Tag: Emotions

Forex Trading News – How to Use it Correctly for Profit

Kelly Price asked:

Today, forex trading news is more plentiful than ever. There are numerous sources to choose from and there all delivered at the click of a mouse, so you can get breaking news whenever you wish.

Here we will look at how to use Forex trading news and mistakes to avoid.

First let’s start with a rather startling fact:

100 years ago 90% of traders lost and today the ratio still remains the same.

This is despite better more frequent Forex news, better computers, more powerful software and more information than ever on the markets.

The fact is knowing the news won’t help you win – in fact, it generally helps traders lose! There are 3 main reasons for this:

News is discounted in a split second.

In today’s world of instant communications news is discounted immediately, so by the time you have seen it and had a chance to act upon it, the moment has gone and the market is looking toward the future.

News is Stories

Those analysts are so convincing with their arguments! Their normally great at explaining what has happened – but you can’t trade off what they say, as they have no idea what will happen – there simply stories and opinions.

Will Rodgers once said.

“I only believe what I Read in the papers”

Now he was joking, but its surprising how many traders take what they hear on the news as a recommendation to trade.

News Gets Your Emotions Involved

Humans don’t like to stand alone and the news reflects what the majority want to hear but that is completely different from what you have to do, to trade to win.

The bulk of traders lose and the bulk listen to the news, so if you avoid it, you can step aside and not let your emotions get involved.

If you do this, you can trade in a disciplined fashion and join the elite minority of winners.

If you use forex charts and simply follow price action, you are far more likely to be successful than you would be by following news stories.

WHERE THE NEWS CAN HELP YOU!

There is one great way to use the news:

If you see a very bullish or bearish market and the news supports the prevailing view but the market does not react the way it should – then its time to look for a contrary trade and time your entry points via your forex charts.

It’s a fact that:

Bullish markets collapse when the fundamentals are most bullish and bearish markets rally when the news is at its most bearish.

If you can look for these turning points on your charts and find the news suddenly stops pushing the market the way it should, a contrary trade is developing and a big profitable trade is shaping up.

Finally

The way to use forex news outlined above, is a very powerful profit tool but completely different to the way most forex traders use it!

Forex News – Why Most Traders Use it in the Wrong Way and Lose!

Kelly Price asked:

It’s a fact that today is forex news sources are better than ever and its delivered quicker yet the ratio of losers to winners in forex trading remains the same as it did 50 years ago 95% lose and only 5% lose. The news can be useful but you need to know how to use it.

First let’s look at a simple equation:

Forex Fundamentals (supply and demand news) + Investor Psychology = Price

The facts are there for all of us to see but assessing the impact of the news is hard because humans (millions of them) all motivated differently see the facts but they all draw their own personal conclusions from them and that’s the price.

If it were easy to trade by following the news then there would be a lot more winners than there actually are. Will Rogers once said:

“I only believe what I see in the papers”

Of course he was making a joke but I am amazed by how many traders think that because a story appears on Reuters or another newswire, they can trade it – you can’t.

The fact is that humans always push prices top far up or down, as their emotions come into play and most major tops are formed when the news is most bullish and vice versa in a bear market.

It’s a fact that prices generally move in line with the long term fundamentals but prices spike to far from fair value up or down along the way and history shows us these spikes don’t last.

You can spot them easily on a forex chart and trade them for profit.

There is a well know saying:

“If you can hold onto your head when everyone around you is losing theirs, you probably haven’t heard the news”

In forex trading this means you sit back in a detached fashion and look at your forex charts and when you see a price spike you start to question the news.

For example – the euro spiked to 1.50 recently and everyone said that the dollar was finished – yet its rallied and will probably rally further.

Why?

Because all the news stories have been discounted: Interest rate cuts, the sub prime mortgage crisis, the US will slip into recession etc and things can only get better and people also didn’t pay attention to GDP which is robust.

The dollar was simply oversold and rallied, when the news was at its most bearish.

This doesn’t just happen in forex, it happens in any market.

I read a great story about oil going to $160.00 dollars a barrel and that $100.00 a barrel was sustainable.

Well – there is no shortage of oil.

Global demand is actually falling and the true value of oil is in the $70 – 80 region. When people said $100 a barrel was a forgone conclusion – it was time to sell.

The fact is we are not creatures of logic, we are creatures of emotion.

Humans are also pack animals, we like to be with the crowd and the news reflects this.

The facts are the crowd never wins.

If you look at a forex chart and you see a piece of bullish news that fails to rally a market or a bearish piece of news that doesn’t cause a market to fall – that is telling you to look at your charts and look for a contrary trade.

Forex news can be useful – but not in the way that many traders think.

The above are just a couple of examples, of how you can use forex news ( or any market news) to generate contrary trades, enjoy currency trading success and join the elite winning minority.

Why Horror Films Are So Popular

Derek Both asked:

Horror films are designed to scare and disgust viewers with evil characters, plots and events that can range from realistic to completely supernatural. Nobody will ever really understand why people would prefer to put on a horror DVD rather than a nice, relaxing comedy that won’t make you jump out of your seat. However, the horror genre has been around for years with classics from Dracula and Frankenstein to modern day versions such as The Hills Have Eyes and The Ring.

A horror DVD is the top choice for many people when it comes to selecting a film which is why this genre has remained a firm favourite amongst movie fans. Maybe it’s to laugh at the story lines, pull faces at the disgusting bits or to get adrenalin pumping. One popular theory is that horror films touch on emotions that other films don’t. After all what other kind of film can make you bury your head under the pillow, jump at the slightest noise or make you suddenly afraid of the dark?

People know that they can get a thrill from a horror DVD which you can’t get from any other type of film. Viewers anticipate an adrenaline rush similar to the kind of felling you get before going on a big ride at an amusement park. That is one of the reasons why this genre of film is so popular – because people know exactly what they’re getting and they know exactly what to expect.

People also enjoy the fact that when they are watching a horror DVD they are completely detached from reality. When completely engrossed in a film and sitting on the edge of your seat, it is easy to forget everyday stresses and problems and therefore is a great way to unwind for an hour and a half. This is something you are unlikely to achieve from a light – hearted film as you can probably get distracted very easily.

Perhaps the most obvious reason why horror films are so popular is because people like to watch them at Halloween. At a time when everyone is talking about ghosts, witches and unexplained occurrences, people like to put on a horror DVD and get in the spirit.

There is such a wide variety of horror films available from monster films, gory films, supernatural and slasher films so it is no surprise that there is something out there to appeal to everyone. With such an abundance of films to choose from horror films will probably always be a favourite amongst many people.

Spice Up Your Lives With Online Peppy Humors

Wain Roy asked:

Humor is the spice of life. Life without fun and humor is simply vain. Thanks to technological advancement in recent years, sources of humor have evolved themselves to new heights. Movies or plays are not the only source of humor of today. In fact, the duration of these stuffs leaves little option for people who can hardly afford to spend even an hour. Quick sources of humor surround our daily lives but we hardly care to look around and feel their presence.

Humor is not restrained to words or enactments. Even pictures possess the capacity to evoke laughter. A hoarding on the roadside can not only attract the attention of the passersby but also bring out smiles if it possesses a fun element. Funny pictures apart, funny videos are also an excellent source of quick humor.

Undoubtedly, funny videos offer moments of quick relief. These light moments are extremely important to cheer one’s spirits and shrug off every stress. In fact, visual sources of humor like videos and pictures create greater impact. Pictures and videos drawn from real life help one to connect to their own experiences. Most of the funny videos available on the Internet are drawn from real-life incidents, which help convey personal elements with a hint of fun.

Funny pictures, on the other hand, may incorporate cartoon sketches of well-known figures as well as real-life pictures. A number of them convey jokes to laugh your belly out. These hilarious stuffs evoke emotions to help our body attain equilibrium of health and happiness.

Physicians and therapists too emphasize on the advantages of humor in one’s life. Funny stuffs like pictures or videos can work wonders for people who are prone to depression. Even a five-minute fun break from your hectic schedule can be truly refreshing. Besides, the joy of watching funny videos with your friends or family is a nothing short of a priceless experience. These happy hours are a great way to strengthen your bonds with your near and dear ones.

So make the most of your lives by gorging in little tidbits of humor. The Internet is one platform from where funny stuffs like jokes, pictures or videos can be easily accessible. Take your pick of the jokes, funny pictures or funny videos to bring a fresh lease of life into the dull drudgery of your monotonous lives.