza Accord or Plaza Agreement was signed on September 22, 1985. In short, the countries agreed to allow their respective central banks to intervene in the foreign currency market through a coordinated effort to push the U. S. dollar down. Though at the time billed as a dollar problem, the implicit rationale for the Plaza Accord seemed a defense against Japans rising trade surplus. Thus it was more of a push up the value of the yen agreement. Many, rightfully, believed Japans aggressive export-dominated trade policy took advantage of relatively open markets in the West by producing increasingly high-value goods and morphing up the consumer value chain. But at the same time it continuously found a way to stop or delay Western goods from making it to Japanese consumers. As I said, the Plaza Accord worked in pushing up the value of the yen. But it did little to solve the trade balance problem. Japans trade surplus remained strong even as the yen soared. In the chart below I have compared Japans trade surplus on a monthly basis with the yens value from 1983 through June 2012. I noted the Plaza Accord and the official Credit Crunch start by the red vertical lines. Think of them as bookends on the massive rally in the yen. Here is where it starts to get interesting if, like me, you believe the USDJPY is close to a major long-term bottom The way I see it, the real trigger that changed the dynamics for Japans seemingly unending trade surplus was the Credit Crunch. Thats because the Credit Crunch brought an end to Japans long string of trade surpluses I also believe it triggered the beginning of the end of the Asian export model as we know it. I see three major reasons, which are interrelated and self-reinforcing: First . it marked the end of an era of unlimited global liquidity Second . it triggered a secular change in global consumption And third . more specifically Approximately 90 percent of Japanese debt is held by Japanese investors. Over the years, huge pools of savings and massive current account surpluses have provided plenty of money to fund the Japanese governments growing need for funds as tax revenues were increasingly scarce given Japans low growth deflationary economy. But now, Japan faces a daunting prospect thanks to the Credit Crunch. No longer is it generating the current account surplus it needs. Consumer demographics and low growth have pushed the consumer savings pool sharply lower heading toward zero. And companies domestically have been using their savings pools to recover from the Tsunami and plug the holes from falling demand for their exports. Therefore, the Japanese government is at risk of a funding shortage at least internally. And this is very dangerous. Heres why Japan has a government debt-to-GDP ratio of around 215 percent. The interest cost to fund this debt is huge. Plus the yearly funding needed to maintain government services is massive. Add them up and you get a mismatch between government revenues and spending. Its called a budget deficit, and here in the U. S. we know firsthand how that works. Next, take a look at the chart below. Presently the yield on the benchmark 20-year Japanese government bond (JGB) is 1.7 percent. In fact it has hovered around this level since 1998. 20-year Japanese Government Bond Yield vs. the USD-Japanese yen 1990-today If Japan does not have the internal funding available to handle its needs, it will have to look to international investors for this funding. So Japan is faced with a triple-whammy of pain: 1) Rising funding needs, 2) Falling internal sources of funding, 3) Rising funding costs because foreign investors will expect a much higher yield than 1.7 percent to account for the risk of holding Japanese debt. Because Japan is facing this triple-whammy with an already astronomical debt load, this mix of problems will likely lead to a vicious self-feeding spiral. Then higher interest rates will lead to higher funding costs and falling bond prices will lead to dumping of bonds, which leads to higher yields to entice new buyers. I believe we are seeing the outlines of what might eventually become a Japanese government bond default as the sovereign debt problem visits Tokyo. My suspicion is that once the markets are finished attaching the euro-zone bonds, they will train their guns on Japan. To sum it up, a change in the global economy and the outlines of a sovereign bond crisis in Japan suggest to me that we must be very close to a major trend change for the Japanese yen. Best wishes, Jack Commercial Member Joined May 2012 3,332 Posts The Land of the Rising Sun is Shining Brighter By Sean Hyman, Editor of Currency Cross Trader Sometimes in life it can seem like when something has been a certain way for a very long time that it will always be that way. It8217s like the brain has a tendency to get conditioned to a situation and decides it will always be that way. Well, investors get the same way about a stock or index that8217s been out of favor for a long time. They can never seem to imagine a day when it will come back. Take, for instance, Japan8217s Nikkei index. It8217s been down for over two years in a row, even as most other stock indices have rebounded. But actually, you can look further back to the larger trend and see that Japan8217s Nikkei was one of the first indexes to top out. The Nikkei topped out in early 2006, while most other stock indexes topped out at the end of 2007 or early 2008. So, the Nikkei has really been trading lower for about six-and-a-half years. Well, you can see where it would be easy to get sucked into the thinking that those stocks are never coming back. However, it8217s simply not true. There are a couple of things changing that are going to set up the Nikkei for its first real rally in years. A Change in Direction for the Yen The first thing is the change in the yen. You see, the Japanese yen has been strengthening in a big way ever since July of 2007, and it finally peaked in October of 2011 but traded somewhat sideways through January of this year. From that point, the yen has begun to descend. In fact, let8217s take a look at the Nikkei in the weekly, three-year chart below with the Japanese yen plotted below it. Why is the fall of the yen important Japan8217s Nikkei is filled with major exporters such as Toyota, Honda, Mazda and Sony. From the viewpoint of an exporter, you want a cheap currency. If your goods appear to be cheaper because a foreigner8217s money goes further, then they are more apt to buy more of your products. However, if your currency is stronger, your products will appear more expensive to foreigners and you8217ll sell fewer. So what the currency is doing is a big deal. It8217s one of the determinants of how well these companies will do. In other words, when dealing with a strong yen, they have the wind in their faces, and when they have a falling yen, these companies finally get the wind to their backs. If you8217ve ever ridden a bicycle in the wind, then you know it makes a big difference whether the wind is with you or against you. It8217s the same with these companies. With absolutely no other changes, their performance and results will vary widely depending upon the value of the yen. What Stimulus Means for the Yen The other thing that has changed in the favor of the Nikkei is that Japan has instituted an 8220asset purchase program.8221 A pretty sizable one at that 8230 to the tune of 80 trillion yen. Then, on Friday, Japan announced 750 billion yen (9.4 billion) of stimulus to boost growth. The measure was undertaken after bond dealers concerns over government spending raised fears of a disruption at a December debt sale. This will be good for Japan8217s stocks for now and bad for its currency. So between the stimulus programs and the change in the direction of the yen, Japanese stocks have a chance to reverse course for the first time in over six years. With that in mind, let8217s look at an ETF that tracks Japanese stocks. It8217s called the Wisdom Tree Japan Total Dividend ETF (DXJ). Let8217s check out its daily, two-year chart below. Declines in the Yen Can Be the Catalyst for Huge Moves in Japanese ETFs Going into 2012, the yen took a tumble and Japanese stocks got their first good shot in the arm they8217ve had in a long time. Now, the yen is beginning to fall off the map again and DXJ is breaking out of its triangular coiling consolidation. I believe this sets up DXJ to where it could head to 36 per share or higher over the next two to three months. This means the stock could move a whopping 11 within that very short time if the yen keeps falling as I believe it will. So check out DXJ. I believe it8217s primed for its next launch higher and it8217s going to catch the masses off guard. They8217re going to wonder where this rally came from. But you8217ll know that it8217s come from the new stimulus and from the change in the direction of the yen. Have a nice day Sean Hyman Editor, Currency Cross Trader Joined Oct 2012 Status: Member 4 Posts Many thanks for your description of the triple screen trading strategy. As a noob I began researching simple strategies that utilized only one indicator alongside EMA. They seemed to work okay but my dilemma was that I didnt have enough confidence entering the trade with analysis from just one indicator and a few supportresistance lines. It was when I began looking into trading systems that utilized a few indicators to reveal an overall meaningful picture, that I discovered Elders Triple Screen Strategy. The following link is a PDF to the section of Elders book, Trading For A Living, where he explains the strategy in detail, screen by screen: trading-nakedlibrary. ingsystem. pdf As of now Im using the FXCM web trading system, but hope to get metatrader4 very soon - just need to install windows on my mac As you may already know, this platform is limited in terms of customization and availability of indicators - between Williams R and Stochastic, Ive decided to use the latter for my oscillator so that I can focus on strong signals and avoid being swayed by market noise. Elder doesnt talk much about interpreting Stochastic here, so I appreciate your extended explanation about this. My three screens are as follows: large: 3 Hour (MACD EMAs (see below) intermediate: 30 min. (Stochastic) small: 5 min In my 3 hour chart Im also using 13EMA, 28EMA and 53EMA. Ive noticed that the size of the MACD histogram bars can give hints about the strength of 13EMA movement and its likelihood of crossing the other two EMAs and flipping the direction of the trend. As histogram bars get longer, the momentum of 13EMA seems to get stronger, which may signal a change in trend. Im just about ready to employ this system on my own for the first time. Looking forward to having a greater sense of confidence in my trade decisions Members must have at least 0 vouchers to post in this thread. 1 trader viewing now Forex Factoryreg is a registered trademark.