Stocks to Watch: Facebook, Apple, Alphabet, Sprint, Texas Instruments, Finish Line

Stocks to Watch: Facebook, Apple, Alphabet, Sprint, Texas Instruments, Finish Line

Among the companies with shares expected to trade actively in Friday’s session are , , , , and . Facebook shares edged down 0.2% premarket. The social-media giant said just before the market closed Thursday that it has struck a deal with congressional investigators to share Russia-backed ads purchased during the U.S. presidential campaign. CEO Mark Zuckerburg […]

The Secret of Taking Profit and Why it is Important

The Secret of Taking Profit and Why it is Important

 

This Forex educational article will be dedicated to reviewing all the aspects regarding Take Profits, so I am sure that you are going to enjoy this Forex training guide.

For those of you who missed the earlier publications, please read the article on “stop losses” and “money management” by clicking on the article names.

First of all, do you have problems with taking profit? And if so, why?

Importance of profits

It goes without saying that the take profit strategy is just as important as a trader’s stop-loss placement. Both aspects are integral parts of the reward to risk (r:r) ratios. This ratio analyzes and determines the balance between the potential profit and the potential loss of the trade.

The r:r ratio is a vital and crucial factor whether a trader is profitable or not. The other item is that win versus loss percentage. The formula is:

(r:r multiplied by win %) –  (1 x loss %) = expected result (number should be positive if profitable).

For example, with a 2.0 r:r, 30% win, 50% loss, and 20% break even score, the trader expects:

(2.0 (r:r) x 30%) – (1 x 50%) = +0.1 units of profit.

This formula establishes the true measurement of trading success.

The take profit (TP), logically speaking, has great influence and clear impact on the reward side of the r:r ratio.

Taking profit is a key element of trading success because it is the only moment when a trader actually realizes a profit. Any floating or paper profit from an open trade means nothing until the trade is closed and booked. Only then did we make realize reward and make a profit on that trade! If the win % and r:r are in good relationship with each other, then the trader can expect the benefits of profit.

Trading psychology and take profits (tp)

Similar to stop losses, many traders have difficulties with taking profits because of their trading psychology. Again the elements of Fear, Greed, and Impatience strongly influence the game of trading and severely affect trading decisions.

All these emotions have the nasty habit of letting the trader either book profit too soon before the target is reached or not book any or too little profit. And not booking the optimal profit, of course, creates a (too) low r:r, thereby harming longterm profitability.

These are the typical and usual consequences of the emotions which can occur during trading:

1)      If traders are too fearful à the trade could be closed too soon;

2)      If traders are too impatient à the trade could be closed too soon;

3)      If traders are too fearful à the trade could be left open too long.

There are ways and methods how Forex traders improve trading psychology. The tricks and tools which can be used are:

1)      Ironclad trading plan

Have a well-built trading plan with a great take profit scheme is important. It not only enhances and maximizes profits, but it also eases the trading psychology. Having take profits which make sense and are accurate is vital in maintaining confidence in the trade and having the ability to stay in the trade to the target. And staying into the target is what gives the big reward and maximizes the r:r.

2)      Use take profit levels

Don’t mess around and watch the charts 24 hours, 5 days a week. Use take profits in your trading plan and you will be pleasantly surprised when you wake up and your trade has hit your take profit.

3)      Accommodate for spread and NOT aiming for the last pip

One way of easing the trading psychology with your take profit plan is accommodating the spread and not aiming for your exact target.

How many times has it happened to all FX traders: we aim for a target, the currency pair misses the target by 2 pips and we eventually close the trade for 30 pips less because we want at least some profit, and considering the fact that we almost hit our take profit, and we should have had more. Or: Oh no, the currency hit my take profit but the spread was too big.

All Forex traders have gone through this thinking process. Don’t let it happen to you. Accommodate the spread in your take profit and don’t aim for our exact target: place your actual take profit a few pips below (for upside target) and few pips under (for downside target) your original profit place.

All of us have a plan or an idea where we want to take profit. So instead of aiming for the max, go xx pips below. Of course, it will depend on the time frame you use. If you are trading on the 5 min chart, accommodate the spread and give an extra pip or two. If you are using the 4-hour chart, accommodate the spread and gives an extra 10-15 pips. There is one catch: make sure that your r:r and profitable expectancy are still in the plus.

4)      Use trailing stops + multiple take profits

Here too the trader must check how using trailing stops and multiple take profits influences the expected profitability of the Forex trader. This is vital. Both tools are great, but may not be suitable for your strategy, nor for your profitability. A trader must check and backtest the mechanics of these tools. Once completed, these tools can offer great advantages in the realm of trading psychology.

A trailing stop helps sooth the trading psychology because it gives us Forex traders the ease of moving the trade to break even and later on even locking profit. By doing that, Forex traders create more strength and power in staying into a higher target. Having a lot of profit but still not reaching a take profit can be very stressful. All kind of doom scenarios pop up in the mind.

What if the currency turns on me?
What if the markets eat all my profit and this turns into a loss?
I moved my trade into break even, but what if the market hits my break even stop loss and then reverses? Then I might as well close out the trade now!

Many things can speak through a mind. A trailing stop puts some of it to rest.

Multiple take profit levels have the same effect. Hanging on the take profit is not easy. But If a Forex trader is locking in profits along the way, then staying in for the next target becomes a lot easier when some money has already pocketed and some profit has been booked.

Great take profit areas

Of course, the logical question in your mind must be: what is a great take profit area? This Forex article is going to address that in the following free FX training guide.

Your take profit should subscribe to certain characteristics:

a)      Your target is realistic. For example, aiming for 1.98 or 0.74 on the EURUSD is just not realistic in the year 2013. Make sure that your take profit area is within reach;

Taking profit

b)      Your target is preferably placed at bigger support and resistance levels and not below or above them. For example, when using a day chart do not put your take profit just above a huge weekly resistance area or just below a huge weekly support area. Rather move your take profit to accommodate that market structure and make sure that you still have the correct r:r;

c)       Use Fibonacci retracements and targets for your take profit planning, no matter which time frame. These Fib levels do a great job of optimizing reward and are truly well respected by the Forex marketplace;

APR 19 2013 EURUSD DAY

d)      Preferably avoid aiming for a fixed amount of pips, unless you have backtested the results thoroughly;

e)      Use major levels in the market. By using these major levels you ensure that you get the best exit price possible;

APR 19 2013 AUDUSD DAY

f)       Try to find the confluence. A Forex trader has many tools and techniques at their disposal. Make sure to look for confluence when making a trading plan. That way you are placing you take profit at the best spot.

Timeframe and take profits (tp)

It is important to realize how multiple time frame analysis can harm profit taking planning and capabilities. For those Forex traders who use 1-time frame for their analysis, entries, and exits, you are able to skip this section without worry. Forex traders who use more time frames, this is a crucial warning and heads-up.

1)      If you enter a trade on a certain time frame, make sure to plan your take profit on at least the same if not 1 higher time frame. This process helps ensure the trader that they keep focusing on the bigger picture.

2)      Once a trader has entered the trade, stay on the same or 1 higher time frame to monitor the trade. That will take the nervousness out of the trading.

3)      Most importantly, do not zoom into a lower time frame after you have entered the trade! That is the worst thing that could happen because the likelihood of a trader changing the trade plan halfway the setup is very high when a trader zooms in and starts seeing reversal signs on a lower time frame.

Time factor and take profits (tp)

Last but not least, please realize that it usually takes long before price actually reaches your take profit area. Typically this is not a fast process!

Sometimes when Forex traders enter a trade, they have the feeling that their trade should hit their target quickly and panic if their trade does not materialize quickly.

If you have a good stop loss placement, then that fear is not needed. Of course, there is always the exception. For example, if you are trading a big fundamental news announcement like an NFP, it could be a very important factor.

Usually speaking though, it takes time before the currency reaches the take profit level. And traders need to give a trade time and space before they can expect to book their profits.

When backtesting your strategy and your currency, make sure to note down how long your trade setup actually took before it developed into a winner. It is easy to scroll through a chart and see the strategy hit your take profit level. One of the problems is that when practicing a strategy in such a way, the time factor of the trade development is overlooked: it only takes few minutes to click forward days or price data. But in real life, every candle IS an actual hour. And a person can do a ton of thinking in an hour, let alone during an entire day. A Forex trader needs to know that time factor is part of the process: patience is key.

 

Will this FX educational article help you with taking profit? Please leave a note down below!

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Switzerland's SIX looks at potential $2 billion sale of payments unit

Switzerland's SIX looks at potential $2 billion sale of payments unit

SIX Group hired JPMorgan to look at options for its payments unit, including a majority or minority sale or an IPO, according to Reuters. SIX payment unit may be worth around $2 billion Swiss francs, Reuters added.

 

DB1: supervisory board’s support for CEO Carsten Kengeter is weakening, according to Reuters.

 

CME will launch spot FX basis spreads called ‘CME FX Link’ on CME Globex. This will create the first CLOB between the OTC spot FX and CME FX futures markets. The CME FX Link enables trading of an OTC spot FX contract and a CME Group FX futures contract via a single spread trade on CME Globex. It is expected to launch in Q1 2018.

 

ICE Benchmark Administration (IBA) expects to start administering the London Bullion Market Association (LBMA) Silver Price benchmark and operate the underlying auction from 2 October 2017.

 

HKEX is exploring the creation of “Primary Connect”, a programme which would allow mainlanders to subscribe for new shares listing in Hong Kong, according to South China Morning Post.

 

HKEX: Trading Technologies’ execution and client connectivity services are now available at HKEX data center.

 

IBKR invested in Chinese online brokerage start-up Tiger Brokers.

 

Citadel Securities hired Daniel Gottlander as head of swaps trading. Gottlander joins from Citigroup.

 

Sun Trading is up for sale, according to FT.

 

QuantHouse will acquire Victory Networks, a provider of high-speed networks.

 

Colt Technology named current CTO Rajiv Datta as its new COO, reporting directly to CEO Carl Grivner.

 

Powernext, the Austrian Central European Gas Hub AG (CEGH) and Power Exchange Central Europe (PXE) plan to launch the PEGAS CEGH Czech Gas Market. All spot products and futures contracts currently available on the PXE gas market will be opened on PEGAS on the 8th December 2017.

 

CFTC Chairman J. Christopher Giancarlo appointed Matthew B. Kulkin to serve as Director of the CFTC’s Division of Swap Dealer and Intermediary Oversight (DSIO). Kulkin comes to the CFTC from the law firm Steptoe & Johnson LLP, where, as a partner, he advised financial market participants on legislative and regulatory issues.

 

SEC disclosed that the Edgar Corporate Filing System was hacked in 2016. Hackers may have traded on the information.

About the Author

Bernardo Mariano brings to ERDesk his experience structuring private deals for the acquisition of mutual exchanges. Prior to joining ERDesk Bernardo worked as a Director for Instinet and later, CEO of Reuters’ Bondex. He holds an MS in Economics from University of Illinois and an MIA in Finance from Columbia University. He can be reaced at be reached at mariano@erdesk.com. 

Equity Research Desk (www.erdesk.com) provides fundamental analysis of global capital markets related entities to support the investment process of buy-side analysts at hedge funds and traditional money managers. The company focuses its coverage on securities exchanges, discount brokers, trading platforms, asset managers, financial-related technology companies and intellectual property assets in the US, Europe, Asia, and Latin America.

Pensions and Debt Time Bomb In UK: £1 Trillion Crisis Looms

Pensions and Debt Time Bomb In UK:  £1 Trillion Crisis Looms

– £1 trillion crisis looms as pensions deficit and consumer loans snowball out of control
– UK pensions deficit soared by £100B to £710B, last month
– £200B unsecured consumer credit “time bomb” warn FCA
– 8.3 million people in UK with debt problems
– 2.2 million people in UK are in financial distress
– ‘President Trump land’ there is a savings gap of $70 trillion
– Global problem as pensions gap of developed countries growing by $28B per day

Editor: Mark O’Byrne

There is a £1 trillion debt time bomb hanging over the United Kingdom. We are nearing the end of the timebomb’s long fuse and it looks set to explode in the coming months.

No one knows how to diffuse the £1 trillion bomb and who should be taking responsibility. It is made up of two major components.

  • £710 billion is the terrifying size of the UK pensions deficit
  • £200 billion is the amount of dynamite in the consumer credit time bomb

How did the sovereign nation that is the United Kingdom of Great Britain and Northern Ireland get itself so deep in the red?

This is not a problem that is bore only by the Brits. In the rest of the developed world a $70 trillion pensions deficit hangs heavy.

We are all in this boat because we apparently didn’t learn from the massive man made crisis that was the 2008 financial crisis.

The ‘we’ is referring to UK individuals who are on average holding £14,367 of debt. It refers to the pension fund managers who are ignoring the fact they hold more liabilities than assets. It refers to banks and mortgage and loan providers who give loans to people who are already indebted and who will struggle to pay the debt back. It refers to a compliant media who do not have ask hard questions about irresponsible lending practices and cheer lead property bubbles due to getting significant revenues from the banking and property sectors.

And,  ultimately the ‘we’ is the government who peddled such terrible monetary policy that it has brought us as close to nuclear financial disaster as we have been since 2008.

In the red, everywhere

In the United Kingdom we are running a deficit not only in our day-to-day lives but also in our future lives.

Unsecured consumer credit is now at 2008 levels. There is £200 billion of unsecured credit. The FCA’s Andrew Bailey has put this dangerous issue at the top of the regulator’s agenda.

unsecured consumer credit

However it is not just for the FCA to be dealing with. There is no one organisation responsible for the huge levels of personal debt that will eventually cause this financial system to implode.

Click here to read full story on GoldCore.com.

Important Guides

For your perusal, below are our most popular guides in 2017:

Essential Guide To Storing Gold In Switzerland

Essential Guide To Storing Gold In Singapore

Essential Guide to Tax Free Gold Sovereigns (UK)

Please share our research with family, friends and colleagues who you think would benefit from being informed by it.

Chemical Activity Barometer "Holds Steady" in September

Chemical Activity Barometer "Holds Steady" in September

by Bill McBride on 9/19/2017 01:38:00 PM

Note: This appears to be a leading indicator for industrial production.

From the American Chemistry Council: Chemical Activity Barometer Holds Steady; Storms Likely to Cause Future Revisions

The Chemical Activity Barometer (CAB), a leading economic indicator created by the American Chemistry Council (ACC), remained virtually unchanged in September despite the effects of unprecedented Hurricanes Harvey and Irma. Though future revisions are likely, the barometer slipped just 0.04 percent in September, following a 0.03 percent decline in August. Compared to a year earlier, the CAB is up 2.8 percent year-over-year, a marked pullback from recent year-over-year gains. All data is measured on a three-month moving average (3MMA) basis.

On a year-over-year basis, the unadjusted CAB is up 2.3 percent, also an easing from the previous six months.

Applying the CAB back to 1912, it has been shown to provide a lead of two to fourteen months, with an average lead of eight months at cycle peaks as determined by the National Bureau of Economic Research. The median lead was also eight months. At business cycle troughs, the CAB leads by one to seven months, with an average lead of four months. The median lead was three months. The CAB is rebased to the average lead (in months) of an average 100 in the base year (the year 2012 was used) of a reference time series. The latter is the Federal Reserve’s Industrial Production Index.
emphasis added

Chemical Activity Barometer Click on graph for larger image.

This graph shows the year-over-year change in the 3-month moving average for the Chemical Activity Barometer compared to Industrial Production.  It does appear that CAB (red) generally leads Industrial Production (blue).

CAB increased solidly in early 2017 suggesting an increase in Industrial Production, however, the year-over-year increase in the CAB has slowed recently.

The U.S. Current Account, the Dollar, and Real GDP Growth

The U.S. Current Account, the Dollar, and Real GDP Growth

The U.S. Current Account, the Dollar, and Real GDP Growth

September 19, 2017

The U.S. current account deficit, the broadest measure of net foreign demand, has been manageable in size and comparatively steady relative to GDP in the years since the Great Recession. The current account comprises trade in goods and services, net investment income, and transfer payments. As a percentage of nominal GDP, the deficit equaled 2.4% in 2015 and 2016, and 2.5% in the first half of this year. In 2009 when the U.S. economy emerged from the Great Recession, it equaled 2.6%. Then deficits of 2.9% of GDP were recorded in both 2010 and 2011, followed by 2.6% in 2012, and 2.1% in both 2012 and 2013.

The current account deficit now of 2.5-2.6% of GDP  matches the average size during the eight years through 2016 but is only half as much as the relative size during the prior six years through 2008, which was 5.1% overall. A deficit of 4.5% of GDP in 2003 ballooned to 5.1% in 2004, 5.7% in 2005 and 5.8% in 2006 before easing back to 4.9% in 2007 and 4.6% of GDP in 2008.

President Trump has put the goal of slashing America’s current account deficit at the center of his strategy to accelerate overall U.S. economic growth. The current account constitutes one of several components of gross national product, along with consumer spending, business capital spending, public sector expenditures and the change in inventories. But the current account per se is not a barometer of overall economic growth. As its name implies, the balance of payments (BOP), which accounts for all transactions between America and the rest of the world using double-entry bookkeeping, needs to zero out. A deficit in the current account portion of the BOP merely reflect a net inflow or surplus in net financial transactions, and this inflow confirms foreign confidence in the U.S. economy and in turns helps stimulate growth.

From an overall GDP standpoint the dynamism of two-way trade flows, that is good expansion of both exports and imports, exerts greater influence than the net current account. In the three straight years of 2004 through 2006, when the current account deficit exceeded 5.0% each time, real GDP advanced at a per annum pace of 3.25% versus 2.0% per annum in 2009-16, when the deficit averaged 2.5% per year. If acted upon, President Trump’s inclination toward protectionism is ironically likely to depress economic growth by suppressing both imports and exports.

A more covert form of protectionism than the imposition of tariffs and other barriers to imports can be implemented by manipulating the dollar. However, recent swings in the dollar have been less extreme than ones earlier in the era of floating dollar rates. The Federal Reserve compiles a trade-weighted dollar index against other major currencies whose values are market-determined. The index had a value of 108.19 on average in January 1973, fell to 92.02 in October 1978, recovered to 143.53 in February 1985, slumped to 80.34 in April 1995, but then soared to 112.2 on average in February 2002. These swings occurred in spite of occasional massive foreign exchange intervention by officials to resist market forces.

Currency market intervention, direct government purchases of one currency against another to counter market tendencies, now happens very seldom. Yet in post-Great Recession years, monthly averages of the trade-weighted dollar have been confined between 69.10 in June 2011 and 95.43 last December. The index last Friday was 86.61, not far from an average of 89.84 in August 2016. Inflation and interest rate differentials between major industrial economies are not as wide as such used to be, and as noted at the start of this update, the U.S. current account deficit in recent times has been manageable in size and not very volatile from year to year. Trump’s stress on the trade balance would have been more timely years ago than now.

Copyright 2017, Larry Greenberg. All rights reserved. No secondary distribution without express permission.

Tags: U.S. current account




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Bitcoin Towering Over $3,700, Countless ICOs and Bitcoin’s Fleeting Dominance

Bitcoin Towering Over $3,700, Countless ICOs and Bitcoin’s Fleeting Dominance

Bitcoin has been limited to a fixed trading range in the past 24 hours, with yesterday’s $3,869.49 daily high serving as the first resistance level, and today’s $3,463.96 daily low, holding as the bottom end of the range. Despite the rise in price, volume appears to be tapering off on Bitstamp. We will need to see a breakout above the existing trend lines, the daily high, and lastly the $4,000 price level, before confirming a completely new bull-run.

China cannot seem to leave the spotlight, with the noise from the ICO bans and exchange shutdowns, still profoundly resonating across the internet. Even mainstream media is drawing attention to the matter, with Bloomberg releasing an article quoting the BIS, on matters relating to bitcoin.

The other side of the spectrum has its share of naysayers as well, Professor Steve Hanke being one of them, an American applied economist at the Johns Hopkins University in Baltimore, Maryland.

With hundreds of ICOs to choose from, it is not surprising that countless new bitcoin and crypto millionaires, are using these startups as pass-throughtax vehicles. Business Insider delves into more detail on the subject in a recent article.

Furthermore, companies such as CryptoPay are also deciding to host an ICO, mainly for expansion purposes. This was a surprising announcement to say the least, especially coming from a firm that was content with focusing on debit card and payment processing.

It is understandable that the many people, who are new to the space, would flock to this form of crowdfunding. Trading requires ample patience, nerves of steel, and quite a bit of prior practical experience, not to mention how immensely mentally draining the whole endaveur often ends up being. Regardless, new users should be aware that partaking in such enterprises locks in funds, which could otherwise be available for other purposes, and recovering an investment can lead to OTC trading at heavily discounted rates, as the only available exit strategy.

Only a year has passed since bitcoin’s market cap was below $10 billion, when the first crypto currency held an overwhelming advantage over competing alternatives, quite a far cry from the September 1 record breaking $80 billion market cap. Exactly one year has passed since the 80% market share was all too common, with even the 90% threshold, not being too far from reach. The many elapsed months of volatile trading, have pushed bitcoin dominance downward, keeping it close to an approximate 50% market share most of the time.

Bitcoin started trading from the $2,972.01 weekly low on September 12 (GMT 07:00). The run-up continued until yesterday’s $3,869.55 daily high was realized. Trading has in the meantime, remained confined to today’s $3,463.96 daily low, and considerably beneath yesterday’s daily high.

If you have any questions and comments on bitcoin today, use the form below to reply.