VISION 2020

Wow... How fast time flies. It's been 3 years since my last post and yes, I am still here.

I guess now video blogging or vlogging is more appealing for netizens but for sure it takes more gadgets and time to do the shooting and editing. Of course there is a plan to venture into that but again, so many things to do and yet so little time.

Anyhow, feel free to check out my IG @calotfx as well as my FB page later on. Though hardly updated but there are plenty of interesting photos and quotes there.

As far as forex trading is concern, the last 3 years including 2019 has been going pretty well with lesson learnt along the route that never ends. Playing with probability game has its own luck, ups and downs regardless of how good your analysis are. There are just those X factors that you have to be prepared on since it can strike you (and your account) at any time. If you are not prudent with your battlefield, chances are your enemy will kill you while you are sleeping.

Hence, the same basic old school principle still applies - risk management or money management whichever you prefer to call it. This coming 2020 marks my 13 years involvement as a trader, and still doing it on part time basis. Why? There is no reason for me to do it full time as though I am a risk taker, I am still taking a calculated one. Still doing my not so interesting day job as an Electrical Engineer but hey, what the heck, I still get a good pay and free travelling so why not? Just stay on as long as possible since the retirement accounts (EPF & Unit Trust) are also looking decent after all.

There was one time back in December 2016 where we (me and my useless partners) formed a company in Indonesia with sound capital and margin to trade on. Almost put down my resignation letter when these fellas failed a simple acid test. Lucky I didn't rush for it. You see the trouble of doing business with your partners are simply due to the fact that there are more than 1 head to manage. When decision makings are against one another, the consequence are not positive. You simply cannot have two Captains in one ship.

Anyhow, I do not want to elaborate more on that experience. Still good lessons are learnt along the way so I'd rather focus on the positive side of it.

2020 is coming soon and this time I will embark on the training program in which I am ready to cater the needs of others. Learn to be a real trader guys, not a gambler. My experience and knowledge may not be perfect, but being in this arena for the past 12 years, I guess there are plenty to offer with reasonable premium to be paid. No one is oblige to pay since my introduction class will be free after all.

Last thing, as far as hobby is concern, I haven't played golf for the past 12 months as I am concentrating more on developing my riding skills, on and off the tracks. Something that I never really thought about but yes, riding is my new passion. I have yet to own a Harley but so far riding really gave me the sense of freedom and satisfaction with risk management skills at its best.

Merry Christmas & Happy New Year 2020 everyone.

KEY ELEMENTS THAT YOU HAVE TO KNOW AS AN FX TRADER

The market is definitely in constant moving due to its basic supply and demand rules. There are many variables involved but the fact is that when certain currency pairs are in either bullish or bearish trend, it will not easily change its direction unless something happened that switch the key sentiment, or probably when it reached certain overbought or oversold technical levels where majority and big market participants start taking the reverse positions.

But again, it still in constant wave of movement due to its nature of dynamism.

Hence, if you wish to trade the market successfully with minimum margin of errors, you need to consider all the dynamic factors involving the key elements of analysis as follows.

FUNDAMENTAL

1. Any NEWS with regard to the currency origin, be it hawkish or dovish will definitely create the greed vs fear factor that drives buyers and sellers to react.

2. Expectation raised through SPEECHES by the country's President, Prime Minister, Central Bank Chairman's or any key officials will also have the same factor where market will normally react by buying the news.

3. ECONOMIC CALENDAR and data released including NFP, Interest Rates, PMI, CPI, GDP etc will have at least a short term impact on currency pairs movement.

4. SENTIMENT of fear due to sudden economic collapse (e.g. Greece, BREXIT) or terrorist attack (e.g. BRUSSELS Airport) will definitely take a serious toll over that currency pairings.

TECHNICAL

1. Fibonacci Levels - One of my favorite technical levels that I always check on daily basis. These levels are basically make or break levels where price tend to bounce or make a breakout. So always watch out these levels. 

2. Moving Averages - Be it simple or exponential, MA has always been an easy technical indicators for marking the support and resistance levels on any pair. Furthermore, it is one of the simplest form of trend identifier be it on larger or smaller time frames.  

3. Zeros Levels - This is what we call psychological level. I learned about this mainly from Kathy Lien's books on Day Trading and Swing Trading The Currency Market. When price approaching round number especially at 50's, 00 or 000 levels (e.g. EURUSD - 1.0500, 1.0600, 1.1000 or 1.0550), pay extra attention since these are favorite levels where traders put their STOP LOSS, TP as well as pending orders.

4. Previous Top vs Previous High - Also serves as common support/resistance where price either bounce or breakouts when reaching these levels. This is especially obvious on the Daily and Weekly Chart where traders favor to place their BUY/SELL LIMIT orders.

5. Elliot Wave - I am not an Elliot Wave fan in particular, but I do pay attention on the 1-2-3-4-5-A-B-C pattern formation of each bearish and bullish wave. Though not easy to see the exact pattern, I found it pretty useful for my analysis.

6. Japanese Candlestick pattern - This is the basic of all technical indicators. Just google for details. If you do not understand the CS pattern, you better learn them now.

7. Relative Strength Index (RSI) - Also helpful in understanding whether the current pair is already on OB/OS condition. It helps you to plan your trade accordingly.

8. Volumes - Not really helpful but I just use it as simple indication on how active or liquid the market is on that particular days or hours.

MENTAL (Market's Psychology)

1. Fear - When the market is controlled by the BEARS, you can see the price action clearly on the downward trend on any particular days or weeks. For example, GBPUSD has been super-bearish since the BREXIT vote result in June 2016.

2. Greed - Unlike Fear, when the BULLS are in control, you can see the price action clearly towards the upward path. This is clearly seen on the USD/JPY pairs since the US Election day on last 8th November 2016, climbing from 101.00 to 115.00 in a matter of 4 weeks.   

3. Relax - This is seen during holidays when market is illiquid with no major news and key players in the market. Best time not to trade and doing something else. 

4. Ranging/Sideways/Choppy - This is when you see the price are either ranging or choppy, a clear sign of sideways market where BULLS and BEARS share equal strength.

5. Breakouts - This is the moment when you really don't want to be on the other side of the market. Sometimes breakouts can be a fake move, but on another time, it could be imminent and should not be played around. Just imagine if you were going long on the GBPUSD pair on that 24th June 2016 @ 1.5000 levels. Unless you have a deep pocket, holding a long position at such level without having a stop loss would be a very very bad decision. 

Of all the elements highlighted above, the point is that you should be aware and consider them before you take up any trade decision. I knew personally some traders who religiously stick to their technical analysis without even bothering the news at all. I must admit that I am a market technician as well with over 60% of my trades depend on the technical analysis. But still, I believe there is no harm on paying extra attention on other elements as highlighted above.

Just look at what happened on the EUR/USD pair on the 5th until 9th Dec 2016 move. It was climbing steadily from Monday until Wednesday, when suddenly spiking up on Thursday (after ECB Press Conference) and revert its movement back to South until Friday evening, coming back to its opening price level for the week @ 1.05xx. If you were blind on what happened on the fundamental side of the currency pair, you would probably bite your fingers when seeing a good 300 pips profit turned to a loser, or probably breakeven if you put your SL at the entry level.

Till then, safe trade and have a nice week ahead!

TOP 10 WEAKNESSES OF NEW TRADERS

Most of the time, people like to discuss on how to strengthen, improve or enhance your skills by doing this and that. Definitely it is highly recommended to take the positive approach. In fact, one of my previous article was on the Top 10 Tips for Beginners in which the focus is more on the do's rather than the don'ts. Fine.

This time, we will do some reverse engineering and therefore we will talk about the common weaknesses of new traders (that I personally seen and did in the past) and see whether you can work out your improvement plan from that. Of course this topic is well covered by other websites and blogs so bear with me if you find the content seems to be "Arrghhh... I know about that" sort of thing. No worries, more importantly, have you done something about it? Of course I don't care but just be true to yourself.

Let's begin.

1. Impulsive - Too Excited and Jumping into Trades

Impulsive trading will always be the top of my list. It is hard to see a new trader to take it easy when they look at the charts and price action. They always get excited without even blinking their eyes when they look at the candlestick movement. Though the daily and 4 hour chart is clearly bullish, they can simply jump and get excited from the 5 minutes (even 1 Minute) candlestick showing a bearish move and say "yeah... it's going down and it's good to sell now" and straight away trigger a SELL order. Wow! I cannot say anything since their confidence is higher than the Mount Everest. Stopping them seems impossible since it's their account but you can guess for sure how the story ends.

THE CURE TO THIS - Stay cool and relax, always.

2. Emotional - Married to their positions due to Weak Psychology

As a result of their impulsiveness and blindness in analyzing the market properly, they will hold their losing positions and cut their profit short when they get it right. A perfect recipe for a loser. I am not saying that they should cut their losses the moment the trade turns RED (your position will always start with red color because of the spread) or let a profitable trade (BLUE) turn to a losing trade by holding it too long. All they need is just to build their ability and confidence to analyse and understand what triggers that trade in the first place, by planning a reasonable TP and SL target before entering any position. Once enter, they should be able to hold it accordingly until their system or rule says to exit.

THE CURE TO THIS - Risk Small, decide on the Risk Reward ratio prior to entry and get ready to lose if you get it wrong. Stay objective with your approach based on probabilities rather than blind hope.

3. Market Chaser - Adrenaline Rush

This is another common problem ranked 3rd in my list. No doubt some new traders have system and method that are taught by their mentors and gurus. But the problem is, they cannot wait for the setup to come and they enter the market regardless what the condition is. I do not blame them 100% on this though since I have seen some mentors are giving their signals and entry methods on time-based rather than technical levels to assess. How can anyone knew for certain that you can buy or sell any currency pair 2 hours from now? If the setup does not meet the required criteria, it is always best to remain patience, stay out and wait until the technical signals give you the green light to enter. This is discipline.

THE CURE TO THIS - Relax. If there is a reason for you not to enter a trade, just stay out. It's all about patience and discipline. Let the market comes to you.

4. Risk Management - Poor

Poor risk management is always the No 1 reason for account destruction and margin calls. Most new traders do not even have this in their trading arsenal and therefore, taking every trade using the maximum leverage hoping for a home run in every single trade. They ALWAYS TAKE BIG RISK! Hoping for big money to flow in. Occasionally they will get it right. But one bad trade will surely put them out of the market permanently, wiping their account out unless they can cut their losses really fast. They believe that if they can succeed in demo, they surely can do the same thing with the real account. Of course the truth is otherwise since there is no emotional factor when trading with the demo money. Those with no risk management is definitely operating their live account like a time bomb. It's just a matter of when, not how.

THE CURE TO THIS - Risk Small, knowing how much at stakes if you get it wrong. Always have an SL, or escape plan in case if the market goes against you.


5. Technical Knowledge - Lacking

This is the core to market analysis. No doubt I have seen traders making profit purely from the price action. But knowing additional things (e.g. MA, Fibo, Support & Resistance) from the technical perspective would really help your decision making. So many times new traders are trapped with blind situations and blame the brokers (even the market) cheating them due to reverse market movement once they enter a trade position. Once I checked, the level they entered was just nice within certain key technical levels (i.e. support, resistance and even key fibonacci levels) where the likeliness of market bounce and reversal was very high. Initially I myself do not pay much attention to these technical indicators. But after being trapped and blinded by certain market move, I realized that it is a key component to my trading decision that I couldn't ignore. You don't have to know and use every single indicators in your trading platform, enough with the basics that I mentioned above, and explore more as the time goes by.

THE CURE TO THIS - Take time to learn one indicator at a time, and practice using them with your demo account first until you become more familiar and comfortable with it.

6. Fundamental Knowledge - Lacking

Same thing like technical, it would really help if you can take time to understand and appreciate the relevant issues with regard to all currency pairs (or commodities) that you are trading. Price movement are driven by human's fear and greed. Hence, on top of your technical analysis, you need to appreciate the sentiment behind it that drives the trend towards either bullishness or bearishness. Key things like the economic calendar events are something that you really cannot take for granted especially when it come to central banks latest financial and fiscal policy. These elements can either make or break your technical analysis so it deserves some serious attention and respect. Period.

THE CURE TO THIS - Take time to read and appreciate the current global issues plus the upcoming economic (and geopolitical) events on your calendar like the US Presidential Election as well as all BREXIT matters.

7. Want Everything Quick and Easy - Greed

Most new traders want to do it the fast way. They just want the signals and all its associated parameters without asking and knowing why. Some even dump their money on others to trade for them. They don't have time to learn and yet they dream of making lots of money from trading. If you have lots of money, this is where the more experienced traders will capitalize on you and taking you for a ride. There is no harm in such intention since everyone wants quick and easy money. It's just that when you don't really understand and appreciate the art behind it, you will always be caught on the bad signals given especially when your risk parameters are not well defined. So learning is still mandatory in a way, since ignorance will really place you in a disadvantage situation especially in the long run.

THE CURE TO THIS - Allocate time to learn and always put realistic target. Investment is like sowing a tree. It takes time to grow and same goes to your financial plan. Don't be scammed and lured by the Lamborghini cars and party on the boats advertisement since those are cheap tricks that work all the time, especially to the ignorance. Wake up! Nothing comes easy guys.

8. Full of Excuses - No time, Lazy & Busy

New traders hardly be true to themselves. They thought they knew this and that already and seldom listen to advice. This is the reason why I am a bit picky when someone approach me to learn about forex. From my experience, 9 out of 10 always want the short cuts. They always want the easy way. No wonder so many out there are easily scammed since the universal crowd will always behave in such a way. Unless they change their mindset, there is no point to dream about being a successful trader.

THE CURE TO THIS - This is attitude. If you don't change it, no one will. It's your choice.

9. No Entry Method and Trade Strategy - Gambler

New traders can accelerate their learning curve if they are willing to apply a particular system or approach to their trading style. But what I see out there, either their mentor are not giving them the right technique or they themselves fail to discipline themselves to follow on what have been taught to them. Furthermore, the lack of effort to learn and explore different techniques available also contribute to the reason why new traders are stuck at certain level and later quit in the end. If you don't establish certain rules or setup parameter for you to trigger a trade (e.g. when the 3EMA cross the 21 EMA upways, it's a buy signal setup), you keep on guessing and trigger your trade without a clear technical rule to follow. As such, it is hard to be consistent with your trade performance.

THE CURE TO THIS - Find a mentor, or books that you can refer to as guidance. Try multiple techniques with your demo account and assess the result. Later transfer them to your real account and evaluate the result as well. With this approach you will keep on learning and discover which technique that suits you most. No doubt over time, you will improve yourself.

10. No Trading Journal - No record of mistakes and keep on repeating them

A Trading Journal is just like your Trading Diary. This is where you keep all your records, thoughts and experiences that you encounter each day. It doesn't have to be microscopic detail since what's important is for you to record the one that matters so that you can improve your performance each day. By doing this, you will automatically learn to be true to yourself. Since this journal is only meant for your eyes, you can write anything about your trading (& thoughts) so there is nothing to be ashamed of regardless how stupid it may sound. Trust me, do this and you can see the difference.

THE CURE TO THIS - Start your trading journal today. Don't delay anymore. You can do it with your Excel file and create several folders to record your winning and losing trades, account levels, your mistakes, your thoughts, your analysis as well as your strategies.

SUMMARY

If you realize, all these points are actually related to one another. The reason I break it into pieces just to make it more specific so that it can be tackled objectively. Worse of all, I even met few new traders who thought that they have the experience already, though they just started 3 months ago. While I appreciate the confidence level, they should have listen more than do the talking.

You see even with considerable number of years of experience that I have, I never feel enough. I always read and put my thoughts inside my trading journal on daily basis. Hence, I always appreciate every moment spent with my fellow friends and traders, regardless new or seasoned, since there will always something new to learn. What more if he is more experience and knowledgeable than the rest. I only talk when asked rather than trying to prove how knowledgeable I am with the group. I have nothing to prove basically since most of the time, I always strive to improve myself from one day to another, believing that learning is an endless process. Furthermore, we all knew that we learn more from listening rather than talking.

You see, when you choose to admit your weaknesses, the way to improve yourself will be wide open. Many people would like to see you succeed but the problem is, we are the biggest enemy to ourselves by limiting our potential through our ignorance in building a good attitude in the first place.

In the end, if you can prove to be successful by doing it your way, great! But the fact is, there are more pretenders than the real contenders out there who are really good at this. You know who you are.

EDUCATE YOURSELF WITH PROPER KNOWLEDGE & SKILLS

Academics and education are two inseparable things that all of us have to go through in whatever field that we explore. Without doubt, these two elements remain the fundamental towards our judgement, analysis, assessment and evaluation that bring us to certain competency levels and sound decision making skills.

To me, academics is referring to a formal scholarly type of approach whereas education is more on experience that you gained, or self-educate throughout your life. For example, most of us learned about venomous snakes through academics since we either learn from classes, books, national geographic or probably from our parents who had told us during our kindergarten days that snakes are dangerous in general.

But to some, especially to snake lovers and zoo keepers, on top of the training that they need to attend, they probably educate themselves more through their experience dealing with these creatures. Some had even been bitten by these snakes and managed to survive. Some may not. Though their experience is priceless, normal person like you and me probably don't need this kind of experience since the consequence could be catastrophic, unless of course you are interested about the subject matter.

You see with regard to trading, same thing applies here. Most uneducated person would tell you that trading is highly risky, especially with forex. I don't blame them generally since they are not competent in doing this plus, perhaps they had encountered some bad experience in the past that told them to stay away from this at all cost.

That is why I always emphasize that you must always educate and arm yourself with proper knowledge and skills if you are serious about it since it is not a get-rich-quick scheme kind of thing. Trading is a legit business and at par with any kind of investment and financial instrument out there. But before you embark further, you need to prepare yourself with at least some basic understanding so that you know how things work and what you are doing out there.

Have you ever heard a pilot that never attend a pilot school? Never right? Even a crop dusting pilot needs to be certified or trained by his experience father, to say the least.

In my case, though my academic background and qualification is in electrical engineering, On top of some training (i.e. Academics) that I had attended earlier, I always educate myself on daily basis (for the past 9 years) about this trading stuff to a level that at some points, I became paralyze with so much information (and experience) to digest. Losing money seems to be the best lesson of all since it stocked in my head forever. But what the heck, this is where my passion is so I have no regret.

The reasons I highlight this point again and again are simple.

1. So many look at trading forex as a get-rich-quick method. They refuse to learn. Some even have no clue at what support and resistance are. All they knew is just buy at bottom and sell at the top. They used a shorter time frame and miss the big picture. To some extent, they even have the gut to argue that their positions are perfect even when the market trend is showing the other way round. Well, perhaps experience will teach them better.

2. Some gurus are giving their students wrong impression about trading that learning is not really necessary. They told their students that trading does not have to be that difficult without disclosing all the truth and pains that they had endured throughout the years before they come to that level. They named their trading method under certain techniques, just open multiple small positions (i.e. short and long) and close it accordingly when it turns blue or hit the TP level with no stop loss or risk mitigation if things not in their favor. This is easy for sideways pattern (i.e. mainly EUR/USD) but during imminent breakouts, your floating positions could be trapped for months. Ok for big accounts but small accounts will surely get the margin call.

3. Some rely too much on third party signals. I had subscribed to a premium signal provider before for a USD200 per month that promise me 80% accuracy. The fact is otherwise since the signals provided are no better than my own simple setup signal generator. At times, it even clashed with my own signals and you knew what, my signals turn out to be the correct one and I was making these guys 200 dollar richer every month. I stopped my subscription only after 2 months of unsuccessful trading using their signals.

4. The most ignored element is prudent risk management. Most knew that you should not risk more than 2% (or whatever amount that you are comfortable with) but many are left clueless on how to translate this into their trading positions. Again, it is either their trainer fail to teach such thing or the student himself tend to ignore this core element of trading. Without knowing the risk that you are taking out there with your real money, you are just as good as a gambler could be. Definitely not a trader.

With all the points highlighted above, the most fundamental part of all is to accept the fact that the forex market is like a North Pacific Ocean. Your presence is negligible. Nobody knows for certain what's down there. Big fishes, small fishes, sharks, whales and even icebergs. You name it. Before you go sailing and try to make some catch, you need to have some basic sea survival skills, just to make it back to the shore alive in case if you don't make any catch at all.

Weather is another thing that you need to read accordingly (i.e. market's condition). There are times when you can go out and there are times when you should stay on the shore. How far and how big you can catch is also subject to your boat size (i.e. Account). When brokers are giving you big leverage (i.e.1:1000), it is a bait as such telling you that you can make a big catch even with a small boat. Yes you can but chances you may not survive even when a small wave hit your boat.

All in all, don't get me wrong. My interest is always into developing you, my students and aspiring new traders into an independent trader as I am. It is a process that you cannot skip. Further to that, bear in mind that making and losing money is just part of the process but you don't have to lose big money before you can become good at this. All you need is patience and discipline.

Again, I just want to emphasize that you need some trading education and effort to be successful. One of the best way is to learn from the experience of others. If you wish to pay, fine. There are just too many gurus who are more than happy to teach you. But if you want to get it for free, extra effort is required in obtaining these knowledge and skills throughout your own experience. Though it is worth it, it could be extremely painful sometimes.

It's your choice but educating yourself is a MUST by all means, be it the hard way (i.e. read, make mistakes, explore) or the easy way (i.e. pay, listen and do).

Have A Nice Weekend!

PROTECT YOURSELF FROM SCAMMERS

Dear friends, fellow readers & traders,

Please protect yourself. As long as your money is still in your account, you are safe. Once it is transferred out, just hope for the best. But before you do, please do some due diligence by trying to check who you are dealing with, how much you are paying, ask few questions and see how they respond. Have someone at your side to advise you at the same time and always consider the worst case scenarios.

Scammers can come in many ways and faces, disguising and luring you into believing that they can change your fortune and life style within a very short period of time. The fact is, these people just want your money. Nothing else. They are not interested in helping you and they will promise you the sun and the moon until you made the deposit.

During the early 2000’s era, which was 16 years ago, there were so many online surf-for-money programs that required you to put some investment, surf and then earn daily percentage as you surf their clients website. One of the best was Studio Traffic (and 12DailyPro). Every member knew the owner was John Horan, but no one has ever met this guy, or knew his face for certain. Yeah it was paying for the first 3 years which was awesome, but as members are getting larger and reaching millions, it finally gone by early 2006 and claiming that they have been sabotaged, though in fact it was just a master Ponzi scheme that were well planned and orchestrated. Pity especially to those who joined in the final months before it collapsed. To those who had hit and ran earlier, they made some decent fortune indeed. How do I know? Well, your logic will tell you the answer.

We all learned from mistakes for sure, but even worse some never learn at all. Fool me once, shame on you but fool me twice, shame on me. This is very true. And if you have never been scammed before, consider yourself among the luckiest person in the world. Don’t worry about not making that extra money that you wish for, just be thankful that you manage not to lose whatever you have in your wallet and account right now.

Now let’s get back to forex trading. I believed the trading itself is already risky with market’s volume (i.e. over USD 5 Trillion daily) and volatility at its best.

Firstly, for those of you who is not a risk taker and not having a strong heart inside, I strongly recommend that you stay away from this forex trading arena. Seriously it is not for you.

Secondly, if you are highly emotional, driven by fear and greed at every second of your life, this is also not for you. 

But, if you believe you can control yourself over proper education and training, then you have better chance of making some fortune from this, though it may require a little bit more than that. But never mind.

So what is my point? Simple. Trading itself is already a big heartache and headache for most of us. If you deposit your money into a legit broker and later lose it because of trading, at least you can learn from it and take it as tuition fees (from those losses).

But if you put these money on someone or some agents that claimed he can generate 500% profit in 3 days, I just wish you all the best. Yeah of course it is possible to make such profit with forex, but chances are you will not see these money again. Some scammers just gone with the wind after they collect all these money from their so called investors. In Malaysia, the latest scammers involved 2 school teachers, husband and wife from Johor and Sabah reported to collect deposit over RM500k and just missing after that. This kind of thing really pissed me personally.  

Losing money in this manner, to me is much more pathetic then losing from a stupid trade initiated by yourself. Period.

The worse part, these people could probably be your close friends, contacts and even your relatives who managed to convince you to invest in them. Even if they really trade for you, be careful as it is not easy to obtain the on-paper simulated profit target. Easy said than done for sure. Ask those who ever traded others account and they knew that I am not lying.

You see all these goes back to the facts that human can never run away from the fear and greed factor within them. To those who can tame these beasts from within, well done! You must be one of the best trader out there.

But for most of us who don’t even realize that they are controlled by these two elements, chances they may be scammed if the deal sounds too good to resist. Their desire to become rich will overwrite their logic thinking until Mr Regret comes and knock on their account.   

This is why proper education is priceless in the long run. If you want to venture forex trading, be a real trader guys and girls, learn from the others’ experience and minimize the chances of making mistakes with your money. Focus on tackling these first, then you can sail smoothly towards your dream of making a fortune with something that you are passionate about.

It is not that hard after all.

I am just painting a true picture so that no one will ever call me a liar.

Oh yeah, by the way, am I a scammer? Well, you can sms/whatsapp or even call me and have ‘Teh Tarik’ with me if you want. I was told by a broker to stop doing free and charity job for this trading thingy so I would be more than happy to meet you.

Don’t worry, even if I scam you, you know where to find me LOL.

Have a nice week ahead!  

WHERE WILL THE STERLING GOES FROM HERE?

Since 24th June 2016, the cable has been heading south for over 3000 pips at all crosses, particularly for GBP/USD and GBP/JPY. It was earlier thought that 1.2795 would hold for quite sometimes but by 1st week of October, it was broken to as low as 1.1300 at some brokers platform due to the flash crash on 7th October 2016. As far as my broker is concern, the lowest recorded so far was at 1.2025 per US Dollar. Well, still it was a flash crash anyway.

If you read the news, analyst views as well as general sentiment from the price movement, it seems that it will probably go further south with some analysts predicting that it may even reach as low as 97 pence per dollar by end of this year. Wow, that would be 0.9700 then.

Is this possible? Definitely yes. The bottom has yet to be seen. With the current UK interest rate, Fed Reserve rate hike potential in December, US Presidential election to be ended by 8th November, no sign of soft brexit, no potential intervention to be taken by the BOE as well as other central banks to curb this fall out, it seems anything is possible in my honest view. At least that is what on the plate at this moment. We can assume that something may happen soon enough to support back the sterling, but that is more on assumption rather than reality.

The market is showing fear and the chart is showing that the bears are in full control with minor bull retracement these past 2 days. No serious sign of reversal just yet. I guess the British government probably don't care or this is perhaps something that has been orchestrated in order to boost the export for the UK. Definitely a cheaper pound is good for the exporters as well as for the tourism industry, but one way or another will have some adverse effect on the UK economy in general. I don't think I need further deliberation on this since it is written all over the news anyway.

As a currency trader, all we care is where it is heading in the coming weeks and months. Could the flash crash lows be a temporary bottom for now, or it probably go deeper into the sub 1.2000 territory? No one can really tell even the central banks. As far as my trading is concern, there is only one advise that seems to be applicable at this point of time - Proceed with Caution.

You can either stay with the bears or prepare to join the bull. Either way, you must always be prudent with your approach since there is no hard and fast rules here that can guarantee you certainties in any angle. I personally would like to swing the cable but the problem is, I have yet to see any strong signal that the sterling had hit the bottom.

Yes, anyone can put their guess and verdict, but the reality everything is at your own risk. Recalling what happened last week, as well as what happened to the EUR/USD back in 2008 when everyone was trying to pick its top (finally topped at 1.6038 on July 2008), it would have been crazy to do such thing. There is no need to do that after all.

Hence, for now I would just stick with the bandit strategy by scalping the market whenever possible. Looks like chicken but better than nothing though. At the same time, staying out would be the best option since market normally slows down towards the end of the year, even though still tradable.

Anyhow, after analyzing the monthly as well as the weekly chart closely, I would say that based on the RSI, Price Action and Fibo levels, sterling bulls may push it back to the north to as high as 1.2900 within these coming weeks, before the bears return and attack again. The bears probably tired after weeks of vicious attack and quite likely to take a break for a while.

Well, that is just my prediction without being biased to any position. Unless Theresa May says anything on the Hard Brexit again, the bulls will probably return and proceed with caution in giving the pound some glimmer of hope before end of this month. Otherwise, prepare for another fall out below the 1.2000 level. Pity the sterling but that is just my 2 cents.

Have A Nice Weekend!

WHAT CAN WE LEARN FROM THE STERLING FLASH CRASH?

I would call it a black Friday for the pound sterling since I personally suffered some significant losses due to this 'flash crash' on 7th October 2016, exactly at 7am local time here seconds after the Tokyo Opened. Painful indeed but this is a fact that traders have to face from time to time. Just need to analyse and move on accordingly.

While the magnitude of the spike was not as much as the one occurred during the BREXIT vote counting day in June, but the manner it crashed in less than 5 minutes, with various brokers giving various lows was something that I believed had caught most traders shocked and unaware. Some blamed this was due to thin liquidity, the auto trading algorithm errors, as well as others are pointing to the 'fat finger' tradings. You can read on this at most other websites so no deliberation is required here. Bloomberg is my favorite by the way.

Though GBP had been stumbling since weeks before, and keep on heading south for the rest of the 1st week of October, no one would have thought that it could go even lower than 1.2600 on that Friday alone.

Personally, I was speculating that the market would take it easy for the day since normally, prior to NFP released, market would technically correct itself with some profit taking and some significant retracement should be seen. Yes all of us knew the bearish trend for sure, but as experience had taught us all, it sure cannot go south all the way since technical correction was believed to be inevitable.

Further to that, with SSI extremely rated at 90% long against 10% short, RSI at severely oversold condition at almost all time frame (e.g. -20 at H4 timeframe), price at the lowest level since 1985, it was widely expected that the spike would have been in the bulls favor (at least) instead of the bears.

But early Friday morning, the seems impossible thing happened when market spiked down to over 1000 pips on certain brokers chart within 15 minutes after the Tokyo opened. My stops was severely hit (100 pips below than my setting, meaning 200 pips instead of 100) and I was left in the dark on what could have happened that brought to such a flash disaster. Yes, it was like tsunami indeed.

You see, this is in fact a very good example that anything can happen in the market. If there is no risk control for such an extreme event, anyone could have been wiped out from the market especially if you are holding a big position relative to your account size.

Nevertheless the night before, somehow there was a funny feeling that told me that this could happen. All the technical indicators were showing strong bearish conditions, no doubt. But the internal psychology had failed me by keep on pouring fear and culprit believe that the market was about to reverse, at least temporarily and that was the key reason on why I was going long for the GBP/USD, trying to pick bottom in which to me, was technically justified.

But see for yourself, no one is protected here. Perhaps it is a good lesson to me as well as the rest of market's participants.

In summary:

1. Know what you are doing, especially the risks involved.
2. Picking bottom is highly risky, regardless what the technical probability was showing.
3. RISK Management is everything. You decide your risk tolerance upfront and get ready to be wrong.
4. Once the previous support broken (i.e. 1.2795), the market can be bottomless for quite sometimes until it finds a new bottom or support.
5. Sentiment can overrule technical, as well as technical can overrule sentiment. In this case, the fear of "HARD BREXIT" sentiment (or whatever the market wants to call it) seems to make its point very clear on how useless the technical indicators could be and how vulnerable sterling is in the coming months.
6. On this case, the FEAR factor is really showing its dominance, driving the sterling to 'yet-to-be-seen' bottom in my honest opinion.
7. It is not easy not to get fully unemotional when you were caught in such situation. Lost is a lost and you just have to accept it. And yes, learn from it as well.

Have a Nice Week Ahead!

THE EASY WAY TO TRADE FOREX

Gotcha! I knew most would be interested in this topic. If you are not one of them, then you can close this page straight away. Go ahead, no hard feeling for sure.

Still here? Then you must be serious about this. So please stay and read.

Definitely there are both options for you to choose, the hard way vs the easy way. But bear in mind that either way, there are always risk involved. So let me share both options here for you to consider.

THE HARD WAY
1. Study the basics and fundamentals of trading.
2. Attend classrooms, training and seminars.
3. Put extra effort in reading the charts and analyzing the market every day and week.
4. Sleep less due to over commitment to trading and watching the chart, especially when you are new.
5. Read every single books and articles that you can find about trading.
6. Develop your own system and method of trading through trial and errors.
7. Experience losing your hard earned money and strive to improve your trading skills every day.
8. Start with small accounts and put a mission to grow it gradually.
9. Learn, learn and learn.

THE EASY WAY
1. Put your money on somebody you trust to trade, make a deal on the profit sharing arrangement.
2. Use and rely fully on EA's (Expert Advisor) and Robots.
3. Subscribe to any signal provider and just follow.
4. Open multiple small positions and pairs. See what happen and close the one in blue and leave the one in red until it becomes blue, or until your account get the Margin Call. Huhu.
5. Only trade with the extra money that you are willing to lose. Not the one that you obtained from a personal loan or your hard earned savings. I mean you really don't mind losing these money.
6. Gamble. Deposit into your real account, take maximum leverage and go gung-ho with your trading with all-or-nothing attitude. Seriously you may get rich quicker if you manage to get it right every time. Do this if you think risk is just a playground to you.

Enough? Maybe not. You see the point here is that you have options in your hand. You just have to choose which one. If you opt for the easy way, chances of turning yourself into a real trader is very much less compared to the hard way.

In my honest opinion, it is all about process. In order for you to become good at something, it takes effort and hard works. When you hear or see someone saying that it doesn't have to be hard or painstaking, most of the time these people are trying to sell you something. Normally, the reality is a total inverse to what they said.

I don't mean to scare you or distance you away from this trading arena. No, that is not my intention. I just want to highlight that you need to put efforts, patience, discipline and time for you to really develop yourself into something at anything that you do. There is no shortcuts.

Once you make progress from one level to another, then the sense of ease will come automatically. Ask a degree students who are pursuing their masters as well as masters students who are pursuing their PhD's. Chances you will get the same answers on their difficulties. But if you reverse the situation, PhD students would say that pursuing their master was not that difficult as well as masters students would say about their degrees.

But during the process of pursuing it, of course they have to face many challenges and obstacles that stood along the way. Only after overcoming them, or learn on how to overcome them, they would feel that things are actually not that difficult as they first thought it was.

So back to trading forex, yes there are easy ways for you to trade the market. You don't need to use all the indicators available as well as studying the fundamental of each pair to the level that you have to know the birthday of the Japanese Prime Minister. Definitely it is not necessary. But for you to come to that level, you just need to past through certain processes that will turn your maturity from a beginner, amateur, professional to a master trader who can later share his knowledge and experiences to develop new traders in the market.

Even after 9 years of doing this, personally I still feel that there is always something new to learn and experience from the market on daily basis. It is endless indeed. But thank god, the knowledge and experience gained are beyond satisfactory level and the process that I had gone through seems to be priceless. Perhaps it is high time to share this with other aspiring traders like you.

On the same note, please guard yourself from scammers. There are just too many out there. If you are not careful, you will probably be their next prey. So please be careful.

10 TIPS FOR BEGINNERS - HOW TO START AND DEVELOP YOUR FOREX TRADING SKILLS?

Dear Friends and Esteemed New Traders,

I have said this before and I am going to say this again. There is no shortcut to success and if it seems too good to be true, it probably is. In fact it is.

Making money (e.g. online) has always been the interest of everyone, anyone. What more if it can be done in an effortless manner. But the fact is, how many successful people out there that has became successful without putting countless effort to their success? If you read their biography, you know that the figures are probably less than 1%, I mean those who made their fortunes through pure luck and inheritance from their rich fathers and families. The rest like us, we have to work for it. Sounds conservative but that is the fact. No fairy tales here.

If you have the time, kindly browse through my archive and you will see that many tips had been shared since I started this forex venture (as well as this blog) back in 2008. In fact if you google enough, these tips and free lessons are almost everywhere. And yes, you can get it for free. But then, some or probably most still prefer to attend paid classrooms, seminars and training simply to learn from the gurus and those who have vast experience dealing with the market. Fine, if you have the money, of course it is no harm to pay thousands for these classes as long as you are happy with it. I am more than happy if my students are willing to pay me thousands as well. Why not?

But I always asked myself whether the money paid is equivalent to the value that I am offering. Of course you need to compensate me a bit at least for my time and energy, but for sure I will not charge anyone a crazy USD55,000 just to be in my inner circle. Yes, I do not drive a Lamborghini but I have a few decent cars that can take me from point A to point B without any problem. Come on, what makes you think anyone could ever afford to pay that hefty amount just to learn from you. I would rather buy a simple house and turn it into a home-stay with that amount of money. Yes of course you have to charge your students for your time and expertise sharing, but the amount has to be sensible. No harm intended though, just expressing my 2 cents.

Anyway, back to the topic, let me simplify the steps that you have to take if ever you wish to start this venture in the first place. Remember, there are no shortcuts. If you want to play football like Cristiano Ronaldo and earns like Cristiano Ronaldo, you have to at least learn and train like Ronaldo on top of the talent that seems to be a prerequisite. Same thing here. And these tips are mainly from my point of view accordingly to what I have gone through.

So let me put it in point forms for your easier understanding.

1. Objective. Always define your objective. Ask yourself why do you want to trade? For sure the answer is making money. But, there are 2 clusters of traders here that you need to understand from Day 1. Are you a trader? or more to a gambler? If you choose to be a gambler, then you can stop reading and open a live account straightaway, and dump all your money there. Well, maybe you can learn on how to be a wise gambler at least. But seriously I mean it. There is no need to learn further here. Period.

But if you choose to be a trader, you need to learn the steps on how to become a real trader. A real trader in my definition is the one who has the proven entry and exit strategy, prudent risk management and strong trading psychology. Patience and discipline is part of trading psychology that you need to really understand and master.

2. Read. Yes, you must be willing to read. So many claims that they don't have time to read, or maybe reading is not something of their 'thing'. But let me ask you a question. How can you understand the fundamental issues of any of your favorite pair if you refuse to read any news related to them? Oh yeah, of course you can listen too. But trust me, reading is much easier to find since there are more reading materials rather than the one you can listen to. So, please spend some times to read and browse through your favorites news channel and analyst columns. It is worth to pay attention.

3. Analyse. Learn to analyse the charts (technical) as well as the fundamentals. As per my previous post, no doubt analysis is important. In fact, one of the key things that you must really understand is where to locate the support and resistance of the price, the Moving Averages, Fibonacci Levels as well as general trends that drive the daily price actions. It takes time surely for your to understand, but it is well worth it.

4. Account. Especially if you are a real beginner, you must get use to the demo account. This is where you learn and experiment all the technical part of your trading. Once you are ready, then only you should open a real account. One serious advise for you to consider, always open your first live account with minimum investment. In fact nowadays there quite a number of brokers who are giving you free money just by opening an account with them. And one of my trading buddies have turned this USD30 into over USD1000 within few months. Awesome indeed. See, the concept here is really simple. You need to learn to drive a small car before you can even think of driving a Ferrari. When you put little, you got little to lose especially for beginners. First thing first, avoid the get-rich-quick mindset in the first place.

5. Prepare. On top of preparing yourself for the knowledge and skills required to trade profitably, most importantly prepare to lose your money, as well as being wrong with your positions. Yup, nobody wants to lose their money but it is a common advise that you must always invest the money that you are willing to lose. It is part of the process, no trader can skip this. So don't put everything that you have into a single trading account since you will pressure yourself unnecessarily. It is a reverse psychology since those who make a living out of this are those who can consistently take losses from time to time when they are wrong. And trust me, you will get it wrong at times so unless you are prepared for this, your risk of losing your account is very much on the higher probability side.

6. Risk. Understand all the risks associated with forex trading and the true meaning of risk management. Learn how to translate this into your trading positions, sizes and dollar at stake for each and every position that you open. Everything in life has its risk but it is how we learnt to mitigate these risks that matter. The problem is, so many ignore this element and end up crying at the end of the day blaming their gurus as deceivers since they were only told the fairy tale parts of the trading journey.

7. Patience. Always look at the big pictures. Learn to wait and hold your breath as well as your index finger from clicking that buy/sell buttons unless you really know the potential consequences. Adrenaline rush as well as impulsiveness are my biggest enemy even until today. I must always remind myself to stay clam and follow the plan accordingly. This is especially true when I chose to stay out the whole day during the UK Referendum vote counts on last 24th June 2016, when the GBP crosses were dropping for more than 1500 pips on average, especially the GBP/JPY with over 2700 pips on that Friday alone. It was tempting though, but by staying out my account is well protected from the wild volatility for the day.

8. Volatility. If there is one word to describe the forex market from the other markets, this will be the word other than the volumes. As per point #7 above, I must admit that this is the one that can really make or break your account if you are not careful about it. Understand the Random Walk Theory. Though most traders do not buy the idea to this 1973 school of thought, still I find it useful to note that nothing is certain in this life except death. Meaning regardless of how good your analysis or strategies are, you still need to open your mind that anything is possible.

Back in 2009, I lost USD3000 in  a matter 30 seconds when a surprise news hit the wire at 3am local time, causing the market to move over 200 pips on all the USD crosses with all my stop losses hit instantly. I thought it was the broker's manipulation but later realize that there was a vote by the House of the US Representatives on the QE and stimulus plan for the US economy. Lucky I had put stops or else I would lose all my account that night since the follow through was imminent.

9. Psychology. Do not be overconfident as well as lack of confidence. This one is best built through experience as well as learning from others. As a trader, taking risk is just part f the game. Always prepare yourself with surprises. Trading psychology is very much related to the twin forces of fear and greed. These are the real beasts that you need to tame within yourself first before you can start reading the market psychology's in general.

Let's put it this way, nobody is a GOD here. So what I am trying to say is that as long as you are humans, the tendency of being right and wrong is just a matter of chances. You put your verdict accordingly as per your analysis and believe, but no one knows for certain on the potential outcomes, not even Soros or Buffett. So what this has got anything to do with your trading psychology is that when you decide to take a position on the market, a sudden jerk of price either in or against your favor should be handled with a "so what?" attitude. Ask yourself whether 'Am I right?' or 'Am I wrong?' on this one and plan your next course of action accordingly. By having this in your mind, you can then avoid the tendency of being impulsive and changing your thoughts at every tick of the price movement. This in my opinion, will build your long term confidence and crucial so that you would not change your market view every now and then. If the strategy works out well, keep it up. If not, it is probably time to stay out and revise your strategy accordingly.

10. Decisions. Learn how and when to pull the trigger when it matters. This is where patience and discipline play its prime role. Learn to be patience and time your entry well. No one knows for certain when and where is the best price to enter regardless of going short or long. By knowing how to read the chart accordingly, you can pick the best possible price zones for you to trigger your orders. You see this is not only about making the right entries for profitable trades, but most importantly applicable to decisions on when to exit a bad trade. Trust me, this is the hardest thing to do in trading. But this is the key to your survival and account protection. When you are wrong, you have to get out. Of course you may ask what if the market make a U-turn back to my favor? Yes, it may. This is where I emphasize that you need to interpret the chart accordingly. Prior to entry, it is mandatory for you to decide where your exit point is, or better known as stop loss in case the trade goes really bad. Otherwise, margin call (MC) will probably be your best friend. I heard some gurus told their students that MC is ok because you will learn from it. Yes indeed it is ok for an account within the hundreds zone. But for account amounting, say 5k and above, margin call is definitely a big NO NO to me.

Just remember that making and losing money is just part of the process, but survival is a must especially when you start trading big accounts. Anything above USD1000 can be treated as big account already especially if you are using leverage 1:200 and above.

Again, these are just my opinions based on what I have personally experience through from the past years. Of course you can get into more details, but the fundamentals are the same.

Hope this helps. Feel free to drop me an email or you can Whatsapp me @ +6011119627262 if you need further assistance.

Have A Nice Day!

THE IMPORTANCE OF ANALYSIS

Analysis is important prior to any decision making since it will give you consistent view on the action that you are about to make. In terms of trading, this includes the decision either to go long, short or simply to stay aside. Though some claims that analysis is just a self-fulfilling prophecy, still it is vital to ensure that you are systematically taking calculated-risk decisions from time to time. Yes you can rely on those reports by market analysts from many online brokers out there. But wouldn't it be nice to generate and having faith in your own analysis instead? So that if anything happen to your trading positions, you know by heart that you are fully responsible instead of blaming those market analysts who provide opinions that made you clicked the buy instead of sell button.

You will also learn a lot from these self-analysis that makes you become more and more independent each day. After all, this is how you learn on how to ride the profits and cut the losses by understanding the key components in your trading. So instead of taking only 10 pips on every trade, you will understand where to put your reasonable profit targets as well as your stop losses by doing a self-market analysis.

Let's get straight to the points. There are basically 5 things that you need to analyse in particular.

1. TECHNICAL ANALYSIS

This is where all your indicators play its role including the Candlestick chart. You name it. Although indicators will show you the past performance of that particular pair, it does not guarantee the future moves, but it will somehow give you the best probabilities based on previous trending and market movements.

Technical always and will always be my first choice of analysis since market tend to repeat by itself from time to time. Furthermore, most market participants are technicians in general. At certain price levels especially at those key support and resistance areas, bulls and bears are clearly taking turns in determining the market directions, regardless whether short or long term. The thing is, the stronger party always win. Again, though many claims that technical levels are self-fulfilling prophecy, still it is a must for all traders to at least learn and understand a few of these indicators. Otherwise, it would be very hard for you to time your entry and exit especially if you plan to scalp the market.

2. FUNDAMENTAL ANALYSIS

Fundamental relates to the background issues (i.e. mainly geopolitical) with regard to any particular pair that you wish to trade. This relates to that country's fiscal and financial policies, interest rates as well as economic fundamentals. When you do fundamental analysis, you basically compare both countries fundamentals (say US vs Japan) and decide which is stronger than the other based on the current fundamental issues.

I don't want to put all the economic jargon here so my definition is always on the basis to simplify your understanding. The simplest way to do the fundamental analysis is to be aware on the weekly economics calendar (& events) and spend a while reading and understanding the online news (i.e. Bloomberg, Telegraph, Action Forex etc) and updates on daily basis. It is not that difficult after all, in fact simpler than the technical analysis.

Keeping yourself updated is a must so that you have the latest issues in your head prior to making any trade decision afterwards. Nevertheless, always bear in mind that fundamental does not necessarily translate into direct market movement and trending since the basis of bullishness and bearishness of each pairs have many elements that has to be factored in. It is what the market participants are doing that moves the market, not simply the fundamental news.

3. SENTIMENT ANALYSIS

Sentiment Analysis is another unique element of trading that some of my trading colleagues are having difficulties to understand. At times, I am personally bombarded with questions "How do you know?", "How sure are you?", "Where did you get this idea?" etc etc. Of course I would not know for certain. No one does. But don't forget that sentiment is something that you can see with your eyes open as well. How the market reacts and move the price is the one that indicates the real sentiment in the market, especially when a strong trending (i.e. Bullish or Bearish) is currently in place. If I can simplify it further, I would say it is how you feel about the market, without being bias to either bulls or bears.

Sentiments do relate to both technical and fundamental analysis. That is the reason why you need to know both. Why? Because the market is made of people and people act accordingly to their believes. Hence for example if a price is approaching a key resistance level, say at 61.8% Fibonacci level, or triple zeros (e.g. 1.3000) it is not necessary that it will make a u-turn there. You need to blend both technical and fundamental issues since this is the one that generate the current sentiment, or so called market believe at that particular moment of time. So if the sentiment is strong, normally the market break all these supposedly resistance or support level without even looking back. They move together like a herd and conduct stampede from time to time that at times leaving you wondering what is going on.


4. PRICE ACTION (PA) ANALYSIS

Price action is basically a part of technical analysis. It is a direct indication on who is in control at that particular point of time or time frame. Hence, even though you plan to go long based on all your analysis above, it is worth to pay attention to the current price action in order to make the best possible entries.

It is simply done by understanding the Japanese candlestick movement accordingly to your favorite time frame. I used to watch even the 5M (5 minutes) time frame previously but nowadays 15M tend to be my favorite. Of course technically I used all the time frame from 15M above, including the monthly chart as well for my PA analysis. But for scalping and entry purpose, 15M as well as 1HR interval tends to be my most preferred time frame for my intra-day trading decisions.

Learn and understand the various patterns of the shooting stars, dojis, hammers and haramis so that in can be translated into your personal trading signals. These patterns are among the easiest thing to understand so spend some times in learning them. Another thing, you need to watch the price momentum as well since during market trending, sideways and breakout, the price momentum varies from one another. Therefore, as mentioned above, understanding the price action patterns is also vital particularly for your entry and exit timing.

5. SELF ANALYSIS

Believe it or not, this is the mother of all analysis. You know why? Because regardless of what is happening in the market, it will do no harm to your trading account as long as you do nothing. Nevertheless, losing control of yourself due to some personal reasons, fatigue, frustration, tension, or probably work stress will definitely be translated into impulsiveness and poor trading decisions. I must admit that this is the hardest analysis to do in trading.

Hence, I would say that on top of all the analysis that I have outlined above, this one you need to ask yourself since no one else can tell about your state of mind except yourself. How to do this? Check my previous 2 posts and you will find the answer on the RWAPD Method. Again, I must emphasize that this is the hardest analysis to master unless you can be true to yourself, throw your ego away, admit your weaknesses and work to improve them as you move on. Otherwise, you will consistently self-destruct your trading accounts.