Forex Trading Strategies Using Trendline Analysis

Forex Trading Strategies Using Trendline Analysis
When your trading strategy involves a technical analysis
you will need to chart the data, which means that you must
become comfortable with using charts to determine trends
and indicators. You must able to spot ongoing trends and
recurring patterns that disrupt the continuity of data.
Charted data may be divided into two categories, which
includes reversal patterns and continuation patterns.
Reversal patterns indicate a market entry point or time to
liquidate an open position. Continuation patterns indicate
that a trend was disrupted and then continued in the
direction of the original trend.

Market trends present a pattern of the market's broad
movement. Trend lines are determined by connecting two
points on a linear graph of historical market data as
either peaks or troughs in the data. Even though a trend
may be established with only two points, more points
provides a better picture of true market trend. Trends may
be established for any chosen timeframe, from minutes to
years. Trend lines may indicate an upward or downward
pattern or they may not point in either direction. Data
sometimes settles into familiar charting patterns

A common analytical technique is to analyze the
intersection of trend lines with the most recent price. If
a downward trend intersects with the most recent price, it
indicates that you should buy. If an upward trend line
intersects with the most recent prices, it indicates that
you should sell.

Trend lines are controversial because many traders become
confused as to where to actually draw the lines. Since
trends are defined by price actions, trend lines are
intended to be a tool for determining the direction of a
trend. Upward trends represent higher lows and indicate
that prices are going up while downward trends represent
lower highs and indicate that prices are going down. With
an upward trend, you should draw a straight line that
connects the lowest low to the highest high and in a
downward trend; you should connect the highest low to the
lowest high. Prices are then expected to fall within these
boundaries. Many traders are confused as to whether they
should draw the lines at closing price highs and lows or
the highs and lows of a particular period. They are
confused as to whether the lines should be adjusted to
account for spikes in the data, whether spikes in the data
should be ignored or whether trend lines should be adjusted
to the scale of the chart.

Advocates of trend lines use more sophisticated trend line
channels. These channels connect the lows of price actions
on one side and the highs of price actions on the other
side and a purchase is made at or near the support trend
line and a sale at the line of resistance. The objective is
to buy cheap and sell at profit several times over the
length of a price action. This can very profitable so long
as price remains within the chosen channel. Should the
price break out of the channel, traders need to make
consideration for several factors and establish parameters
for their measurements.

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Andrew Daigle is the creator and author of many successful
websites including ForexBoost at http://www.ForexBoost.com
and http://forex-trading-system.typepad.com , Free Forex
Training Resource for the Novice and Advanced Forex trader.

Check my Credit Report - How often should I?

Check my Credit Report - How often should I?
Checking your free credit score report is probably one of
the hottest topics these days. With the average American
not being rich, and at times in need of a loan, they need
to keep there credit score healthy. There will be
situations where someone will need to pull your credit
report. If you have bad credit, it may not be a good
experience for you. There is lots of talk about
annualcreditreport, but there is not much talk about not
getting your credit score there. Annualcreditreport does
provide you with a free credit report from all 3 credit
bureaus, but you don't get your scores. You can get this
report once a year for free. A lot can happen to your
credit report during a year's time. Here are some examples.

Inaccurate credit report

Studies show that inaccuracies are common in credit reports
and can harm your ability to get loans. Inaccurate
information on your credit will cause harm to your credit
rating. When your credit rating is jeopardized, so is the
ability to get loans, good interest rates, or even that new
"Dream Job." Often there is human error involved in the
reporting process. Creditors pay someone to report
information about you. At times this information may have
been keyed in incorrectly, and as a result your credit
score drops.

Identity Theft Protection

Someone's identity is stolen every 3 seconds. If you think
about that, someone could be stealing your identity as you
read this article. That is pretty scary. If an identity
thief has got your information currently and is out using
your credit, how would you ever find out without pulling
your credit report? Maybe someone is out opening credit in
your name, and charging up stuff. What ever the thief is
doing, you are probably not going to find out about it
until it's too late. If you get credit report monitoring
services set up, you would get e-mail alerts when critical
changes take place to your credit report. Critical changes
like someone opening credit in your name and out having a
field day with your credit.

Conclusion:
Checking your credit report should not be a scary thing, it
should be a positive thing. If you are managing your credit
properly, then you will pull your credit in confidence. You
will be able to go to creditors and get good interest rate
loans with ease. Since a lot can happen to your credit in
such a short time, you should get a copy of your free
credit score report every 60 to 90 days. Checking your
credit report once a year is asking for a disaster, and is
total disregard for what is really going on out there
Protect yourself by staying on top of your report. I would
not wait for it to happen to you, check your free credit
score report today.

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About the Author: Mike Clover is the owner of
http://www.creditscorequick.com/ . CreditScoreQuick.com is
the one of the most unique on-line resources for free
credit score report, fico score, Internet identity theft
software, secure credit cards, and a BlOG with a wealth of
personal credit information. The information within this
website is written by professionals that know about credit,
and what determines ones credit worthiness.

Stock Market Timing - Should You Bother When You Invest?

Stock Market Timing - Should You Bother When You Invest?
At the time of writing this article the Markets are showing
great signs of nervousness and probably should be on Prozac.

The problem is that the Markets are uncertain as to the
future and therefore have bouts of pessimism followed by
optimism followed by pessimism again. Consequently, we see
big swings in daily prices of securities. We know that the
main instigation for this has been the "credit crunch",
which is a result of a lot of poor lending decisions and
too much credit being made available to people who
ultimately can't afford to make the repayments.

This has been particularly the case in the USA but the
contagion has spread. I do not wish to belittle the
importance of the lack of credit being available as we have
seen the upset, uncertainty and fear that can be caused as
the Northern Rock was a direct casualty of this.

That said, the Stock Market continually goes through cycles
of good times and bad times. However, the thing to remember
is that unless capitalism is completely broken it will
recover.

We have seen this on numerous occasions from the period
around the First World War, the Great Depression in the
late 20s to early 30s, the Second World War, the crash of
1987 and, most recently, the bursting of the dot com bubble
from January 2000 to March 2003. In every case, the Market
recovered and recovered strongly.

I missed out one important period and that was in the early
70s when Ted Heath was struggling with the unions, the
three day week and oil prices went through the roof. In
1973 to 1974 the Stock Market fell by around 70% but
recovery the following year was even more dramatic with a
rise of over 150%.

The point I am trying to make is that corrections will
occur and there will be periods, sometimes extended, of
negative performance. However, the economy and therefore
the Stock Market will bounce back. The question now,
therefore, is what do you do if you are already invested?
In this case I would recommend that you review your
portfolio to make sure it is in line with your long term
aims but I would not recommend bailing out.

Why?

Because it is impossible to time the Market. Further, if
you miss the good days by being out of the Market then you
can miss substantial opportunities. As an example of this
there is a study of the Dow Jones covering the first
quarter of 1981 through to the end of the second quarter in
2003. It showed that if someone had been invested all
through this period, which had good times and bad times,
the annualised return was 10.4%. However, if an investor
was trying to jump in and out of the Market to avoid the
falls but missed the best ten days in that period, their
annualised return would fall to 7.7%.

Similarly, if they missed the best twenty days then it
would fall to 5.8% and the top fifty days of performance
missed would reduce the annualised return to 1.3%. This
means that the unfortunate "mis-timer" of the Market would
have lost out on 86% of the total return if they had been
out of the Market for the best fifty days for investment.

In addition, this does not take into account the costs of
buying and selling. A buy and hold strategy is more
efficient from a cost and ttax point of view. Consequently,
it is important to get your choices right at the start.

The more cautious may think they would rather just stick
the money under the bed but you must remember that
inflation will continue to eat away at your money's real
value. For example, the Government's target of 2% for
Consumer Price Inflation means that your pound would only
be worth sixty pence after twenty five years.

The Retail Prices Index is actually higher than this and is
running at over 4% as I write, which means it would half
the value of your money in around seventeen years.

The moral of this story is that if you are looking to
invest you must be looking at long term horizons and not
short term. You just be prepared to see some volatility in
the values of your portfolio, but do not panic. Have the
belief in what the Market can and has done consistently.

Looking ahead, I believe that there will be some bargains
to be had. It is said of Aristotle Onassis, the Greek
shipping magnate, that he made his fortune at the time of
the Great Depression because he was one of the few people
with cash and was able to buy his first fleet of ships at a
tenth of their value. Whilst I do not expect that we are
looking at a Great Depression or prices as low as Onassis
found, I do believe that there could be significant value
in certain arenas.

The Financial Tips Bottom Line

Understanding the key principles and fundamentals of
investing is crucial when you are investing your money on
the Stock Market. If you don't, then you run the risk of
continually chasing the next big fund launch and incur
additional costs when you buy and sell shares and funds.

Action Point

Don't make the mistake of underestimating the importance of
leaving your money invested over the long term. And make
sure you have the money invested in a suitable portfolio
(NOTE: This is vastly different to a collection of funds
that many investors have) using the process of Asset
Allocation.

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Ray Prince is an Independent Financial Planner with
Rutherford Wilkinson plc, and helps UK Resident Doctors and
Dentists get the best deals on mortgages, protection and
investments, as well as helping them achieve their
financial objectives. Just visit
http://www.medicaldentalfs.com to get your free retirement
planning guide. Rutherford Wilkinson plc is authorised and
regulated by the Financial Services Authority.