how to trade forex

Forex Kong Viral Video – Must Watch!

Forex Kong 24 Comments

[youtube=http://youtu.be/OGshlIOGntc]

In the spirit of  “Billy Joe Jim Bob” I invite all of you! Please participate in the creation of your own “testimonial videos” as – you really can’t get enough of ’em.

I think I’ve replayed this back about a thousand times, and honestly have been laughing out loud most of the evening. I absolutely love this guy.

My eyes are wide open now!

Have a great weekend everyone, and please send this link / video to anyone and everyone you know who might enjoy a good laugh!

Craaaaaaa Zy!

Love it.

Fed To Freak! – QE To Double As Suggested!

Forex Kong 31 Comments

This is hilarious.

Or at least…..it’s hilarious to me as – you know full well what I’ve been talking about these last few months. With only 2 or 3 days down and emerging markets hemorrhaging, currencies selling off like hotcakes, and equites taking it on the chin.

A little “wakey wakey” out there people!  Anybody just “a little nervous” about what’s going on?

Gees….2 days and the sky is falling. Hello!

Well – CNBC is stumped of course, but still very, very positive about “buying the dip” and tapering “just getting started”. Uh Huh. Right..tapering as global growth / appetite for risk sets up for a major “tanking”.

The Fed will freak out sooner than later, pull taper and double QE as suggested.

EEM ( The Emerging Markets ) will be temporarily “saved” , U.S equities will rally “once again”, the U.S Dollar will continue it’s slide into the toilet, and the American people will be told “once again” that the Fed is a freaking superhero.

If you’re piecing this together at all, I hope you’ve come to realize what an impact “tapering” would have had ( I’m already talking in the past tense ) as the global “dependence” on these massive injections of liquidity has become so great – that essentially…it’s the only thing holding the house of cards up.

UPDATE: CNBC now quoting Kong with suggestion that “the Fed may need to look at “pulling back” on tapering!! But….I thought it was “pulling back on QE! – Give me a break!

I’m not putting a date on it, but as suggested here “forever” – this thing is so fragile, so dependent on stimulus, that ( in my view ) even the ridiculous “suggestion” of tapering QE could very well be the catalyst for a global move towards risk aversion.

Confirming that China’s growth is slowing, Canada pulling down GDP estimates, The EU a complete and total “disaster waiting to happen” and the U.S data so fudged…SO FUDGED it can’t even be considered relevant – what have you got?

Recovery baby…..oh ya – you bet. You buy that dip……then you keep buying.

Killing it……kiiiiillllllling it short humanity……long interplanetary travel.

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Learn To Trade Forex – Pep Talk For Beginners

Forex Kong 5 Comments

There are literally “too many trade opportunities” for me to go over / list at present in that I am extremely busy managing all this.

If you can imagine how patient we’ve been with nearly the entire month of January passing, and “nary a trade” – this is really what trading forex is all about. You’ve got to hit it when the opportunity presents itself. The patience required is enough to drive a person mad “until” you’ve come to recognize market dynamics and movement over a considerable period of time.

I’d argue that I’ve not caught a decent “sustained and reliable trend” since the massive depreciation of the Japanese Yen a year ago, as trading has been extremely tough, choppy and directionless for months.

You slug it out, you keep your positions smaller, you take profits faster. You learn to take your foot of the gas in the corners, and then “hit it” in the straight aways.

It’s a skill sure, but as with anything – if you want to get good at something you have to stick with it. Even if you aren’t “actually trading” pulling up the charts day after day, studying the price action, watching for recognizable signs of reversal etc…It will come – but with a considerable learning curve.

Shit…even me – here over the past 24 hours, jumping around, banging my head against the wall cuz I jumped out / took profits too soon. Then back at the computer to “grind out” re-entry that may not be the best. Laying half awake with freakin “japanese candle sticks dancing round my head” wondering if I should plan to get up “another hour earlier” to make sure I’m in the trade.

I make mistakes too! But you have to stick with it. You have to get past the “mystery” and stay in the game long enough to see things more clearly.

And you can’t catch them all. Man……I’ll trade up to 15 pairs on a given move and still see massive trades pass me by! You’ve just got to “catch what you can” and only take on as much as you can handle.

Anyways, I’m back at it – and I hope at least a couple of you will consider what I’ve said. Go easy, take your time, study the fundamentals and trade smaller!!

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I took another 3% profits and just as well may kick myself in the ass for not just hanging in but….these days I don’t really roll that way. Considering like 7%  practically overnight and I think another 7% over the past week – It’s been 90% sitting in cash and 10% market exposure so…the Kongdicator tune up has been an improvement, and we “might” be into a larger move here.

Ill keep taking the money and running as you know how markets are these days – I’m certainly not going to suggest “investing”.

U.S.A Is Broke – New Levels Of Desperation

Forex Kong 11 Comments

The United States of America is broke. You do understand that – don’t you?

We’re not talking about ” a little bit of a cash flow problem” or a short-term need for a “loan” no no no…..we’re talking about 100% flat-out broke, robbing Peter to pay Paul type broke, applying for a new credit card as fast as the applications can be filled out, scrounging around the living room, searching for loose change under the couch type broke.

Totally….and absolutely – flat busted.Zip.Nada.Zero type broke.

You do understand that right?

The idea of a “debt ceiling” is a complete and total “fabrication” serving no “real world” purpose, and as ridiculous as the idea of recovery in itself. The U.S debt ceiling will be raised, then raised again, then again and again…then again as there is no such thing! It’s debt to the moon as the entire economic model is built on debt!

I worry at times that people are still of the mindset that “oh well…..these things will work themselves out” or “it’s just a rough patch – everything is going to be just fine”.

You aren’t one of “those” are you?

Do you understand the net effect of these “zero percent interest rates” over time? You’ve got it right? You understand the objective here?

Seniors and anyone who may have worked their entire lives to save enough money to retire, now find their bank balances being drained like never before! 0% interest actually has a standard bank account “losing money” day-to-day as the cost of goods just keeps going higher, and there’s not a single point of interest given on savings. Factor in “fees” and you’ve got yourself and entire generation of Americans being stripped of their savings, and “forced” to seek yield in much riskier assets like……….The stock market of course! Yes yes! Take your hard-earned nest egg ( or perhaps even apply for a high interest loan) and put your money into the stock market!!

That’s what your banker or broker will tell you no?

The level of desperation appears so obvious and blatant to the outside observer, I’m seriously dumbfounded that Americans have yet to “rise up” and “speak out” of the “fleecing” currently under way. This “massive bag of debt” will in turn, be handed off to the next generation unable to survive without at least a couple of credit cards of their own….saddled with the burdens of their grandparents now sitting in cold dark rooms with little to eat – drowning in health care premiums.

I can’t even get started with Obama Care ( or is it just a further extension of the “police state”? ) and of course, now we’ve got renewed talks of “humanitarian interests in Syria” and of course “more trouble in Iran”.

It’s about Oil and the preservation of the Petro Dollar people! You know that right?

Gees…….bury head back in sand please.

More on this….ALOT MORE ON THIS to follow.

Forex Trades – Right Here – Right Now!

Forex Kong 7 Comments

Some general observations:

The overnight surge in GBP looks a tad “suspect” to me, so I’ll be watching for opportunity to “get short GBP” in any of several pairs including GBP/USD as well GBP/JPY and even GBP/NZD, pretty much “right here – right now”.

The Australian Dollar has also “seen its day” with a couple of days of retracement, but with absolutely nothing but “empty space” down below. I expect AUD to turn, and continue its way lower……much lower. Short AUD/JPY reload more or less….”right here – right now”.

The U.S Dollar has pulled back “a bit” providing for further “long opportunities” if you are still in that camp. Keep in mind that USD has changed it’s course creating higher highs since early January so….regardless of near term squiggles – I’ll be looking for a stronger USD moving forward.

Long oil idea from weeks ago has certainly been a performer (as much as I scrapped the trade a couple of days in ) and good ol gold “appears” to have caught a bid.

Another day ( ho hum ) with SP 500 / risk – trading flat as a pancake.

Wish I had more to share.

Safe Havens Misunderstood – Don't Be Fooled

Forex Kong 17 Comments

To refer to the U.S Dollar as a “safe haven” makes little sense, even to the  newbie trader/investor who I’m sure by now has at least read / heard something “somewhere” – with respect to USD’s continued depreciation/devaluation and “ever diminishing” buying power.

I don’t have the stat off the top of my head, but remember reading that the U.S Dollar has lost some 93% of its value / buying power over the past….75 – 100 years? As well that the number of “new dollars” created “every year” now surpasses the number of dollars “in existence” over the previous 800 years. That’s what I call devaluation no?

In the current investing environment any “perceived dollar strength” cannot be misunderstood as “actual strength” as…….USD rises when assets priced in USD are sold. Period. End of story.

As stocks (which are priced in U.S Dollars) are sold (by the simple mechanics of markets) a “cash” position is then raised. Investors “seeking safety” aren’t rushing out to “buy dollars”, they are simply selling stocks / assets “priced in dollars” with attempt to “get out-of-the-way” should further downside risk ensue. Do not mistake this ( as the U.S media would have you ) as “dollar strength” or even worse as a “good thing” in that……a move towards USD suggest investors are moving to “cash”.

The general spin in the media these days would have you thinking “hey the Fed is going to continue tapering, stocks haven’t fallen and hey! – Look at the U.S Dollar gaining strength too! Things must really be going well!

This couldn’t be further from the truth.

I had questioned in a previous post – which “safe haven would take the lions share” during the impending correction ( already underway ) and have now seen that indeed “all assets suggested” have begun the slow turn upward. USD as well the Japanese Yen, Gold and even U.S Bonds – all moving higher over the past couple of weeks.

Do you think it’s just by chance?

 

 

Trading The Pin Bar – A Candle To Watch

Forex Kong 10 Comments

Aside from my short-term technical indicator and longer term fundamental analysis, I am also a student of Japanese Candle Sticks. The formations created and the understanding of “what they suggest” (with respect to pure price movement) can be an extremely valuable tool for traders of any asset class.

Price is price no matter what you are trading, so learning to recognize and understand the “shapes and patterns” of a given candle or “series” of candles is a skill that you’ll eventually want to come as second nature.

The “Pin Bar” is a fantastic candle to keep your eyes open for as it usually suggests that price has been soundly rejected at a certain level and has moved quite dramatically during the duration of the candle. Lets have a look, as I had suggested “looking out for these” in both NZD/USD as well AUD/USD earlier in the week in the comments section.

Forex_Kong_Pin_Bar

Forex_Kong_Pin_Bar

You can see that price “originally” was as high as the “upper wick” of the candle extends, but as the week progressed continued lower, and lower to finish / close the candle at the absolute opposite end / lowest portion of the formation.

What does this simple “graphic representation of price action” tell you about the entire week’s activity? You’ve got it – in a single glance you’ve deduced that NZD/USD was literally “sold” right from the start of the week.

A simple strategy some traders look to employ – is to simply place a “sell order” under the low of the pin bar candle…and allow further movement in price to pick up them up as price continues to move lower.

Re entry in a number of pairs (obviously NZD/USD) is looking good however it appears that markets are stalling / sitting idle here. I’ve got several open trades but see the weekend coming and will look to re-evaluate before close here on Friday.

Spanish Speaking Traders – Bienvenidos!

Forex Kong 4 Comments

El idioma español es el segundo idioma más utilizado en los Estados States.

The Spanish language is the second most used language in the United States.There are more Spanish speakers in the United States than there are speakers of Chinese, French, German, Italian, Hawaiian, and the Native American languages combined.

According to the 2012 American Community Survey conducted by the U.S. Census Bureau, Spanish is the primary language spoken at home by 38.3 million people aged five or older, a figure more than double that of 1990.

Español es “el segundo idioma más popular” aprendida por hablantes nativos de Inglés Americano.

Spanish is “the most popular second language” learned by native speakers of American English.

I am very pleased to “kick off ” further promotion in several Latin American countries, and wish to extend a very warm welcome to those spanish speaking traders!

Estoy muy contento de “poner en marcha” una mayor promoción en varios países de América Latina, y el deseo de extender una cálida bienvenida a los comerciantes de habla Español!

Trading Greed – Take Profits Faster

Forex Kong 14 Comments

It’s very difficult trying to “teach” people not to be greedy.

Human nature ( or at least the human nature you “had” before becoming a trader ) pretty much has “greed” wound tightly ’round your genes, and for the most part – that makes sense. Man finds something that he wants / needs, then he wants more, he needs more, and if only driven by the human instinct to “survive” – he looks to “get more”.

What happens when you wake up the morning after your “discovery” and the “more” you where planning to go back for – has disappeared? Overnight – the watering hole has dried up.

Thankfully you took what you could the day before right? Running home to get that “bigger bucket” (to put all that water in) didn’t work out to well for you did it?

You have to learn to take profits when you see them…as in this crazy environment there is absolutely no guarantee they’ll still be there in the morning.

Kong on the scoreboard with 4% returns on trades initiated Monday – now looking at re entry . As well on the CNBC front I’ve actually been pleasantly surprised this week as…..the floating heads have shown considerable restraint ( as I would have expected them to just say  buy, buy , buy ).

Bernanke Was Drunk – I Understood Everything

Forex Kong 2 Comments

Well I’m pleased.

Still sounding like a someone scared half to death ( that little “quiver” in his voice ) Bernanke (clearly “buzzed”) fielded questions from some pretty sharp people this afternoon and frankly – I’m not sure if he answered a single one.

All the same I am pleased in that, it’s the first time I believe I’ve ever seen the man smile, or even show the tiniest bit of human emotion.

Can you even imagine how happy he must be? Carrying such a burden for so long, I seriously can’t imagine a comparative situation in my own life, where perhaps such “relief” may have been felt.

Here’s to you Ben! You gave us one hell of a ride! With enough twists n turns to give everyone “well their money’s worth”! Good luck to you Ben! All the best!

You won’t be missed.

A very interesting day out on the field today with the U.S Dollar pushing “about” as far as I’d be willing to see it before turning back for “just one more” fall. Have you seen the price of oil last 3 days as well? Wow….so who’s thinking that oil just tanks and the U.S Dollar shoots for the moon from here?

Not me……but I’ll tell you – we ARE getting very, very, very close to considerations of USD making a move higher, watching bond yields of course, then there’s that JPY and Nikkie oh….and don’t forget Gold! 

The following weeks promise to be very exciting. Have a good weekend everyone.